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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
APRIL 25, 1997
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(Date of earliest event reported)
LABORATORY CORPORATION OF AMERICA HOLDINGS
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(Exact name of registrant as specified in its charter)
DELAWARE 1-11353 13-3757370
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(State or other (Commission (IRS Employer
jurisdiction or File Number) Identification
organization) Number)
358 SOUTH MAIN STREET, BURLINGTON, NORTH CAROLINA 27215
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(Address of principal executive offices)
910-229-1127
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(Registrant's telephone number, including area code)
ITEM 5. OTHER EVENTS
On April 25, 1997, Laboratory Corporation of America Holdings (the
"Company") issued a press release dated as of such date announcing operating
results for the three month period ended March 31, 1997, as well as certain
other information. The press release is attached as an exhibit hereto and
the text thereof is incorporated in its entirety herein by reference.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL
INFORMATION AND EXHIBITS
(c) Exhibit
20 Press release of the Company dated April 25, 1997.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
LABORATORY CORPORATION OF AMERICA HOLDINGS
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(Registrant)
By: /s/ BRADFORD T. SMITH
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Bradford T. Smith
Executive Vice President,
General Counsel and Secretary
Date: April 30, 1997
FOR IMMEDIATE RELEASE
Contact: Pamela Sherry
Telephone: 910-229-1127,Ext. 4855
LABORATORY CORPORATION OF AMERICA-TM- REPORTS
FIRST QUARTER RESULTS
Burlington, NC, April 25, 1997 - Laboratory Corporation of America-TM-
Holdings (LabCorp-TM-) (NYSE: LH) today announced results for the quarter
ended March 31, 1997.
Net sales for the quarter were $391.5 million, versus $403.9 million in the
first quarter of 1996. In the first quarter of 1997, the Company posted
operating income of $27.8 million, net income of $2.4 million, and earnings
per share of $0.02. This compares with operating income of $27.8 million,
net income of $5.9 million, and earnings per share of $0.05 in the same
period in 1996.
"We are satisfied with the progress LabCorp made in the first quarter," said
Thomas P. Mac Mahon, President and Chief Executive Officer. "This was our
first quarter in two years that price has increased over the prior year's
comparable period. Although our sales were approximately $12 million lower
than the first quarter of 1996, expense reductions in the first quarter of
1997 offset this revenue decline, allowing us to maintain our operating
income at a level equal to the comparable period in 1996." The lower
revenue in 1997 reflects a decline in volume consistent with industry trends
as well as the Company's program of selectively eliminating unprofitable
accounts and carefully evaluating the acceptability of new business.
"In addition, on flat sales, our operating income for the first quarter of
1997 represents a 27% increase when compared to operating income for the
fourth quarter of 1996," said Mr. Mac Mahon. "This improvement is a direct
result of our continuing efforts to reduce costs and increase price."
The Company initiated a number of new cost reduction programs in the first
quarter. "We are proud of our proven ability to deliver high-quality
services and maintain a low-cost provider status," said Mr. Mac Mahon.
"Additionally, we are increasing our emphasis on actively pursuing
profitable new growth opportunities that add volume and capitalize on our
extensive service capabilities."
Recently, the Company finalized a multi-year, preferred provider agreement
with United Healthcare Corporation (NYSE: UNH), one of the nation's largest
health care services organizations. Under the national agreement, LabCorp is
eligible to provide clinical laboratory testing services for up to 10
million persons served by United's health plans and preferred provider
networks.
In connection with its previously announced rights offering, in March the
Company entered into the Sixth Amendment and Waiver to its existing credit
agreement. LabCorp also entered into an amended and restated credit
agreement with its current lenders, which will become effective upon
completion of the rights offering and will make available a term loan
facility of approximately $654 million and a revolving credit facility of
$450 million, based on the current structure of the rights offering.
The Company noted that each of the above forward-looking statements was
subject to change based on various important factors, including without
limitation, competitive actions in the marketplace and adverse actions of
governmental and other third-party payors. Further information on potential
factors that could affect the Company's financial results is included in the
Company's Form 10-K for the year ended December 31, 1996.
Laboratory Corporation of America-TM- Holdings (LabCorp-TM-) is a national
clinical laboratory organization with estimated annualized revenues of $1.6
billion. The Company operates primary testing facilities nationally,
offering more than 1,700 different clinical assays, from routine blood
analysis to more sophisticated technologies. LabCorp performs diagnostic
tests for physicians, managed care organizations, hospitals, clinics, long-
term care facilities, industrial companies and other clinical laboratories.
LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES
SUMMARIZED FINANCIAL INFORMATION
(DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED
MARCH 31,
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1997 1996
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Net Sales $391.5 $403.9
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EBITDA $ 49.3 $ 48.4
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Operating income $ 27.8 $ 27.8
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Earnings before income taxes $ 5.9 $ 11.8
Provision for income taxes (3.5) (5.9)
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Net earnings $ 2.4 $ 5.9
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Net earnings per common share $ 0.02 $ 0.05
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Earnings per common share are based on the weighted average number of
shares outstanding during the three-month periods ended March 31,
1997 and 1996 of 122,935,080 and 122,908,722 shares, respectively.