IDEXX can identify what's wrong with Fluffy, Fido, Flossie, or Flicka. A leading animal health care company, IDEXX makes diagnostic testing kits and machines for pets and livestock. Veterinarians use the company's VetTest analyzers for blood and urine chemistry and its SNAP in-office test kits to detect heartworms, feline leukemia, and other diseases. The company also provides lab testing services and practice management software. In addition, IDEXX makes diagnostic products to detect livestock and poultry diseases and to test for contaminants in water and milk. The company sells its products worldwide.
IDEXX distributes its products through its own marketing and sales force and through independent distributors and resellers. Two-thirds of the company's sales are made in the US, but it also maintains sales offices in 15 countries in Asia, Europe, and the Pacific. While many of its products and materials are manufactured by third parties, it also maintains manufacturing and assembly facilities in Maine and Montpellier, France.
Products and services for companion animals (aka: pets) account for more than 80% of IDEXX's sales, and most of that revenue comes from diagnostic products and services, including chemistry analyzers, rapid test kits, and laboratory services. The company operates a network of laboratories, to which vets can send patient samples for analysis.
Revenues from IDEXX's chemistry analyzer (VetTest, Catalyst Dx, ProCyte Dx) come from both the actual instruments and the consumables used with the systems.The analyzers are big ticket items, but in 2011 consumables accounted for more than 70% of that segment's revenues. Johnson & Johnson subsidiary Ortho-Clinical Diagnostics supplies many of the proprietary consumables.
After companion animals, production animals (such as cows, pigs, and chickens) are the company's second-largest market. IDEXX's Livestock and Poultry Diagnostics business includes products to test for Bovine Spongiform Encephalopathy (BSE or "mad cow" disease) as well as porcine illnesses and poultry diseases. Equine products make up a smaller portion of the company's sales.
IDEXX's water testing segment produces tests to detect E. coli, enterococci, and Cryptosporidia. Water utilities and government laboratories are the primary customers for these products -- half of sales are outside of the US. The company's dairy testing unit produces a SNAP test to measure antibiotic residues in milk, which are highly regulated in markets outside of the US. The company also sells OPTI Medical Systems which measure human electrolyte, blood gases, and glucose levels. The systems and consumables are sold to hospitals and clinics.
Although IDEXX's revenue growth has been slowed in the past couple of years by the economic recession, the company reported a 10% jump in 2011 to $1.2 billion. It also saw net income increase, by about 15%, to $162 million. While the company's success is due to steady growth across all segments, in 2011 the Livestock and Poultry Diagnostics business grew more than 15% as a result of a jump in sales of bovine tests to government agencies in Germany. However, in 2012 that same segment began to soften when testing for BSE on cattle in the EU shifted from age 48 months to age 72 months.
The company has grown organically through the steady introduction of new products, and a few acquisitions. Its 2011 purchase of a research and diagnostic laboratory in Missouri helped to expand its testing services to bioresearch customers. – less