Full Press Release Details
1st Quarter 2015 Results
billion of net new business representing a 1.31 book-to-bill ratio
constant currency service revenue growth compared to the first quarter
diluted adjusted earnings per share representing 5.9% growth compared
to the first quarter of 2014 and first quarter GAAP reported diluted
earnings per share of $0.68
full year 2015 service revenue constant currency growth guidance to
7.0% - 8.0% compared to full year 2014 and reaffirming diluted
adjusted EPS guidance of $3.02 - $3.13 per share, representing diluted
adjusted EPS growth of 12% to 16% compared to full year 2014
million expansion of existing equity repurchase program
RESEARCH TRIANGLE PARK, N.C.--(BUSINESS WIRE)--April 29, 2015--Quintiles
Transnational Holdings Inc. ("Quintiles" or the "Company") (NYSE: Q)
today reported its financial results for the quarter ended March 31,
For the three months ended March 31, 2015, the Company's service
revenues were $1.03 billion which represents growth of 2.5%, or $24.7
million including an unfavorable foreign currency impact of $59.0
million compared to the same period last year. The Company's growth in
service revenues, excluding the impact of foreign currency fluctuations
("constant currency"), was 8.4% with 29.3% growth in the Integrated
Healthcare Services segment and 1.9% growth in the Product Development
Adjusted income from operations was $148.5 million in the first quarter
of 2015, representing growth of 4.4% compared to the same period last
year. The adjusted income from operations margin was 14.4%, representing
20 basis points of expansion compared to the same period last year,
including 110 basis points from favorable currency fluctuations, offset
by a change in service revenue and segment contribution mix compared to
the same period in 2014. Adjusted net income was $91.2 million and
diluted adjusted earnings per share was $0.72 in the quarter ended March
Reported GAAP income from operations was $143.2 million, reported GAAP
net income was $86.4 million and reported GAAP diluted earnings per
share was $0.68 for the three months ended March 31, 2015.
Reconciliations of the non-GAAP measures, including adjusted income from
operations, adjusted net income and diluted adjusted earnings per share
to the corresponding GAAP measures are attached to this press release.
Net new business grew 5.6% compared to the same period last year to
$1.35 billion representing a book-to-bill ratio of 1.31 in the quarter.
At constant currency rates, net new business grew 10.5% compared to the
same period last year. The first quarter net new business contributed to
an ending backlog of $11.06 billion at March 31, 2015.
"We are pleased with our results for the first quarter," said Quintiles
Chief Executive Officer Tom Pike. "Quintiles' first-quarter service
revenue growth was 8.4% at constant currency. We delivered a greater
revenue contribution from our IHS business which experienced service
revenue growth of 29.3% at constant currency."
"As expected, our Product Development segment started the year slower;
however, we believe this segment will accelerate in the second half of
the year on the back of our more than $11 billion industry-leading
backlog," Pike continued.
The Product Development segment net new business increased 8.1% in the
quarter ended March 31, 2015 to $1.09 billion which translates into a
book-to-bill ratio of 1.45 for the quarter. At constant currency rates,
net new business grew at 11.9% compared to the same period last year.
Product Development's service revenues at constant currency grew 1.9%,
or $14.9 million during the first quarter of 2015 compared to the same
period last year. At actual foreign exchange rates, Product Development
service revenues were $749.5 million, negatively impacted by $36.2
million of unfavorable foreign currency exchange resulting in service
revenues declining 2.8% compared to the same period last year. The
constant currency revenue growth resulted from volume-related increases
in clinical solutions and services in Asia Pacific offset by a decrease
in advisory services and the negative impact of cancellations from 2014.
The impact of these cancellations is expected to mitigate over the
second half of 2015 as new projects from recent net new business wins
transition from the project start-up phase into project phases that
include higher revenue generating activities. Product Development's
income from operations margin was 20.9% for the first quarter,
representing an improvement of 10 basis points compared to the same
period last year, including 160 basis points from foreign exchange
benefits offset by a change in service revenue mix compared to the same
period in 2014, an increase in billable headcount and net compensation
costs, and investments associated with some of the Company's
productivity initiatives.
The Integrated Healthcare Services segment net new business decreased
3.5% in the quarter ended March 31, 2015 to $260 million which
translates to a book-to-bill ratio of .93. At constant currency rates,
net new business grew at 5.3% compared to the same period last year.
Integrated Healthcare Services' service revenues at constant currency
grew 29.3% or $68.8 million during the first quarter of 2015 compared to
the same period last year, including $19.4 million from the Encore
acquisition. At actual foreign exchange rates, Integrated Healthcare
Services' service revenues increased 19.6% to $280.5 million inclusive
of the negative impact of $22.8 million from unfavorable foreign
currency exchange. The constant currency revenue growth resulted from
increases in commercial solutions in Japan and North America, along with
growth in real-world and late phase research services. This growth was
partially offset by a decline in commercial solutions in Europe due to
the conclusion of an agreement to distribute pharmaceutical products in
Italy and lower commercial services. Integrated Healthcare Services'
income from operations margin was 6.5% at actual rates including the
impact of 30 basis points from unfavorable currency fluctuations. The
income from operations margin at constant currency improved 300 basis
points compared to the same period last year.
General corporate and unallocated expenses were $26.6 million during the
quarter ended March 31, 2015 compared to $27.3 million for the same
Interest expense was $25.3 million during the quarter ended March 31,
2015 compared to $24.7 million for the same period last year. Interest
expense was higher due to an increase in the average debt outstanding.
Other income, net was $2.9 million during the quarter ended March 31,
2015 compared to $4.8 million for the same period last year. Other