Icon Clinical shares dip on Q4 results

By Phil Taylor

- Last updated on GMT

Related tags: Stock market

Contract research firm Icon Clinical saw its revenues advance by nearly 22 per cent in the last quarter of 2008, but still saw its share price slide as investors got the jitters over the firm’s cautious predictions for 2009.

Fourth-quarter revenues came in at $220m and represented something of a slowdown for Icon’s business as revenues for the full-year were ahead by 37 per cent to $865m. Operating income was up 34 per cent to $26.5m for the quarter and 44 per cent for the year.

Icon’s chairman, Dr. John Climax, described 2008 as an “outstanding year,” adding that it was the second year in a row that the firm had put in growth of that magnitude.

But chief executive Peter Gray sounded a cautious note: “With our backlog at $1.74bn we have entered 2009 in a good position, although the difficult economic climate has put some customers under pressure and has created a degree of uncertainty​.”

Those comments – referring to an increasing tendency by trial sponsors to delay or even cancel contracts in light of the economic downturn - are in line with just about all of Icon’s peers in their further-quarter statements.

The backlog figure also provides some indication that Icon is being affected by the slowdown. It is currently running at around three quarters of forecast 12-month revenues, and that is the lowest proportion at Icon since August 2005.

Icon shares dipped 9 per cent on the Nasdaq on the day the results were announced (Feb 23) to close at $21.42 – but have since regained some of that territory, closing at $22.26 yesterday.

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