01—Abstract
Summary
Summary of the 10-K/A filed February 21, 2014. Cited figures are marked; the original filing is the authoritative source.
This Amendment No. 1 to the Form 10-K of Quintiles Transnational Holdings Inc. (for the year ended December 31, 2013, originally filed February 13, 2014) was filed to present the Part III information required by the Form 10-K: directors and executive officers, executive compensation, security ownership, related person transactions, and principal accountant fees.
The amendment also restates the signature page, Section 302 certifications, and Item 15 with the Exhibit Index. It states that no financial statements are contained in the amendment and that the financial statements were included in the original Form 10-K. The compensation disclosures show that 2013 was the company's IPO year, completed in May 2013 with the stock listed on the NYSE under the symbol "Q." The filing reports service revenues of $3.8 billiona, revenue growth of $116.0 million year over year, and diluted earnings per share of $1.77 compared with $1.51 in 2012.
The management incentive plan bonus pool was $171.6 millionb, funded from an operating surplus of $742.9 million at a fixed exchange rate, which was 113.1% of a $656.9 million target. Ownership is concentrated: parties to the Shareholders Agreement (Dr. Gillings, Bain Capital, the TPG Funds, and 3i) collectively beneficially owned 64.9% of the 129,922,407 shares outstanding as of February 18, 2014. The company also reports that PricewaterhouseCoopers LLP billed total fees of $5,157 thousand for 2013, of which $4,990 thousand was audit fees.
02—Key points
Key Highlights
- Service revenues of $3.8 billion in 2013, up $116.0 million year over year; diluted EPS of $1.77 versus $1.51 in 2012.
- The company completed its IPO in May 2013 and listed on the NYSE under the symbol "Q."
- The 2013 management incentive plan bonus pool was $171.6 million, based on operating surplus of $742.9 million (fixed exchange rate), or 113.1% of the $656.9 million target.
- The parties to the Shareholders Agreement held 64.9% of common stock outstanding as of February 18, 2014, giving them control; the company is a "controlled company" under NYSE rules.
- Dr. Dennis Gillings' beneficial ownership was 19.0% and Bain Capital and related funds held 18.4%, with TPG Funds at 16.5% and 3i affiliates at 11.6%.
- John D. Ratliff, former President and COO, retired December 31, 2013 and received severance of $3,185,142.
- PricewaterhouseCoopers LLP total fees for 2013 were $5,157 thousand, including $4,990 thousand in audit fees.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-K/AFY2013filed February 21, 2014Financial Statements
FY2013 against FY2012
| Line item | FY2013FY2012 | Change |
|---|---|---|
| Revenue | $5.10B$4.87B | +4.8% |
| R&D Expenses | $4.96M$10.43M | −52.5% |
| SG&A Expenses | $860.51M$817.75M | +5.2% |
| Operating Income | $462.33M$396.44M | +16.6% |
| Interest Expense | $123.51M-$134.37M | +191.9% |
| Net Income | $226.59M$177.55M | +27.6% |
| EPS (Basic) | $1.83$1.53 | +19.6% |
| EPS (Diluted) | $1.77$1.51 | +17.2% |
| Shares Outstanding (Basic) | 124.15M115.71M | +7.3% |
| Shares Outstanding (Diluted) | 127.86M117.80M | +8.5% |
05—Questions
Frequently Asked Questions
Why was this amendment filed?
The amendment presents the Part III information required by Form 10-K (directors and executive officers, executive compensation, security ownership, related person transactions, and auditor fees), which was not included in the original February 13, 2014 Form 10-K. It also restates the signature page, Section 302 certifications, and Item 15 with the Exhibit Index.
Who controls the company's board and voting power?
Parties to the Shareholders Agreement, including Dr. Gillings, Bain Capital, the TPG Funds, and 3i, agreed to vote their shares to elect specified board nominees. These parties together beneficially owned 64.9% of outstanding common stock as of February 18, 2014, and the company relies on the NYSE controlled company exemption.
How were 2013 executive bonuses determined?
Bonuses under the Management Incentive Plan were funded from a company-wide operating surplus target. Operating surplus at a fixed exchange rate was $742.9 million, or 113.1% of the $656.9 million target, which funded an overall bonus pool of $171.6 million. The Committee then set individual awards, including $1,500,000 for Mr. Pike and $1,000,000 for Dr. Gillings.
What related-party arrangements does the company disclose?
The filing discloses several related-party arrangements, including reimbursements to GF Management Company for use of Dr. Gillings' airplane (approximately $1.4 million in 2013), a management agreement terminated in May 2013 with a one-time $25.0 million fee, and service and consulting payments from PharmaBio Development Inc. of $23.1 million and $288,000 in 2013.
06—Continue