01—Abstract
Summary
Summary of the 10-K filed February 15, 2023. Cited figures are marked; the original filing is the authoritative source.
IQVIA Holdings Inc. reported 2022 revenues of $14.41 billiona, up 3.9% from $13.87 billion in 2021, with constant currency revenue growth of approximately $1,084 million, or 7.8%.
Income from operations rose to $1.80 billionb from $1.39 billion, and net income attributable to IQVIA Holdings Inc. was $1.09 billion, or $5.72 per diluted share, compared with $4.95 in 2021. Research & Development Solutions was the largest growth driver, with segment revenue of $7.92 billion and segment profit of $1.70 billion, and its contracted backlog grew to $27.2 billion from $24.8 billion. Technology & Analytics Solutions generated $5.75 billion in revenue and $1.55 billion in segment profit, while Contract Sales & Medical Solutions revenue declined 5.2% to $743 million.
The balance sheet carried $12.8 billionc of total indebtedness at December 31, 2022, against cash and cash equivalents of $1.22 billion. Operating cash flow fell to $2.26 billion from $2.94 billion, mainly due to lower unearned income inflows. The company repurchased 5.5 million shares for approximately $1.17 billion in 2022, and about $1.36 billion remained under the Repurchase Program.
Management noted continued COVID-19-related revenue declines expected in 2023, wage inflation and staffing pressures, and accelerated productivity initiatives aimed at mitigating these effects in 2023. The company disclosed remaining performance obligations of approximately $29.2 billiond at year-end, with about 30% expected to be recognized over the next twelve months. Interest expense rose to $416 million from $375 million on higher floating-rate borrowing costs, and the company entered into new interest rate swaps with a combined notional value of $1 billion on January 3, 2023.
02—Key points
Key Highlights
- Revenue increased 3.9% to $14.41 billion in 2022, with constant currency growth of approximately 7.8%.
- Income from operations rose to $1.80 billion from $1.39 billion; diluted EPS was $5.72 versus $4.95 in 2021.
- Research & Development Solutions revenue reached $7.92 billion, with segment profit of $1.70 billion and contracted backlog of $27.2 billion at year-end.
- Remaining performance obligations totaled approximately $29.2 billion, with about 30% expected to convert to revenue within twelve months.
- Total indebtedness was $12.8 billion at December 31, 2022, against cash of $1.22 billion; interest expense rose to $416 million.
- Operating cash flow declined to $2.26 billion from $2.94 billion, and the company repurchased $1.17 billion of stock during 2022.
- Management expects continued declines in COVID-19-related work in 2023 and is accelerating productivity initiatives to offset wage inflation and staffing pressures.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2022filed February 15, 2023Financial Statements
FY2022 against FY2021
| Line item | FY2022FY2021 | Change |
|---|---|---|
| Revenue | $14.41B$13.87B | +3.9% |
| SG&A Expenses | $2.07B$1.96B | +5.4% |
| Operating Income | $1.80B$1.39B | +29.1% |
| Interest Expense | $416.00M$375.00M | +10.9% |
| Net Income | $1.09B$971.00M | +12.4% |
| EPS (Basic) | $5.82$5.05 | +15.2% |
| EPS (Diluted) | $5.72$4.95 | +15.6% |
| Shares Outstanding (Basic) | 187.60M191.40M | −2.0% |
| Shares Outstanding (Diluted) | 190.60M195.00M | −2.3% |
05—Questions
Frequently Asked Questions
What drove revenue growth in 2022?
Research & Development Solutions contributed the largest increase, with segment revenue up $365 million to $7.92 billion, driven by volume-related increases in clinical services and lab testing. Technology & Analytics Solutions revenue rose $212 million to $5.75 billion, primarily due to growth in real world services. Contract Sales & Medical Solutions revenue declined $41 million, or 5.2%, to $743 million.
How is the company's debt position and liquidity?
As of December 31, 2022, IQVIA had $12.8 billion of total indebtedness, excluding $1.1 billion of additional available revolving credit borrowings, and cash and cash equivalents of $1.22 billion. The company had $425 million drawn under its $1.5 billion revolving credit facility and stated it was in compliance with its financial covenants in all material respects.
How much did the company return to shareholders in 2022?
IQVIA repurchased 5.5 million shares of common stock for approximately $1.17 billion under the Repurchase Program in 2022. The Board increased the repurchase authorization by $2.0 billion in February 2022, bringing the total authorized to $9.725 billion, with about $1.36 billion remaining at year-end. The company stated it does not currently intend to pay regular dividends.
What does the company expect for 2023?
Management expects a continued decline in COVID-19-related work in 2023 compared with 2022 if current pandemic trends persist. It also cited wage inflation, general inflation, and staff shortages affecting investigator sites, and decided to accelerate targeted productivity initiatives to mitigate these impacts in 2023. Restructuring actions are expected to continue through 2023.
What are the key risks related to the company's debt?
The company has substantial variable-rate debt, so rising interest rates increase borrowing costs. As of December 31, 2022, it had approximately $7.1 billion of variable rate indebtedness and swaps with a notional value of $1.8 billion. A hypothetical quarter-point change in rates on unhedged variable debt would change annual interest expense by approximately $14 million. Senior secured credit facility covenants restrict certain transactions and require compliance with leverage and interest coverage ratios.
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