Courtesy / IDEXX Laboratories Inc.
IDEXX President and CEO Jay Mazelsky
Updated: May 4, 2021
IDEXX beats Q1 earnings and revenue forecasts, raises 2021 guidance
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IDEXX Laboratories Inc., whose Westbrook headquarters are shown here, has a global footprint.
IDEXX Laboratories Inc. (Nasdaq: IDXX) on Tuesday posted first-quarter results that surpassed market forecasts and raised its 2021 outlook to reflect expectations for higher organic revenue growth and better operating margins.
The Westbrook-based provider of veterinary diagnostics, veterinary practice software and water microbiology testing said that first-quarter revenue was $778 million, an increase of 24% on a reported basis and 21% higher organically over a year earlier. That exceeded the consensus forecast of analysts polled by Zacks Investment Research by 5.87%.
Earnings per diluted share of $2.35 represents 82% growth as reported and 73% on a comparable basis, beating the Zacks consensus estimate of $1.72 per share.
The company attributed the earnings increase to strong operating margin gains, reflecting benefits from high recurring revenue growth in its Companion Animal Group diagnostics division and favorable comparisons to higher operating expense levels in pre-pandemic years.
“The IDEXX team delivered exceptional performance in the first quarter, reflecting continued robust demand for companion animal health care globally, supported by our innovation and direct commercial engagement,” IDEXX President and CEO Jay Mazelsky said in Tuesday's release.
He added, "Our best in class in clinic platforms and unparalleled global lab services capabilities, integrated with our cloud-based information management solutions, position us to drive accelerated development of the global standard of health care for companion animals."
Later in a morning conference call with investors and analysts, Mazelsky said the strong start to the year gives the company confidence of strong profit and revenue gains in 2021.
In late-morning trading, IDEXX shares were 3.32% lower at $531.64, while the NASDAQ composite index was down 2.46%. The company has a current market capitalization of close to $46.2 billion.
IDEXX's Companion Animal Group had the strongest performance of the company's three divisions, while the company's overall operating margin was 31.8% higher in the quarter or 880 basis points above a year earlier as reported and 830 basis points higher on a comparable basis.
Gross profits increased 31% as reported and 28% on a comparable basis.
The company said it's planning for moderated gross margin gains and higher levels of operating expense growth for the rest of the year in comparison to tightly controlled spending levels in prior years "and as we advance investments to support our continued strong global growth momentum."
Updated guidance
As for its 2021 outlook, IDEXX raised its earnings per share guidance to a range of $7.88 to $8.18 a share, compared to previous guidance of $7.39 to $7.91 a share of three months ago.
It also raised its 2021 revenue guidance to a range of $3.105 billion to $3.16 billion, reflecting expectations for higher revenue growth and targeted operating margin improvements.
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