ICON Public Company (ICLR) Q4 2023 earnings summary

Executive summary

• FY23 revenue rose 4.9% to $8,120.2m; adjusted EBITDA increased 14.5% to $1,694.1m at a 20.9% margin, and adjusted diluted EPS rose 8.9% to $12.79.

• Q4 revenue was $2,066.2m, up 5.3% reported; adjusted EBITDA was $448.2m at a 21.7% margin, and adjusted diluted EPS was $3.46, up 10.5%.

• FY net business wins were $9,946m, book-to-bill was 1.22, and closing backlog reached $22.8bn, up 10.0% YoY.

Financial highlights

• FY GAAP net income was $612.3m ($7.40 diluted EPS), versus adjusted net income of $1,058.2m ($12.79 adjusted diluted EPS).

• Q4 GAAP net income was $216.4m ($2.60 diluted EPS), versus adjusted net income of $287.5m ($3.46 adjusted diluted EPS).

• Revenue grew 4.9% reported and 4.6% at constant currency for FY23; Q4 growth was 5.3% reported and 4.1% at constant currency.

• Adjusted net income effective tax rate was 15.2% in Q4 and 15.5% for FY23.

Outlook and guidance

• FY24 revenue guidance is $8.4bn–$8.8bn, growth of 3.4%–8.4%; adjusted diluted EPS guidance is $14.50–$15.30, growth of 13.4%–19.6%.

• Guidance assumes ~50 bps adjusted EBITDA margin expansion, ~$1.1bn free cash flow, $200m–$230m interest expense, and $150m–$200m capital expenditure.

• FY24 guidance assumes a 16.5% effective tax rate; adjusted EPS guidance is non-GAAP and excludes share repurchases and additional M&A.