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ICON Reports Fourth Quarter and Full Year 2015 Results and Issues 2016 Earnings Guidance

February 23, 2016

Highlights

  • Quarter 4 gross business wins of $565 million, a gross book to bill of 1.40. Net business wins of $471 million, a net book to bill of 1.17. Full year net business wins of $1.9 billion, a net book to bill of 1.20.
  • Quarter 4 net revenue increased 8.0% year on year on a constant currency basis to $403 million. Full Year 2015 net revenue increased 10.0% on a constant currency basis to $1,575 million.
  • Quarter 4 income from operations up 24.7% year on year to $75.3 million or 18.7% of revenue. Full year 2015 income from operations up 33% to $281.5 million or 17.9% of revenue.
  • Earnings per share for Quarter 4 of $1.11, up 28% year on year. Earnings per share on a pro forma full year 2015 basis were $3.98, up 39% on 2014.
  • Full year 2016 revenue guidance in the range of $1,670 - $1,730 million, representing growth of 6 - 9.8%. Earnings per share guidance in the range of $4.60 - $4.80 representing an increase of 15.6 - 20.6%.

DUBLIN--(BUSINESS WIRE)-- 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, 2015.

In the fourth quarter net revenue grew 3.4% year on year to $403.3 million from $390.1 million in the same quarter last year. This represented 8.0% constant currency growth and 3.7% constant dollar organic growth year on year.

Income from operations in the quarter, increased by 24.7% to $73.3 million or 18.7% of revenue compared to $60.4 million or 15.5% for the same quarter last year.

Net income in the quarter increased by 17.5% to $63.4 million or $1.11 per share on a diluted basis, compared with $54.0 million or $0.87 per share for the same quarter last year.

Full year revenue increased by 4.8% to $1,575 million from $1,503.3 million in 2015. This represented 10.0% constant currency growth and 5.1% constant dollar organic growth year on year.

Full year income from operations increased by 33.3% to $281.5 million or 17.9% of revenue, compared with $211.1 million or 14.0% of revenue in the previous year.

Full year net income increased by 32.1% to $239.5 million, compared with $181.3 million last year. Full year earnings per share increased by 38.7% to a pro-forma $3.98 per share on a diluted basis compared to $2.87 per diluted share last year.

Full year diluted earnings per share on a US GAAP basis amounted to $3.97 compared to the pro-forma $3.98 as reported above. The difference occurs as a result of the method used to calculate the quarterly EPS versus annual EPS.

Day's sales outstanding, comprising accounts receivable and unbilled revenue less payments on account were 41 days at December 31, 2015, compared with 46 days at the end of September 2015 and 40 days at the end of December 2014.

Cash generated from operating activities for the quarter was $116.1 million and $279.5 million for the full year. Capital expenditure for the quarter was $13.5 million and $49.7 million for the full year. During the quarter ICON spent $171 million on share repurchases which brought the value of total shares repurchased during 2015 to $459 million. In addition, $166 million was spent on acquisitions in 2015. As a result, at December 31, 2015, the company had net debt of $160 million, compared to net debt of $33 million at September 30, 2015 and net cash of $216 million at end of December 2014.

CEO, Ciaran Murray commented "During 2015, our operational excellence and market leading innovation helped our customers enhance the productivity of their development programmes, further enhancing ICON's position as their trusted partner in drug development. As a result we booked $1.9 billion of new business and have grown our backlog by 9% year on year to $3.9 billion. Our revenues have grown by 10% on a constant currency basis to $1.575 billion and we have continued to expand our operating margin. This enabled us to grow EPS by 39% year on year to $3.98. For 2016, we are guiding revenue to be in the range of $1,670 - $1,730 million an increase of 6.0 -9.8%, and earnings to be in the range of $4.60 - $4.80 representing an increase of 15.6 - 20.6%".

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 23, 2016 at 9:00 EST [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 90 locations in 37 countries and has approximately 11,900 employees. Further information is available at www.iconplc.com.

ICON/ICLR-F

 

ICON plc
Consolidated Income Statements (Unaudited)
(Before restructuring and other items)

 

Three and Twelve Months ended December 31, 2015 and December 31, 2014
(Dollars, in thousands, except share and per share data)

 
      Three Months Ended     Twelve Months Ended
       

December
31,

December
31,

December
31,

December
31,

2015

2014

2015

2014

Revenue:
Gross revenue 577,059 528,211 2,161,618 2,030,286
Reimbursable expenses       (173,710)     (138,138)     (586,640)     (526,970)
 
Net revenue 403,349 390,073 1,574,978 1,503,316
 
Costs and expenses:
Direct costs 229,386 229,876 908,979 903,167
Selling, general and administrative expense 83,476 85,425 326,786 336,461
Depreciation and amortization       15,142     14,335     57,677     52,542
 
Total costs and expenses       328,004     329,636     1,293,442     1,292,170
 
Income from operations 75,345 60,437 281,536 211,146
 
Net interest expense       (2,026)     204     (2,686)     366
 
Income before provision for income taxes 73,319 60,641 278,850 211,512
 
Provision for income taxes       (9,890)     (6,671)     (39,311)     (30,248)
 
Net income       63,429     53,970     239,539     181,264
 
Net income per Ordinary Share:
Basic       $1.14     89c     $4.08     $2.95
 
Pro forma Diluted       $1.11     87c     $3.98     $2.87
 
Weighted average number of Ordinary Shares outstanding:
Basic       55,783,113     60,394,465     58,746,935     61,496,115
 
Pro forma Diluted       56,919,553     61,908,135     60,185,678     63,131,417
 

 

Consolidated Income Statements (Unaudited)
(US GAAP)

 

Three and Twelve Months ended December 31, 2015 and December 31, 2014
(Dollars, in thousands, except share and per share data)

 
      Three Months Ended     Twelve Months Ended
 

December
31,

   

December
31,

December
31,

   

December
31,

2015

2014

2015

2014

Revenue:
Gross revenue 577,059 528,211 2,161,618 2,030,286
Reimbursable expenses       (173,710)     (138,138)     (586,640)     (526,970)
 
Net revenue 403,349 390,073 1,574,978 1,503,316
 
Costs and expenses:
Direct costs 229,386 229,876 908,979 903,167
Selling, general and administrative expense 83,476 85,425 326,786 336,461
Depreciation and amortization 15,142 14,335 57,677 52,542
Restructuring and other items       -     8,796     -     8,796
 
Total costs and expenses       328,004     338,432     1,293,442     1,300,966
 
Income from operations 75,345 51,641 281,536 202,350
 
Net interest expense       (2,026)     204     (2,686)     366
 
Income before provision for income taxes 73,319 51,845 278,850 202,716
 
Provision for income taxes       (9,890)     (6,671)     (39,311)     (30,248)
 
Net income       63,429     45,174     239,539     172,468
 
Net income per Ordinary Share:
Basic       $1.14     74c     $4.08     $2.80
 
Diluted       $1.11     73c     $3.97     $2.73
 
Weighted average number of Ordinary Shares outstanding:
Basic       55,783,113     60,394,465     58,746,935     61,496,115
 
Diluted       56,919,553     61,908,135     60,290,033     63,131,417
 

 

ICON plc
Summary Balance Sheet Data
December 31, 2015 and December 31, 2014
(Dollars, in thousands)

 
        December 31,       December 31,
2015 2014
(Unaudited) (Audited)
 
 
Cash and short-term investments 189,901 216,000
Debt (350,000) -
Net (debt)/cash (160,099) 216,000
 
Accounts receivable 409,165 370,956
Unbilled revenue 173,649 146,163
Payments on account (318,697) (280,097)
Total 264,117 237,022
 
Working Capital 292,633 281,148
 
Total Assets 1,718,903 1,528,850
 
Shareholder's Equity 764,195 950,206
 

ICON plc
Investor Relations, 1-888-381-7923
or
Brendan Brennan, + 353 1 291 2000
CFO
or
Simon Holmes, +353 1 291 2000
EVP IR & Corporate Development
http://www.iconplc.com

Source: ICON plc

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