Laboratory of America Holdings Earnings Call Insights: Positive Drivers and Moratorium on Acquisitions
Laboratory Corporation of America Holdings (NYSE:LH) recently reported its fourth quarter earnings and discussed the following topics in its earnings conference call.
Thomas Gallucci – Lazard Capital Markets: I guess I had two questions. The first one was sort of on the ’13 outlook obviously Medicare is a big negative, but wondering, what if you could highlight some of the positive drivers that overcome some of the pressures on the business as you look out. In the past you’ve talked about Genzyme and MEDTOX sort of ramping up is that still the case. So if you could just explore some of the positive versus the negative as we think about the ’13 moving parts?
William B. Hayes – EVP and CFO: I’d like to say couple of things to answer your question. One is obviously we face the Medicare cuts that we described and you referred to. Secondly, we have some offset of those cuts from increases in payment from other payer types that are non-government. So there’s one thing that helps to offset. We also have continued acquisition integration from Genzyme and some of the other acquisitions that we’ve done since that date that also helped to offset. Given the 2% to 3% top line revenue guidance, we still think of it as a low organic growth environment, which is what I think keeps some of the positives from offsetting the negative from the payment reduction.
David P. King – Chairman and CEO: Tom, it’s Dave. Just to add one further point. We’re encouraged that organic volume growth increased sequentially from 3Q to 4Q. So we have some cautious optimism that we’re going to see better organic volume growth as we go forward through 2013.