This website uses cookies to provide you with the best experience. By using this site you agree to our use of cookies. Please read our cookie notice for more information.
Document

FORM 6-K
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Private Issuer
Pursuant to Rule 13a-16 under
the Securities Exchange Act of 1934


For
the month ended June, 2020

ICON plc
(Registrant's name)


333-08704
(Commission file number)


South County Business Park, Leopardstown, Dublin 18, Ireland
(Address of principal executive offices)


Brendan Brennan, CFO
South County Business Park, Leopardstown, Dublin 18, Ireland
Brendan.Brennan@iconplc.com
+353-1-291-2000
(Name, telephone number, email and/or facsimile number and address of Company contact person)


Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F___X___
Form 40-F______
Indicate by check mark whether the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
Yes______
No___X___
Indicate by check mark whether the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
Yes______
No___X___
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule12g3-2(b) under the Securities Exchange Act of 1934.
Yes______
No___X___
If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):82 N/A

















EXHIBIT LIST
ExhibitDescription
99.1
99.2
99.3
















































SIGNATURES

        Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ICON plc
/s/Brendan Brennan 
Date:June 9, 2020Brendan Brennan
Chief Financial Officer



iconplcnoticeagm2020
Notice of Annual General Meeting to be held on 21 July 2020 ICON plc (the “Company” or “ICON”) THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the action to be taken, you should consult with your independent financial adviser who, if you are taking advice in the Republic of Ireland, is authorised or exempted under the European Communities (Markets in Financial Instruments) Regulations 2017 or the Investment Intermediaries Act, 1995. If you have sold or transferred your entire holding of ordinary shares in ICON, please pass this document, together with the attached proxy form, to the purchaser or transferee, or to the stockbroker, bank or other agent through whom the sale was effected, for transmission to the purchaser or transferee as soon as possible.


 
9 June, 2020 To: All ICON Shareholders NOTICE OF ANNUAL GENERAL MEETING Dear Shareholder The Annual General Meeting of ICON plc will be held at 12.00pm (Dublin time) on 21 July 2020 at ICON’s global headquarters in South County Business Park, Leopardstown, Dublin 18, Ireland (the AGM). The purpose of this letter is to outline the background to and summarise the resolutions to be proposed at the AGM. Please refer to the form of proxy for the AGM (which is separately enclosed) and the notes on pages 9 to 11 for details on how to vote your shares and return your form of proxy. Your attention is also drawn to the notice of the AGM on pages 5 to 8 which sets out the matters to be considered at the AGM. Please ensure that you have read the important notice regarding the measures and procedures we have put in place for the AGM in relation to the COVID-19 pandemic which is contained in the notice of the AGM. Re-election of Directors (ordinary resolutions 1.1 to 1.4) In accordance with our Constitution (by-laws), one third of the members of the Board of Directors (the Board) who are subject to retirement by rotation shall retire from office and may stand for re-election at the AGM. In addition, Ms. Julie O’Neill who was appointed since the 2019 Annual General Meeting, will offer herself for re-election. Accordingly, the following directors will stand for re-election: - Ms. Mary Pendergast – non-executive Director; - Professor Hugh Brady – non-executive Director; - Mr. Rónán Murphy – Lead Independent Director and non-executive Director; and - Ms. Julie O’Neill – non-executive Director appointed in July 2019. Ms. Mary Pendergast, Professor Hugh Brady, Mr. Rónán Murphy and Ms. Julie O’Neill are “independent” non-executive Directors (as that term is defined under the published listing requirements of NASDAQ). Each of the Directors standing for re-election demonstrates the necessary commitment to the role and provides valuable skills, knowledge and experience and makes important contributions to the working of the Board. Further information on the experience, qualifications and industry knowledge of the Directors is available from the Annual Report and/or Form 20-F at https://investor.iconplc.com/financials-filings/annual-reports and details of current committee composition is set out on our website at https://investor.iconplc.com/corporate-governance/committee- composition. ICON’s 2019 Accounts (ordinary resolution 2) This resolution is to review the Company's affairs and consider ICON’s 2019 accounts which have been audited by KPMG, ICON’s independent auditors. 2 ICON plc – Notice of Annual General Meeting 2020


 
Remuneration of Auditors (ordinary resolution 3) This resolution authorises the Directors to fix the remuneration of the auditors. Authority to issue shares up to 20% of share capital (ordinary resolution 4) This resolution authorises the Directors to issue shares until the earlier of the next Annual General Meeting of the Company or 20 January 2022 up to an aggregate of 20% of the share capital of the Company without further shareholder approval. This resolution is required under Irish law as the Company is an Irish incorporated company. The 20% cap on this resolution aligns the resolution with the NASDAQ rules which provide that up to 20% of share capital can be issued without shareholder approval. Authority to issue shares up to 5% of share capital without offering to existing shareholders, with an additional 5% for funding capital investment or acquisitions (special resolution 5 and special resolution 6) Resolution 5 authorises the Directors to issue shares for cash, subject to resolution 4, until the earlier of the next Annual General Meeting of the Company or 20 January 2022 up to an aggregate of 5% of the share capital of the Company without having to offer the shares to existing shareholders on a pro rata basis. Resolution 6 authorises the Directors to issue an additional 5% of the share capital for cash, again subject to Resolution 4, on a non pre-emptive basis provided that the proceeds of any such share issuance are to be used only for the purposes of financing (or refinancing, if the authority is to be used within six months after the original transaction) an acquisition or other capital investment. A resolution authorising the issuance of shares for cash without such offer round is a requirement of Irish law and there is no such requirement under the applicable U.S. Securities and Exchange Commission (the SEC) rules and NASDAQ rules. As above, this year the authorities under these resolutions expire on the earlier of the next Annual General Meeting of the Company or 20 January 2022. The caps on resolutions 4, 5 and 6 are different but complementary and they provide our shareholders with significant anti-dilution protection far in excess of similar protections provided to the shareholders of many other NASDAQ-listed companies. Every year since the Company was listed (apart from 2014 as resolutions with 5 year authority were passed in 2013), the Directors have put resolutions to authorise the issuance of shares and to disapply offer round to the shareholders and each such resolution has been passed. Authority to buy back shares up to 10% of share capital (special resolution 7) This resolution authorises the Company to purchase in the market (buy-back) up to 10% of the outstanding share capital of the Company. It is important both for the Company and shareholders that the Company has this flexibility to implement a buy-back (without having to seek further shareholder approval) if the market conditions favour a buy-back. It should also be noted that while the applicable SEC rules and NASDAQ rules do not require shareholder approval prior to a share buy-back, this resolution is required as the Company is an Irish incorporated company and Irish law requires shareholders to pass such a resolution to give Directors the authority to put a buy-back in place. The authority under this resolution expires on the earlier of the next Annual General Meeting and 20 January 2022. Authority to reissue shares held as treasury shares (special resolution 8) This resolution authorises the price range at which the Company can reissue shares that it holds as treasury shares. Any share buy-back activity by the Company will result in ordinary shares either being cancelled or reissued as treasury shares. We may reissue treasury shares that we acquire through our proposed share buy-back activities including in connection with our executive compensation programme, our employee restricted share unit programme and our other compensation programmes. As a result of using this authority in this way, ICON would avoid the need to issue new shares (and the 3 ICON plc – Notice of Annual General Meeting 2020


 
resulting shareholder dilution) when the vesting of equity awards triggers the requirement to issue shares. The authority being sought from shareholders provides that the minimum and maximum prices at which an ordinary share held in treasury may be reissued are 95% and 120%, respectively, of the average closing price per ordinary share of the Company, as reported by NASDAQ, for the thirty (30) trading days immediately preceding the proposed date of reissuance. Any reissuance of treasury shares will be at price levels that the Board considers in the best interests of our shareholders. There is no resolution dealing with executive compensation as ICON, being a foreign private issuer, is not obliged to provide a “say on pay” shareholder resolution on executive compensation. Details of ICON’s executive officers compensation for 2019 are available in the Annual Report and Form 20-F for 2019 which are available at https://investor.iconplc.com/financials-filings/annual-reports. Approval of Resolutions Resolutions 1.1 to 1.4, 2, 3 and 4 are ordinary resolutions which require approval of a simple majority of the votes cast in person or by proxy and resolutions 5 to 8 are special resolutions which require approval of 75% of the votes cast in person or by proxy. Recommendation of Directors Your Board believes that the resolutions to be proposed at the AGM are in the best interests of the Company and its shareholders. Accordingly, your Directors unanimously recommend that you vote in favour of all resolutions as they intend to do in respect of the shares held by them. On 7 June 2020, the Directors held 675,661 ordinary shares representing approximately 1.3% of the issued ordinary share capital of the Company. Yours sincerely, Ciaran Murray Non-Executive Chairman 4 ICON plc – Notice of Annual General Meeting 2020


 
NOTICE OF ANNUAL GENERAL MEETING NOTICE is hereby given that the Annual General Meeting of the Company will be held at ICON plc Headquarters, South County Business Park, Leopardstown, Dublin 18, Ireland on 21 July 2020 at 12.00pm (Dublin time) (the AGM). ORDINARY BUSINESS To consider and, if thought fit, pass the following ordinary resolutions: 1. To re-elect, by separate resolutions, the following individuals who retire as Directors in accordance with the Constitution of the Company and, being eligible, offer themselves for re- election: 1.1 Ms. Mary Pendergast; 1.2 Professor Hugh Brady; 1.3 Mr. Rónán Murphy; and 1.4 Ms. Julie O’Neill 2. To review the Company's affairs and consider the accounts for the year ended 31st December 2019 and the reports of the Directors and auditors thereon. 3. To authorise the Directors to fix the remuneration of the auditors. SPECIAL BUSINESS To consider and, if thought fit, pass the following ordinary resolution: 4. “That the Directors be and are hereby generally and unconditionally authorised, pursuant to Section 1021 of the Companies Act 2014, to exercise all the powers of the Company to allot relevant securities (within the meaning of Section 1021 of the Companies Act 2014) up to an aggregate nominal amount of €631,548.43 representing approximately 20% of the aggregate nominal value of the issued ordinary share capital of the Company as at 7 June 2020 and the authority conferred by this resolution shall expire on the earlier of the date of the next Annual General Meeting of the Company or 20 January 2022, unless previously renewed, varied or revoked; provided that the Company may make an offer or agreement before the expiry of the authority conferred by this resolution, which would or might require any such securities to be allotted after the authority conferred by this resolution has expired and, in that case, the Directors may allot relevant securities in pursuance of any such offer or agreement as if the authority conferred hereby had not expired.” To consider and, if thought fit, pass the following special resolutions: 5. “That, subject to the passing of Resolution 4, the Directors be and are hereby empowered pursuant to Section 1022 and Section 1023(3) of the Companies Act 2014, to allot equity securities (as defined in Section 1023 of the Companies Act 2014) for cash as if the provisions of sub-section (1) of the said Section 1022 did not apply to any such allotment up to an aggregate nominal amount of € 157,887.11 representing approximately 5% of the aggregate nominal value of the issued ordinary share capital of the Company as at 7 June 2020 and the authority conferred by this Resolution shall expire on the earlier of the date of the next Annual General Meeting of the Company or 20 January 2022, unless previously renewed, varied or revoked; provided that the Company may make an offer or agreement before the expiry of the authority conferred by this resolution, which would or might require any such securities to be allotted after the authority conferred by this resolution has expired and, in that case, the Directors may 5 ICON plc – Notice of Annual General Meeting 2020


 
allot relevant securities in pursuance of any such offer or agreement as if the authority conferred hereby had not expired.” 6. “That subject to the passing of Resolution 4, the Directors be and they are hereby authorised in addition to any authority granted under Resolution 5, to allot equity securities (as defined in Section 1023 of the Companies Act 2014) for cash as if the provisions of sub-section (1) of the said Section 1022 did not apply to any such allotment provided that: (i) The proceeds of any such allotment are to be used for the purposes of financing (or refinancing, if the authority is to be used within six months after the original transaction) an acquisition or other capital investment; and (ii) The nominal value of all equity securities allotted pursuant to this authority together with the nominal value of all treasury shares (as defined in Section 106 of the Companies Act 2014) reissued pursuant to Resolution 8 not exceed € 157,887.11 representing approximately 5% of the nominal value of the issued share capital as at 7 June 2020. The authority conferred by this resolution shall expire on the earlier of the date of the next Annual General Meeting of the Company or 20 January 2022, unless previously renewed, varied or revoked; provided that the Company may make an offer or agreement before the expiry of the authority conferred by this resolution, which would or might require any such securities to be allotted after the authority conferred by this resolution has expired and, in that case, the Directors may allot relevant securities in pursuance of any such offer or agreement as if the authority conferred hereby had not expired.” 7. “That the Company and/or any subsidiary (as such expression is defined by Section 7 of the Companies Act 2014) of the Company be and they are hereby generally authorised to make overseas market purchases (as defined by Section 1072(2) of the Companies Act 2014) of shares of any class of the Company on such terms and conditions and in such manner as the Directors or, as the case may be, the Directors of such subsidiary, may from time to time determine in accordance with and subject to the provisions of the Companies Act 2014 and the following restrictions and provisions: (i) The maximum aggregate number of shares authorised to be acquired pursuant to this resolution shall not exceed 10% of the aggregate number of shares issued by the Company at close of business on the date of passing of this resolution; (ii) The minimum price (exclusive of expenses) which may be paid for any such share shall be an amount equal to the nominal value thereof; and (iii) The maximum price (exclusive of expenses) to be paid for any ordinary share shall be an amount equal to 115% of the NASDAQ Official Close Price (the “NOCP”) (as reported by NASDAQ) of the Company’s ordinary shares on the trading day preceding the day on which the relevant shares are purchased by the Company. The authority hereby conferred shall expire on the earlier of the date of the next Annual General Meeting of the Company or 20 January 2022 or (if earlier) unless previously varied, revoked or renewed in accordance with the provisions of Section 1074 of the Companies Act 2014. The Company or any subsidiary may before such expiry make a contract for the purchase of shares which would or might be wholly or partly executed after such expiry and may make a purchase of shares pursuant to any such contract as if the authority hereby conferred had not expired.” 6 ICON plc – Notice of Annual General Meeting 2020


 
8. “That the reissue price range at which any treasury shares held by the Company may be reissued off-market shall be as follows: (i) the maximum price at which such treasury share may be reissued off-market shall be an amount equal to 120% of the “market price”; and (ii) the minimum price at which a treasury share may be reissued off-market shall be the nominal value of the share where such a share is required to satisfy an obligation under an employee share plan operated by the Company or, in all other cases, an amount equal to 95% of the “market price”; and (iii) for the purposes of this resolution, the “market price” shall mean the average closing price per ordinary share of the Company, as reported by NASDAQ, for the thirty (30) trading days immediately preceding the proposed date of reissuance. The authority hereby conferred to reissue treasury shares shall expire eighteen months from the date of the passing of this resolution unless previously varied or renewed in accordance with the provisions of Section 1078 of the Companies Act 2014.” Special Precautions Due to COVID-19 Concerns: In light of public health concerns related to COVID-19, the Company would like to emphasize that we consider the health of our shareholders, employees, attendees and other stakeholders a top priority and in this context we are closely monitoring the evolving COVID-19 situation. Based on the latest available public health guidance, we expect that the AGM will proceed under very constrained circumstances given current restrictions on public gatherings. Shareholders are strongly encouraged to not attend the meeting in person and instead to vote their shares by proxy as the preferred method of fully and safely exercising their rights. Instructions on how to submit your vote by proxy are set out in the “Notes” section. Personal attendance at the AGM may present a health risk to shareholders and others. The Company advises that shareholders who are experiencing any COVID- 19 symptoms or anyone who has been in contact with any person experiencing any COVID-19 symptoms should not attend the AGM in person. The Company may take additional procedures or limitations applicable to meeting attendees, including restrictions on seating arrangements, health screening requirements and other reasonable or required measures in order to enter the building. In the event that a change of venue becomes necessary due to public health recommendations regarding containment of COVID-19, which may include the closure of or restrictions on access to the meeting venue, we will promptly communicate this to shareholders by an announcement in a press release, on the investor relations page of https://investor.iconplc.com/ and a filing with the U.S. Securities and Exchange Commission. We advise shareholders to monitor the page regularly, as circumstances may change on short notice. We recommend that shareholders keep up-to-date with the latest public health guidance regarding travel, self-isolation and health and safety precautions. 7 ICON plc – Notice of Annual General Meeting 2020


 
By the Order of the Board. Diarmaid Cunningham Company Secretary 9 June, 2020 Registered Office: South County Business Park, Leopardstown, Dublin 18 8 ICON plc – Notice of Annual General Meeting 2020


 
NOTES: 1. Information and Documentation Information regarding the Annual General Meeting is available on the Company’s website www.iconplc.com and from www.proxyvote.com. If you require a paper copy of the Form 20-F or Annual Report, please contact Investor Relations at 1-888-381-7923 or IR@iconplc.com. 2. Who is eligible to vote and how? The record date for the Annual General Meeting is 29 May 2020. If your shares are registered in your name, you are a shareholder of record. Shareholders of record who are entered in the Register of Members of the Company on 29 May 2020 shall be entitled to attend, speak, ask questions and vote at the Annual General Meeting, or if relevant, any adjournment thereof. Changes in the Register of Members of the Company after that time will be disregarded in determining the right of any person to attend and/or vote at the Annual General Meeting. For those shareholders whose shares are not held in their name, but rather in an account at a brokerage firm, bank, dealer or other similar organisation, who in turn hold through The Depository Trust Company (“DTC”), then their entitlement to vote is determined as at 29 May 2020. Depending on whether your shares are registered in your name or whether your shares are held in a “street name” the arrangements are as follows: Shareholder of Record: Shares Registered in Your Name The Company encourages shareholders to vote by Internet, by mail or by telephone, rather than attend the AGM in person in light of the public health concerns related to COVID-19. Please refer to “Special Precautions Due to COVID-19 Concerns” in the Notice of Annual General Meeting of Shareholders above for more information. As a shareholder of record, you may vote in person at the Annual General Meeting or vote by proxy. In the case of joint holders, the vote of the senior member who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other shareholder of record and, for this purpose, seniority shall be determined by the order in which the names stand in the Register of Members of the Company in respect of the joint holding. The appointment of a proxy will not preclude a shareholder of record from attending, speaking, asking questions and voting at the Annual General Meeting should the shareholder subsequently wish to do so. A proxy need not be a member of the Company. If you wish to appoint more than one proxy or a person not listed on the form of proxy, please contact Investor Relations at 1-888-381-7923 or IR@iconplc.com. A Form of Proxy is enclosed with this notice of Annual General Meeting for shareholders of record. To be effective, the Form of Proxy duly completed and executed, together with any authority under which it is executed, or a copy thereof certified, must be deposited at the registered office of the Company, so as to be received by 11.59pm ET on 20 July 2020 or if the Annual General Meeting is adjourned, on the day that falls before the day appointed for the adjourned meeting or (in the case of a poll taken otherwise than at or on the same day as the Annual General Meeting or adjourned meeting) the day before the taking of the poll at which it is to be used. Any alteration to the Form of Proxy must be initialled by the person who signs it. Alternatively, provided it is received by 11.59pm ET on 19 July 2020 or if the Annual General Meeting is adjourned, by 11.59pm ET on the day that falls 48 hours before the time appointed for the adjourned meeting or (in the case of a poll taken otherwise than at or on the same day as the Annual General Meeting or adjourned meeting) by 11.59pm ET on the day that falls 48 hours before the taking of the poll at which it is to be used, the appointment of a proxy may be submitted by telephone or electronically, subject to the applicable terms and conditions, using the phone number on the Form of Proxy and following the instructions provided or via the Internet by accessing Broadridge’s website www.proxyvote.com and following the instructions on the website. The information you need to appoint your proxy by telephone or electronically is included at the top of your Form of Proxy. 9 ICON plc – Notice of Annual General Meeting 2020


 
You need only vote in one way (so that, if you vote by Internet or by telephone, you need not return the Form of Proxy). In the case of a corporation, the Form of Proxy must be either executed under seal or signed on its behalf by a duly authorised officer or attorney. Beneficial Owner: Shares Registered in the Name of a Broker, Bank or Other Agent If, as at 29 May 2020, your shares were not held in your name, but rather in an account at a brokerage firm, bank, dealer or other similar organisation, who in turn hold through The Depository Trust Company (“DTC”), then you are the beneficial owner of shares held in “street name” and these proxy materials are being forwarded to you by that organisation, together with instructions as to voting. You will need to carefully follow the instructions from your broker, bank or other agent or contact your broker, bank or other agent if you have any queries. As a beneficial owner, you have the right to direct your broker or other agent on how to vote the shares in your account as per the instructions enclosed by your broker. You are also invited to attend the Annual General Meeting. However, since you are not the shareholder of record, you may not vote your shares in person at the Annual General Meeting unless you contact your broker and obtain a valid proxy card from your broker or other agent. Therefore as a beneficial owner of shares registered in the name of your broker, bank or other agent, who in turn hold the shares through DTC, you should have received a voting instruction card and voting instructions with these proxy materials from that organisation rather than from us. Simply follow the instructions on the voting instruction card provided by your broker, bank or other agent to ensure that your vote is counted. 3. How many votes do you have? The total number of issued ordinary shares on the record date, 29 May 2020, was 52,629,036. On a vote on a show of hands, every shareholder present in person and every proxy has one vote (but no individual shall have more than one vote). On a poll, every shareholder present in person and every proxy shall have one vote for every share carrying rights of which he is the holder or proxy. Ordinary resolutions are required to be passed by a simple majority of shareholders voting in person or by proxy. Special resolutions are required to be passed by a majority of 75 per cent of shareholders voting in person or by proxy. 4. Broker Voting If your shares are held by a broker on your behalf (that is, in “street name”), and you do not instruct the broker as to how to vote these shares, the broker may not exercise discretion to vote for or against any of the proposals. This would be a “broker non-vote” and these shares will not be counted as having been voted on the proposals. Please instruct your bank or broker so your vote can be counted. 5. Can I change my vote after submitting my proxy? Shareholder of Record: Shares Registered in Your Name Yes. You can revoke your proxy at any time before the final vote at the Annual General Meeting. If you are the record holder of your shares, you may revoke your proxy in any one of three ways: You may submit another properly completed proxy with a later date. Your revised proxy must be received before the commencement of the Annual General Meeting at 12.00pm Dublin time on 21 July 2020 or if the Annual General Meeting is adjourned, before the commencement of the adjourned meeting; You may send a written notice that you are revoking your proxy to Erina Fox, Assistant Company Secretary, ICON plc at the registered office of the Company (being South County Business Park, Leopardstown, Dublin 18, Ireland) or by email to IR@iconplc.com. Your notice must be received before the commencement of the Annual General Meeting at 12.00pm Dublin time on 21 July 2020 or if the Annual General Meeting is adjourned, before the commencement of the adjourned meeting; or You may attend the Annual General Meeting and vote in person. 10 ICON plc – Notice of Annual General Meeting 2020


 
Beneficial Owner: Shares Registered in the Name of a Broker, Bank or Other Agent If your shares are held by your broker, bank or other agent, you should follow the instructions provided by them. Please contact your broker, bank or other agent if you have any queries. 6. What does it mean if I receive more than one set of materials? If you receive more than one set of materials, your shares are registered in more than one name or are registered in different accounts. In order to vote all the shares you own, you must sign and return all of the proxy cards or follow the instructions for any alternative voting procedure on each of the proxy cards you receive. 11 ICON plc – Notice of Annual General Meeting 2020


 
iconplcproxycard2020
Exhibit 99.2


 


 
Document

          
EXHIBIT 99.3













ICON plc and Subsidiaries


Consolidated Financial Statements


Year ended 31 December 2019



Registered number 145835







Directors’ Report and Consolidated Financial Statements


ContentsPage
Directors’ and Other Information
Directors’ Report
Statement of Directors’ Responsibilities in respect of the Directors’ report and the financial statements
Independent Auditor’s Report to the members of ICON plc
Consolidated Statement of Profit and Loss
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to Consolidated Financial Statements
Company Statement of Financial Position
Company Statement of Changes in Equity
Company Statement of Cash Flows
Notes to Company Financial Statements
Reconciliation from IFRS to US Accounting Polices
Appendix A: Risk Factors
1




Directors’ and Other Information
DirectorsCiaran Murray (Irish – Non-Executive Chairman)
Dr. Steve Cutler (Australian – Chief Executive Officer)
Rónán Murphy (Irish – Non-Executive)
Prof. Hugh Brady (Irish – Non-Executive)
Dr. John Climax (Irish – Non-Executive)
Joan Garahy (Irish – Non-Executive)
Prof. William Hall (Irish – Non-Executive)
Eugene McCague (Irish – Non-Executive)
Julie O'Neill (Irish – Non-Executive)
Mary Pendergast (American – Non-Executive)
Company secretaryDiarmaid Cunningham
Registered officeSouth County Business Park
Leopardstown
Dublin 18
Auditor 
KPMG
1 Stokes Place
St. Stephen’s Green
Dublin 2
SolicitorsA & L Goodbody
International Financial Services Centre
North Wall Quay
Dublin 1
Cahill Gordon & Reindel LLP
80 Pine Street
New York
NY 10005
USA
RegistrarsComputershare Investor Services (Ireland) Limited
3100 Lake Drive
Citywest Business Campus
Dublin 24
Bankers 
Citibank
Canada Square
Canary Wharf
London E14 5LB
United Kingdom
JP Morgan Chase Bank N.A.
4 New York Plaza
New York
NY 10004
USA
2




Directors’ Report
The Directors present their report and audited Consolidated and Company Financial Statements of ICON plc (“the Company” or “ICON”), a public limited company incorporated in the Republic of Ireland, and its subsidiary undertakings (“the Subsidiaries”, with the Company and the Subsidiaries being together (“the Group”) for the year ended 31 December 2019.

The Company’s ordinary shares are traded on the NASDAQ market. The Company is considered a foreign private issuer in the US and accordingly it is not subject to the same ongoing regulatory requirements as a US registered company with a primary listing on the NASDAQ market.

These Consolidated and Company Financial Statements (together “the financial statements”) for the year ended 31 December 2019 are prepared in accordance with IFRS as adopted by the EU and meet the reporting requirements pursuant to Irish Company Law. In addition to the Consolidated Financial Statements contained in this annual report, we also prepare separate consolidated financial statements on Form 20-F pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ("SEC") and in accordance with accounting principles generally accepted in the United States (U.S. GAAP). The Form 20-F (under U.S. GAAP) is a separate document, a copy of which may be obtained from the Company’s website www.iconplc.com. IFRS differs in certain respects from U.S. GAAP, details of which are set out on pages 139 to 142 of this annual report.

Principal activities, business review and future developments

The Group is a clinical research organisation (“CRO”), providing outsourced development services on a global basis to the pharmaceutical, biotechnology and medical device industries. The Group specialises in the strategic development, management and analysis of programmes that support all stages of the clinical development process from compound selection to Phase I-IV clinical studies. The Group’s mission is to accelerate the development of drugs and devices that save lives and improve the quality of life. Our vision is to be the Global CRO partner of choice in drug development by delivering best in class information, solutions and performance in clinical and outcomes research.

Headquartered in Dublin, Ireland, the Group began operations in 1990 and has expanded the business predominately through internal growth, together with a number of strategic acquisitions to enhance its capabilities and expertise in certain areas of the clinical development process. Its principal executive office is located at: South County Business Park, Leopardstown, Dublin 18, Republic of Ireland. The contact telephone number of this office is +353 1 291 2000.

The Group believes that it is one of a select number of CROs with the expertise and capability to conduct clinical trials in most major therapeutic areas on a global basis and has the operational flexibility to provide development services on a stand alone basis or as part of an integrated “full service” solution. At 31 December 2019, the Group had approximately 14,650 employees, in 97 locations in 40 countries. During the year ended 31 December 2019, the Group derived approximately 31.8%, 58.5% and 9.7% of its revenue in the United States, Europe and Rest of World, respectively.

We have achieved strong growth since our foundation, as a global provider of outsourced development and commercialisation services to pharmaceutical, biotechnology, medical device and government and public health organisations. We focus our innovation on those factors that are critical to our clients - reducing time to market, reducing cost and increasing quality. Our global team has extensive experience in a broad range of therapeutic areas. ICON has been recognised as one of the world's leading Contract Research Organizations (''CROs") through a number of high-profile industry awards.

As our market has evolved, biopharmaceutical companies are tackling productivity challenges, increasing budget constraints and greater demands to demonstrate product value; all of which are placing increased pressure on their revenues and levels of profitability. However these trends have generally been positive for CROs, as increased outsourcing has been adopted by these companies as they seek to create greater efficiencies in their development processes, convert previously fixed costs to variable, and accelerate time to market for new treatments.

One consequence of the drive to accelerate time to market will be increased emphasis on making existing drug development phases more seamless, through the use of techniques such as adaptive trial designs to filter the most promising compounds and test these in parallel in several therapeutic indications or with other drug combinations.

Regulatory and reimbursement pressures will increase the emphasis on late stage (post marketing) research, while increasing requirements to demonstrate the economic value of new treatments. As a result, outcomes and comparative effectiveness research will most likely be required in order to secure on-going product reimbursement. Furthermore, we believe advances in molecular biology and genetics will drive further growth in innovation in the long term which in turn should create further growth opportunities for both biopharma companies and their outsource development partners.


3





Directors’ Report (continued)
We expect that continued outsourcing will be a core strategy of clients in the near term as they respond to the increased pressures on their revenues and profitability. Larger clients were the first to form strategic partnerships with global CROs in an effort to reduce the number of outsource partners with whom they engage and to reduce inefficiencies in their current drug development models. More recently we have seen the increasing adoption of this partner model with mid-tier pharmaceutical and biotechnology firms as they also seek to drive development efficiencies. As outsourcing penetration increases, we believe clients may seek a greater level of integration of service offerings from CROs, although some will continue to purchase services on a stand-alone basis. Creating greater connectivity and “seamlessness” between our services and the sharing of “real-time” clinical, operational and “real world” data with clients will therefore become increasingly important for CROs. ICON will seek to benefit from this increased outsourcing by clients to grow our business by increasing market share with our existing client base and adding new clients within the Phase I-IV outsourced development services market; the aim being to ensure we will be considered for all major Phase I-IV projects.

https://cdn.kscope.io/f52cc5955458219e9e64c57bb3033574-strategicpillarsa011.jpg

Our strategy is focused on the following areas:

Partnerships, Customers and Markets
We continue to focus on expanding and deepening our partnerships with existing customers, while also developing new customer relationships. Strategic client relationships will increasingly manifest themselves in many different forms. Many of these relationships will require innovative forms of collaboration across ICON service areas and departments and will therefore require increased flexibility to offer services on both a standalone functional basis and as part of a fully integrated service solution. To support this objective, we continue to evolve our collaboration and delivery models, invest in technology that will enable closer data integration across our service areas and enhance our project and programme management capabilities.
We continue to enhance our capabilities through both organic service development and targeted acquisitions, to meet the evolving needs of both existing and new clients. During the year, the Group acquired MMD, MeDiNova and Symphony who will enhance ICON’s capabilities across multiple platforms and strengthen our value proposition to clients; particularly in our laboratory and site network services.
ICON has a focused patient, site and data strategy, which is helping us to improve site identification, study placement and patient recruitment and retention. A successful element of our strategy has been our integrated site network made up of PMG, MeDiNova and Symphony and our ability to grow alliances with third party sites and healthcare institutions in the US and Europe. These acquisitions further enhance ICON’s site network in the US and EMEA and strengthen our patient recruitment capabilities to help recruit patients into studies faster.
We continue to target growth in under-penetrated CRO market segments, outsourcing penetration within medical device companies has lagged that of bio-pharma firms but is beginning to accelerate. EU Regulatory reform enacted in 2017 is a further catalyst to growth in this segment as it included stricter requirements to perform clinical evaluations and post sale surveillance.

4





Directors’ Report (continued)
Operational Excellence and Quality

We continue to enhance our operating processes and delivery models to gain competitive advantage.

Our proprietary ICONIK platform, which integrates clinical data across multiple systems allows us to access clinical and real world data to enhance protocol design, profile match patients to trials. It also facilitates collection of real-time data during the trial process enabling better decision making and project execution. The platform uses data and evidence based research to develop solutions that engage investigators and patients more effectively to improve patient recruitment and retention.

ADDPLAN is part of the ICONIK Informatics Hub. The software provides industry leading statistical design, simulation and analysis for adaptive clinical trials, from phase I to IV and helps our customers identify the most promising drug candidates earlier in the development process and in parallel test these across several therapeutic indications and with other drug combinations. ADDPLAN is used by regulatory agencies (FDA, EMA (Europe) and PMDA (Japan), top pharmaceuticals, medical device companies, and academia.

Finding and engaging suitable patients to conduct clinical trials is one of the biggest issues facing the drug development industry today. Less than 1% of the US population participates in clinical trials and the performance of investigative sites that do take part in research is uneven, hard to predict and many trials do not meet the initial recruitment goals. The current market challenge in patient enrolment creates an opportunity for ICON to differentiate its service offering and we are working to reduce patient recruitment times through enhanced site and investigator selection based on key performance metrics and through use of our proprietary Firecrest technology which is used to train and support sites during the development process. Our PMG, MeDiNova and Symphony site network alliances enhanced our ability to enrol patients onto the clinical studies we perform. We have also developed strategic alliances with investigator site groups and health care systems in all major global research markets. In partnership with others we are pioneering patient recruitment solutions that leverage cognitive computing to transform clinical trial matching and allow a data-driven approach to deliver the right patients for trials. One Search is our intuitive, integrated workflow and interrogation tool that enables access to multiple data sources and provides the visualization and tools necessary for optimum site identification based on ICON and industry data of capability, experience and performance. Scoring on enrolment performance, speed of start-up and quality supports better site selection.

Quality project execution underpins all that we do and we have an ongoing focus on developing our people and processes to continue to enhance our service delivery. We are also deploying supporting technologies which we believe will enable faster and deeper insights into the quality of trial data.

We are focused on operational excellence across our support functions and we operate a global business support infrastructure across functions including finance, information technology, facilities, human resources and legal. This enables us to enhance the service levels across these support areas whilst driving down the costs of the service provision.

Talent, Leadership Development and Culture

At the core of our strategy is our people. Within ICON we have highly qualified and experienced teams, the majority of whom have third level educational qualifications. The need to develop and retain this expertise and talent within the organisation is fundamental in enabling us to be the global CRO partner of choice for our customers.  We have invested in creating an innovative learning environment delivered through ICON’s training and development group, who have formed an industry leading collaboration with University College Dublin. This enables ICON to provide customised management and development programmes for global employees. These programmes are focused on leadership development for those people management roles and specific technical training in competencies that are core to our business, such as project and programme management and clinical research associate development. We continue to invest to refine and develop these programmes.

Our learning and development programmes are complemented by advanced people development practices which incorporate rigorous, analytics based screening in the hiring process, global career frameworks, pay for performance aligned to our strategy, and on-going talent review and succession planning.

Our leadership and talent programmes contribute to the enhanced retention of our employees, better project deliverables for our customers and the enhanced financial performance of the business.

Enhance Capabilities & Expertise

To meet the evolving needs of our clients we continue to enhance our capabilities through both organic service development and targeted acquisitions. During 2018 and 2019, we continued to enhance our scientific and therapeutic expertise to support our customers in specific areas including oncology, orphan and rare diseases, CNS, dermatology, infectious disease and womens health.
5





Directors’ Report (continued)
We have continued to invest in building our capabilities in the gathering, analysis and application of real world patient data within both the clinical trial and post-trial observational study environments. Alongside expanding internal capabilities, we continue to develop innovative partnerships with providers of real world data including EHR4CR and Trinetx. During 2018, we signed an agreement with Intel to deploy the Intel® Pharma Analytics Platform for use in clinical trials. The Intel platform is an artificial intelligence solution that enables remote monitoring and continuous capture of clinical data from study subjects using sensors and wearable devices and can apply machine learning techniques to objectively measure symptoms and quantify the impact of new therapies.

We continued to enhance our site and patient recruitment capabilities with the acquisitions of MeDiNova and Symphony during the year along with the 2018 expansion of the PMG Research network through a partnership with the Du Page Medical Group. DuPage is the largest independent, multi-specialty physician group in the Chicagoland area with access to more than 700 physicians in over 50 clinical specialties ranging from primary to specialty care in areas such as cardiology and oncology. Through this agreement PMG assumed the research infrastructure at DuPage providing expanded investigator and patient access and bringing clinical research as a care option to the communities served.

Applied Innovation

Innovation at ICON is focused on the factors that are critical to our clients. We develop integrated technologies to significantly enhance the efficiency and productivity of clients’ drug and device development programmes, providing true transparency across all areas of a study.

ICON is focused on applying innovation that can help our customers improve their development outcomes. We are focusing this innovation in three critical areas; improving clinical trial design and execution; faster and more predictable patient recruitment; and evolving clinical trials to be more patient centric which includes data collection and analysis directly from patient’s digital devices. Our approach to developing solutions to these challenges incorporates partnering with best in class technology providers but is also supported by a suite of differentiated ICON proprietary technologies.

In addition to our ICONIK platform and ADDPLAN software, Firecrest; ICON’s proprietary comprehensive site performance management system, is a web-based solution which enables accurate study information, including protocol information, training manuals and case report forms, to be rolled out quickly and simultaneously to investigative sites. It allows site behavior to be tracked to ensure training is understood, procedures are being followed and that timelines and study parameters are met. It can significantly reduce the number of data queries originated from investigator sites.

Alongside the application of these technology solutions we are also focused on innovation through the redesign and where appropriate the automation of current clinical trial processes.

Principal activities of the Company and Group

The principal activity of ICON plc ("the Company") is to act as a holding Company. The Company also operates branch offices, ICON Italy in Milan, ICON Poland in Warsaw, ICON Latvia in Riga and ICON Lithuania in Vilnius. These branches provide contract research services to the pharmaceutical industry.

6





Directors’ Report (continued)
Acquisition activity
https://cdn.kscope.io/f52cc5955458219e9e64c57bb3033574-historyacquisitions280.jpg

On 24 September 2019, a subsidiary of the Company, ICON Clinical Research LLC, acquired a 100% interest in CRN Holdings, LLC (trading as Symphony Clinical Research ("Symphony")). Founded in 2003 and operating from its headquarters in Illinois, USA and Gdansk, Poland, Symphony is a leading provider of at-home trial services and site support services from study start-up to closeout for Phase I-IV global studies. Symphony will grow ICON's patient recruitment capabilities globally and complements ICON's site network in the USA, PMG Research and the recently acquired site network in EMEA, MeDiNova. The initial consideration to acquire the 100% interest was cash of $35.0 million and contingent consideration of $2.5 million payable in 2020.

On 23 May 2019, a subsidiary of the Company, ICON Clinical Research (U.K.) Limited, acquired a majority shareholding in MeDiNova, a site network with research sites in key markets in Europe and Africa, and has the right to acquire the remaining shares in the company during 2020. The vendors also have a right to sell the remaining shares exclusively to ICON during 2020. The initial consideration to acquire the majority shareholding was cash of $39.3 million and contingent consideration of $14.8 million. The contingent consideration was paid in October 2019. The acquisition further enhances ICON's patient recruitment capabilities in EMEA and complements ICON's existing site network in the USA, PMG Research.

On 25 January 2019, a subsidiary of the Company, ICON Laboratory Services, Inc., acquired 100% of the share capital of MolecularMD Corp. ("MMD"). The consideration was $42.2 million. MMD is a molecular diagnostic speciality laboratory that enables the development and commercialisation of precision medicines in oncology. It is a recognised leader in the analytical development and clinical validation of molecular diagnostic assays. It offers a comprehensive test menu in immuno-oncology development and services also include companion diagnostic development services. The acquisition enhances ICON’s laboratory offering in molecular diagnostic testing and brings to ICON expanded testing platforms, including next generation sequencing, and immunohistochemistry (IHC).

On 27 July 2017, a subsidiary of the Company, ICON Clinicial Research Limited acquired Mapi Development SAS ('Mapi') and its subsidaries ("Mapi Group"). Mapi Group has over 40 years of experience supporting Life-Science companies as the world leading Patient-Centered Research Company in commercialising novel treatments through Real-World Evidence, Strategic Regulatory Services, Pharmacovigilance, Market Access and Language Services. Mapi Group is the premier provider of Health Research and Commercialisation services to Life-Science companies enabling Market Authorisation, Market Access and Market Adoption of novel therapeutics. Cash outflows on acquisition were $145.8 million. The acquisition of Mapi Group strengthens ICON’s existing commercialisation and outcomes research business adding significant commercialisation presence, analytics, real world evidence generation and strategic regulatory services.

7





Directors’ Report (continued)
Future developments

Please see note 31 Subsequent events for details of events in the period from year-end to the approval of the financial statements.

In 2020, the Group looks forward to continuing to expand through organic growth, together with strategic acquisitions to enhance its expertise and capabilities in certain areas of the clinical development process and to continue to deliver on the Company’s mission to accelerate the development of drugs and devices that save lives and improve the quality of life.

Results and dividends

The results for the year are as shown on page 28 of these financial statements. The Directors do not propose the payment of a dividend for the year ended 31 December 2019.

The following table sets forth for the periods indicated certain financial data as a percentage of revenue and the percentage change in these items compared to the prior period, being the key performance indicators used by management. The trends illustrated in the following table may not be indicative of future results.
Year ended 31 December 2019Year ended 31 December 2018
Percentage change
 in period
As a percentage of revenue
Revenue100 %100 %8.1 %
Direct costs (excluding exceptional items)70.3 %70.0 %8.7 %
Other operating expenses (excluding exceptional items)14.2 %15.0 %1.6 %
Operating profit (excluding exceptional items)15.5 %15.0 %11.9 %
Exceptional items (before taxation)0.0 %0.5 %(100.0)%
Operating profit (including exceptional items)15.5 %14.5 %15.6 %

Twelve months ended 31 December 2019 compared to twelve months ended 31 December 2018

Revenue 
Year Ended
31 December
Change
(dollars in thousands)20192018$%
Revenue$2,805,839  $2,595,777  $210,062  8.1 %

Revenue for the year ended 31 December 2019 increased by $210.1 million, or 8.1%, to $2,805.8 million from $2,595.8 million for the year ended 31 December 2018. For the year ended 31 December 2019 we derived approximately 31.8%, 58.5% and 9.7% of our revenue in the United States, Europe and Rest of World, respectively.









8





Directors’ Report (continued)
Direct costs 
Year Ended
31 December
(dollars in thousands)20192018Change
Direct costs (excluding exceptional items)$1,973,621  $1,816,270  $157,351  
% of revenue (excluding exceptional items)70.3 %70.0 %8.7 %
Direct costs (including exceptional items)$1,973,621  $1,826,287  $147,334  
% of revenue (including exceptional items)70.3 %70.4 %8.1 %

Direct costs for the year ended 31 December 2019 increased by $157.4 million, or 8.7%, to $1,973.6 million from $1,816.3 million for the year ended 31 December 2018 (excluding exceptional items). Direct costs consist primarily of investigator and other reimbursable costs, compensation, associated fringe benefits and share based compensation expense for project-related employees and other direct project driven costs. The increase in direct costs during the year relates to increases in third party investigator and other reimbursable costs, an increase in direct project related costs and personnel related expenditure. The increase in other direct costs (excluding exceptional items) during the period arose due to an increase in headcount and a corresponding increase in personnel related expenditure of $55.7 million combined with an increase in other direct project related costs of $1.8 million, increases in laboratory costs of $0.5 million, partly offset by a decrease in travel related costs of $0.4 million. As a percentage of gross revenue, direct costs have increased to 70.3% compared to 70.0% for the year ended 31 December 2018 (excluding exceptional items).

Other Operating Expenses 
Year Ended
31 December
(dollars in thousands)20192018Change
Other operating expenses (excluding exceptional items)$396,087  $389,899  $6,188  
% of revenue (excluding exceptional items)14.2 %15.0 %1.6 %
Other operating expenses (including exceptional items)$396,087  $392,372  $3,715  
% of revenue (including exceptional items)14.2 %15.1 %0.9 %

Other operating expenses for the year ended 31 December 2019 increased by $6.2 million, or 1.6%, to $396.1 million compared to $389.9 million for the year ended 31 December 2018 (excluding exceptional items). Other operating costs are primarily comprised of compensation, related fringe benefits, share compensation expense for non project related employees, recruitment expenses, recruitment expenditure, professional service costs, advertising costs and all costs related to facilities and information systems. As a percentage of revenue, other operating expenses decreased to 14.2% of revenue, compared to 15.0% of revenue for the year ended December 31, 2018 (excluding exceptional items). During the year, general overhead costs net of foreign exchange costs increased by $8.1 million, acquisition costs increased by $3.3 million, marketing fees increased by $1.1 million, personnel related costs increased by $0.4 million, depreciation and amortisation decreased by $4.4 million, facilities related costs decreased by $1.4 million and professional fees decreased by $1.0 million.

Restructuring

There were no new restructuring plans implemented during the year ended 31 December 2019 (31 December 2018: charge of $12.5 million).












9





Directors’ Report (continued)
Operating profit
Year Ended
31 December
(dollars in thousands)20192018Change
Operating profit (excluding exceptional items)$436,131  $389,608  $46,523  
% of revenue (excluding exceptional items)15.5 %15.0 %11.9 %
Operating profit (including exceptional items)$436,131  $377,118  $59,013  
% of revenue (including exceptional items)15.5 %14.5 %15.6 %

Operating profit increased by $46.5 million, or 11.9%, to $436.1 million for the year ended 31 December 2019 from $389.6 million for the year ended 31 December 2018 ($377.1 million including exceptional items). As a percentage of revenue, operating profit increased to 15.5% of revenues for year ended 31 December 2019 compared to 15.0% of revenues for year ended 31 December 2018 (14.5% including exceptional items).

Financing income and expense
Year Ended
31 December
Change
(dollars in thousands)20192018$%
Financing income$6,859  $4,759  $2,100  44.1 %
Financing expense$(24,625) $(13,502) $11,123  82.4 %

Financing expense for the period increased to $24.6 million for the year ended 31 December 2019 from $13.5 million for the year ended 31 December 2018. This is due to the inclusion of the financing costs of $2.6 million on adoption of IFRS 16 Leases and the remeasurement of the gross obligation under put option of $8.7 million. Financing income for the year increased to $6.9 million for the year ended 31 December 2019 from $4.8 million for the year ended 31 December 2018. This is due to the increase in cash and cash equivalents of $520.3 million at 31 December 2019 from $395.9 million at 31 December 2018.

Income tax expense
Year Ended
31 December
Change
(dollars in thousands)20192018$%
Income tax expense (excluding exceptional items)$57,332  $47,011  $10,321  22.0 %
Effective income tax rate (excluding exceptional items)13.7 %12.3 %

Income tax expense for the period increased to $57.3 million for the year ended 31 December 2019 from $47.0 million for the year ended 31 December 2018. The Group’s effective tax rate for the year ended 31 December 2019 was 13.7% compared with 12.4% (12.3% excluding the effect of exceptional items) for the year ended 31 December 2018. The Group’s effective tax rate is principally a function of the distribution of pre-tax profits in the territories in which it operates.

Risks and uncertainties

Under Irish Company Law (Section 327 of the Companies Act 2014 ‘the Companies Act’), the Directors are required to give a description of the principal risks and uncertainties which it faced at 31 December 2019. Details of the principal risks and uncertainties facing the Group are set out in Appendix A of this annual report and form an integral part of the Directors’ Report.






10





Directors’ Report (continued)
Financial risk management

Group financial risk management is governed by policies and guidelines which are reviewed and approved annually by the Board of Directors. These policies and guidelines primarily cover foreign exchange risk, credit risk, liquidity risk and interest rate risk. The principal objective of these policies and guidelines is the minimisation of financial risk at reasonable cost. The Group’s financial instruments comprise cash and cash equivalents, current asset investments, finance lease obligations and negotiated debt facilities. The main purpose of these financial instruments is to fund the working capital requirements of the Group, the cost of new acquisitions and continued growth. The Group also uses derivative financial instruments to reduce exposure to fluctuations in foreign exchange rates. The principal financial risk facing the Group is currency rate risk. Other financial risks include interest rate risk, credit risk and liquidity risk. Further details of which are set out in note 26 to the Consolidated Financial Statements and note 11 to the Company Financial Statements. The Group does not undertake any trading activity in financial instruments nor does it enter into any leveraged derivative transactions. The Group treasury function centrally manages the Group’s funding and liquidity requirements.

Financing

The Group maintains both committed and uncommitted credit lines with its relationship banks. On 15 December 2015, the Company issued through its subsidiary ICON Investments Five Unlimited Company (the "Issuer") Senior Notes for aggregate gross proceeds of $350 million through a private placement. The interest rate on the Senior Notes was fixed at 3.64% and is payable semi-annually. The Senior Notes are guaranteed by ICON plc. The Senior Notes may be redeemed, at the Issuer's option, at any time prior to maturity, at par plus a make whole premium, together with accrued and unpaid interest, if any, to the redemption date. The terms of the notes are set forth in the Note Purchase and Guarantee Agreement, dated as of 15 December 2015, by and among the Issuer, ICON plc and the purchasers named therein (“Note Purchase and Guarantee Agreement”). The Notes have not been, and will not be, registered under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

The Group entered into an interest rate hedge in anticipation of the drawdown of the Senior Notes the proceeds of which were received in November 2015. During the year ended 31 December 2015, cash proceeds of $4.6 million representing the realised gain on the interest rate hedge was received on maturity in November 2015 and recorded within other comprehensive income. The realised gain is amortised to the Consolidated Statement of Profit and Loss over the term of the hedge resulting in an offset to the interest payable expense on the notes. This interest rate hedge qualified for hedge accounting under IAS 39. The effective rate on the 5 year Senior Notes is fixed at 3.37%.

The senior notes are due for repayment in December 2020. We regularly evaluate our debt arrangements, as well as market conditions, and during the year we will explore the opportunity to modify our existing arrangements or pursue additional financing arrangements that may result in the issuance of new debt securities by us or our affiliates.

Subsequent events

Details of subsequent events are set out in note 31 to the Consolidated Financial Statements.




















11





Directors’ Report (continued)
Directors and Secretary

The members of the Board of Directors during the year are included in note 9 to the Consolidated Financial Statements.

The following table sets forth information concerning the composition of the Company’s Board committees as of 31 December 2019:
NamePosition
Ciaran Murray
Non Executive Chairman and Director
Dr. Steve Cutler (1)(5)
Chief Executive Officer and Director
Rónán Murphy (2)(3)(5)
Director
Professor Hugh Brady (3)
Director
Dr. John Climax
Director
Joan Garahy (2)(4)
Director
Professor William Hall (2)(4)
Director
Eugene McCague (3)(4)
Director
Julie O'Neill
Director
Mary Pendergast (2)
Director
(1)Executive Officer of the Company.
(2)Member of Compensation and Organisation Committee.
(3)Member of Audit Committee.
(4)Member of Nominating and Governance Committee.
(5)Member of Execution Committee.

Details required by Companies Act 2014, section 329, of Directors’ interests in the Group’s shares are set out in note 9 to the Consolidated Financial Statements. Mr Declan McKeon and Professor Dermot Kelleher resigned as directors on 23 July 2019. Ms Julie O'Neill was appointed as a director on 23 July 2019. All other Directors served for the entire year.

Directors’ remuneration

Details of the Directors’ remuneration and interests are set out in notes 3 and 9 to the Consolidated Financial Statements.

Directors’ power to purchase and allot company shares

Subject to the provisions of the Companies Act 2014, the Company may purchase any of its own shares. Every contract for the purchase of shares, or under which the Company may become entitled or obliged to purchase shares in the Company shall be authorised by a special resolution of the Company. The Company may cancel any shares so purchased or may hold them as treasury shares or re-issue them.

A resolution was passed at the Company’s Annual General Meeting (“AGM”) on 22 July 2016, which authorised the Directors to purchase (buyback) up to 10% of the outstanding shares in the Company. This authorisation was renewed at the Company's AGM on each of 25 July 2017, 24 July 2018 and 23 July 2019. On 3 October 2016, the Company commenced a share buyback programme of up to $400 million. The share buyback programme was completed during the year ended 31 December 2018 with a total of 4,026,576 ordinary shares redeemed for a total consideration of $372.1 million. On 8 January 2019, the Company commenced a further share buyback programme of up to 1.0 million ordinary shares which was completed during the year ended 31 December 2019. These shares were redeemed by the Company for a total consideration of $141.6 million. On 22 October 2019, the Company commenced a further share buyback programme. At 31 December 2019, 35,100 ordinary shares were redeemed by the Company under this programme for a total consideration of $5.3 million.

All ordinary shares that are redeemed under the buyback programme will be cancelled in accordance with the constitutional documents of the Company and the nominal value of these shares transferred to an undenominated capital fund as required under Irish Company law.




12





Directors’ Report (continued)
Rights and Obligations attaching to the Company’s shares

The authorised share capital of the Company is €6,000,000 divided into 100,000,000 ordinary shares of €0.06 at 31 December 2019. Holders of ordinary shares will be entitled to receive such dividends as may be recommended by the Board of Directors of the Company and approved by the shareholders and/or such interim dividends as the Board of Directors of the Company may decide. On liquidation or a winding up of the Company, all assets available for distribution will be paid out to the holders of the Company's ordinary shares. Holders of ordinary shares have no conversion or redemption rights. On a show of hands, every holder of an ordinary share present in person or proxy at a general meeting of shareholders shall have one vote with no individual having more than one vote.

Change of control

Certain of the Group’s customer contracts allow the customer to terminate the contract in the event of a change in control of the Company.
The Group has negotiated a banking facility with a number of financial institutions, details of which are set out in note 23 to the Consolidated Financial Statements. This facility requires repayment in the event that the Company becomes controlled by any person or persons acting in concert by whom it was not controlled at the date the facility was entered into.

Furthermore certain Group companies have entered capital grant agreements with the Irish government agency, Enterprise Ireland, whereby the Group covenants that the controlling interest in the Company will not change without Enterprise Ireland’s prior written consent, which will not be unreasonably withheld.

Additionally, the Company's share option and restricted share unit plans contain change in control provisions which provide for the acceleration of the vesting and exercisability of outstanding options and awards of restricted share units in the event that a change in control occurs with respect to the Company.

Corporate Governance

The Company is listed on the NASDAQ Global Select Market. The Company complies with the corporate governance listing requirements under the NASDAQ marketplace rules. NASDAQ may provide exemptions from certain NASDAQ corporate governance standards to a foreign private issuer in certain circumstances provided that the foreign private issuer properly notifies NASDAQ and makes the required disclosure except to the extent that such exemptions would be contrary to United States federal securities laws.

The exemptions that the Company relies on, and the practices the Company adheres to, are as follows:

The Company is exempt from provisions set forth in NASDAQ Rule 5620(c), which requires each issuer (other than limited partnerships) to provide for a quorum in its by-laws for any meeting of the holders of common stock, which shall in no case be less than 33.33% of the outstanding shares of the issuer’s common voting stock.  The Company’s Constitution requires that only 3 members be present, in person or by proxy, at a shareholder meeting to constitute a quorum.  This quorum requirement is in accordance with Irish law and generally accepted business practices in Ireland.

The Company is exempt from provisions set forth in NASDAQ Rule 5635(c) which requires (other than for certain specified exceptions) shareholder approval prior to the establishment or material amendment of a stock option or purchase plan or other equity compensation arrangement made or materially amended, pursuant to which stock may be acquired by officers, directors, employees or consultants.  Irish law does not require shareholder approval with respect to equity compensation arrangements. Accordingly, the 2019 Consultants and Directors
Restricted Share Unit Plan, the 2013 Employees Restricted Share Unit Plan and the amendments to the Employee Share Option Plan 2008 and Consultants Share Option Plan 2008 were adopted by the Board of Directors without shareholder approval.

13





Directors’ Report (continued)
The Company is exempt from provisions set forth in NASDAQ Rule 5605(b)(2), which requires independent Directors to hold regularly scheduled meetings at which only independent Directors are present.  Irish law does not require independent directors to hold regularly scheduled meetings at which only independent Directors are present.  The Company holds regularly scheduled meetings which all of the Directors may attend and the Lead Independent Director may call meetings of the independent directors and non-employee directors of the Board, as appropriate, in accordance with the Lead Independent Director Charter. 

The Company's practices with regard to these requirements are not prohibited by Irish law.

Audit Committee

The Audit Committee meets a minimum of four times a year. It reviews the quarterly and annual financial statements, the effectiveness of the system of internal control (including the arrangement for the Company’s employees to raise concerns in confidence about financial inappropriateness) and recommends the appointment and removal of the external auditors. It monitors the adequacy of internal accounting practices and addresses all issues raised and recommendations made by the external auditors. The Audit Committee pre-approves all audit and non-audit services provided to the Company by its external auditors on a quarterly basis. The Audit Committee, on a case by case basis, may approve additional services not covered by the quarterly pre-approval, as the need for such services arises. The Audit Committee reviews all services which are provided by the external auditor to review the independence and objectivity of the external auditor, taking into consideration relevant professional and regulatory requirements. The Chief Financial Officer, the Head of Internal Audit, the General Counsel and the external auditors normally attend all meetings of the Audit Committee and have direct access to the Committee Chairman at all times. At 31 December 2019, the Audit Committee was comprised of three independent Directors: Rónán Murphy (Chairperson), Professor Hugh Brady and Eugene McCague. Declan McKeon stepped down as Chairperson and Rónán Murphy assumed the position of Chairperson with effect from 19 February 2019. Declan McKeon stepped down as member of the Committee on 22 July 2019.

Significant shareholdings

The Company has been notified of the following shareholdings in excess of 3% of the issued share capital of the Company as at 31 December 2019:
Name
%
Number of Shares
Wellington Management Company LLP7.093,800,959
WCM Investment Management6.793,643,211
ClearBridge Investments, LLC4.992,675,763
Renaissance Technologies LLC4.382,347,059
AllianceBernstein LP4.062,177,170
Acadian Asset Management LLC3.932,108,952
EARNEST Partners LLC3.832,053,089
Comgest S.A.3.281,760,847
Wasatch Global Investors Inc.3.021,618,371
Oddo BHF Asset Management S.A.S.3.011,611,710
All Directors and Officers as a group (1)
2.381,278,374

(1)Includes 449,372 ordinary shares issuable upon the exercise of stock options granted by the Company, 46,439 restricted stock units (“RSUs”) awarded by the Company to directors, officers and other key employees and 126,726 performance share units (“PSUs”) awarded by the Company to Directors, officers and other key employees. Of the issued PSUs, performance conditions will determine how many of them vest and, if performance targets are exceeded, additional PSUs will be issued and vest in accordance with the terms of the relevant PSU award. 

Subsidiary undertakings

The information required by the Companies Act in relation to subsidiary undertakings is presented in note 32 Subsidiary undertakings to the Consolidated Financial Statements.

14





Directors’ Report (continued)
Political donations

The Group made no disclosable political donations in the period.

Going concern

The Directors have a reasonable expectation that the Group has adequate resources to continue in operation for the foreseeable future. For this reason, the Group continues to adopt the going concern basis in preparing the financial statements.

Accounting records

The Directors are responsible for ensuring that adequate accounting records as outlined in Section 281-285 of the Companies Act, are kept by the Company. The Directors are also responsible for the preparation of the Annual Report. The Directors have appointed professionally qualified accounting personnel with appropriate expertise and have provided adequate resources to the finance function in order to ensure that those requirements are met. The accounting records of the Company are maintained at the Group’s principal executive offices at its registered office at Leopardstown, Dublin 18.

Statement of relevant audit information

The Directors believe that they have taken all steps necessary to make themselves aware of any relevant audit information and have established that the Company's statutory auditors are aware of that information. In so far as they are aware, there is no relevant audit information of which the Company's statutory auditors are unaware.

Disclosure of non-financial information
The European Union (Disclosure of Non-Financial and Diversity Information by certain large undertakings and groups) Regulations 2017 require disclosure of certain non-financial information by certain large undertakings and groups.
We have sought to address the requirements of the legislation in the sections following.
Business Model
Our mission is to help our customers accelerate the development of drugs and devices that save lives and improve the quality of life. We help our customers deliver life-changing medicines by being innovative in our solutions, collaborative in how we work as teams, accountable for the results we achieve and committed to doing the right thing for our customers and the patients they serve.
Our business model is described in the ‘Principal activities, business review and future developments’ section of the Directors’ Report.
15





Directors’ Report (continued)
https://cdn.kscope.io/f52cc5955458219e9e64c57bb3033574-culturevaluesslideexte.jpg
Our core values underpin our mission and drive a culture and mind-set of ownership at ICON. “Own it @ ICON” is how we define our culture. Our culture of ownership connects us to the core values at the heart of the Company and helps us differentiate how we work with our customers to achieve their goals.
Our values are:
Accountability & delivery: We take pride in what we do
Collaboration: We are one team
Partnership: We partner with our customers
Integrity: We do the right thing

Our values underpin how we work together to deliver on our mission to help our customers accelerate the development of drugs and devices that save lives and improve the quality of life. These values and our Code of Ethical Conduct, which underpins these values, form the core of everything we do. It applies to all officers, directors, employees, consultants and agents globally. All employees and temporary workers are mandated to complete global ethics training.
1. Environmental matters

ICON is committed to delivering excellence and care to the communities in which we operate
During 2019, ICON established an Environmental, Social, and Governance Committee ('ESG Committee'). The ESG Committee is chaired by the Chief Administrative Officer ('CAO') of the Group. The CAO is responsible for reporting to the ICON leadership team and Board on ESG matters.
The purpose of the ESG Committee is to support the Company's on-going commitment to the environment, social matters, health and safety, corporate social responsibility, corporate governance, sustainability and other public policy matters relevant to the Company.

The ESG Committee is a cross-functional management committee of the Company with representation from facilities, corporate communications, finance, legal, investor relations and human resources departments. The Committee assists and supports executive management and the Board of the Company in;
determining and setting the strategy relating to ESG matters and
developing, implementing and monitoring initiatives and policies based on that strategy


16





Directors’ Report (continued)
ICON is committed to delivering excellence and care to the communities in which we operate. This includes conducting our business in an environmentally sustainable manner as set out in our Global Code of Ethical Conduct. We achieve this by managing and improving our environmental performance across all business activities. Our employees, directors, officers, contractors, and temporary workers are expected to support our sustainability objectives.

As a Clinical Research Organization, we recognize the impact of how we operate on the environment in the following key areas:
energy use;
waste generation;
emissions to air/water;
water use;
transport; and
procurement.

Our Global Environmental Management Policy and Environmental Management Plan were approved during 2018. Our Environmental Management Plan and Performance Statement sets out the environmental actions and targets we will carry out to ensure compliance with our Global Environmental Management Policy and to engage our employees in supporting our objectives for continued improvement. Our Environmental Performance Statement is available to employees and our customers. The plan sets out our commitment to conducting our business in an environmentally sustainable manner by managing and improving our environmental performance across all business activities. Our plan sets out our initiatives and goals for the next four years.
Responsibilities for the implementation of our objectives and co-ordination of our sustainability efforts and reporting on progress to the executive leadership is led by our facilities team, reporting to our Global Chief Administrative Officer and General Counsel, with input from our procurement, global legal, corporate communications and human resources teams through our ESG Committee.
We track, calculate and report our carbon footprint and use the information available to continue to improve our processes and reduce our impact. We follow the Greenhouse Gas (GHG) Protocol Corporate Standard, which is the global corporate accounting and reporting standard for calculating carbon emissions. We have more than 80 facilities globally which operate in office buildings, where the primary energy consumption is electricity for light and heating, ventilation and air conditioning systems. Our central laboratories also operate laboratory instruments.
Where we have direct control over the buildings we operate, we ensure energy efficient lighting solutions. Where we do not have direct control over our facilities, we work with our landlords and other stakeholders to encourage energy efficient lighting solutions. We also work hard to extend the useful life of our equipment and ensure appropriate disposal of assets when decommissioned.
Our people are expected to support our waste management and disposal programmes and one of the goals of our environmental management policy is to reduce our impact. During 2018 we commenced the development of a global waste management system, which has been maintained during 2019.
Reflecting our continued commitment to sustainable practices, we have included an annual 'sustainability month' in our calendar since 2017. The focus of the month is to promote best practices and highlight sustainable activities across all of our offices and locations. This focus together with the introduction of increased recycling facilities at our key sites contributed to our objectives to reduce waste during 2019. We continue to work to increase the number of our offices engaging in waste reduction strategies in all areas. We have replaced disposable coffee cups with reusable alternatives and developed objectives relating to reduced paper consumption through the use of electronic documents and signatures.
We actively promote the use of technology and teleconferencing facilities in our efforts to reduce travel and commuting activities. During sustainability month, our people were encouraged to car share and utilize public transport. We include air travel miles in our carbon footprint monitoring.
Our internal portals include a MyICON page on Environment and Sustainability which reflects policy, practice, promotions and updates on our commitment to sustainability.
We also require our suppliers to abide by our Global Supplier Code of Conduct which includes a commitment to comply with applicable environmental laws and regulations, our expectations around waste management and sustainable use of resources.

17





Directors’ Report (continued)
Principal risks
Although the risks associated with environmental matters are actively monitored, ICON does not believe these risks meet the threshold of a principal risk for our business.
2. Social and Employee matters

Our Corporate Social Responsibility ('CSR') initiatives are aligned with ICON’s values
ICON supports a variety of CSR programmes. Our programmes aim to make a positive difference to the communities in which we work and live and also recognise the enthusiasm and creativity of our people in their efforts to give something back to their communities.
Our CSR activities are focused on two core areas:
Supporting education & building closer ties between industry & academia; and
Improving the welfare of people in the communities in which we live.

Supporting education & building closer ties between industry & academia
ICON is a strong supporter of bridging the ties between industry and academia and inspiring the next generation of business and scientific leaders.
Benefactor through the Centuries of Trinity College Dublin - In February 2020, ICON was recognised as a benefactor of Trinity College Dublin in recognition of the creation of the ICON McKeon Research Fellowship in Motor Neuron Disease in recognition of Declan McKeon, former Board member, acting Chairman, Lead Independent Director and Chair of the ICON Audit committee. The ICON-McKeon Research Fellow in MND will carry out research in the areas of machine-learning and artificial intelligence to derive insights from multimodal clinical, imaging neuro-electric signaling, in the context of the neurodegenerative disease of ALS.
Strategic Partnership with University College Dublin. ICON has been engaged in a strategic partnership with UCD since 2012, which has been heralded as a model for industry-academia collaboration.

Scholarships supporting female GAA players. ICON has a partnership with the Women’s Gaelic Players Association, whereby we provide ICON-GPA Life Sciences Scholarships to inter-county football and camogie players engaged in undergraduate and post-graduate life sciences courses. ICON also provides mentoring to players to help them on their career journeys.

Partnership with Junior Achievement to inspire schoolchildren. ICON supports our people who take time out of their working day over a period of 5 weeks to deliver Junior Achievement educational programmes. Junior Achievement encourages young people to remain in education and teaches them the skills they need to succeed in a changing world. Our volunteers teach primary and secondary level students valuable business, STEM and entrepreneurship skills that will stand them in good stead as they progress through education and beyond.

Science Gallery Founding Partner. ICON has been a lead corporate supporter of the Science Gallery at Trinity College Dublin since its inception in 2008. Science Gallery aims to inspire and transform curious minds through engagement with science.

Improving the welfare of people in the communities in which we live
ICON employees across the world are making a positive difference to their communities. We support causes that are important to our employees and have a number of programmes that support the welfare of people in our local communities. These include:
Corporate donations to employee-nominated charities. In 2019, ICON supported 10 charities across the world which are supporting people living in poverty, who are suffering from a variety of diseases, are the victims of domestic violence, or natural disasters. Over the last five years, ICON has supported over 60 charities across the world.

Donations in support of employee fundraising. ICON employees raise significant amounts for a variety of charities each year through in-house fundraising events. ICON recognizes the enormous effort and creativity of our employees who fundraise for causes that are important to them by supplementing monies raised through ICON’s Charitable Donation Programme.

18





Directors’ Report (continued)
At the core of our strategy is our people
As set-out above, one of our four strategic pillars is 'Talent, Leadership Development and Culture'. Within ICON we have highly qualified and experienced teams, the majority of whom have third level educational qualifications. The need to develop and retain this expertise and talent within the organization is fundamental in enabling us to be the global CRO partner of choice for our customers.

The training and development of our staff is a key focus for us
We have a comprehensive curriculum in place to support our people in their roles. We have invested in creating an innovative learning environment delivered through ICON’s training and development group.
All of our people are required to complete mandatory training in key areas which support our values and our way of working. They include (but are not limited to) the following areas:
Global ethics compliance;
Data protection and procedures;
IT security;
Confidentiality and maintaining communications; and
Social media usage.

We have a well-established Graduate Development Programme for our clinical teams, which now runs in the US, China, Japan, Korea and also Australia where we take recent graduates and prepare them for careers in clinical monitoring and data management.
We also have formed a collaboration with University College Dublin which enables ICON to provide customised management and development programmes for global employees. These programmes are focused on leadership development for those people in management roles and specific technical training in competencies that are core to our business, such as project and programme management and clinical research associate development.
Our learning and development programmes are complemented by advanced people development practices which incorporate rigorous analytics based screening in the hiring process, global career frameworks, pay for performance aligned to our strategy, and on-going talent review and succession planning.
Our leadership and talent programmes contribute to the enhanced retention of our employees, better project deliverables for our customers and the enhanced financial performance of the business.
Individual development is supported through formal learning with our personal effectiveness series and via access to our Career Hub portal. Our people can access a wealth of learning materials including courses, resources, toolkits, library items and blogs to support the development of key competencies and improving their eligibility for future roles through these tools. Career Hub also allows employees to understand and explore possible career paths and career opportunities available to them across the organization and provides full transparency to all levels, skills and capabilities required for every role in ICON.
ICON is proud of this investment in our people. This investment translated to approximately four days training for each person during 2019.
We are also committed to supporting the career aspirations of our people. Approximately 30% of all roles are filled internally.
As an organisation we are keen to hear directly from our employees
Biennially we conduct a global employee engagement survey. Our most recent survey was conducted in October 2018 and had an 88% response rate. There are two key measures which we track closely. The first is Employee Engagement which scored well at 70%, and was on par with the General Industry benchmark. The second is Employee Enablement, which also scored at 70%, 3% above the General Industry benchmark. After each survey we engage in action planning with our people to address areas they have highlighted as important for improvement. The last five years have shown a positive trend for both our engagement and enablement scores. We completed an updated pulse survey during 2019 and a further global employee engagement survey will be completed in 2020.

19





Directors’ Report (continued)
Difference drives innovative thinking and is critical to our success
We believe difference drives innovative thinking, which is critical to our customers, and as a global company with approximately 14,650 employees in 40 countries, we encourage diversity of all kinds. We have grown rapidly, increasing our headcount by more than fifty percent over the past 7 years. As a truly global operation, we are deliberately structured as international teams so that we can support the delivery of our customers' clinical development programmes across multiple geographies. Recruitment, selection and promotion decisions are merit-based and in line with the principles of reaching a wider talent pool and equal opportunity.

Building an inclusive workplace

We believe that difference drives innovative thinking and therefore is critical to our success. During 2019 we established the ICON Diversity & Inclusion Steering Group. This Steering Group is comprised of six members of our Group executive team. The executive leaders are supported by senior members of our human resources group.

At ICON, our leadership team sees diversity and inclusion in the workplace as at the core of how we work. We recognize the importance of ensuring it is built into every aspect of the talent and employee life cycle. The three core principles which are grounded in our values are;

Diversity - we value difference of gender, race, ethnicity, culture and experience. We believe diversity of thought is what drives high performing teams to create better solutions and deliver better outcomes for our customers.

Equality - we ensure all employees are treated fairly and equitably with no barriers to career opportunities. We are committed to equal opportunities for all employees and reflect this in our policies and practices.

Inclusion - we are a values-driven organisation that promotes dignity and respect in all interactions with our customers, our teams and each other. We take pride in our collaborative and inclusive culture where everyone can bring their best selves to their work and deliver the best performance for our customers and patients.

The Executive leadership group defined areas of focus for our Diversity & Inclusion agenda for 2019, which continue into 2020 and against which success will be measured. These key areas of focus are around talent management, country level inclusion policies, reward, training, communications and a renewed focus on culture.

        Our immediate areas of focus around driving inclusion and diversity include:

Training and Development - Under our Diversity and Inclusion Programme, we train all our people leaders to understand unconscious bias and similarity bias and also how to encourage diversity of thought and foster inclusion in their teams. Our diversity and inclusion initiatives were launched at our Company wide Wake up to Culture day during 2019. The fundamentals will be embedded into all people leader programmes, and reflect the values upon which we assess performance behaviours.

Talent - We recognise that more diversity in senior leadership increases organizational performance. In 2019 we launched our global Senior Director Leadership Programme in addition to our Vice President High Potential programme for those people who have been identified as High Performing & High Potential Leaders. These programmes focus on core organisational skills that will enable these individuals to increase their readiness for promotion, as well as create a strong internal network of senior leaders who feel empowered to take hold of their careers. These programmes will help build and support our development of a diverse and inclusive group of future leaders from within and complements existing senior level programmes already in existence in the organisation. Early in 2020, our top 100 employees attended 'Inclusive Leadership training'. This training will be rolled out to our wider employee group from 2020.

Recruitment and progression - We continue to strive to source the best talent in our industry from across the world to fill the highly specialised roles required to help bring new drugs to market. Our most senior roles are truly global in nature. Since 2018, we have mandated gender balanced short lists for senior leadership appointments across the organisation in all markets in which we are located.

Retention - We offer flexible working arrangements that help our people achieve balance. Approximately 45% of our employees work remotely. We also support and facilitate part time working arrangements. Approximately 16% of our people work part-time. We have a bonus programme for all employees linked to individual and company performance and also operate a global recognition programme where peer to peer recognition and awards take place for employees who go the extra mile. We also recognise and reward employees who reach significant service milestones within the company.

20





Directors’ Report (continued)
Reward - The information relating to pay decisions is hosted through core technology, enabling our people leaders and employees direct access to information which informs and supports equitable and consistent decision making. We have made significant investment in organisation design structures, tools and communications which ensures that we have a gender neutral approach to pay decisions. We pay male and female employees equally for the same or equivalent work. We have worked hard to structure our pay principles to ensure that gender is not a factor in how we deliver rewards.

Partnership with Trinity Centre for People with Intellectual Disabilities ('TCPID') - In 2019, we entered into a partnership with the Trinity Centre for people with intellectual disabilities. The TCPID situated within the School of Education, Trinity College Dublin, aims to promote the inclusion of people with intellectual disabilities in education and society. The Centre provides people who have intellectual disabilities with the opportunity to participate in a higher education programme designed to enhance their capacity to fully participate in society as independent adults. The 2-year education programme includes work placements and internships to enable students to experience and participate in the work environment.

Principal risks
For further details on risks relating to employee matters refer to Appendix A: Risk Factors.
Human rights

ICON is committed to acting ethically and with integrity in all our business dealings
We are committed to human rights and the adoption and pursuit of compliance with the United Nations Guiding Principles on Human Rights. Our business model and our policies are intended to fully comply with applicable human rights legislation in the countries in which we operate. ICON’s Global Supplier Code of Conduct also addresses our zero tolerance stance to slavery and human trafficking. ICON is completely opposed to slavery and human trafficking and will not knowingly support or conduct business with any organisation involved in such activities. ICON does not employ anyone below the minimum employment age in the jurisdictions in which we operate.
In our Anti-Slavery and Human Trafficking Statement, we set out the measures we are taking to prevent modern slavery in our supply chains, in addition to our own operations. A copy of our Anti-Slavery and Human Trafficking Statement is available on our website at https://investor.iconplc.com.
Principal Risks
The risks associated with human rights abuses are actively monitored, however we do not believe these risks meet the threshold of a principal risk for our business.
Anti-bribery and Corruption

Our anti-bribery/anti-corruption programme ('ABAC Programme') is a key element of our compliance policy framework, with principles and requirements based on the underlying principal that we do not tolerate bribery or any other form of corruption or fraud. ICON and all ICON directors, employees, consultants and agents (“Covered Persons”) must act in compliance with international laws and regulations relating to bribery, corruption and illicit payments including, the US Foreign Corrupt Practices Act and the UK Bribery Act 2010.
In April 2018, ICON was awarded the ISO 37001:2016 certification for its Anti-Bribery Management System having established, implemented, maintained, reviewed and improved an Anti-Bribery Management System that can prevent, detect and mitigate the risk of bribery. Our programme is designed to ensure our compliance with anti-corruption laws, including due diligence, training, policies, procedures, and internal controls.
There are a number of policies and codes that make up the ABAC Management system including the Global Code of Ethical Conduct, the Global Anti Corruption Compliance Policy, the Ethics Line Charter and the Global Supplier Code of Conduct (together “the Codes”). The Codes are available on our website at https://investor.iconplc.com. All ICON employees are required to complete ICON’s annual Ethics online training, which incorporates the key principles of each of the Codes. The Global Code of Ethical Conduct addresses the core principles underpinning the behaviour required of all Covered Persons in our internal interactions with each other and our external dealings with patients, clients, health care professionals, regulators, investors, vendors and other third parties. Violations of the Codes may result in a variety of corrective actions and in some cases may result in disciplinary action up to and including termination of employment.
21





Directors’ Report (continued)
Bribery and corruption remains a business risk as we conduct our business across the globe and enter into partnerships and collaborations. There is no certainty that all employees and third party business partners (including our vendors, suppliers, agents, contractors, and other partners) will comply with anti-bribery laws. When working with third parties, we are committed to working with only those who embrace high standards of ethical behaviour consistent with our own. Bribery and corruption risks are a focus of our third-party diligence and management process. We hold our suppliers accountable for meeting their contractual obligations with ICON, including commitments that are made with regard to our Global Supplier Code of Conduct and regulatory compliance. Contract non-compliance can result in termination of the business relationship with the supplier and exclusion from future business with ICON.
Suspected violations of the Codes may be reported on a confidential (or anonymous, where permitted) basis in accordance with our Ethics Line Charter through ICON’s Ethics Line. ICON has open door, anti-retaliation policies in place to encourage and protect individuals who raise a concern. Ethics line reports are reported to the Board of ICON plc as appropriate. The Internal Audit team conducts ABAC programme audits. Internal Audits focus on testing for compliance and design effectiveness of the overall ABAC programme, Internal Audit incorporates an assessment of ABAC measures in all audits, as appropriate. In this approach, bribery and corruption risks are incorporated into the risk assessment and scoping process of each audit.
Principal risks
For further details on risks relating to anti-corruption refer to Appendix A: Risk Factors on page 143.
Directors’ compliance statement

The Directors, in accordance with Section 225(2) of the Companies Act 2014, acknowledge that they are responsible for securing the Company’s compliance with its relevant obligations as defined within the Companies Act, 2014 (hereinafter called the relevant obligations).

The Directors confirm that:

a compliance policy statement has been drawn up setting out the Company’s policies with regard to such compliance;
appropriate arrangements and structures that, in their opinion, are designed to secure material compliance with the Company’s relevant obligations, have been put in place; and
a review has been conducted, during the financial year, of the arrangements and structures that have been put in place to secure the Company’s compliance with the relevant obligations.

Auditor

In accordance with Section 383(2) of the Companies Act 2014, KPMG, Chartered Accountants, will continue in office.

On behalf of the Board

Steve Cutler
Rónán Murphy
21 April 2020
Chief Executive Officer
Director
22




Statement of Directors’ Responsibilities in respect of the Directors’ report and the financial statements
The directors are responsible for preparing the annual report and the Group and Company financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare the Group and Company financial statements for each financial year. The directors have elected to prepare the Group and Company financial statements in accordance with IFRS as adopted by the EU and as applied in accordance with the Companies Act 2014.
Under company law the directors must not approve the Group and Company financial statements unless they are satisfied that they give a true and fair view of the assets, liabilities and financial position of the Group and Company and of the Group’s profit or loss for that year. In preparing the Group and Company financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and estimates that are reasonable and prudent;
state whether applicable Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
assess the Group and Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and
use the going concern basis of accounting unless they either intend to liquidate the Group or Company or to cease operations, or have no realistic alternative but to do so.
The directors are responsible for keeping adequate accounting records which disclose with reasonable accuracy at any time the assets, liabilities, financial position of the Group and Company and profit or loss of the Group and which enable them to ensure that the financial statements comply with the provision of the Companies Act 2014. They are responsible for such internal controls as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and have general responsible for safeguarding the assets of the Company and the Group, and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The directors are also responsible for preparing a directors’ report that complies with the requirements of the Companies Act 2014.
The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website. Legislation in the Republic of Ireland governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.














On behalf of the Board

Steve Cutler
Rónán Murphy
Chief Executive Officer
Director
23





Independent Auditor’s Report to the members of ICON plc
Report on the audit of the financial statements
Opinion 
We have audited the financial statements of ICON plc (‘the Company’) and subsidiaries (together, “the Group”) for the year ended 31 December 2019, set out on pages 28 to 138, which comprise the Consolidated Statement of Profit and Loss, Consolidated Statement of Comprehensive Income, Consolidated and Company Statements of Financial Position, Consolidated and Company Statements of Changes in Equity, Consolidated and Company Statements of Cash Flows and related notes, including the summary of significant accounting policies set out in note 1.The financial reporting framework that has been applied in their preparation is Irish Law and International Financial Reporting Standards (IFRS) as adopted by the European Union.
In our opinion:
the Consolidated Financial Statements give a true and fair view of the assets, liabilities and financial position of the Group as at 31 December 2019 and of the Group’s profit for the year then ended;
the Company Statement of Financial Position gives a true and fair view of the assets, liabilities and financial position of the Company as at 31 December 2019;
the Consolidated Financial Statements have been properly prepared in accordance with IFRS as adopted by the European Union;
the Company Financial Statements have been properly prepared in accordance with IFRS as adopted by the European Union, as applied in accordance with the provisions of the Companies Act 2014; and
the Consolidated Financial Statements and Company Financial Statements have been properly prepared in accordance with the requirements of the Companies Act 2014.

Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (Ireland) (ISAs (Ireland)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We have fulfilled our ethical responsibilities under, and we remained independent of the Group in accordance with ethical requirements that are relevant to our audit of financial statements in Ireland, including the Ethical Standard issued by the Irish Auditing and Accounting Supervisory Authority (IAASA), as applied to listed entities.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key audit matters: our assessment of risks of material misstatement
Key audit matters are those matters that, in our professional judgment, were of most significance in the audit of the financial statements and include the most significant assessed risks of material misstatement (whether or not due to fraud) identified by us, including those which had the greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
In arriving at our audit opinion above, the key audit matter was as follows:
Evaluation of progress towards completion and realisable contract value related to revenue recognition for clinical trial service contracts
As described in note 1, significant accounting policies, and in note 2, segmental information, the Group’s revenues were US $2,806 million for the year ended 31 December 2019 (2018: US$2,596 million). A significant portion of this revenue relates to clinical trial service revenue. Clinical trial service revenue is recognised over time using an input measure, being total project costs (inclusive of third-party costs).
The key audit matter
Clinical trial service revenue is recognised using project costs incurred to date relative to total estimated costs to complete to measure progress towards satisfying the Company’s performance obligation. Contracts generally contain provisions for renegotiation in the event of changes in the scope, nature, duration or volume of services of the contract. Renegotiated amounts are recognised as revenue by revision to the total contract value arising as a result of the change order. Furthermore, the transaction price is determined by adjusting the contract or change order value to reflect a realisable contract value.
24





Independent Auditor’s Report to the members of ICON plc (continued)


We identified the evaluation of progress towards completion and realisable contract value related to revenue recognition for clinical trial services contracts as a key audit matter. Complex and subjective auditor judgement was required to evaluate the Company’s estimate regarding the direct costs and costs that will be incurred by third parties to complete the contracts, based on historical experience and estimated realisable contract values on clinical trial service contracts.
How the matter was addressed in our audit
Our audit procedures included, amongst others:
We tested the operarting effectiveness of certain internal controls over the Company’s revenue recognition for the clinical trial service contracts process. These included controls over the development of the estimated direct costs and costs that will be incurred by third parties to complete the contracts and estimated realisable contract values.
We tested the estimated costs to complete and the realisable contract values for a sample of clinical trial service contracts, by evaluating:
Actual direct costs incurred, both during the year and life-to-date, to assess the consistency with the estimated direct costs for that time period. We compared actual direct costs incurred to source timesheet data and hourly rates to underlying contractual terms;
Third-party costs incurred, to assess the consistency with the estimated third-party costs for that time period. We compared third-party costs incurred to invoices received;
Findings from interviews with operational personnel of the Company to evaluate progress to date, the estimate of remaining costs to be incurred and factors impacting the amount of time and cost to complete the sampled contracts, including the assessment of the nature and complexity of the work to be performed;
Correspondence, if any, between the Company and the customer for the sampled contracts as part of our evaluation of contract progress;
Changes to estimated costs, including the amount and timing of the changes; and
The basis for the realisable contract value assumptions and challenging these assumptions. We confirmed contract terms with customers and assessed the realisable contract values by comparing the assumptions to underlying records, including final contract invoices received.
We also evaluated the Company’s ability to accurately estimate costs to complete and realisable contract values, by comparing historical estimates developed at contract inception to actual results for a sample of contracts.
Our procedures in respect of this risk were performed as planned. We found that the estimates and judgements used in determining the progress towards completion and realisable contract value related to revenue recognition for clinical trial services contracts were appropriate.
Parent Company key audit matters
Due to the nature of the Parent Company’s activities, there are no key audit matters that we are required to communicate in accordance with ISAs (Ireland).
Our application of materiality and an overview of the scope of our audit
Materiality for the Group Financial Statements as a whole was set at US$20 million (2018: US$17.5 million). Materiality for the Company Financial Statements was set at US$9.5 million (2018: US$8 million).
For the Group, materiality has been calculated as 5% of the benchmark of expected Group profit before tax (this estimated amount was based on earnings guidance available at the planning stage of the audit), which we have determined in our professional judgement, to be one of the principal benchmarks within the financial statements relevant to members of the Company in assessing the financial performance of the Group. For the Parent Company, materiality has been calculated based on 1% of the benchmark of total assets.
We report to the Audit Committee all corrected and uncorrected audit misstatements we identified through our audit in excess of US$1.0 million (Group) and US$0.5 million (Company), in addition to other audit misstatements below that threshold that we believe warranted reporting on qualitative grounds.
25





Independent Auditor’s Report to the members of ICON plc (continued)


The structure of the Group’s finance function is such that the majority of transactions and balances are accounted for by the central Group finance team. We performed comprehensive audit procedures, including those in relation to the significant risk set out above, on those transactions accounted for at Group level. Our audit covered 98% of total Group revenue and 98% of total Group assets, including 100% of the Parent Company’s revenue and total assets.
All audit procedures were undertaken by the Group audit team.
We have nothing to report on going concern
We are required to report to you if we have concluded that the use of the going concern basis of accounting is inappropriate or there is an undisclosed material uncertainty that may cast significant doubt over the use of that basis for a period of at least twelve months from the date of approval of the financial statements. We have nothing to report in these respects.

Other information
The directors are responsible for the other information presented in the Annual Report together with the financial statements. The other information comprises the information included in the directors’ report. The financial statements and our auditor’s report thereon do not comprise part of the other information. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except as explicitly stated below, any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether, based on our financial statements audit work, the information therein is materially misstated or inconsistent with the financial statements or our audit knowledge. Based solely on that work we have not identified material misstatements in the other information.
Based solely on our work on the other information, we report that, in those parts of the directors’ report specified for our consideration:
we have not identified material misstatements in the directors’ report;
in our opinion, the information given in the directors’ report is consistent with the financial statements;
in our opinion, the directors’ report has been prepared in accordance with the Companies Act 2014.

Our opinions on other matters prescribed by the Companies Act 2014 are unmodified
We have obtained all the information and explanations which we consider necessary for the purpose of our audit.
In our opinion, the accounting records of the Company were sufficient to permit the financial statements to be readily and properly audited and the Company’s financial statements are in agreement with the accounting records.

We have nothing to report on other matters on which we are required to report by exception
The Companies Act 2014 requires us to report to you if, in our opinion, the disclosures of directors’ remuneration and transactions required by Sections 305 to 312 of the Act are not made.
The Companies Act 2014 also requires us to report to you if, in our opinion, the Company has not provided the information required by section 5(2) to (7) of the European Union (Disclosure of Non-Financial and Diversity Information by certain large undertakings and groups) Regulations 2017 for the year ended 31 December 2018 as required by the European Union (Disclosure of Non-Financial and Diversity Information by certain large undertakings and groups) (amendment) Regulations 2018.

Respective responsibilities and restrictions on use

Directors’ responsibilities
As explained more fully in their statement set out on page 23, the directors are responsible for: the preparation of the financial statements including being satisfied that they give a true and fair view; such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error; assessing the Group and Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and using the going concern basis of accounting unless they either intend to liquidate the Group or Company or to cease operations, or have no realistic alternative but to do so.

26





Independent Auditor’s Report to the members of ICON plc (continued)


Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (Ireland) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
A fuller description of our responsibilities is provided on IAASA’s website at https://www.iaasa.ie/getmedia/b2389013-1cf6-458b-9b8f-a98202dc9c3a/Description_of_auditors_responsiblities_for_audit.pdf.

The purpose of our audit work and to whom we owe our responsibilities
Our report is made solely to the Company’s members, as a body, in accordance with Section 391 of the Companies Act 2014. Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s members, as a body, for our audit work, for our report, or for the opinions we have formed.
            


Emer McGrath           April 22, 2020
for and on behalf of
KPMG
Chartered Accountants, Statutory Audit Firm
1 Stokes Place
St. Stephen’s Green
Dublin 2
Ireland

27




Consolidated Statement of Profit and Loss
for the year ended 31 December 2019
31 December
2019
31 December
2018
31 December
2018
31 December
2018
Excluding
Exceptional items
(Note 8)
Exceptional items
Including
Exceptional items
Continuing OperationsNote$’000$’000$’000$’000
Revenue 2,805,839  2,595,777  —  2,595,777  
Direct costs(1,973,621) (1,816,270) (10,017) (1,826,287) 
Other operating expenses
(396,087) (389,899) (2,473) (392,372) 
Operating profit
436,131  389,608  (12,490) 377,118  
Financing income46,859  4,759  —  4,759  
Financing expense5(24,625) (13,502) —  (13,502) 
Profit before taxation3418,365  380,865  (12,490) 368,375  
Income tax expense6(57,332) (47,011) 1,453  (45,558) 
Profit for the financial year361,033  333,854  (11,037) 322,817  
Profit for the financial year is attributable to:
Owners of the Company
25
359,163  333,854  (11,037) 322,817  
Noncontrolling interest25  1,870  —  —  —  
Profit for the financial year attributable to the Group361,033  333,854  (11,037) 322,817  
Earnings per ordinary share
Basic76.70  5.96  
Diluted76.64  5.90  

On behalf of the Board

Steve Cutler
Rónán Murphy
Chief Executive Officer
Director
28




Consolidated Statement of Comprehensive Income
for the year ended 31 December 2019
Note31 December
2019
31 December
2018
$’000$’000
Other Comprehensive Income
Items that will not be reclassified to profit or loss:
Re-measurement of defined benefit liability10(2,407) 2,640  
Total items that will not be reclassified to profit or loss(2,407) 2,640  
Items that are or may be reclassified subsequently to profit or loss, net of tax:
Currency translation differences25(1,313) (26,522) 
Currency impact on long-term funding25(2,710) (4,834) 
Unrealised capital gain/(loss) on investments25681  (155) 
Amortisation of interest rate hedge25(923) (923) 
Cash flow hedges - effective portion of changes in fair value 25—  (1,036) 
Total items that are or may be reclassified to profit or loss(4,265) (33,470) 
Other comprehensive loss for the year, net of tax(6,672) (30,830) 
Profit for the financial year361,033  322,817  
Total comprehensive income for the financial year354,361  291,987  
Attributable to:
Equity holders of the Company352,491  291,987  
Noncontrolling interest1,870  —  
Total comprehensive income for the financial year354,361  291,987  

On behalf of the Board

Steve Cutler
Rónán Murphy
Chief Executive Officer
Director
29




Consolidated Statement of Financial Position
as at 31 December 2019
Note31 December
2019
31 December
2018
ASSETS$’000$’000
Non-current assets
Property, plant and equipment12104,257  103,710  
Right-of-use assets27  103,962  —  
Intangible assets – goodwill and other131,025,903  879,283  
Other non-current assets1724,741  20,778  
Financial assets18  10,053  6,963  
Deferred tax assets634,755  31,665  
Total non-current assets1,303,671  1,042,399  
Current assets
Inventories153,181  2,274  
Accounts receivable16527,708  414,791  
Unbilled revenue16422,769  362,926  
Other current assets1770,325  68,734  
Current taxes receivable40,989  39,468  
Current asset investments1849,628  59,910  
Cash and cash equivalents19520,309  395,851  
Total current assets1,634,909  1,343,954  
Total assets2,938,580  2,386,353  
EQUITY
Share capital244,635  4,658  
Share premium 305,228  283,629  
Other undenominated capital251,052  983  
Share-based payment reserve25174,230  173,326  
Other reserves2510,874  11,868  
Foreign currency translation reserve25(71,492) (67,469) 
Current asset investments - fair value reserve25231  (450) 
Put option in noncontrolling interest shares25(38,482) —  
Retained earnings251,220,871  979,834  
Total equity attributable to the owners of the Company1,607,147  
Noncontrolling interest2534,462  —  
Total equity attributable to the owners of the Company and noncontrolling interest1,641,609  1,386,379  
LIABILITIES
Non-current liabilities
Non-current bank credit lines and loan facilities23—  349,264  
Non-current lease liabilities2776,593  —  
Non-current other liabilities2017,899  13,022  
Non-current provisions21405  1,301  
Deferred tax liabilities69,296  8,213  
Total non-current liabilities104,193  371,800  
Current liabilities
Accounts payable24,050  13,288  
Unearned revenue16  366,988  274,468  
Accrued and other liabilities20422,036  309,943  
Provisions213,732  7,200  
Current tax payable26,332  23,275  
Current bank credit lines and loan facilities23  349,640  —  
Total current liabilities1,192,778  628,174  
Total liabilities1,296,971  999,974  
Total equity attributable to the owners of the company and noncontrolling interest and liabilities2,938,580  2,386,353  

On behalf of the Board
Steve Cutler
Rónán Murphy
Chief Executive Officer
Director
30




Consolidated Statement of Changes in Equity
for the year ended 31 December 2019
Number
of shares
Share
Capital
Share
Premium
Other
Undenominated
Capital
Share-based
Payment Reserve
Other
Reserves
Currency
Reserve
Financial assets at fair value through other comprehensive income reservePut option in noncontrolling interest sharesRetained
Earnings
Sub totalNoncontrolling interestTotal
$’000$’000$’000$’000$’000$’000$’000$’000$’000$’000$’000$’000
Balance at 1 January 201953,971,706  4,658  283,629  983  173,326  11,868  (67,469) (450) —  979,834  1,386,379  —  1,386,379  
Profit for the year attributable to the Group—  —  —  —  —  —  —  —  —  359,163  359,163  —  359,163  
Profit for the year attributable to redeemable noncontrolling interest—  —  —  —  —  —  —  —  —  —  —  1,870  1,870  
Other Comprehensive Income:—  
Foreign currency translation—  —  —  —  —  —  (1,313) —  —  —  (1,313) —  (1,313) 
Currency impact on long-term funding—  —  —  —  —  —  (2,710) —  —  —  (2,710) —  (2,710) 
Cash flow hedge—  —  —  —  —  —  —  —  —  —  —  —  —  
Unrealised fair value movements on investments—  —  —  —  —  —  —  681  —  —  681  —  681  
Re-measurement of defined benefit liability—  —  —  —  —  —  —  —  —  (2,407) (2,407) —  (2,407) 
Tax benefit on defined benefit pension contributions—  —  —  —  —  —  —  —  —  —  —  —  —  
Amortisation of interest rate hedge—  —  —  —  —  (923) —  —  —  —  (923) —  (923) 
Total other comprehensive income—  —  —  —  —  (923) (4,023) 681  —  (2,407) (6,672) —  (6,672) 
Total comprehensive income for the year—  —  —  —  —  (923) (4,023) 681  —  356,756  352,491  1,870  354,361  
Transactions with owners, recorded directly in equity—  
Share-based payment—  —  —  —  25,800  —  —  —  —  —  25,800  —  25,800  
Exercise of share options329,870  22  21,599  —  —  —  —  —  —  —  21,621  —  21,621  
Transfer of exercised and expired  share–based awards  —  —  —  —  (31,261) —  —  —  —  31,261  —  —  —  
Issue of restricted share units/ performance share units355,730  24  —  —  —  —  —  —  —  —  24  —  24  
Share issue costs—  —  —  —  —  —  —  —  —  (13) (13) —  (13) 
Repurchase of ordinary shares(1,035,100) (69) —  69  —  —  —  —  —  (146,931) (146,931) —  (146,931) 
Share repurchase costs—  —  —  —  —  —  —  —  —  (107) (107) —  (107) 
Tax benefit excess on exercise of options—  —  —  —  7,046  —  —  —  —  —  7,046  —  7,046  
Deferred tax movement on unexercised options—  —  —  —  (681) —  —  —  —  —  (681) —  (681) 
Acquisition of noncontrolling interest—  —  —  —  —  —  —  —  —  —  —  32,592  32,592  
Put option on noncontrolling interest shares—  —  —  —  —  —  —  —  (38,482) —  (38,482) —  (38,482) 
Non-distributable reserves—  —  —  —  —  (71) —  —  —  71  —  —  —  
Total contributions by and distributions to owners (349,500) (23) 21,599  69  904  (71) —  —  (38,482) (115,719) (131,723) 32,592  (99,131) 
Balance at 31 December 201953,622,206  4,635  305,228  1,052  174,230  10,874  (71,492) 231  (38,482) 1,220,871  1,607,147  34,462  1,641,609  
31





Consolidated Statement of Changes in Equity
for the year ended 31 December 2018
Number
of shares
Share
Capital
Share
Premium
Other
Undenominated
Capital
Share-based
Payment Reserve
Other
Reserves
Currency
Reserve
Financial assets at fair value through other comprehensive income reserveRetained
Earnings
Total
$’000$’000$’000$’000$’000$’000$’000$’000$’000
Balance at 31 December 201754,081,601  4,664  266,852  912  187,840  11,029  (35,077) (295) 794,331  1,230,256  
Cumulative effect adjustment from adoption of IFRS 15—  —  —  —  —  —  —  —  (48,104) (48,104) 
Balance at 1 January 201854,081,601  4,664  266,852  912  187,840  11,029  (35,077) (295) 746,227  1,182,152  
Profit for the year—  —  —  —  —  —  —  —  322,817  322,817  
Other Comprehensive Income:
Foreign currency translation—  —  —  —  —  —  (26,522) —  —  (26,522) 
Currency impact on long-term funding—  —  —  —  —  —  (4,834) —  —  (4,834) 
Cash flow hedge—  —  —  —  —  —  (1,036) —  —  (1,036) 
Unrealised fair value movements on investments—  —  —  —  —  —  —  (155) —  (155) 
Re-measurement of defined benefit liability—  —  —  —  —  —  —  —  2,640  2,640  
Tax benefit on defined benefit pension contributions—  —  —  —  —  —  —  —  —  —  
Amortisation of interest rate hedge—  —  —  —  —  (923) —  —  —  (923) 
Total other comprehensive income—  —  —  —  —  (923) (32,392) (155) 2,640  (30,830) 
Total comprehensive income for the year—  —  —  —  —  (923) (32,392) (155) 325,457  291,987  
Transactions with owners, recorded directly in equity
Share-based payment—  —  —  —  28,009  —  —  —  —  28,009  
Exercise of share options408,699  29  16,777  —  —  —  —  —  —  16,806  
Transfer of exercised and expired  share–based awards  —  —  —  —  (38,954) —  —  —  38,954  —  
Issue of restricted share units/ performance share units489,568  36  —  —  —  —  —  —  —  36  
Share issue costs—  —  —  —  —  —  —  —  (16) (16) 
Repurchase of ordinary shares(1,008,162) (71) —  71  —  —  —  —  (128,960) (128,960) 
Share repurchase costs—  —  —  —  —  —  —  —  (66) (66) 
Tax benefit excess on exercise of options—  —  —  —  4,626  —  —  —  —  4,626  
Deferred tax movement on unexercised options—  —  —  —  (8,195) —  —  —  —  (8,195) 
Non-distributable reserves—  —  —