Idexx Laboratories (IDXX) has reported a 39.99 percent plunge in profit for the quarter ended Dec. 31, 2014. The company has earned $25.96 million, or $0.54 a share in the quarter, compared with $43.26 million, or $0.82 a share for the same period last year. Revenue during the quarter went down marginally by 0.60 percent to $351.96 million from $354.07 million in the previous year period. Gross margin for the quarter contracted 153 basis points over the previous year period to 51.76 percent. Total expenses were 90.11 percent of quarterly revenues, up from 82.68 percent for the same period last year. That has resulted in a contraction of 743 basis points in operating margin to 9.89 percent.
Operating income for the quarter was $34.80 million, compared with $61.33 million in the previous year period.
"We are very pleased with the market and financial performance we achieved in the quarter, in particular the record levels of premium instrument placements that we reported earlier in the month and the continued strength in our CAG Diagnostics recurring revenue in both the US and international operations. CAG Diagnostics recurring revenue grew in total over 11% on a normalized organic basis," said Jonathan Ayers, the Company's chairman and chief executive officer.
For the fiscal year of 2015 the company expects net income in the range of $1640 and $1660. For the fiscal year of 2015 the company expects net income growth rate in the range of 13.5% and 14.5% For the fiscal year of 2015 the company expects EPS in the range of 4.33 and 4.43.
Operating cash flow falls marginally Idexx Laboratories has generated cash of $235.85 million from operating activities during the year, down 4.13 percent or $10.15 million, when compared with the last year.
The company has spent $80.41 million cash to meet investing activities during the year as against cash outgo of $86.06 million in the last year.
The company has spent $103.44 million cash to carry out financing activities during the year as against cash outgo of $102.45 million in the last year period. It has made net debt repayment of $270.61 million. It has spent net of $588.72 million on repurchase of common stocks.
Cash and cash equivalents stood at $322.54 million as on Dec. 31, 2014, up 15.58 percent or $43.48 million from $279.06 million on Dec. 31, 2013.
Working capital turns negative
Working capital of Idexx Laboratories has turned negative to $61.51 million on Dec. 31, 2014 from positive $174.35 million on Dec. 31, 2013. Current ratio was at 0.93 as on Dec. 31, 2014, down from 1.36 on Dec. 31, 2013.
Cash conversion cycle (CCC) has increased to 51 days for the quarter from 49 days for the last year period. Days sales outstanding were almost stable at 20 days for the quarter, when compared with the last year period.
Days inventory outstanding has increased to 43 days for the quarter compared with 37 days for the previous year period. At the same time, days payable outstanding went up to 12 days for the quarter from 8 for the same period last year.
Debt increases substantially
Idexx Laboratories has witnessed an increase in total debt over the last one year. It stood at $549 million as on Dec. 31, 2014, up 28.15 percent or $120.61 million from $428.39 million on Dec. 31, 2013. Total debt was 39.66 percent of total assets as on Dec. 31, 2014, compared with 34.81 percent on Dec. 31, 2013. Debt to equity ratio was at 4.67 as on Dec. 31, 2014, up from 0.83 as on Dec. 31, 2013. Interest coverage ratio decreased to 7.05 for the quarter from 44.80 for the same period last year.
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