Quest Diagnostics Incorporated
Consolidated Statement of Operations
(in millions, except per share data)
Q1
Net revenues
$
Operating costs and expenses:
Cost of services
Selling, general, and administrative
Amortization of intangible assets
Gain on sale of royalty rights
Other operating expense (income), net
Total operating costs and expenses
Actual
2013
Q3
Q2
1,787
$
1,092
448
19
1
1,560
1,815
$
1,788
1,094
418
20
(6)
1,526
1,089
423
20
(474)
41
1,099
Q4
$
YTD
1,756
$
1,051
415
20
1,486
227
289
689
270
Other income (expense):
Interest expense, net
Equity in earnings of equity method investees
Other income (expense), net
Total non-operating expenses, net
(40)
6
4
(30)
(40)
7
(33)
(40)
5
3
(32)
(39)
6
1
(32)
Income from continuing operations before taxes
Income tax expense
Income from continuing operations
Income from discontinued operations, net of taxes
Net Income
Less: Net Income attributable to noncontrolling interests
Net Income attributable to Quest Diagnostics
197
73
124
20
144
(8)
136 $
256
95
161
13
174
(9)
165 $
657
245
412
2
414
(9)
405 $
238
87
151
151
(8)
143 $
116
20
136
152
13
165
403
2
405
143
143
Amounts attributable to Quest Diagnostics' common stockholders:
Income from continuing operations
Income from discontinued operations, net of taxes
Net income
$
$
Weighted average common shares outstanding - basic
Weighted average common shares outstanding - diluted
Diluted earnings per share attributable to Quest Diagnostics
Company common stockholders:
Income from continuing operations
Net income
$
$
158
159
$
$
0.72
0.85
$
$
153
154
$
$
0.99
1.07
$
$
150
151
$
$
2.66
2.68
0.97
0.97
$
1,475
(159)
24
8
(127)
$
$
146
146
$
$
7,146
4,326
1,704
79
(474)
36
5,671
Operating income
$
Q1
1,348
500
848
35
883
(34)
849
814
35
849
$
$
$
152
153
$
$
5.31
5.54
Q2
1,746
$
1,902
$
1,904
1,101
415
22
1,538
1,174
440
25
1
1,640
1,178
446
24
1,648
208
262
(39)
6
1
(32)
Q4
$
YTD
1,883
$
Actual
2015
Q2
Q1
7,435
$
1,839
$
1,925
$
256
257
983
228
301
529
(42)
6
3
(33)
(41)
7
(1)
(35)
(42)
7
1
(34)
(164)
26
4
(134)
(45)
7
(78)
(116)
(37)
7
(64)
(94)
(82)
14
(142)
(210)
176
65
111
111
(7)
104 $
229
87
142
142
(9)
133 $
221
82
139
139
(10)
129 $
223
28
195
5
200
(10)
190 $
849
262
587
5
592
(36)
556
104
104
133
133
129
129
185
5
190
551
5
556
$
0.71
0.71
$
$
144
145
$
$
0.92
0.92
$
$
145
145
$
$
0.88
0.88
$
$
145
146
$
$
1.26
1.29
$
3.78
3.81
112
42
70
70
(9)
61 $
$
61
$
61
$
$
145
145
$
$
1,182
429
20
(7)
1,624
3,764
4,637
1,728
94
(7)
6,452
$
1,163
419
21
8
1,611
YTD
1,184
427
23
(8)
1,626
144
145
$
$
Actual
2014
Q3
144
146
$
$
0.42
0.42
2,345
848
41
1
3,235
207
78
129
129
(11)
118 $
319
120
199
199
(20)
179
118
118
179
179
$
$
144
145
$
$
0.81
0.81
144
145
$
$
1.23
1.23
Key statistics and other data
Cost of sales as a percentage of net revenues
Selling, general & administrative as a percentage of net revenues
Operating Income as a percentage of net revenues
61.1%
25.1%
12.7%
60.2%
23.1%
15.9%
60.9%
23.7%
38.6%
59.9%
23.6%
15.3%
60.5%
23.9%
20.6%
63.1%
23.8%
11.9%
61.7%
23.1%
13.8%
61.9%
23.4%
13.4%
62.9%
22.6%
13.7%
62.4%
23.2%
13.2%
63.2%
22.8%
12.4%
61.4%
22.3%
15.6%
62.3%
22.5%
14.1%
Net Revenue Growth (Reduction)
-6.4%
-3.3%
-1.9%
-1.0%
-3.2%
-2.3%
4.8%
6.5%
7.2%
4.0%
5.3%
1.2%
3.2%
Diagnostic Information Services Revenue Growth (Reduction)
Volume Growth (Reduction)
Revenue/requisition Growth (Reduction)
-6.7%
-3.4%
-3.4%
-3.6%
0.1%
-3.7%
-2.4%
2.0%
-4.3%
-0.7%
2.3%
-3.0%
-3.4%
0.2%
-3.6%
-2.1%
0.7%
-2.8%
5.3%
7.7%
-2.3%
7.1%
7.8%
-0.6%
7.1%
8.8%
-1.5%
4.3%
6.3%
-1.8%
4.9%
5.6%
-0.7%
0.4%
-0.4%
0.9%
2.6%
2.4%
0.1%
4.0%
46
3.7%
48
3.6%
48
3.7%
47
3.8%
47
4.3%
49
3.9%
47
4.0%
46
3.8%
48
4.0%
48
4.3%
45
4.1%
44
4.2%
44
Bad Debt as a percentage of net revenues (continuing operations)
Days sales outstanding
Depreciation (continuing operations)
Capital Spending
Cash Paid for Share Repurchases
$
$
$
51
49
62
$
$
$
52
56
450
$
$
$
48
51
482
$
$
$
*This financial information should be used in conjunction with financial statements included in forms 10K and 10Q.
52
75
43
$
$
$
203
231
1,037
$
$
$
53
68
32
$
$
$
57
49
25
$
$
$
54
102
25
$
$
$
56
89
50
$
$
$
220
308
132
$
$
$
57
56
110
$
$
$
55
61
39
$
$
$
112
117
149
Quest Diagnostics Incorporated
Consolidated Balance Sheets
(in millions)
Actual
2013
June 30
September 30
March 31
Assets
Current assets:
Cash and cash equivalents
Accounts receivable, net
Inventories
Deferred income taxes
Prepaid expenses and other current assets
Current assets held for sale
Total current assets
Property, plant and equipment, net
Goodwill
Intangible assets, net
Other assets
Non-current assets held for sale
Total assets
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued expenses
Short-term borrowings and current portion of long-term debt
Current liabilities held for sale
Total current liabilities
$
$
$
Long-term debt
Other liabilities
Non-current liabilities held for sale
Stockholders' equity:
Quest Diagnostics stockholders' equity:
Common stock, par value $0.01 per share
Additional paid-in capital
Retained earnings
Accumulated other comprehensive income (loss)
Treasury stock, at cost
Quest Diagnostics stockholders' equity
Noncontrolling interests
Total stockholder's equity
Total liabilities and stockholders' equity
134
930
90
159
98
47
1,457
754
5,630
899
213
353
9,306
935
254
19
1,208
$
$
$
3,147
663
60
$
2
2,365
4,779
10
(2,956)
4,200
27
4,227
9,306 $
148
947
89
159
126
1,470
752
5,666
929
219
9,036
916
375
1,291
$
$
$
3,122
685
-
2
2,327
4,898
(13)
(3,303)
3,912
27
3,939
9,036 $
158
921
85
153
109
1,426
749
5,629
904
220
8,928
994
245
1,239
December 31
$
$
$
3,122
695
-
2
2,306
5,260
(8)
(3,718)
3,843
29
3,872
8,928 $
*This financial information should be used in conjunction with financial statements included in forms 10K and 10Q.
** As reported in the 2014 form 10-K
187
852
91
148
105
1,383
805
5,649
896
215
8,948
920
212
1,132
March 31
$
$
$
3,120
723
-
2
2,379
5,358
(8)
(3,783)
3,948
25
3,973
8,948
144
977
99
153
115
1,488
851
5,920
1,078
213
9,550
969
223
1,192
June 30
$
$
$
3,724
614
-
$
2
2,381
5,415
(11)
(3,795)
3,992
28
4,020
9,550 $
144
963
109
164
125
1,505
884
6,024
1,117
227
9,757
1,038
220
1,258
Actual
2014
September 30
$
$
$
3,738
642
-
2
2,394
5,500
(8)
(3,796)
4,092
27
4,119
9,757 $
170
953
111
165
164
1,563
888
6,026
1,095
229
9,801
1,058
132
1,190
Actual
2015
December 31 **
$
$
$
3,732
669
-
2
2,406
5,581
(15)
(3,792)
4,182
28
4,210
9,801 $
192
932
110
169
200
1,603
933
6,032
1,071
238
9,877
1,191
518
1,709
March 31
$
$
$
3,244
594
-
2
2,418
5,723
(27)
(3,815)
4,301
29
4,330
9,877
974
949
106
158
188
2,375
June 30
$
902
5,986
1,041
254
55
10,613
1,046
1,043
1,242
906
5,987
1,022
219
56
9,720
$
3,688
565
-
$
150
937
109
161
173
1,530
2
2,427
5,729
(30)
(3,885)
4,243
28
4,271
10,613 $
1,074
168
1,242
3,568
566
-
2
2,444
5,793
(25)
(3,900)
4,314
30
4,344
9,720
Quest Diagnostics Incorporated
Consolidated Statements of Cash Flows
(in millions)
Three Months
Ended
March 31
Cash flows from operating activities:
Net income
Adjustments to reconcile net income (loss) to net cash
provided by operating activities:
Depreciation and amortization
Provision for doubtful accounts
Deferred income tax (benefit) provision
Stock compensation expense
Excess tax benefits from stock-based
compensation arrangements
Non-cash portion of loss on extinguishment of debt
Gain on sale of royalty rights
Asset impairment and (gain) loss on sale of businesses
Other, net
Changes in operating assets and liabilities:
Accounts receivable
Accounts payable and accrued expenses
Income taxes payable
Other assets and liabilities, net
Net cash provided by operating activities
$
$
70
72
(1)
(4)
(474)
17
2
(132)
(77)
(29)
(4)
47
(213)
(68)
(35)
(8)
255
(252)
(77)
77
(13)
442
(90)
(49)
-
(180)
(105)
266
-
(1)
(140)
Actual
2014
Six Months
Nine Months
Ended
Ended
June 30
September 30
Three Months
Ended
March 31
$
111
$
253
$
392
Year Ended
December 31
$
592
Actual
2015
Three Months
Six Months
Ended
Ended
March 31
June 30
$
70
75
75
(10)
12
156
148
(26)
25
235
224
(21)
38
314
296
23
51
78
79
14
12
-
-
-
(2)
1
$
199
153
158
(5)
27
(2)
(2)
(5)
(12)
(247)
(21)
(93)
(11)
652
(152)
(86)
70
(9)
84
(191)
(39)
44
(4)
364
(260)
20
22
(10)
635
(312)
68
(84)
2
938
(97)
(120)
10
1
52
(163)
(49)
17
(2)
327
(180)
(156)
296
474
(213)
(231)
296
474
(567)
(68)
-
(723)
(117)
-
(725)
(219)
-
(728)
(308)
-
(56)
-
(6)
(117)
-
(19)
(2)
434
2
328
(1)
(636)
(1)
(841)
10
(934)
11
(1,025)
1
(55)
(123)
176
(132)
(62)
14
578
(415)
(512)
63
790
(757)
(994)
98
896
(900)
(1,037)
138
1,513
(923)
(32)
12
1,738
(1,159)
(57)
30
1,953
(1,466)
(82)
55
2,018
(1,647)
(132)
78
1,389
(440)
(110)
35
1,829
(1,821)
(149)
55
1
(48)
(3)
(6)
(60)
3
(95)
(13)
(10)
(401)
4
(141)
(21)
(7)
(1,030)
4
(185)
(32)
10
(1,106)
(43)
(3)
(15)
509
(91)
(14)
(13)
434
(139)
(23)
(16)
282
(187)
(31)
(7)
92
2
(48)
(10)
(33)
785
3
(103)
(19)
(41)
(246)
(153)
(165)
(155)
(126)
(43)
(43)
(17)
782
(42)
17
17
17
-
-
-
-
-
-
296
296
296
187
187
187
187
192
192
296
$
883
(4)
(474)
17
(1)
(9)
Cash and cash equivalents, beginning of
year
$
(3)
(22)
(1)
(1)
Change in cash and cash equivalents included
in assets held for sale
732
283
270
19
28
-
Net change in cash and cash equivalents
$
211
204
(3)
24
5
Cash flows from financing activities:
Proceeds from borrowings
Repayments of debt
Purchases of treasury stock
Exercise of stock options
Excess tax benefits from stock-based
compensation arrangements
Dividends paid
Distributions to noncontrolling interests
Other financing activities
Net cash (used in) provided by financing activities
318
Year Ended
December 31
142
139
(11)
17
-
Cash flows from investing activities:
Business acquisitions, net of cash acquired
Capital expenditures
Proceeds from sale of businesses
Proceeds from sale of royalty rights
(Increase) decrease in investments and other
assets
Net cash (used in) provided by investing activities
Cash and cash equivalents, end of period
144
Six Months
Ended
June 30
Actual
2013
Nine Months
Ended
September 30
134
$
148
$
159
*This financial information should be used in conjunction with financial statements included in forms 10K and 10Q.
$
187
$
144
$
144
$
170
6
5
$
192
(3)
-
$
974
(5)
$
150
Quest Diagnostics Incorporated
Supplemental Revenue Information
(in millions)
**
2013
2014
Revenue by product
Clinical testing revenues:
Gene-based and esoteric
Anatomic pathology
Total gene-based, esoteric and anatomic pathology
Routine
Drugs of abuse
Total clinical testing revenues
Other
Total revenues
1,811
694
2,505
3,868
213
6,586
$
559
7,145
1,864
633
2,497
4,145
231
6,873
$
562
7,435
Revenue by payer
Clinical testing revenues:
Managed care
Medicare & Medicaid
Hospital and reference laboratories
Patient
Physician and other
Employer
Total clinical testing revenues
Other
Total revenues
3,326
1,262
1,046
168
512
273
6,587
$
559
7,146
3,453
1,282
1,031
169
585
353
6,873
$
562
7,435
* This financial information should be used in conjunction with financial statements included in forms 10K and 10Q.
** This financial information includes immaterial reclassifications to conform with the current year presentation.