Clinical trials group Icon has reported a 46 per cent increase in fourth-quarter net revenue boosted by new business wins and a strong backlog of orders. The shares jumped 5.5 per cent.
The Dublin-based company said yesterday that net revenue for the fourth-quarter was $129 million (€99 million), bringing the total for the full year to $455.6 million - a 33 per cent increase over 2005. As a result of a change to the group's financial year, the comparative fourth quarter for 2005 is based on the three months to the end of November.
Net income for the fourth quarter was $11.4 million. When adjusted to take account of stock compensation under US accounting regulations, net income was $12.4 million, up from $7 million.
Full-year net income, adjusted for stock compensation and a one-time charge relating to the impairment of goodwill, increased 74 per cent, to $42.4 million.
Chief executive Peter Gray welcomed the numbers, saying the highlight of the year had been the "very strong" growth seen across the whole business.
Icon, which carries out clinical trials on behalf of large pharmaceutical companies and small biotechnology groups, is benefiting as large multinationals seek to reduce their cost base by outsourcing trials. The group, which works with most of the world's largest drugmakers, has also won new business from small biotech start-ups that don't have the facilities to carry out their own tests.
During the year, the clinical division improved its margins to 12.4 per cent from 11.9 per cent.
In addition, Icon also operates a clinical labs business which analyses the results of clinical trials from around the world.
During 2006, the company successfully turned around the performance of this business. Clinical Labs recorded a profit of $1.3 million in 2006, compared with a loss of $6.6 million in 2005.
Mr Gray said the company has a record backlog of business worth $872 million, which gives a very positive outlook for 2007.
He said much of this backlog relates to contracts with pharmaceutical groups to carry out trials over a three or four-year period.
The results, which came in ahead of analysts' expectations, helped push Icon's shares in Dublin up €1.66 to close at €32.
