What changed in this filing

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Item 1. Financial Statements

2024-08-02 compared with 2024-04-30 · 212 added, 141 removed, 602 unchanged (37% of the section changed)

Financial Statements (unaudited)

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES

LABCORP HOLDINGS INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions)

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Current assets:

29 unchanged sentences

Shareholders’ equity:

Common stock, $0.10 par value, 84.3 and 83.9 shares outstanding at March 31, 2024, and December 31, 2023, respectively

Common stock, $0.10 par value, 83.8 and 83.9 shares outstanding at June 30, 2024, and December 31, 2023, respectively

Additional paid-in capital 12.5 38.4

4 unchanged sentences

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES

LABCORP HOLDINGS INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in millions, except per share data)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Revenues $ 3,220.9 $ 3,033.7 $ 6,397.5 $ 6,071.5

17 unchanged sentences

Net earnings attributable to the noncontrolling interest ( 0.3 ) ( 0.2 ) ( 0.6 ) ( 0.6 )

Net earnings attributable to Laboratory Corporation of America Holdings $ 228.0 $ 212.9

Net earnings attributable to Labcorp Holdings Inc.

$ 205.3 $ 188.9 $ 433.3 $ 401.8

Basic earnings per share:

7 unchanged sentences

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES

LABCORP HOLDINGS INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS

(in millions)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Net earnings $ 205.6 $ 189.1 $ 433.9 $ 402.4

2 unchanged sentences

Other comprehensive earnings (loss) before tax ( 6.5 ) 52.8 ( 133.2 ) 102.1

Provision for income tax related to items of comprehensive earnings 0.6 ( 0.3 )

(Provision) benefit for income tax related to items of comprehensive earnings ( 0.1 ) ( 0.3 ) 0.5 ( 0.6 )

Other comprehensive earnings (loss), net of tax ( 6.6 ) 52.5 ( 132.7 ) 101.5

1 unchanged sentence

Net earnings attributable to the noncontrolling interest ( 0.3 ) ( 0.2 ) ( 0.6 ) ( 0.6 )

Comprehensive earnings attributable to Laboratory Corporation of America Holdings $ 101.9 $ 261.9

Comprehensive earnings attributable to Labcorp Holdings Inc.

$ 198.7 $ 241.4 $ 300.6 $ 503.3

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES

LABCORP HOLDINGS INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN

7 unchanged sentences

BALANCE AT DECEMBER 31, 2022 $ 8.1 $ — $ 10,581.7 $ ( 493.2 ) $ 10,096.6

Net earnings attributable to Laboratory Corporation of America Holdings — — 212.9 — 212.9

Net earnings attributable to Labcorp Holdings Inc.

— — 212.9 — 212.9

Other comprehensive earnings (loss), net of tax — — — 49.0 49.0

4 unchanged sentences

BALANCE AT MARCH 31, 2023 $ 8.1 $ 47.7 $ 10,729.9 $ ( 444.2 ) $ 10,341.5

Net earnings attributable to Labcorp Holdings Inc.

— — 188.9 — 188.9

Other comprehensive earnings (loss), net of tax — — — 52.5 52.5

Fortrea Holdings Inc.

spin-off — — ( 2,018.1 ) 238.0 ( 1,780.1 )

Dividends declared — — ( 64.5 ) — ( 64.5 )

Issuance of common stock under employee stock plans — 26.8 — — 26.8

Net share settlement tax payments from issuance of stock to employees — ( 18.2 ) — — ( 18.2 )

Stock compensation — 38.1 — — 38.1

BALANCE AT JUNE 30, 2023 $ 8.1 $ 94.4 $ 8,836.2 $ ( 153.7 ) $ 8,785.0

BALANCE AT DECEMBER 31, 2023 $ 7.7 $ 38.4 $ 7,888.2 $ ( 59.3 ) $ 7,875.0

Net earnings attributable to Laboratory Corporation of America Holdings — — 228.0 — 228.0

Net earnings attributable to Labcorp Holdings Inc.

— — 228.0 — 228.0

Other comprehensive earnings (loss), net of tax — — — ( 126.1 ) ( 126.1 )

4 unchanged sentences

BALANCE AT MARCH 31, 2024 $ 7.7 $ 82.0 $ 8,055.3 $ ( 185.4 ) $ 7,959.6

Net earnings attributable to Labcorp Holdings Inc.

— — 205.3 — 205.3

Other comprehensive earnings (loss), net of tax — — — ( 6.6 ) ( 6.6 )

Dividends declared — — ( 60.2 ) — ( 60.2 )

Net share settlement tax payments from issuance of stock to employees — ( 23.1 ) — — ( 23.1 )

Stock compensation — 30.8 — — 30.8

Purchase of common stock — ( 77.2 ) ( 22.8 ) — ( 100.0 )

BALANCE AT JUNE 30, 2024 $ 7.7 $ 12.5 $ 8,177.6 $ ( 192.0 ) $ 8,005.8

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES

LABCORP HOLDINGS INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

Three Months Ended March 31,

Six Months Ended June 30,

CASH FLOWS FROM OPERATING ACTIVITIES:

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Decrease in unbilled services 26.8 74.1

Increase in supplies inventory ( 0.6 ) ( 10.0 )

Increase in prepaid expenses and other ( 24.9 ) ( 57.5 )

Decrease (increase) in supplies inventory 27.7 ( 16.1 )

Decrease (increase) in prepaid expenses and other 21.6 ( 30.2 )

Decrease in accounts payable ( 51.7 ) ( 160.3 )

1 unchanged sentence

Decrease in accrued expenses and other ( 166.4 ) ( 272.8 )

Net cash provided by (used for) continuing operating activities ( 29.8 ) 185.7

Net cash used for discontinued operating activities — ( 64.5 )

Net cash provided by (used for) operating activities ( 29.8 ) 121.2

Net cash provided by continuing operating activities 531.3 347.2

Net cash provided by discontinued operating activities — 125.4

Net cash provided by operating activities 531.3 472.6

CASH FLOWS FROM INVESTING ACTIVITIES:

13 unchanged sentences

Dividends paid ( 122.5 ) ( 129.0 )

Purchase of common stock ( 100.0 ) —

Other ( 7.9 ) ( 11.4 )

1 unchanged sentence

Net cash provided by discontinued financing activities — 1,609.1

Net cash used for financing activities ( 11.7 ) ( 60.6 )

Net cash (used for) provided by financing activities ( 221.7 ) 1,484.4

Effect of exchange rate changes on cash and cash equivalents ( 3.2 ) 6.3

Net decrease in cash and cash equivalents ( 437.5 ) ( 36.1 )

Net (decrease) increase in cash and cash equivalents ( 271.7 ) 1,610.0

Cash and cash equivalents at beginning of period 536.8 430.0

2 unchanged sentences

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES

LABCORP HOLDINGS INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1 unchanged sentence

BASIS OF FINANCIAL STATEMENT PRESENTATION

Laboratory Corporation of America® Holdings (Labcorp® or the Company) is a global leader of innovative and comprehensive laboratory services that provides vital information to help doctors, hospitals, pharmaceuitcal companies, researchers, and patients make clear and confident decisions.

Labcorp® Holdings Inc.

(Labcorp® or the Company) is a global leader of innovative and comprehensive laboratory services that provides vital information to help doctors, hospitals, pharmaceutical companies, researchers, and patients make clear and confident decisions.

By leveraging its unparalleled diagnostics and drug development capabilities, the Company provides insights and accelerates innovations to improve health and improve lives.

On April 25, 2024, the Company announced plans to implement a new public holding company structure, with Labcorp Holdings Inc.

as the new holding company.

On May 17, 2024, the Company completed the holding company reorganization (Reorganization) and Labcorp Holdings Inc.

became the successor issuer to Laboratory Corporation of America Holdings (LCAH).

The new holding company has no independent assets or operations and its sole ownership interest is in LCAH.

The Company reports its business in two segments, Diagnostics Laboratories (Dx) and Biopharma Laboratory Services (BLS), formerly Drug Development.

For further financial information about these segments, see Note 12 (Business Segment Information) to the Condensed Consolidated Financial Statements.

During the three months ended March 31, 2024, Dx and BLS contributed approximately 78 % and 22 %, respectively, of revenues to the Company.

During the three months ended March 31, 2023, Dx and BLS contributed approximately 78 % and 22 %, respectively, of revenues to the Company.

During the three months ended June 30, 2024, Dx and BLS contributed approximately 78 % and 22 %, respectively, of revenues to the Company.

During the six months ended June 30, 2024, Dx and BLS contributed approximately 78 % and 22 %, respectively, of revenues to the Company.

The accompanying condensed consolidated financial statements of the Company are unaudited.

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(Fortrea), formerly the Company's Clinical Development and Commercialization Services (CDCS) business, into a separate, publicly-traded company.

All historical operating results of Fortrea are presented as Discontinued Operations, net of tax, in the consolidated statement of operations.

All historical operating results of Fortrea are presented as Discontinued Operations, net of tax, in the Condensed Consolidated Statements of Operations.

The spin-off is expected to be treated as tax-free for the Company and its shareholders for U.S.

federal income tax purposes.

A discontinued operation may include a component or a group of components of the Company's operations.

A disposal of a component or a group of components is reported in discontinued operations if the disposal represents a strategic shift that has or will have a major effect on the Company's operations and financial results when the following occurs:

(1) a component (or group of components) meets the criteria to be classified as held for sale;

(2) the component or group of components is disposed of by sale;

or (3) the component or group of components is disposed of other than by sale (for example, by abandonment or in a distribution to owners in a spin-off).

For any component classified as held for sale or disposed of by sale or other than by sale, qualifying for presentation as a discontinued operation, the Company reports the results of operations of the discontinued operations (including any gain or loss recognized on the disposal or loss recognized on classification as held for sale of a discontinued operation), less applicable income taxes (benefit), as a separate component in the consolidated statement of operations for current and all prior periods presented.

The Company also reports assets and liabilities associated with discontinued operations as separate line items on the consolidated balance sheet for prior periods.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars and shares in millions, except per share data)

The spin-off of Fortrea from Labcorp was achieved through the Company’s pro-rata distribution of 100% of the outstanding shares of Fortrea common stock to holders of record of Labcorp common stock.

1 unchanged sentence

In June 2023, Fortrea, prior to the Separation and while a subsidiary of the Company, issued $ 570.0 of 7.500 % senior secured notes due 2030 (the Fortrea Notes).

The proceeds from the Fortrea Notes were used to fund cash payments of approximately $ 1,600.0 to the Company in connection with the Separation.

The proceeds from the Fortrea Notes were used to fund cash payments of

LABCORP HOLDINGS INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars and shares in millions, except per share data)

approximately $ 1,600.0 to the Company in connection with the Separation.

The Company does not guarantee the Fortrea Notes following the Separation.

8 unchanged sentences

Earnings from discontinued operations, net of tax in the Consolidated Statements of Operations reflect the after-tax results of Fortrea's business and Separation-related fees, and do not include any allocation of general corporate overhead expense or interest expense of the Company.

The following table summarizes the significant line items included in Earnings from Discontinued Operations, Net of Tax in the Consolidated Statements of Operations for the three months ended March 31, 2023:

Three Months Ended March 31, 2023

The following table summarizes the significant line items included in Earnings from Discontinued Operations, Net of Tax in the Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2023:

Three Months Ended June 30, 2023 Six Months Ended June 30, 2023

Revenues $ 766.5 $ 1,506.6

9 unchanged sentences

Provision for income taxes 6.3 6.8

Net earnings attributable to Laboratory Corporation of America Holdings $ 4.9

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES

Net earnings attributable to Labcorp Holdings Inc.

$ 33.9 $ 38.8

The Company's revenues by segment and by payers/customer groups for the three and six months ended June 30, 2024, and 2023, were as follows:

For the Three Months Ended June 30, 2024 For the Three Months Ended June 30, 2023

North America Europe Other Total North America Europe Other Total

Payer/Customer

Clients 24 % — % — % 24 % 24 % — % — % 24 %

Patients 10 % — % — % 10 % 10 % — % — % 10 %

Medicare and Medicaid 8 % — % — % 8 % 8 % — % — % 8 %

Third party 36 % — % — % 36 % 35 % — % — % 35 %

Total Dx revenues by payer 78 % — % — % 78 % 77 % — % — % 77 %

Pharmaceutical, biotechnology, and medical device companies 9 % 9 % 4 % 22 % 10 % 9 % 4 % 23 %

Total revenues 87 % 9 % 4 % 100 % 87 % 9 % 4 % 100 %

LABCORP HOLDINGS INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars and shares in millions, except per share data)

The Company's revenues by segment and by payers/customer groups for the three months ended March 31, 2024, and 2023, were as follows:

For the Three Months Ended March 31, 2024 For the Three Months Ended March 31, 2023

For the Six Months Ended June 30, 2024 For the Six Months Ended June 30, 2023

North America Europe Other Total North America Europe Other Total

8 unchanged sentences

Revenues in the U.S.

were $ 2,654.6 ( 83.6 %) and $ 2,557.4 ( 84.2 %) for the three months ended March 31, 2024, and 2023, respectively.

were $ 2,698.8 ( 83.8 %) and $ 2,537.0 ( 83.6 %) for the three months ended June 30, 2024 and 2023, respectively, and were $ 5,353.4 ( 83.7 %) and $ 5,094.4 ( 83.9 %) for the six months ended June 30, 2024 and 2023, respectively.

Accounts Receivable, Unbilled Services and Unearned Revenue

The following table provides information about accounts receivable, unbilled services, and unearned revenue from contracts with customers:

March 31, 2024 December 31, 2023

The following table provides information about accounts receivable, unbilled services, and unearned revenue from contracts with customers as of June 30, 2024 and December 31, 2023:

June 30, 2024 December 31, 2023

Dx accounts receivable $ 1,331.4 $ 1,135.2

6 unchanged sentences

Unearned revenue $ 388.3 $ 421.7

Revenues recognized during the period that were included in the unearned revenue balance at the beginning of the period were $ 51.0 and $ 52.6 for the three months ended March 31, 2024 and 2023, respectively.

Revenues recognized during the period that were included in the unearned revenue balance at the beginning of the period were $ 26.8 and $ 20.2 for the three months ended June 30, 2024 and 2023, respectively, and $ 77.8 and $ 72.8 for the six months ended June 30, 2024 and 2023, respectively.

Credit Loss Rollforward

The Company estimates future expected losses on accounts receivable, unbilled services and notes receivable over the remaining collection period of the instrument.

The rollforward for the allowance for credit losses for the three months ended March 31, 2024, was as follows:

The rollforward for the allowance for credit losses for the six months ended June 30, 2024, was as follows:

Accounts Receivable Unbilled Services Note and Other Receivables Total

2 unchanged sentences

Less, write offs 2.0 5.7 — 7.7

Balance as of March 31, 2024 $ 34.2 $ 7.4 $ 0.7 $ 42.3

The credit loss expense in the first three months primarily related to the collection risk from several biotech receivable balances in the first quarter.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES

Balance as of June 30, 2024 $ 34.1 $ 1.8 $ 0.7 $ 36.6

The credit loss expense in the first six months primarily related to the collection risk from several biotech receivable balances.

LABCORP HOLDINGS INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1 unchanged sentence

BUSINESS ACQUISITIONS AND DISPOSITIONS

During the three months ended March 31, 2024, the Company acquired several businesses and related assets for cash of approximately $ 259.2 .

During the six months ended June 30, 2024, the Company acquired several businesses and related assets for cash of approximately $ 293.1 .

These acquisitions consisted of the clinical and outreach businesses of Baystate Medical Center ($ 116.6 ), Providence Medical Foundation ($ 54.9 ), and Westpac Labs, Inc.

($ 97.7 ) and an escrow payment of $ 23.9 for selected assets of the Invitae Corporation that is anticipated to close on August 5, 2024.

The preliminary purchase considerations for these acquisitions were allocated under the acquisition method of accounting to the estimated fair market value of the net assets acquired, including approximately $ 159.4 in identifiable intangible assets.

A residual amount of tax deductible goodwill of approximately $ 141.7 was recorded as of March 31, 2024.

A residual amount of tax deductible goodwill of approximately $ 141.7 was recorded as of June 30, 2024.

The amortization period for non-compete agreements and customer list assets acquired from these businesses are 5 and 15 years, respectively.

The purchase price allocations for these acquisitions have not been finalized as of March 31, 2024.

The preliminary valuation of acquired assets and assumed liabilities, include the following:

The valuation of acquired assets and assumed liabilities, include the following:

Baystate Medical Center Providence Medical Foundation Westpac Labs, Inc.

Amounts Acquired During the Three Months Ended March 31, 2024 Measurement Period Adjustments for Prior Year Acquisitions During the Three Months Ended March 31, 2024

Invitae Corporation Amounts Acquired During the Six Months Ended June 30, 2024 Measurement Period Adjustments for Prior Year Acquisitions During the Six Months Ended June 30, 2024

Cash and cash equivalents $ — $ — $ — $ — $ — $ —

11 unchanged sentences

Cash paid for acquisitions $ 116.6 $ 54.9 $ 97.7 $ 23.9 $ 293.1 $ —

During the three months ended March 31, 2023, the Company recorded several measurement period adjustments for 2022 acquisitions, relating to final valuations and deferred tax true-ups.

On March 28, 2024, the Company announced that it entered into an agreement to acquire selected assets of BioReference Health, a wholly owned subsidiary of OPKO Health for $ 237.5 .

The transaction is anticipated to close in the third quarter of 2024, subject to customary closing conditions for a transaction of this type, including applicable regulatory approvals.

Through this transaction Labcorp will acquire laboratory testing businesses focused on clinical diagnostics and reproductive and women's health across the United States, outside of New York and New Jersey.

On April 24, 2024, the Company announced that it has been selected as the winning bidder for select assets of Invitae, a leading medical genetics company.

On May 6, 2024, the United States Bankruptcy Court approved the previously announced bid by Labcorp to acquire the assets of Invitae.

The purchase price for the transaction is $ 239.0 .

The transaction is anticipated to close on August 5, 2024, subject to customary closing conditions for a transaction of this type, including applicable regulatory approvals.

Through this transaction, the Company would acquire assets being auctioned through a voluntary bankruptcy protection process.

During the six months ended June 30, 2023, the Company acquired two businesses and the related assets for cash of approximately $ 136.9 .

These acquisitions consisted of Jefferson Health and Valley Medical Laboratories in British Columbia which expanded the Company's presence in the northeastern U.S.

A residual amount of non-tax deductible goodwill of approximately $ 50.8 was recorded as of June 30, 2023.

The amortization period for non-compete agreements and customer list assets acquired from these businesses are 7 and 15 years, respectively.

LABCORP HOLDINGS INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars and shares in millions, except per share data)

During the six months ended June 30, 2023, the Company recorded several measurement period adjustments for 2022 acquisitions, relating to final valuations and deferred tax true-ups.

The adjustments include the following:

Measurement Period Adjustments During Three Months Ended March 31, 2023

Measurement Period Adjustments During Six Months Ended June 30, 2023

Cash and cash equivalents $ 0.2

Prepaid expenses and other 0.6

Property, plant and equipment ( 1.5 )

Goodwill ( 29.4 )

7 unchanged sentences

Had the Company's total 2024 and 2023 acquisitions been completed as of January 1, the Company's pro forma results would have been as follows:

Three Months Ended March 31, Three Months Ended March 31,

Three Months Ended June 30, Three Months Ended June 30, Six Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Revenues $ 3,220.9 $ 3,100.5 6,412.0 $ 6,206.5

Net earnings from continuing operations attributable to Laboratory Corporation of America Holdings $ 227.5 $ 216.2

During the three months ended March 31, 2024, the Company sold the assets of its Beacon Laboratory Benefit Solutions, Inc.

Net earnings from continuing operations attributable to Labcorp Holdings Inc.

$ 205.3 $ 193.4 432.8 $ 409.5

During the six months ended June 30, 2024, the Company sold the assets of its Beacon Laboratory Benefit Solutions, Inc.

for $ 13.5 and recorded a gain of $ 4.9 .

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars and shares in millions, except per share data)

EARNINGS PER SHARE

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Potentially dilutive common shares result primarily from the Company’s outstanding stock options, restricted stock awards, restricted stock units, and performance share awards.

The following represents a reconciliation of basic earnings per share to diluted earnings per share:

Three Months Ended March 31,

Earnings Shares Per Share Amount Earnings Shares Per Share Amount

LABCORP HOLDINGS INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars and shares in millions, except per share data)

The following represents a reconciliation of basic earnings per share to diluted earnings per share for the three and six months ended June 30:

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Earnings Shares Per Share Amount Earnings Shares Per Share Amount Earnings Shares Per Share Amount Earnings Shares Per Share Amount

Basic earnings per share:

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The following table summarizes the potential common shares not included in the computation of diluted earnings per share because their impact would have been antidilutive:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Employee stock options and awards 0.4 0.5 0.3 0.4

GOODWILL AND INTANGIBLE ASSETS

The changes in the carrying amount of goodwill for the three months ended March 31, 2024, were as follows:

The changes in the carrying amount of goodwill for the six months ended June 30, 2024, were as follows:

Balance as of December 31, 2023 $ 4,813.9 $ 1,328.6 $ 6,142.5

1 unchanged sentence

Foreign currency impact and other adjustments to goodwill ( 10.7 ) ( 53.3 ) ( 64.0 )

Balance as of March 31, 2024 $ 4,946.2 $ 1,272.7 $ 6,218.9

Balance as of June 30, 2024 $ 4,944.9 $ 1,275.3 $ 6,220.2

The Company assesses goodwill and indefinite-lived intangibles for impairment at least annually or whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable.

9 unchanged sentences

A future impairment charge for goodwill or intangible assets could have a material effect on the Company's consolidated financial position and results of operations.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES

LABCORP HOLDINGS INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1 unchanged sentence

T he components of identifiable intangible assets were as follows:

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Gross Carrying Amount Accumulated Amortization Net Gross Carrying Amount Accumulated Amortization Net

2 unchanged sentences

Non-compete agreements 152.4 ( 72.5 ) 79.9 130.3 ( 60.4 ) 69.9

Trade name 16.4 ( 6.9 ) 9.5 16.4 ( 6.1 ) 10.3

Land use right 3.5 ( 2.8 ) 0.7 3.5 ( 2.7 ) 0.8

Canadian licenses 495.1 — 495.1 498.8 — 498.8

1 unchanged sentence

5,149.7 ( 1,817.7 ) 3,332.0 5,058.4 ( 1,716.4 ) 3,342.0

Amortization of intangible assets for the three months ended March 31, 2024, and 2023, was $ 60.1 and $ 53.4 , respectively.

Amortization of intangible assets for the three and six months ended June 30, 2024, and 2023, was $ 62.2 and $ 51.5 and $ 122.3 and $ 104.9 , respectively.

The amortization expense for the net carrying amount of intangible assets is estimated to be $ 125.0 for the remainder of fiscal 2024, $ 237.2 in fiscal 2025, $ 228.2 in fiscal 2026, $ 216.9 in fiscal 2027, $ 209.1 in fiscal 2028, and $ 1,735.8 thereafter.

Short-term borrowings and the current portion of long-term debt at March 31, 2024, and December 31, 2023, consisted of the following:

March 31, 2024 December 31, 2023

Short-term borrowings and the current portion of long-term debt at June 30, 2024, and December 31, 2023, consisted of the following:

June 30, 2024 December 31, 2023

Revolving line of credit $ 20.0 $ —

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Total short-term borrowings and current portion of long-term debt $ 2,019.5 $ 999.8

Long-term debt at March 31, 2024, and December 31, 2023, consisted of the following:

March 31, 2024 December 31, 2023

Long-term debt at June 30, 2024, and December 31, 2023, consisted of the following:

June 30, 2024 December 31, 2023

3.60% senior notes due 2025 — 1,000.0

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The revolving credit facility also provides for the issuance of letters of credit without a reduction of the availability of borrowings under the facility.

There was $ 42.4 outstanding on the Company's current revolving credit facility and $ 90.7 in outstanding letters of credit on the Company's subfacility as of March 31, 2024.

As of March 31, 2024, the effective interest rate on the

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES

There was $ 20.0 outstanding on the Company's current revolving credit facility and $ 90.7 in outstanding letters of credit on the Company's subfacility as of June 30, 2024.

As of June 30, 2024, the effective interest rate on the revolving credit facility was 6.44 %.

The credit facility expires on April 30, 2026.

LABCORP HOLDINGS INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars and shares in millions, except per share data)

revolving credit facility was 6.42 %.

The credit facility expires on April 30, 2026.

Under the revolving credit facility, the Company is subject to negative covenants limiting subsidiary indebtedness and certain other covenants typical for investment grade-rated borrowers, and the Company is required to maintain certain leverage ratios.

The Company was in compliance with all covenants in the revolving credit facility at March 31, 2024, and expects that it will remain in compliance with its existing debt covenants for the next twelve months.

The Company was in compliance with all covenants in the revolving credit facility at June 30, 2024, and expects that it will remain in compliance with its existing debt covenants for the next twelve months.

PREFERRED STOCK AND COMMON SHAREHOLDERS’ EQUITY

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The Company is authorized to issue up to 30.0 shares of preferred stock, par value $ 0.10 per share.

There were no preferred shares outstanding as of March 31, 2024, and December 31, 2023.

The changes in common shares issued are summarized below:

There were no preferred shares outstanding as of June 30, 2024, and December 31, 2023.

The changes in common shares issued during the six months ended June 30, 2024 are summarized below:

Issued and Outstanding

1 unchanged sentence

Shares issued under employee stock plans 0.4

Common shares at March 31, 2024 84.3

Shares repurchased ( 0.5 )

Common shares at June 30, 2024 83.8

Share Repurchase Program

1 unchanged sentence

Remaining amounts are recognized as a reduction in retained earnings.

As of March 31, 2024, the Company had outstanding authorization from the board of directors to purchase up to $ 531.5 of the Company's common stock.

For the three months ended March 31, 2024, the Company paid $ 62.1 in common stock dividends.

On April 11, 2024 , the Company announced a cash dividend of $ 0.72 per share of common stock for the first quarter, or approximately $ 61.4 in the aggregate.

The dividend will be payable on June 12, 2024 , to stockholders of record of all issued and outstanding shares of common stock as of the close of business on May 28, 2024 .

During the six months ended June 30, 2024, the Company purchased 0.5 shares of its common stock at an average price of $ 202.66 for a total cost of $ 100.0 .

As of June 30, 2024, the Company had outstanding authorization from the board of directors to purchase up to $ 430.4 of the Company's common stock.

On July 24, 2024, the Board adopted a new share repurchase plan authorizing up to $ 1,000.0 of the Company's shares in addition to the remaining amount outstanding under the previous plan.

In aggregate, the share repurchase authorization is $ 1,430.4 .

For the six months ended June 30, 2024, the Company paid $ 122.5 in common stock dividends.

On July 25, 2024 , the Company announced a cash dividend of $ 0.72 per share of common stock for the third quarter, or approximately $ 61.2 in the aggregate.

The dividend will be payable on September 13, 2024 , to stockholders of record of all issued and outstanding shares of common stock as of the close of business on August 29, 2024 .

The declaration and payment of any future dividends will be at the discretion of the Company's board of directors.

Accumulated Other Comprehensive Earnings (Loss)

The components of accumulated other comprehensive earnings (loss) were as follows:

The components of accumulated other comprehensive earnings (loss) during the six months ended June 30, 2024 were as follows:

Foreign Currency Translation Adjustments Net Benefit Plan Adjustments Accumulated Other Comprehensive Earnings (Loss)

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Tax effect of adjustments — 0.5 0.5

Balance as of March 31, 2024 $ ( 171.9 ) $ ( 13.5 ) $ ( 185.4 )

Balance as of June 30, 2024 $ ( 179.1 ) $ ( 12.9 ) $ ( 192.0 )

COMMITMENTS AND CONTINGENCIES

The Company is involved from time to time in various claims and legal actions, including arbitrations, class actions, and other litigation (including those described in more detail below), arising in the ordinary course of business.

The Company (and/or its subsidiaries and affiliates) is involved from time to time in various claims and legal actions, including arbitrations, class actions, and other litigation (including those described in more detail below), arising in the ordinary course of business.

Some of these actions involve claims that are substantial in amount.

These matters include, but are not limited to, intellectual property disputes, commercial and contract disputes, professional liability claims, employee-related matters, transaction-related disputes, securities and corporate law matters, and inquiries, including subpoenas and other civil investigative demands, from governmental agencies, Medicare or Medicaid payers and managed care organizations (MCOs) reviewing billing practices or requesting comment on allegations of billing irregularities that are brought to their attention through billing audits or third parties.

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through billing audits or third parties.

The Company receives civil investigative demands or other inquiries from various governmental bodies in the ordinary course of its business.

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The Company works cooperatively to respond to appropriate requests for information.

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The Company also is named from time to time in suits brought under the qui tam provisions of the False Claims Act and comparable state laws.

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The Plaintiff appealed the Circuit Court’s ruling to the Florida Second District Court of Appeal.

On October 16, 2019, the Florida Second District Court of Appeal reversed the Circuit Court’s dismissal, but certified a controlling issue of Florida law to the Florida Supreme Court.

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October 16, 2019, the Florida Second District Court of Appeal reversed the Circuit Court’s dismissal, but certified a controlling issue of Florida law to the Florida Supreme Court.

On February 17, 2020, the Florida Supreme Court accepted jurisdiction of the lawsuit.

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The Company will vigorously defend the lawsuit.

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On December 29, 2021, the Company was served with a putative class action lawsuit, Nathaniel J.

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The complaint generally alleges that the defendants failed to ensure that the Company utilized proper cybersecurity safeguards and failed to implement a sufficient response to data security incidents, including the AMCA Incident.

The complaint asserts derivative claims for breach of fiduciary duty and seeks relief including damages, certain disclosures, and certain changes to the Company’s internal governance practices.

The complaint asserts derivative claims for breach of fiduciary duty and seeks relief including

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damages, certain disclosures, and certain changes to the Company’s internal governance practices.

On June 2, 2020, the Company filed a Motion to Stay the lawsuit due to its overlap with the multi-district litigation referenced above.

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The Company will vigorously defend the lawsuit.

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Certain governmental entities have requested information from the Company related to the AMCA Incident.

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Once the claims administration is completed, the parties will seek final settlement approval from the court.

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On June 14, 2021, a single plaintiff filed a Private Attorney General Act lawsuit, Becker v.

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A settlement of the Bermejo I and Bermejo II lawsuits, if approved by the court, will resolve the Becker lawsuit.

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On November 23, 2021, the Company was served with a single plaintiff Private Attorney General Act lawsuit, Poole v.

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On February 7, 2022, the Company was served with a Subpoena Duces Tecum issued by the DOJ in Camden, New Jersey requiring the production of documents related to non-invasive prenatal screening tests.

The Company is cooperating with the DOJ.

The Company responded to the DOJ.

On June 27, 2022, the Company was served with a Subpoena Duces Tecum issued by the DOJ in Boston, Massachusetts requiring the production of documents related to urine drug testing.

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Laboratory Corporation of America Holdings , was filed in the U.S.

District Court for the Eastern District of Pennsylvania, alleging that the Company’s website includes a computer code created by Google that sent information to Google related to Plaintiffs and their online activities.

District Court for the Eastern District of Pennsylvania, alleging that the Company’s

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website includes a computer code created by Google that sent information to Google related to Plaintiffs and their online activities.

Plaintiffs assert statutory and common law claims against the Company and seek to represent a class of all persons whose health information was allegedly shared with Google from the Company’s website before March 8, 2023.

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The Company will vigorously defend the lawsuit.

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There are various other pending legal proceedings involving the Company including, but not limited to, additional employment-related lawsuits, professional liability lawsuits, and commercial lawsuits.

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FAIR VALUE MEASUREMENTS

The Company’s population of financial assets and liabilities subject to fair value measurements as of March 31, 2024, and December 31, 2023, was as follows:

The Company’s population of financial assets and liabilities subject to fair value measurements as of June 30, 2024, and December 31, 2023, was as follows:

Fair Value Measurements as of

March 31, 2024

June 30, 2024

Balance Sheet Fair Value as of Using Fair Value Hierarchy

Classification March 31, 2024 Level 1 Level 2 Level 3

Classification June 30, 2024 Level 1 Level 2 Level 3

Noncontrolling interest put Noncontrolling interest $ 15.0 $ — $ 15.0 $ —

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Other liabilities 66.1 — — 66.1

Fair Value Measurement of Level 3 Liabilities Contingent Consideration

Balance at December 31, 2023 $ 66.1

Additions 13.7

Balance as of March 31, 2024 $ 79.8

The Company has a noncontrolling interest put related to its Ontario subsidiary that has been classified as mezzanine equity in the Company’s condensed consolidated balance sheets.

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From time to time, to offset the cost of the growth in the participant's investment accounts, the Company purchases life insurance policies, with the Company named as beneficiary of the policies.

Changes in the cash surrender value of the life insurance policies are based upon earnings and changes in the value of the underlying

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investments, which are typically invested in a similar manner to the participant's allocations.

the cash surrender value of the life insurance policies are based upon earnings and changes in the value of the underlying investments, which are typically invested in a similar manner to the participant's allocations.

Changes in the fair value of the DCP obligation are derived using quoted prices in active markets based on the market price per unit multiplied by the number of units.

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The carrying amounts of cash and cash equivalents, accounts receivable, income taxes receivable, and accounts payable are considered to be representative of their respective fair values due to their short-term nature.

The fair market value of the senior notes, based on market pricing, was approximately $ 4,829.2 and $ 4,850.4 as of March 31, 2024, and December 31, 2023, respectively.

The fair market value of the senior notes, based on market pricing, was approximately $ 4,812.3 and $ 4,850.4 as of June 30, 2024, and December 31, 2023, respectively.

The Company's note and debt instruments are classified as Level 2 instruments, as the fair market values of these instruments are determined using other observable inputs.

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During the first quarter of 2024, the Company terminated its 2024 and 2025 USD to Swiss Franc cross currency swaps and entered into two new swaps, each with a notional value of $300.0 and maturity dates of 2031 and 2034, respectively.

These cross currency swaps are included in accrued expenses and other and other long-term liabilities as appropriate with an aggregate fair value of $ 92.0 and $ 109.0 as of March 31, 2024 and December 31, 2023, respectively.

These cross currency swaps are included in Accrued expenses and other and other long-term liabilities as appropriate with an aggregate fair value of $ 103.6 and $ 109.0 as of June 30, 2024 and December 31, 2023, respectively.

Changes in the fair value of the cross-currency swaps are charged or credited through accumulated other comprehensive income in the Consolidated Balance Sheet until the hedged item is recognized in earnings.

The cumulative amount of the fair value hedging adjustments are recognized as currency translation within the Consolidated Statement of Comprehensive Earnings.

The cumulative amount of the fair value hedging adjustments are recognized as currency translation within the Condensed Consolidated Statement of Comprehensive Earnings.

SUPPLEMENTAL CASH FLOW INFORMATION

Three Months Ended March 31,

Six Months Ended June 30,

Cash paid during period for:

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BUSINESS SEGMENT INFORMATION

The following table is a summary of segment information for the three months ended March 31, 2024, and 2023.

The following table is a summary of segment information for the three and six months ended June 30, 2024, and 2023.

The “management approach” has been used to present the following segment information.

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The Company’s chief executive officer has been identified as the CODM.

The prior period has been conformed to the new segment presentation as a result of the spin-off of Fortrea.

Segment asset information is not presented because it is not used by the CODM at the segment level.

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Centralized functions include corporate governance, executive management and related human resources, finance, legal, risk management, and information technology functions.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES

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Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Dx $ 2,524.9 $ 2,340.8 $ 5,004.6 $ 4,723.6

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Amortization of intangibles and other assets ( 62.2 ) ( 51.5 ) ( 122.3 ) ( 104.9 )

Restructuring and other charges ( 5.0 ) ( 7.5 )

Goodwill and other asset impairments — ( 2.8 ) ( 2.5 ) ( 5.0 )

Restructuring and other charges ( 11.6 ) ( 15.8 ) ( 16.6 ) ( 23.3 )

Total operating income $ 294.8 $ 266.3 $ 616.1 $ 596.1

SUBSEQUENT EVENTS

On April 24, 2024, the Company announced that it has been selected as the winning bidder for select assets of Invitae, a leading medical genetics company.

Before the transaction can proceed, the court overseeing the process must issue an approval order following a hearing currently scheduled for May 6, 2024.

The purchase price for the transaction is $ 239.0 .

The transaction is anticipated to close in third quarter of 2024, subject to customary closing conditions for a transaction of this type, including applicable regulatory approvals.

Through this transaction, the Company would acquire assets being auctioned through a voluntary bankruptcy protection process.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements