Quest Diagnostics Incorporated · NYSE:DGX
Quest Diagnostics — Jefferies 2013 Global Healthcare Conference
16 slides from Quest Diagnostics's conference presentation, Jun 6, 2013
Slide 1: Jefferies 2013 Global Healthcare Conference
JEFFERIES 2013 GLOBAL HEALTHCARE CONFERENCE JUNE 6, 2013 Quest Diagnostics
Slide 2: Safe Harbor Disclosure
Safe Harbor Disclosure 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
Slide 3: U.S. Diagnostic Testing Represents a Small Cost but Drives Disproportionate Impact
Professional Services (29%) Other (16%) Prescriptions (12%) Hospital (36%) Source: CMS, Thomson Reuters, Quest Diagnostics analysis * Excludes healthcare expenditures related to administration (government and private), government funded public health activities, government-funded research, and inves
Slide 4: U.S. Diagnostic Testing Market is Large and Growing
U.S. Diagnostic Testing Market is Large and Growing Hospital Outreach $14B (20%) Independent Labs $24B (34%) Other $3B (4%) POLs $3B (3%) 3 4 5 6 Ambulatory Physician Services Addressable Market $44B (61%) Hospital Services Addressable Market $28B (39%) Inpatient $20B (28%) Outpatient $8B (11%) 1 2
Slide 5: We Operate in a Highly Fragmented Market
We Operate in a Highly Fragmented Market Total U.S. Lab Market Total = $24B Total = $44B “Outside the Hospital” Lab Segment Independent Lab Segment Total = $72B Outside the Hospital 52% Hospital- Inpatient 28% Hospital- Outpatient 11% Independent Labs 42% Hospital Outreach 33% POL 6% Other 6% DGX 9%
Slide 6: One Vision, Three Goals, Five-Point Strategy
One Vision, Three Goals, Five-Point Strategy 6
Slide 7: Our Five-Point Strategy
Our 5 Point Strategy Refocus: Refocus on diagnostic information services 1 2 3 4 5 Drive: Drive operational excellence Restore: Restore Growth Simplify: Simplify the organization to enable growth and productivity Deliver: Deliver disciplined capital deployment and strategically aligned accretive acq
Slide 8: Thorough Portfolio Review to Evaluate All Assets
1 We Conducted a Thorough Portfolio Review to Evaluate all Assets to Ensure Strong Strategic Fit Retain and Improve Performance • Pathology services, including AmeriPath ‒ Core to our future ‒ Focus on improving performance • Celera ‒ Complete integration of Berkeley HeartLab ‒ Leverage content from
Slide 9: Drive Operational Excellence
• Focus on four strategic imperatives ‒ End-to-end customer value chain ‒ Enterprise IT architecture ‒ Business performance tools ‒ Cost excellence – Invigorate • Invigorate goal ‒ Deliver $500M in savings in 2014 compared to 2011 baseline ‒ Increase goal to $600M run-rate savings exiting 2014 ‒ Exp
Slide 10: Invigorate Flagship Programs Drive Savings Across the Customer Value Chain
Invigorate consists of 6 flagship programs to drive savings and improve performance across the customer value chain 6 Flagship Programs Opportunity Realized/Run Rate ($millions) Organization Excellence Simplify organization structure and reduce management layers $65/$80 IT Excellence Standardize and
Slide 11: Restore Growth
w Restore Growth Sales and Marketing Excellence Esoteric through our Disease 2 Extend in Adjacent Markets Hospitals Lead in and IDNs Companion Diagnostics Create Value from >" Information Assets - TERM ons : Focus
Slide 12: Simplify the Organization
Value Delivery Value Creation Diagnostic Information Services Science & Innovation Sales & Marketing Operations Support Functions NEW General Management Strategic Marketing BEFORE Business 1 Business 2 Business 3 Business 4 Business 5 4 Simplify the Organization 12
Slide 13: Deliver Disciplined Capital Deployment and Strategically Aligned Accretive Acquisitions
• Restore growth ‒ Sales and marketing excellence ‒ Esoteric testing with disease state focus ‒ Strategic hospital / integrated deliver network partnerships • Drive operational excellence ‒ Expand margins through Invigorate ‒ Realize significant operating leverage upon restoration of growth • Increa
Slide 14: Full-Year Guidance
Full-Year Guidance Reaffirming guidance for results from continuing operations, before special items, for full-year 2013, which is unchanged: • Revenues are expected to approximate the prior-year level; • Earnings per diluted share are expected to be between $4.35 and $4.55 • Cash provided by operat
Slide 15: 2013 is a Building Year with Expected Second Half Improvement
2013 is a Building Year and We Expect Performance Improvement Versus Prior Year in the Second Half • Drive Operational Excellence • Invigorate savings in 2H approximately twice the level of 1H • Restore Growth • Benefit from restore growth initiatives to build momentum • Easier comps in 2H • Reimbur
Slide 16: Quest Diagnostics
Quest Ra Diagnostics
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