Full Press Release Details
Quest Diagnostics to Highlight Strategic Priorities
to Drive Sustainable
Growth and Deliver Long-term Shareholder Value
at 2025 Investor Day
SECAUCUS, N.J., March 19, 2025 -- At a meeting with analysts
and investors at its 2025 Investor Day, members of the leadership team of Quest Diagnostics (NYSE: DGX), a leading provider of diagnostic
information services, will discuss the company's strategies to drive sustainable growth and deliver long-term shareholder value.
"We are confident in Quest's ability to grow at above-market
rates in our core physician and hospital channels driven by increased market access, double-digit growth in advanced diagnostics across
five key clinical areas, and the contributions of strategic partnerships and acquisitions," said Jim Davis, Chairman, CEO and President.
"We expect our continuous improvement initiatives - including investments in automation, robotics, and AI - to strengthen
quality, customer and employee experiences, and productivity. Further, our new Project Nova IT initiative will modernize our systems architecture
and lower IT costs over the long-term. These factors are reflected in the long-term outlook we are articulating today, which anticipates
revenue growth at a 4-5% CAGR and adjusted EPS growth at a 7-9% CAGR beyond 2025."
At the meeting, members of the company's leadership team
will highlight a range of strategic initiatives that are underway, including:
Guidance for Full Year 2025
The company today reaffirmed its guidance for full year 2025,
as per the table below. For the first quarter of 2025, the company now expects that worse-than-anticipated
weather during the period will create a headwind to revenue of approximately $25 million and to EPS of approximately $0.10.
| Low | High | ||
| Net revenues | $10.70 billion | $10.85 billion | |
| Net revenues increase | 8.4% | 9.9% | |
| Reported diluted EPS | $8.34 | $8.59 | |
| Adjusted diluted EPS | $9.55 | $9.80 | |
| Cash provided by operations | Approximately $1.45 billion | ||
| Capital expenditures | Approximately $500 million |
The additional table attached
below includes reconciliations of non-GAAP adjusted measures to GAAP measures.
Note on Non-GAAP Financial Measures
As used in this press
release the term "reported" refers to measures under accounting principles generally accepted in the United States ("GAAP").
The term "adjusted" refers to non-GAAP operating performance measures that exclude special items such as restructuring and integration
charges, amortization expense, excess tax benefits ("ETB") associated with stock-based compensation, gains and losses associated
with changes in the carrying value of our strategic investments, and other items.
The company has provided a compound annual growth rate projection
beyond 2025 of 7-9% for adjusted diluted EPS, which is a non-GAAP measure. The company is unable
to present a reconciliation of adjusted diluted EPS to reported diluted EPS, the most comparable GAAP measure, due to the inherent uncertainty
and variability in the nature and amount of special items referenced above, and the amount of these items could be significant in any
of the associated periods.
Non-GAAP adjusted measures
are presented because management believes those measures are useful adjuncts to GAAP results. Non-GAAP adjusted measures should not be
considered as an alternative to the corresponding measures determined under GAAP. Management may use these non-GAAP measures to evaluate
our performance period over period and relative to competitors, to analyze the underlying trends in our business, to establish operational
budgets and forecasts and for incentive compensation purposes. We believe that these non-GAAP measures are useful to investors and analysts
to evaluate our performance period over period and relative to competitors, as well as to analyze the underlying trends in our business
and to assess our performance. The additional table attached below includes reconciliations of non-GAAP adjusted measures to GAAP measures.
Participating in Investor Day
Advance registration is required. To register for the event,
please go to: Quest Diagnostics 2025 Investor Day Registration.
A live webcast of the event will be broadcast on the Quest
Diagnostics Investor Relations website.
A copy of the presentation materials discussed at the meeting
and an archived copy of the webcast will be available on the Quest Diagnostics Investor Relations website.
About Quest Diagnostics
Quest Diagnostics works across the healthcare ecosystem to
create a healthier world, one life at a time. We provide diagnostic insights from the results of our laboratory testing to empower people,
physicians and organizations to take action to improve health outcomes. Derived from one of the world's largest databases of de-identifiable
clinical lab results, Quest's diagnostic insights reveal new avenues to identify and treat disease, inspire healthy behaviors and improve
healthcare management. Quest Diagnostics annually serves one in three adult Americans and half the physicians and hospitals in the United
States, and our more than 55,000 employees understand that, in the right hands and with the right context, our diagnostic insights can
inspire actions that transform lives and create a healthier world. www.QuestDiagnostics.com.
Forward Looking Statements
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, the complexity of billing, reimbursement and revenue recognition for clinical
laboratory testing, changes in government regulations, changing relationships with customers, payers, suppliers or strategic partners,
acquisitions 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.
Shawn Bevec (Investors):
ADDITIONAL TABLE FOLLOWS
The outlook for adjusted diluted EPS represents management's
estimates for the full year 2025 before the impact of special items. Further impacts to earnings related to special items may occur throughout
2025. Additionally, the amount of ETB is dependent upon employee stock option exercises and our stock price, which are difficult to predict.
The following table reconciles our 2025 outlook for diluted EPS under GAAP to our outlook for adjusted diluted EPS:
| Low | High | ||
| Diluted EPS | $8.34 | $8.59 | |
| Restructuring and integration charges (a) | 0.11 | 0.11 | |
| Amortization expense (b) | 1.05 | 1.05 | |
| Other charges (c) | 0.13 | 0.13 | |
| ETB | (0.08) | (0.08) | |
| Adjusted diluted EPS | $9.55 | $9.80 |
Represents estimated pre-tax charges of $16 million primarily associated with workforce reductions
and integration costs incurred in connection with further restructuring and integrating our business. Income tax benefits were primarily
calculated using a combined statutory income tax rate of 25.5%.
Represents estimated pre-tax amortization expenses of $160 million. Income tax benefits were primarily
calculated using a combined statutory income tax rate of 25.5%.
Represents estimated pre-tax net losses of $15 million, principally associated with the increase
in the fair value of the contingent consideration accrual associated with previous acquisitions. No income tax benefits are recorded on
the losses associated with the contingent consideration accrual.