Full Press Release Details
Reports Third Quarter 2013 Results
business wins over $1.3 billion, up 29% compared to third quarter
2012; Backlog of $9.6 billion at the end of third quarter 2013
quarter diluted adjusted EPS of $0.54 and adjusted net income of $71.9
million, up 20.0% and 36.7%, respectively, compared to third quarter
quarter GAAP reported diluted EPS of $0.50 and GAAP reported net
income of $66.8 million, up 13.6% and 28.2%, respectively, compared to
full year 2013 adjusted diluted EPS guidance to $2.03 - $2.09 per share
authorized $125 million equity repurchase program
RESEARCH TRIANGLE PARK, N.C.--(BUSINESS WIRE)--October 31,
2013--Quintiles Transnational Holdings Inc. ("Quintiles" or the
"Company") (NYSE:Q) today reported its financial results for the quarter
ended September 30, 2013.
For the three months ended September 30, 2013, the Company's growth in
service revenues, excluding the impact of foreign currency fluctuations
("constant currency revenue growth"), was 4.0%, or $36.9 million
compared to the same period last year. At actual foreign exchange rates,
service revenues grew $19.1 million or 2.1% to $932.7 million compared
to the same period last year including an unfavorable foreign currency
impact of 1.9%, or $17.8 million. Constant currency revenue growth
resulted from growth in the Product Development segment partially offset
by a decrease in the Integrated Healthcare Services segment.
Adjusted income from operations was $132.5 million in the third quarter
of 2013, representing growth of 20.4% compared to the prior year. The
adjusted income from operations margin was 14.2%, representing 220 basis
points of expansion compared to the same period last year. Adjusted net
income was $71.9 million in the third quarter of 2013, representing
growth of 36.7% compared to the same period last year. Diluted adjusted
earnings per share was $0.54 in the quarter ended September 30, 2013,
representing growth of 20.0% compared to the same period last year.
Reported GAAP income from operations was $125.3 million, reported GAAP
net income was $66.8 million and reported GAAP diluted earnings per
share was $0.50 for the three months ended September 30, 2013.
Reconciliations of the non-GAAP measures 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 29% and 20% in the three and nine months ended
September 30, 2013 to $1.34 billion and $3.60 billion, respectively
compared to the same periods last year. The third quarter of 2013 was
the fifth sequential quarter of $1.0 billion or more in net new business
which has contributed to an ending backlog at September 30, 2013 of $9.6
billion. The book to bill ratio, which represents net new business
divided by service revenues during the respective period, was 1.44 for
the third quarter 2013 and 1.28 for the nine month period ended
"We are pleased with our financial results for the third quarter. We
continue to gain market share as reflected in the strength of our net
new business and the largest backlog in the industry," said Tom Pike,
Quintiles' chief executive officer. "It is an indication that our
strategy and solutions are relevant to our customers as they address the
opportunities and challenges of the changing healthcare landscape. We
have further differentiated our service offerings with the acquisition
of Novella Clinical in the third quarter, strengthening our capabilities
focused on emerging biopharma, oncology and medical devices."
"We have delivered income from operations margin expansion sequentially
and year over year within our Product Development segment while
improving the performance of our Integrated Healthcare Services segment
as demonstrated by the strong new business wins during the quarter and
continued income from operations margin improvement compared to the
first quarter of 2013. Our ending cash position improved with the strong
cash generated from operations during the quarter. We continue to invest
in growth areas of our business to bolster our scientific, therapeutic
and data analytics expertise and we are confident that our focus of
delivering value to customers translates into value creation for our
The Product Development segment net new business grew 9% for the current
quarter and 18% for the nine months ended September 30, 2013 compared to
the same periods last year which translates into a book to bill of 1.21
for the third quarter and 1.31 for the nine month period ended September
30, 2013. Product Development's constant currency revenue growth was
6.3%, or $42.4 million during the third quarter of 2013 compared to the
same period last year. At actual foreign exchange rates, Product
Development's service revenues grew 5.5% compared to the same period
last year to $714.2 million. The constant currency revenue growth
resulted from a volume related increase in core clinical services and
global labs partially offset by the continuing wind down of a few large
projects. Product Development's income from operations margin was 19.7%
for the third quarter, improving 180 basis points compared to the same
The Integrated Healthcare Services segment net new business grew 93% for
the current quarter and 30% for the nine month period ended September
30, 2013 compared to the same periods last year which translates into a
book to bill of 2.19 for the third quarter and 1.20 for the nine months
period ended September 30, 2013. On a constant currency basis,
Integrated Healthcare Services' service revenues declined 2.3% or $5.5
million during the third quarter of 2013 compared to the same period
last year primarily due to lower new business from the first half of
2013 and negative scope modifications and cancellations. At actual
foreign exchange rates, Integrated Healthcare Services' service revenues
declined 7.6%, or $17.9 million, compared to the same period last year
to $218.5 million of which $12.4 million or 5.3% was due to unfavorable
foreign currency fluctuations. Integrated Healthcare Services' income
from operations margin was 5.3% for the third quarter, improving 10
basis points compared to the same period last year.
General corporate and unallocated expenses were $19.8 million during the
third quarter compared to $24.9 million for the same period last year.
Interest expense was $28.8 million during the third quarter compared to
$33.5 million for the same period last year.
The GAAP effective income tax rate was 29.1% for the third quarter of
2013 compared to 29.7% for the same period in 2012. The effective income
tax rates for the three and nine month periods ended September 30, 2013
were positively impacted by the Company asserting in the second quarter
of 2013 that the undistributed earnings of most of the Company's foreign