Quest says high demand for Covid testing drove record revenues, increases dividend

People volunteer for Covid-19 surveillance testing using the Quest Diagnostics self administered PCR test on on July 12, 2020 in Livingston, Montana.

William Campbell | Getty Images

Quest Diagnostics said Thursday that continued high demand for Covid-19 testing helped drive record revenues and earnings for the company in the fourth quarter and full year 2020.

While the coronavirus pandemic has disrupted the company’s normal operations such as diagnostic testing for other infectious diseases, Quest has steadily ramped up its capacity to conduct testing for the coronavirus throughout the year.

Here’s how Quest performed compared with what Wall Street expected, based on average analysts’ estimates compiled by Refinitiv:

  • Adjusted EPS: $4.48 vs $4.24 expected.
  • Revenue: $3.0 billion vs $2.93 billion expected.

The company reported net revenues of more than $3 billion for the quarter ended Dec. 31. That’s up almost 56% from $1.93 billion reported during the same period in 2019. On an unadjusted basis, the company reported $4.21 per share, up almost 127% from 2019.

“In a year dominated by the pandemic, Quest brought critical COVID-19 testing to our country, and delivered record revenues, earnings and cash from operations for the fourth quarter and full year 2020,” Chairman and CEO of Quest Steve Rusckowski said in a statement.

Rusckowski announced the company will increase its dividend by 10.7% to 62 cents per quarter and will authorize a $1 billion increase in its share repurchase plan.

“Declines in our base business recovered rapidly throughout the summer and fall; however the recovery stalled at the end of November and into December due to the surge in COVID-19 infections across the country,” Rusckowski said. “Continued high demand for COVID-19 testing drove our performance through the second half of the year.”

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