IQVIA Reports Fourth-Quarter and Full-Year 2020 Results Raises Full-Year 2021 Guidance

Rhea-AI Summary

IQVIA Holdings reported a strong fourth quarter for 2020, with revenue of $3,298 million, representing a 13.9% increase year-over-year. Technology & Analytics Solutions (TAS) grew 17.4%, while Research & Development Solutions (R&DS) increased 14.5%. However, Contract Sales & Medical Solutions (CSMS) revenue declined by 10%. The R&DS contracted backlog rose 18.5% to $22.6 billion. The company achieved an adjusted EBITDA of $735 million and raised its 2021 financial guidance, projecting revenues between $12,550 million and $12,900 million.

Positive

• Fourth-quarter revenue increased 13.9% year-over-year.
• Adjusted EBITDA for Q4 was $735 million, up 14.5% from Q4 2019.
• R&DS contracted backlog grew 18.5% year-over-year to $22.6 billion.
• Raised 2021 revenue guidance to $12,550 million - $12,900 million.

Negative

• CSMS revenue fell by 10% in Q4.
• R&DS revenue decreased by 0.5% for the full year 2020.

IQVIA Holdings Inc. (“IQVIA”) (NYSE:IQV), a leading global provider of advanced analytics, technology solutions, and clinical research services to the life sciences industry, today reported financial results for the quarter ended December 31, 2020.

Fourth-Quarter 2020 Operating Results
Revenue for the fourth quarter of $3,298 million increased 13.9 percent on a reported basis and 12.2 percent at constant currency, compared to the fourth quarter of 2019. Technology & Analytics Solutions (TAS) revenue of $1,425 million grew 17.4 percent on a reported basis and 15.1 percent at constant currency. Research & Development Solutions (R&DS) revenue of $1,684 million grew 14.5 percent on a reported basis and 13.2 percent at constant currency. Excluding the impact of pass throughs, R&DS revenue increased 12.3 percent year-over-year on a reported basis. Contract Sales & Medical Solutions (CSMS) revenue of $189 million was lower by 10.0 percent on a reported basis and by 11.9 percent at constant currency.

R&DS contracted backlog, including reimbursed expenses, grew 18.5 percent year-over-year to $22.6 billion at December 31, 2020. The company expects approximately $5.9 billion of this backlog to convert to revenue in the next twelve months, representing growth of 13.5 percent compared to December 31, 2019. The fourth quarter contracted net book-to-bill ratio was 1.41x including reimbursed expenses and 1.42x excluding reimbursed expenses. For the year ended December 31, 2020, the contracted net book-to-bill ratio was 1.53x including reimbursed expenses and 1.44x excluding reimbursed expenses.

Fourth-quarter 2020 Adjusted EBITDA was $735 million, up 14.5 percent compared to the fourth quarter of 2019. GAAP net income was $119 million, and GAAP diluted earnings per share was $0.61. Adjusted Net Income was $411 million and Adjusted Diluted Earnings per Share was $2.11, up 21.3 percent compared to the fourth quarter of 2019.

“We closed 2020 with a strong quarter, delivering double-digit growth across all key financial metrics versus what had been a very strong fourth quarter in 2019, once again exceeding our financial targets,” said Ari Bousbib, chairman and CEO of IQVIA. “As expected, R&DS recovered sharply and TAS continued to build on its strong momentum, with both segments reporting mid-teens revenue growth in the quarter. The key markets we serve remain robust and our new business wins in these markets continue to accelerate. As a result of this performance, and the solid momentum we are seeing, we are raising our 2021 financial guidance.”

Full-Year 2020 Operating Results
Revenue of $11,359 million for the full year of 2020 grew 2.4 percent on a reported basis and 2.3 percent at constant currency, compared to 2019. TAS revenue of $4,858 million increased 8.3 percent on a reported basis and 8.1 percent at constant currency. R&DS revenue of $5,760 million was lower by 0.5 percent on a reported basis and by 0.7 percent at constant currency. Excluding the impact of pass throughs, R&DS revenue grew 2.2 percent year-over-year on a reported basis. CSMS revenue of $741 million was lower by 9.0 percent on a reported basis and by 9.2 percent at constant currency.

Adjusted EBITDA for the full year of 2020 was $2,384 million. GAAP net income was $279 million and GAAP diluted earnings per share was $1.43. Adjusted Net Income was $1,252 million and Adjusted Diluted Earnings per Share was $6.42.

Financial Position
As of December 31, 2020, cash and cash equivalents were $1,814 million and debt was $12,533 million, resulting in net debt of $10,719 million. At year-end 2020, IQVIA’s Net Leverage Ratio was 4.5x trailing twelve month Adjusted EBITDA. Free Cash Flow for the fourth quarter was $574 million, bringing full-year Free Cash Flow to $1,343 million.

Share Repurchase
During the fourth quarter of 2020, the company repurchased $102 million of its common stock, resulting in full year share repurchases of $423 million. IQVIA had $918 million of share repurchase authorization remaining as of December 31, 2020.

Full-Year 2021 Guidance
For the full year of 2021, the company is raising its guidance ranges as follows:

($ in millions, except per share data)		Updated	Prior(1)
Revenue		$12,550 - $12,900	$12,300 - $12,600
Adjusted EBITDA		$2,760 - $2,840	$2,725 - $2,800
Adjusted Diluted EPS		$7.77 - $8.08	$7.65 - $7.95
(1) Provided on Q3 2

FAQ

What were IQVIA's fourth-quarter 2020 revenue and growth rate?

IQVIA's fourth-quarter 2020 revenue was $3,298 million, growing by 13.9% year-over-year.

How much did IQVIA raise its 2021 revenue guidance?

IQVIA raised its 2021 revenue guidance to between $12,550 million and $12,900 million.

What was the adjusted EBITDA for IQVIA in the fourth quarter of 2020?

The adjusted EBITDA for IQVIA in the fourth quarter of 2020 was $735 million.

What was the contracted backlog for R&DS as of December 31, 2020?

The contracted backlog for R&DS increased by 18.5% year-over-year to $22.6 billion.

What was the decline in CSMS revenue for IQVIA in the fourth quarter of 2020?

CSMS revenue declined by 10.0% in the fourth quarter of 2020.