WESTBROOK, Maine-based IDEXX Laboratories, Inc. (NASDAQ:IDXX), a $35.9 billion market cap company with impressive profitability metrics including a 60.7% gross margin, announced the adoption of a new nonqualified deferred compensation plan for its management and highly compensated employees.
According to InvestingPro data, the company maintains a "GREAT" financial health score, demonstrating strong operational performance. The plan, approved by the Board of Directors on December 6, 2024, is designed to comply with Section 409A of the Internal Revenue Code.
The IDEXX Deferred Compensation Plan allows eligible participants to defer a portion of their salary, bonuses, and stock units. Specifically, the plan permits deferral of 5% to 50% of annual base salary, 5% to 100% of annual bonuses, and 5% to 100% of restricted stock units or performance-based restricted stock units.
This move aligns with management's shareholder-friendly approach, as InvestingPro data shows management has been actively buying back shares, with the company maintaining a strong 59% return on equity.
Participants' cash deferrals will be fully vested, while stock unit deferrals will adhere to the vesting conditions outlined in the relevant award agreement. Although the plan does not mandate company contributions, it allows for the possibility of employer discretionary contributions, which may vary annually and by participant. The company has indicated no current plans to make such contributions.
The plan's administration falls under the purview of the Compensation and Talent Committee and the Employee Plans Administrative Committee. Eligible individuals will be notified about their enrollment period. The Committee also retains the authority to select investment vehicles for participants' deferred cash compensation accounts, while stock unit deferrals will be in the form of deferred stock units settled in shares of IDEXX's common stock.
Under the Plan, retirement eligibility is set at age 60 with no service requirement, and vesting of any employer discretionary contributions can be accelerated in the event of a change in control at IDEXX, or the participant's death, disability, or retirement eligibility.
Distributions from the plan may occur upon a participant's separation from service, a predetermined date, death, or an unforeseeable emergency. Participants can opt for a lump sum or annual installments, with distributions for stock unit deferrals paid in company stock.
This announcement is based on a press release statement from IDEXX Laboratories, Inc. The full details of the plan will be provided in the company's upcoming Annual Report on Form 10-K for the year ending December 31, 2024. For investors seeking comprehensive analysis of IDEXX's financial position and future prospects, InvestingPro offers an in-depth research report along with 13 additional ProTips that provide valuable insights into the company's valuation and growth potential.
In other recent news, IDEXX Laboratories reported a 6% organic revenue growth in its Q3 2024 Earnings Conference Call, accompanied by an 11% increase in EPS year-over-year, reaching $2.80. Despite experiencing macroeconomic pressures and weather-related challenges, the company noted a significant rise in its Companion Animal Group diagnostics recurring revenues and water business.
However, IDEXX revised its full-year organic revenue growth forecast to a range of 5.3% to 6%, slightly lower than previous estimates. The company also adjusted its CAG diagnostic recurring revenue growth to 5.8%-6.4% and revised its total reported revenue guidance for 2024 to $3.865 billion to $3.890 billion. Despite these adjustments, IDEXX maintains strong gross margins at 61.1% and a free cash flow conversion outlook of 90%-95%.
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