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August 13, 2020

After previous losses, Covetrus reports $54M earnings for Q2

Portland-based Covetrus Inc. (Nasdaq: CVET) appears to be turning around recent financial performance, reporting an uptick in second-quarter revenue and earnings Tuesday.

The animal-health technology and services company, which struggled last year amid leadership changes and recorded a widening net loss earlier this year, recorded net sales of $1.03 billion, an increase of 2% year-over-year for the three months ended June 30.

Covetrus’ net income was $54 million for the quarter, or 40 cents per share, compared to a net loss of $10 million, or 9 cents per share, in the second quarter of 2019. For the first quarter of 2020, the company reported a loss of $33 million.

Covetrus said in the news release that the “primary driver” of this year’s Q2 earnings was a $70 million after-tax gain on the sale of a German subsidiary, scil animal care.

In addition, organic net sales increased 5% year-over-year, due to growth in the company's prescription management and supply chain businesses.

At quarter-end, the company had $414 million in cash and cash equivalents, $1.14 billion in term loan debt, and no borrowings outstanding on its $300 million revolving credit line.

“I am extremely proud of our team’s exceptional efforts and accomplishments during the second quarter to support our customers around the globe during COVID-19,” said Ben Wolin, Covetrus president and CEO.

“While uncertainties tied to the global pandemic and the pace and recovery of our end-market remain, continued investments in our organizational health, innovation and customer success puts us in a strong position to capitalize on our strategic opportunities and to deliver shareholder value in the quarters and years ahead.”

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