Quest Diagnostics Discusses Progress in Executing Strategy to Drive Shareholder Value and Presents Outlook at Investor Day
Senior management team speakers including
- Restoring growth, including an expected 3.5% increase in revenues in 2014.
- Enhancing efficiency and delivering an expected
$700 millionin run-rate savings exiting 2014 through the company's Invigorate program – exceeding its target.
- Simplifying and strengthening the organization to drive growth and operational excellence.
- Refocusing on Quest's core diagnostic information services business, generating
$800 millionin asset sale proceeds.
- Returning cash to shareholders with over
$1 billionin share repurchases, raising dividends three times since 2011, and investing $1 billionin seven acquisitions in the past two years.
The presentations by Quest senior management will highlight the company's continued focus on opportunities in its core business and will emphasize the following:
- Revenue growth: The company expects to continue to achieve sequential improvement in organic revenue growth, with overall average revenue growth of 2% to 5% over the next three years. This expected revenue growth includes potential acquisitions.
- Cost savings: The company expects to deliver
$600 millionin additional total run-rate savings over the next three years, bringing the total run-rate savings expected at the end of 2017 to approximately $1.3 billion. The company has identified key opportunities to meet this goal, including the standardization of processes, information technology and equipment, which also support the company's efforts to deliver a superior customer experience.
- Over the next three years, Quest expects to achieve 8% to 10% adjusted diluted EPS growth on average, excluding the benefit of share repurchases.
- In 2015, Quest intends to report financial results and provide guidance using adjusted diluted EPS excluding amortization, which is a commonly used metric by a number of industry peers. The company estimates full year 2014 amortization charges will be approximately
$0.40per diluted share. Adjusted diluted EPS excluding amortization is expected to grow 8% to 10% on average over the next three years, excluding the benefit of share repurchases.
- Quest intends to continue to return the majority of the free cash flow it generates to shareholders through share repurchases and dividends.
Reaffirming Outlook for 2014
In the course of the meeting,
- Revenues expected to increase approximately 3.5% compared to the prior year;
- Adjusted diluted EPS to be between
$4.03 and $4.07;
- Cash provided by operations to approximate
$900 million; and
- Capital expenditures to approximate
A live webcast of the event will be broadcast simultaneously on the Investor Relations page of the
The statements in this press release which are not historical facts may be forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date that they are made and which reflect management's current estimates, projections, expectations or beliefs and which involve risks and uncertainties that could cause actual results and outcomes to be materially different. Risks and uncertainties that may affect the future results of the company include, but are not limited to, adverse results from pending or future government investigations, lawsuits or private actions, the competitive environment, changes in government regulations, changing relationships with customers, payers, suppliers or strategic partners and other factors discussed in the company's most recently filed Annual Report on Form 10-K and in any of the company's subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, including those discussed in the "Business," "Risk Factors," "Cautionary Factors that May Affect Future Results" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of those reports.