Cover
Cover | 9 Months Ended |
Sep. 30, 2021 | |
Cover [Abstract] | |
Document type | 6-K |
Document fiscal year focus | 2021 |
Entity registrant name | ICON plc |
Amendment flag | false |
Document fiscal period focus | Q3 |
Entity central index key | 0001060955 |
Current fiscal year end date | --12-31 |
Document period end date | Sep. 30, 2021 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Current Assets: | ||
Cash and cash equivalents | $ 1,008,524 | $ 840,305 |
Available for sale investments | 1,712 | 1,729 |
Accounts receivable, net of allowance for credit losses | 1,338,326 | 715,271 |
Unbilled revenue | 550,692 | 428,684 |
Other receivables | 60,376 | 35,394 |
Prepayments and other current assets | 131,554 | 53,477 |
Income taxes receivable | 38,484 | 28,118 |
Total current assets | 3,129,668 | 2,102,978 |
Other Assets: | ||
Property, plant and equipment, net | 319,457 | 174,343 |
Goodwill | 8,935,212 | 936,257 |
Operating right-of-use assets | 238,107 | 84,561 |
Other non-current assets | 57,637 | 20,773 |
Non-current income taxes receivable | 16,119 | 17,230 |
Non-current deferred tax asset | 117,313 | 12,705 |
Equity method investments | 3,062 | 4,534 |
Investments in equity-long term | 22,758 | 15,765 |
Intangible assets, net | 4,815,184 | 66,460 |
Total Assets | 17,654,517 | 3,435,606 |
Current Liabilities: | ||
Accounts payable | 62,576 | 51,113 |
Unearned revenue | 1,349,000 | 660,883 |
Other liabilities | 794,879 | 399,769 |
Income taxes payable | 39,614 | 12,178 |
Current bank credit lines and loan facilities | 55,150 | 0 |
Total current liabilities | 2,301,219 | 1,123,943 |
Other Liabilities: | ||
Non-current bank credit lines and loan facilities | 5,872,720 | 348,477 |
Non-current operating lease liabilities | 190,912 | 60,801 |
Non-current other liabilities | 73,917 | 26,366 |
Non-current government grants | 760 | 838 |
Non-current income taxes payable | 18,868 | 14,539 |
Non-current deferred tax liability | 1,227,535 | 10,406 |
Commitments and contingencies | 0 | 0 |
Total Liabilities | 9,685,931 | 1,585,370 |
Shareholders' Equity: | ||
Ordinary shares, par value 6 euro cents per share; 100,000,000 shares authorized, 52,958,063 shares issued and outstanding at June 30, 2021 and 52,788,093 shares issued and outstanding at December 31, 2020 | 6,629 | 4,580 |
Additional paid-in capital | 6,700,407 | 617,104 |
Other undenominated capital | 1,134 | 1,134 |
Accumulated other comprehensive loss | (79,196) | (35,477) |
Retained earnings | 1,339,612 | 1,262,895 |
Total Shareholders' Equity | 7,968,586 | 1,850,236 |
Total Liabilities and Shareholders' Equity | $ 17,654,517 | $ 3,435,606 |
Common Stock, Shares, Issued | 81,397,821 | 52,788,093 |
Ordinary shares, shares outstanding (in shares) | 81,397,821 | 52,788,093 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - € / shares | Sep. 30, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Ordinary shares, par value (in EUR cents per share) | € 0.06 | € 0.06 |
Ordinary shares, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Ordinary shares, shares issued (in shares) | 81,397,821 | 52,788,093 |
Ordinary shares, shares outstanding (in shares) | 81,397,821 | 52,788,093 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Statement [Abstract] | ||||
Revenue | $ 1,866,352 | $ 701,729 | $ 3,595,705 | $ 2,037,059 |
Costs and expenses: | ||||
Direct costs (excluding depreciation and amortization) | 1,357,942 | 493,410 | 2,615,309 | 1,444,536 |
Selling, general and administrative expense | 206,713 | 82,715 | 382,614 | 254,309 |
Depreciation and amortization | 140,636 | 16,801 | 175,317 | 48,981 |
Transaction and integration-related expenses | 149,791 | 402 | 182,309 | (497) |
Restructuring | 6,162 | 0 | 6,162 | 18,089 |
Total costs and expenses | 1,861,244 | 593,328 | 3,361,711 | 1,765,418 |
Income from operations | 5,108 | 108,401 | 233,994 | 271,641 |
Interest income | 53 | 268 | 496 | 2,518 |
Interest expense | (102,306) | (3,239) | (129,584) | (9,640) |
(Loss) income before provision for income taxes | (97,145) | 105,430 | 104,906 | 264,519 |
Benefit arising (provision) for income taxes | 3,563 | (13,706) | (26,718) | (32,706) |
(Loss) income before share of earnings from equity method investments | (93,582) | 91,724 | 78,188 | 231,813 |
Share of equity method investments | (688) | (83) | (1,471) | (83) |
Net income | (94,270) | 91,641 | 76,717 | 231,730 |
Net income attributable to noncontrolling interest | 0 | 0 | 0 | (633) |
Net (loss) income attributable to the Group | $ (94,270) | $ 91,641 | $ 76,717 | $ 231,097 |
Net (loss) income per Ordinary Share attributable to the Group (note 14): | ||||
Basic (USD per share) | $ (1.17) | $ 1.74 | $ 1.23 | $ 4.28 |
Diluted (USD per share) | $ (1.17) | $ 1.72 | $ 1.22 | $ 4.25 |
Weighted average number of Ordinary Shares outstanding (note 14): | ||||
Basic (in shares) | 80,771,397 | 52,737,299 | 62,264,851 | 52,885,252 |
Diluted (in shares) | 80,771,397 | 53,194,327 | 63,095,857 | 53,283,680 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Statement) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Comprehensive (loss) income: | ||||
Net (loss)/income attributable to the Group | $ (94,270) | $ 91,641 | $ 76,717 | $ 231,097 |
Currency translation adjustment | (35,300) | 24,004 | (44,209) | 12,176 |
Currency impact of long term funding (net of tax) | (162) | (297) | (401) | (1,299) |
Transfer to realized capital gain | 0 | 0 | 0 | (232) |
Amortization of interest rate hedge | 0 | (243) | 0 | (725) |
Write off of loss on interest rate hedge | 0 | (145) | 113 | (905) |
Write off of loss on interest rate hedge | 0 | (77) | 778 | 306 |
Total comprehensive (loss) income attributable to the group | $ (129,732) | $ 114,883 | $ 32,998 | $ 240,418 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED) - USD ($) $ in Thousands | Total | Ordinary Shares | Additional Paid-in Capital | Other Undenominated Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Redeemable Noncontrolling Interest |
Beginning balance (in shares) at Dec. 31, 2019 | 53,622,206 | ||||||
Beginning balance at Dec. 31, 2019 | $ 1,618,055 | $ 4,635 | $ 577,961 | $ 1,052 | $ (75,819) | $ 1,110,226 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | 91,696 | 91,696 | |||||
Exercise of share options (in shares) | 31,964 | ||||||
Exercise of share options | 861 | $ 2 | 859 | ||||
Issue of restricted share units (in shares) | 89,799 | ||||||
Issue of restricted share units | 6 | $ 6 | |||||
Non-cash stock compensation expense | 6,035 | 6,035 | |||||
Share issuance costs | (3) | (3) | |||||
Share repurchase program (in shares) | (1,235,218) | ||||||
Share repurchase program | (175,000) | $ (82) | 82 | (175,000) | |||
Share repurchase costs | (140) | (140) | |||||
Other comprehensive income, net of tax | (23,136) | (23,136) | |||||
Noncontrolling interest redemption adjustment | (4,522) | (4,522) | $ 4,522 | ||||
Ending balance (in shares) at Mar. 31, 2020 | 52,508,751 | ||||||
Ending balance at Mar. 31, 2020 | 1,513,852 | $ 4,561 | 584,852 | 1,134 | (98,955) | 1,022,260 | |
Beginning balance at Dec. 31, 2019 | 39,510 | ||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||||
Net income | 633 | ||||||
Noncontrolling interest redemption adjustment | (4,522) | (4,522) | 4,522 | ||||
Exercise of call option on noncontrolling interest | (44,665) | ||||||
Ending balance at Mar. 31, 2020 | 0 | ||||||
Beginning balance (in shares) at Dec. 31, 2019 | 53,622,206 | ||||||
Beginning balance at Dec. 31, 2019 | 1,618,055 | $ 4,635 | 577,961 | 1,052 | (75,819) | 1,110,226 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | 231,097 | ||||||
Ending balance (in shares) at Sep. 30, 2020 | 52,775,243 | ||||||
Ending balance at Sep. 30, 2020 | 1,711,116 | $ 4,579 | 610,240 | 1,134 | (66,498) | 1,161,661 | |
Beginning balance at Dec. 31, 2019 | 39,510 | ||||||
Ending balance at Sep. 30, 2020 | 0 | ||||||
Beginning balance (in shares) at Dec. 31, 2019 | 53,622,206 | ||||||
Beginning balance at Dec. 31, 2019 | $ 1,618,055 | $ 4,635 | 577,961 | 1,052 | (75,819) | 1,110,226 | |
Ending balance (in shares) at Dec. 31, 2020 | 52,788,093 | 52,788,093 | |||||
Ending balance at Dec. 31, 2020 | $ 1,850,236 | $ 4,580 | 617,104 | 1,134 | (35,477) | 1,262,895 | |
Beginning balance at Dec. 31, 2019 | 39,510 | ||||||
Beginning balance (in shares) at Mar. 31, 2020 | 52,508,751 | ||||||
Beginning balance at Mar. 31, 2020 | 1,513,852 | $ 4,561 | 584,852 | 1,134 | (98,955) | 1,022,260 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | 47,760 | 47,760 | |||||
Exercise of share options (in shares) | 8,235 | ||||||
Exercise of share options | 587 | $ 1 | 586 | ||||
Issue of restricted share units (in shares) | 112,081 | ||||||
Issue of restricted share units | 7 | $ 7 | |||||
Non-cash stock compensation expense | 7,065 | 7,065 | |||||
Share issuance costs | (3) | (3) | |||||
Other comprehensive income, net of tax | 9,215 | 9,215 | |||||
Ending balance (in shares) at Jun. 30, 2020 | 52,629,067 | ||||||
Ending balance at Jun. 30, 2020 | 1,578,483 | $ 4,569 | 592,500 | 1,134 | (89,740) | 1,070,020 | |
Beginning balance at Mar. 31, 2020 | 0 | ||||||
Ending balance at Jun. 30, 2020 | 0 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | 91,641 | 91,641 | |||||
Exercise of share options (in shares) | 140,945 | ||||||
Exercise of share options | 10,887 | $ 9 | 10,878 | ||||
Issue of restricted share units (in shares) | 5,231 | ||||||
Issue of restricted share units | 1 | $ 1 | |||||
Non-cash stock compensation expense | 6,866 | 6,866 | |||||
Share issuance costs | (4) | (4) | |||||
Other comprehensive income, net of tax | 23,242 | 23,242 | |||||
Ending balance (in shares) at Sep. 30, 2020 | 52,775,243 | ||||||
Ending balance at Sep. 30, 2020 | $ 1,711,116 | $ 4,579 | 610,240 | 1,134 | (66,498) | 1,161,661 | |
Ending balance at Sep. 30, 2020 | $ 0 | ||||||
Beginning balance (in shares) at Dec. 31, 2020 | 52,788,093 | 52,788,093 | |||||
Beginning balance at Dec. 31, 2020 | $ 1,850,236 | $ 4,580 | 617,104 | 1,134 | (35,477) | 1,262,895 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | 97,122 | 97,122 | |||||
Exercise of share options | 0 | ||||||
Issue of restricted share units (in shares) | 70,097 | ||||||
Issue of restricted share units | 5 | $ 5 | |||||
Non-cash stock compensation expense | 6,310 | 6,310 | |||||
Share issuance costs | (5) | (5) | |||||
Other comprehensive income, net of tax | (19,497) | (19,497) | |||||
Ending balance (in shares) at Mar. 31, 2021 | 52,858,190 | ||||||
Ending balance at Mar. 31, 2021 | $ 1,934,171 | $ 4,585 | 623,409 | 1,134 | (54,974) | 1,360,017 | |
Beginning balance (in shares) at Dec. 31, 2020 | 52,788,093 | 52,788,093 | |||||
Beginning balance at Dec. 31, 2020 | $ 1,850,236 | $ 4,580 | 617,104 | 1,134 | (35,477) | 1,262,895 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | $ 76,717 | ||||||
Ending balance (in shares) at Sep. 30, 2021 | 81,397,821 | 81,397,821 | |||||
Ending balance at Sep. 30, 2021 | $ 7,968,586 | $ 6,629 | 6,700,407 | 1,134 | (79,196) | 1,339,612 | |
Beginning balance (in shares) at Mar. 31, 2021 | 52,858,190 | ||||||
Beginning balance at Mar. 31, 2021 | 1,934,171 | $ 4,585 | 623,409 | 1,134 | (54,974) | 1,360,017 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | 73,865 | 73,865 | |||||
Exercise of share options (in shares) | 4,020 | ||||||
Exercise of share options | 170 | 170 | |||||
Issue of restricted share units (in shares) | 95,853 | ||||||
Issue of restricted share units | 7 | $ 7 | |||||
Non-cash stock compensation expense | 8,495 | 8,495 | |||||
Share issuance costs | (5) | (5) | |||||
Other comprehensive income, net of tax | 11,240 | 11,240 | |||||
Ending balance (in shares) at Jun. 30, 2021 | 52,958,063 | ||||||
Ending balance at Jun. 30, 2021 | 2,027,943 | $ 4,592 | 632,069 | 1,134 | (43,734) | 1,433,882 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | (94,270) | (94,270) | |||||
Exercise of share options (in shares) | 909,723 | ||||||
Exercise of share options | 103,865 | $ 54 | 103,811 | ||||
Issue of restricted share units (in shares) | 157,608 | ||||||
Issue of restricted share units | 23 | $ 23 | |||||
Issue of shares associated with a business combination (in shares) | 27,372,427 | ||||||
Issue of shares associated with a business combination | 5,658,126 | $ 1,960 | 5,656,166 | ||||
Replacement share-based awards issued to acquiree employees | 209,399 | 209,399 | |||||
Non-cash stock compensation expense | 99,771 | 99,771 | |||||
Share issuance costs | (809) | (809) | |||||
Other comprehensive income, net of tax | $ (35,462) | (35,462) | |||||
Ending balance (in shares) at Sep. 30, 2021 | 81,397,821 | 81,397,821 | |||||
Ending balance at Sep. 30, 2021 | $ 7,968,586 | $ 6,629 | $ 6,700,407 | $ 1,134 | $ (79,196) | $ 1,339,612 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash flows from operating activities: | ||
Net income | $ 76,717 | $ 231,730 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization expense | 175,317 | 48,981 |
Impairment of right-of-use assets | 5,731 | 5,411 |
Reduction in carrying value of operating right-of-use assets | 30,607 | 21,367 |
Unrealized foreign currency gains, net | (7,374) | (3,982) |
Loss on issuance of debt | 59,460 | 0 |
Loss on equity method investments | 1,471 | 83 |
Stock compensation expense | 114,791 | 20,157 |
Loss/(gain) on interest rate hedge | 891 | (725) |
Amortization of financing costs | 4,448 | 368 |
Loss on extinguishment of debt | 14,434 | 0 |
Deferred taxes | (26,532) | 1,416 |
Other non-cash items | (1,592) | (121) |
Changes in operating assets and liabilities, net of acquired assets and assumed liabilities: | ||
Accounts receivable | 123,413 | 24,623 |
Unbilled revenue | 49,203 | (17,635) |
Unearned revenue | (60,514) | 82,386 |
Other assets and liabilities | (21,147) | (41,446) |
Net cash provided by operating activities | 539,324 | 372,613 |
Cash flows from investing activities: | ||
Purchase of property, plant and equipment | (46,067) | (28,026) |
Purchase of subsidiary undertakings, net of cash acquired | (5,914,475) | (37,761) |
Purchase of equity method investments | (2,450) | (2,450) |
Sale of available for sale investments | 17 | 47,902 |
Purchase of investments in equity - long term | (2,243) | (2,737) |
Net cash used in investing activities | (5,965,218) | (23,072) |
Cash flows from financing activities: | ||
Financing related costs | (30,349) | 0 |
Proceeds from exercise of equity compensation | 104,070 | 12,349 |
Share issue costs | (848) | (10) |
Repurchase of ordinary shares | 0 | (175,000) |
Share repurchase costs | 0 | (140) |
Drawdown of bank credit lines and loan facilities, net of debt issuance costs and debt discount withheld | 5,905,100 | 0 |
Repayment of bank credit lines and loan facilities | (377,780) | 0 |
Net cash provided by (used in) financing activities | 5,600,193 | (162,801) |
Effect of exchange rate movements on cash | (6,080) | 946 |
Net increase in cash and cash equivalents | 168,219 | 187,686 |
Cash and cash equivalents at beginning of period | 840,305 | 520,309 |
Cash and cash equivalents at end of period | $ 1,008,524 | $ 707,995 |
Basis of presentation
Basis of presentation | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation These condensed consolidated financial statements which have been prepared in accordance with United States Generally Accepted Accounting Principles (“US GAAP”) have not been audited. The condensed consolidated financial statements reflect all adjustments, which are, in the opinion of management, necessary to present a fair statement of the operating results and financial position for the periods presented. The preparation of the condensed consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect reported amounts and disclosures in the condensed consolidated financial statements. Actual results could differ from those estimates. The condensed consolidated financial statements should be read in conjunction with the accounting policies and notes to the consolidated financial statements included in ICON’s Form 20-F for the year ended December 31, 2020 (see note 2 - Significant accounting policies for impact of adoption of any new accounting standards). Operating results for the nine months ended September 30, 2021 are not necessarily indicative of the results that may be expected for the fiscal period ending December 31, 2021. Certain prior period amounts in the consolidated financial statements and accompanying notes have been reclassified to conform to the current period’s presentation. Most notably, the Company has presented transaction and integration-related expenses as a separate line in the Condensed Consolidated Statement of Operations and reclassified certain costs incurred in the three and nine months ended September 30, 2020 within this line. These costs consist of transaction and integration-related expenses and contingent consideration valuation adjustments related to ICON's prior period acquisitions. These costs were previously presented in the selling, general and administrative expenses but have been reclassified to transaction and integration-related expenses to conform to the current period’s presentation. |
Significant accounting policies
Significant accounting policies | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Significant accounting policies | Significant accounting policies Revenue recognition The Company earns revenues by providing a number of different services to its customers. These services, which are integral elements of the clinical development process, include clinical trials management, consulting, contract staffing, data services and laboratory services. Contracts range in duration from a number of months to several years. ASC 606 requires application of five steps: (1) identify the contract(s) with a customer; (2) identify the performance obligation in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the entity satisfies the performance obligation(s). Clinical trial service revenue A clinical trial service is a single performance obligation satisfied over time, i.e. the full-service obligation in respect of a clinical trial (including those services performed by investigators and other parties) is considered a single performance obligation. Promises offered to the customer are not distinct within the context of the contract. We have concluded that ICON is the contract principal in respect of both direct services and in the use of third parties (principally investigator services) that support the clinical research project. The transaction price is determined by reference to the contract or change order value (total service revenue and pass-through/ reimbursable expenses) adjusted to reflect a realizable contract value. Revenue is recognized as the single performance obligation is satisfied. The progress towards completion for clinical service contracts is measured based on an input measure being total project costs incurred (inclusive of third party costs) at each reporting period as a percentage of forecasted total project costs. Contracting services revenue The Company has availed of the practical expedient which results in recognition of revenue on a right to invoice basis. Application of the practical expedient reflects the right to consideration from the customer in an amount that corresponds directly with the value to the customer of the performance completion to date. This reflects hours performed by contract staff. Consulting services revenue We have concluded that our consulting services contracts represent a single performance obligation satisfied over time. The transaction price is determined by reference to contract or change order value. Revenue is recognized as the performance obligation is satisfied. The progress towards completion for consulting contracts is measured based on total project inputs (time) at each reporting period as a percentage of forecasted total project inputs. Laboratory services revenue Revenue is recognized when, or as, obligations under the terms of a contract are satisfied, which occurs when control of the products or services are transferred to the customer. Revenue for laboratory services is measured as the amount of consideration we expect to receive in exchange for transferring products or services. Where contracts with customers contain multiple performance obligations, the transaction price is allocated to each performance obligation based on the estimated relative selling price of the promised good or service. Service revenue is recognized over time as the services are delivered to the customer based on the extent of progress towards completion of the performance obligation. The determination of the methodology to measure progress requires judgment and is based on the nature of services provided. This requires an assessment of the transfer of value to the customer. The right to invoice measure of progress is generally related to rate per unit contracts, as the extent of progress towards completion is measured based on discrete service or time-based increments, such as samples tested or labor hours incurred. Revenue is recorded in the amount invoiced since that amounts corresponds to the value of the Company's performance and the transfer of value to the customer. Data services revenue The Company provides data reports and analytics to customers based on agreed-upon specifications, including the timing of delivery, which is typically either weekly, monthly, or quarterly. If a customer requests more than one type of data report or series of data reports within a contract, each distinct type of data report is a separate performance obligation. The contracts provide for the Company to be compensated for the value of each deliverable. The transaction price is determined using list prices, discount agreements, if any, and negotiations with the customers, and generally includes any out-of-pocket expenses. Typically, the Company bills in advance of services being provided with the amount being recorded as unearned revenue. When multiple performance obligations exist, the transaction price is allocated to performance obligations on a relative standalone selling price basis. In cases where the Company contracts to provide a series of data reports, or in some cases data, the Company recognizes revenue over time using the “units delivered” output method as the data or reports are delivered. Expense reimbursements are recorded to revenue as the expenses are incurred as they relate directly to the services performed. Certain arrangements include upfront customization or consultative services for customers. These arrangements often include payments based on the achievement of certain contractual milestones. Under these arrangements, the Company contracts with a customer to carry out a specific study, ultimately resulting in delivery of a custom report or data product. These arrangements are a single performance obligation given the integrated nature of the service being provided. The Company typically recognizes revenue under these contracts over time, using an output-based measure, generally time elapsed, to measure progress and transfer of control of the performance obligation to the customer. Expense reimbursements are recorded to revenue as the expenses are incurred as they relate directly to the service performed. The Company enters into contracts with some of its larger data suppliers that involve non-monetary terms. The Company will issue purchase credits to be used toward the data supplier's purchase of the Company's services based on the fair value of the data obtained. In exchange, the Company receives monetary discounts on the data received from the data suppliers. The fair value of the revenue earned from the customer purchases is recognized as services are delivered as described above. At the end of the contract year, any unused customer purchase credits may be forfeited or carried over to the next contract year based on the terms of the data supplier contract. Commissions Incremental costs of obtaining a contract are recognized as an asset on the Condensed Consolidated Balance Sheet in respect of those contracts that exceed one year. Where commission costs relate to contracts that are less than one year, the practical expedient is applied as the amortization period of the asset which would arise on deferral would be one year or less. Business combinations The cost of a business combination is measured as the aggregate of the fair values at the date of exchange of assets given, liabilities incurred or assumed and equity instruments issued in exchange for control. Where a business combination agreement provides for an adjustment to the cost of the acquisition which is contingent upon future events, the amount of the estimated adjustment is recognized at the acquisition date at the fair value of the contingent consideration. Any changes to this estimate outside the measurement period will depend on the classification of the contingent consideration. If the contingent consideration is classified as equity it shall not be re-measured and the settlement shall be accounted for within equity. If the contingent consideration is classified as a liability any adjustments will be accounted for through the Condensed Consolidated Statement of Operations or Other Comprehensive Income depending on whether the liability is considered a financial instrument. The assets, liabilities and contingent liabilities of businesses acquired are measured at their fair values at the date of acquisition. In the case of a business combination which is completed in stages, the fair values of the identifiable assets, liabilities and contingent liabilities are determined at the date of each exchange transaction. When the initial accounting for a business combination is determined provisionally, any subsequent adjustments to the provisional values allocated to the identifiable assets, liabilities and contingent liabilities are made within twelve months of the acquisition date and presented as adjustments to goodwill in the reporting period in which the adjustments are determined. Debt issuance costs Debt issuance costs relating to the Company’s long-term debt are recorded as a direct reduction of long-term debt; these costs are deferred and amortized to interest expense using the effective interest method, over the respective terms of the related debt. Debt issuance costs relating to the Company’s revolving credit facilities are recorded as an asset; these costs are deferred and amortized to interest expense using the straight-line method. Transaction and integration-related expenses Transaction and integration-related expenses are the incremental costs directly attributable to the completion and integration activities associated with the Company’s recent acquisitions. The costs consist of investment banking fees, advisory costs, retention agreements with employees, accelerated share compensation charges, contingent consideration valuation adjustments and ongoing integration activities. The Company accounts for these transaction and integration-related costs as expenses in the periods in which the costs are incurred and the services are received. Goodwill Goodwill represents the excess of the cost of acquired entities over the net amounts assigned to assets acquired and liabilities assumed. Goodwill primarily comprises acquired workforce in place which does not qualify for recognition as an asset apart from goodwill. Goodwill is stated net of any provision for impairment. Intangible assets Intangible assets are amortized on a straight line basis over their estimated useful life. Disclosure of fair value of financial instruments Cash, cash equivalents, other receivables, available for sale investments, accounts receivable, accounts payable, investigator payments and income taxes payable have carrying amounts that approximate fair value due to the short term maturities of these instruments. Other liabilities' carrying amounts approximate fair value based on net present value of estimated future cash flows. Debt is measured at historical cost. Financial instruments are measured in the Condensed Consolidated Balance Sheets at amortized cost or fair value using a fair value hierarchy of valuation inputs. For financial instruments measured at amortized cost, the fair value of these financial instruments closely approximates their fair value. The fair value hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of three levels, which is determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are: Level 1: Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets. Level 2: Inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3: Inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The Company classifies its investments in short term debt or equity investments as available for sale, as it does not actively trade such securities nor does it intend to hold them to maturity. The fair value of short term investments are represented by level 1 fair value measurements – quoted prices in active markets for identical assets. The unrealized movements in fair value are recognized in equity until disposal or sale, at which time, those unrealized movements from prior periods are recognized in the Condensed Consolidated Statement of Operations. Losses other than temporary, which reduce the carrying amount below cost are recognized in Condensed Consolidated Statement of Operations. Share-based compensation The Company accounts for its share options, Restricted Share Units ("RSUs") and Performance Share Units ("PSUs") in accordance with the provisions of ASC 718 'Compensation – Stock Compensation'. Share-based compensation expense for equity-settled awards made to employees and directors is measured and recognized based on estimated grant date fair values. These equity-settled awards include employee share options, RSUs and PSUs. Share-based compensation expense for share options awarded to employees and directors is estimated at the grant date based on each option's fair value as calculated using the Black-Scholes option-pricing model. Share-based compensation for RSUs and PSUs awarded to employees and directors is calculated based on the market value of the Company's shares on the date of award of the RSUs and PSUs. The value of awards expected to vest is recognized as an expense over the requisite service periods. We account for forfeitures as they occur. Estimating the grant date fair value of share options as of the grant date using an option-pricing model, such as the Black-Scholes model, is affected by the Company's share price as well as assumptions regarding a number of complex variables. These variables include, but are not limited to, the expected share price volatility over the term of the awards, risk-free interest rates and the expected term of the awards. |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Revenue disaggregated by customer profile is as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Clients 1-5 525,806 269,460 1,242,446 802,503 Clients 6-10 283,003 89,062 472,788 249,807 Clients 11-25 398,816 118,156 704,312 344,463 Other 658,727 225,051 1,176,159 640,286 Total $ 1,866,352 $ 701,729 $ 3,595,705 $ 2,037,059 Revenue from individual customers greater than 10% of consolidated revenue in the respective periods was as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 Customer: Customer A * 12.4 % * 11.5 % Customer B * * * 10.7 % *Less than 10% Accounts receivables and unbilled revenue are as follows: September 30, 2021 December 31, 2020 (in thousands) Contract assets: Billed services (accounts receivable) $ 1,345,588 $ 722,420 Unbilled services (unbilled revenue) 550,692 428,684 Accounts receivable and unbilled revenue 1,896,280 1,151,104 Allowance for credit losses (7,262) (7,149) Accounts receivable and unbilled revenue, net $ 1,889,018 $ 1,143,955 Unbilled services and unearned revenue or payments on account (contract assets and liabilities) were as follows: (in thousands, except percentages) September 30, 2021 December 31, 2020 $ Change % Change Unbilled services (unbilled revenue) $ 550,692 $ 428,684 $ 122,008 28.5 % Unearned revenue (payments on account) (1,349,000) (660,883) (688,117) 104.1 % Net balance $ (798,308) $ (232,199) $ (566,109) 243.8 % Timing may differ between the satisfaction of performance obligations and the invoicing and collection of amounts related to our contracts with customers. We record assets for amounts related to performance obligations that are satisfied but not yet billed and/or collected. These assets are recorded as unbilled services and therefore contract assets rather than accounts receivables when receipt of the consideration is conditional on something other than the passage of time. Liabilities are recorded for amounts that are collected in advance of the satisfaction of performance obligations or billed in advance of the revenue being earned. Unbilled services/revenue balances arise where invoicing or billing is based on the timing of agreed milestones related to service contracts for clinical research. Contractual billing arrangements in respect of certain reimbursable expenses (principally investigators) require billing by the investigator to the Company prior to billing by the Company to the customer. As there is no contractual right to set-off between unbilled services (contract assets) and unearned revenue (contract liabilities), each are separately presented gross on the Condensed Consolidated Balance Sheet. Unbilled services as at September 30, 2021 increased by $122.0 million compared to December 31, 2020. Unearned revenue increased by $688.1 million over the same period resulting in a decrease of $566.1 million in the net balance of unbilled services and unearned revenue or payments on account between December 31, 2020 and September 30, 2021. These fluctuations are primarily due to the Merger with PRA on July 1, 2021 but also partly due to timing of payments and invoicing related to the Group's clinical trial management contracts. Billings and payments are established by contractual provisions including predetermined payment schedules which may or may not correspond to the timing of the transfer of control of the Company's services under the contract. Unbilled services arise from long-term contracts when a cost-based input method of revenue recognition is applied and revenue recognized exceeds the amount billed to the customer. As of September 30, 2021 approximately $13.0 billion (September 30, 2020: $6.1 billion) of revenue is expected to be recognized in the future in respect of unsatisfied performance obligations. The Company expects to recognize revenue on approximately 49% of t he |
Accounts receivable, unbilled r
Accounts receivable, unbilled revenue (contract assets) and unearned revenue or payments on account (contract liabilities) | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Accounts receivable, unbilled revenue (contract assets) and unearned revenue or payments on account (contract liabilities) | Revenue Revenue disaggregated by customer profile is as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Clients 1-5 525,806 269,460 1,242,446 802,503 Clients 6-10 283,003 89,062 472,788 249,807 Clients 11-25 398,816 118,156 704,312 344,463 Other 658,727 225,051 1,176,159 640,286 Total $ 1,866,352 $ 701,729 $ 3,595,705 $ 2,037,059 Revenue from individual customers greater than 10% of consolidated revenue in the respective periods was as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 Customer: Customer A * 12.4 % * 11.5 % Customer B * * * 10.7 % *Less than 10% Accounts receivables and unbilled revenue are as follows: September 30, 2021 December 31, 2020 (in thousands) Contract assets: Billed services (accounts receivable) $ 1,345,588 $ 722,420 Unbilled services (unbilled revenue) 550,692 428,684 Accounts receivable and unbilled revenue 1,896,280 1,151,104 Allowance for credit losses (7,262) (7,149) Accounts receivable and unbilled revenue, net $ 1,889,018 $ 1,143,955 Unbilled services and unearned revenue or payments on account (contract assets and liabilities) were as follows: (in thousands, except percentages) September 30, 2021 December 31, 2020 $ Change % Change Unbilled services (unbilled revenue) $ 550,692 $ 428,684 $ 122,008 28.5 % Unearned revenue (payments on account) (1,349,000) (660,883) (688,117) 104.1 % Net balance $ (798,308) $ (232,199) $ (566,109) 243.8 % Timing may differ between the satisfaction of performance obligations and the invoicing and collection of amounts related to our contracts with customers. We record assets for amounts related to performance obligations that are satisfied but not yet billed and/or collected. These assets are recorded as unbilled services and therefore contract assets rather than accounts receivables when receipt of the consideration is conditional on something other than the passage of time. Liabilities are recorded for amounts that are collected in advance of the satisfaction of performance obligations or billed in advance of the revenue being earned. Unbilled services/revenue balances arise where invoicing or billing is based on the timing of agreed milestones related to service contracts for clinical research. Contractual billing arrangements in respect of certain reimbursable expenses (principally investigators) require billing by the investigator to the Company prior to billing by the Company to the customer. As there is no contractual right to set-off between unbilled services (contract assets) and unearned revenue (contract liabilities), each are separately presented gross on the Condensed Consolidated Balance Sheet. Unbilled services as at September 30, 2021 increased by $122.0 million compared to December 31, 2020. Unearned revenue increased by $688.1 million over the same period resulting in a decrease of $566.1 million in the net balance of unbilled services and unearned revenue or payments on account between December 31, 2020 and September 30, 2021. These fluctuations are primarily due to the Merger with PRA on July 1, 2021 but also partly due to timing of payments and invoicing related to the Group's clinical trial management contracts. Billings and payments are established by contractual provisions including predetermined payment schedules which may or may not correspond to the timing of the transfer of control of the Company's services under the contract. Unbilled services arise from long-term contracts when a cost-based input method of revenue recognition is applied and revenue recognized exceeds the amount billed to the customer. As of September 30, 2021 approximately $13.0 billion (September 30, 2020: $6.1 billion) of revenue is expected to be recognized in the future in respect of unsatisfied performance obligations. The Company expects to recognize revenue on approximately 49% of t he |
Goodwill
Goodwill | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill Nine Months Ended Year Ended September 30, 2021 December 31, 2020 (in thousands) Opening balance $ 936,257 $ 883,170 Current period acquisitions (Note 7) 8,013,878 27,191 Prior period acquisitions — 123 Foreign exchange movement (14,923) 25,773 Closing balance $ 8,935,212 $ 936,257 |
Intangible assets
Intangible assets | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible assets | Intangible assets Intangible assets, net consisted of the following: Nine Months Ended Year Ended September 30, 2021 December 31, 2020 Cost (in thousands) Customer relationships $ 4,047,002 $ 144,251 Order backlog 527,324 39,269 Trade names & brands 204,705 2,766 Patient database 170,513 2,552 Technology assets 121,672 11,173 Total cost 5,071,216 200,011 Accumulated amortization (256,032) (133,551) Net book value $ 4,815,184 $ 66,460 |
Business combinations
Business combinations | 9 Months Ended |
Sep. 30, 2021 | |
Business Combinations [Abstract] | |
Business combinations | Business combinations PRA Health Sciences, Inc. - Merger Completion On July 1, 2021 (the "Merger Date"), ICON plc announced the completion of its Merger with PRA Health Sciences, Inc. ("PRA"). The combined company has retained the name ICON and brings together approximately 37,960 employees across 53 countries, creating the world’s most advanced healthcare intelligence and clinical research organization. The Merger was accounted for as a business combination using the acquisition method of accounting in accordance with ASC Topic 805, Business Combinations. The combined company leverages its enhanced operations to transform clinical trials and accelerate biopharma customers’ commercial success through the development of much needed medicines and medical devices. The new ICON has a renewed focus on leveraging data, applying technology and accessing diverse patient populations to speed up drug development. Upon completion of the Merger, pursuant to the terms of the merger agreement, PRA became a wholly owned subsidiary of ICON plc. Under the terms of the Merger, PRA shareholders received per share $80 in cash and 0.4125 shares of ICON stock. The trading of PRA common stock on NASDAQ was suspended prior to market open on July 1, 2021. In the nine months ended September 30, 2021, the Company incurred $182.3 million of Merger-related expenses which were accounted for separately from the business combination and expensed as incurred within the “Transaction and integration related expenses” line item of the condensed consolidated statements of operations. These costs consisted primarily of investment banker fees, advisory fees, legal costs, accounting and consulting fees, share-based compensation expense, and employee retention bonuses. The Company also incurred approximately $78.2 million of financing fees which are included in the “Interest expense” line item in the Condensed Consolidated Statements of Operations for the nine months ended September 30, 2021. The Company deferred $76.2 million of financing costs incurred as a result of the Senior Secured Credit Facility and Senior Secured Notes. These costs will be amortized over the term of the related debt. The purchase accounting associated with the PRA Merger remains ongoing and we continue to review the acquisition balance sheet. We expect to conclude the purchase accounting exercise by June 30, 2022. The preliminary Merger Date fair value of the consideration transferred consisted of the following: (in thousands) Fair value of cash consideration $ 5,308,646 Fair value of ordinary shares issued to acquiree stockholders 5,658,126 Fair value of replacement share-based awards issued to acquiree employees 209,399 Repayment of term loan obligations and accrued interest * 865,800 $ 12,041,971 * This represents the portion of PRA debt paid by ICON. PRA also paid $401.6 million from available cash to settle debt obligations that existed at the Merger Date. The following table summarizes the preliminary allocation of the consideration transferred based on management’s estimates of Merger Date fair values of assets acquired and liabilities assumed, with the excess of the purchase price over the estimated fair values of the identifiable net assets acquired recorded as goodwill: July 1, 2021 (in thousands) Cash and cash equivalents $ 259,971 Accounts receivable and unbilled revenue 934,308 Other current assets 110,691 Fixed assets, net 162,988 Operating lease right-of-use assets 192,345 Goodwill * 8,013,878 Intangible assets, net 4,875,000 Deferred tax assets 172,229 Other assets 35,094 Accounts payable (50,259) Accrued expenses and other current liabilities (342,552) Current portion of operating lease liabilities (38,371) Unearned revenue (758,901) Non-current portion of operating lease liabilities (157,658) Non-current deferred tax liabilities (1,313,599) Other non-current liabilities (53,193) Net assets acquired $ 12,041,971 * The goodwill in connection with the Merger is primarily attributable to the assembled workforce of PRA and the expected synergies of the Merger. None of the goodwill recognized is expected to be deductible for income tax purposes. The following table summarizes the preliminary estimates of the fair value of identified intangible assets and their respective useful lives as of the Merger Date (in thousands, except for estimated useful lives): Estimated Fair Value Estimated Useful Life Customer relationship 3,905,000 23 years Order backlog 489,000 3 years Trade names 202,000 3 years Patient database 168,000 7 years Technology 111,000 5 years 4,875,000 Since July 1, 2021, PRA has earned revenue of $1,019.7 million and pre-tax net income of $113.4 million in the three months ended September 30, 2021. Pro forma financial information The following pro forma financial information was derived from the historical financial statements of the Company and PRA and presents the combined results of operations as if the Merger had occurred on January 1, 2020. The pro forma financial information is presented for comparative purposes only and is not necessarily indicative of the results that would have actually occurred had the Merger been completed on January 1, 2020. In addition, the pro forma financial information does not give effect to any anticipated cost savings, operating efficiencies or other synergies that may result from the Merger, or any estimated costs that have been or will be incurred by the Company to integrate the assets and operations of PRA. Consequently, actual future results of the Company will differ from the pro forma financial information presented below: Nine months ended Year ended September 30 December 31 2021 2020 (in thousands, except per share data) Revenue $ 5,580,879 $ 5,964,653 Net income/(loss) $ 231,442 $ (151,209) The pro forma adjustments primarily relate to the amortization of acquired intangible assets, interest expense and amortization of deferred financing costs related to the new financing arrangements. In addition, the pro forma net income for the nine months ended September 30, 2021 was adjusted to exclude certain merger-related nonrecurring adjustments; these adjustments were included in the year ended December 31, 2020 giving effect to the Merger as if it had occurred on January 1, 2020. The nonrecurring merger related adjustments include transaction costs, share-based compensation expense related to the acceleration of share-based compensation awards and replacement share-based awards, and financing fees. The merger related adjustment were tax effected using the Company's effective tax rate. Acquisitions – MedPass Group ("MedPass") On January 22, 2020 a subsidiary of the Company, ICON Investments Limited acquired 100% of the equity share capital of the MedPass Group. MedPass is the leading European medical device CRO, regulatory and reimbursement consultancy, that specializes in medical device development and market access. The acquisition of MedPass further enhances ICON’s Medical Device and Diagnostic Research services, through the addition of new regulatory and clinical capabilities in Europe. The integration of MedPass’s services brings noted expertise in complex class 3 medical devices, interventional cardiology and structural heart devices . Accounting for the acquisition of MedPass was finalized in the period ended December 31, 2020. The acquisition of MedPass has been accounted for as a business combination in accordance with ASC 805 ' Business Combinations' . The Company has made an assessment of the fair value of assets acquired and liabilities assumed as at that date. The following table summarizes the Company’s fair values of the assets acquired and liabilities assumed: January 22, 2020 (in thousands) Cash & cash equivalents $ 10,170 Property, plant and equipment 45 Operating right of use assets 539 Goodwill * 27,191 Customer relationships 11,725 Order backlog 2,883 Accounts receivable 3,033 Prepayments and other current assets 158 Accounts payable (368) Unearned revenue (989) Other liabilities (2,202) Current lease liabilities (219) Non-current lease liabilities (320) Non-current deferred tax liability (4,090) Net assets acquired $ 47,556 Cash outflows $ 46,992 Working capital adjustment paid 564 Contingent consideration ** — Total consideration $ 47,556 * Goodwill represents the acquisition of an established workforce that specializes in medical device development and market access. None of the goodwill recognized is expected to be deductible for income tax purposes. ** The fair value of the contingent consideration was estimated at the date of acquisition as $Nil. Depending on performance of MedPass for the 12 month period ended December 31, 2020, the total consideration could have increased by a maximum of $6.7 million in contingent consideration. In January 2021, the contingent consideration was finalized and a value of $Nil was payable. |
Equity method investments
Equity method investments | 9 Months Ended |
Sep. 30, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity method investments | Equity method investmentsThe Company has invested $4.9 million to obtain a 49% interest in the voting share capital of Oncacare Limited ("Oncacare"). The Company’s investment in Oncacare is accounted for under the equity method due to the Company's ability to exercise significant influence over Oncacare that is considered to be greater than minor. The Company records its pro rata share of the earnings/losses of this investment in 'Share of equity method investments' in the Condensed Consolidated Statement of Operations. The majority investor has the right to sell the 51% majority voting share capital exclusively to the Company in a two and half year period commencing from January 1, 2023 and ICON also has the right to acquire the 51% majority voting share capital from August 1, 2025. The following table represents our equity method investments at September 30, 2021: Ownership Percentage Carrying Value Carrying Value September 30, 2021 September 30, 2021 December 31, 2020 (in thousands) Oncacare Limited 49 % $ 3,062 $ 4,534 The Company has recorded a loss of $0.7 million representing its pro rata share of the losses in Oncacare for the three month period ended September 30, 2021. The Company recorded a loss of $1.5 million for the nine months ended September 30, 2021. |
Fair value measurements
Fair value measurements | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair value measurements | Fair value measurements The Company records certain assets and liabilities at fair value. Fair value is defined as the price that would be received to sell an asset, or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy that prioritizes the inputs used to measure fair value is described below. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: • Level 1 — Quoted prices in active markets for identical assets or liabilities. • Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. • Level 3 — Unobservable inputs that are supported by little or no market activity. This includes certain pricing models, discounted cash flow methodologies, and similar techniques that use significant unobservable inputs. The carrying amounts of financial instruments, including cash and cash equivalents, accounts receivable, unbilled services, contract assets, accounts payable, and unearned revenue approximate fair value due to the short maturities of these instruments. Recurring Fair Value Measurements The Company classifies its interests in investments in equity-long term having considered the nature of its investment, the extent of influence over operating and financial decisions and the availability of readily determinable fair values. The Company determined that the interests in funds at September 30, 2021 and December 31, 2020 meet the definition of equity securities without readily determinable fair values. The Company concluded that the interests held at September 30, 2021 and December 31, 2020 qualify for the Net Asset Value (NAV) practical expedient in ASC 820 'Fair value measurements and disclosures'. Any increases or decreases in fair value are recognized in net income in the period. These are therefore measured at Level 3 of the fair value hierarchy. The value of these investments were $22.8 million at September 30, 2021 and $15.8 million at December 31, 2020. Non-recurring Fair Value Measurements Certain assets and liabilities are carried on the accompanying Condensed Consolidated Balance Sheet at cost and are not re-measured to fair value on a recurring basis. These assets include finite-lived intangible assets that are tested for impairment when a triggering event occurs and goodwill and identifiable indefinite-lived intangible assets that are tested for impairment annually or when a triggering event occurs. As of September 30, 2021, assets carried on the balance sheet and not re-measured to fair value on a recurring basis totaled approximately $13,750.4 million and are identified as Level 3 assets. These assets are comprised of goodwill of $8,935.2 million and identifiable intangible assets, net of $4,815.2 million. Refer to "Note 12 - Non-current bank credit lines and loan facilities" for additional information regarding the fair value of long-term debt balances. |
Restructuring
Restructuring | 9 Months Ended |
Sep. 30, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring Restructuring plans reflect rationalizations across the business to improve resource utilization related to the Group's workforce as well as facilities. Nine Months Ended Year ended September 30, 2021 December 31, 2020 (in thousands) Opening provision $ 10,748 $ 1,637 Additional provisions 6,162 18,089 Utilization (6,802) (9,303) Foreign exchange movement (93) 325 Ending provision $ 10,015 $ 10,748 In the nine months ended September 30, 2021, a restructuring charge of $6.2 million was recorded in the Condensed Consolidated Statement of Operations, including the recognition of an impairment of right of use assets of $5.7 million. This charge reflects an ongoing restructuring program to rationalize the Company's global office footprint. |
Operating leases
Operating leases | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
Operating leases | Operating leases Lease costs recorded under operating leases for the three and nine months ended September 30, 2021 and September 30, 2020 were as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Operating lease costs $ 18,905 $ 7,417 $ 34,243 $ 23,274 Income from sub-leases (312) (268) (743) (781) Net operating lease costs $ 18,593 $ 7,149 $ 33,500 $ 22,493 Of the total cost of $33.5 million incurred in the nine months ended September 30, 2021 (September 30, 2020: $22.5 million), $31.9 million (September 30, 2020: $20.6 million) is recorded within selling, general and administration costs and $1.6 million (September 30, 2020: $1.9 million) is recorded within direct costs. During the three and nine months ended September 30, 2021 and September 30, 2020, costs incurred by the Group related to variable lease payments was de minimis. Right-of-use assets obtained during the three months ended September 30, 2021, excluding early termination options, now reasonably certain to be exercised of $Nil (September 30, 2020: $Nil ), totaled $1.1 million (September 30, 2020: $5.3 million). Right-of-use assets obtained during the nine months ended September 30, 2021, excluding early termination options now reasonably certain to be exercised of $4.2 million (September 30, 2020: $1.6 million), totaled $4.9 million (September 30, 2020: $8.2 million). In the three and nine months ended September 30, 2021, office consolidations resulted in the recognition of a restructuring provision. The right-of-use assets related to these offices have been impaired to the extent they are considered onerous and a loss of $5.7 million was recorded (September 30, 2020: $5.4 million) (see note 10 - Restructuring ). The weighted average remaining lease term and weighted-average discount rate at September 30, 2021 were 6.94 years and 2.16%, respectively. Future minimum lease payments under non-cancelable leases as of September 30, 2021 were as follows: Minimum rental payments (in thousands) September 30, 2021 Year 1 $ 67,214 Year 2 55,183 Year 3 36,907 Year 4 24,320 Year 5 20,284 Thereafter 70,292 Total future minimum lease payments 274,200 Lease imputed interest (21,345) Total $ 252,855 other liabilities |
Non-current bank credit lines a
Non-current bank credit lines and loan facilities | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Non-current bank credit lines and loan facilities | Non-current bank credit lines and loan facilities The Company had the following debt outstanding as of September 30, 2021 and December 31, 2020: Principal amount Interest rate as of September 30, December 31, (in thousands) September 30, 2021 2021 2020 Maturity Date Senior Secured Credit Facility Term loan 3.00 % $ 5,501,213 $ — July 2028 Senior Secured Notes 2.875 % 500,000 — July 2026 2020 Senior Notes: Series A notes — 275,000 Series B notes — 75,000 Total debt 6,001,213 350,000 Less current portion of long-term debt (55,150) — Total long-term debt 5,946,063 350,000 Less debt issuance costs and debt discount (73,343) (1,523) Total long-term debt, net $ 5,872,720 $ 348,477 The Company paid a $27.6 million debt discount in connection with the Senior Secured Credit Facility and Senior Secured Notes. As of September 30, 2021, the contractual maturities of the Company's debt obligations were as follows: Current maturities of long-term debt: (in thousands) 2021 (remaining) $ 13,788 2022 55,150 2023 55,150 2024 55,150 2025 and thereafter 5,821,975 Total $ 6,001,213 The Company's primary financing arrangements are its senior secured credit facilities (the "Senior Secured Credit Facilities"), which consists of a senior secured term loan and a revolving credit facility, and the senior secured notes (the "Senior Secured Notes"). Senior Secured Credit Facilities In conjunction with the completion of the Merger agreement, on July 1, 2021, ICON entered into a credit agreement providing for a senior secured term loan facility of $5,515 million and a senior secured revolving loan facility in an initial aggregate principal amount of $300 million. The proceeds of the senior secured term loan facility were used to repay in full (i) PRA’s existing credit facilities and (ii) the Company's private placement notes outstanding and fund, in part, the transaction. The senior secured term loan facility will mature in July 2028 and the revolving loan facility will mature in July 2026. Borrowings under the senior secured term loan facility amortize in equal quarterly installments in an amount equal to 1.00% per annum of the principal amount, with the remaining balance due at final maturity. The interest rate margin applicable to borrowings under the senior secured term loan facility will be, at the option of the applicable borrower (as defined in the credit agreement), either (i) the base rate (as described in the credit agreement) plus an applicable margin of 1.50% or (ii) LIBOR plus an applicable margin of 2.50%, in each case, with a step down of 0.25% if the first lien net leverage ratio is equal to or less than 4.00 to 1.00. The senior secured term loan facility is subject to a LIBOR floor of 0.50%. The interest rate margin applicable to borrowings under the revolving loan facility will be, at the option of the borrower, either (i) the applicable base rate plus an applicable margin of 1.00%, 0.60% or 0.25% based on ICON’s current corporate family rating assigned by S&P of BB- (or lower), BB or BB+ (or higher), respectively, or (ii) LIBOR (or an alternative reference rate) plus an applicable margin of 2.00%, 1.60% or 1.25% based on ICON’s current corporate family rating assigned by S&P of BB- (or lower), BB or BB+ (or higher), respectively. In addition, lenders of under the revolving loan facility are entitled to commitment fees as a percentage of the applicable margin at the time of drawing and utilization fees dependent on the proportion of the facility drawn. At September 30, 2021, no amounts have been drawn under the revolving loan facility. The Borrowers’ (as defined in the credit agreement) obligations under the Senior Secured Credit Facilities are guaranteed by ICON and the subsidiary guarantors. The Senior Secured Credit Facilities are secured by a lien on substantially all of ICON’s, the Borrowers’ and each of the subsidiary guarantor’s assets (subject to certain exceptions), and the Senior Secured Credit Facilities will have a first-priority lien on such assets, which will rank pari passu with the lien securing the Senior Secured Notes (see below), subject to other permitted liens. On September 27, 2021, the Company repaid $13.8 million of the senior secured term loan facility and made a quarterly interest payment of $40.4 million. Senior Secured Notes In addition to the Senior Secured Credit Facilities, on July 1, 2021, a subsidiary of the Company issued $500 million in aggregate principal amount of 2.875% senior secured notes due 2026 in a private offering (the “Offering”). The Senior Secured Notes will mature on July 15, 2026. The proceeds from the Offering and borrowings made under the Senior Secured Credit Facilities, together with cash on hand, were used to (i) fund the cash consideration payable by ICON for the Merger, (ii) repay existing indebtedness of ICON and PRA and (iii) pay fees and expenses related to the Merger, the Offering and the Senior Secured Credit Facilities. The Senior Secured Notes are guaranteed on a senior secured basis by ICON and its direct and indirect subsidiaries that guarantee the Senior Secured Credit Facilities. 2020 Senior Notes On December 8, 2020, the Company issued new senior notes, (the "2020 Senior Notes") for aggregate gross proceeds of $350.0 million in the private placement market. The 2020 Senior Notes were issued in two tranches; Series A Notes of $275.0 million at a fixed interest rate of 2.32% and Series B Notes of $75.0 million at a fixed interest rate of 2.43%. The effective interest rate was adjusted by the impact of an interest rate cash flow hedge which was entered into in advance of the rate fixing date. This cash flow hedge was deemed to be fully effective in accordance with ASC 815 'Derivatives and Hedging' . The realized loss related to this derivative was recorded within other comprehensive income and amortized over the life of the 2020 Senior Notes. The effective rate on the 2020 Senior Notes was fixed at 2.41%. In connection with the Merger, the Company was required to repay the 2020 Senior Notes prior to entering into the Senior Secured Credit Facilities and the Senior Secured Notes. In June 2021, ICON committed to entering into the Senior Secured Credit Facilities and the Senior Secured Notes and therefore committed to replacing the 2020 Senior Notes. The 2020 Senior Notes have been repaid and long term financing consisting of the Senior Secured Credit Facilities and the Senior Secured Notes have been drawn. The 2020 Senior Notes were repaid on July 1, 2021 inclusive of early repayment charges. The total repayment on July 1, 2021 was $364.0 million. Fair Value of Debt The estimated fair value of the Company’s debt was $6,035.1 million at September 30, 2021. The fair values of the Senior Secured Credit Facilities and Senior Secured Notes were determined based on Level 2 inputs, which are primarily based on rates at which the debt is traded among financial institutions adjusted for the Company's credit standing. |
Income taxes
Income taxes | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxes Income taxes recognized during the three and nine months ended September 30, 2021 and September 30, 2020, comprise: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Provision for income taxes (excluding restructuring) $ (2,401) $ 13,706 $ 27,880 $ 34,967 Tax impact of restructuring (1,162) — (1,162) (2,261) Provision for income taxes $ (3,563) $ 13,706 $ 26,718 $ 32,706 As at September 30, 2021 the Company maintains a $59.8 million liability (December 31, 2020: $19.6 million) for unrecognized tax benefit, which is comprised of $55.4 million (December 31, 2020: $19.1 million) related to items generating unrecognized tax benefits and $4.4 million (December 31, 2020: $0.5 million) for interest related to such items. The Company recognizes interest accrued on unrecognized tax benefits as an additional income tax expense. |
Net income per ordinary share
Net income per ordinary share | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Net income per ordinary share | Net income per ordinary share Basic net income per ordinary share attributable to the Group has been computed by dividing net income available to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted net income per ordinary share is computed by adjusting the weighted average number of ordinary shares outstanding during the period for all potentially dilutive ordinary shares outstanding during the period and adjusting net income for any changes in income or loss that would result from the conversion of such potential ordinary shares. The Group is in a net loss position for the three months ended September 30, 2021, and therefore ordinary shares potentially issuable from share-based payment arrangements are anti-dilutive due to the loss in the period, meaning there is no difference between basic and diluted net income per ordinary share attributable to the Group. There is no difference in net income used for basic and diluted net income per ordinary share. Basic and diluted net income per ordinary share attributable to the Group for the nine months ended September 30, 2020 includes the adjustment to reflect the accretion of the noncontrolling interest in MeDiNova to its redemption value ("NCI redemption amount). The reconciliation of the number of shares used in the computation of basic and diluted net income per ordinary share is as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 Weighted average number of ordinary shares outstanding for basic net income per ordinary share 80,771,397 52,737,299 62,264,851 52,885,252 Effect of dilutive share options and other awards outstanding under share based compensation programs — 457,028 831,006 398,428 Weighted average number of ordinary shares outstanding for diluted net income per ordinary share 80,771,397 53,194,327 63,095,857 53,283,680 The reconciliation of net income attributable to the Group and net income attributable to the Group (including NCI redemption amount) as used to calculate net income per ordinary share attributable to the Group is as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Net (loss)/income attributable to the Group $ (94,270) $ 91,641 $ 76,717 $ 231,097 Noncontrolling interest adjustment to redemption amount — — — (4,522) Net income attributable to the Group (including NCI redemption adjustment) $ (94,270) $ 91,641 $ 76,717 $ 226,575 Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 Net income/(loss) per Ordinary Share attributable to the Group (including NCI redemption adjustment): Basic $ (1.17) $ 1.74 $ 1.23 $ 4.28 Diluted $ (1.17) $ 1.72 $ 1.22 $ 4.25 The diluted net loss per ordinary share attributable to the Group for the three month period ended September 30, 2021 above excludes the effect of dilutive share options and other awards outstanding under share based compensation programs in the amount of 1,521,890 shares. |
Share-based awards
Share-based awards | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Share-based awards | Share-based awards Share Options The following table summarizes option activity for the nine months ended September 30, 2021: Options Weighted Weighted Outstanding at December 31, 2020 553,746 $ 108.53 4.86 Assumed through business combinations (a) 2,177,130 $ 108.78 Granted 100,299 $ 177.76 Exercised (913,743) $ 113.87 Canceled/expired (32,784) $ 132.25 Outstanding at September 30, 2021 1,884,648 $ 109.50 5.66 Exercisable at September 30, 2021 1,095,429 $ 90.80 4.72 (a) Represents stock options issued as replacement awards in connection with the Merger. The Company issues ordinary shares for all options exercised. The total amount of fully vested share options which remained outstanding at September 30, 2021 was 1,095,429. Fully vested share options at September 30, 2021 have an average remaining contractual term of 4.72 years, an average exercise price of $90.80. Fair value of Stock Options Assumptions The weighted average fair value of options granted during the nine months ended September 30, 2021 and September 30, 2020 was calculated using the Black-Scholes option pricing model. The weighted average grant date fair values and assumptions used were as follows: Nine Months Ended September 30, 2021 September 30, 2020 Weighted average grant date fair value $ 49.15 $ 42.43 Assumptions: Expected volatility 30 % 30 % Dividend yield — % — % Risk-free interest rate 0.78 % 0.57 % Expected life 5 years 5 years The weighted average fair value of options assumed on the date of the Merger was calculated using the Black-Scholes option pricing model. The weighted average fair values on the date of the Merger and assumptions used were as follows: July 1, 2021 Weighted average grant date fair value $ 107.21 Assumptions: Expected volatility 30 % Dividend yield — % Risk-free interest rate 0.56 % Expected life 3.5 years Expected volatility is based on the historical volatility of our common stock over a period equal to the expected term of the options; the expected life represents the weighted average period of time that options granted are expected to be outstanding given consideration to vesting schedules and our historical experience of past vesting and termination patterns. The risk-free rate is based on the U.S. government zero-coupon bonds yield curve in effect at time of the grant for periods corresponding with the expected life of the option. Restricted Share Units and Performance Share Units On April 30 2019, the Company approved the 2019 Consultants and Directors Restricted Share Unit Plan (the “2019 Consultants RSU Plan”), which was effective as of May 16, 2019, pursuant to which the Compensation and Organization Committee of the Company’s Board of Directors may select any consultant, adviser or non-executive Director retained by the Company, or a Subsidiary to receive an award under the plan. 250,000 ordinary shares have been reserved for issuance under the 2019 Consultants RSU Plan. The awards are at par value and vest over a service period. Awards granted to non-executive directors during 2019, 2020 and 2021 vest over twelve months. The Company has awarded RSUs and PSUs to certain key individuals of the Group. The following table summarizes RSU and PSU activity for the nine months ended September 30, 2021: Outstanding at December 31, 2020 159,641 $ 137.64 341,424 $ 145.77 Assumed through business combinations (a) — $ — 589,517 $ 206.71 Granted 55,444 $ 177.77 159,796 $ 210.64 Shares vested (44,132) $ 115.61 (441,328) $ 186.03 Forfeited (4,777) $ 115.61 (48,441) $ 180.74 Outstanding at September 30, 2021 166,176 $ 159.11 600,968 $ 190.56 (a) Represents RSUs issued as replacement awards in connection with the Merger. The fair value of PSUs vested for the nine months ended September 30, 2021 totaled $5.1 million (full year 2020: $5.3 million). The fair value of RSUs vested for the nine months ended September 30, 2021 totaled $82.1 million (full year 2020: $14.3 million). The PSUs vest based on service and specified EPS targets over the periods 2019 – 2021, 2020 – 2022 and 2021 - 2023. Depending on the amount of EPS from 2019 to 2023, up to an additional 83,088 PSUs may also be granted. Non-cash stock compensation expense Non-cash stock compensation expense for the three and nine months ended September 30, 2021 and September 30, 2020 has been allocated as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Direct costs $ 8,787 $ 2,284 $ 13,822 $ 6,472 Selling, general and administrative 17,568 4,687 27,133 13,685 Transaction and integration-related expenses 73,836 — 73,836 — $ 100,191 $ 6,971 $ 114,791 $ 20,157 |
Share capital
Share capital | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Share capital | Share capital The Company can acquire up to 10% of its outstanding ordinary shares (by way of redemption), in accordance with Irish law, the United States securities laws, and the Company’s constitutional documents through open market share acquisitions. On July 1, 2021, the Company completed its Merger with PRA. In accordance with the terms of the Merger Agreement, the Company issued 27,372,427 shares of the Company’s ordinary share capital at par value in exchange for all outstanding PRA shares of common stock. On January 8, 2019, the Company commenced a share buyback program of up to 1.0 million ordinary shares which was completed during the year ended December 31, 2019 for total consideration of $141.6 million. On October 22, 2019, the Company commenced a further share buyback program. At December 31, 2019, 35,100 ordinary shares were redeemed for a total consideration of $5.3 million. During the year ended December 31, 2020, 1,235,218 ordinary shares were redeemed by the Company under this buyback program for a total consideration of $175.0 million. During the nine months ended September 30, 2021 , no ordinary shares were redeemed by the Company under this buyback program. The buyback program gives a broker authority to acquire the Company’s ordinary shares from time to time on the open market in accordance with agreed terms and limitations. All ordinary shares that were redeemed under the buyback program were canceled in accordance with the Constitution of the Company and the nominal value of these shares transferred to other undenominated capital reserve as required under Irish Company Law. |
Business segment information
Business segment information | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
Business segment information | Business segment information The Company determines and presents operating segments based on the information that is internally provided to the chief operating decision maker, the (‘CODM’) in accordance with ASC 280 'Segment Reporting' . The Company determined that the CODM was comprised of the Chief Executive Officer and the Chief Financial Officer. The Company determines and presents operating segments based on the information that is provided to the CODM. The Company operates as one single business segment, which is the provision of outsourced development services on a global basis to the pharmaceutical, biotechnology and medical devices industries. There have been no changes to the basis of segmentation or the measurement basis for the segment results in the period. The Company is a clinical research organization (“CRO”), providing outsourced development services on a global basis to the pharmaceutical, biotechnology and medical device industries. It specializes in the strategic development, management and analysis of programs that support all stages of the clinical development process - from compound selection to Phase I-IV clinical studies. The Company has the expertise and capability to conduct clinical trials in most major therapeutic areas on a global basis and has the operational flexibility to provide development services on a stand-alone basis or as part of an integrated “full service” solution. The Company has expanded through both internal growth and a number of strategic acquisitions to enhance its expertise and capabilities in certain areas of the clinical development process. The Company is generally awarded projects based upon responses to requests for proposals received from companies in the pharmaceutical, biotechnology and medical device industries or work orders executed under our strategic partnership arrangements. Contracts with customers are generally entered into centrally, in most cases with ICON Clinical Research Limited (“ICON Ireland”), the Company’s principal operating subsidiary in Ireland. Revenues, which consist primarily of fees earned under these contracts, are allocated to individual entities within the Group, based on where the work is performed in accordance with the Company’s global transfer pricing model. ICON Ireland acts as the group entrepreneur under the Company’s global transfer pricing model given its role in the development and management of the Group, its ownership of key intellectual property and customer relationships, its key role in the mitigation of risks faced by the Group and its responsibility for maintaining the Company’s global network. ICON Ireland enters into the majority of the Company’s customer contracts. ICON Ireland remunerates other operating entities in the ICON Group on the basis of a guaranteed cost plus mark-up for the services they perform in each of their local territories. The cost plus mark-up for each ICON entity is established to ensure that each of ICON Ireland and the ICON entities that are involved in the conduct of services for customers, earn an appropriate arms-length return having regard to the assets owned, risks borne, and functions performed by each entity from these intercompany transactions. The cost plus mark-up policy is reviewed annually to ensure that it is market appropriate.The integration of entities acquired through the Merger into this global network and global transfer pricing model remains ongoing. The geographic split of revenue disclosed for each region outside Ireland is the cost plus revenue attributable to these entities. The residual revenues of the Group, once each ICON entity has been paid its respective intercompany service fee, generally fall to be retained by ICON Ireland. As such, revenues and income from operations in Ireland are a function of this global transfer pricing model and comprise revenues of the Group after deducting the cost plus revenues attributable to the activities performed outside Ireland. The Company's areas of operation outside of Ireland include the United States, United Kingdom, Austria, Belarus, Belgium, Bulgaria, Croatia, Czechia, Denmark, Finland, France, Georgia, Germany, Greece, Guatemala, Hungary, Italy, Latvia, Lithuania, Norway, Poland, Portugal, Romania, Russia, Serbia, Slovakia, Spain, Sweden, Switzerland, The Netherlands, Turkey, Ukraine, Canada, Argentina, Brazil, Chile, Colombia, Mexico, Peru, China (including Hong Kong), India, Israel, Japan, Malaysia, Singapore, South Korea, The Philippines, Taiwan, Thailand, Australia, New Zealand and South Africa. The geographical distribution of the Company’s segment measures as at September 30, 2021 and December 31, 2020 and for the three and nine months ended September 30, 2021 and September 30, 2020 is as follows: a) The distribution of revenue by geographical area was as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Ireland * $ 358,026 $ 250,230 $ 1,029,877 $ 844,945 Rest of Europe 471,110 100,635 710,043 292,453 U.S. 934,014 285,550 1,599,623 700,483 Rest of World 103,202 65,314 256,162 199,178 Total $ 1,866,352 $ 701,729 $ 3,595,705 $ 2,037,059 * All sales shown for Ireland are export sales. b) The distribution of income/(loss) from operations by geographical area was as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Ireland $ 95,478 $ 81,800 $ 270,126 $ 194,390 Rest of Europe 92,605 4,713 109,009 22,529 U.S. ** (159,704) 14,399 (133,997) 37,667 Rest of World (23,271) 7,489 (11,144) 17,055 Total $ 5,108 $ 108,401 $ 233,994 $ 271,641 ** The U.S geographical area currently includes the full amortization charge associated with the intangible assets acquired in the Merger. Purchase accounting remains provisional at September 30, 2021. c) The distribution of depreciation and amortization by geographical area was as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Ireland $ 9,012 $ 8,330 $ 26,943 $ 24,112 Rest of Europe 3,793 1,631 6,964 4,623 U.S. ** 125,238 5,673 136,322 16,886 Rest of World 2,593 1,167 5,088 3,360 Total $ 140,636 $ 16,801 $ 175,317 $ 48,981 ** The U.S geographical area currently includes the full amortization charge associated with the intangible assets acquired in the Merger. Purchase accounting remains provisional at September 30, 2021. |
Significant accounting polici_2
Significant accounting policies (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Reclassification | Certain prior period amounts in the consolidated financial statements and accompanying notes have been reclassified to conform to the current period’s presentation. Most notably, the Company has presented transaction and integration-related expenses as a separate line in the Condensed Consolidated Statement of Operations and reclassified certain costs incurred in the three and nine months ended September 30, 2020 within this line. These costs consist of transaction and integration-related expenses and contingent consideration valuation adjustments related to ICON's prior period acquisitions. These costs were previously presented in the selling, general and administrative expenses but have been reclassified to transaction and integration-related expenses to conform to the current period’s presentation. |
Revenue recognition | Revenue recognition The Company earns revenues by providing a number of different services to its customers. These services, which are integral elements of the clinical development process, include clinical trials management, consulting, contract staffing, data services and laboratory services. Contracts range in duration from a number of months to several years. ASC 606 requires application of five steps: (1) identify the contract(s) with a customer; (2) identify the performance obligation in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the entity satisfies the performance obligation(s). Clinical trial service revenue A clinical trial service is a single performance obligation satisfied over time, i.e. the full-service obligation in respect of a clinical trial (including those services performed by investigators and other parties) is considered a single performance obligation. Promises offered to the customer are not distinct within the context of the contract. We have concluded that ICON is the contract principal in respect of both direct services and in the use of third parties (principally investigator services) that support the clinical research project. The transaction price is determined by reference to the contract or change order value (total service revenue and pass-through/ reimbursable expenses) adjusted to reflect a realizable contract value. Revenue is recognized as the single performance obligation is satisfied. The progress towards completion for clinical service contracts is measured based on an input measure being total project costs incurred (inclusive of third party costs) at each reporting period as a percentage of forecasted total project costs. Contracting services revenue The Company has availed of the practical expedient which results in recognition of revenue on a right to invoice basis. Application of the practical expedient reflects the right to consideration from the customer in an amount that corresponds directly with the value to the customer of the performance completion to date. This reflects hours performed by contract staff. Consulting services revenue We have concluded that our consulting services contracts represent a single performance obligation satisfied over time. The transaction price is determined by reference to contract or change order value. Revenue is recognized as the performance obligation is satisfied. The progress towards completion for consulting contracts is measured based on total project inputs (time) at each reporting period as a percentage of forecasted total project inputs. Laboratory services revenue Revenue is recognized when, or as, obligations under the terms of a contract are satisfied, which occurs when control of the products or services are transferred to the customer. Revenue for laboratory services is measured as the amount of consideration we expect to receive in exchange for transferring products or services. Where contracts with customers contain multiple performance obligations, the transaction price is allocated to each performance obligation based on the estimated relative selling price of the promised good or service. Service revenue is recognized over time as the services are delivered to the customer based on the extent of progress towards completion of the performance obligation. The determination of the methodology to measure progress requires judgment and is based on the nature of services provided. This requires an assessment of the transfer of value to the customer. The right to invoice measure of progress is generally related to rate per unit contracts, as the extent of progress towards completion is measured based on discrete service or time-based increments, such as samples tested or labor hours incurred. Revenue is recorded in the amount invoiced since that amounts corresponds to the value of the Company's performance and the transfer of value to the customer. Data services revenue The Company provides data reports and analytics to customers based on agreed-upon specifications, including the timing of delivery, which is typically either weekly, monthly, or quarterly. If a customer requests more than one type of data report or series of data reports within a contract, each distinct type of data report is a separate performance obligation. The contracts provide for the Company to be compensated for the value of each deliverable. The transaction price is determined using list prices, discount agreements, if any, and negotiations with the customers, and generally includes any out-of-pocket expenses. Typically, the Company bills in advance of services being provided with the amount being recorded as unearned revenue. When multiple performance obligations exist, the transaction price is allocated to performance obligations on a relative standalone selling price basis. In cases where the Company contracts to provide a series of data reports, or in some cases data, the Company recognizes revenue over time using the “units delivered” output method as the data or reports are delivered. Expense reimbursements are recorded to revenue as the expenses are incurred as they relate directly to the services performed. Certain arrangements include upfront customization or consultative services for customers. These arrangements often include payments based on the achievement of certain contractual milestones. Under these arrangements, the Company contracts with a customer to carry out a specific study, ultimately resulting in delivery of a custom report or data product. These arrangements are a single performance obligation given the integrated nature of the service being provided. The Company typically recognizes revenue under these contracts over time, using an output-based measure, generally time elapsed, to measure progress and transfer of control of the performance obligation to the customer. Expense reimbursements are recorded to revenue as the expenses are incurred as they relate directly to the service performed. The Company enters into contracts with some of its larger data suppliers that involve non-monetary terms. The Company will issue purchase credits to be used toward the data supplier's purchase of the Company's services based on the fair value of the data obtained. In exchange, the Company receives monetary discounts on the data received from the data suppliers. The fair value of the revenue earned from the customer purchases is recognized as services are delivered as described above. At the end of the contract year, any unused customer purchase credits may be forfeited or carried over to the next contract year based on the terms of the data supplier contract. Commissions Incremental costs of obtaining a contract are recognized as an asset on the Condensed Consolidated Balance Sheet in respect of those contracts that exceed one year. Where commission costs relate to contracts that are less than one year, the practical expedient is applied as the amortization period of the asset which would arise on deferral would be one year or less. |
Business combinations and Transaction and integration-related expenses | Business combinations The cost of a business combination is measured as the aggregate of the fair values at the date of exchange of assets given, liabilities incurred or assumed and equity instruments issued in exchange for control. Where a business combination agreement provides for an adjustment to the cost of the acquisition which is contingent upon future events, the amount of the estimated adjustment is recognized at the acquisition date at the fair value of the contingent consideration. Any changes to this estimate outside the measurement period will depend on the classification of the contingent consideration. If the contingent consideration is classified as equity it shall not be re-measured and the settlement shall be accounted for within equity. If the contingent consideration is classified as a liability any adjustments will be accounted for through the Condensed Consolidated Statement of Operations or Other Comprehensive Income depending on whether the liability is considered a financial instrument. The assets, liabilities and contingent liabilities of businesses acquired are measured at their fair values at the date of acquisition. In the case of a business combination which is completed in stages, the fair values of the identifiable assets, liabilities and contingent liabilities are determined at the date of each exchange transaction. When the initial accounting for a business combination is determined provisionally, any subsequent adjustments to the provisional values allocated to the identifiable assets, liabilities and contingent liabilities are made within twelve months of the acquisition date and presented as adjustments to goodwill in the reporting period in which the adjustments are determined. Transaction and integration-related expenses Transaction and integration-related expenses are the incremental costs directly attributable to the completion and integration activities associated with the Company’s recent acquisitions. The costs consist of investment banking fees, advisory costs, retention agreements with employees, accelerated share compensation charges, contingent consideration valuation adjustments and ongoing integration activities. The Company accounts for these transaction and integration-related costs as expenses in the periods in which the costs are incurred and the services are received. |
Debt issuance costs | Debt issuance costs Debt issuance costs relating to the Company’s long-term debt are recorded as a direct reduction of long-term debt; these costs are deferred and amortized to interest expense using the effective interest method, over the respective terms of the related debt. Debt issuance costs relating to the Company’s revolving credit facilities are recorded as an asset; these costs are deferred and amortized to interest expense using the straight-line method. |
Goodwill | GoodwillGoodwill represents the excess of the cost of acquired entities over the net amounts assigned to assets acquired and liabilities assumed. Goodwill primarily comprises acquired workforce in place which does not qualify for recognition as an asset apart from goodwill. Goodwill is stated net of any provision for impairment. |
Intangible assets | Intangible assets Intangible assets are amortized on a straight line basis over their estimated useful life. |
Disclosure of fair value of financial instruments | Disclosure of fair value of financial instruments Cash, cash equivalents, other receivables, available for sale investments, accounts receivable, accounts payable, investigator payments and income taxes payable have carrying amounts that approximate fair value due to the short term maturities of these instruments. Other liabilities' carrying amounts approximate fair value based on net present value of estimated future cash flows. Debt is measured at historical cost. Financial instruments are measured in the Condensed Consolidated Balance Sheets at amortized cost or fair value using a fair value hierarchy of valuation inputs. For financial instruments measured at amortized cost, the fair value of these financial instruments closely approximates their fair value. The fair value hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of three levels, which is determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are: Level 1: Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets. Level 2: Inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3: Inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The Company classifies its investments in short term debt or equity investments as available for sale, as it does not actively trade such securities nor does it intend to hold them to maturity. The fair value of short term investments are represented by level 1 fair value measurements – quoted prices in active markets for identical assets. The unrealized movements in fair value are recognized in equity until disposal or sale, at which time, those unrealized movements from prior periods are recognized in the Condensed Consolidated Statement of Operations. Losses other than temporary, which reduce the carrying amount below cost are recognized in Condensed Consolidated Statement of Operations. |
Share-based compensation | Share-based compensation The Company accounts for its share options, Restricted Share Units ("RSUs") and Performance Share Units ("PSUs") in accordance with the provisions of ASC 718 'Compensation – Stock Compensation'. Share-based compensation expense for equity-settled awards made to employees and directors is measured and recognized based on estimated grant date fair values. These equity-settled awards include employee share options, RSUs and PSUs. Share-based compensation expense for share options awarded to employees and directors is estimated at the grant date based on each option's fair value as calculated using the Black-Scholes option-pricing model. Share-based compensation for RSUs and PSUs awarded to employees and directors is calculated based on the market value of the Company's shares on the date of award of the RSUs and PSUs. The value of awards expected to vest is recognized as an expense over the requisite service periods. We account for forfeitures as they occur. Estimating the grant date fair value of share options as of the grant date using an option-pricing model, such as the Black-Scholes model, is affected by the Company's share price as well as assumptions regarding a number of complex variables. These variables include, but are not limited to, the expected share price volatility over the term of the awards, risk-free interest rates and the expected term of the awards. |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | Revenue disaggregated by customer profile is as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Clients 1-5 525,806 269,460 1,242,446 802,503 Clients 6-10 283,003 89,062 472,788 249,807 Clients 11-25 398,816 118,156 704,312 344,463 Other 658,727 225,051 1,176,159 640,286 Total $ 1,866,352 $ 701,729 $ 3,595,705 $ 2,037,059 Revenue from individual customers greater than 10% of consolidated revenue in the respective periods was as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 Customer: Customer A * 12.4 % * 11.5 % Customer B * * * 10.7 % *Less than 10% |
Accounts receivable, unbilled_2
Accounts receivable, unbilled revenue (contract assets) and unearned revenue or payments on account (contract liabilities) (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Contracts with Customers, Asset and Liabilities | Accounts receivables and unbilled revenue are as follows: September 30, 2021 December 31, 2020 (in thousands) Contract assets: Billed services (accounts receivable) $ 1,345,588 $ 722,420 Unbilled services (unbilled revenue) 550,692 428,684 Accounts receivable and unbilled revenue 1,896,280 1,151,104 Allowance for credit losses (7,262) (7,149) Accounts receivable and unbilled revenue, net $ 1,889,018 $ 1,143,955 Unbilled services and unearned revenue or payments on account (contract assets and liabilities) were as follows: (in thousands, except percentages) September 30, 2021 December 31, 2020 $ Change % Change Unbilled services (unbilled revenue) $ 550,692 $ 428,684 $ 122,008 28.5 % Unearned revenue (payments on account) (1,349,000) (660,883) (688,117) 104.1 % Net balance $ (798,308) $ (232,199) $ (566,109) 243.8 % |
Goodwill (Tables)
Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Nine Months Ended Year Ended September 30, 2021 December 31, 2020 (in thousands) Opening balance $ 936,257 $ 883,170 Current period acquisitions (Note 7) 8,013,878 27,191 Prior period acquisitions — 123 Foreign exchange movement (14,923) 25,773 Closing balance $ 8,935,212 $ 936,257 |
Intangible assets (Tables)
Intangible assets (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets | Intangible assets, net consisted of the following: Nine Months Ended Year Ended September 30, 2021 December 31, 2020 Cost (in thousands) Customer relationships $ 4,047,002 $ 144,251 Order backlog 527,324 39,269 Trade names & brands 204,705 2,766 Patient database 170,513 2,552 Technology assets 121,672 11,173 Total cost 5,071,216 200,011 Accumulated amortization (256,032) (133,551) Net book value $ 4,815,184 $ 66,460 |
Business combinations (Tables)
Business combinations (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The preliminary Merger Date fair value of the consideration transferred consisted of the following: (in thousands) Fair value of cash consideration $ 5,308,646 Fair value of ordinary shares issued to acquiree stockholders 5,658,126 Fair value of replacement share-based awards issued to acquiree employees 209,399 Repayment of term loan obligations and accrued interest * 865,800 $ 12,041,971 * This represents the portion of PRA debt paid by ICON. PRA also paid $401.6 million from available cash to settle debt obligations that existed at the Merger Date. |
Schedule of Summary of Estimates of Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the preliminary allocation of the consideration transferred based on management’s estimates of Merger Date fair values of assets acquired and liabilities assumed, with the excess of the purchase price over the estimated fair values of the identifiable net assets acquired recorded as goodwill: July 1, 2021 (in thousands) Cash and cash equivalents $ 259,971 Accounts receivable and unbilled revenue 934,308 Other current assets 110,691 Fixed assets, net 162,988 Operating lease right-of-use assets 192,345 Goodwill * 8,013,878 Intangible assets, net 4,875,000 Deferred tax assets 172,229 Other assets 35,094 Accounts payable (50,259) Accrued expenses and other current liabilities (342,552) Current portion of operating lease liabilities (38,371) Unearned revenue (758,901) Non-current portion of operating lease liabilities (157,658) Non-current deferred tax liabilities (1,313,599) Other non-current liabilities (53,193) Net assets acquired $ 12,041,971 * The goodwill in connection with the Merger is primarily attributable to the assembled workforce of PRA and the expected synergies of the Merger. None of the goodwill recognized is expected to be deductible for income tax purposes. The following table summarizes the preliminary estimates of the fair value of identified intangible assets and their respective useful lives as of the Merger Date (in thousands, except for estimated useful lives): Estimated Fair Value Estimated Useful Life Customer relationship 3,905,000 23 years Order backlog 489,000 3 years Trade names 202,000 3 years Patient database 168,000 7 years Technology 111,000 5 years 4,875,000 January 22, 2020 (in thousands) Cash & cash equivalents $ 10,170 Property, plant and equipment 45 Operating right of use assets 539 Goodwill * 27,191 Customer relationships 11,725 Order backlog 2,883 Accounts receivable 3,033 Prepayments and other current assets 158 Accounts payable (368) Unearned revenue (989) Other liabilities (2,202) Current lease liabilities (219) Non-current lease liabilities (320) Non-current deferred tax liability (4,090) Net assets acquired $ 47,556 Cash outflows $ 46,992 Working capital adjustment paid 564 Contingent consideration ** — Total consideration $ 47,556 * Goodwill represents the acquisition of an established workforce that specializes in medical device development and market access. None of the goodwill recognized is expected to be deductible for income tax purposes. ** The fair value of the contingent consideration was estimated at the date of acquisition as $Nil. Depending on performance of MedPass for the 12 month period ended December 31, 2020, the total consideration could have increased by a maximum of $6.7 million in contingent consideration. In January 2021, the contingent consideration was finalized and a value of $Nil was payable. |
Business Acquisition, Pro Forma Information | The following pro forma financial information was derived from the historical financial statements of the Company and PRA and presents the combined results of operations as if the Merger had occurred on January 1, 2020. The pro forma financial information is presented for comparative purposes only and is not necessarily indicative of the results that would have actually occurred had the Merger been completed on January 1, 2020. In addition, the pro forma financial information does not give effect to any anticipated cost savings, operating efficiencies or other synergies that may result from the Merger, or any estimated costs that have been or will be incurred by the Company to integrate the assets and operations of PRA. Consequently, actual future results of the Company will differ from the pro forma financial information presented below: Nine months ended Year ended September 30 December 31 2021 2020 (in thousands, except per share data) Revenue $ 5,580,879 $ 5,964,653 Net income/(loss) $ 231,442 $ (151,209) |
Equity method investments (Tabl
Equity method investments (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity method investments | The following table represents our equity method investments at September 30, 2021: Ownership Percentage Carrying Value Carrying Value September 30, 2021 September 30, 2021 December 31, 2020 (in thousands) Oncacare Limited 49 % $ 3,062 $ 4,534 |
Restructuring (Tables)
Restructuring (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Restructuring and Related Activities [Abstract] | |
Details of movement in restructuring charge | Nine Months Ended Year ended September 30, 2021 December 31, 2020 (in thousands) Opening provision $ 10,748 $ 1,637 Additional provisions 6,162 18,089 Utilization (6,802) (9,303) Foreign exchange movement (93) 325 Ending provision $ 10,015 $ 10,748 |
Operating leases (Tables)
Operating leases (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
Schedule of Lease Costs | Lease costs recorded under operating leases for the three and nine months ended September 30, 2021 and September 30, 2020 were as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Operating lease costs $ 18,905 $ 7,417 $ 34,243 $ 23,274 Income from sub-leases (312) (268) (743) (781) Net operating lease costs $ 18,593 $ 7,149 $ 33,500 $ 22,493 |
Schedule of Operating Lease Maturity | Future minimum lease payments under non-cancelable leases as of September 30, 2021 were as follows: Minimum rental payments (in thousands) September 30, 2021 Year 1 $ 67,214 Year 2 55,183 Year 3 36,907 Year 4 24,320 Year 5 20,284 Thereafter 70,292 Total future minimum lease payments 274,200 Lease imputed interest (21,345) Total $ 252,855 |
Non-current bank credit lines_2
Non-current bank credit lines and loan facilities (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | The Company had the following debt outstanding as of September 30, 2021 and December 31, 2020: Principal amount Interest rate as of September 30, December 31, (in thousands) September 30, 2021 2021 2020 Maturity Date Senior Secured Credit Facility Term loan 3.00 % $ 5,501,213 $ — July 2028 Senior Secured Notes 2.875 % 500,000 — July 2026 2020 Senior Notes: Series A notes — 275,000 Series B notes — 75,000 Total debt 6,001,213 350,000 Less current portion of long-term debt (55,150) — Total long-term debt 5,946,063 350,000 Less debt issuance costs and debt discount (73,343) (1,523) Total long-term debt, net $ 5,872,720 $ 348,477 |
Schedule of Maturities of Long-term Debt | As of September 30, 2021, the contractual maturities of the Company's debt obligations were as follows: Current maturities of long-term debt: (in thousands) 2021 (remaining) $ 13,788 2022 55,150 2023 55,150 2024 55,150 2025 and thereafter 5,821,975 Total $ 6,001,213 |
Income taxes (Tables)
Income taxes (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense | Income taxes recognized during the three and nine months ended September 30, 2021 and September 30, 2020, comprise: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Provision for income taxes (excluding restructuring) $ (2,401) $ 13,706 $ 27,880 $ 34,967 Tax impact of restructuring (1,162) — (1,162) (2,261) Provision for income taxes $ (3,563) $ 13,706 $ 26,718 $ 32,706 |
Net income per ordinary share (
Net income per ordinary share (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The reconciliation of the number of shares used in the computation of basic and diluted net income per ordinary share is as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 Weighted average number of ordinary shares outstanding for basic net income per ordinary share 80,771,397 52,737,299 62,264,851 52,885,252 Effect of dilutive share options and other awards outstanding under share based compensation programs — 457,028 831,006 398,428 Weighted average number of ordinary shares outstanding for diluted net income per ordinary share 80,771,397 53,194,327 63,095,857 53,283,680 The reconciliation of net income attributable to the Group and net income attributable to the Group (including NCI redemption amount) as used to calculate net income per ordinary share attributable to the Group is as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Net (loss)/income attributable to the Group $ (94,270) $ 91,641 $ 76,717 $ 231,097 Noncontrolling interest adjustment to redemption amount — — — (4,522) Net income attributable to the Group (including NCI redemption adjustment) $ (94,270) $ 91,641 $ 76,717 $ 226,575 Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 Net income/(loss) per Ordinary Share attributable to the Group (including NCI redemption adjustment): Basic $ (1.17) $ 1.74 $ 1.23 $ 4.28 Diluted $ (1.17) $ 1.72 $ 1.22 $ 4.25 |
Share-based awards (Tables)
Share-based awards (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Share Option Activity | The following table summarizes option activity for the nine months ended September 30, 2021: Options Weighted Weighted Outstanding at December 31, 2020 553,746 $ 108.53 4.86 Assumed through business combinations (a) 2,177,130 $ 108.78 Granted 100,299 $ 177.76 Exercised (913,743) $ 113.87 Canceled/expired (32,784) $ 132.25 Outstanding at September 30, 2021 1,884,648 $ 109.50 5.66 Exercisable at September 30, 2021 1,095,429 $ 90.80 4.72 (a) Represents stock options issued as replacement awards in connection with the Merger. |
Schedule of Weighted Average Fair Values and Assumptions Used | The weighted average grant date fair values and assumptions used were as follows: Nine Months Ended September 30, 2021 September 30, 2020 Weighted average grant date fair value $ 49.15 $ 42.43 Assumptions: Expected volatility 30 % 30 % Dividend yield — % — % Risk-free interest rate 0.78 % 0.57 % Expected life 5 years 5 years July 1, 2021 Weighted average grant date fair value $ 107.21 Assumptions: Expected volatility 30 % Dividend yield — % Risk-free interest rate 0.56 % Expected life 3.5 years |
Schedule of RSU and PSU Activity | The following table summarizes RSU and PSU activity for the nine months ended September 30, 2021: Outstanding at December 31, 2020 159,641 $ 137.64 341,424 $ 145.77 Assumed through business combinations (a) — $ — 589,517 $ 206.71 Granted 55,444 $ 177.77 159,796 $ 210.64 Shares vested (44,132) $ 115.61 (441,328) $ 186.03 Forfeited (4,777) $ 115.61 (48,441) $ 180.74 Outstanding at September 30, 2021 166,176 $ 159.11 600,968 $ 190.56 (a) Represents RSUs issued as replacement awards in connection with the Merger. |
Schedule of Non-cash Stock Compensation Expense | Non-cash stock compensation expense for the three and nine months ended September 30, 2021 and September 30, 2020 has been allocated as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Direct costs $ 8,787 $ 2,284 $ 13,822 $ 6,472 Selling, general and administrative 17,568 4,687 27,133 13,685 Transaction and integration-related expenses 73,836 — 73,836 — $ 100,191 $ 6,971 $ 114,791 $ 20,157 |
Business segment information (T
Business segment information (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
Distribution of Revenue by Geographical Area | The distribution of revenue by geographical area was as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Ireland * $ 358,026 $ 250,230 $ 1,029,877 $ 844,945 Rest of Europe 471,110 100,635 710,043 292,453 U.S. 934,014 285,550 1,599,623 700,483 Rest of World 103,202 65,314 256,162 199,178 Total $ 1,866,352 $ 701,729 $ 3,595,705 $ 2,037,059 |
Distribution of income from operations by geographical area | The distribution of income/(loss) from operations by geographical area was as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Ireland $ 95,478 $ 81,800 $ 270,126 $ 194,390 Rest of Europe 92,605 4,713 109,009 22,529 U.S. ** (159,704) 14,399 (133,997) 37,667 Rest of World (23,271) 7,489 (11,144) 17,055 Total $ 5,108 $ 108,401 $ 233,994 $ 271,641 ** The U.S geographical area currently includes the full amortization charge associated with the intangible assets acquired in the Merger. Purchase accounting remains provisional at September 30, 2021. |
Distribution of Depreciation and Amortization by Geographical Area | The distribution of depreciation and amortization by geographical area was as follows: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 (in thousands) (in thousands) Ireland $ 9,012 $ 8,330 $ 26,943 $ 24,112 Rest of Europe 3,793 1,631 6,964 4,623 U.S. ** 125,238 5,673 136,322 16,886 Rest of World 2,593 1,167 5,088 3,360 Total $ 140,636 $ 16,801 $ 175,317 $ 48,981 ** The U.S geographical area currently includes the full amortization charge associated with the intangible assets acquired in the Merger. Purchase accounting remains provisional at September 30, 2021. |
Revenue (Details)
Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 1,866,352 | $ 701,729 | $ 3,595,705 | $ 2,037,059 |
Clients 1-5 | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 525,806 | 269,460 | 1,242,446 | 802,503 |
Clients 6-10 | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 283,003 | 89,062 | 472,788 | 249,807 |
Clients 11-25 | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 398,816 | 118,156 | 704,312 | 344,463 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 658,727 | $ 225,051 | $ 1,176,159 | $ 640,286 |
Customer A | Customer concentration risk | Revenue benchmark | ||||
Disaggregation of Revenue [Line Items] | ||||
Customer concentration risk | 12.40% | 11.50% | ||
Customer B | Customer concentration risk | Revenue benchmark | ||||
Disaggregation of Revenue [Line Items] | ||||
Customer concentration risk | 10.70% |
Accounts receivable, unbilled_3
Accounts receivable, unbilled revenue (contract assets) and unearned revenue or payments on account (contract liabilities) - Contract Assets and Liabilities (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | ||
Billed services (accounts receivable) | $ 1,345,588 | $ 722,420 |
Unbilled services (unbilled revenue) | 550,692 | 428,684 |
Accounts receivable and unbilled revenue | 1,896,280 | 1,151,104 |
Allowance for credit losses | (7,262) | (7,149) |
Accounts receivable and unbilled revenue, net | 1,889,018 | 1,143,955 |
Change in unbilled services (unbilled revenue) | $ 122,008 | |
Percentage change in unbilled services (unbilled revenue) | 28.50% | |
Unearned revenue (payments on account) | $ (1,349,000) | (660,883) |
Change in unearned revenue (payments on account) | $ (688,117) | |
Percentage change in unearned revenue (payments on account) | 104.10% | |
Net balance | $ (798,308) | $ (232,199) |
Change in net balance | $ (566,109) | |
Percentage change in net balance | 243.80% |
Accounts receivable, unbilled_4
Accounts receivable, unbilled revenue (contract assets) and unearned revenue or payments on account (contract liabilities) - Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Increase in unbilled services (unbilled revenue) | $ 122,008 | |
Increase in unearned revenue (payments on account) | 688,117 | |
Decrease in net balance | 566,109 | |
Revenue, remaining performance obligation | $ 13,000,000 | $ 6,100,000 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, remaining performance obligation percentage | 49.00% | |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 12 months |
Goodwill (Details)
Goodwill (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Goodwill [Roll Forward] | ||
Opening balance | $ 936,257,000 | $ 883,170,000 |
Current period acquisitions (Note 7) | 8,013,878,000 | 27,191,000 |
Prior period acquisitions | 0 | 123,000 |
Foreign exchange movement | (14,923,000) | 25,773,000 |
Closing balance | 8,935,212,000 | 936,257,000 |
Accumulated impairment loss | $ 0 | $ 0 |
Intangible assets (Details)
Intangible assets (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Finite-Lived Intangible Assets [Line Items] | ||
Total cost | $ 5,071,216 | $ 200,011 |
Accumulated amortization | (256,032) | (133,551) |
Net book value | 4,815,184 | 66,460 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total cost | 4,047,002 | 144,251 |
Order backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total cost | 527,324 | 39,269 |
Trade names & brands | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total cost | 204,705 | 2,766 |
Patient database | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total cost | 170,513 | 2,552 |
Technology assets | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total cost | $ 121,672 | $ 11,173 |
Business combinations - Narrati
Business combinations - Narrative (Details) $ / shares in Units, $ in Thousands | Jul. 01, 2021EmployeeCountry$ / sharesshares | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Jan. 22, 2020 |
Business Acquisition [Line Items] | ||||||
Entity number of employees | Employee | 37,960 | |||||
Number of countries in which entity operates | Country | 53 | |||||
Transaction and integration-related expenses | $ 149,791 | $ 402 | $ 182,309 | $ (497) | ||
PRA Health Sciences Inc | ||||||
Business Acquisition [Line Items] | ||||||
Business acquisition, share price (in USD per share) | $ / shares | $ 80 | |||||
Business acquisition, number of shares issued (in shares) | shares | 0.4125 | |||||
Transaction and integration-related expenses | 182,300 | |||||
Interest expense | 78,200 | |||||
Deferred financing cost | 76,200 | $ 76,200 | ||||
Revenue of acquiree since acquisition date | 1,019,700 | |||||
Net income of acquiree since acquisition date | $ 113,400 | |||||
Medpass | ||||||
Business Acquisition [Line Items] | ||||||
Percentage of share capital acquired | 100.00% |
Business combinations - Fair Va
Business combinations - Fair Value of PRA Health Sciences Inc Acquisition Consideration (Details) - USD ($) $ in Thousands | Jul. 01, 2021 | Sep. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 |
Business Acquisition [Line Items] | ||||
Fair value of cash consideration | $ 5,914,475 | $ 37,761 | ||
Fair value of replacement share-based awards issued to acquiree employees | $ 209,399 | |||
PRA Health Sciences Inc | ||||
Business Acquisition [Line Items] | ||||
Fair value of cash consideration | $ 5,308,646 | |||
Fair value of ordinary shares issued to acquiree stockholders | 5,658,126 | |||
Fair value of replacement share-based awards issued to acquiree employees | 209,399 | |||
Repayment of term loan obligations and accrued interest | 865,800 | |||
Total consideration | 12,041,971 | |||
Repayments of assumed debt obligtaions | $ 401,600 |
Business combinations - Schedul
Business combinations - Schedule of PRA Health Sciences Inc Acquisition (Details) - USD ($) | Sep. 30, 2021 | Jul. 01, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 8,935,212,000 | $ 936,257,000 | $ 883,170,000 | |
PRA Health Sciences Inc | ||||
Business Acquisition [Line Items] | ||||
Cash & cash equivalents | $ 259,971,000 | |||
Accounts receivable and unbilled revenue | 934,308,000 | |||
Other current assets | 110,691,000 | |||
Fixed assets, net | 162,988,000 | |||
Operating lease right-of-use assets | 192,345,000 | |||
Goodwill | 8,013,878,000 | |||
Intangible assets, net | 4,875,000,000 | |||
Deferred tax assets | 172,229,000 | |||
Other assets | 35,094,000 | |||
Accounts payable | (50,259,000) | |||
Accrued expenses and other current liabilities | (342,552,000) | |||
Current lease liabilities | (38,371,000) | |||
Unearned revenue | (758,901,000) | |||
Non-current lease liabilities | (157,658,000) | |||
Non-current deferred tax liability | (1,313,599,000) | |||
Other non-current liabilities | (53,193,000) | |||
Net assets acquired | 12,041,971,000 | |||
Goodwill expected to be tax deductible | $ 0 |
Business combinations - Sched_2
Business combinations - Schedule of Fair Value of Intangible Assets PRA Health Sciences Inc Acquisition (Details) - PRA Health Sciences Inc $ in Thousands | Jul. 01, 2021USD ($) |
Business Acquisition [Line Items] | |
Estimated Fair Value | $ 4,875,000 |
Customer relationships | |
Business Acquisition [Line Items] | |
Estimated Fair Value | $ 3,905,000 |
Estimated Useful Life | 23 years |
Order backlog | |
Business Acquisition [Line Items] | |
Estimated Fair Value | $ 489,000 |
Estimated Useful Life | 3 years |
Trade names | |
Business Acquisition [Line Items] | |
Estimated Fair Value | $ 202,000 |
Estimated Useful Life | 3 years |
Patient database | |
Business Acquisition [Line Items] | |
Estimated Fair Value | $ 168,000 |
Estimated Useful Life | 7 years |
Technology assets | |
Business Acquisition [Line Items] | |
Estimated Fair Value | $ 111,000 |
Estimated Useful Life | 5 years |
Business combinations - Sched_3
Business combinations - Schedule of Proforma effect of PRA Health Sciences Inc Acquisition (Details) - PRA Health Sciences Inc - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | ||
Revenue | $ 5,580,879 | $ 5,964,653 |
Net income/(loss) | $ 231,442 | $ (151,209) |
Business combinations - Sched_4
Business combinations - Schedule of MedPass Group Acquisition (Details) - USD ($) | Jan. 22, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Jan. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | ||||||
Goodwill | $ 8,935,212,000 | $ 936,257,000 | $ 883,170,000 | |||
Cash outflows | $ 5,914,475,000 | $ 37,761,000 | ||||
Medpass | ||||||
Business Acquisition [Line Items] | ||||||
Cash & cash equivalents | $ 10,170,000 | |||||
Property, plant and equipment | 45,000 | |||||
Operating right of use assets | 539,000 | |||||
Goodwill | 27,191,000 | |||||
Accounts receivable | 3,033,000 | |||||
Prepayments and other current assets | 158,000 | |||||
Accounts payable | (368,000) | |||||
Unearned revenue | (989,000) | |||||
Other liabilities | (2,202,000) | |||||
Current lease liabilities | (219,000) | |||||
Non-current lease liabilities | (320,000) | |||||
Non-current deferred tax liability | (4,090,000) | |||||
Net assets acquired | 47,556,000 | |||||
Cash outflows | 46,992,000 | |||||
Working capital adjustment paid | (564,000) | |||||
Contingent consideration | 0 | $ 0 | ||||
Total consideration | 47,556,000 | |||||
Goodwill expected to be tax deductible | 0 | |||||
Contingent consideration, maximum amount | 6,700,000 | |||||
Customer relationships | Medpass | ||||||
Business Acquisition [Line Items] | ||||||
Customer relationships/ Order backlog | 11,725,000 | |||||
Order backlog | Medpass | ||||||
Business Acquisition [Line Items] | ||||||
Customer relationships/ Order backlog | $ 2,883,000 |
Equity method investments (Deta
Equity method investments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Jul. 24, 2020 | |
Equity Method Investments and Joint Ventures [Abstract] | ||||||
Oncacare Limited | $ 3,062 | $ 3,062 | $ 4,534 | $ 4,900 | ||
Equity method investment, ownership percentage | 49.00% | 49.00% | ||||
Equity method investment, majority ownership percentage | 51.00% | 51.00% | ||||
Equity method investment, period majority voting share capital can be sold to the company | 2 years 6 months | |||||
Loss from equity method investments | $ 688 | $ 83 | $ 1,471 | $ 83 |
Fair value measurements (Detail
Fair value measurements (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments in equity-long term | $ 22,758 | $ 15,765 |
Fair value, recurring | Fair value, inputs, level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments at fair value | 22,800 | $ 15,800 |
Fair value, nonrecurring | Fair value, inputs, level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets at fair value | 13,750,400 | |
Goodwill at fair value | 8,935,200 | |
Net intangible assets at fair value | $ 4,815,200 |
Restructuring - Rollforward Act
Restructuring - Rollforward Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Restructuring Reserve [Roll Forward] | |||||
Opening provision | $ 10,748 | $ 1,637 | $ 1,637 | ||
Additional provisions | $ 6,162 | $ 0 | 6,162 | $ 18,089 | 18,089 |
Utilization | (6,802) | (9,303) | |||
Foreign exchange movement | (93) | 325 | |||
Ending provision | $ 10,015 | $ 10,015 | $ 10,748 |
Restructuring - Narrative (Deta
Restructuring - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring | $ 6,162 | $ 0 | $ 6,162 | $ 18,089 | $ 18,089 | |
Impairment of right-of-use assets | 5,731 | $ 5,411 | ||||
Provision balance | 10,015 | 10,015 | $ 10,748 | $ 1,637 | ||
Office consolidation | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Provision balance | 8,900 | 8,900 | ||||
Other liabilities | Office consolidation | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Provision balance | 4,800 | 4,800 | ||||
Other liabilities | Employee severance | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Provision balance | 1,100 | 1,100 | ||||
Non-current operating lease liabilities | Office consolidation | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Provision balance | $ 4,100 | $ 4,100 |
Operating leases - Lease Costs
Operating leases - Lease Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Leases [Abstract] | ||||
Operating lease costs | $ 18,905 | $ 7,417 | $ 34,243 | $ 23,274 |
Income from sub-leases | (312) | (268) | (743) | (781) |
Net operating lease costs | $ 18,593 | $ 7,149 | $ 33,500 | $ 22,493 |
Operating leases - Narrative (D
Operating leases - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Lessee, Lease, Description [Line Items] | |||||
Total lease cost | $ 18,593 | $ 7,149 | $ 33,500 | $ 22,493 | |
Early termination options reasonably certain to be exercised | 0 | 0 | 4,200 | 1,600 | |
Right-of-use assets obtained in exchange for lease obligations | $ 1,100 | 5,300 | 4,900 | 8,200 | |
Impairment of right-of-use assets | $ 5,731 | 5,411 | |||
Weighted average remaining lease term | 6 years 11 months 8 days | 6 years 11 months 8 days | |||
Weighted average discount rate | 2.16% | 2.16% | |||
Operating lease liabilities | $ 61,900 | $ 24,300 | $ 61,900 | 24,300 | |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Other liabilities | Other liabilities | Other liabilities | ||
Selling, general and administration costs | |||||
Lessee, Lease, Description [Line Items] | |||||
Total lease cost | $ 31,900 | 20,600 | |||
Direct costs | |||||
Lessee, Lease, Description [Line Items] | |||||
Total lease cost | $ 1,600 | $ 1,900 |
Operating leases - Operating Le
Operating leases - Operating Lease Maturity (Details) $ in Thousands | Sep. 30, 2021USD ($) |
Leases [Abstract] | |
Year 1 | $ 67,214 |
Year 2 | 55,183 |
Year 3 | 36,907 |
Year 4 | 24,320 |
Year 5 | 20,284 |
Thereafter | 70,292 |
Total future minimum lease payments | 274,200 |
Lease imputed interest | (21,345) |
Total | $ 252,855 |
Non-current bank credit lines_3
Non-current bank credit lines and loan facilities - Schedule of Outstanding Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Jul. 01, 2021 | Dec. 31, 2020 | Dec. 08, 2020 |
Debt Instrument [Line Items] | ||||
Total debt | $ 6,001,213 | $ 350,000 | ||
Less current portion of long-term debt | (55,150) | 0 | ||
Total long-term debt | 5,946,063 | 350,000 | ||
Less debt issuance costs and debt discount | (73,343) | (1,523) | ||
Total long-term debt, net | $ 5,872,720 | 348,477 | ||
Secured debt | Term loan | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, interest rate at period end | 3.00% | |||
Debt instrument, interest rate as of period end | 1.00% | |||
Total debt | $ 5,501,213 | 0 | ||
Senior Secured Notes | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, interest rate as of period end | 2.875% | |||
Senior Secured Notes | Senior Secured Notes | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, interest rate as of period end | 2.875% | |||
Total debt | $ 500,000 | 0 | ||
2020 Senior Notes | Series A notes | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, interest rate as of period end | 2.32% | |||
Total debt | 0 | 275,000 | $ 275,000 | |
2020 Senior Notes | Series B notes | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, interest rate as of period end | 2.43% | |||
Total debt | $ 0 | $ 75,000 |
Non-current bank credit lines_4
Non-current bank credit lines and loan facilities - Narrative (Details) | Sep. 27, 2021USD ($) | Jul. 01, 2021USD ($) | Dec. 08, 2020USD ($)tranche | Sep. 30, 2021USD ($) | Dec. 31, 2020USD ($) |
Debt Instrument [Line Items] | |||||
Total debt | $ 6,001,213,000 | $ 350,000,000 | |||
Number of tranches | tranche | 2 | ||||
Debt at fair value | 6,035,100,000 | ||||
Senior Secured Notes | |||||
Debt Instrument [Line Items] | |||||
Amortization rate of debt instrument | 2.875% | ||||
Term loan | |||||
Debt Instrument [Line Items] | |||||
Repayments of secured debt | $ 13,800,000 | ||||
Term loan | Secured debt | |||||
Debt Instrument [Line Items] | |||||
Debt discount | 27,600,000 | ||||
Line of credit facility, principal amount | $ 5,515,000,000 | ||||
Amortization rate of debt instrument | 1.00% | ||||
Total debt | 5,501,213,000 | 0 | |||
Periodic interest payment | $ 40,400,000 | ||||
Term loan | Secured debt | Variable rate component one | Base rate | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 1.50% | ||||
Term loan | Secured debt | Variable rate component two | |||||
Debt Instrument [Line Items] | |||||
First lien net leverage ratio | 4 | ||||
Term loan | Secured debt | Variable rate component two | London Interbank Offered Rate (LIBOR) | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 2.50% | ||||
Variable rate, step down percentage | 0.25% | ||||
Variable rate floor percentage | 0.50% | ||||
Revolving loan facility | Line of credit | Revolving loan facility | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, principal amount | $ 300,000,000 | ||||
Total debt | $ 0 | ||||
Revolving loan facility | Line of credit | Revolving loan facility | Variable rate component one | Base rate | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 0.60% | ||||
Revolving loan facility | Line of credit | Revolving loan facility | Variable rate component one | Base rate | Minimum | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 1.00% | ||||
Revolving loan facility | Line of credit | Revolving loan facility | Variable rate component one | Base rate | Maximum | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 0.25% | ||||
Revolving loan facility | Line of credit | Revolving loan facility | Variable rate component two | London Interbank Offered Rate (LIBOR) | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 1.60% | ||||
Revolving loan facility | Line of credit | Revolving loan facility | Variable rate component two | London Interbank Offered Rate (LIBOR) | Minimum | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 2.00% | ||||
Revolving loan facility | Line of credit | Revolving loan facility | Variable rate component two | London Interbank Offered Rate (LIBOR) | Maximum | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 1.25% | ||||
Senior Secured Notes | Senior Secured Notes | |||||
Debt Instrument [Line Items] | |||||
Amortization rate of debt instrument | 2.875% | ||||
Total debt | $ 500,000,000 | 0 | |||
Debt instrument, principal amount | $ 500,000,000 | ||||
Senior Notes 2020 | 2020 Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, principal amount | $ 350,000,000 | ||||
Effective interest rate | 2.41% | ||||
Repayments of long-term debt | $ 364,000,000 | ||||
Series A notes | 2020 Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Amortization rate of debt instrument | 2.32% | ||||
Total debt | $ 275,000,000 | 0 | 275,000,000 | ||
Series B notes | 2020 Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Amortization rate of debt instrument | 2.43% | ||||
Total debt | $ 0 | $ 75,000,000 | |||
Debt instrument, principal amount | $ 75,000,000 |
Non-current bank credit lines_5
Non-current bank credit lines and loan facilities - Schedule of Contractual Maturities of Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Debt Disclosure [Abstract] | ||
2021 (remaining) | $ 13,788 | |
2022 | 55,150 | |
2023 | 55,150 | |
2024 | 55,150 | |
2025 and thereafter | 5,821,975 | |
Total debt | $ 6,001,213 | $ 350,000 |
Income taxes - Income Taxes Rec
Income taxes - Income Taxes Recognized During Period (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | ||||
Provision for income taxes (excluding restructuring) | $ (2,401) | $ 13,706 | $ 27,880 | $ 34,967 |
Tax impact of restructuring | (1,162) | 0 | (1,162) | (2,261) |
Provision for income taxes | $ (3,563) | $ 13,706 | $ 26,718 | $ 32,706 |
Income taxes - Narrative (Detai
Income taxes - Narrative (Details) - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Income Tax Disclosure [Abstract] | ||
Liability for unrecognized tax benefit | $ 59.8 | $ 19.6 |
Items generating unrecognized tax benefits | 55.4 | 19.1 |
Interest and related penalties | $ 4.4 | $ 0.5 |
Net income per ordinary share -
Net income per ordinary share - Reconciliation of Number of Shares Used in Computation of Basic and Diluted Net Income Per Ordinary Share (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Earnings Per Share [Abstract] | ||||
Weighted average number of ordinary shares outstanding for basic net income per ordinary share (in shares) | 80,771,397 | 52,737,299 | 62,264,851 | 52,885,252 |
Effect of dilutive share options and other awards outstanding under share based compensation programs (in shares) | 0 | 457,028 | 831,006 | 398,428 |
Weighted average number of ordinary shares outstanding for diluted net income per ordinary share (in shares) | 80,771,397 | 53,194,327 | 63,095,857 | 53,283,680 |
Net income per ordinary share_2
Net income per ordinary share - Reconciliation of Net Income Attributable to the Group and Net Income Attributable To the Group (Including NCI Redemption Amount) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Earnings Per Share [Abstract] | ||||||||
Net (loss)/income attributable to the Group | $ (94,270) | $ 73,865 | $ 97,122 | $ 91,641 | $ 47,760 | $ 91,696 | $ 76,717 | $ 231,097 |
Noncontrolling interest adjustment to redemption amount | 0 | 0 | 0 | (4,522) | ||||
Net income attributable to the Group (including NCI redemption adjustment) | $ (94,270) | $ 91,641 | $ 76,717 | $ 226,575 | ||||
Net income/(loss) per Ordinary Share attributable to the Group (including NCI redemption adjustment): | ||||||||
Basic (USD per share) | $ (1.17) | $ 1.74 | $ 1.23 | $ 4.28 | ||||
Diluted (USD per share) | $ (1.17) | $ 1.72 | $ 1.22 | $ 4.25 | ||||
Diluted shares adjustment if in profit position (in shares) | 1,521,890 |
Share-based awards - Summary of
Share-based awards - Summary of Stock Option Activity (Details) - Employee Stock Option | Sep. 30, 2021$ / sharesshares | Dec. 31, 2020$ / sharesshares | Sep. 30, 2021$ / sharesshares |
Options Outstanding Number of Shares | |||
Outstanding at beginning of period (in shares) | shares | 553,746 | ||
Assumed through business combinations (in shares) | shares | 2,177,130 | ||
Granted (in shares) | shares | 100,299 | ||
Exercised (in shares) | shares | (913,743) | ||
Canceled/expired (in shares) | shares | (32,784) | ||
Outstanding at end of period (in shares) | shares | 1,884,648 | 553,746 | 1,884,648 |
Exercisable at end of period (in shares) | shares | 1,095,429 | 1,095,429 | |
Weighted Average Exercise Price | |||
Outstanding at beginning of period (USD per share) | $ / shares | $ 108.53 | ||
Assumed through business combinations (in USD per share) | $ / shares | 108.78 | ||
Granted (USD per share) | $ / shares | 177.76 | ||
Exercised (USD per share) | $ / shares | 113.87 | ||
Canceled/expired (USD per share) | $ / shares | 132.25 | ||
Outstanding at end of period (USD per share) | $ / shares | $ 109.50 | $ 108.53 | 109.50 |
Exercisable at end of period (USD per share) | $ / shares | $ 90.80 | $ 90.80 | |
Weighted Average Remaining Contractual Life | |||
Outstanding at end of period | 5 years 7 months 28 days | 4 years 10 months 9 days | |
Exercisable at end of period | 4 years 8 months 19 days |
Share-based awards - Narrative
Share-based awards - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | Sep. 30, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | May 16, 2019 |
Employee Stock Option | ||||
Compensation Related Costs Share Based Payments Disclosure [Line Items] | ||||
Exercisable - number of shares (in shares) | 1,095,429 | 1,095,429 | ||
Exercisable - weighted average remaining contractual life | 4 years 8 months 19 days | |||
Exercisable - weighted average exercise price (USD per share) | $ 90.80 | $ 90.80 | ||
Consultants Restricted Stock Units 2019 | ||||
Compensation Related Costs Share Based Payments Disclosure [Line Items] | ||||
Ordinary shares which have been reserved for issuance (in shares) | 250,000 | |||
Consultants Restricted Stock Units 2019 | Non-executive directors | ||||
Compensation Related Costs Share Based Payments Disclosure [Line Items] | ||||
Shares vesting period | 12 months | |||
Performance Share Unit (PSUs) | ||||
Compensation Related Costs Share Based Payments Disclosure [Line Items] | ||||
Fair value of stock units vested | $ 5.1 | $ 5.3 | ||
Restricted Stock Units (RSUs) | ||||
Compensation Related Costs Share Based Payments Disclosure [Line Items] | ||||
Fair value of stock units vested | $ 82.1 | $ 14.3 | ||
PSUs Based on Service and EPS Targets | Maximum | ||||
Compensation Related Costs Share Based Payments Disclosure [Line Items] | ||||
Stock units to be granted (in shares) | 83,088 | 83,088 |
Share-based awards - Schedule o
Share-based awards - Schedule of Weighted Average Fair Values and Assumptions Used (Details) - Employee Stock Option - $ / shares | Sep. 30, 2021 | Jul. 01, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Weighted average grant date fair value | $ 107.21 | $ 49.15 | $ 42.43 | ||
Assumptions: | |||||
Expected volatility | 30.00% | 30.00% | 30.00% | ||
Dividend yield | 0.00% | 0.00% | 0.00% | ||
Risk-free interest rate | 0.56% | 0.78% | 0.57% | ||
Expected life | 5 years | 3 years 6 months | 5 years |
Share-based awards - Summary _2
Share-based awards - Summary of RSU and PSU Activity (Details) | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Performance Share Unit (PSUs) | |
Outstanding Number of Shares | |
Outstanding at beginning of period (in shares) | shares | 159,641 |
Assumed through business combinations (in shares) | shares | 0 |
Granted (in shares) | shares | 55,444 |
Shares vested (in shares) | shares | (44,132) |
Forfeited (in shares) | shares | (4,777) |
Outstanding at end of period (in shares) | shares | 166,176 |
Weighted Average Grant Date Fair Value | |
Outstanding at beginning of period (USD per share) | $ / shares | $ 137.64 |
Assumed through business combinations (in USD per share) | $ / shares | 0 |
Granted (USD per share) | $ / shares | 177.77 |
Shares vested (USD per share) | $ / shares | 115.61 |
Forfeited (USD per share) | $ / shares | 115.61 |
Outstanding at end of period (USD per share) | $ / shares | $ 159.11 |
Restricted Stock Units (RSUs) | |
Outstanding Number of Shares | |
Outstanding at beginning of period (in shares) | shares | 341,424 |
Assumed through business combinations (in shares) | shares | 589,517 |
Granted (in shares) | shares | 159,796 |
Shares vested (in shares) | shares | (441,328) |
Forfeited (in shares) | shares | (48,441) |
Outstanding at end of period (in shares) | shares | 600,968 |
Weighted Average Grant Date Fair Value | |
Outstanding at beginning of period (USD per share) | $ / shares | $ 145.77 |
Assumed through business combinations (in USD per share) | $ / shares | 206.71 |
Granted (USD per share) | $ / shares | 210.64 |
Shares vested (USD per share) | $ / shares | 186.03 |
Forfeited (USD per share) | $ / shares | 180.74 |
Outstanding at end of period (USD per share) | $ / shares | $ 190.56 |
Share-based awards - Schedule_2
Share-based awards - Schedule of Non-cash Stock Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock compensation expense | $ 100,191 | $ 6,971 | $ 114,791 | $ 20,157 |
Direct costs | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock compensation expense | 8,787 | 2,284 | 13,822 | 6,472 |
Selling, general and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock compensation expense | 17,568 | 4,687 | 27,133 | 13,685 |
Transaction and integration-related expenses | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock compensation expense | $ 73,836 | $ 0 | $ 73,836 | $ 0 |
Share capital (Details)
Share capital (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Sep. 30, 2021 | Mar. 31, 2020 | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Jan. 08, 2019 |
Equity, Class of Treasury Stock [Line Items] | |||||||
Share repurchase program | $ 175,000 | ||||||
Ordinary Shares | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Issue of shares associated with a business combination (in shares) | 27,372,427 | ||||||
Share repurchase program | $ 82 | ||||||
Shares redeemed (in shares) | 1,235,218 | ||||||
Buyback Program | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Share repurchase program, number of shares authorized to be repurchased (in shares) | 1,000,000 | ||||||
Share repurchase program | $ 5,300 | $ 175,000 | $ 141,600 | ||||
Shares redeemed (in shares) | 35,100 | 0 | 1,235,218 | ||||
Buyback Program | Maximum | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Share repurchase program, authorized percentage | 10.00% |
Business segment information -
Business segment information - Narrative (Details) | 9 Months Ended |
Sep. 30, 2021segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 1 |
Business segment information _2
Business segment information - Distribution of Revenue by Geographical Area (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Segment Reporting Information [Line Items] | ||||
Revenue | $ 1,866,352 | $ 701,729 | $ 3,595,705 | $ 2,037,059 |
Ireland | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 358,026 | 250,230 | 1,029,877 | 844,945 |
Rest of Europe | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 471,110 | 100,635 | 710,043 | 292,453 |
U.S. | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 934,014 | 285,550 | 1,599,623 | 700,483 |
Rest of World | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 103,202 | $ 65,314 | $ 256,162 | $ 199,178 |
Business segment information _3
Business segment information - Distribution of Income from Operations, Including Restructuring, by Geographical Area (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Segment Reporting Information [Line Items] | ||||
Income from operations, including restructuring | $ 5,108 | $ 108,401 | $ 233,994 | $ 271,641 |
Ireland | ||||
Segment Reporting Information [Line Items] | ||||
Income from operations, including restructuring | 95,478 | 81,800 | 270,126 | 194,390 |
Rest of Europe | ||||
Segment Reporting Information [Line Items] | ||||
Income from operations, including restructuring | 92,605 | 4,713 | 109,009 | 22,529 |
U.S. | ||||
Segment Reporting Information [Line Items] | ||||
Income from operations, including restructuring | (159,704) | 14,399 | (133,997) | 37,667 |
Rest of World | ||||
Segment Reporting Information [Line Items] | ||||
Income from operations, including restructuring | $ (23,271) | $ 7,489 | $ (11,144) | $ 17,055 |
Business segment information _4
Business segment information - Distribution of Depreciation and Amortization by Geographical Area (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization expense | $ 140,636 | $ 16,801 | $ 175,317 | $ 48,981 |
Ireland | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization expense | 9,012 | 8,330 | 26,943 | 24,112 |
Rest of Europe | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization expense | 3,793 | 1,631 | 6,964 | 4,623 |
U.S. | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization expense | 125,238 | 5,673 | 136,322 | 16,886 |
Rest of World | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization expense | $ 2,593 | $ 1,167 | $ 5,088 | $ 3,360 |