Full Press Release Details
Reports Fourth-Quarter and Full-Year 2017 Results, Issues First-Quarter
and Full-Year 2018 Guidance
of $2,161 million for the fourth quarter and $8,060 million for the
full year; $8,068 million of full-year revenue before merger-related
deferred revenue adjustment
EBITDA of $582 million for the fourth quarter and $2,047 million for
Diluted Earnings per Share of $5.02 for the fourth quarter and $5.88
Diluted Earnings per Share of $1.40 for the fourth quarter and $4.67
billion of share repurchase completed post-merger, $369 million
completed during the fourth quarter
share repurchase authorization increased to $5.0 billion from $3.5
DANBURY, Conn. & RESEARCH TRIANGLE PARK, N.C.--(BUSINESS WIRE)--February
14, 2018--IQVIA Holdings Inc. ("IQVIA") (NYSE: IQV), a leading global
provider of information, innovative technology solutions and contract
research services focused on using data and science to help healthcare
clients find better solutions for their patients, today reported
financial results for the quarter and full-year ended December 31, 2017.
On October 3, 2016, the merger of Quintiles Transnational Holdings Inc.
and IMS Health Holdings, Inc. was completed. To aid investors and
analysts with year-over-year comparability for the merged business, we
are including company financial information that combines the
stand-alone Quintiles and IMS Health financial information for revenue
and Adjusted EBITDA as if the merger had taken place on January 1, 2016,
with conforming adjustments to the current year presentation.
Fourth-Quarter 2017 Operating Results
Revenue for the fourth quarter of $2,161 million increased 10.7 percent
on a reported basis, and 8.4 percent on a constant currency basis,
compared to the fourth quarter of 2016. Under purchase accounting rules,
a portion of IMS Health's deferred revenue, which would have otherwise
been realized as revenue in the fourth quarter of 2016, was eliminated.
Excluding this $55 million deferred revenue adjustment, revenue for the
fourth quarter increased 7.7 percent on a reported basis and 5.5 percent
on a constant currency basis.
Commercial Solutions revenue of $1,027 million grew 10.6 percent
reported and 7.8 percent at constant currency. Research & Development
Solutions revenue of $947 million grew 6.6 percent reported and 5.0
percent on a constant currency basis. Integrated Engagement Services
revenue of $187 million declined 3.3 percent reported and 4.7 percent at
Fourth-quarter 2017 Adjusted EBITDA was $582 million. GAAP net income
was $1,076 million and GAAP diluted earnings per share was $5.02. During
the fourth quarter, and as a result of the Tax Cuts and Jobs Act enacted
in 2017, the company revalued its deferred taxes at the lower U.S.
corporate tax rate, and reversed its deferred tax liability on
undistributed earnings net of the newly enacted transition tax. This
resulted in a provisional benefit of $977 million to GAAP net income and
$4.56 to GAAP diluted earnings per share. Adjusted Net Income was $300
million and Adjusted Diluted Earnings per Share was $1.40.
"We closed out the year with fourth-quarter financial results on or
above our targets, driven by strong operational execution," said Ari
Bousbib, chairman and CEO of IQVIA. "We are pleased with our progress
during our first full year as a merged company and look forward to
delivering another solid performance in 2018."
Full-Year 2017 Operating Results
Revenue of $8,060 million for the full year of 2017 increased 4.3
percent reported and 4.2 percent on a constant currency basis, compared
to the combined company results in 2016. Excluding the $55 million
deferred revenue adjustment in the fourth quarter of 2016 and the $8
million deferred revenue adjustment in the first and second quarters of
2017, revenue for the full year increased 3.7 percent on a reported
basis and 3.5 percent on a constant currency basis.
Commercial Solutions revenue of $3,638 million for the full year of 2017
increased 4.4 percent on a reported basis and 4.0 percent on a constant
currency basis, compared to the combined company results in 2016.
Commercial Solutions revenue growth was partially offset by the Encore
business, a legacy Quintiles provider business, which was divested in
Research & Development Solutions revenue of $3,647 million for the full
year of 2017 grew 4.3 percent reported and 4.4 percent on a constant
currency basis, compared to the combined company results in 2016.
Research & Development Solutions revenue growth was impacted by a
year-over-year decline in the early clinical development business, due
to a facility closing in Europe during 2016, as well as weak bookings
and high cancellations in the third quarter of 2016. Research &
Development Solutions contracted net new business totaled $4.54 billion
for the 12 months ended December 31, 2017. The last twelve months
book-to-bill ratio was 1.24 and contracted backlog was $10.54 billion at
Integrated Engagement Services revenue of $783 million for the full year
of 2017 declined 2.6 percent reported and 2.0 percent at constant
currency, compared to the combined company results in 2016.
Year-over-year comparisons for Integrated Engagement Services were
impacted by the acceleration of $9 million of revenue in the second
quarter of 2016 for the modification of a royalty-based sales force
For the full year of 2017, Adjusted EBITDA was $2,047 million. GAAP net
income was $1,309 million and GAAP diluted earnings per share was $5.88.
The Tax Cuts and Jobs Act enacted in 2017 resulted in a provisional
benefit of $977 million to GAAP net income and $4.39 to GAAP diluted
earnings per share. Adjusted Net Income was $1,039 million and Adjusted
Diluted Earnings per Share was $4.67.
As of December 31, 2017, cash and cash equivalents were $959 million and
debt was $10,225 million, resulting in net debt of $9,266 million. At
the end of the fourth quarter of 2017, IQVIA's Gross Leverage Ratio was
5.0 times, and Net Leverage Ratio was 4.5 times trailing 12-month
combined company Adjusted EBITDA.
On November 27, 2017, the company repurchased $255 million of stock from
the company's private equity sponsors. This repurchase was completed in
conjunction with an underwritten secondary public offering and was
outside of IQVIA's existing share repurchase program. The company also
repurchased $114 million of its stock in the open market, for a total
repurchase of $369 million during the fourth quarter.
On February 14, 2018, the IQVIA board authorized an increase of the
post-merger share repurchase authorization by $1.5 billion to a total of