VCA Antech Inc. Reports Operating Results (10-Q)
VCA Antech Inc. operates a network of freestanding full-service animal hospitals and also operates a network of veterinary-exclusive diagnostic laboratories. VCA Antech Inc. has a market cap of $2.25 billion; its shares were traded at around $26.61 with a P/E ratio of 17.1 and P/S ratio of 1.7. VCA Antech Inc. had an annual average earning growth of 8.2% over the past 10 years. GuruFocus rated VCA Antech Inc. the business predictability rank of 2-star. Highlight of Business Operations: Our growth strategy includes the acquisition of independent animal hospitals. We currently anticipate that we will acquire $60.0 million to $70.0 million of annualized Animal Hospital revenue in 2009. In addition, we also evaluate the acquisition of animal hospital chains, laboratories, or related businesses if favorable opportunities are presented. The following table summarizes the changes in the number of facilities operated by our Animal Hospital and Laboratory segments during the six months ended June 30, 2009:
Consolidated revenue increased $10.4 million for the three months ended June 30, 2009 and $18.5 million for the six months ended June 30, 2009. The increase in consolidated revenue was attributable to revenue from acquired animal hospitals and, to a lesser extent, internal growth in our Laboratory segment. Our Laboratory internal revenue growth was 0.6% and 1.1% for the three and six months ended June 30, 2009. The increase was partially offset by declines in our Animal Hospital same-store revenue and Medical Technology revenue. Our Animal Hospital same-store revenue growth was negative 3.3% and negative 3.0% for the three and six months ended June 30, 2009. The decline in our revenue growth rates is due primarily to the aforementioned economic environment. The six month organic revenue results for both the Animal Hospital and Laboratory segments have been adjusted for differences in business days.
Consolidated gross profit increased $646,000 for the three months ended June 30, 2009 and increased $56,000 for the six months ended June 30, 2009. The increase for the three and six months ended June 30, 2009 was primarily due to acquired animal hospitals and Laboratory internal growth as discussed above. The increase was largely offset by a decline in Medical Technology revenue and modest declines in Animal Hospital and Laboratory gross margins.
Animal Hospital revenue increased $10.3 million for the three months ended June 30, 2009 and $22.5 million for the six months ended June 30, 2009 as compared to the same periods in the prior year. The components of the increase are summarized in the following table (in thousands, except percentages and average price per order):
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