Clinical trials group Icon has increased its revenue guidance for the year following a 38 per cent year-on-year increase in third quarter net revenues to $166.9 million (€117.18 million).
The Nasdaq-listed firm said it now expects its revenue for 2007 to now be in the region of $615 - $625 million and earnings per share to be $1.82 - $1.85.
Net income for the quarter was $14.5 million or 49 cents per share on a diluted basis, compared with $10.1 million or 35 cents per share a year ago.
"We are delighted with Icon's third quarter performance," said Dr John Climax, chairman of Icon. "Revenue growth was very strong and operating margins continued to expand."
Operating margins for the third quarter to the end of September last were 11.2 per cent compared to 10.4 per cent a year ago. Net new business bookings, a key metric for companies operating in the pharmaceutical trails business, came in at $230 million, producing a book-to-bill ratio of 1.4. As a result, Dr Climax said, Icon has "strong confidence in the outlook for the remainder of the year" and is upgrading its guidance for the full year.
Icon generated cash from operating activities of $0.6 million and capital expenditure was $19.3 million. Days' sales outstanding, comprising accounts receivable and unbilled revenue less payments on account, were 65 days at the end of the quarter, up from 57 days at September 30th, 2006.
Goodbody Stockbrokers analyst Ian Hunter said Icon's share price has had "a very strong run" and noted the share price was up 27 per cent since mid-August. He reiterated his Add rating on the stock yesterday but said it would need another strong quarter before he upgraded it to Buy.
