Download - quest diagnostics Jefferies_Conf_6_24_08
Jefferies Healthcare Conference
June 24, 2008
Patients | Growth | People
2
Safe Harbor Disclaimer
A copy of this presentation is available on our website at www.questdiagnostics.com
•This presentation may contain 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, the competitive environment, changes in government regulations, changing relationships with customers, payers, suppliers and strategic partners and other factors discussed in “Business” in Part I, Item 1, “Risk Factors” and “Cautionary Statement for Purposes of the ‘Safe Harbor’ Provisions of the Private Securities Litigation Reform Act of 1995” in Item I, Part 1A, “Legal Proceedings” in Part I, Item 3, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 and “Quantitative and Qualitative Disclosures About Market Risk” in Part II, Item 7A in the Quest Diagnostics 2007 Annual Report on Form 10-K and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Quantitative and Qualitative Disclosures About Market Risk” in the Company’s 2008 Quarterly Reports on Form 10-Q and other items throughout the Form 10-K and the Company’s 2008 Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
Patients | Growth | People
3
Who is Quest Diagnostics?
•Leader in Providing Healthcare Insights and Solutions
• Comprehensive Diagnostic Testing• Routine ——» Esoteric
• Diagnose• Monitor• Predict• Prevent
–Advanced Information Technology Solutions• Improve Care and Efficiency
–Facilitate Introduction of New Therapeutics• Clinical Trials Testing
–Innovative Diagnostic Products• Enable Care Closer to the Patient
–Risk Assessment Solutions to Life Insurance Industry
Touching Patients ~150 Million Times Each Year
Patients | Growth | People
4
The Leader in Diagnostic Testing
Source: Washington G-2 Reports and company information
$ in millions
• U.S. Diagnostic Testing Market: >$45 B
Patients | Growth | People
5
Consistently Strong Growth
• #11 Fortune 500 Ranking: 10-year Total Shareholder Return
18%Revenue 1999-200710-year CAGR 18%
25%EPS 1999-2007
10-year CAGR 25%
Fortune Ranking based on years 1997-2006
Patients | Growth | People
6
Favorable Industry Trends
• Growing and Aging Population
• Scientific & Medical Innovations
• Personal Interest in Health
• Convergence of Information
Essential Healthcare Service
Influences >70% of Healthcare Decisions
Patients | Growth | People
7
Moving to Higher Growth,Higher Margin Segments
2007 Pro Forma Revenue2000 Revenue
Total Pro Forma Revenue: $7.0 BillionTotal Revenue: $3.4 Billion
Patients | Growth | People
8
Expanding Market Leadership
• Clinical Testing• Gene-based & Esoteric Testing• Employer Services• Anatomic Pathology Testing• Risk Assessment Services • Healthcare Information Technology• Point of Care (Near Patient) Testing• Clinical Trials Testing• International Market
•••• P• -• -• -• P• -
•••••••• P• P
2000 2008
Overall Market Leader/Niche LeadershipP Market Participant
Patients | Growth | People
9
Our Goals
•Undisputed World Leader in Diagnostic Testing,Information and Services
•Profitably Grow > Industry Rate
•Expand Operating Income to 20%
•Expand International Operations to ~10% of Revenues
Patients | Growth | People
10
Strategy to Drive Profitable Growth
Deliver Superior Patient Experience
Continuously Drive Six Sigma Quality
Lead in Medical Innovation/Information
Leverage Unparalleled Assets & Capabilities
Expand Diagnostic Scope
Expand Geographic Reach
Sustainable Competitive Advantage
Patients | Growth | People
11
Leading Medical Innovator
Unmatched Medical & Technical Expertise
Multiple Channels to Access New TechnologyInternal Development – Nichols InstituteJoint Development RelationshipsLicensing/Distribution Relationships
Most Comprehensive Test MenuLeader in Cancer, CVD & Infectious Disease TestingPioneer in Molecular Diagnostics, LC-MS/MS & Micro-array
Leading Experts for Medical Consultation900 MDs & PhDs>30 Academic Associates
Broadest Product and Service Offering
Patients | Growth | People
12
Unparalleled Assets and Capabilities
Patients | Growth | People
13
Reducing Costs by $500 Million
Streamline Lab Operations
Optimize Logistics Routes and PSC Resources
Improve Billing and Call Center Operations
Leverage Purchasing Capabilities
Maintain Service Levels & Stimulate Growth
Leverage Lean Six Sigma to Improve Efficiency
Patients | Growth | People
14
2008 / 2009 Focus
• Drive Top-Line Growth
• Integrate AmeriPath
• Reduce Costs by $500 Million
• Expand International and Products Businesses
Excellence in Execution
Margin Expansion and Earnings Growth
Patients | Growth | People
15
Building on Strength
Industry Leader in a Vital and Growing Industry
A History of Disciplined Growth
Track Record of Successfully Integrating Acquisitions
Strong Cash Generator
Proven Management Team
Uniquely Positioned with Unparalleled Assets & Capabilities
Focused on Execution
Patients | Growth | People
16