Idexx Laboratories (NASDAQ:IDXX) delivered a sizzling 40% gain in 2019, handily beating the overall market. The animal healthcare company's companion animal business especially performed well.
But Idexx's strong momentum faced a test when the company provided its fiscal 2019 fourth-quarter and full-year update before the market opened on Friday. Here are the highlights from Idexx's Q4 results.
By the numbers
Idexx announced fourth-quarter revenue of $605.4 million, up 10% year over year. This result topped the average analysts' revenue estimate of $600.6 million.
The company reported net income of $90.5 million, or $1.04 per share, based on generally accepted accounting principles (GAAP). This reflected improvement from the GAAP net income of $85.7 million, or $0.98 per share, recorded in the same quarter in 2018. It also beat the consensus Wall Street Q4 earnings estimate of $0.90 per share.
Idexx ended the fourth quarter with cash and cash equivalents totaling $90.3 million. The company had $123.8 million on hand at the end of the prior-year period.
Behind the numbers
The company's companion animal group (CAG) was again the primary driver of Idexx's growth in the fourth quarter. Sales for the unit jumped 11% year over year to $529.8 million. Growth was similar in U.S. and international markets. Reference laboratory diagnostic and consulting services generated $201 million of CAG's total revenue, up 12.6% year over year.
Sales for Idexx's water business in Q4 rose 8.5% year over year to $32.9 million. While the international market was the bigger source of revenue, contributing $18.4 million in sales in Q4, the U.S. market grew faster, with revenue increasing by 9.7% year over year to $14.5 million.
Idexx's livestock, poultry, and dairy (LPD) business also performed well in the fourth quarter. LPD revenue jumped 8.1% year over year to $36.7 million, with U.S. sales rising more than twice as much as international sales. The company said that its LPD business benefited from "year-end government and distributor order timing" as well as from "African Swine Fever diagnostic testing programs in China and growth in diagnostic testing associated with alternate food sources, such as poultry."
Idexx now anticipates full-year 2020 revenue will be between $2.62 million and $2.65 million, compared to its previous guidance of revenue between $2.61 million and $2.65 million. The company also projected 2020 earnings per share (EPS) will be between $5.42 and $5.58, up from the range of $5.30 to $5.46 provided in its previous outlook.
CEO Jay Mazelsky noted Idexx's achievements in 2019 and said, "We are well positioned to build on this progress in 2020, leveraging our expanded global commercial capability and unique innovations, which support continued strong diagnostics market growth driven by the adoption of higher standards of care for pets globally."
Idexx's focus on pet care differentiates it from most healthcare stocks, so the potential volatility from the 2020 U.S. presidential election shouldn't be an issue for the company. However, Idexx's international business makes it highly susceptible to foreign exchange fluctuations.