Quest Diagnostics Lifts 2014 View After Solstas Acquisition - Update

(RTTNews) - Quest Diagnostics Inc. (DGX), a provider of diagnostic information services, Monday lifted its guidance for results from continuing operations for full-year 2014, to reflect completion of Solstas transaction.

The company said its updated guidance for the full year reflects unseasonably harsh winter weather conditions during February, which have negatively impacted Quest Diagnostics' performance.

Quest Diagnostics now estimates the impact of weather to first quarter adjusted earnings per share to be about $0.10.

For full year 2014, the company now expects adjusted earnings, excluding special items, to be in the range of $3.95 to $4.15 per share, up from the prior outlook of $3.90 to $4.10 per share.

Revenues for the year are expected to grow 2 to 4 percent compared to 2013, while the firm earlier projected revenues to be flat to down 2 percent. Revenues from continuing operations were $7.1 billion for full year 2013, 3.2 percent below the year 2012.

On average, 25 analysts polled by Thomson Reuters expect the company to report earnings of $4.03 per share, on revenues of $7.19 billion for fiscal 2014. Analysts' estimates typically exclude special items.

Quest Diagnostics also said it has completed the previously announced acquisition of Greensboro, North Carolina-based commercial laboratory company Solstas Lab Partners Group and its subsidiaries.

According to the firm, the combination will give patients and healthcare providers in the Southeastern United States greater access to innovative and cost-effective diagnostic information services.

In January end, Quest Diagnostics agreed to acquire Solstas Lab Partners Group and its units for around $570 million. Solstas is a portfolio company of Welsh, Carson, Anderson and Stowe, a private-equity firm specializing in information/business services and healthcare businesses.

At that time, the firm had said the transaction is likely to add nearly 5 percent in annualized revenues, and be modestly accretive to adjusted earnings per share in 2014. DGX closed Friday's regular trading at $52.58 on the NYSE.