ICLR ICON PLC

ICON (NASDAQ:ICLR): Highlights - Second Quarter Fiscal 2006, ending November 30, 2005. -- Record $140 million of net new business ($165 million gross) awarded to ICON during the quarter. -- Diluted earnings per share increased by 20% for the second quarter to 49 cents compared to 41 cents in same quarter last year. Year-to-date diluted earnings per share was 94 cents compared to 93 cents for the comparable period last year. -- Income from operations increased by 29% over the comparable period last year to $9.0 million and increased by 5% for the six months to November 30, 2006. -- Second quarter net revenues increased 11% over the same period last year to $88.1 million and increased 10% on a year-to-date basis. ICON plc (NASDAQ:ICLR), a global contract clinical research organisation, which has approximately 3,000 employees providing services to the pharmaceutical, biotech and medical device industries from 39 locations in 25 countries worldwide, today reported the financial results for its second quarter ended November 30, 2005. Net revenues for the quarter were $88.1 million, representing an 11% increase over net revenues of $79.5 million for the same quarter last year. Income from operations for the quarter was $9.0 million, which represents an increase of 29% from the $7.0 million reported for the second quarter last year. Operating margin for the quarter was 10.2% compared with 8.8% for the equivalent period last year. Net income for the quarter was $7.0 million or 49 cents per share, on a diluted basis, compared with $5.8 million or 41 cents per share for the second quarter last year, an increase of 20%. In the six months to November 30, 2005, net revenues were $174.0 million, representing a 10% increase over net revenues of $157.8 million reported for the first six months of last year. Income from operations for the six months to November 30, 2005 was $17.4 million, representing an increase of 5% from the $16.5 million reported for the same period last year. Operating margin for the six months to November 30, 2005 was 10.0%, compared with 10.4% in the same period last year. Net income was $13.3 million or 94 cents per share, on a diluted basis compared with $13.1 million or 93 cents per share reported for the same period last year. Days sales outstanding, comprising accounts receivable and unbilled revenue less payments on account, were 67 days at November 30, 2005 compared with 70 days at August 31, 2005. For the quarter ended November 30, 2005, cash generated from operations was $11.7 million, and capital expenditure was $7.8 million. For the six months to November 30, 2005, cash generated from operations was $14.5 million, capital expenditure was $11.0 million and net payments of $3.4 million were made in relation to prior year acquisitions. As a result of these factors the company's net cash, short-term debt and short-term investments were $79.2 million at November 30, 2005, compared to $75.4 million at August 31, 2005 and $78.4 million at May 31, 2005. "We are very pleased with our performance in the second quarter", commented Chairman, Dr John Climax. "Revenue growth accelerated, operating margin continued to improve and we booked record levels of new business, continuing the momentum built up over the past few quarters." Commenting on the outlook, Dr Climax said "At the end of November, our total backlog was $633 million and business flows continued to be good. Based on this strong position, we expect that our net revenues for the 12 months ended December 31, 2006 will be between $380 - $400 million and we estimate that approximately $296 million, or 76% of these forecasts are currently in booked and awarded business. We will provide more detailed guidance on our conference call to be held today". The company will hold its second quarter conference call today, January 10, 2006 at 8:00 EST (13:00 GMT / 14:00 CET). This call and linked slide presentation can be accessed live from our website at http://www.iconclinical.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 "shareholders services". 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. The financial information presented herein has been prepared in accordance with U.S. GAAP. -0- *T ICON plc Consolidated Income Statements (Unaudited) Three and Six Months ended November 30, 2005 and 2004 (Dollars, in thousands, except share and per share data) Three Months Ended Six Months Ended November November November November 30, 30, 30, 30, 2005 2004 2005 2004 Gross Revenue 120,344 117,068 235,696 234,263 Subcontractor costs 32,272 37,573 61,703 76,429 ----------- ----------- ----------- ----------- Net Revenue 88,072 79,495 173,993 157,834 Costs and expenses Direct costs 48,721 43,671 96,031 86,124 Selling, general and administrative 26,824 25,520 53,633 48,859 Depreciation and amortization 3,509 3,296 6,943 6,358 ----------- ----------- ----------- ----------- Total costs and expenses 79,054 72,487 156,607 141,341 Income from operations 9,018 7,008 17,386 16,493 Interest income (net) 603 179 1,018 343 ----------- ----------- ----------- ----------- Income before provision of income taxes 9,621 7,187 18,404 16,836 Provision for income taxes 2,618 1,310 5,077 3,632 Minority Interest 50 58 (9) 80 ----------- ----------- ----------- ----------- Net income 6,953 5,819 13,336 13,124 =========== =========== =========== =========== Net income per ordinary share Basic $0.50 $0.42 $0.95 $0.95 ----------- ----------- ----------- ----------- Diluted $0.49 $0.41 $0.94 $0.93 ----------- ----------- ----------- ----------- Weighted average number of ordinary shares Basic 14,005,454 13,847,689 14,027,564 13,839,857 Diluted 14,261,734 14,067,079 14,234,326 14,088,030 *T -0- *T ICON plc Summary Balance Sheet Data November 30, 2005 and May 31, 2005 (Dollars, in thousands) November 30, May 31, 2005 2005 (unaudited) (audited) Cash and short-term investments 82,242 78,375 Short-term debt (3,000) - Net cash 79,242 78,375 Accounts receivable 63,727 80,486 Unbilled revenue 75,589 56,762 Payments on account (50,926) (52,583) Total 88,390 84,665 Working Capital 133,406 125,288 Total assets 354,872 347,553 Shareholder's equity 241,959 233,066 *T