Business continues to grow at Quintiles (NYSE: Q), but net earnings are growing much faster.
The news ignited an immediate rally when Wall Street opened with shares jumping 6 percent to $49.99, up $2.86. During a day in which nearly double the usual amount of shares traded (1.79 million), “Q” finished the day up 3.5 percent to close at $48.76.
“As we approach the first anniversary next week of our reentry into the public markets, I’m proud of our accomplishments over the last year,” Chief Executive Officer Tom Pike told analysts in a conference call. “After a strong 2013 performance, I’m pleased to report that we’re off to a great start in 2014. We delivered strong financial results in the first quarter and continue to grow our backlog, positioning us nicely for the longer term.”
Pike noted the backlog of business for the firm is now above $10 billion for the first time in the 31-year history of the firm. Quintiles upped its financial guidance, adding to the buying momentum for shares.
The world’s global life science services provider also reported early Thursday revenues topped $1 billion for the second consecutive quarter.
Meanwhile, net income and earnings per share surge $42 million and 27 cents compared to one year ago.
Total revenues reached $1.3 billion vs. $1.23 billion in the first quarter of 2013. Service revenues were just over $1 billion vs. $927 million a year earlier.
It’s the second consecutive quarter in which service revenues topped $1 billion.
Net income, however, surged 87 percent to $90 million from $48.3 million.
Earnings per share rose to 68 cents from 41 cents, up 66 percent.
The revenue total beat Street expectations of $1.02 billion.
Thirteen analysts polled by Zacks Financial Services had predicted earnings of 56 cents per share.
Quintiles also upped its financial guidance for the year by 5 cents to $2.38-$2.52 from $2.33-$2.46, notes RTT news..
Revenue guidance also was increased some $400 million.
Overall, Quintiles also said it expects revenues for the year to be between $4.13 billion and $4.19 billion with earnings to grow between 16.7 percent and 22.9 percent to between $2.45-$2.58 per share.
“We continued our momentum from the fourth quarter of 2013 and are off to a strong start in 2014,” Pike said in a statement.
“Our Product Development segment continues to execute consistently on all fronts delivering 8.6% service revenue growth on a constant currency basis and our Integrated Healthcare Services segment returned to growth with constant currency service revenue growth of 7.9%. At the same time, we continued to execute on new business opportunities, passing another major milestone with a record $10.1 billion in backlog and strong net new business which resulted in a book-to-bill of 1.27 times service revenues.”
Shares of Quintiles, which returned to the public markets last year, had closed Wednesday at $47.13, down 45 cents.
Shares have traded between $40.10 and $55.10 since the IPO at $40 per share.
The full earnings report can be read online.