- Fourth quarter revenues of $2.62
billion, up 14.5% from 2023
- Fourth quarter reported diluted earnings per share ("EPS") of
$1.95, up 14.7% from 2023; and
adjusted diluted EPS of $2.23, up
3.7% from 2023
- Full year revenues of $9.87
billion, up 6.7% from 2023
- Full year reported diluted EPS of $7.69, up 2.7% from 2023; and adjusted diluted
EPS of $8.93, up 2.5% from 2023
- Full year 2025 reported diluted EPS expected to be between
$8.34 and $8.59; and adjusted diluted EPS expected to be
between $9.55 and $9.80
SECAUCUS, N.J., Jan. 30,
2025 /PRNewswire/ -- Quest Diagnostics Incorporated
(NYSE: DGX), a leading provider of diagnostic information services,
announced today financial results for the fourth quarter and full
year ended December 31, 2024.
"In the fourth quarter, we delivered impressive revenue growth
of nearly 15%, including approximately 5% organic growth, while
also improving our profitability," said Jim
Davis, Chairman, CEO, and President. "For the full year, we
drove revenue growth of close to 7%, including approximately 3%
from organic growth. Our team completed eight acquisitions,
including LifeLabs in Canada,
expanded our advanced diagnostics portfolio, and extended our
geographic and market reach with new clinical, consumer and health
plan customers."
Mr. Davis continued: "Our guidance for 2025 reflects our
confidence in the core strength of our business, continuing robust
utilization, and the momentum from acquisitions completed in 2024.
These dynamics position us favorably to accelerate revenue and
earnings growth in 2025."
Select 2024 full year accomplishments:
- Completed eight acquisitions, including LifeLabs in
Canada and four hospital outreach
lab acquisitions.
- Extended our health plan access to over 90% of in-network lives
nationwide, including in new geographies through collaborations
with Elevance Health and Sentara Health Plans, which took effect
January 1, 2025.
- Grew our Advanced Diagnostics portfolio, adding the sensitive
p-tau217 and p-tau181 biomarkers to our AD-Detect blood-based test
menu for assessing Alzheimer's disease risk, and launching the
first H5 avian influenza test from a commercial laboratory based on
a pandemic preparedness contract from the U.S. Centers for Disease
Control and Prevention.
- Engaged approximately 75 academic, health system and community
oncology centers in our Haystack MRD Early Experience Program,
which provided oncologists with advanced access to our Haystack MRD
blood test for aiding in the early detection of minimal residual
disease from solid tumor cancers. We are now transitioning these
organizations to a commercial program and are focused on expanding
utilization among oncologists.
- Expanded our questhealth.com consumer-initiated test platform
to include approximately 135 tests, including micronutrient
deficiencies and high-risk Lipoprotein(a) cholesterol testing.
- Deployed automation and AI technologies across diverse
laboratory, customer service and administrative areas, including
automating core laboratory processes at three major regional
laboratories, improving quality, customer experiences and
productivity.
|
Three Months Ended
December 31,
|
|
Twelve Months Ended
December 31,
|
|
2024
|
|
2023
|
|
Change
|
|
2024
|
|
2023
|
|
Change
|
|
(dollars in millions,
except per share data)
|
|
Reported:
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues
|
$
2,621
|
|
$
2,288
|
|
14.5 %
|
|
$
9,872
|
|
$
9,252
|
|
6.7 %
|
|
Diagnostic information
services revenues
|
$
2,556
|
|
$
2,221
|
|
15.1 %
|
|
$
9,614
|
|
$
8,976
|
|
7.1 %
|
|
Revenue per
requisition
|
|
|
|
|
0.2 %
|
|
|
|
|
|
1.3 %
|
|
Requisition
volume
|
|
|
|
|
13.9 %
|
|
|
|
|
|
5.5 %
|
|
Organic requisition
volume
|
|
|
|
|
0.6 %
|
|
|
|
|
|
0.7 %
|
|
Operating income
(a)
|
$ 361
|
|
$ 267
|
|
35.3 %
|
|
$
1,346
|
|
$
1,262
|
|
6.7 %
|
|
Operating income as a
percentage of net revenues (a)
|
13.8 %
|
|
11.7 %
|
|
2.1 %
|
|
13.6 %
|
|
13.6 %
|
|
— %
|
|
Net income attributable
to Quest Diagnostics (a)
|
$ 222
|
|
$ 192
|
|
15.1 %
|
|
$ 871
|
|
$ 854
|
|
2.0 %
|
|
Diluted EPS
(a)
|
$ 1.95
|
|
$ 1.70
|
|
14.7 %
|
|
$ 7.69
|
|
$ 7.49
|
|
2.7 %
|
|
Cash provided by
operations
|
$ 464
|
|
$ 527
|
|
(12.3) %
|
|
$
1,334
|
|
$
1,272
|
|
4.8 %
|
|
Capital
expenditures
|
$ 123
|
|
$
72
|
|
73.9 %
|
|
$ 425
|
|
$ 408
|
|
4.4 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
(a):
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
$ 409
|
|
$ 338
|
|
21.2 %
|
|
$
1,541
|
|
$
1,457
|
|
5.8 %
|
|
Operating income as a
percentage of net revenues
|
15.6 %
|
|
14.8 %
|
|
0.8 %
|
|
15.6 %
|
|
15.8 %
|
|
(0.2) %
|
|
Net income attributable
to Quest Diagnostics
|
$ 253
|
|
$ 245
|
|
3.7 %
|
|
$
1,011
|
|
$ 994
|
|
1.8 %
|
|
Diluted
EPS
|
$ 2.23
|
|
$ 2.15
|
|
3.7 %
|
|
$ 8.93
|
|
$ 8.71
|
|
2.5 %
|
|
|
|
(a)
|
For further details
impacting the year-over-year comparisons related to operating
income, operating income as a percentage of net revenues, net
income attributable to Quest Diagnostics, and diluted EPS, see note
2 of the financial tables attached below.
|
Dividend Increased
Quest Diagnostics' Board of Directors has authorized a 6.7%
increase in its quarterly dividend from $0.75 to $0.80 per
share, or $3.20 per share annually,
effective with the dividend payable on April
21, 2025 to shareholders of record of Quest Diagnostics
common stock on April 7, 2025. The
company has raised its dividend annually since 2011.
Guidance for Full Year 2025
The company estimates its full year 2025 guidance in the table
below. The company has included a presentation that includes
additional guidance information on the Events and Presentations
page of its investor relations website, which can be found at
www.QuestDiagnostics.com/investor.
|
Low
|
|
High
|
|
Net revenues
|
$10.70
billion
|
|
$10.85
billion
|
|
Net revenues
increase
|
8.4 %
|
|
9.9 %
|
|
Reported diluted
EPS
|
$8.34
|
|
$8.59
|
|
Adjusted diluted
EPS
|
$9.55
|
|
$9.80
|
|
Cash provided by
operations
|
Approximately $1.45
billion
|
|
Capital
expenditures
|
Approximately $500
million
|
Note on Non-GAAP Financial Measures
As used in this press release the term "reported" refers to
measures under accounting principles generally accepted in
the United States ("GAAP"). The
term "adjusted" refers to non-GAAP operating performance measures
that exclude special items such as restructuring and integration
charges, amortization expense, excess tax benefits ("ETB")
associated with stock-based compensation, gains and losses
associated with changes in the carrying value of our strategic
investments, and other items.
Non-GAAP adjusted measures are presented because management
believes those measures are useful adjuncts to GAAP results.
Non-GAAP adjusted measures should not be considered as an
alternative to the corresponding measures determined under GAAP.
Management may use these non-GAAP measures to evaluate our
performance period over period and relative to competitors, to
analyze the underlying trends in our business, to establish
operational budgets and forecasts and for incentive compensation
purposes. We believe that these non-GAAP measures are useful to
investors and analysts to evaluate our performance period over
period and relative to competitors, as well as to analyze the
underlying trends in our business and to assess our performance.
The additional tables attached below include reconciliations of
non-GAAP adjusted measures to GAAP measures.
Conference Call Information
Quest Diagnostics will hold its quarterly conference call to
discuss financial results beginning at 8:30
a.m. Eastern Time today. The conference call can be
accessed by dialing 888-455-0391 within the U.S. and Canada, or 773-756-0467 internationally,
passcode: 7895081; or via live webcast on our website at
www.QuestDiagnostics.com/investor. We suggest participants
dial in approximately 10 minutes before the call.
A replay of the call may be accessed online at
www.QuestDiagnostics.com/investor or, from approximately
10:30 a.m. Eastern Time on
January 30, 2025 until midnight Eastern
Time on February 13, 2025, by phone at 866-360-8701 for
domestic callers and 203-369-0179 for international callers.
Anyone listening to the call is encouraged to read our periodic
reports, on file with the Securities and Exchange Commission,
including the discussion of risk factors and historical results of
operations and financial condition in those reports.
About Quest Diagnostics
Quest Diagnostics works across the healthcare ecosystem to
create a healthier world, one life at a time. We provide diagnostic
insights from the results of our laboratory testing to empower
people, physicians and organizations to take action to improve
health outcomes. Derived from one of the world's largest databases
of de-identifiable clinical lab results, Quest's diagnostic
insights reveal new avenues to identify and treat disease, inspire
healthy behaviors and improve healthcare management. Quest
Diagnostics annually serves one in three adult Americans and half
the physicians and hospitals in the
United States, and our more than 55,000 employees understand
that, in the right hands and with the right context, our diagnostic
insights can inspire actions that transform lives and create a
healthier world. www.QuestDiagnostics.com.
Forward Looking Statements
The statements in this press release which are not historical
facts may be forward-looking statements. Readers are
cautioned not to place undue reliance on forward-looking
statements, which speak only as of the date that they are made and
which reflect management's current estimates, projections,
expectations or beliefs and which involve risks and uncertainties
that could cause actual results and outcomes to be materially
different. Risks and uncertainties that may affect the future
results of the company include, but are not limited
to, adverse results from pending or future government
investigations, lawsuits or private actions, the competitive
environment, the complexity of billing, reimbursement and revenue
recognition for clinical laboratory testing, changes in government
regulations, changing relationships with customers, payers,
suppliers or strategic partners, acquisitions and other factors
discussed in the company's most recently filed Annual Report on
Form 10-K and in any of the company's subsequently filed Quarterly
Reports on Form 10-Q and Current Reports on Form 8-K, including
those discussed in the "Business," "Risk Factors," "Cautionary
Factors that May Affect Future Results" and "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" sections of those reports.
This earnings release, including the attached financial tables,
is available online in the Newsroom section at
www.QuestDiagnostics.com.
ADDITIONAL TABLES FOLLOW
|
Quest Diagnostics
Incorporated and Subsidiaries
Consolidated
Statements of Operations
For the Three and
Twelve Months Ended December 31, 2024 and 2023
(in millions, except
per share data)
(unaudited)
|
|
|
Three Months Ended
December 31,
|
|
Twelve Months Ended
December 31,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Net
revenues
|
$
2,621
|
|
$
2,288
|
|
$
9,872
|
|
$
9,252
|
|
|
|
|
|
|
|
|
|
Operating costs and
expenses and other operating income:
|
|
|
|
|
|
|
|
|
Cost of
services
|
1,763
|
|
1,552
|
|
6,628
|
|
6,199
|
|
Selling, general and
administrative
|
466
|
|
407
|
|
1,770
|
|
1,642
|
|
Amortization of
intangible assets
|
37
|
|
27
|
|
127
|
|
108
|
|
Other operating
(income) expense, net
|
(6)
|
|
35
|
|
1
|
|
41
|
|
Total operating costs
and expenses, net
|
2,260
|
|
2,021
|
|
8,526
|
|
7,990
|
|
|
|
|
|
|
|
|
|
Operating
income
|
361
|
|
267
|
|
1,346
|
|
1,262
|
|
|
|
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
(65)
|
|
(40)
|
|
(201)
|
|
(152)
|
|
Other income,
net
|
3
|
|
10
|
|
30
|
|
20
|
|
Total non-operating
expense, net
|
(62)
|
|
(30)
|
|
(171)
|
|
(132)
|
|
|
|
|
|
|
|
|
|
Income before income
taxes and equity in earnings of equity method
investees
|
299
|
|
237
|
|
1,175
|
|
1,130
|
|
Income tax
expense
|
(68)
|
|
(40)
|
|
(273)
|
|
(248)
|
|
Equity in earnings
of equity method investees, net of taxes
|
5
|
|
8
|
|
19
|
|
26
|
|
Net
income
|
236
|
|
205
|
|
921
|
|
908
|
|
Less: Net income
attributable to noncontrolling interests
|
14
|
|
13
|
|
50
|
|
54
|
|
Net income
attributable to Quest Diagnostics
|
$ 222
|
|
$ 192
|
|
$ 871
|
|
$ 854
|
|
|
|
|
|
|
|
|
|
Earnings per share
attributable to Quest Diagnostics' common
stockholders:
|
|
|
|
|
|
|
|
|
Basic
|
$ 1.98
|
|
$ 1.72
|
|
$ 7.78
|
|
$ 7.59
|
|
|
|
|
|
|
|
|
|
Diluted
|
$ 1.95
|
|
$ 1.70
|
|
$ 7.69
|
|
$ 7.49
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
111
|
|
112
|
|
111
|
|
112
|
|
|
|
|
|
|
|
|
|
Diluted
|
113
|
|
113
|
|
113
|
|
113
|
|
|
|
|
|
|
|
|
|
Quest Diagnostics
Incorporated and Subsidiaries
Consolidated Balance
Sheets
December 31,
2024 and 2023
(in millions, except
per share data)
(unaudited)
|
|
|
December 31,
2024
|
|
December 31,
2023
|
|
Assets
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
549
|
|
$
686
|
|
Accounts receivable,
net
|
1,304
|
|
1,210
|
|
Inventories
|
188
|
|
190
|
|
Prepaid expenses and
other current assets
|
351
|
|
286
|
|
Total current
assets
|
2,392
|
|
2,372
|
|
Property, plant and
equipment, net
|
2,113
|
|
1,816
|
|
Operating lease
right-of-use assets
|
651
|
|
602
|
|
Goodwill
|
8,856
|
|
7,733
|
|
Intangible assets,
net
|
1,763
|
|
1,166
|
|
Investment in equity
method investees
|
123
|
|
135
|
|
Other
assets
|
255
|
|
198
|
|
Total
assets
|
$
16,153
|
|
$
14,022
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts payable and
accrued expenses
|
$
1,394
|
|
$
1,359
|
|
Current portion of
long-term debt
|
602
|
|
303
|
|
Current portion of
long-term operating lease liabilities
|
173
|
|
153
|
|
Total current
liabilities
|
2,169
|
|
1,815
|
|
Long-term
debt
|
5,615
|
|
4,410
|
|
Long-term operating
lease liabilities
|
535
|
|
503
|
|
Other
liabilities
|
938
|
|
876
|
|
Redeemable
noncontrolling interest
|
83
|
|
76
|
|
Stockholders'
equity:
|
|
|
|
|
Quest Diagnostics
stockholders' equity:
|
|
|
|
|
Common stock, par value
$0.01 per share; 600 shares authorized as of both December 31,
2024 and 2023; 162 shares issued as of both December 31, 2024
and 2023
|
2
|
|
2
|
|
Additional paid-in
capital
|
2,361
|
|
2,320
|
|
Retained
earnings
|
9,360
|
|
8,825
|
|
Accumulated other
comprehensive loss
|
(88)
|
|
(14)
|
|
Treasury stock, at
cost; 51 shares as of both December 31, 2024 and
2023
|
(4,857)
|
|
(4,826)
|
|
Total Quest Diagnostics
stockholders' equity
|
6,778
|
|
6,307
|
|
Noncontrolling
interests
|
35
|
|
35
|
|
Total stockholders'
equity
|
6,813
|
|
6,342
|
|
Total liabilities
and stockholders' equity
|
$
16,153
|
|
$
14,022
|
|
Quest Diagnostics
Incorporated and Subsidiaries
Consolidated
Statements of Cash Flows
For the Twelve
Months Ended December 31, 2024 and 2023
(in
millions)
(unaudited)
|
|
|
Twelve Months Ended
December 31,
|
|
2024
|
|
2023
|
|
Cash flows from
operating activities:
|
|
|
|
|
Net income
|
$
921
|
|
$
908
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
493
|
|
439
|
|
Provision for credit
losses
|
5
|
|
1
|
|
Deferred income tax
provision (benefit)
|
13
|
|
(49)
|
|
Stock-based
compensation expense
|
88
|
|
77
|
|
Other, net
|
15
|
|
41
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
Accounts
receivable
|
(71)
|
|
(15)
|
|
Accounts payable and
accrued expenses
|
(67)
|
|
(55)
|
|
Income taxes
payable
|
16
|
|
(2)
|
|
Other assets and
liabilities, net
|
(79)
|
|
(73)
|
|
Net cash provided by
operating activities
|
1,334
|
|
1,272
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
Business acquisitions,
net of cash acquired
|
(2,164)
|
|
(611)
|
|
Capital
expenditures
|
(425)
|
|
(408)
|
|
Other investing
activities, net
|
41
|
|
(42)
|
|
Net cash used in
investing activities
|
(2,548)
|
|
(1,061)
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
Proceeds from
borrowings
|
1,846
|
|
2,592
|
|
Repayments of
debt
|
(303)
|
|
(1,844)
|
|
Purchases of treasury
stock
|
(151)
|
|
(275)
|
|
Exercise of stock
options
|
73
|
|
72
|
|
Employee payroll tax
withholdings on stock issued under stock-based compensation
plans
|
(24)
|
|
(28)
|
|
Dividends
paid
|
(331)
|
|
(314)
|
|
Distributions to
noncontrolling interest partners
|
(47)
|
|
(57)
|
|
Other financing
activities, net
|
21
|
|
14
|
|
Net cash provided by
financing activities
|
1,084
|
|
160
|
|
|
|
|
|
Effect of exchange rate
changes on cash and cash equivalents and restricted cash
|
(7)
|
|
—
|
|
|
|
|
|
Net change in cash
and cash equivalents and restricted cash
|
(137)
|
|
371
|
|
Cash and cash
equivalents and restricted cash, beginning of period
|
686
|
|
315
|
|
Cash and cash
equivalents and restricted cash, end of period
|
$
549
|
|
$
686
|
|
|
|
|
|
Cash paid during the
period for:
|
|
|
|
|
Interest
|
$
262
|
|
$
134
|
|
Income taxes
|
$
256
|
|
$
317
|
Notes to Financial Tables
|
1) The
computation of basic and diluted earnings per common share is as
follows:
|
|
Three Months Ended
December 31,
|
|
Twelve Months Ended
December 31,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
(in millions, except
per share data)
|
|
Amounts attributable
to Quest Diagnostics' common stockholders:
|
|
|
|
|
|
|
|
|
Net income attributable
to Quest Diagnostics
|
$
222
|
|
$
192
|
|
$
871
|
|
$
854
|
|
Less: Earnings
allocated to participating securities
|
2
|
|
—
|
|
5
|
|
4
|
|
Earnings available to
Quest Diagnostics' common stockholders - basic and
diluted
|
$
220
|
|
$
192
|
|
$
866
|
|
$
850
|
|
|
|
|
|
|
|
|
|
Weighted average common
shares outstanding - basic
|
111
|
|
112
|
|
111
|
|
112
|
|
Effect of dilutive
securities:
|
|
|
|
|
|
|
|
|
Stock options and
performance share units
|
2
|
|
1
|
|
2
|
|
1
|
|
Weighted average common
shares outstanding - diluted
|
113
|
|
113
|
|
113
|
|
113
|
|
|
|
|
|
|
|
|
|
Earnings per share
attributable to Quest Diagnostics' common
stockholders:
|
|
|
|
|
|
|
|
|
Basic
|
$
1.98
|
|
$
1.72
|
|
$
7.78
|
|
$
7.59
|
|
Diluted
|
$
1.95
|
|
$
1.70
|
|
$
7.69
|
|
$
7.49
|
|
2) The following
tables reconcile reported GAAP results to non-GAAP adjusted
results:
|
|
Three Months Ended
December 31, 2024
|
|
(dollars in
millions, except per share data)
|
|
Operating
income
|
|
Operating
income as a
percentage of
net revenues
|
|
Income tax
expense (e)
|
|
Equity in
earnings of
equity method
investees,
net of taxes
|
|
Net income
attributable
to Quest
Diagnostics
|
|
Diluted
EPS
|
|
As reported
|
$
361
|
|
13.8 %
|
|
$
(68)
|
|
$
5
|
|
$
222
|
|
$
1.95
|
|
Restructuring and
integration charges (a)
|
17
|
|
0.6
|
|
(5)
|
|
—
|
|
12
|
|
0.11
|
|
Other charges
(b)
|
(6)
|
|
(0.2)
|
|
—
|
|
—
|
|
(6)
|
|
(0.06)
|
|
Gains and losses on
investments (c)
|
—
|
|
—
|
|
(1)
|
|
4
|
|
3
|
|
0.03
|
|
Other gains
(d)
|
—
|
|
—
|
|
1
|
|
—
|
|
(3)
|
|
(0.02)
|
|
Amortization
expense
|
37
|
|
1.4
|
|
(9)
|
|
—
|
|
28
|
|
0.25
|
|
ETB
|
—
|
|
—
|
|
(3)
|
|
—
|
|
(3)
|
|
(0.03)
|
|
As adjusted
|
$
409
|
|
15.6 %
|
|
$
(85)
|
|
$
9
|
|
$
253
|
|
$
2.23
|
|
|
|
Twelve Months Ended
December 31, 2024
|
|
(dollars in
millions, except per share data)
|
|
Operating
income
|
|
Operating
income as a
percentage of
net revenues
|
|
Income tax
expense (e)
|
|
Equity in
earnings of
equity method
investees,
net of taxes
|
|
Net income
attributable
to Quest
Diagnostics
|
|
Diluted
EPS
|
|
As reported
|
$
1,346
|
|
13.6 %
|
|
$
(273)
|
|
$
19
|
|
$
871
|
|
$
7.69
|
|
Restructuring and
integration charges (a)
|
62
|
|
0.6
|
|
(15)
|
|
—
|
|
47
|
|
0.42
|
|
Other charges
(b)
|
6
|
|
0.1
|
|
—
|
|
—
|
|
5
|
|
0.04
|
|
Gains and losses on
investments (c)
|
—
|
|
—
|
|
(4)
|
|
15
|
|
11
|
|
0.10
|
|
Other gains
(d)
|
—
|
|
—
|
|
3
|
|
—
|
|
(9)
|
|
(0.08)
|
|
Amortization
expense
|
127
|
|
1.3
|
|
(32)
|
|
—
|
|
95
|
|
0.84
|
|
ETB
|
—
|
|
—
|
|
(9)
|
|
—
|
|
(9)
|
|
(0.08)
|
|
As adjusted
|
$
1,541
|
|
15.6 %
|
|
$
(330)
|
|
$
34
|
|
$
1,011
|
|
$
8.93
|
|
|
|
Three Months Ended
December 31, 2023
|
|
(dollars in
millions, except per share data)
|
|
Operating
income
|
|
Operating
income as a
percentage of
net revenues
|
|
Income tax
expense (e)
|
|
Equity in
earnings of
equity method
investees,
net of taxes
|
|
Net income
attributable
to Quest
Diagnostics
|
|
Diluted
EPS
|
|
As reported
|
$
267
|
|
11.7 %
|
|
$
(40)
|
|
$
8
|
|
$
192
|
|
$
1.70
|
|
Restructuring and
integration charges (a)
|
11
|
|
0.5
|
|
(2)
|
|
—
|
|
9
|
|
0.07
|
|
Other charges
(b)
|
33
|
|
1.4
|
|
(6)
|
|
—
|
|
27
|
|
0.23
|
|
Amortization
expense
|
27
|
|
1.2
|
|
(8)
|
|
—
|
|
19
|
|
0.17
|
|
ETB
|
—
|
|
—
|
|
(2)
|
|
—
|
|
(2)
|
|
(0.02)
|
|
As adjusted
|
$
338
|
|
14.8 %
|
|
$
(58)
|
|
$
8
|
|
$
245
|
|
$
2.15
|
|
|
|
Twelve Months Ended
December 31, 2023
|
|
(dollars in
millions, except per share data)
|
|
Operating
income
|
|
Operating
income as a
percentage of
net revenues
|
|
Income tax
expense (e)
|
|
Equity in
earnings of
equity method
investees,
net of taxes
|
|
Net income
attributable
to Quest
Diagnostics
|
|
Diluted
EPS
|
|
As reported
|
$
1,262
|
|
13.6 %
|
|
$
(248)
|
|
$
26
|
|
$
854
|
|
$
7.49
|
|
Restructuring and
integration charges (a)
|
43
|
|
0.5
|
|
(10)
|
|
—
|
|
33
|
|
0.29
|
|
Other charges
(b)
|
44
|
|
0.5
|
|
(8)
|
|
—
|
|
36
|
|
0.31
|
|
Gains and losses on
investments (c)
|
—
|
|
—
|
|
(1)
|
|
3
|
|
2
|
|
0.02
|
|
Amortization
expense
|
108
|
|
1.2
|
|
(28)
|
|
—
|
|
80
|
|
0.70
|
|
ETB
|
—
|
|
—
|
|
(11)
|
|
—
|
|
(11)
|
|
(0.10)
|
|
As adjusted
|
$
1,457
|
|
15.8 %
|
|
$
(306)
|
|
$
29
|
|
$
994
|
|
$
8.71
|
|
(a)
|
For both the three and
twelve months ended December 31, 2024 and 2023, the pre-tax impact
represents costs primarily associated with workforce reductions and
integration costs incurred in connection with further restructuring
and integrating our business. The following table summarizes
the pre-tax impact of restructuring and integration charges on our
consolidated statements of operations:
|
|
|
|
Three Months Ended
December 31,
|
|
Twelve Months Ended
December 31,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
(dollars in
millions)
|
|
Cost of
services
|
$
8
|
|
$
4
|
|
$
27
|
|
$
16
|
|
Selling, general and
administrative
|
9
|
|
7
|
|
37
|
|
27
|
|
Other operating
(income) expense, net
|
—
|
|
—
|
|
(2)
|
|
—
|
|
|
|
|
|
|
|
|
|
Operating
income
|
$
17
|
|
$
11
|
|
$
62
|
|
$
43
|
|
(b)
|
For all periods
presented, other operating (income) expense, net includes pre-tax
(gains)/losses associated with the change in the fair value of the
contingent consideration accrual associated with previous
acquisitions. For both the three and twelve months ended
December 31, 2023, the pre-tax impact also includes a $29 million
impairment charge on certain long-lived assets related to the
shutdown of a business. The following table summarizes the
pre-tax impact of these other items on our consolidated statement
of operations:
|
|
|
|
Three Months Ended
December 31,
|
|
Twelve Months Ended
December 31,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
(dollars in
millions)
|
|
Cost of
services
|
$
2
|
|
$
—
|
|
$
2
|
|
$
—
|
|
Selling, general and
administrative
|
—
|
|
(2)
|
|
2
|
|
5
|
|
Other operating
(income) expense, net
|
(8)
|
|
35
|
|
2
|
|
39
|
|
Operating
income
|
$
(6)
|
|
$
33
|
|
$
6
|
|
$
44
|
|
(c)
|
For all periods
presented, the pre-tax impact primarily represents (gains) and
losses associated with changes in the carrying value of our
strategic investments, recorded in equity in earnings of equity
method investees, net of taxes.
|
|
|
|
(d)
|
The twelve months ended
December 31, 2024 principally includes a non-recurring $8 million
pre-tax gain associated with a foreign exchange forward contract
utilized in conjunction with an acquisition. For all periods
presented, all amounts are recorded in other income,
net.
|
|
|
|
(e)
|
For restructuring and
integration charges, gains and losses on investments, other charges
and gains, and amortization expense, income tax impacts, where
recorded, were primarily calculated using combined statutory income
tax rates of 25.5% for both 2024 and 2023.
|
|
3) For both the
three and twelve months ended December 31, 2024, we repurchased 0.9
million shares of our common stock for $150 million. As of December
31, 2024, $0.9 billion remained available under our share
repurchase authorization.
|
|
|
4) The outlook
for adjusted diluted EPS represents management's estimates for the
full year 2025 before the impact of special items. Further impacts
to earnings related to special items may occur throughout 2025.
Additionally, the amount of ETB is dependent upon employee stock
option exercises and our stock price, which are difficult to
predict. The following table reconciles our 2025 outlook for
diluted EPS under GAAP to our outlook for adjusted diluted
EPS:
|
|
Low
|
|
High
|
|
Diluted EPS
|
$
8.34
|
|
$
8.59
|
|
Restructuring and
integration charges (a)
|
0.11
|
|
0.11
|
|
Amortization expense
(b)
|
1.05
|
|
1.05
|
|
Other charges
(c)
|
0.13
|
|
0.13
|
|
ETB
|
(0.08)
|
|
(0.08)
|
|
Adjusted diluted
EPS
|
$
9.55
|
|
$
9.80
|
|
(a)
|
Represents estimated
pre-tax charges of $16 million primarily associated with workforce
reductions and integration costs incurred in connection with
further restructuring and integrating our business. Income
tax benefits were primarily calculated using a combined statutory
income tax rate of 25.5%.
|
|
|
|
(b)
|
Represents estimated
pre-tax amortization expenses of $160 million. Income tax
benefits were primarily calculated using a combined statutory
income tax rate of 25.5%.
|
|
|
|
(c)
|
Represents estimated
pre-tax net losses of $15 million, principally associated with the
increase in the fair value of the contingent consideration accrual
associated with previous acquisitions. No income tax benefits
are recorded on the losses associated with the contingent
consideration accrual.
|
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SOURCE Quest Diagnostics
