IDEXX beats estimates on Q1 results, says it's 'well-positioned' for recovery
IDEXX Laboratories Inc. (Nasdaq: IDXX) on Thursday posted first-quarter results that beat market estimates and said it's well-positioned for a recovery in market conditions, after taking steps to control costs during the pandemic.
The Westbrook-based provider of veterinary diagnostics, veterinary practice software and water microbiology testing reported second-quarter earnings of $1.29 a share, exceeding the $1.23 Zacks Investment Research analyst consensus forecast and 10% higher than last year on a reported basis.
First-quarter revenues amounted to $626.34 million, an increase of 9% on a reported and organic basis over last year.
IDEXX said Thursday's results reflected 10% recurring revenue growth in its companion animal group diagnostics division, supported by double-digit organic gains in both U.S. and international markets.
Results were also supported by strong gains in its livestock, poultry and dairy businesses, partly helped by an estimated $5 million in accelerated stocking orders in those areas related to the pandemic, the company said.
Jay Mazelsky, the company's president and CEO, said in a statement that the company has continued to provide high levels of service delivery and product support for its veterinary customers during the pandemic while advancing steps to protect the safety and health of its employees, ensure business continuity and mitigate the near-term impacts of demand for its products and services.
"The pet-owner bond is stronger than ever, and IDEXX's strategy, opportunity and fundamentals remain intact, supported by our innovative product portfolio and talented global team," he said. "We are very well-positioned for a strong recovery in the highly attractive and resilient companion animal healthcare market."
IDEXX shares at noon were up 1.6% to $277.21, giving it a market capitalization of around $23.2 billion. Shares pared some gains after rising as high as $289.
Both Mazelsky and CFO Brian McKeon reiterated that message in a morning call with analysts.
Mazelsky also noted that while veterinary practices initially struggled to adapt their work flow and a drop-off in visits at the start of the crisis, IDEXX has worked with customers to help them adapt with curb-side pickup and remote check-ins and payments.
"We'll see how it develops over time, but I think the trends are positive," he said.
Citing the ongoing crisis, IDEXX withdrew its 2020 financial guidance less than a week before its annual shareholders meeting, which will take place virtually via an audio webcast.
IDEXX also gave a brief product update, saying that a COVID-19 test for humans developed by its Roswell, Ga.-based subsidiary, OPTI Medical Systems, has applied for US. Food and Drug Administration Emergency Use Authorization.
Mazelsky told analysts on the morning call that the test, developed with IDEXX's expertise in developing and manufacturing infectious disease tests for livestock, is highly effective in terms of specificity and that results are typically ready in "well under" four hours.
Earlier this month, IDEXX made its COVID-19 test for pets available to veterinarians in response to customer demand and growing evidence that in rare cases, pets living with COVID-19 positive humans can be at risk for infection.
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