Full Press Release Details
Reports First Quarter 2014 Results
$1.0 billion of service revenues representing 8.4% growth; Integrated
Healthcare Services segment grew service revenues by 6.0% in the
business wins of $1.27 billion representing a book-to-bill ratio of
quarter diluted adjusted EPS increased 39% to $0.68 and adjusted net
income increased 58% to $90.9 million compared to the first quarter of
quarter GAAP reported diluted EPS increased 66% to $0.68 and GAAP
reported net income increased 87% to $90.2 million compared to the
first quarter of 2013
full year 2014 service revenue guidance to $4.13 billion - $4.19
billion and increased diluted adjusted EPS guidance to $2.45 - $2.58
per share, representing growth of 16.7% to 22.9%
RESEARCH TRIANGLE PARK, N.C.--(BUSINESS WIRE)--May 1, 2014--Quintiles
Transnational Holdings Inc. ("Quintiles" or the "Company") (NYSE: Q)
today reported its financial results for the first quarter ended March
For the three months ended March 31, 2014, the Company's service
revenues increased 8.4%, or $77.9 million compared to the same period
last year at actual foreign exchange rates. The Company's growth in
service revenues, excluding the impact of foreign currency fluctuations
("constant currency"), was also 8.4% with 8.6% growth in the Product
Development segment and 7.9% growth in the Integrated Healthcare
Adjusted income from operations was $142.3 million in the first quarter
of 2014, representing growth of 20.2% compared to the prior year
quarter. The adjusted income from operations margin was 14.2%,
representing 140 basis points of expansion compared to the same period
last year. Adjusted net income was $90.9 million in the first quarter of
2014, representing growth of 57.8% compared to the same period last
year. Diluted adjusted earnings per share was $0.68 in the quarter ended
March 31, 2014, representing growth of 38.8% compared to the same period
last year. Non-operating items contributed $0.04 per share in the
Reported GAAP income from operations was $141.3 million, GAAP net income
was $90.2 million and GAAP diluted earnings per share was $0.68 for the
three months ended March 31, 2014. 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 of $1.27 billion representing a book-to-bill ratio of
1.27 was recorded in the quarter ended March 31, 2014. This net new
business contributed to an ending backlog of $10.1 billion at March 31,
"We continued our momentum from the fourth quarter of 2013 and are off
to a strong start in 2014," said Tom Pike, chief executive officer. "Our
Product Development segment continues to execute consistently on all
fronts delivering 8.6% service revenue growth on a constant currency
basis and our Integrated Healthcare Services segment returned to growth
with constant currency service revenue growth of 7.9%. At the same time,
we continued to execute on new business opportunities, passing another
major milestone with a record $10.1 billion in backlog and strong net
new business which resulted in a book-to-bill of 1.27 times service
"We were recently named, in third-party research, as the preferred
provider among small, mid-size and large biopharmaceutical customers for
Phase II and III research for the second year in a row," Pike continued.
"We were also honored as the Best CRO in Asia' for the third
consecutive time by the BioPharma Asia Industry. We believe these
acknowledgements support the value proposition we bring to our customers
as we help them improve their probability of success thereby
contributing to the improvement of the healthcare landscape."
The Product Development segment net new business totaled $1.01 billion
in the quarter ended March 31, 2014 which translates into a book-to-bill
ratio of 1.30. Product Development's constant currency service revenue
growth was 8.6%, or $60.8 million during the first quarter of 2014
compared to the same period last year. At actual foreign exchange rates,
Product Development's service revenues grew 9.1% compared to the same
period last year to $770.8 million. The constant currency service
revenue growth resulted from a volume-related increase in core clinical
services in North America, growth in clinical trial support services,
volume increases in global labs and the Novella acquisition in 2013,
partially offset by the conclusion of a large clinical solutions project
which was delivered throughout 2013. Product Development's income from
operations margin was 20.8% for the first quarter, representing an
improvement of 200 basis points compared to the same period last year,
attributed to operations and productivity improvements in clinical
services and 130 basis points from favorable currency fluctuations.
The Integrated Healthcare Services segment net new business totaled $269
million which translates into a book-to-bill ratio of 1.15 for the
quarter ended March 31, 2014. On a constant currency basis, Integrated
Healthcare Services' service revenues increased 7.9% during the first
quarter of 2014 compared to the same period last year, primarily due to
increases in Japan and North America as well as growth in real-world and
late phase research services. At actual foreign exchange rates,
Integrated Healthcare Services' service revenues increased 6.0%, or
$13.4 million, compared to the same period last year to $234.5 million
including a $4.2 million or 1.9% unfavorable foreign currency impact.
Integrated Healthcare Services' income from operations margin was 3.8%
for the first quarter.
General corporate and unallocated expenses were $27.3 million during the
quarter ended March 31, 2014 compared to $21.8 million for the same
period last year. General corporate and unallocated expenses were higher
compared to the same period of 2013 primarily due to increased
share-based compensation expense and an increase in marketing related
Interest expense was $24.7 million during the quarter ended March 31,
2014 compared to $36.0 million for the same period last year. Interest
expense was lower than the same period in 2013 due to a decrease in the
average debt outstanding and a lower interest rate.
Other income, net was $4.8 million during the quarter ended March 31,
2014 compared to $2.4 million for the same period last year. Other
income, net was higher than the same period in 2013 primarily due to a
$5.0 million gain from the sale of marketable securities.
The GAAP effective income tax rate was 30.5% for the quarter ended March
31, 2014 compared to 39.2% for the same period in 2013. The effective
income tax rate for the three months ended March 31, 2014 was positively