ICON Reports 46% Increase in Fourth Quarter Net Revenue, 65% Increase in Operating Income and 75% increase in EPS
ICON (NASDAQ:ICLR), a global provider of outsourced development
services to the pharmaceutical, biotechnology and medical device
industries, today reported its financial results for the fourth
quarter ended December 31, 2006. As a consequence of the change of
financial year, the comparative quarter mentioned in this press
release will be the quarter ended November 30, 2005. ICON completed a
bonus issue of shares (effectively a share spilt) during the year. The
number of weighted average shares in this press release reflects the
share split in both the current and comparative figures.
Net revenues for the quarter were $129.0 million, representing a
46% increase over net revenues of $88.1 million for the comparative
quarter last year.
Income from operations, on a US GAAP basis, was $13.8 million and
net income was $11.4 million or 39 cents per share on a diluted basis.
Adjusting these figures to exclude $1.1 million in relation to the
expensing of stock compensation in accordance with SFAS No.123(R),
income from operations was $14.9 million, compared to $9.0 million
last year and net income was $12.4 million or a diluted 42 cents per
share, compared with $7.0 million or 24 cents per share last year.
Adjusted operating margin was 11.5%, compared with 10.2% for last
year.
Full year, net revenues were $455.6 million, a 33% increase over
last year. Income from operations was $47.8 million and net income was
$38.3 million or 133 cents per share on a diluted basis. Adjusting
these figures to exclude $4.1 million in relation to the expensing of
stock compensation in the current year and the one-time charge of
$11.3 million, relating primarily to the impairment of goodwill in the
prior year, income from operations for the year ended December 31,
2006 was $51.9 million, an increase of 69% from $30.8 million last
year and operating margin was 11.4%, compared with 9.0% for last year.
Adjusted net income was $42.4 million or a diluted 145 cents share,
compared with $24.3 million, or 86 cents per share last year.
Days sales outstanding, comprising accounts receivable and
unbilled revenue less payments on account, were 53 days at December
31, 2006, a decrease from 65 days at December 31, 2005.
For the quarter ended December 31, 2006, cash in-flow from
operating activities was $17.5 million, $0.2 million was spent in
relation to acquisitions and capital expenditure was $12.3 million, of
which $6.6 million related to the extension of our Dublin facility.
Full year, cash in-flow from operating activities was $50.5 million
and capital expenditure was $31.5 million. As a result, the company's
cash and short-term investments, net of debt, amounted to $97.9
million at December 31, 2006, compared to $90.7 million at September
30, 2006 and $77.5 million at December 31, 2005.
"2006 has been an outstanding year for ICON", commented Chairman
Dr. John Climax. "Our Central Lab achieved a significant turnaround
from losses of $6.6 million last year to profits of $1.3 million. Our
clinical segment achieved very strong growth in 2006 and improved its
margins from 11.9% in 2005, to 12.4%. With a record backlog of $872
million, we look forward with confidence to 2007"
The company will hold its fourth quarter conference call today,
February 13, 2007 at 10:00 EST (15:00 Ireland & UK). This call and
linked slide presentation can be accessed live from our website at
http://www.iconclinical.com. A recording will also be available on the
website for 90 days following the call. In addition, a calendar of
company events, including upcoming conference presentations, is
available on our website, under "shareholders services". This calendar
will be updated regularly.
The statements made in this Press Release may contain
forward-looking statements that involve a number of risks and
uncertainties. In addition to the matters described in this Press
Release, the ability to maintain large client contracts or enter into
new contracts, maintain client relationships and the ability to manage
the opening of new offices, the integration of new business mergers
and acquisitions, as well as other risks and uncertainties detailed
from time to time in SEC reports filed by ICON, including its Form
20-F, F-1, S-8 and F-3, may affect the actual results achieved by
ICON. ICON disclaims any intent or obligation to update these
forward-looking statements.
The financial information presented herein has been prepared in
accordance with U.S. GAAP.
ICON plc is a global provider of outsourced development services
to the pharmaceutical, biotechnology and medical device industries.
The Company specializes in the strategic development, management and
analysis of programs that support clinical development - from compound
selection to Phase I-IV clinical studies. ICON teams have successfully
conducted over 1,900 development projects and over 2,300 consultancy
engagements across all major therapeutic areas. ICON currently has
over 4,300 employees, operating from 49 locations in 30 countries.
Further information is available at www.iconclinical.com.
-0-
*T
ICON plc
Consolidated Income Statements
Three and Twelve Months ended December 31, 2006 and November 30, 2005
(Dollars, in thousands, except share and per share data)
Three Months Ended Twelve Months Ended
December November December November
31, 30, 31, 30,
2006 2005 2006 2005
Gross Revenue 184,329 120,344 649,826 471,016
Subcontractor costs 55,377 32,272 194,229 128,199
----------- ----------- ----------- -----------
Net Revenue 128,952 88,072 455,597 342,817
Costs and expenses
Direct costs 73,117 48,721 256,263 189,568
Selling, general and
administrative 38,092 26,824 136,569 108,558
Depreciation and
amortization 3,940 3,509 14,949 13,916
One-time charges - - - 11,275
----------- ----------- ----------- -----------
Total costs and
expenses 115,149 79,054 407,781 323,317
Income from operations 13,803 9,018 47,816 19,500
Interest income (net) 1,104 603 3,640 1,654
----------- ----------- ----------- -----------
Income before provision
of income taxes 14,907 9,621 51,456 21,154
Provision for income
taxes 3,428 2,618 12,924 7,297
Minority Interest 107 50 228 100
----------- ----------- ----------- -----------
Net income 11,372 6,953 38,304 13,757
=========== =========== =========== ===========
Net income per ordinary
share
Basic $0.40 $0.25 $1.35 $0.49
----------- ----------- ----------- -----------
Diluted $0.39 $0.24 $1.33 $0.49
----------- ----------- ----------- -----------
Weighted average number
of ordinary shares
Basic 28,493,566 28,010,909 28,314,985 27,839,643
Diluted 29,427,297 28,523,467 28,863,334 28,294,977
*T
-0-
*T
ICON plc
Adjusted Consolidated Income Statements (a)
Three and Twelve Months ended December 31, 2006 and November 30, 2005
(Dollars, in thousands, except share and per share data)
Three Months Ended Twelve Months Ended
December November December November
31, 30, 31, 30,
2006 2005 2006 2005
Gross Revenue 184,329 120,344 649,826 471,016
Subcontractor costs 55,377 32,272 194,229 128,199
----------- ----------- ----------- -----------
Net Revenue 128,952 88,072 455,597 342,817
Costs and expenses
Direct costs 72,526 48,721 254,023 189,568
Selling, general and
administrative 37,610 26,824 134,743 108,558
Depreciation and
amortization 3,940 3,509 14,949 13,916
----------- ----------- ----------- -----------
Total costs and
expenses 114,076 79,054 403,715 312,042
Income from operations (a) 14,876 9,018 (a) 51,882 (b) 30,775
Interest income (net) 1,104 603 3,640 1,654
----------- ----------- ----------- -----------
Income before provision
of income taxes 15,980 9,621 55,522 32,429
Provision for income
taxes 3,428 2,618 12,924 8,022
Minority Interest 107 50 228 100
----------- ----------- ----------- -----------
Net income 12,445 6,953 42,370 24,307
=========== =========== =========== ===========
Net income per ordinary
share
Basic $0.44 $0.25 $1.50 $0.87
----------- ----------- ----------- -----------
Diluted $0.42 $0.24 $1.45 $0.86
----------- ----------- ----------- -----------
Weighted average number
of ordinary shares
Basic 28,493,566 28,010,909 28,314,985 27,839,643
Diluted 29,685,145 28,523,467 29,314,617 28,294,977
*T
(a) Excluded from the quarter to December 31, 2006, is the
non-cash stock compensation expense of $1.073 million ($4.066
million for the twelve months to December 31, 2006) relating
to stock options expensed in accordance with SFAS No. 123(R).
Also excluded from this quarter, is the adjustment of 257,848
shares (and 451,283 shares for the twelve months ended
December 31, 2006) on the diluted share number which is a
consequence of the adoption of the standard.
(b) The twelve month period ended November 30, 2005, excludes a
one-time charge of $11.3 million, relating to the recognition
in the quarter to February 28, 2005, of an impairment of the
goodwill associated with the Central Laboratory business,
certain assets, lease termination costs and exit costs, net of
the tax deduction thereon.
-0-
*T
ICON plc
Summary Balance Sheet Data
December 31, 2006 and December 31, 2005
(Dollars, in thousands)
December 31, December 31,
2006 2005
(audited) (audited)
Cash and short-term investments 102,861 82,318
Short-term debt 5,000 4,856
Net cash 97,861 77,462
Accounts receivable 108,216 71,450
Unbilled revenue 89,977 62,270
Payments on account (90,394) (50,211)
Total 107,799 83,509
Working Capital 160,321 132,312
Total assets 476,341 349,067
Shareholder's equity 302,738 241,558
*T