Irish clinical research company Icon increased revenues 38 per cent to $630.7 million (€425.4 million) last year, which resulted in a 31 per cent increase in net profit to $55.9 million.

The strong full-year results were driven by a fourth-quarter performance that exceeded analysts' expectations. Net income for the three months to the end of December came in at $15.8 million on revenues of $181 million, up 40 per cent from the previous year. Icon had a record net new business wins of $344 million during the quarter.

Net of debt, Icon had cash and near-term investments of $23.8 million at year-end.

"2007 has been another outstanding year for Icon," said chairman Dr John Climax. "Revenue growth continued to be strong and operating margins expanded. Record net bookings of $344 million in the fourth quarter led to bookings for the full year of over $1 billion, another major milestone for Icon. As a consequence, we have a record backlog of $1.3 billion, which gives us confidence as we enter our new fiscal year."

Management said revenues are expected to grow by 22 per cent in 2008.

Merrion Landsbanki analyst Sam Farthing upgraded Icon to a "buy" rating. In a research note, he said Icon's guidance "looks conservative" and he is forecasting earnings to grow by over 26 per cent this year.

"The pharma companies are looking to outsource more to reduce their cost base," said Ian Hunter, an analyst at Goodbody Stockbrokers. "There's quite a lot of material in the pipeline as they look for new compounds, but also to extend the life of existing compounds. That all generates clinical trial work."

Icon is one of four or five large companies that can provide the "scale and global resources" that the industry is seeking, Mr Hunter said.

Icon currently has about 5,600 employees operating from 68 locations in 36 countries.

(Additional reporting: Bloomberg)