Laboratory Corp. of America Holdings Q3 2009 Earnings Call Transcript

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2009-10-22 12:02:18.0

Tags: Hayes Corp., Revenue, U.S. Bancorp Piper Jaffray Inc., Call Transcript, Earnings, Laboratory Corp. Of America Holdings, Operational Accounting, Government, Finance, Seeking Alpha, Laboratory Corp. of America Holdings

Question-and-Answer Session

Operator

(Operator's Instructions) Your first question comes from the line of Bill Quirk with Piper Jaffray.

Bill Quirk - Piper Jaffray

Thanks, good morning. Thanks very much for the call on the volume impact on the termination of the two government contracts. I believe you indicated that at least one of these was priced below the corporate average. Can you talk a little bit about what impact, and I assume it was probably slightly positive, that had on the revenue per requisition here?

William B. Hayes

We're not specifically breaking that out, but they were lower priced than the average.

Bill Quirk - Piper Jaffray

So said another way there was a positive, if slight, impact of that metric then?

William B. Hayes

Yes. I would say very slight.

Bill Quirk - Piper Jaffray

Okay. And then just looking at guidance guys, if we take a look at the upside here in the quarter on the bottom line and then also just considering the integration of monogram into the operations, no change to the revenue guidance. Is this a function of the government contracts? And then on the EPS side if you could just give us a little color there?

William B. Hayes

On the revenue side, I mean we say approximately 4%. We've obviously got the loss of the contracts as you mentioned, offset by monogram so we're comfortable with maintaining that 4% on the revenue line. On the EPS, and I mean there's a table in the press release, but I'll just talk through how we think about it. Prior to monogram we were 485 to 495 for the full year of EPS. Monogram operations we estimated and still believe will be $0.08 diluted. So that brings us to an adjusted total of $4.77-$4.87.

This quarter we are updating that guidance to $4.84 to $4.89, so that's the way we think about that guidance. And one thing I might add is that excludes any estimates of the transaction related fees.

Bill Quirk - Piper Jaffray

Understood. Last question for me, and again just kind of sticking on Monogram here, what was the contribution from both Monogram as well as, for that matter, any of the other smaller lab acquisitions that you've done specifically for the quarter?

William B. Hayes

We're not, again, specifically breaking out acquisitions like Monogram. That has been probably the only one of any size that we've done during the quarter. I would just say that it's very low on the volume side that you would see it show up. It's very much above our average price pre transaction so it is helping on the price metric.

 

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