Highlights – Third Quarter 2010

* Net revenue of $225 million, a 2% increase vs. Q3 2009

* Operating margin of 12.0% before central lab and foreign exchange translation losses.

* Operating margin of 7.8% on a GAAP basis

* GAAP EPS of 33 cent

* Net cash rises to $231 million

* Gross new business wins for the quarter of $317m (net $225m)

ICON (NASDAQ: ICLR) )(ISIN:IE0005711209), a global provider of outsourced development services to the pharmaceutical, biotechnology and medical device industries, today reported its financial results for the third quarter ended September 30, 2010.

Net revenues for the quarter were $225 million, representing a 2% increase over net revenues of $220 million for the same quarter last year. On a constant currency basis revenue grew by 7%. Year-to-date, net revenues were $668 million, representing a 1% increase over the same period last year.

Income from operations was $17.6 million or 7.8% of revenue, after the central lab incurred operating losses of approx $4.6 million and a further $3.0 million of cost reduction and other non-recurring charges. In addition, foreign exchange translation losses of $1.8 million were incurred. Excluding these, operating income was $27 million compared to $30.4 million for the same quarter last year.

The company recognised a tax gain in the current quarter of $2.0m, compared to $5.8m of a charge in Q3 2009.

Net income was $19.9 million or 33 cents per share on a diluted basis, compared to $23.9 million or 40 cents per share last year.

Days sales outstanding, comprising accounts receivable and unbilled revenue less payments on account, were 36 days at September 30, 2010, compared to 33 days at December 31, 2009.

The company’s net cash, amounted to $231 million at September 30, 2010, compared to net cash of $221 million at the end of June 2010 and $194 million at December 31, 2009.

“Our clinical business had another solid quarter and gross new business awards were in line with expectations at $317 million and net bookings were $225 million.” commented CEO Mr Peter Gray. “The expansion of our central lab global footprint continues to be validated by another strong quarter of business wins yielding a year-to-date net book to bill of 1.8. However, this growing backlog did not convert to revenue as quickly as forecast. Cost reduction actions have already been taken and further cost alignment measures are planned. Overall, ICON remains in a strong position and continues to invest in its business in order to benefit from the opportunities that are arising as our customers transition to new development models.”

In addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), this press release contains certain non-GAAP financial measures, including non-GAAP operating and net income and non-GAAP diluted earnings per share. While non-GAAP financial measures are not superior to or a substitute for the comparable GAAP measures, ICON believes certain non-GAAP information is useful to investors for historical comparison purposes.

The company will hold its third quarter conference call today, October 21, 2010 at 9:00 EST [14:00 Ireland & UK]. This call and linked slide presentation can be accessed live from our website at http://www.iconplc.com. A recording will also be available on the website for 90 days following the call. In addition, a calendar of company events, including upcoming conference presentations, is available on our website, under “Investors”. This calendar will be updated regularly.

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.

ICON plc is a global provider of outsourced development services to the pharmaceutical, biotechnology and medical device industries. The Company specialises in the strategic development, management and analysis of programs that support clinical development - from compound selection to Phase I-IV clinical studies. With headquarters in Dublin, Ireland, ICON currently, operates from 71 locations in 39 countries and has approximately 7,800 employees. Further information is available at www.iconplc.com.

Source: ICON plc
                   
 

 
 
         

ICON plc
 
Consolidated Income Statements (Unaudited) (Before one time net charges)
 
Three and Nine Months ended September 30, 2010 and September 30, 2009
(Dollars, in thousands, except share and per share data)
 
Three Months Ended Nine Months Ended
September

30,
September

30,
September

30,
September

30,
2010 2009 2010 2009
 
Gross Revenue 323,230 317,179 945,868 936,686
 
Reimbursable expenses 98,135 96,818 277,910 276,493
       
Net Revenue 225,095 220,361 667,958 660,193
 
Costs and expenses
Direct costs 139,460 127,179 401,647 376,493
Selling, general and administrative 60,008 54,369 171,225 173,637
Depreciation and amortization 8,002 8,404 25,005 23,420
       
Total costs and expenses 207,470 189,952 597,877 573,550
 
Income from operations 17,625 30,409 70,081 86,643
 
Net interest income/(expense) 276 (693) 145 (2,304)
       
Income before provision for income taxes 17,901 29,716 70,226 84,339
 
Provision for income taxes 1,998 (5,765) (5,255) (16,687)
       
 
Net income 19,899 23,951 64,971 67,652
 
Net income per ordinary share
Basic $0.33 $0.41 $1.09 $1.15
 
Diluted $0.33 $0.40 $1.07 $1.13
 
Weighted average number of ordinary shares
Basic 59,940,045 58,624,028 59,576,777 58,579,402
 
Diluted 60,743,403 59,953,574 60,576,058 59,781,092

 

 

 

ICON plc
           
Consolidated Income Statements (Unaudited) (US GAAP)
 
Three and Nine Months ended September 30, 2010 and September 30, 2009
(Dollars, in thousands, except share and per share data)
 
Three Months Ended Nine Months Ended
September

30,
September

30,
September

30,
September

30,
2010 2009 2010 2009
 
Gross Revenue 323,230 317,179 945,868 936,686
 
Reimbursable expenses 98,135 96,818 277,910 276,493
       
Net Revenue 225,095 220,361 667,958 660,193
 
Costs and expenses
Direct costs 139,460 127,179 401,647 376,493
Selling, general and administrative 60,008 54,369 171,225 173,637
Depreciation and amortization 8,002 8,404 25,005 23,420
One time net charges       8,941
Total costs and expenses 207,470 189,952 597,877 582,491
 
Income from operations 17,625 30,409 70,081 77,702
 
Net interest income/(expense) 276 (693) 145 (2,304)
       
Income before provision for income taxes 17,901 29,716 70,226 75,398
 
Provision for income taxes 1,998 (5,765) (5,255) (11,973)
       
 
Net income 19,899 23,951 64,971 63,425
 
Net income per ordinary share
Basic $0.33 $0.41 $1.09 $1.08
 
Diluted $0.33 $0.40 $1.07 $1.06
 
Weighted average number of ordinary shares
Basic 59,940,045 58,624,028 59,576,777 58,579,402
 
Diluted 60,743,403 59,953,574 60,576,058 59,781,092

           
ICON plc
 
Summary Balance Sheet Data
 
 
September 30, 2010 and December 31, 2009
(Dollars, in thousands)
 
September 30, December 31,
2010 2009
(Unaudited) (Audited)
 
 
Net cash 231,289 194,028
 
Accounts receivable 174,375 191,924
Unbilled revenue 97,218 92,080
Payments on account (143,583) (165,198)
Total 128,010 118,806
 
Working Capital 306,478 235,906
 
Total Assets 937,857 908,398
 
Shareholder's Equity 647,163 572,246
 
 
Source: ICON plc
 
Contact: Investor Relations 1-888-381-7923 or
Ciaran Murray CFO + 353 1 291 2000
Brendan Brennan VP Corp Fin+353 12912000

All at ICON.
 

http://www.iconplc.com

ICON/ICLR-F

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