Highlights
- Quarter 4 gross business wins of $718
million, a gross book to bill of 1.58. Net business wins of $599
million, a net book to bill of 1.32. Full year gross business wins
of $2.6 billion, a gross book to bill of 1.50, net business wins of
$2.3 billion, a net book to bill of 1.29.
- Backlog of business grew 16.9% year on
year to $4.93 billion.
- Quarter 4 net revenue increased 4.6%
year on year to $455 million. Full year net revenue increased 5.5%
to $1,758 million.
- Quarter 4 top customer revenue
concentration reduced to 13.2% from 23.8% in quarter 4 2016. In the
quarter revenue outside our top customer, increased by 19.2% year
over year.
- Quarter 4 income from operations
increased 6.0% year on year to $89.7 million, or 19.7% of revenue.
Full year 2017 income from operations increased by 8.2% to $346.1
million.
- Earnings per share for quarter 4 of
$1.43, a 7.5% increase year on year. 2017 earnings per share on a
pro forma full year basis were $5.39, an increase of 13.0% on
2016.
- Full year 2018 guidance updated to take
account of ASC 606. Revenue to be in the range of $2,520 -$2,640
million. Earnings per share guidance unchanged in the range of
$5.89 - $6.09 representing an increase of 9.3% – 13.0%.
ICON plc (NASDAQ: ICLR), a global provider
of drug development solutions and services to the pharmaceutical,
biotechnology and medical device industries, today reported its
financial results for the fourth quarter and full year ended
December 31, 2017.
CEO Dr. Steve Cutler commented, “2017 was another strong year
for ICON. Positive business win trends across all customer segments
have diversified our business, resulting in backlog growth of 17%
year on year and reducing our top customer concentration to 13% in
quarter 4 from 24% in the same quarter last year. Full year
revenues grew 5.5% to $1.758 billion, and our proactive cost
management has enabled us to expand our operating margin to
19.7%. As a result we have grown EPS 13% year on year to
$5.39. We expect 2018 to be another robust year of revenue and
earnings growth and in accordance with the new accounting standard
we are updating our revenue guidance to a range of $2,520 - $2,640
million. Earnings per share guidance remains in the range of $5.89
- $6.09 representing an increase of 9.3% – 13.0%.”
Fourth Quarter 2017 Results
The positive business environment was reflected in the gross
business wins in the fourth quarter of $718 million and
cancellations in the quarter were $119 million, resulting in net
business wins of $599 million and a net book to bill of 1.32.
In the fourth quarter net revenue grew 4.6% year on year to $455
million from $435 million in the same quarter last year. This
represented 2.3% constant currency growth with revenue outside of
our top customer growing 19.2% year over year. Concentration levels
of ICON’s largest customer significantly reduced from 23.8% of
revenue last year to 13.2% this quarter. This customer now
represents 11% of ICON’s backlog down from 15% last year.
An efficient operational model drove income from operations in
the quarter up by 6.0% to $89.7 million, or 19.7% of revenue,
compared to $84.6 million or 19.5% for the same quarter last
year.
Net income in the quarter increased by 5.7% to
$78.5 million on a non-GAAP basis compared with $74.3 million in
the same quarter last year. This was helped by our industry leading
underlying effective tax rate of 12% and global business support
model that brought SG&A costs down to 18.0% of revenue.
Earnings per share increased to $1.43 per share
on a diluted non-GAAP basis, from $1.33 per share for the same
quarter last year, an increase of 7.5% reflecting a strong quarter
for ICON.
We continued our share repurchase program in
the quarter buying $25 million worth of stock at an average price
of $113.08 per share.
The Company recorded a non-recurring tax expense of $7.4
million during the quarter, principally as a result of the
mandatory repatriation provisions contained in the Tax Cuts and
Jobs Act enacted during the fourth quarter of 2017. Excluding the
non-recurring tax expense the pro-forma tax rate was 10% for the
fourth quarter and 12% for the full year.
Full Year 2017 Results
Full year gross business wins were $2.6 billion and
cancellations were $0.3 billion, resulting in net business wins of
$2.3 billion and a net book to bill of 1.29. This led to strong
backlog growth of 16.9% year on year.
Full year revenue increased by 5.5% to $1,758 million from
$1,666 million in 2016.
Income from operations for 2017, on a non-GAAP
basis, increased by 8.2% to $346 million or 19.7% of revenue
compared with $320 million or 19.2% of revenue in the previous
year.
Net income for 2017, on a non-GAAP basis,
increased by 9.8% to $296 million compared with $269 million last
year.
Earnings per share for 2017, on a non-GAAP basis, increased to
$5.39 per diluted share from $4.77 per diluted share last year, an
increase of 13.0%.
Day’s sales outstanding, comprising accounts receivable and
unbilled revenue less payments on account, were 49 days at December
31, 2017, compared with 50 days at the end of September 2017 and 50
days at the end of December 2016.
Cash generated from operating activities for the quarter was
$105.9 million. Capital expenditure for the quarter was $21
million. As a result, at December 31, 2017, the company had net
cash of $11.6 million, compared to net debt of $56 million at
September 30, 2017 and net debt of $88 million at the end of
December 2016.
During the year we repurchased $133 million shares in total at
an average price of $83.76.
In July, ICON acquired the Mapi Group, a leading health outcomes
research and commercialisation company. Integration plans are
underway and progressing well. This combined division has in excess
of 1,400 heads, operating throughout ICON’s global network and
enhances ICON’s key late stage service offerings. The additional
scale and capabilities means that ICON is the world’s second
largest provider of late phase services.
As of January 1, 2018 ICON has adopted the new revenue
recognition standard (ASC 606). As a result we are updating our
full year 2018 revenue guidance to $2,520 -$2,640 million. Earnings
per share guidance remains unchanged in the range of $5.89 - $6.09
representing an increase of 9.3% – 13.0%.
In addition to the financial measures prepared in accordance
with generally accepted accounting principles (GAAP), this press
release contains certain non-GAAP financial measures, including
non-GAAP operating and net income and non-GAAP diluted earnings per
share. While non-GAAP financial measures are not superior to or a
substitute for the comparable GAAP measures, ICON believes certain
non-GAAP information is useful to investors for historical
comparison purposes.
ICON will hold its fourth quarter conference call today,
February 15, 2018 at 09:00 EDT [14:00 Ireland & UK]. This call
and linked slide presentation can be accessed live from our website
at http://investor.iconplc.com. A recording will also be available
on the website for 90 days following the call. In addition, a
calendar of company events, including upcoming conference
presentations, is available on our website, under “Investors”. This
calendar will be updated regularly.
This press release contains forward-looking statements. These
statements are based on management's current expectations and
information currently available, including current economic and
industry conditions. These statements are not guarantees of future
performance or actual results, and actual results, developments and
business decisions may differ from those stated in this press
release. The forward-looking statements are subject to future
events, risks, uncertainties and other factors that could cause
actual results to differ materially from those projected in the
statements, including, but not limited to, the ability to enter
into new contracts, maintain client relationships, manage the
opening of new offices and offering of new services, the
integration of new business mergers and acquisitions, as well as
economic and global market conditions and other risks and
uncertainties detailed from time to time in SEC reports filed by
ICON, all of which are difficult to predict and some of which are
beyond our control. For these reasons, you should not place undue
reliance on these forward-looking statements when making investment
decisions. The word "expected" and variations of such words and
similar expressions are intended to identify forward-looking
statements. Forward-looking statements are only as of the date they
are made and we do not undertake any obligation to update publicly
any forward-looking statement, either as a result of new
information, future events or otherwise. More information about the
risks and uncertainties relating to these forward-looking
statements may be found in SEC reports filed by ICON, including its
Form 20-F, F-1, S-8 and F-3, which are available on the SEC's
website at http://www.sec.gov.
ICON plc is a global provider of drug development solutions and
services to the pharmaceutical, biotechnology and medical device
industries. The company specialises in the strategic development,
management and analysis of programs that support clinical
development - from compound selection to Phase I-IV clinical
studies. With headquarters in Dublin, Ireland, ICON currently,
operates from 98 locations in 38 countries and has approximately
13,250 employees. Further information is available at
www.iconplc.com.
ICON plcConsolidated Income
Statements (Unaudited)(Before restructuring and other
items)
Three and Twelve Months ended December
31, 2017 and December 31, 2016(Dollars, in thousands, except
share and per share data)
Three Months Ended Twelve Months Ended
December31,2017
December31,2016
December31,2017
December31,2016
Revenue: Gross revenue 636,305 610,465 2,402,321 2,364,956
Reimbursable expenses (181,166) (175,331)
(643,882) (698,469)
Net revenue 455,139
435,134 1,758,439 1,666,487
Costs and expenses:
Direct costs 267,135 251,502 1,027,310 961,333 Selling, general and
administrative expense 82,086 83,534 323,741 325,726 Depreciation
and amortization 16,174 15,455 61,297
59,575
Total costs and expenses 365,395
350,491 1,412,348 1,346,634
Income from
operations 89,744 84,643 346,091 319,853 Net interest
expense (2,512) (3,037) (10,281)
(11,522)
Income before provision for income taxes
87,232 81,606 335,810 308,331 Provision for income taxes
(8,724) (7,344) (40,137) (39,013)
Net income 78,508 74,262 295,673
269,318 Net income per Ordinary Share: Basic
$1.45 $1.35 $5.46 $4.87 Diluted
$1.43 $1.33 $5.39 $4.77 Weighted
average number of Ordinary Shares outstanding: Basic
54,187,688 54,930,541 54,129,439 55,248,900
Diluted 54,844,232 55,685,863
54,849,046 56,407,136
Consolidated Income Statements
(Unaudited)(US GAAP)
Three and Twelve Months ended December
31, 2017 and December 31, 2016(Dollars, in thousands, except
share and per share data)
Three Months Ended Twelve Months Ended
December31,2017
December31,2016
December31,2017
December31,2016
Revenue: Gross revenue 636,305 610,465 2,402,321 2,364,956
Reimbursable expenses (181,166) (175,331)
(643,882) (698,469)
Net revenue 455,139
435,134 1,758,439 1,666,487
Costs and expenses:
Direct costs 267,135 251,502 1,027,310 961,333 Selling, general and
administrative expense 82,086 83,534 323,741 325,726 Depreciation
and amortization 16,174 15,455 61,297 59,575 Restructuring costs
- - 7,753 8,159
Total costs
and expenses 365,395 350,491 1,420,101
1,354,793
Income from operations 89,744 84,643
338,338 311,694 Net interest expense (2,512)
(3,037) (10,281) (11,522)
Income before
provision for income taxes 87,232 81,606 328,057 300,172
Provision for income taxes
(16,124)
(7,344)
(46,569)
(37,993)
Net income 71,108 74,262 281,488
262,179 Net income per Ordinary Share: Basic
$1.31 $1.35 $5.20 $4.75 Diluted
$1.30 $1.33 $5.13 $4.65 Weighted
average number of Ordinary Shares outstanding: Basic
54,187,688 54,930,541 54,129,439 55,248,900
Diluted 54,844,232 55,685,863
54,849,046 56,407,136
ICON plcSummary Balance Sheet
DataDecember 31, 2017 and December 31, 2016(Dollars,
in thousands)
December
31,2017(Unaudited)
December
31,2016(Audited)
Cash and short-term investments 360,448 260,587 Debt
(348,888) (348,511) Net (debt)/cash 11,560 (87,924) Accounts
receivable 379,501 416,229 Unbilled revenue 268,509 192,687
Payments on account (298,992) (272,757) Total 349,018 336,159
Working Capital 534,960 463,552 Total Assets
2,146,618 1,825,843 Shareholder's Equity 1,191,000 945,174
ICON/ICLR-F
View source
version on businesswire.com: http://www.businesswire.com/news/home/20180215005473/en/
ICON plcInvestor Relations, 1-888-381-7923orBrendan Brennan, +
353 1 291 2000Chief Financial OfficerorJonathan Curtain, +1 215 616
3000Vice President Corporate Finance & Investor
Relationshttp://www.iconplc.com
ICON (NASDAQ:ICLR)
Historical Stock Chart
From Mar 2024 to Apr 2024
ICON (NASDAQ:ICLR)
Historical Stock Chart
From Apr 2023 to Apr 2024