VCA Antech, Inc. Reports Second Quarter 2013 Results

VCA Antech, Inc. (NASDAQ: WOOF), a leading animal healthcare company in the United States and Canada, today reported financial results for the second quarter ended June 30, 2013, as follows: revenue increased 6.1% to a second quarter record of $465.3 million; gross profit increased 13.6% to $114.3 million; operating income increased 23.1% to $75.7 million; net income increased 21.4% to $41.7 million; and diluted earnings per common share increased 17.9% to $0.46. Non-GAAP earnings per diluted share excluding acquisition-related amortization and other special charges (“Adjusted EPS Excluding Amortization”) increased 13.6% to $0.50 for the three months ended June 30, 2013.

For the six months ended June 30, 2013 and 2012, diluted earnings per common share were $0.81 and $0.79, respectively. Adjusted EPS Excluding Amortization for the six months ended June 30, 2013 and 2012 were $0.90 and $0.81.

Bob Antin, Chairman and CEO, stated, “We had an excellent quarter with improvements in revenue growth and margins in both our core Animal Hospital and Laboratory business segments. Looking forward, we remain optimistic with respect to our results for the second half of 2013.

“Animal Hospital revenue in the second quarter of 2013 increased 6.7%, to $365.2 million, driven by acquisitions made in the past 12 months and same-store revenue growth of 1.3%. Our same-store gross profit margin increased to 16.7%, from 14.6%, and our consolidated gross margin increased to 16.5%, compared to 14.4% in the prior-year quarter. Our Animal Hospital operating margin increased to 14.1%, compared to 12.1% in the prior-year quarter. In the current and prior-year quarters, we recorded adjustments of a credit of $1.4 million related to rent expense and $3.1 million for a depreciation adjustment related to acquired capital leases, respectively. Excluding these items, our adjusted same-store gross profit margin increased to 16.3% from 15.5%; adjusted consolidated gross margin increased to 16.1%, compared to 15.3% in the prior-year quarter; and adjusted operating margin increased to 13.7%, compared to 13.0% in the prior-year quarter. During the quarter, we acquired three independent animal hospitals which had historical combined annual revenue of $9.7 million.

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