INC Research raises guidance for 2015, stock jumps 10%
The company said this year’s revenue grew across all therapeutic areas and has been particularly strong in the CNS (central nervous system), oncology and other complex therapeutic areas. Net new business awards for the quarter were $295.9m, representing a book-to-bill ratio of 1.3x, which compares with $103.4m for the same quarter in 2014.
Jamie Macdonald, CEO of INC, said in a statement: "On the customer front, we continue to see strong repeat business while winning new awards from new customers with novel molecules exploring innovative approaches for patients. Our launch during the quarter of the CRO industry's first Site Advocacy Group has been highly successful with positive customer feedback, holding significant potential to improve the way in which clinical trials are conducted in the future.”
More specifically, Macdonald told investors Thursday that INC has successfully completed the conversion of one of the largest customers in Q2 – presumably Astellas – into a new three-year full-service agreement.
INC is further expanding its business into Phase I oncology work, where it’s built a dedicated group of experts to support this growing specialty area, he added. “The oncology market is going to continue to be strong, I think that’s clear,” he told investment analysts in the Q&A.
“We are also improving the diversity of our customer base, with our top 5 customers representing only 34% of revenue” in Q2, down from 40% from the same quarter last year, Macdonald said.
As far as the rest of the year, INC has raised its expected net service revenue range from $880m-$905m to $900m-$910m. GAAP diluted EPS and adjusted diluted EPS were also raised.
