(Exact name of Registrant as Specified in its Charter) | ||
ICON PUBLIC LIMITED COMPANY | ||
(Translation of Registrant’s name into English) | ||
Ireland | ||
(Jurisdiction of Incorporation or Organization) | ||
SOUTH COUNTY BUSINESS PARK, | ||
LEOPARDSTOWN, | ||
DUBLIN 18, IRELAND | ||
(Address of principal executive offices) |
Title of each class | Name of exchange on which registered | ||
ORDINARY SHARES, PAR VALUE €0.06 EACH | NASDAQ GLOBAL SELECT MARKET | ||
Securities registered or to be registered pursuant to section 12(g) of the Act: | |||
Title of each class | |||
NONE | |||
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: | |||
NONE | |||
(Title of class) |
Year Ended December 31, | |||||||||||||||
2017 | 2016 | 2015 | 2014 | 2013 | |||||||||||
(in thousands, except share and per share data) | |||||||||||||||
Statement of Operations Data: | |||||||||||||||
Gross revenue | $ | 2,402,321 | $ | 2,364,956 | $ | 2,161,618 | $ | 2,030,286 | $ | 1,784,345 | |||||
Reimbursable expenses (1) | (643,882 | ) | (698,469 | ) | (586,640 | ) | (526,970 | ) | (448,287 | ) | |||||
Net revenue | 1,758,439 | 1,666,487 | 1,574,978 | 1,503,316 | 1,336,058 | ||||||||||
Costs and expenses: | |||||||||||||||
Direct costs | 1,027,310 | 961,333 | 908,979 | 903,167 | 845,413 | ||||||||||
Selling, general and administrative | 323,741 | 325,726 | 326,786 | 336,461 | 313,931 | ||||||||||
Depreciation and amortization | 61,297 | 59,575 | 57,677 | 52,542 | 46,514 | ||||||||||
Restructuring and other items (2),(3),(4),(5) | 7,753 | 8,159 | — | 8,796 | 9,033 | ||||||||||
Total costs and expenses | 1,420,101 | 1,354,793 | 1,293,442 | 1,300,966 | 1,214,891 | ||||||||||
Income from operations | 338,338 | 311,694 | 281,536 | 202,350 | 121,167 | ||||||||||
Net interest (expense)/income | (10,281 | ) | (11,522 | ) | (2,686 | ) | 366 | (302 | ) | ||||||
Income before provision for income taxes | 328,057 | 300,172 | 278,850 | 202,716 | 120,865 | ||||||||||
Provision for income taxes | (46,569 | ) | (37,993 | ) | (39,311 | ) | (30,248 | ) | (18,053 | ) | |||||
Net income | $ | 281,488 | $ | 262,179 | $ | 239,539 | $ | 172,468 | $ | 102,812 | |||||
Net income per ordinary share (6): | |||||||||||||||
Basic | $ | 5.20 | $ | 4.75 | $ | 4.08 | $ | 2.80 | $ | 1.69 | |||||
Diluted | $ | 5.13 | $ | 4.65 | $ | 3.97 | $ | 2.73 | $ | 1.65 | |||||
Weighted average number of ordinary shares outstanding: | |||||||||||||||
Basic | 54,129,439 | 55,248,900 | 58,746,935 | 61,496,115 | 60,907,274 | ||||||||||
Diluted | 54,849,046 | 56,407,136 | 60,290,033 | 63,131,417 | 62,253,251 |
Year Ended December 31, | |||||||||||||||
2017 | 2016 | 2015 | 2014 | 2013 | |||||||||||
(in thousands) | |||||||||||||||
Balance Sheet Data: | |||||||||||||||
Cash and cash equivalents | $ | 282,859 | $ | 192,541 | $ | 103,911 | $ | 118,900 | $ | 182,519 | |||||
Short term investments - available for sale | 77,589 | 68,046 | 85,990 | 97,100 | 138,317 | ||||||||||
Working capital | 534,960 | 463,552 | 290,939 | 281,148 | 352,259 | ||||||||||
Total assets | 2,146,618 | 1,825,843 | 1,717,209 | 1,528,850 | 1,442,460 | ||||||||||
Non-current other liabilities | 17,111 | 23,752 | 12,224 | 13,179 | 11,198 | ||||||||||
Non-current government grants | 966 | 887 | 959 | 1,116 | 1,359 | ||||||||||
Ordinary share capital | 4,664 | 4,692 | 4,719 | 5,059 | 5,172 | ||||||||||
Additional paid-in capital | 481,337 | 438,126 | 383,355 | 327,212 | 279,568 | ||||||||||
Shareholders’ equity | 1,191,000 | 945,174 | 763,096 | 950,206 | 910,579 |
(1) | Reimbursable expenses are comprised of payments to investigators and certain other costs reimbursed by clients under terms specific to each of the Company’s contracts. See Note 2 (d) to the Audited Consolidated Financial Statements. |
(2) | A restructuring charge of $7.8 million was recognized during the year ended December 31, 2017, under a restructuring plan adopted following a review of operations. The restructuring plan reflected resource rationalization across the business to improve resource utilization. See Note 14 to the Audited Consolidated Financial Statements. |
(3) | A restructuring charge of $8.2 million was recognized during the year ended December 31, 2016 under a restructuring plan adopted following a review by the Company of its operations. The restructuring plan includes resource rationalizations in certain areas of the business to improve resource utilization and improve operational effectiveness, resulting in a charge of $6.2 million, and office consolidation which resulted in the recognition of an onerous lease obligation of $2.0 million. See Note 14 to the Audited Consolidated Financial Statements. |
(4) | A restructuring charge of $8.8 million was recognized during the year ended December 31, 2014. Following the closure of the Company’s European Phase 1 services in 2013, the Company recognized a charge in 2014 in relation to its Manchester, United Kingdom facility; $5.6 million in relation to asset impairments and $3.2 million in relation to an onerous lease charge associated with this facility. See Note 14 to the Audited Consolidated Financial Statements. |
(5) | During the year ended December 31, 2013 the Company conducted a review of its operations. A restructuring charge of $9.0 million was recognized as part of this review. The review resulted in the adoption of an initial restructuring plan, which included the closure of its Phase I facility in Omaha, Nebraska. This followed the expansion of the Company’s Phase I facility in San Antonio, Texas and the consolidation of the Company’s US Phase I capabilities into this location. The restructuring plan also included resource rationalizations in certain areas of the business to improve resource utilization. A further restructuring plan was also adopted during 2013 which resulted in resource rationalizations in order to improve operating efficiencies and reduce expenses. |
(6) | Net income per ordinary share is based on the weighted average number of outstanding ordinary shares. Diluted net income per share includes potential ordinary shares from the exercise of options. |
• | the failure of products being tested to satisfy safety or efficacy requirements; |
• | unexpected or undesired clinical results of the product; |
• | a decision that a particular study is no longer necessary or viable; |
• | poor project performance, quality concerns, insufficient patient enrollment or investigator recruitment; and |
• | production problems resulting in shortages of the drug. |
• | disruption or failure of data centers, telecommunications facilities or other key infrastructure platforms; |
• | security breaches, cyber-attacks or other failures or malfunctions in our application or information systems or their associated hardware or other systems that we have access to or that we rely upon or that have access to our systems; and |
• | excessive costs, excessive delays or other deficiencies in or problems with systems development and deployment. |
• | effectively and quickly assimilate the operations and services or products of the acquired company or business; |
• | integrate acquired personnel; |
• | retain and motivate key employees; |
• | retain customers; and |
• | minimize the diversion of management's attention from other business concerns. |
• | if pharmaceutical, biotechnology or medical device companies expanded upon their in-house clinical or development capabilities, they would be less likely to utilize our services; |
• | if governmental regulations were changed, it could affect the ability of our clients to operate profitably, which may lead to a decrease in research spending and therefore this could have a material adverse effect on our business; and |
• | if unfavorable economic conditions or disruptions in the credit and capital markets negatively impacted our clients. |
• | termination of or delay in any research; |
• | disqualification of data; |
• | denial of the right to conduct business; |
• | criminal penalties; |
• | other enforcement actions including debarment from government contracts; |
• | loss of clients and/or business; and |
• | litigation from clients and/or patients and/or regulatory authorities and/or other affected third parties, and resulting material penalties, damages and costs. |
• | limit our ability to borrow additional funds for working capital, capital expenditures, acquisitions or other general business purposes; |
• | limit our ability to use our cash flow or obtain additional financing for future working capital, capital expenditures, acquisitions or other general business purposes; |
• | require us to use all or a portion of our cash flow from operations to make debt service payments; |
• | require us to sell certain assets; |
• | restrict us from making strategic investments, including acquisitions or cause us to make non-strategic divestitures; |
• | place us at a competitive disadvantage compared to our competitors that have less debt; |
• | cause us to incur substantial fees from time to time in connection with debt amendments or refinancing; |
• | limit our flexibility to plan for, or react to, changes in our business and industry; and |
• | increase our vulnerability to the impact of adverse economic and industry conditions. |
• | incur or assume liens or additional debt; |
• | dispose of assets; |
• | engage in mergers or reorganizations; or |
• | enter into certain types of transactions with affiliates. |
• | our results of operations; |
• | issuance of new or changed securities analysts’ reports or recommendations; |
• | developments impacting the industry or our competitors and general market and economic conditions; |
• | introduction of new products or services by us or our competitors; |
• | the public's reaction to our press releases, our other public announcements and our filings with the SEC; |
• | guidance, if any, that we provide to the public, any changes in this guidance or failure to meet this guidance; |
• | changes in the credit ratings of our debt; |
• | sales, or anticipated sales, of large blocks of our stock; |
• | additions or departures of key personnel; |
• | regulatory or political developments; |
• | litigation and governmental investigations; |
• | changing economic conditions; and |
• | exchange rate fluctuations. |
• | Product Development Planning; |
• | Strategic Consulting; |
• | Study Protocol Preparation; |
• | Clinical Pharmacology; |
• | Pharmacokinetic and Pharmacodynamic Analysis; |
• | Clinical Research Centers; |
• | Investigator Sites; |
• | Patient Recruitment; |
• | Study Monitoring and Data Collection; |
• | Case Report Form ("CRF") Preparation; |
• | Statistical Analysis; |
• | Patient Safety Monitoring; |
• | Risk-based Monitoring; |
• | Clinical Data Management; |
• | Strategic Analysis and Data Operations; |
• | Regulatory Consulting; |
• | Medical Reporting and Pharmacovigilance; |
• | Interactive Response Technologies; |
• | Electronic Endpoint Adjudication; |
• | Medical Imaging; |
• | Adaptive Trial Design and Execution; |
• | Medical Device Trials; |
• | Biosimilar Trials; |
• | Research Trials for US Government Agencies; |
• | Functional Services; |
• | Strategic Resourcing; |
• | Sample Analyses; |
• | Safety Testing; |
• | Microbiology; |
• | Custom flow Cytometry; |
• | Electronic Transmission of Test Results; |
• | Biomarker Development; |
• | Bioanalysis; |
• | Immunoassay Development; |
• | Electronic Patient Reported Outcomes; |
• | Patient Registries; |
• | Outcomes Research; |
• | Health Economics; |
• | Market Access and Commercialization Services; |
• | Drug Pricing Consulting; and |
• | Health Care and Scientific Communications. |
• | Seeking contractual indemnification from customers in relation to certain activities. However, the terms and scope of indemnification varies from customer to customer and project to project and the performance of these indemnities is not secured. As a result, we bear the risk that indemnification may not be relevant or sufficient or that the indemnifying party may not have the financial ability to fulfill its indemnification obligations. Furthermore this indemnification does not protect us against our own acts or omissions such as our negligence or where our performance does not reach the required contractual, industry or regulatory standard. |
• | Maintaining worldwide professional liability insurance. While we believe our insurance coverage is adequate, there is no guarantee that we will continue to be able to maintain such insurance coverage on terms acceptable to us, if at all, or that the relevant policy will respond and provide cover when we want it to. |
Company | Country | Group ownership |
ICON Clinical Research, S.A. | Argentina | 100% |
ICON Clinical Research PTY Limited | Australia | 100% |
ICON Clinical Research Austria GmbH | Austria | 100% |
DOCS International Belgium N.V. | Belgium | 100% |
ICON Pesquisas Clínicas LTDA. | Brazil | 100% |
ICON Clinical Research EOOD | Bulgaria | 100% |
ICON Clinical Research (Canada) Inc. | Canada | 100% |
Mapi Life Sciences Canada Inc. | Canada | 100% |
Oxford Outcomes LTD. | Canada | 100% |
ICON Chile Limitada | Chile | 100% |
ICON Clinical Research (Beijing No.2) Co., Ltd | China | 100% |
ICON Clinical Research (Beijing) Co., Ltd | China | 100% |
Ispitivanja ICON d.o.o (ICON Research Ltd.) | Croatia | 100% |
ICON Clinical Research s.r.o. | Czech Republic | 100% |
DOCS International Nordic Countries A/S | Denmark | 100% |
Company | Country | Group ownership |
DOCS International Finland Oy | Finland | 100% |
DOCS International France S.A.S. | France | 100% |
ICON Clinical Research S.A.R.L. | France | 100% |
Mapi Développement SAS | France | 100% |
Mapi Research Trust | France | 100% |
Mapi SAS | France | 100% |
DOCS International Germany GmbH | Germany | 100% |
ICON Clinical Research GmbH | Germany | 100% |
ICON Clinical Research Hong Kong Limited | Hong Kong | 100% |
ICON Klinikai Kutató Korlátolt Felelősségű Társaság (ICON Clinical Research Limited Liability Company) | Hungary | 100% |
ICON Clinical Research India Private Limited | India | 100% |
ICON Clinical Research Israel Limited | Israel | 100% |
DOCS Italia S.R.L. | Italy | 100% |
ICON Japan K.K. | Japan | 100% |
ICON Investments Limited | Jersey | 100% |
ICON Clinical Research Korea Yuhan Hoesa (ICON Clinical Research Korea Ltd.) | Korea | 100% |
ICON CRO Malaysia SDN. BHD. | Malaysia | 100% |
ICON Clinical Research México, S.A. de C.V. | Mexico | 100% |
DOCS Insourcing B.V. | Netherlands | 100% |
DOCS International B.V. | Netherlands | 100% |
ICON Contracting Solutions Holdings B.V. | Netherlands | 100% |
Mapi B.V. | Netherlands | 100% |
Mapi Life Sciences NL B.V. | Netherlands | 100% |
ICON Clinical Research (New Zealand) Limited | New Zealand | 100% |
ICON Clinical Research Perú S.A. | Peru | 100% |
Company | Country | Group ownership |
ICON Clinical Research Services Philippines, Inc. | Philippines | 100% |
DOCS International Poland Sp. z o.o. | Poland | 100% |
ICON Clinical Research Sp. z o.o. | Poland | 100% |
DOCS Resourcing Limited | Republic of Ireland | 100% |
ICON Clinical International Unlimited Company | Republic of Ireland | 100% |
ICON Clinical Research Limited | Republic of Ireland | 100% |
ICON Clinical Research Property Development (Ireland) Limited | Republic of Ireland | 100% |
ICON Holdings Unlimited Company | Republic of Ireland | 100% |
ICON Holdings Clinical Research International Limited | Republic of Ireland | 100% |
ICON Investments Five Unlimited Company | Republic of Ireland | 100% |
ICON Investments Four Unlimited Company | Republic of Ireland | 100% |
ICON Clinical Research S.R.L. | Romania | 100% |
ICON Clinical Research (Rus) LLC | Russia | 100% |
ICON Clinical Research d.o.o. Beograd | Serbia | 100% |
ICON Clinical Research (Pte) Limited | Singapore | 100% |
ICON Clinical Research Slovakia, s.r.o. | Slovakia | 100% |
ICON Clinical Research España, S.L. | Spain | 100% |
Mapi Life Sciences Spain, S.L. | Spain | 100% |
DOCS International Sweden AB | Sweden | 100% |
Mapi Sweden A.B. | Sweden | 100% |
DOCS International Switzerland GmbH | Switzerland | 100% |
ICON Clinical Research (Switzerland) GmbH | Switzerland | 100% |
ICON Clinical Research Taiwan Limited | Taiwan | 100% |
ICON Clinical Research (Thailand) Limited | Thailand | 100% |
ICON Ankara Klinik Arastirma Dis Ticaret Anonim Sirketi | Turkey | 100% |
DOCS Ukraine LLC | Ukraine | 100% |
ICON Clinical Research LLC | Ukraine | 100% |
Company | Country | Group ownership |
DOCS International UK Limited | United Kingdom | 100% |
ICON Clinical Research (U.K.) Limited | United Kingdom | 100% |
ICON Development Solutions Limited | United Kingdom | 100% |
Mapi Life Sciences UK Limited | United Kingdom | 100% |
Addplan, Inc. | USA | 100% |
Beacon Bioscience, Inc. | USA | 100% |
C4 MedSolutions, LLC | USA | 100% |
Clinical Research Management, Inc. | USA | 100% |
CHC Group, LLC | USA | 100% |
Complete Healthcare Communications, LLC | USA | 100% |
Complete Publication Solutions, LLC | USA | 100% |
DOCS Global, Inc. | USA | 100% |
Global Pharmaceutical Strategies Group, LLC | USA | 100% |
ICON Clinical Research LLC | USA | 100% |
ICON Early Phase Services, LLC | USA | 100% |
ICON Laboratory Services, Inc. | USA | 100% |
ICON US Holdings Inc. | USA | 100% |
Managed Care Strategic Solutions, L.L.C. | USA | 100% |
Mapi USA, Inc. | USA | 100% |
MMMM Consulting, LLC | USA | 100% |
MMMM Group, LLC | USA | 100% |
PMG Research of Bristol, LLC | USA | 100% |
PMG Research of Charleston, LLC | USA | 100% |
PMG Research of Charlotte, LLC | USA | 100% |
PMG Research of Christie Clinic, LLC | USA | 100% |
PMG Research of Hickory, LLC | USA | 100% |
Company | Country | Group ownership |
PMG Research of Raleigh, LLC | USA | 100% |
PMG Research of Rocky Mount, LLC | USA | 100% |
PMG Research of Salisbury, LLC | USA | 100% |
PMG Research of Wilmington, LLC | USA | 100% |
PMG Research of Winston-Salem, LLC | USA | 100% |
PMG Research, Inc. | USA | 100% |
Pricespective, LLC | USA | 100% |
PubsHub LLC | USA | 100% |
Year Ended December 31, | ||||||||
2017 | 2016 | 2017 | 2016 | |||||
Percentage of Net Revenue | Percentage Increase/(Decrease) | |||||||
Net revenue | 100 | % | 100 | % | 5.5 | % | 5.8 | % |
Costs and expenses: | ||||||||
Direct costs | 58.4 | % | 57.7 | % | 6.9 | % | 5.8 | % |
Selling, general and administrative | 18.4 | % | 19.5 | % | (0.6 | )% | (0.3 | )% |
Depreciation | 2.5 | % | 2.5 | % | 3.1 | % | 4.8 | % |
Amortization | 1.0 | % | 1.1 | % | 2.3 | % | (0.1 | )% |
Income from operations (excluding restructuring and other items) | 19.7 | % | 19.2 | % | 8.2 | % | 13.6 | % |
Restructuring and other items | 0.5 | % | 0.5 | % | (5.0 | )% | 100 | % |
Income from operations (including restructuring and other items ) | 19.2 | % | 18.7 | % | 8.5 | % | 10.7 | % |
Balance December 31, 2016 | Drawn down/ (repaid) | Net cash inflow/ (outflow) | Other non-cash adjustments | Effect of exchange rates | Balance December 31, 2017 | |||||
$ in thousands | ||||||||||
Cash and cash equivalents | 192,541 | 0 | 85,991 | 0 | 4,327 | 282,859 | ||||
Private placement notes | (348,511) | - | (377 | ) | - | (348,888 | ) | |||
(155,970) | 0 | 85,991 | (377 | ) | 4,327 | (66,029 | ) |
Payments due by period | |||||||||||||||
Total | Less than 1 year | 1 to 3 years | 3 to 5 years | More than 5 years | |||||||||||
(U.S.$ in millions) | |||||||||||||||
Operating lease obligations | 166.2 | 38.1 | 58.9 | 32.5 | 36.7 | ||||||||||
Senior Notes | 350.0 | — | 350.0 | — | — | ||||||||||
Interest on Senior Notes | 38.2 | 12.7 | 25.5 | — | — | ||||||||||
Current and Non-current tax liabilities | 16.4 | 3.9 | 3.6 | 7.7 | 1.2 | ||||||||||
Total (U.S.$ in millions) | $ | 570.8 | $ | 54.7 | $ | 438.0 | $ | 40.2 | $ | 37.9 |
• | If an entity had early adopted the new revenue standard before this ASU was issued (May 16, 2017), the entity may adopt this ASU on its effective date with certain specific transition provisions. |
• | If an entity early adopts the new revenue standard after this ASU was issued, the entity must adopt this ASU at the same time as the new revenue standard with certain specific transition provisions. |
• | An entity may elect to early adopt this ASU before the adoption of the new revenue standard with certain specific transition provisions. |
• | Debt prepayment or debt extinguishment costs; |
• | Settlement of zero-coupon bonds; |
• | Contingent consideration payments made after a business combination; |
• | Proceeds from the settlement of insurance claims; |
• | Proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; |
• | Distributions received from equity method investees; |
• | Beneficial interests in securitization transactions; and |
• | Separately identifiable cash flows and application of the predominance principle. |
• | Eliminating the requirement to separately measure and report hedge ineffectiveness; and |
• | Presenting all items that affect earnings in the same income statement line item as the hedged item. |
• | Applying hedge accounting to additional hedging strategies; |
• | Measuring the hedged item in fair value hedges of interest rate risk; |
• | Reducing the cost and complexity of applying hedge accounting by easing the requirements for effectiveness testing, hedge documentation and application of the critical terms match method; and |
• | Reducing the risk of material error correction if a company applies the shortcut method inappropriately. |
Name | Age | Position |
Ciaran Murray (1) | 55 | Executive Chairman and Director |
Dr. Steve Cutler (1) (5) | 57 | Chief Executive Officer and Director |
Brendan Brennan (1)(5) | 39 | Chief Financial Officer |
Declan McKeon (2)(3)(4)(5) | 66 | Lead Independent Director |
Dr. John Climax | 65 | Director |
Dr. Ronan Lambe | 78 | Director |
Professor Dermot Kelleher (3) | 62 | Director |
Professor William Hall (2)(3)(4) | 68 | Director |
Mary Pendergast (2) | 67 | Director |
Professor Hugh Brady | 58 | Director |
Ronan Murphy (2)(3)(4) | 60 | Director |
Eugene McCague | 59 | Director |
Joan Garahy | 55 | Director |
Diarmaid Cunningham | 43 | Chief Administrative Officer, General Counsel, Executive Vice President & Company Secretary |
(1) | Executive Officer of the Company. |
(2) | Member of Compensation and Organization Committee. |
(3) | Member of Audit Committee. |
(4) | Member of Nominating and Governance Committee. |
(5) | Member of Execution Committee. |
Directors’ Attendance Table | ||||||
Board | Audit | Compensation and Organization | Nominating and Governance | Execution | Quality (4) | |
Director | Number of meetings attended / number of meetings eligible to attend as a Director | |||||
Ciaran Murray | 10/10 | — | — | — | — | — |
Dr. Steve Cutler | 10/10 | — | — | — | — | — |
Declan McKeon (1) | 9/10 | 4/4 | 3/3 | 6/6 | — | — |
Dr. John Climax (1) | 10/10 | — | - | — | — | 1/1 |
Dr. Ronan Lambe (1) | 10/10 | — | — | — | — | 1/1 |
Prof. Dermot Kelleher (1) | 10/10 | 4/4 | — | — | — | 1/1 |
Prof. William Hall (1) | 10/10 | 3/4 | 3/3 | 6/6 | — | 1/1 |
Mary Pendergast (1) | 10/10 | — | 3/3 | — | — | 1/1 |
Prof. Hugh Brady (1) | 9/10 | — | — | — | — | — |
Ronan Murphy (1) | 9/10 | 4/4 | 3/3 | 6/6 | — | — |
Eugene McCague (1) (2) | 2/2 | — | — | — | — | — |
Joan Garahy (1) (3) | 1/1 | — | — | — | — | — |
(1) | Independent Director as defined under NASDAQ Rule 5605(a)(2). |
(2) | Mr. Eugene McCague was appointed as a Director on October 3, 2017. |
(3) | Ms. Joan Garahy was appointed as a Director on November 16, 2017. |
(4) | The Quality Committee was retired on April 25, 2017. |
Name & principal position | Year | Salary | Bonus | Pension contribution | All other compensation | Subtotal | Share-based compensation | Director’s Fees | Total compensation | ||||||||
$’000 | $’000 | $’000 | $’000 | $’000 | $’000 | $’000 | $’000 | ||||||||||
Ciaran Murray Executive Chairman and former Chief Executive Officer | 2017 | 1,119 | 339 | 140 | 35 | 1,633 | 5,903 | — | 7,536 | ||||||||
Dr. Steve Cutler Chief Executive Officer and former Chief Operating Officer | 2017 | 1,045 | 1,210 | 110 | 235 | 2,600 | 4,453 | 37 | 7,090 | ||||||||
Brendan Brennan, Chief Financial Officer | 2017 | 525 | 393 | 66 | 26 | 1,010 | 1,503 | — | 2,513 | ||||||||
Total | 2017 | 2,689 | 1,942 | 316 | 296 | 5,243 | 11,859 | 37 | 17,139 |
Name & principal position | Year | Salary | Bonus | Pension contribution | All other compensation | Subtotal | Share-based compensation | Director’s Fees | Total compensation | ||||||||
$’000 | $’000 | $’000 | $’000 | $’000 | $’000 | $’000 | $’000 | ||||||||||
Ciaran Murray, Chief Executive Officer | 2016 | 1,307 | 623 | 163 | 39 | 2,132 | 8,596 | — | 10,728 | ||||||||
Brendan Brennan, Chief Financial Officer | 2016 | 516 | 191 | 65 | 26 | 798 | 1,639 | — | 2,437 | ||||||||
Dr. Steve Cutler Chief Operating Officer | 2016 | 790 | 318 | 165 | 54 | 1,327 | 4,503 | — | 5,830 | ||||||||
Total | 2016 | 2,613 | 1,132 | 393 | 119 | 4,257 | 14,738 | — | 18,995 |
Name | Year | Salary | Company pension contribution | All other compensation | Subtotal | Share-based compensation | Director’s fees | Total Compensation | |||||||
$’000 | $’000 | $’000 | $’000 | $’000 | $’000 | $’000 | |||||||||
Ciaran Murray * | 2017 | 1,119 | 140 | 374 | 1,633 | 5,903 | — | 7,536 | |||||||
Declan McKeon** | 2017 | — | — | — | — | 137 | 169 | 306 | |||||||
John Climax | 2017 | — | — | — | — | 137 | 69 | 206 | |||||||
Ronan Lambe | 2017 | — | — | — | — | 137 | 69 | 206 | |||||||
Dermot Kelleher | 2017 | — | — | — | — | 137 | 83 | 220 | |||||||
William Hall | 2017 | — | — | — | — | 148 | 113 | 261 | |||||||
Mary Pendergast | 2017 | — | — | — | — | 131 | 81 | 212 | |||||||
Hugh Brady | 2017 | — | — | — | — | 131 | 65 | 196 | |||||||
Steve Cutler | 2017 | 1,045 | 110 | 1,445 | 2,600 | 4,453 | 37 | 7,090 | |||||||
Ronan Murphy | 2017 | — | — | — | — | 27 | 110 | 137 | |||||||
Eugene McCague *** | 2017 | — | — | — | — | — | 16 | 16 | |||||||
Joan Garahy **** | 2017 | — | — | — | — | — | 8 | 8 | |||||||
Total | 2017 | 2,164 | 250 | 1,819 | 4,233 | 11,341 | 820 | 16,394 |
* | Appointed as Executive Chairman on March 1, 2017. |
** | Appointed as Lead Independent Director on March 1, 2017. Acting Chairman until March 1, 2017. |
*** | Appointed to the Board on October 3, 2017. |
**** | Appointed to the Board on November 16, 2017. |
Name | Year | Salary | Company pension contribution | All other compensation | Subtotal | Share-based compensation | Director’s fees | Total Compensation | |||||||
$’000 | $’000 | $’000 | $’000 | $’000 | $’000 | $’000 | |||||||||
Thomas Lynch* | 2016 | — | — | — | — | 634 | 161 | 795 | |||||||
Declan McKeon** | 2016 | — | — | — | — | 100 | 285 | 385 | |||||||
Ciaran Murray | 2016 | 1,307 | 163 | 662 | 2,132 | 8,596 | — | 10,728 | |||||||
John Climax | 2016 | — | — | — | — | 100 | 77 | 177 | |||||||
Ronan Lambe | 2016 | — | — | — | — | 100 | 77 | 177 | |||||||
Dermot Kelleher | 2016 | — | — | — | — | 100 | 97 | 197 | |||||||
William Hall | 2016 | — | — | — | — | 108 | 122 | 230 | |||||||
Mary Pendergast | 2016 | — | — | — | — | 91 | 89 | 180 | |||||||
Hugh Brady | 2016 | — | — | — | — | 91 | 64 | 155 | |||||||
Steve Cutler | 2016 | 790 | 165 | 372 | 1,327 | 4,503 | — | 5,830 | |||||||
Ronan Murphy*** | 2016 | — | — | — | — | — | 21 | 21 | |||||||
Total | 2016 | 2,097 | 328 | 1,034 | 3,459 | 14,423 | 993 | 18,875 |
* | Retired as Chairman on March 31, 2016. Resigned from the Board on July 22, 2016. |
** | Appointed as acting Chairman on April 1, 2016. |
*** | Appointed to the Board on October 18, 2016. |
Name of Owner or Identity of Group | No. of Shares (1) | % of total Shares | ||
Mr. Ciaran Murray | 4,063 | 0.01 | % | |
Dr. Steve Cutler | 26,911 | 0.05 | % | |
Mr. Brendan Brennan | — | — | ||
Dr. John Climax | 762,211 | 1.41 | % | |
Dr. Ronan Lambe | 600 | — | ||
Professor Dermot Kelleher | — | — | ||
Mr. Declan McKeon | — | — | ||
Professor William Hall | — | — | ||
Ms. Mary Pendergast | — | — | ||
Professor Hugh Brady | — | — | ||
Mr. Ronan Murphy | — | — | ||
Mr. Eugene McCague | — | — | ||
Ms. Joan Garahy | — | — |
(1) | As used in these tables, each person has the sole or shared power to vote or direct the voting of a security, or the sole or shared investment power with respect to a security ( i.e. the power to dispose, or direct the disposition, of a security). A person is deemed as of any date to have "beneficial ownership" of any security if that such person has the right to acquire such security within 60 days after such date. |
Name of Owner or Identity of Group | No. of RSUs (1) | Vesting Date | No. of PSUs (1) | Vesting Date |
Mr. Ciaran Murray | 8,293 | March 4, 2018 | 42,358 | May 3, 2018 |
8,472 | May 3, 2018 | 41,470 | March 4, 2019 | |
8,296 | March 4, 2019 | |||
Dr. Steve Cutler | 5,271 | March 3, 2018 | 22,591 | May 3, 2018 |
4,423 | March 4, 2018 | 22,117 | March 4, 2019 | |
4,520 | May 3, 2018 | 18,449 | March 3, 2020 | |
5,271 | March 3, 2019 | |||
4,424 | March 4, 2019 | |||
5,272 | March 3, 2020 | |||
Mr. Brendan Brennan | 1,190 | March 3, 2018 | 7,435 | May 3, 2018 |
1,965 | March 4, 2018 | 9,827 | March 4, 2019 | |
1,489 | May 3, 2018 | 4,167 | March 3, 2020 | |
1,190 | March 3, 2019 | |||
1,966 | March 4, 2019 | |||
1,192 | March 3, 2020 |
(1) | Of the issued PSUs, performance conditions will determine how many vest. If performance targets are exceeded, additional PSUs will be issued and will vest in accordance with the terms of the relevant PSU award. The PSUs vest based on service and specified EPS targets over the period 2014 – 2017, 2015 – 2018, 2016 - 2019 and 2017 - 2020. Depending on the actual amount of EPS from 2014 to 2020, up to an additional 168,414 PSUs may also be granted. |
Name of Owner or Identity of Group | No. of Options (1) | Exercise price | Expiration Date | |||
Mr. Ciaran Murray | 77,873 | $ | 32.37 | May 1, 2021 | ||
12,540 | $ | 47.03 | March 3, 2022 | |||
26,916 | $ | 48.67 | March 17, 2022 | |||
35,157 | $ | 68.39 | March 18, 2023 | |||
45,948 | $ | 71.95 | March 4, 2024 | |||
7,693 | $ | 90.03 | May 19, 2025 | |||
Dr. Steve Cutler | 43,539 | $ | 32.37 | May 1, 2021 | ||
10,761 | $ | 47.03 | March 3, 2022 | |||
23,078 | $ | 48.67 | March 17, 2022 | |||
31,250 | $ | 68.39 | March 18, 2023 | |||
30,632 | $ | 71.95 | March 4, 2024 | |||
62,887 | $ | 83.47 | March 3, 2025 | |||
Name of Owner or Identity of Group | No. of Options (1) | Exercise price | Expiration Date | |||
Mr. Declan McKeon | 400 | $ | 22.30 | April 27, 2020 | ||
1,000 | $ | 32.37 | May 1, 2021 | |||
6,000 | $ | 40.83 | May 23, 2022 | |||
8,000 | $ | 68.39 | March 18, 2023 | |||
10,557 | $ | 65.60 | May 20, 2024 | |||
7,693 | $ | 90.03 | May 19, 2025 | |||
Mr. Brendan Brennan | 15,813 | $ | 32.37 | May 1, 2021 | ||
3,251 | $ | 47.03 | March 3, 2022 | |||
6,967 | $ | 48.67 | March 17, 2022 | |||
10,285 | $ | 68.39 | March 18, 2023 | |||
13,611 | $ | 71.95 | March 4, 2024 | |||
14,206 | $ | 83.47 | March 3, 2025 | |||
Dr. John Climax | 2,000 | $ | 20.28 | March 3, 2019 | ||
2,000 | $ | 22.30 | April 27, 2020 | |||
2,500 | $ | 32.37 | May 1, 2021 | |||
10,000 | $ | 40.83 | May 23, 2022 | |||
10,000 | $ | 68.39 | March 18, 2023 | |||
10,557 | $ | 65.60 | May 20, 2024 | |||
7,693 | $ | 90.03 | May 19, 2025 | |||
Dr. Ronan Lambe | 2,000 | $ | 20.28 | March 3, 2019 | ||
2,000 | $ | 22.30 | April 27, 2020 | |||
2,500 | $ | 32.37 | May 1, 2021 | |||
10,000 | $ | 40.83 | May 23, 2022 | |||
10,000 | $ | 68.39 | March 18, 2023 | |||
10,557 | $ | 65.60 | May 20, 2024 | |||
7,693 | $ | 90.03 | May 19, 2025 | |||
Professor Dermot Kelleher | 800 | $ | 20.28 | March 3, 2019 | ||
1,200 | $ | 22.30 | April 27, 2020 | |||
2,000 | $ | 32.37 | May 1, 2021 | |||
10,000 | $ | 40.83 | May 23, 2022 | |||
10,000 | $ | 68.39 | March 18, 2023 | |||
10,557 | $ | 65.60 | May 20, 2024 | |||
7,693 | $ | 90.03 | May 19, 2025 | |||
Professor William Hall | 3,000 | $ | 32.37 | May 1, 2021 | ||
6,000 | $ | 40.83 | May 23, 2022 | |||
10,000 | $ | 68.39 | March 18, 2023 | |||
10,557 | $ | 65.60 | May 20, 2024 | |||
7,693 | $ | 90.03 | May 19, 2025 | |||
Ms. Mary Pendergast | 10,000 | $ | 40.83 | May 23, 2022 | ||
10,000 | $ | 68.39 | March 18, 2023 | |||
10,557 | $ | 65.60 | May 20, 2024 | |||
7,693 | $ | 90.03 | May 19, 2025 |
Name of Owner or Identity of Group | No. of Options (1) | Exercise price | Expiration Date | |||
Professor Hugh Brady | 10,000 | $ | 40.83 | May 23, 2022 | ||
10,000 | $ | 68.39 | March 18, 2023 | |||
10,557 | $ | 65.60 | May 20, 2024 | |||
7,693 | $ | 90.03 | May 19, 2025 | |||
Mr. Ronan Murphy | 7,693 | $ | 90.03 | May 19, 2025 |
(1) | The title of securities covered by all of the above options are non-qualified. |
Name of Owner or Identity of Group | No. of Shares (1) | Percent of Class | ||
WCM Investment Management (2) | 4,376,491 | 8.1 | % | |
Wellington Management Company, LLP (2) | 3,724,413 | 6.9 | % | |
All Directors, officers and other key employees as a group (3) | 2,030,152 | 3.8 | % |
(1) | As used in this table, each person has the sole or shared power to vote or direct the voting of a security, or the sole or shared investment power with respect to a security (i.e., the power to dispose, or direct the disposition, of a security). A person is deemed as of any date to have "beneficial ownership" of any security if that such person has the right to acquire such security within 60 days after such date. |
(2) | Neither the Company nor any of its officers, Directors or affiliates holds any voting power in this entity. |
(3) | Includes 795,453 ordinary shares issuable upon the exercise of stock options granted by the Company, 69,818 RSUs awarded by the Company to Directors, officers and other key employees and 369,656 PSUs awarded by the Company to Directors, officers and other key employees. Of the PSUs, performance conditions determine how many of them will vest and, if performance targets are exceeded, additional PSUs will be issued and vest in accordance with the terms of the relevant PSU award, the figure included is the maximum amount of PSUs that may be issued. |
Year Ending | High Sales Price During Period | Low Sales Price During Period | ||||
December 31, 2013 | $ | 44.23 | $ | 26.70 | ||
December 31, 2014 | $ | 59.81 | $ | 35.33 | ||
December 31, 2015 | $ | 84.14 | $ | 50.91 | ||
December 31, 2016 | $ | 85.74 | $ | 62.31 | ||
December 31, 2017 | $ | 124.48 | $ | 74.30 | ||
Quarter Ending | High Sales Price During Period | Low Sales Price During Period | ||||
March 31, 2016 | $ | 77.79 | $ | 64.08 | ||
June 30, 2016 | $ | 77.08 | $ | 62.31 | ||
Sept 30, 2016 | $ | 79.61 | $ | 69.05 | ||
Dec 31, 2016 | $ | 85.74 | $ | 73.76 | ||
March 31, 2017 | $ | 88.90 | $ | 74.30 | ||
June 30, 2017 | $ | 100.87 | $ | 76.46 | ||
Sept 30, 2017 | $ | 117.53 | $ | 96.03 | ||
Dec 31, 2017 | $ | 124.48 | $ | 110.54 | ||
Month Ending | High Sales Price During Period | Low Sales Price During Period | ||||
Jul 31, 2017 | $ | 109.32 | $ | 96.03 | ||
Aug 31, 2017 | $ | 114.27 | $ | 101.00 | ||
Sept 30, 2017 | $ | 117.53 | $ | 109.78 | ||
Oct 31, 2017 | $ | 123.53 | $ | 111.86 | ||
Nov 30, 2017 | $ | 124.48 | $ | 110.55 | ||
Dec 31, 2017 | $ | 117.39 | $ | 110.54 |
• | The company claiming the exemption must hold (directly or indirectly) at least 5% of the ordinary share capital of the company in which the interest is being disposed of, throughout a continuous period of at least 12 months, within the two year period prior to disposal |
• | The shares being disposed of must be in a company, which at the date of disposal, is resident in a Member State of the European Communities or in a country with which Ireland has signed or made specific arrangements to sign a double tax agreement (together a “Relevant Territory”) |
• | The shares must be in a company which is primarily a trading company or the company making the disposal together with its “5% plus subsidiaries” should be primarily a trading group |
• | The shares must not derive the greater part of their value from land or mineral rights in the State. |
• | are resident in a Relevant Territory and are not controlled (directly or indirectly) by Irish residents |
• | are ultimately controlled (directly or indirectly) by residents of a Relevant Territory or |
• | have the principal class of their shares, or shares of a 75% parent, substantially and regularly traded on one or more recognized stock exchanges in a Relevant Territory (including Ireland) or Territories; or |
• | are wholly owned by two or more companies, each of whose principal class of shares is substantially and regularly traded on one or more recognized stock exchanges in a Relevant Territory (including Ireland) or Territories. |
• | the depositary or the DTC is resident in a Relevant Territory and |
• | the depositary or the DTC have entered into a qualifying intermediary agreement with the Irish tax authorities and |
• | the depositary or the DTC have been authorized by the Irish Revenue Commissioners as a qualifying intermediary and such authorization has not expired or been revoked. |
• | an individual resident in the U.S. or in a Relevant Territory; |
• | a corporation that is ultimately controlled by persons resident in the U.S. or in a Relevant Territory; |
• | a corporation whose principal class of shares (or its 75% or greater parent’s principal class of shares) is substantially and regularly traded on a recognized stock exchange in an EU country or in a Relevant Territory; |
• | a corporation resident in another EU member state or in a Relevant Territory, which is not controlled directly or indirectly by Irish residents; or |
• | a corporation that is wholly owned by two or more corporations each of whose principal class of shares is substantially and regularly traded on a recognized stock exchange in an EU country or in a Relevant Territory. |
• | who cease to be Irish resident; |
• | who beneficially own the relevant assets when they cease to be resident; |
• | if there are not more than 5 years of assessment between the last year of Irish tax residence prior to becoming temporarily non-resident and the tax year that he/she resumes Irish tax residency; |
• | who dispose of the relevant assets during this temporary non-residence; and |
• | the interest disposed of represents 5% or greater of the issued share capital of the company or is worth at least €500,000. |
• | to the extent that the property of which the gift or inheritance consists is situated in the Republic of Ireland at the date of the gift or inheritance; |
• | where the person making the gift or inheritance is or was resident or ordinarily resident in the Republic of Ireland at the date of the disposition under which the gift or inheritance is taken; |
• | in the case of a gift taken under a discretionary trust where the person from whom the gift is taken was resident or ordinarily resident in the Republic of Ireland at the date he made the settlement, or at the date of the gift or, if he is dead at the date of the gift, at the date of his death; or |
• | where the person receiving the gift or inheritance is resident or ordinarily resident in the Republic of Ireland at the date of the gift or inheritance. |
• | €16,250 in the case of persons who are not related to one another; |
• | €32,500 in the case of gifts or inheritances received from inter alia a brother or sister or from a brother or sister of a parent or from a grandparent; and |
• | €310,000 in the case of gifts and inheritances received from a parent (or from a grandparent by a minor child of a deceased child) and specified inheritances received by a parent from a child. |
• | The Company is exempt from provisions set forth in NASDAQ Rule 5620(c), which requires each issuer (other than limited partnerships) to provide for a quorum in its by-laws for any meeting of the holders of common stock, which shall in no case be less than 33.33% of the outstanding shares of the issuer’s common voting stock. The Company’s Articles of Association require that only 3 members be present, in person or by proxy, at a shareholder meeting to constitute a quorum. This quorum requirement is in accordance with Irish law and generally accepted business practices in Ireland. |
• | The Company is exempt from provisions set forth in NASDAQ Rule 5635(c) which requires (other than for certain specified exceptions) shareholder approval prior to the establishment or material amendment of a stock option or purchase plan or other equity compensation arrangement made or materially amended, pursuant to which stock may be acquired by officers, Directors, employees or consultants. Irish law does not require shareholder approval with respect to equity compensation arrangements. Accordingly, the 2013 Employees Restricted Share Unit Plan and the amendments to the Employee Share Option Plan 2008 and Consultants Share Option Plan 2008 were adopted by the Board of Directors without shareholder approval. |
• | The Company is exempt from provisions set forth in NASDAQ Rule 5605(b)(2), which requires independent Directors to hold regularly scheduled meetings at which only independent Directors are present. Irish law does not require independent Directors to hold regularly scheduled meetings at which only independent Directors are present. The Company holds regularly scheduled meetings which all of the Directors may attend and the Lead Independent Director may call meetings of the independent directors and non-employee directors of the Board, as appropriate, in accordance with the Lead Independent Director Charter |
Average Rate | Closing Rate | |||
2017 | 2016 | 2017 | 2016 | |
Euro:USD | 1.1229 | 1.1060 | 1.2005 | 1.0517 |
Pound Sterling:USD | 1.2883 | 1.3684 | 1.3513 | 1.2340 |
Interest for the year ended December 31, 2017 (in thousands) | Interest Change 1% increase in market interest rate (in thousands) | Interest Change 1% decrease in market interest rate (in thousands) | |||||||
Interest Income | $ | 2,346 | $ | 5,441 | $ | — | |||
Interest Expense | $ | (12,627 | ) | $ | (12,627 | )* | $ | (12,627 | )* |
$ | (10,281 | ) | $ | (7,186 | ) | $ | (12,627 | ) |
12 month period ended December 31, 2017 (in thousands) | 12 month period ended December 31, 2016 (in thousands) | |||||||||
Audit fees (1) | $ | 1,556 | 42 | % | $ | 1,437 | 56 | % | ||
Audit related fees (2) | 1,297 | 35 | % | 153 | 6 | % | ||||
Tax fees (3) | 850 | 23 | % | 992 | 38 | % | ||||
Total | $ | 3,703 | 100 | % | $ | 2,582 | 100 | % |
Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of a Publicly Announced Plan | Total Price Paid for Shares Purchased as Part of a Publicly Announced Plan | Maximum Approximate Value of Shares that may yet be purchased under the Publicly Announced Plan | |||||||||
(in thousands, except per share data) | |||||||||||||
October 10/1/16– 10/31/16 | 474,118 | $ | 77.63 | 474,118 | $ | 36,804 | $ | 363,196 | |||||
November 11/1/16 – 11/30/16 | 756,001 | $ | 76.77 | 756,001 | $ | 58,039 | $ | 305,157 | |||||
December 12/1/16 – 12/31/16 | 199,068 | $ | 76.13 | 199,068 | $ | 15,157 | $ | 290,000 | |||||
January 1/1 /17– 1/31/17 | 152,601 | $ | 77.96 | 152,601 | $ | 11,897 | $ | 278,103 | |||||
February 2/1/17 – 2/28/17 | — | — | — | — | $ | 278,103 | |||||||
March 3/1/17 – 3/31/17 | 1,121,907 | $ | 79.08 | 1,121,907 | $ | 88,726 | $ | 189,377 | |||||
April 4/1/17 – 4/30/17 | 93,628 | $ | 79.92 | 93,628 | $ | 7,483 | $ | 181,894 | |||||
May 5/1/17 – 5/31/17 | — | — | — | — | $ | 181,894 | |||||||
June 6/1/17 – 6/30/17 | — | — | — | — | $ | 181,894 | |||||||
July 7/1/17 – 7/31/17 | — | — | — | — | $ | 181,894 | |||||||
August 8/1/17 – 8/31/17 | — | — | — | — | $ | 181,894 | |||||||
September 9/1/17 – 9/30/17 | — | — | — | — | $ | 181,894 | |||||||
October 10/1/17 – 10/31/17 | — | — | — | — | $ | 181,894 | |||||||
November 11/1/17 – 11/30/17 | 2,376 | $ | 114.49 | 2,376 | $ | 272 | $ | 181,622 | |||||
December 12/1/17 – 12/31/17 | 218,715 | $ | 113.06 | 218,715 | $ | 24,728 | $ | 156,894 | |||||
3,018,414 | $ | 80.54 | 3,018,414 | $ | 243,106 | $ | 156,894 |
Exhibit Number | Title | |
3.1 | Description of the Memorandum and Articles of Association of the Company (incorporated by reference to exhibit 99.2 to the Form 6K (File No. 333-08704) filed on July 25, 2016). | |
Section 302 certifications. | ||
Section 906 certifications. | ||
21.1 | List of Subsidiaries (incorporated by reference to Item 4 of Form 20-F filed herewith). | |
Consent of KPMG, Independent Registered Public Accounting Firm | ||
101.1* | Interactive Data Files (XBRL – Related Documents) |
December 31, 2017 | December 31, 2016 | |||
ASSETS | (in thousands) | |||
Current Assets: | ||||
Cash and cash equivalents | 282,859 | 192,541 | ||
Short term investments - available for sale (Note 3) | 77,589 | 68,046 | ||
Accounts receivable, net | 379,501 | 416,229 | ||
Unbilled revenue | 268,509 | 192,687 | ||
Other receivables | 33,798 | 32,044 | ||
Prepayments and other current assets | 34,377 | 35,170 | ||
Income taxes receivable (Note 13) | 24,385 | 21,241 | ||
Total current assets | 1,101,018 | 957,958 | ||
Other Assets: | ||||
Property, plant and equipment, net (Note 6) | 163,051 | 148,967 | ||
Goodwill (Note 4) | 769,058 | 616,088 | ||
Other non-current assets | 15,393 | 13,831 | ||
Non-current income taxes receivable (Note 13) | 18,396 | 12,698 | ||
Non-current deferred tax asset (Note 13) | 8,074 | 19,691 | ||
Intangible assets (Note 5) | 71,628 | 56,610 | ||
Total Assets | 2,146,618 | 1,825,843 | ||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||
Current Liabilities: | ||||
Accounts payable | 18,590 | 8,696 | ||
Payments on account | 298,992 | 272,757 | ||
Other liabilities (Note 7) | 233,503 | 190,727 | ||
Income taxes payable (Note 13) | 14,973 | 22,226 | ||
Total current liabilities | 566,058 | 494,406 | ||
Other Liabilities: | ||||
Non-current bank credit lines and loan facilities (Note 20) | 348,888 | 348,511 | ||
Non-current other liabilities (Note 8) | 17,111 | 23,752 | ||
Non-current government grants (Note 11) | 966 | 887 | ||
Non-current income taxes payable (Note 13) | 14,879 | 8,482 | ||
Non-current deferred tax liability (Note 13) | 7,716 | 4,631 | ||
Commitments and contingencies (Note 16) | — | — | ||
Total Liabilities | 955,618 | 880,669 | ||
Shareholders' Equity: | ||||
Ordinary shares, par value 6 euro cents per share; 100,000,000 shares authorized, (Note 12) | ||||
54,081,601 shares issued and outstanding at December 31, 2017 and 54,530,843 shares issued and outstanding at December 31, 2016. | 4,664 | 4,692 | ||
Additional paid-in capital | 481,337 | 438,126 | ||
Other undenominated capital (Note 12 (a)) | 912 | 809 | ||
Accumulated other comprehensive income (Note 19) | (38,713 | ) | (86,300 | ) |
Retained earnings | 742,800 | 587,847 | ||
Total Shareholders' Equity | 1,191,000 | 945,174 | ||
Total Liabilities and Shareholders' Equity | 2,146,618 | 1,825,843 |
Year Ended December 31, | |||||||||
2017 | 2016 | 2015 | |||||||
(in thousands, except share and per share data) | |||||||||
Revenue: | |||||||||
Gross revenue | $ | 2,402,321 | $ | 2,364,956 | $ | 2,161,618 | |||
Reimbursable expenses | (643,882 | ) | (698,469 | ) | (586,640 | ) | |||
Net revenue | 1,758,439 | 1,666,487 | 1,574,978 | ||||||
Costs and expenses: | |||||||||
Direct costs | 1,027,310 | 961,333 | 908,979 | ||||||
Selling, general and administrative | 323,741 | 325,726 | 326,786 | ||||||
Depreciation and amortization | 61,297 | 59,575 | 57,677 | ||||||
Restructuring and other items, net (Note 14) | 7,753 | 8,159 | — | ||||||
Total costs and expenses | 1,420,101 | 1,354,793 | 1,293,442 | ||||||
Income from operations | 338,338 | 311,694 | 281,536 | ||||||
Interest income | 2,346 | 1,484 | 1,306 | ||||||
Interest expense | (12,627 | ) | (13,006 | ) | (3,992 | ) | |||
Income before provision for income taxes | 328,057 | 300,172 | 278,850 | ||||||
Provision for income taxes (Note 13) | (46,569 | ) | (37,993 | ) | (39,311 | ) | |||
Net income | $ | 281,488 | $ | 262,179 | $ | 239,539 | |||
Net income per ordinary share: | |||||||||
Basic | $ | 5.20 | $ | 4.75 | $ | 4.08 | |||
Diluted | $ | 5.13 | $ | 4.65 | $ | 3.97 | |||
Weighted average number of ordinary shares outstanding: | |||||||||
Basic (Note 2 (u)) | 54,129,439 | 55,248,900 | 58,746,935 | ||||||
Diluted (Note 2 (u)) | 54,849,046 | 56,407,136 | 60,290,033 |
Year Ended December 31, | |||||||||
2017 | 2016 | 2015 | |||||||
(in thousands) | |||||||||
Net income | $ | 281,488 | $ | 262,179 | $ | 239,539 | |||
Other comprehensive income, net of tax | |||||||||
Currency translation adjustment | 33,966 | (12,839 | ) | (35,105 | ) | ||||
Currency impact of long-term funding | 13,730 | (8,428 | ) | 3,768 | |||||
Unrealized capital (loss)/gain– investments | (272 | ) | 11 | (54 | ) | ||||
Actuarial gain/(loss) on defined benefit pension plan | 50 | (2,485 | ) | 2,693 | |||||
Realized gain on interest rate hedge | — | — | 4,658 | ||||||
Amortization of interest rate hedge | (923 | ) | (923 | ) | (41 | ) | |||
Fair value of cash flow hedge | 1,036 | — | — | ||||||
Total comprehensive income | $ | 329,075 | $ | 237,515 | $ | 215,458 |
Shares | Amount | Additional Paid-in Capital | Other Undenominated Capital | Accumulated Other Comprehensive Income | Retained Earnings | Total | ||||||||||||||
Balance at December 31, 2014 | 60,106,780 | $ | 5,059 | $ | 327,212 | $ | 305 | $ | (37,555 | ) | $ | 655,185 | $ | 950,206 | ||||||
Comprehensive Income: | ||||||||||||||||||||
Net income | — | — | — | — | — | 239,539 | 239,539 | |||||||||||||
Currency translation adjustment | — | — | — | — | (35,105 | ) | — | (35,105 | ) | |||||||||||
Currency impact of long-term funding | — | — | — | — | 3,768 | — | 3,768 | |||||||||||||
Unrealized capital loss - investments | — | — | — | — | (54 | ) | — | (54 | ) | |||||||||||
Actuarial gain on defined benefit pension plan | — | — | — | — | 2,693 | — | 2,693 | |||||||||||||
Net gain on interest rate hedge | — | — | — | — | 4,617 | — | 4,617 | |||||||||||||
Total comprehensive income | — | — | — | — | — | — | 215,458 | |||||||||||||
Exercise of share options | 773,753 | 52 | 20,929 | — | — | — | 20,981 | |||||||||||||
Issue of restricted share units/ performance share units | 276,860 | 18 | — | — | — | — | 18 | |||||||||||||
Share based compensation expense | — | — | 33,317 | — | — | — | 33,317 | |||||||||||||
Share issue costs | — | — | (8 | ) | — | — | — | (8 | ) | |||||||||||
Repurchase of ordinary shares | (6,198,481 | ) | (410 | ) | — | 410 | — | (457,892 | ) | (457,892 | ) | |||||||||
Share repurchase costs | — | — | — | — | — | (889 | ) | (889 | ) | |||||||||||
Excess income tax benefit on exercise of equity compensation | — | — | 1,905 | — | — | — | 1,905 | |||||||||||||
Balance at December 31, 2015 | 54,958,912 | $ | 4,719 | $ | 383,355 | $ | 715 | $ | (61,636 | ) | $ | 435,943 | $ | 763,096 | ||||||
Comprehensive Income: | ||||||||||||||||||||
Net income | — | — | — | — | — | 262,179 | 262,179 | |||||||||||||
Currency translation adjustment | — | — | — | — | (12,839 | ) | — | (12,839 | ) | |||||||||||
Currency impact of long-term funding | — | — | — | — | (8,428 | ) | — | (8,428 | ) | |||||||||||
Unrealized capital gain - investments | — | — | — | — | 11 | — | 11 | |||||||||||||
Actuarial loss on defined benefit pension plan | — | — | — | — | (2,485 | ) | — | (2,485 | ) | |||||||||||
Amortization of interest rate hedge | — | — | — | — | (923 | ) | — | (923 | ) | |||||||||||
Total comprehensive income | — | — | — | — | — | — | 237,515 | |||||||||||||
Exercise of share options | 393,240 | 26 | 10,113 | — | — | — | 10,139 | |||||||||||||
Issue of restricted share units / performance share units | 607,878 | 41 | — | — | — | — | 41 | |||||||||||||
Share based compensation expense | — | — | 40,343 | — | — | — | 40,343 | |||||||||||||
Share issue costs | — | — | (17 | ) | — | — | — | (17 | ) | |||||||||||
Repurchase of ordinary shares | (1,429,187 | ) | (94 | ) | — | 94 | — | (110,000 | ) | (110,000 | ) | |||||||||
Share repurchase costs | — | — | — | — | — | (275 | ) | (275 | ) | |||||||||||
Excess income tax benefit on exercise of equity compensation (net of deferred tax) | — | — | 4,332 | — | — | — | 4,332 | |||||||||||||
Balance at December 31, 2016 | 54,530,843 | $ | 4,692 | $ | 438,126 | $ | 809 | $ | (86,300 | ) | $ | 587,847 | $ | 945,174 |
Shares | Amount | Additional Paid-in Capital | Other Undenominated Capital | Accumulated Other Comprehensive Income | Retained Earnings | Total | ||||||||||||||
Balance at December 31, 2016 | 54,530,843 | $ | 4,692 | $ | 438,126 | $ | 809 | $ | (86,300 | ) | $ | 587,847 | $ | 945,174 | ||||||
Comprehensive Income: | ||||||||||||||||||||
Net income | — | — | — | — | — | 281,488 | 281,488 | |||||||||||||
Currency translation adjustment | — | — | — | — | 33,966 | — | 33,966 | |||||||||||||
Currency impact of long-term funding | — | — | — | — | 13,730 | — | 13,730 | |||||||||||||
Unrealized capital loss - investments | — | — | — | — | (272 | ) | — | (272 | ) | |||||||||||
Actuarial gain on defined benefit pension plan | — | — | — | — | 50 | — | 50 | |||||||||||||
Amortization of interest rate hedge | — | — | — | — | (923 | ) | — | (923 | ) | |||||||||||
Fair value of cash flow hedge | — | — | — | — | 1,036 | — | 1,036 | |||||||||||||
Total comprehensive income | — | — | — | — | — | — | 329,075 | |||||||||||||
Exercise of share options | 458,243 | 31 | 13,875 | — | — | — | 13,906 | |||||||||||||
Issue of restricted share units / performance share units | 681,742 | 44 | — | — | — | — | 44 | |||||||||||||
Share based compensation expense | — | — | 29,351 | — | — | — | 29,351 | |||||||||||||
Share issue costs | — | — | (15 | ) | — | — | — | (15 | ) | |||||||||||
Repurchase of ordinary shares | (1,589,227 | ) | (103 | ) | — | 103 | — | (133,106 | ) | (133,106 | ) | |||||||||
Share repurchase costs | — | — | — | — | — | (106 | ) | (106 | ) | |||||||||||
Cumulative effect adjustment from adoption of ASU 2016-09 | — | — | — | — | — | 6,677 | 6,677 | |||||||||||||
Balance at December 31, 2017 | 54,081,601 | $ | 4,664 | $ | 481,337 | $ | 912 | $ | (38,713 | ) | $ | 742,800 | $ | 1,191,000 |
Year Ended December 31, | Year Ended December 31, | Year Ended December 31, | |||||||
2017 | 2016 | 2015 | |||||||
(in thousands) | |||||||||
Cash flows from operating activities: | |||||||||
Net income | $ | 281,488 | $ | 262,179 | $ | 239,539 | |||
Adjustments to reconcile net income to net cash | |||||||||
provided by operating activities: | |||||||||
Loss on disposal of property, plant and equipment | 228 | 151 | 55 | ||||||
Depreciation expense | 43,436 | 42,125 | 40,210 | ||||||
Amortization of intangibles | 17,861 | 17,450 | 17,467 | ||||||
Amortization of government grants | (44 | ) | (44 | ) | 53 | ||||
Interest on short term investments | (1,088 | ) | (823 | ) | (571 | ) | |||
Realized (gain)/loss on sale of short term investments | (112 | ) | (50 | ) | 113 | ||||
Amortization of gain on interest rate hedge | (923 | ) | (923 | ) | (41 | ) | |||
Amortization of financing costs | 556 | 566 | — | ||||||
Stock compensation expense | 30,573 | 40,343 | 33,317 | ||||||
Deferred taxes | 10,729 | 1,545 | 3,157 | ||||||
Changes in assets and liabilities: | |||||||||
Decrease/(increase) in accounts receivable | 57,747 | 2,526 | (18,671 | ) | |||||
Increase in unbilled revenue | (62,491 | ) | (16,753 | ) | (29,281 | ) | |||
Decrease/(increase) in other receivables | 1,771 | (1,829 | ) | (14,519 | ) | ||||
Decrease/(increase) in prepayments and other current assets | 4,359 | 1,872 | (8,631 | ) | |||||
Increase in other non-current assets | (1,524 | ) | (2,157 | ) | (55 | ) | |||
(Decrease)/increase in payments on account | (7,174 | ) | (45,754 | ) | 34,644 | ||||
Increase/(decrease) in other current liabilities | 6,679 | (44,713 | ) | (26,266 | ) | ||||
(Decrease)/increase in other non-current liabilities | (3,710 | ) | 3,008 | 6,378 | |||||
Decrease in income taxes payable | (2,293 | ) | (690 | ) | (949 | ) | |||
Increase in accounts payable | 7,014 | 1,175 | 3,124 | ||||||
Net cash provided by operating activities | 383,082 | 259,204 | 279,073 | ||||||
Cash flows from investing activities: | |||||||||
Purchase of property, plant and equipment | (44,717 | ) | (42,601 | ) | (49,730 | ) | |||
Purchase of subsidiary undertakings | (144,131 | ) | (54,209 | ) | (166,292 | ) | |||
Cash acquired with subsidiary undertaking | 19,649 | 3,168 | 194 | ||||||
Sale of short term investments | 33,086 | 40,858 | 25,708 | ||||||
Purchase of short term investments | (41,701 | ) | (22,030 | ) | (14,194 | ) | |||
Net cash used in investing activities | (177,814 | ) | (74,814 | ) | (204,314 | ) | |||
Cash flows from financing activities: | |||||||||
Drawdown of credit lines and facilities | — | 73,000 | 851,500 | ||||||
Repayment of credit lines and facilities | — | (73,000 | ) | (501,500 | ) | ||||
Proceeds from the exercise of equity compensation | 13,950 | 10,180 | 20,999 | ||||||
Share issue costs | (15 | ) | (17 | ) | (8 | ) | |||
Excess tax benefit on exercise of equity compensation | — | 6,402 | 1,905 | ||||||
Repurchase of ordinary shares | (133,106 | ) | (110,000 | ) | (457,892 | ) | |||
Share repurchase costs | (106 | ) | (275 | ) | (889 | ) | |||
Repayment of government grant | — | — | (159 | ) | |||||
Proceeds from interest rate hedge | — | — | 4,658 | ||||||
Net cash used in financing activities | (119,277 | ) | (93,710 | ) | (81,386 | ) | |||
Effect of exchange rate movements on cash | 4,327 | (2,050 | ) | (8,362 | ) | ||||
Net increase/(decrease) in cash and cash equivalents | 90,318 | 88,630 | (14,989 | ) | |||||
Cash and cash equivalents at beginning of year | 192,541 | 103,911 | 118,900 | ||||||
Cash and cash equivalents at end of year | $ | 282,859 | $ | 192,541 | $ | 103,911 |
Year ended December 31, (in thousands) | |||||||||
2017 | 2016 | 2015 | |||||||
Amounts charged/(credited) | $ | 7,760 | $ | 2,094 | $ | (3,608 | ) |
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. |
Years | |
Building | 40 |
Computer equipment and software | 2-8 |
Office furniture and fixtures | 8 |
Laboratory equipment | 5 |
Motor vehicles | 5 |
Year Ended December 31, | ||||||
2017 | 2016 | 2015 | ||||
Weighted average number of ordinary shares outstanding for basic net income per ordinary share | 54,129,439 | 55,248,900 | 58,746,935 | |||
Effect of dilutive share options outstanding | 719,607 | 1,158,236 | 1,543,098 | |||
Weighted average number of ordinary shares outstanding for diluted net income per ordinary share | 54,849,046 | 56,407,136 | 60,290,033 |
December 31, 2017 | December 31, 2016 | |||||
(in thousands) | ||||||
At start of year | $ | 68,046 | $ | 85,990 | ||
Purchases | 41,701 | 22,030 | ||||
Sales and maturities | (33,086 | ) | (40,858 | ) | ||
Interest on short term investments | 1,088 | 823 | ||||
Realized gain on sale of short term investments | 112 | 50 | ||||
Unrealized capital (loss)/gain – investments | (272 | ) | 11 | |||
At end of year | $ | 77,589 | $ | 68,046 |
Maturity by period | |||||||||||||||
Cost Total | Unrealized gains / (losses) | Fair Value Total | Less than 1 year | 1 to 5 years | |||||||||||
(U.S.$ in millions) | |||||||||||||||
US government debt securities | 13.95 | (0.11 | ) | 13.84 | 1.99 | 11.85 | |||||||||
Corporate securities | 62.61 | (0.19 | ) | 62.42 | 23.06 | 39.36 | |||||||||
Term deposits | 1.33 | — | 1.33 | 1.33 | — | ||||||||||
Total (U.S.$ in millions) | $ | 77.89 | $ | (0.30 | ) | $ | 77.59 | $ | 26.38 | $ | 51.21 |
December 31, 2017 | December 31, 2016 | |||||
(in thousands) | ||||||
Opening goodwill | $ | 616,088 | $ | 588,434 | ||
Current year acquisitions (note 4 (a)) | 129,222 | 34,576 | ||||
Prior period acquisition (note 4 (b)) | 1,393 | 7,689 | ||||
Foreign exchange movement | 22,355 | (14,611 | ) | |||
Closing goodwill | $ | 769,058 | $ | 616,088 |
July 27, | |||
2017 | |||
(in thousands) | |||
Cash | $ | 19,649 | |
Property, plant and equipment | 3,410 | ||
Goodwill* | 129,222 | ||
Intangible assets** | 32,305 | ||
Accounts receivable | 15,467 | ||
Unbilled revenue | 8,484 | ||
Prepayments and other current assets | 3,160 | ||
Other receivables | 1,430 | ||
Income taxes receivable | 4,262 | ||
Accounts payable | (3,166 | ) | |
Payments on account | (31,341 | ) | |
Other liabilities | (26,586 | ) | |
Non-current other liabilities | (1,061 | ) | |
Non-current deferred tax liability | (11,104 | ) | |
Net assets acquired | $ | 144,131 | |
Cash outflows | $ | 144,131 | |
Total consideration | $ | 144,131 |
Year Ended | ||||||
December 31, | ||||||
2017 | 2016 | |||||
(in thousands) | ||||||
Net revenue | $ | 1,811,018 | $ | 1,750,643 | ||
Net income | $ | 284,903 | $ | 263,101 | ||
Basic earnings per share | $ | 5.26 | $ | 4.76 | ||
Diluted earnings per share | $ | 5.19 | $ | 4.66 |
September 15, | |||
2016 | |||
(in thousands) | |||
Cash | $ | 3,168 | |
Property, plant and equipment | 939 | ||
Goodwill* | 35,969 | ||
Customer lists | 4,012 | ||
Order backlog | 1,668 | ||
Brand | 1,409 | ||
Accounts receivable | 11,431 | ||
Unbilled revenue | 3,868 | ||
Prepayments and other current assets | 1,673 | ||
Accounts payable | (165 | ) | |
Other liabilities | (5,569 | ) | |
Non-current other liabilities | (7 | ) | |
Net assets acquired | $ | 58,396 |
Cash outflows (including other liabilities assumed of $9.2 million) | $ | 52,396 | |
Assessment of valuation of contingent consideration at acquisition | 6,000 | ||
Net purchase consideration | $ | 58,396 |
Year Ended December 31, | ||||||
2016 | 2015 | |||||
(in thousands) | ||||||
Net revenue | $ | 1,713,245 | $ | 1,639,085 | ||
Net income | $ | 266,148 | $ | 244,167 | ||
Basic earnings per share | $ | 4.82 | $ | 4.16 | ||
Diluted earnings per share | $ | 4.72 | $ | 4.05 |
December 4, 2015 | |||
(in thousands) | |||
Cash | $ | 194 | |
Property, plant and equipment | 712 | ||
Goodwill* | 48,728 | ||
Customer lists | 6,938 | ||
Order backlog | 2,948 | ||
Accounts receivable | 11,597 | ||
Prepayments and other current assets | 1,329 | ||
Accounts payable | (530 | ) | |
Other liabilities | (3,456 | ) | |
Non-current deferred tax liability | (3,106 | ) | |
Net assets acquired | $ | 65,354 |
Cash consideration | $ | 53,681 | |
Other liabilities assumed | 10,060 | ||
Working capital adjustment | 1,613 | ||
Total cash outflows | $ | 65,354 |
Year Ended December 31, | ||||||
2015 | 2014 | |||||
(in thousands) | ||||||
Net revenue | $ | 1,601,891 | $ | 1,527,685 | ||
Net income | $ | 243,004 | $ | 172,390 | ||
Basic earnings per share | $ | 4.14 | $ | 2.80 | ||
Diluted earnings per share | $ | 4.03 | $ | 2.73 |
February 27, 2015 | |||
(in thousands) | |||
Property, plant and equipment | $ | 1,049 | |
Goodwill* | 92,084 | ||
Customer lists | 22,752 | ||
Order backlog | 2,521 | ||
Accounts receivable | 5,240 | ||
Unbilled Revenue | 4,324 | ||
Prepayments and other current assets | 621 | ||
Accounts payable | (749 | ) | |
Payments on account | (4,186 | ) | |
Deferred tax liability | (2,171 | ) | |
Other liabilities | (5,483 | ) | |
Net assets acquired | $ | 116,002 |
Cash consideration | $ | 108,717 | |
Other liabilities assumed** | 11,283 | ||
Gross cash outflows | 120,000 | ||
Working capital adjustment | (3,998 | ) | |
Net cash outflows | $ | 116,002 |
* | Goodwill represents the acquisition of an established workforce with experience in the provision of strategic payer-validated market access solutions while the acquisition of Complete Healthcare Communications comprises an established workforce with significant communication experience working with medical affairs, commercial and brand development teams within the life science industry. Goodwill related to the US portion of the business acquired is tax deductible. |
** | Payments made at acquisition date of $11.3 million were in respect of certain one-time liabilities at the acquisition date which have subsequently been discharged. |
Year Ended December 31, | ||||||
2015 | 2014 | |||||
(in thousands) | ||||||
Net revenue | $ | 1,581,816 | $ | 1,556,936 | ||
Net income | $ | 239,361 | $ | 179,289 | ||
Basic earnings per share | $ | 4.07 | $ | 2.92 | ||
Diluted earnings per share | $ | 3.97 | $ | 2.84 |
December 31, 2017 | December 31, 2016 | |||||
Cost | (in thousands) | |||||
Customer relationships acquired | $ | 91,230 | $ | 92,110 | ||
Technology asset acquired | 11,169 | 11,169 | ||||
Order backlog | 18,208 | 18,574 | ||||
Trade names/ brands acquired | 2,766 | 3,075 | ||||
Volunteer list acquired | 1,325 | 1,325 | ||||
Non-compete arrangements | 489 | 489 | ||||
Mapi intangible asset | 32,305 | — | ||||
Foreign exchange movement | (2,389 | ) | (6,578 | ) | ||
Total cost | 155,103 | 120,164 | ||||
Accumulated amortization | (84,898 | ) | (67,037 | ) | ||
Foreign exchange movement | 1,423 | 3,483 | ||||
Net book value | $ | 71,628 | $ | 56,610 |
Year Ended December 31,(in thousands) | |||
2018 | $ | 19,788 | |
2019 | 16,217 | ||
2020 | 13,867 | ||
2021 | 11,906 | ||
2022 | 6,580 | ||
$ | 68,358 |
December 31, 2017 | December 31, 2016 | |||||
(in thousands) | ||||||
Cost | ||||||
Land | $ | 3,464 | $ | 3,464 | ||
Building | 88,411 | 77,950 | ||||
Computer equipment and software | 358,874 | 315,984 | ||||
Office furniture and fixtures | 78,372 | 70,218 | ||||
Laboratory equipment | 34,918 | 31,487 | ||||
Leasehold improvements | 24,097 | 20,933 | ||||
Motor vehicles | 42 | 43 | ||||
588,178 | 520,079 | |||||
Less accumulated depreciation and asset write offs | (425,127 | ) | (371,112 | ) | ||
Property, plant and equipment (net) | $ | 163,051 | $ | 148,967 |
December 31, 2017 | December 31, 2016 | |||||
(in thousands) | ||||||
Personnel related liabilities | $ | 168,964 | $ | 135,349 | ||
Facility related liabilities | 13,061 | 14,182 | ||||
General overhead liabilities | 41,789 | 31,126 | ||||
Other liabilities | 4,628 | 7,584 | ||||
Short term government grants (note 11) | 35 | 54 | ||||
Restructuring and other items (note 14) | 5,026 | 2,432 | ||||
$ | 233,503 | $ | 190,727 |
December 31, 2017 | December 31, 2016 | |||||
(in thousands) | ||||||
Defined benefit pension obligations, net (note 9) | $ | 6,061 | $ | 8,952 | ||
Other non-current liabilities | 11,050 | 14,800 | ||||
$ | 17,111 | $ | 23,752 |
Funded status | December 31, 2017 | December 31, 2016 | ||||
(in thousands) | ||||||
Projected benefit obligation | $ | (37,759 | ) | $ | (32,906 | ) |
Fair value of plan assets | 32,423 | 24,876 | ||||
Funded status | $ | (5,336 | ) | $ | (8,030 | ) |
Non-current other liabilities (note 8) | $ | (5,336 | ) | $ | (8,030 | ) |
Change in benefit obligation | December 31, 2017 | December 31, 2016 | ||||
(in thousands) | ||||||
Benefit obligation at beginning of year | $ | 32,906 | $ | 27,369 | ||
Service cost | 112 | 75 | ||||
Interest cost | 929 | 1,017 | ||||
Plan participants' contributions | 22 | 22 | ||||
Expenses | (8 | ) | 8 | |||
Benefits paid | (68 | ) | (104 | ) | ||
Actuarial loss | 658 | 10,057 | ||||
Foreign currency exchange rate changes | 3,208 | (5,538 | ) | |||
Benefit obligation at end of year | $ | 37,759 | $ | 32,906 |
Change in plan assets | December 31, 2017 | December 31, 2016 | ||||
(in thousands) | ||||||
Fair value of plan assets at beginning of year | $ | 24,876 | $ | 23,367 | ||
Actual return on plan assets | 979 | 5,861 | ||||
Employer contributions | 4,008 | 108 | ||||
Plan participants' contributions | 22 | 22 | ||||
Benefits paid | (68 | ) | (104 | ) | ||
Foreign currency exchange rate changes | 2,606 | (4,378 | ) | |||
Fair value of plan assets at end of year | $ | 32,423 | $ | 24,876 |
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Service cost | $ | 112 | $ | 75 | $ | 78 | |||
Interest cost | 929 | 1,017 | 1,140 | ||||||
Expected return on plan assets | (586 | ) | (646 | ) | (661 | ) | |||
Amortization of net loss | 250 | — | 224 | ||||||
Expenses | (8 | ) | 8 | — | |||||
Net periodic benefit cost | $ | 697 | $ | 454 | $ | 781 |
December 31, 2017 | December 31, 2016 | December 31, 2015 | ||||
Discount rate | 2.7 | % | 4.0 | % | 3.6 | % |
Rate of compensation increase | 3.9 | % | 3.7 | % | 3.6 | % |
Expected rate of return on plan assets | 2.1 | % | 3.0 | % | 2.7 | % |
Other comprehensive income | December 31, 2017 | December 31, 2016 | December 31, 2015 | ||||||
(in thousands) | |||||||||
Actuarial loss/(gain) - benefit obligation | $ | 658 | $ | 10,057 | $ | (3,992 | ) | ||
Actuarial (gain)/loss – plan assets | (393 | ) | (5,215 | ) | 384 | ||||
Actuarial gain recognized in net periodic benefit cost | (250 | ) | — | (224 | ) | ||||
Total | $ | 15 | $ | 4,842 | $ | (3,832 | ) |
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Net actuarial loss | $ | 7,138 | $ | 7,123 | $ | 2,281 | |||
Total | $ | 7,138 | $ | 7,123 | $ | 2,281 |
December 31, 2017 | December 31, 2016 | |||
Discount rate | 2.5 | % | 2.7 | % |
Rate of compensation increase | 3.7 | % | 3.9 | % |
Asset Category | Expected long-term return per annum | |
Corporate Bonds | 2.5 | % |
Gilts | 1.8 | % |
Cash | 2.5 | % |
Asset Category | December 31, 2017 | December 31, 2016 | ||
Corporate Bonds | 22 | % | 25 | % |
Gilts | 65 | % | 75 | % |
Cash | 13 | % | — | % |
100 | % | 100 | % |
Quoted Prices in Active Markets for Identical Assets Level 1 (in thousands) | ||||||
December 31, 2017 | December 31, 2016 | |||||
Cash | $ | 4,086 | $ | 16 | ||
Fixed Income Securities | ||||||
Legal and General Active Corporate Bond – Over 10 Year | 7,188 | 6,095 | ||||
Legal and General Gilt Funds | 7,611 | 6,725 | ||||
Legal and General Index Linked Gilt Funds | 13,539 | 12,040 | ||||
$ | 32,424 | $ | 24,876 |
(in thousands) | |||
2018 | 336 | ||
2019 | 312 | ||
2020 | 330 | ||
2021 | 405 | ||
2022 | 436 | ||
Years 2023 - 2027 | $ | 3,297 |
Funded status | December 31, 2017 | December 31, 2016 | ||||
(in thousands) | ||||||
Projected benefit obligation | $ | (5,927 | ) | $ | (6,928 | ) |
Fair value of plan assets | 5,202 | 6,006 | ||||
Funded status | $ | (725 | ) | $ | (922 | ) |
Non-current other liabilities (note 8) | $ | (725 | ) | $ | (922 | ) |
Change in benefit obligation | December 31, 2017 | December 31, 2016 | ||||
(in thousands) | ||||||
Benefit obligation at beginning of year | $ | 6,928 | $ | 8,537 | ||
Service cost | 243 | 352 | ||||
Interest cost | 54 | 82 | ||||
Plan participants' contributions | 120 | 150 | ||||
Settlement | (1,019 | ) | (909 | ) | ||
Prior service cost | — | (88 | ) | |||
Transferred (benefits paid)/balances | (76 | ) | 53 | |||
Actuarial gain | (626 | ) | (1,157 | ) | ||
Foreign currency exchange rate changes | 303 | (92 | ) | |||
Benefit obligation at end of year | $ | 5,927 | $ | 6,928 |
Change in plan assets | December 31, | December 31, | ||||
2017 | 2016 | |||||
(in thousands) | ||||||
Fair value of plan assets at beginning of year | $ | 6,006 | $ | 5,350 | ||
Expected return on plan assets | 47 | 48 | ||||
Actual return on plan assets | (296 | ) | 1,233 | |||
Scheme contributions | 157 | 195 | ||||
Plan participants' contributions | 120 | 150 | ||||
Transferred (benefits paid)/balances | (76 | ) | 53 | |||
Settlement | (1,019 | ) | (909 | ) | ||
Foreign currency exchange rate changes | 263 | (114 | ) | |||
Fair value of plan assets at end of year | $ | 5,202 | $ | 6,006 |
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Service cost | $ | 243 | $ | 352 | $ | 402 | |||
Interest cost | 54 | 82 | 159 | ||||||
Expected return on plan assets | (47 | ) | (48 | ) | (119 | ) | |||
Amortization of net (gain)/loss | (43 | ) | 22 | — | |||||
Amortization of prior service credit | (8 | ) | (8 | ) | — | ||||
Settlement | (214 | ) | (136 | ) | — | ||||
Curtailment | — | — | 18 | ||||||
Net periodic benefit cost | $ | (15 | ) | $ | 264 | $ | 460 |
December 31, 2017 | December 31, 2016 | December 31, 2015 | ||||
Discount rate | 0.75 | % | 0.95 | % | 1.35 | % |
Rate of compensation increase | 2.0 | % | 2.0 | % | 2.00 | % |
Expected rate of return on plan assets | 0.75 | % | 0.95 | % | 1.35 | % |
Other comprehensive income | December 31, 2017 | December 31, 2016 | December 31, 2015 | ||||||
Actuarial (gain)/loss - benefit obligation | $ | (626 | ) | $ | (1,157 | ) | $ | 81 | |
Actuarial loss/(gain) – plan assets | 296 | (1,233 | ) | 1,075 | |||||
Prior service credit/(cost) recognized in net periodic benefit cost | 215 | 136 | (17 | ) | |||||
Actuarial gain/(loss) recognized in net periodic benefit cost | 43 | (22 | ) | — | |||||
Amortization of net prior service credit | 8 | 8 | — | ||||||
Net prior service credit occurring during the year | (1 | ) | (89 | ) | — | ||||
Total | $ | (65 | ) | $ | (2,357 | ) | $ | 1,139 |
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Net actuarial (gain)/loss | $ | (1,283 | ) | $ | (1,218 | ) | $ | 1,139 | |
Total | $ | (1,283 | ) | $ | (1,218 | ) | $ | 1,139 |
December 31, 2017 | December 31, 2016 | |||
Discount rate | 0.80 | % | 0.75 | % |
Rate of compensation increase | 2.0 | % | 2.0 | % |
(in thousands) | |||
2018 | 286 | ||
2019 | 224 | ||
2020 | 204 | ||
2021 | 201 | ||
2022 | 197 | ||
Years 2023 - 2027 | $ | 878 |
Options Granted Under Plans | Number of Shares | Weighted Average Exercise Price | Weighted Average Grant Date Fair Value | |||||||
Outstanding at December 31, 2014 | 2,227,700 | 2,227,700 | $ | 28.00 | $ | 10.40 | ||||
Granted | 259,059 | 259,059 | $ | 68.25 | $ | 19.75 | ||||
Exercised | (773,753 | ) | (773,753 | ) | $ | 27.13 | $ | 10.31 | ||
Cancelled | (86,424 | ) | (86,424 | ) | $ | 27.32 | $ | 10.31 | ||
Outstanding at December 31, 2015 | 1,626,582 | 1,626,582 | $ | 34.87 | $ | 11.94 | ||||
Granted | 256,191 | 256,191 | $ | 69.61 | $ | 20.10 | ||||
Exercised | (393,240 | ) | (393,240 | ) | $ | 25.79 | $ | 9.84 | ||
Cancelled | (23,089 | ) | (23,089 | ) | $ | 29.74 | $ | 11.19 | ||
Outstanding at December 31, 2016 | 1,466,444 | 1,466,444 | $ | 43.45 | $ | 13.94 | ||||
Granted | 219,113 | 219,113 | $ | 85.98 | $ | 25.06 | ||||
Exercised | (458,243 | ) | (458,243 | ) | $ | 30.35 | $ | 10.72 | ||
Cancelled | (55,921 | ) | (55,921 | ) | $ | 54.35 | $ | 16.76 | ||
Outstanding at December 31, 2017 | 1,171,393 | 1,171,393 | $ | 56.02 | $ | 17.15 | ||||
Vested and exercisable at December 31, 2017 | 476,666 | 476,666 | $ | 38.47 | $ | 12.95 |
Options Outstanding Number of Shares | Weighted Average Exercise Price | Weighted Average Fair Value | ||||||
Non-vested outstanding at December 31, 2016 | 814,870 | $ | 54.37 | $ | 16.55 | |||
Granted | 219,113 | 85.98 | 25.06 | |||||
Vested | (292,630 | ) | 44.54 | 14.39 | ||||
Forfeited | (46,626 | ) | 60.73 | 18.22 | ||||
Non-vested outstanding at December 31, 2017 | 694,727 | $ | 68.06 | $ | 20.03 |
Options Outstanding | Options Exercisable | ||||||||||||
Range Exercise Price | Number of Shares | Weighted Average Remaining Contractual Life | Weighted Average Exercise Price | Number of Shares | Weighted Average Exercise Price | ||||||||
$ | 20.28 | 63,824 | 1.16 | $ | 20.28 | 63,824 | $ | 20.28 | |||||
$ | 20.59 | 8,800 | 2.14 | $ | 20.59 | 8,800 | $ | 20.59 | |||||
$ | 22.30 | 84,137 | 2.32 | $ | 22.30 | 84,137 | $ | 22.30 | |||||
$ | 23.66 | 1,711 | 2.57 | $ | 23.66 | 1,711 | $ | 23.66 | |||||
$ | 24.46 | 7,692 | 0.17 | $ | 24.46 | 7,692 | $ | 24.46 | |||||
$ | 26.20 | 450 | 0.38 | $ | 26.20 | 450 | $ | 26.20 | |||||
$ | 26.71 | 4,450 | 2.69 | $ | 26.71 | 4,450 | $ | 26.71 | |||||
$ | 32.37 | 159,686 | 3.33 | $ | 32.37 | 124,476 | $ | 32.37 | |||||
$ | 36.22 | 5,923 | 3.46 | $ | 36.22 | 3,323 | $ | 36.22 | |||||
$ | 37.90 | 2,520 | 3.93 | $ | 37.90 | 460 | $ | 37.90 | |||||
$ | 40.83 | 72,634 | 4.39 | $ | 40.83 | 37,026 | $ | 40.83 | |||||
$ | 47.03 | 39,477 | 4.17 | $ | 47.03 | 9,626 | $ | 47.03 | |||||
$ | 48.67 | 80,039 | 4.21 | $ | 48.67 | 21,160 | $ | 48.67 | |||||
$ | 51.35 | 2,030 | 4.60 | $ | 51.35 | 418 | $ | 51.35 | |||||
$ | 65.60 | 91,549 | 6.38 | $ | 65.60 | 26,161 | $ | 65.60 | |||||
$ | 66.47 | 6,717 | 5.39 | $ | 66.47 | 1,698 | $ | 66.47 | |||||
$ | 66.97 | 1,872 | 5.45 | $ | 66.97 | — | $ | 66.97 | |||||
$ | 68.39 | 190,821 | 5.18 | $ | 68.39 | 65,178 | $ | 68.39 | |||||
$ | 71.95 | 133,256 | 6.17 | $ | 71.95 | 16,076 | $ | 71.95 | |||||
$ | 83.47 | 130,836 | 7.17 | $ | 83.47 | — | $ | 83.47 | |||||
$ | 90.03 | 82,969 | 7.38 | $ | 90.03 | — | $ | 90.03 | |||||
$20.28 - $90.03 | 1,171,393 | 4.86 | $ | 56.02 | 476,666 | $ | 38.47 |
Year Ended | |||||||||
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
Weighted average fair value | $ | 25.06 | $ | 20.10 | $ | 19.75 | |||
Assumptions: | |||||||||
Expected volatility | 29 | % | 30 | % | 30 | % | |||
Dividend yield | — | % | — | % | — | % | |||
Risk-free interest rate | 1.93 | % | 1.39 | % | 1.58 | % | |||
Expected life | 5.0 years | 5.0 years | 5.0 years |
PSU Outstanding Number of Shares | PSU Weighted Average Fair Value | PSU Weighted Average Remaining Contractual Life | RSU Outstanding Number of Shares | RSU Weighted Average Fair Value | RSU Weighted Average Remaining Contractual Life | |||||||
Outstanding at December 31, 2016 | 830,523 | $ | 60.73 | 1.11 | 1,025,484 | $ | 58.64 | 1.40 | ||||
Granted | 68,040 | $ | 84.10 | 186,102 | $ | 89.60 | ||||||
Shares vested | (320,640 | ) | $ | 46.63 | (367,177 | ) | $ | 45.18 | ||||
Forfeited | (66,897 | ) | $ | 67.16 | (128,439 | ) | $ | 63.89 | ||||
Outstanding at December 31, 2017 | 511,026 | $ | 72.07 | 0.93 | 715,970 | $ | 72.65 | 1.28 |
Year ended | |||||||||
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Direct costs | $ | 18,020 | $ | 21,903 | $ | 18,358 | |||
Selling, general and administrative | $ | 12,553 | $ | 18,440 | $ | 14,959 | |||
Total compensation costs | $ | 30,573 | $ | 40,343 | $ | 33,317 |
December 31, 2017 | December 31, 2016 | |||||
(in thousands) | ||||||
Received | $ | 3,539 | $ | 3,539 | ||
Less accumulated amortization | (2,745 | ) | (2,701 | ) | ||
Foreign exchange translation adjustment | 207 | 103 | ||||
Total government grants | 1,001 | 941 | ||||
Less current portion | (35 | ) | (54 | ) | ||
Non-current government grants | $ | 966 | $ | 887 |
(a) | Share Repurchase Program |
Year ended | |||||||||
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Ireland | $ | 218,306 | $ | 201,221 | $ | 184,643 | |||
United States | 28,426 | 11,466 | 15,436 | ||||||
Other | 81,325 | 87,485 | 78,771 | ||||||
Income before provision for income taxes | $ | 328,057 | $ | 300,172 | $ | 278,850 |
Year ended | |||||||||
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Provision for income taxes: | |||||||||
Current tax expense: | |||||||||
Ireland | $ | 20,084 | $ | 22,931 | $ | 21,769 | |||
United States | 5,792 | 7,768 | 684 | ||||||
Other | 9,964 | 5,749 | 13,701 | ||||||
Total current tax expense | 35,840 | 36,448 | 36,154 | ||||||
Deferred tax expense/(benefit): | |||||||||
Ireland | 261 | 1,284 | 26 | ||||||
United States | 8,980 | 613 | 2,896 | ||||||
Other | 1,488 | (352 | ) | 235 | |||||
Total deferred tax expense | 10,729 | 1,545 | 3,157 | ||||||
Provision for income taxes | 46,569 | 37,993 | 39,311 | ||||||
Impact on shareholders equity and other comprehensive income of the tax consequence of : | |||||||||
Excess tax benefit on stock compensation | — | (4,332 | ) | (1,905 | ) | ||||
Currency impact on long term funding | 973 | (396 | ) | 3,574 | |||||
Fair value of cash flow hedge | 148 | — | — | ||||||
Total | $ | 47,690 | $ | 33,265 | $ | 40,980 |
Year ended | |||||||||
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Taxes at Irish statutory rate of 12.5% (2016:12.5%; 2015:12.5%) | $ | 41,007 | $ | 37,522 | $ | 34,856 | |||
Foreign and other income taxed at higher rates | 6,324 | 4,642 | 4,614 | ||||||
Research & development tax incentives | (830 | ) | (907 | ) | (695 | ) | |||
Movement in valuation allowance | 1,329 | 1,208 | (4,133 | ) | |||||
Effects of change in tax rates | 925 | 576 | (16 | ) | |||||
Increase/(decrease) in unrecognized tax benefits | 933 | (1,521 | ) | 5,085 | |||||
Impact of stock compensation | (9,917 | ) | (4,121 | ) | (3,468 | ) | |||
Impact of mandatory repatriation under US Tax Reform | 7,694 | — | — | ||||||
Other | (896 | ) | 594 | 3,068 | |||||
Provision for income taxes | $ | 46,569 | $ | 37,993 | $ | 39,311 |
December 31, 2017 | December 31, 2016 | |||||
(in thousands) | ||||||
Deferred tax liabilities: | ||||||
Property, plant and equipment | $ | 1,139 | $ | 979 | ||
Goodwill | 22,655 | 26,617 | ||||
Other intangible assets | 11,801 | 6,700 | ||||
Other | 4,139 | 1,441 | ||||
Total deferred tax liabilities recognized | 39,734 | 35,737 | ||||
Deferred tax assets: | ||||||
Operating loss and tax credits carryforwards | 24,962 | 22,705 | ||||
Property, plant and equipment | 4,062 | 3,121 | ||||
Accrued expenses and payments on account | 24,433 | 28,904 | ||||
Stock compensation | 5,786 | 13,062 | ||||
Deferred compensation expense | 2,548 | 3,327 | ||||
Other | 740 | 15 | ||||
Total deferred tax assets | 62,531 | 71,134 | ||||
Valuation allowance for deferred tax assets | (22,439 | ) | (20,337 | ) | ||
Deferred tax assets recognized | 40,092 | 50,797 | ||||
Overall net deferred tax asset | $ | 358 | $ | 15,060 |
Federal NOL's | State NOL's | |||||
(in thousands) | ||||||
2018 | 113 | — | ||||
2021-2034 | 24,041 | 14,945 | ||||
2035-2036 | 812 | 28,703 | ||||
$ | 24,966 | $ | 43,648 |
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Unrecognized tax benefits at start of year | $ | 26,620 | $ | 28,166 | $ | 23,201 | |||
Increase related to acquired tax positions | — | — | 778 | ||||||
Increase related to prior year tax positions | — | 1,151 | 1,482 | ||||||
Decrease related to prior year tax positions | (3,050 | ) | (2,483 | ) | (315 | ) | |||
Increase related to current year tax positions | 4,765 | 1,104 | 3,063 | ||||||
Settlements | (2,523 | ) | (837 | ) | — | ||||
Lapse of statute of limitations | (2,092 | ) | (481 | ) | (43 | ) | |||
Unrecognized tax benefits at end of year | $ | 23,720 | $ | 26,620 | $ | 28,166 |
Year Ended | ||||||||
December 31, 2017 | December 31, 2016 | December 31, 2015 | ||||||
(in thousands) | ||||||||
Restructuring charges | $ | 7,753 | 8,159 | $ | — | |||
Net charge | $ | 7,753 | 8,159 | $ | — |
Workforce reductions | |||
(in thousands) | |||
Total provision recognized | $ | 7,753 | |
Utilized | (4,656 | ) | |
Foreign exchange | — | ||
Provision at December 31, 2017 | $ | 3,097 |
Workforce Reductions | Onerous Lease | Total | |||||||
(in thousands) | |||||||||
Total provision recognized | $ | 6,190 | $ | 1,969 | $ | 8,159 | |||
Utilized | (5,734 | ) | (571 | ) | (6,305 | ) | |||
Foreign exchange | $ | (63 | ) | — | $ | (63 | ) | ||
Provision at December 31, 2016 | $ | 393 | $ | 1,398 | $ | 1,791 | |||
Utilized | (393 | ) | (1,081 | ) | (1,474 | ) | |||
Provision at December 31, 2017 | $ | — | $ | 317 | $ | 317 |
Onerous Lease | Asset Impairment | Total | |||||||
(in thousands) | |||||||||
Total provision recognized | $ | 3,167 | $ | 5,629 | $ | 8,796 | |||
Asset write off | — | (5,629 | ) | (5,629 | ) | ||||
Provision at December 31, 2014 | $ | 3,167 | $ | — | $ | 3,167 | |||
Utilized | (1,167 | ) | — | (1,167 | ) | ||||
Provision at December 31, 2015 | $ | 2,000 | $ | — | $ | 2,000 | |||
Utilized | (1,359 | ) | — | (1,359 | ) | ||||
Provision at December 31, 2016 | $ | 641 | $ | — | $ | 641 | |||
Utilized | (441 | ) | — | (441 | ) | ||||
Provision at December 31, 2017 | $ | 200 | $ | — | $ | 200 |
December 31, 2017 | December 31, 2016 | |||||
(in thousands) | ||||||
Opening provision | $ | 9,450 | $ | 10,383 | ||
Amounts used during the year | (2,733 | ) | (3,782 | ) | ||
Amounts provided during the year | 5,116 | 4,651 | ||||
Amounts released during the year | (3,106 | ) | (1,814 | ) | ||
Foreign exchange | 203 | 12 | ||||
Closing provision | $ | 8,930 | $ | 9,450 |
Minimum rental payments | |||
(in thousands) | |||
2018 | 38,111 | ||
2019 | 32,575 | ||
2020 | 26,336 | ||
2021 | 19,079 | ||
2022 | 13,389 | ||
Thereafter | 36,692 | ||
Total | $ | 166,182 |
Year ended | |||||||||
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Ireland | $ | 424,292 | $ | 410,572 | $ | 429,631 | |||
Rest of Europe | 337,105 | 313,185 | 330,487 | ||||||
U.S. | 791,543 | 763,821 | 650,941 | ||||||
Other | 205,499 | 178,909 | 163,919 | ||||||
Total | $ | 1,758,439 | $ | 1,666,487 | $ | 1,574,978 |
Year ended | |||||||||
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Ireland | $ | 232,032 | $ | 216,149 | $ | 189,035 | |||
Rest of Europe | 26,493 | 34,200 | 38,166 | ||||||
U.S. | 58,322 | 41,348 | 45,320 | ||||||
Other | 21,491 | 19,997 | 9,015 | ||||||
Total | $ | 338,338 | $ | 311,694 | $ | 281,536 |
Year ended | |||||||||
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Ireland | $ | 240,115 | $ | 218,334 | $ | 189,035 | |||
Rest of Europe | 26,351 | 36,509 | 38,166 | ||||||
U.S. | 58,164 | 44,590 | 45,320 | ||||||
Other | 21,461 | 20,420 | 9,015 | ||||||
Total | $ | 346,091 | $ | 319,853 | $ | 281,536 |
December 31, 2017 | December 31, 2016 | |||||
(in thousands) | ||||||
Ireland | $ | 111,329 | $ | 105,684 | ||
Rest of Europe | 9,026 | 6,231 | ||||
U.S. | 27,797 | 29,428 | ||||
Other | 14,899 | 7,624 | ||||
Total | $ | 163,051 | $ | 148,967 |
Year ended | |||||||||
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Ireland | $ | 26,277 | $ | 25,766 | $ | 22,100 | |||
Rest of Europe | 6,857 | 6,914 | 11,055 | ||||||
U.S. | 24,246 | 23,462 | 20,106 | ||||||
Other | 3,917 | 3,433 | 4,416 | ||||||
Total | $ | 61,297 | $ | 59,575 | $ | 57,677 |
December 31, 2017 | December 31, 2016 | |||||
(in thousands) | ||||||
Ireland | $ | 880,378 | $ | 766,120 | ||
Rest of Europe | 504,418 | 337,062 | ||||
U.S. | 650,681 | 651,160 | ||||
Other | 111,141 | 71,501 | ||||
Total | $ | 2,146,618 | $ | 1,825,843 |
Year ended | |||||||||
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Ireland | $ | 24,468 | $ | 27,670 | $ | 30,900 | |||
Rest of Europe | 2,819 | 2,851 | 1,916 | ||||||
U.S. | 11,027 | 8,432 | 15,256 | ||||||
Other | 6,403 | 3,648 | 1,658 | ||||||
Total | $ | 44,717 | $ | 42,601 | $ | 49,730 |
Year ended | ||||||
December 31, 2017 | December 31, 2016 | December 31, 2015 | ||||
Client A | 18 | % | 26 | % | 31 | % |
Year ended | |||||||||
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Ireland | $ | 1,084 | $ | 407 | $ | 102 | |||
Rest of Europe | 1,222 | 1,040 | 1,151 | ||||||
U.S. | 16 | 2 | 4 | ||||||
Other | 24 | 35 | 49 | ||||||
Total | $ | 2,346 | $ | 1,484 | $ | 1,306 |
Year ended | |||||||||
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Ireland | $ | 20,345 | $ | 24,215 | $ | 21,795 | |||
Rest of Europe | 1,921 | 5,528 | 8,007 | ||||||
U.S. | 14,772 | 8,381 | 3,580 | ||||||
Other | 9,531 | (131 | ) | 5,929 | |||||
Total | $ | 46,569 | $ | 37,993 | $ | 39,311 |
Year ended | |||||||||
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||
(in thousands) | |||||||||
Cash paid for interest | $ | 13,094 | $ | 13,615 | $ | 2,175 | |||
Cash paid for income taxes | $ | 12,305 | $ | 10,205 | $ | 14,829 |
December 31, 2017 | December 31, 2016 | |||||
(in thousands) | ||||||
Currency translation adjustments | $ | (36,188 | ) | $ | (70,154 | ) |
Currency impact on long term funding (Net of tax) | (182 | ) | (13,912 | ) | ||
Actuarial loss on defined benefit pension plan (note 9) | (5,855 | ) | (5,905 | ) | ||
Unrealized capital loss – investments (note 3) | (295 | ) | (23 | ) | ||
Realized gain on interest rate hedge | 4,658 | 4,658 | ||||
Amortization of interest rate hedge | (1,887 | ) | (964 | ) | ||
Fair value of cash flow hedge | 1,036 | — | ||||
Total | $ | (38,713 | ) | $ | (86,300 | ) |
• | If an entity had early adopted the new revenue standard before this ASU was issued (May 16, 2017), the entity may adopt this ASU on its effective date with certain specific transition provisions. |
• | If an entity early adopts the new revenue standard after this ASU was issued, the entity must adopt this ASU at the same time as the new revenue standard with certain specific transition provisions. |
• | An entity may elect to early adopt this ASU before the adoption of the new revenue standard with certain specific transition provisions. |
• | Debt prepayment or debt extinguishment costs; |
• | Settlement of zero-coupon bonds; |
• | Contingent consideration payments made after a business combination; |
• | Proceeds from the settlement of insurance claims; |
• | Proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; |
• | Distributions received from equity method investees; |
• | Beneficial interests in securitization transactions; and |
• | Separately identifiable cash flows and application of the predominance principle. |
• | Eliminating the requirement to separately measure and report hedge ineffectiveness; and |
• | Presenting all items that affect earnings in the same income statement line item as the hedged item. |
• | Applying hedge accounting to additional hedging strategies; |
• | Measuring the hedged item in fair value hedges of interest rate risk; |
• | Reducing the cost and complexity of applying hedge accounting by easing the requirements for effectiveness testing, hedge documentation and application of the critical terms match method; and |
• | Reducing the risk of material error correction if a company applies the shortcut method inappropriately. |
ICON plc | ||
/s/ Brendan Brennan | ||
Brendan Brennan | ||
Chief Financial Officer |
Exhibit Number | Title | |
3.1 | Description of the Memorandum and Articles of Association of the Company (incorporated by reference to exhibit 99.2 to the Form 6K (File No. 333-08704) filed on July 25, 2016). | |
12.1* | Section 302 certifications. | |
12.2* | Section 906 certifications. | |
21.1 | List of Subsidiaries (incorporated by reference to Item 4 of Form 20-F filed herewith). | |
23.1* | Consent of KPMG, Independent Registered Public Accounting Firm | |
101.1* | Interactive Data Files (XBRL – Related Documents) |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company's internal control over financial reporting. |
/s/ Brendan Brennan | |
Brendan Brennan | |
Chief Financial Officer |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company's internal control over financial reporting. |
/s/ Steve Cutler | |
Steve Cutler | |
Chief Executive Officer |
/s/ Brendan Brennan | |
Brendan Brennan | |
Chief Financial Officer |
/s/ Steve Cutler | |
Steve Cutler | |
Chief Executive Officer |
Document and Entity Information |
12 Months Ended |
---|---|
Dec. 31, 2017
shares
| |
Document And Entity Information [Abstract] | |
Document Type | 20-F |
Amendment Flag | false |
Document Period End Date | Dec. 31, 2017 |
Document Fiscal Year Focus | 2017 |
Document Fiscal Period Focus | FY |
Trading Symbol | ICLR |
Entity Registrant Name | ICON PLC |
Entity Central Index Key | 0001060955 |
Current Fiscal Year End Date | --12-31 |
Entity Current Reporting Status | Yes |
Entity Well-known Seasoned Issuer | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Common Stock, Shares Outstanding | 54,081,601 |
Consolidated Balance Sheets (Parenthetical) - € / shares |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Ordinary shares, par value (euro per share) | € 0.06 | € 0.06 |
Ordinary shares, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Ordinary shares, shares issued (in shares) | 54,081,601 | 54,530,843 |
Ordinary shares, shares outstanding (in shares) | 54,081,601 | 54,530,843 |
Consolidated Statements of Operations - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Revenue: | |||
Gross revenue | $ 2,402,321 | $ 2,364,956 | $ 2,161,618 |
Reimbursable expenses | (643,882) | (698,469) | (586,640) |
Net revenue | 1,758,439 | 1,666,487 | 1,574,978 |
Costs and expenses: | |||
Direct costs | 1,027,310 | 961,333 | 908,979 |
Selling, general and administrative | 323,741 | 325,726 | 326,786 |
Depreciation and amortization | 61,297 | 59,575 | 57,677 |
Restructuring and other items, net (Note 14) | 7,753 | 8,159 | 0 |
Total costs and expenses | 1,420,101 | 1,354,793 | 1,293,442 |
Income from operations | 338,338 | 311,694 | 281,536 |
Interest income | 2,346 | 1,484 | 1,306 |
Interest expense | (12,627) | (13,006) | (3,992) |
Income before provision for income taxes | 328,057 | 300,172 | 278,850 |
Provision for income taxes (Note 13) | (46,569) | (37,993) | (39,311) |
Net income | $ 281,488 | $ 262,179 | $ 239,539 |
Net income per ordinary share: | |||
Basic (dollars per share) | $ 5.20 | $ 4.75 | $ 4.08 |
Diluted (dollars per share) | $ 5.13 | $ 4.65 | $ 3.97 |
Weighted average number of ordinary shares outstanding: | |||
Basic (in shares) | 54,129,439 | 55,248,900 | 58,746,935 |
Diluted (in shares) | 54,849,046 | 56,407,136 | 60,290,033 |
Consolidated Statements Of Comprehensive Income - USD ($) $ in Thousands |
12 Months Ended | ||
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Dec. 31, 2016 |
Dec. 31, 2015 |
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Statement of Comprehensive Income [Abstract] | |||
Net income | $ 281,488 | $ 262,179 | $ 239,539 |
Currency translation adjustment | 33,966 | (12,839) | (35,105) |
Currency impact of long-term funding | 13,730 | (8,428) | 3,768 |
Unrealized capital (loss)/gain– investments | (272) | 11 | (54) |
Actuarial gain/(loss) on defined benefit pension plan | 50 | (2,485) | 2,693 |
Realized gain on interest rate hedge | 0 | 0 | 4,658 |
Amortization of interest rate hedge | (923) | (923) | (41) |
Fair value of cash flow hedge | 1,036 | 0 | 0 |
Total comprehensive income | $ 329,075 | $ 237,515 | $ 215,458 |
Description of business |
12 Months Ended |
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Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Description of business | Description of business ICON plc and its subsidiaries ("the Company" or "ICON") is a clinical research organization ("CRO"), providing outsourced development services on a global basis to the pharmaceutical, biotechnology and medical device industries. We specialize 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. Our vision is to be the Global CRO partner of choice in drug development by delivering best in class information, solutions and performance in clinical and outcomes research. We believe that we are one of a select group of CROs with the expertise and capability to conduct clinical trials in most major therapeutic areas on a global basis and have the operational flexibility to provide development services on a stand-alone basis or as part of an integrated "full service" solution. At December 31, 2017 we had approximately 13,250 employees, in 98 locations in 38 countries. During the year ended December 31, 2017, we derived approximately 45.0%, 43.3% and 11.7% of our net revenue in the United States, Europe and Rest of World, respectively. We began operations in 1990 and have expanded our business predominately through internal growth, together with a number of strategic acquisitions to enhance our capabilities and expertise in certain areas of the clinical development process. We are incorporated in Ireland and our principal executive office is located at: South County Business Park, Leopardstown, Dublin 18, Republic of Ireland. The contact telephone number of this office is +353 1 2912000. |
Significant Accounting Policies |
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Significant Accounting Policies | Significant Accounting Policies The accounting policies noted below were applied in the preparation of the accompanying financial statements of the Company and are in conformity with accounting principles generally accepted in the United States. (a) Basis of consolidation The consolidated financial statements include the financial statements of the Company and all of its subsidiaries. All significant intercompany profits, transactions and account balances have been eliminated. The results of subsidiary undertakings acquired in the period are included in the Consolidated Statement of Operations from the date of acquisition. (b) Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates. The principal management estimates and judgments used in preparing the financial statements relate to revenue recognition and taxation. (c) Revenue recognition The Company primarily 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, biometric activities, consulting, imaging, contract staffing, informatics and laboratory services. Contracts range in duration from a number of months to several years. Revenue for services, as rendered, is recognized only after persuasive evidence of an arrangement exists, the sales price is fixed or determinable and collectability is reasonably assured. Clinical trials management revenue is recognized on a proportional performance method. Depending on the contractual terms revenue is either recognized on the percentage of completion method based on the relationship between hours incurred and the total estimated hours of the trial or on the unit of delivery method. Contract costs equate to the product of labor hours incurred and compensation rates. For the percentage of completion method, the input (effort expended) method has been used to measure progress towards completion as there is a direct relationship between input and productivity. Contract revenue is the product of the aggregated labor hours required to complete the specified contract tasks at the agreed contract rates. The Company regularly reviews the estimate of total contract time to ensure such estimates remain appropriate taking into account actual contract stage of completion, remaining time to complete and any identified changes to the contract scope. Remaining time to complete depends on the specific contract tasks, the complexity of the contract and can include geographical site selection and initiation, patient enrollment, patient testing and level of results analysis required. While the Company may routinely adjust time estimates, the Company's estimates and assumptions historically have been accurate in all material respects in the aggregate. Where revenue is recognized on the unit of delivery method, the basis applied is the number of units completed as a percentage of the total number of contractual units. Biometrics revenue is recognized on a fee-for-service method as each unit of data is prepared on the basis of the number of units completed in a period as a percentage of the total number of contracted units. Imaging revenue is recognized on a fee-for-service basis recognizing revenue for each image completed. Consulting revenue is recognized on a fee-for-service basis as each hour of the related service is performed. Contract staffing revenue is recognized on a fee-for-service basis, over the time the related service is performed, or in the case of permanent placement, once the candidate has been placed with the client. Informatics revenue is recognized on a fee-for-service basis. Informatics contracts are treated as multiple element arrangements, with contractual elements comprising license fee revenue, support fee revenue and revenue from software services, each of which can be sold separately. Sales prices for contractual elements are determined by reference to objective and reliable evidence of their sales price. License and support fee revenues are recognized rateably over the period of the related agreement. Revenue from software services is recognized using the percentage of completion method based on the relationship between hours incurred and the total estimated hours required to perform the service. Laboratory service revenue is recognized on a fee-for-service basis. The Company accounts for laboratory service contracts as multiple element arrangements, with contractual elements comprising laboratory kits and laboratory testing, each of which can be sold separately. Sales prices for contractual elements are determined by reference to objective and reliable evidence of their sales price. Revenues for contractual elements are recognized on the basis of the number of deliverable units completed in the period. Contracts generally contain provisions for renegotiation in the event of changes in the scope, nature, duration, or volume of services of the contract. Renegotiated amounts are recognized as revenue by revision to the total contract value arising as a result of an authorized customer change order. The difference between the amount of revenue recognized and the amount billed on a particular contract is included in the Consolidated Balance Sheet as unbilled revenue or payments on account. Normally, amounts become billable upon the achievement of certain milestones, for example, target patient enrollment rates, clinical testing sites initiated or case report forms completed. Once the milestone target is reached, amounts become billable in accordance with pre-agreed payment schedules included in the contract or on submission of appropriate billing detail. Such cash payments are not representative of revenue earned on the contract as revenues are recognized over the period in which the specified contractual obligations are fulfilled. Amounts included in unbilled revenue are expected to be collected within one year and are included within current assets. Advance billings to customers, for which revenue has not been recognized, are recognized as payments on account within current liabilities. In the event of contract termination, if the value of work performed and recognized as revenue is greater than aggregate milestone billings at the date of termination, cancellation clauses usually ensure that the Company is paid for all work performed to the termination date. (d) Reimbursable expenses Reimbursable expenses comprise investigator payments and certain other costs which are reimbursed by clients under terms specific to each contract and are deducted from gross revenue in arriving at net revenue. Investigator payments are accrued based on patient enrollment over the life of the contract. Investigator payments are made based on predetermined contractual arrangements, which may differ from the accrual of the expense. (e) Direct costs Direct costs consist of compensation, associated employee benefits and share-based payments for project-related employees and other direct project-related costs. (f) Advertising costs All costs associated with advertising and promotion are expensed as incurred. The advertising and promotion costs were $6,744,333, $7,167,050 and $4,513,750 for the years ended December 31, 2017, December 31, 2016 and December 31, 2015 respectively. (g) Foreign currencies and translation of subsidiaries The Company's financial statements are prepared in United States dollars. Transactions in currencies other than United States dollars are recorded at the rate ruling at the date of the transaction. Monetary assets and liabilities denominated in currencies other than United States dollars are translated into United States dollars at exchange rates prevailing at the Balance Sheet date. Adjustments resulting from these translations are charged or credited to income. Amounts charged or credited to the Consolidated Statement of Operations for the years ended December 31, 2017, December 31, 2016 and December 31, 2015 were as follows:
The financial statements of subsidiaries with other functional currencies are translated at period end rates for the Consolidated Balance Sheet and average rates for the Consolidated Statement of Operations. Translation gains and losses arising are reported as a movement on accumulated other comprehensive income. Foreign currency transaction gains and losses are reporting in other comprehensive income rather than through income where the foreign currency transaction is 'long-term investment' in nature i.e. settlement is not planned or anticipated in the foreseeable future. (h) Disclosure about fair value of financial instruments Cash, cash equivalents, unbilled revenue, other receivables, short term investments, prepayments and other current assets, accounts receivable, accounts payable, investigator payments, payments on account, accrued liabilities, accrued bonuses 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. Financial instruments are measured in the Consolidated Balance Sheet fair value using a fair value hierarchy of valuation inputs. The 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:
The Company classifies its short term 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 Consolidated Statement of Operations. Losses other than temporary, which reduce the carrying amount below cost are recognized in Consolidated Statement of Operations. (i) 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 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. (j) Goodwill and Impairment 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. The Company tests goodwill annually for any impairments or whenever events occur which may indicate impairment. The first step is to compare the carrying amount of the reporting unit's assets to the fair value of the reporting unit. If the carrying amount exceeds the fair value then a second step is completed which involves the fair value of the reporting unit being allocated to each asset and liability with the excess being goodwill. The impairment loss is the amount by which the recorded goodwill exceeds the implied goodwill. No impairment was recognized as a result of the impairment testing carried out for the years ended December 31, 2017, December 31, 2016 and December 31, 2015. (k) Intangible assets Intangible assets are amortized on a straight line basis over their estimated useful life. (l) Cash and cash equivalents Cash and cash equivalents include cash and highly liquid investments with initial maturities of three months or less and are stated at cost, which approximates market value. (m) Short term investments - available for sale The Company classifies short-term investments as available for sale in accordance with the terms of FASB ASC 320, Investments – Debt and Equity Securities. Realized gains and losses are determined using specific identification. The investments are reported at fair value, with unrealized gains or losses reported in a separate component of shareholders' equity. Any differences between the cost and fair value of the investments are represented by accrued interest and unrealized gains/losses. (n) Accounts receivable, net Accounts receivable are recorded at fair value less an allowance for doubtful accounts. The allowance is an estimate based on historical collection experience, current economic and market conditions, and a review of the current status of each customer's trade accounts receivable. Account balances are written-off against the allowance when the Group determines that it is probable that the receivable will not be recovered. (o) Inventory Inventory is valued at the lower of cost and net realizable value and after provisions for obsolescence. The cost of inventories comprises the purchase price and attributable costs, less trade discounts. At December 31, 2017 the carrying value of inventory, included within prepayments and other current assets on the Consolidated Balance Sheet, was $2.2 million (2016: $2.4 million). (p) Property, plant and equipment Property, plant and equipment is stated at cost less accumulated depreciation. Depreciation of property, plant and equipment is computed using the straight line method based on the estimated useful lives of the assets as listed below:
Leasehold improvements are amortized using the straight-line method over the estimated useful life of the asset or the lease term, whichever is shorter. (q) Leased assets Costs in respect of operating leases are charged to the Consolidated Statement of Operations on a straight line basis over the lease term. Assets acquired under capital finance leases are included in the Consolidated Balance Sheet at the present value of the future minimum lease payments and are depreciated over the shorter of the lease term and their remaining useful lives. The corresponding liabilities are recorded in the Consolidated Balance Sheet and the interest element of the capital lease rental is charged to interest expense. (r) Income taxes The Company applies the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance to the amount more likely than not to be realized. The Company recognizes the effect of income tax positions only if those positions will more likely than not be sustained. Recognized income tax positions are measured at the largest amount of tax benefit that is greater than 50 percent likely of being realized upon settlement. Interest and penalties related to income taxes are included in income tax expense and classified with the related liability on the Consolidated Balance Sheet. The Company intends to account for the impact of GILTI (“global intangible low-taxed income”) as a period item in the period it arises and has therefore not provided for deferred taxes in respect of this item. (s) Government grants Government grants received relating to capital expenditures are shown as deferred income and credited to income on a basis consistent with the depreciation policy of the relevant assets. Grants relating to categories of operating expenditures are credited to income in the period in which the expenditure to which they relate is charged. Under the grant agreements amounts received may become repayable in full should certain circumstances specified within the grant agreements occur, including downsizing by the Company, disposing of the related assets, ceasing to carry on its business or the appointment of a receiver over any of its assets. The Company has not recognized any loss contingency having assessed as remote the likelihood of these events arising. (t) Research and development credits Research and development credits are available to the Company under the tax laws in certain jurisdictions, based on qualifying research and development spend as defined under those tax laws. Research and development credits are generally recognized as a reduction of income tax expense. However, certain tax jurisdictions provide refundable credits that are not wholly dependent on the Company's ongoing income tax status or income tax position. In these circumstances the benefit of these credits is not recorded as a reduction to income tax expense, but rather as a reduction of operating expenditure. (u) Pension costs The Company contributes to defined contribution plans covering all eligible employees. The Company contributes to these plans based upon various fixed percentages of employee compensation and such contributions are expensed as incurred. The Company operates, through two subsidiaries, a defined benefit plan for certain of its United Kingdom and Swiss employees. The Company accounts for the costs of these plans using actuarial models required by FASB ASC 715-30 and these plans are presented in accordance with the requirements of FASB ASC 715-60 Defined Benefit Plans – Other Post retirement. (v) Net income per ordinary share Basic net income per ordinary share 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. There is no difference in net income used for basic and diluted net income per ordinary share. The reconciliation of the number of shares used in the computation of basic and diluted net income per ordinary share is as follows:
(w) 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 FASB 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. Forfeitures are estimated on the date of grant and revised if actual or expected forfeiture activity differs materially from original estimates. 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. Liability classified awards are measured at the fair value of the award on the grant date and remeasured at each reporting period at fair value until the award is settled. (x) Impairment of long-lived assets Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the asset to future undiscounted net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured at the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of are reported at the lower of the carrying amount of the asset or fair value less selling costs. (y) Derivative financial instruments We enter into transactions in the normal course of business using various financial instruments in order to hedge against exposure to fluctuating exchange and interest rates. We use derivative financial instruments to reduce exposure to fluctuations in interest rates. A derivative is a financial instrument or other contract whose value changes in response to some underlying variable, which has an initial net investment smaller than would be required for other instruments that have a similar response to the variable and that will be settled at a future date. We do not enter into derivative financial instruments for trading or speculative purposes. We did not hold any interest rate swap contracts or forward currency contracts at December 31, 2016 or December 31, 2015. We use derivative financial instruments to reduce exposure to fluctuations in foreign exchange rates. During the year-ended December 31, 2017, we entered into forward currency contracts in respect of identified exposure arising from euro payments. The fair value of the derivative asset at December 31, 2017 was $1.2 million (included in other receivables). The forward currency contracts expire within 12 months of year-end. Our accounting policies for derivative financial instruments are based on whether they meet the criteria for designation as cash flow or fair value hedges. A designated hedge of the exposure to variability in the future cash flows of an asset or a liability, or of a forecasted transaction, is referred to as a cash flow hedge. A designated hedge of the exposure to changes in fair value of an asset or a liability is referred to as a fair value hedge. The criterion for designating a derivative as a hedge includes the assessment of the instrument's effectiveness in risk reduction, matching of the derivative instrument to its underlying transaction and the probability that the underlying transaction will occur. For derivatives with cash flow hedge accounting designation, we report the gain or loss from the effective portion of the hedge as a component of Other Comprehensive Income and reclassify it into earnings in the same period or periods in which the hedged transaction affects earnings and within the same income statement line item as the impact of the hedged transaction. For derivatives with fair value hedge accounting designation, we recognize gains or losses from the change in fair value of these derivatives, as well as the offsetting change in the fair value of the underlying hedged item, in earnings. Fair value gains and losses arising on derivative financial instruments not qualifying for hedge accounting are reported in our Consolidated Statement of Operations. (z) Financing costs and gain on interest rate hedge The interest rate in respect of the Senior Notes is fixed at 3.64% for the five year term of the agreement. The associated interest cost is recognized in interest expense in the period since drawdown in December 2015. On October 5, 2015, the Company entered into an interest rate hedge in respect of the planned issuance of the Senior Notes in December 2015. The interest rate hedge matured on November 17, 2015 when the interest rate on the Senior Notes was fixed. The interest rate hedge was effective in accordance with Financial Accounting Standards Board ("FASB") ASC 815, "Derivatives and Hedging". The cash proceeds ($4.6 million), representing the realized gain on the interest rate hedge, were received on maturity in November 2015 and are recorded within Other Comprehensive Income. The realized gain will be amortized to the Consolidated Statement of Operations, net against interest payable, over the period of the Senior Notes. Deferred financing costs (including issue costs relating to the Senior Notes) are reported at cost less accumulated amortization and the related amortization expense is included in interest expense, in our Consolidated Statement of Operations. (aa) Reclassifications Certain amounts in the consolidated financial statements have been reclassified where necessary to conform to the current year presentation. |
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Short term investments - available for sale | Short term investments - available for sale
The Company classifies its short term investments as available for sale. Short term investments comprise highly liquid investments with maturities of greater than three months and minimum "A-" rated fixed and floating rate securities. Short term investments at December 31, 2017 have an average maturity of 1.58 years compared to 1.37 years at December 31, 2016. The investments are reported at fair value with unrealized gains or losses reported in a separate component of shareholders' equity. Any differences between the cost and fair value of investments are represented by accrued interest and unrealized gains/losses. The fair value of short term investments are represented by level 1 fair value measurements – quoted prices in active markets for identical assets. The following table represents our available for sale short term investments by major security type as of December 31, 2017:
The contractual maturity of certain of the portfolio is greater than 12 months, however classification as short-term investments reflects the Company practice and intention in respect of these investments. The company recognizes the unrealized losses in fair value in equity as these unrealized losses on short term investments have been considered as temporary. |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill | Goodwill
The Company has made a number of strategic acquisitions since inception to enhance its capabilities and experience in certain areas of the clinical development process. Goodwill arising on acquisition represents the excess of the cost of acquired entities over the net amounts assigned to assets acquired and liabilities assumed. Goodwill primarily comprises of the acquired workforce in place which does not qualify for recognition as an asset apart from goodwill. The Company acquired Mapi Developments SAS ('Mapi') during the year-ended December 31, 2017 resulting in the recognition of goodwill of $129.2 million (note 4 (a)). The Company tests goodwill annually for impairment or whenever events occur which may indicate impairment. The results of the Company's goodwill impairment testing (assessed at September 30, 2017) during the year ended December 31, 2017 provided no evidence of impairment and indicated the existence of sufficient headroom such that a reasonably possible change to the key assumptions used would be unlikely to result in an impairment of the related goodwill. (a) Acquisitions - Mapi Group On July 27, 2017, a subsidiary of the Company, ICON Clinical Research Limited, acquired Mapi Group. Mapi Group is a leading patient-centered health outcomes research and commercialization company. Cash outflows on acquisition were $144.1 million. The acquisition of Mapi has been accounted for as a business combination in accordance with FASB ASC 805 Business Combinations. The Company has made a provisional assessment of the fair value of assets acquired and liabilities assumed as at that date. The table following summarizes the Company’s provisional estimates of the fair values of the assets acquired and liabilities assumed:
*Goodwill represents the acquisition of an established workforce with experience in late phase commercialization, analytics, real world evidence generation and strategic regulatory services in clinical trial services for biologics, drugs and devices. Goodwill related to the business acquired is not tax deductible. **The Company has made an initial estimate of separate intangible assets acquired of $32.3 million, being customer relationships and order book assets. This assessment is under review and will be finalized within 12 months of the date of acquisition. The proforma effect of the Mapi acquisition if completed on January 1, 2016 would have resulted in net revenue, net income and earnings per share for the fiscal years ending December 31, 2017 and December 31, 2016 as follows:
(b) Acquisition of ClinicalRM On September 15, 2016, a subsidiary of the Company, ICON US Holdings Inc. acquired Clinical Research Management, Inc. ("ClinicalRM") which resulted in net cash outflows of $52.4 million (including certain payments made on behalf of ClinicalRM totaling $9.2 million). ClinicalRM is a full-service CRO specializing in preclinical through Phase IV support of clinical research and clinical trial services for biologics, drugs and devices. The organization helps customers progress their products to market faster with a wide array of research, regulatory and sponsor services within the U.S. and around the globe. ClinicalRM provide full service and functional research solutions to a broad range of US government agencies. Their extensive expertise extends across basic and applied research, infectious diseases, vaccines development, testing and the response to bio-threats. They have worked in collaboration with government and commercial customers to respond to the threat of global viral epidemics. Further consideration of up to $12.0 million is payable if certain performance milestones are achieved in respect of periods up to December 31, 2017. The fair value of the contingent consideration on acquisition and at March 31, 2017, was estimated at $6.0 million. The evaluation of the performance and forecast performance of ClinicalRM against performance milestones was updated as required at June 30, 2017. Arising from that evaluation, the fair value of the contingent consideration liability was determined as $Nil, resulting in a net credit of $6.0 million being recorded within selling, general & administrative expenses in the Consolidated Statement of operations. The fair value of the contingent consideration at December 31, 2017 is $Nil. The acquisition of ClinicalRM has been accounted for as a business combination in accordance with FASB ASC 805 Business Combinations. The table following summarizes the fair values of the assets acquired and liabilities assumed:
*Goodwill represents the acquisition of an established workforce with experience in preclinical through Phase IV support of clinical research and clinical trial services for biologics, drugs and devices. Goodwill related to the US portion of the business acquired is tax deductible. In finalizing the goodwill on acquisition of CRM in the twelve month period from acquisition, fair value adjustments were made which resulted in an increase to unbilled revenue ($1.1 million) and other liabilities ($1.1 million) and in a decrease to accounts receivable ($0.3 million) and accounts payable ($0.5 million). Customer list, order backlog and brand intangible asset values were also finalized. The proforma effect of the ClinicalRM acquisition if completed on January 1, 2015 would have resulted in net revenue, net income and earnings per share for the fiscal years ended December 31, 2016 and December 31, 2015 as follows:
(c) Acquisition of PMG On December 4, 2015, a subsidiary of the Company, ICON Clinical Research LLC. acquired PMG for cash consideration of $65.4 million, including certain payments on behalf of PMG totaling $10.1 million. PMG is an integrated network of 52 clinical research sites in North Carolina, South Carolina, Tennessee, Illinois and Iowa. The site network includes wholly owned facilities and dedicated clinical research sites. PMG conducts clinical trials in all major therapeutic areas and has particular expertise in vaccine, gastroenterology, cardiovascular, neurology and endocrinology studies. It has a proprietary database of clinical trial participants. It also has access to in excess of 2 million active patients via electronic medical records through its partnerships with health care institutions and community physical practices. The acquisition of PMG has been accounted for as a business combination in accordance with FASB ASC 805 Business Combinations. The table following summarizes the fair values of the assets acquired and liabilities assumed;
*Goodwill represents the acquisition of an established workforce with experience in clinical trial consulting and regulatory support for the development of drugs, medical devices and diagnostics, with a specific focus on strategy to increase efficiency and productivity in product development. In finalizing the goodwill on acquisition of PMG in the twelve month period from acquisition, fair value adjustments of $7.7 million were made to deferred tax liabilities ($3.1 million), accounts receivable acquired ($1.4 million), other liabilities ($1.2 million) and the value of the customer list and order backlog assets acquired ($0.4 million). Additional consideration of $1.6 million was provided on completion of the contractual working capital process. The proforma effect of the PMG acquisition if completed on January 1, 2014 would have resulted in net revenue, net income and earnings per share for the fiscal years ended December 31, 2015 and December 31, 2014 as follows:
(d) Acquisition of MediMedia Pharma Solutions On February 27, 2015, a subsidiary of the Company, ICON Holdings Unlimited Company (formerly ICON Holdings), acquired MediMedia Pharma Solutions for cash consideration of $104.7 million (net of working capital adjustments of $4.0 million). In addition to the cash consideration, certain payments were made on behalf of MediMedia Pharma Solutions on completion totaling $11.3 million. Headquartered in Yardley, Pennsylvania, MediMedia Pharma Solutions includes MediMedia Managed Markets and Complete Healthcare Communications. MediMedia Managed Markets is a leading provider of strategic payer-validated market access solutions. Complete Healthcare Communications is one of the leading medical and scientific communication agencies working with medical affairs, commercial and brand development teams within life science companies. The acquisition agreement provides for certain working capital targets to be achieved by MediMedia Pharma Solutions. The acquisition of MediMedia Pharma Solutions has been accounted for as a business combination in accordance with FASB ASC 805 Business Combinations. The following table summarizes the fair values of the assets acquired and liabilities assumed on acquisition:
The proforma effect of the MediMedia Pharma Solutions acquisition if completed on January 1, 2014 would have resulted in net revenue, net income and earnings per share for the fiscal years ended December 31, 2015 and December 31, 2014 as follows:
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets | Intangible Assets
On July 27, 2017, a subsidiary of the Company, ICON Clinical Research Limited acquired Mapi Group. Mapi is a leading patient-centered health outcomes research and commercialization company. The acquisition of Mapi strengthens ICON’s existing commercialization and outcomes research business adding significant commercialization presence, analytics, real world evidence generation and strategic regulatory services. The value of intangible assets provisionally identified is $32.3 million. These intangible assets are being amortized over approximately 6 years, the estimated period of benefit. In total, $3.3 million has been amortized in the period since the date of acquisition. On September 15, 2016, a subsidiary of the Company, ICON US Holdings Inc., acquired ClinicalRM, a full-service CRO specializing in preclinical through Phase IV support of clinical research and clinical trial services for biologics, drugs and devices. The organization helps customers progress their products to market faster with a wide array of research, regulatory and sponsor services within the U.S. and around the globe. ClinicalRM provide full service and functional research solutions to a broad range of US government agencies. The value of certain customer relationship, order backlog and brand assets identified of $4.0 million, $1.7 million and $1.4 million respectively are being amortized over approximately 7 years, 2 years and 5 years respectively, the estimated period of benefit. In total, $2.3 million has been amortized in the period since the date of acquisition. On December 4, 2015, a subsidiary of the Company, ICON Clinical Research LLC, acquired PMG, an integrated network of 52 clinical research sites in North Carolina, South Carolina, Tennessee, Illinois and Iowa. The site network includes wholly owned facilities and dedicated clinical research sites. PMG conducts clinical trials in all major therapeutic areas and has particular expertise in vaccine, gastroenterology, cardiovascular, neurology and endocrinology studies. The value of certain customer relationship and order backlog assets identified of $6.9 million and $3.0 million respectively are being amortized over approximately 7 years and 2 years respectively, the estimated period of benefit. In total, $5.0 million has been amortized in the period since the date of acquisition. The order backlog is fully amortized at December 31, 2017. On February 27, 2015, a subsidiary of the Company, ICON Holdings Unlimited Company (formerly ICON Holdings), acquired MediMedia Pharma Solutions. Headquartered in Yardley, Pennsylvania, MediMedia Pharma Solutions includes MediMedia Managed Markets and Complete Healthcare Communications. MediMedia Managed Markets is a leading provider of strategic payer-validated market access solutions. Complete Healthcare Communications is one of the leading medical and scientific communication agencies working with medical affairs, commercial and brand development teams within life science companies. The value of certain customer relationships and order backlog identified of $22.8 million and $2.5 million respectively are being amortized over approximately 7 years and 1 year, the estimated period of benefit. $11.7 million has been amortized in the period since the date of acquisition. The order backlog is fully amortized at December 31, 2017. On May 7, 2014, a subsidiary of the Company, ICON US Holdings Inc., acquired Aptiv Solutions, Inc. ("Aptiv"), a global biopharmaceutical and medical device development services company and leader in adaptive clinical trials. Aptiv offers full-service clinical trial consulting and regulatory support for drugs, medical devices and diagnostics with a specific focus on strategy to increase product development efficiency and productivity. The value of certain customer relationships and order backlog identified of $21.4 million and $7.9 million respectively are being amortized over approximately 7 years and 3 years, the estimated period of benefit. In total, $19.1 million has been amortized in the period since the date of acquisition. The order backlog is fully amortized at December 31, 2017. On February 15, 2013, subsidiaries of the Company, ICON Clinical Research LLC (formerly ICON Clinical Research, Inc.) and ICON Clinical Research (U.K.) Limited, acquired the Clinical Trial Services division of Cross Country Healthcare, Inc. Cross Country Healthcare's Clinical Trial Services division includes US resourcing providers, ClinForce and Assent Consulting, whose services include contract staffing, permanent placement and functional service provision ("FSP"). The value of certain customer relationships and order backlog identified of $3.3 million and $0.6 million respectively are being amortized over approximately 3 years and 1 year, the estimated period of benefit. The full $3.9 million has been amortized in the period since the date of acquisition. On February 28, 2012, a subsidiary of the Company, ICON Clinical Research LLC (formerly ICON Clinical Research, Inc.), acquired PriceSpective, a strategy consulting company. The value of certain customer relationships identified of $10.2 million is being amortized over approximately 10 years, the estimated period of benefit. The value of order backlog and certain non-compete arrangements identified of $0.4 million and $0.4 million respectively are being amortized over approximately 0.8 years and 3 years, the estimated period of benefit. In total, $6.8 million has been amortized in the period since the date of acquisition. On February 15, 2012, a subsidiary of the Company, ICON Clinical Research Limited, acquired BeijingWits Medical, a Chinese CRO. The value of certain customer relationships and order backlog identified of $1.8 million and $0.4 million respectively are being amortized over approximately 10 years and 4 years, the estimated period of benefit. The value of certain non-compete arrangements identified of $0.01 million are being amortized over approximately 5 years, the estimated period of benefit. In total, $1.5 million has been amortized in the period since the date of acquisition. On July 14, 2011, a subsidiary of the Company, ICON Clinical Research Limited, acquired Firecrest Clinical Limited, a provider of technology solutions that boost investigator site performance and study management. The value of certain technology assets and customer relationships identified of $11.2 million and $5.2 million respectively are being amortized over approximately 7.5 years, the estimated period of benefit. The value of the Firecrest trade name and order backlog identified of $1.4 million and $1.2 million respectively are being amortized over approximately 4.5 years and 1.2 years, the estimated period of benefit. In total, $14.5 million has been amortized in the period since the date of acquisition. On January 14, 2011, a subsidiary of the Company, ICON Clinical Research (U.K.) Limited, acquired Oxford Outcomes Limited, an international health outcomes consultancy business. The value of certain customer relationships and order backlog identified of $6.6 million and $0.6 million respectively were amortized over approximately 6.5 years and 2 years, the estimated period of benefit. The intangible assets identified have been fully amortized at December 31, 2017. On November 14, 2008, subsidiaries of the Company, ICON Holdings Clinical Research International Limited and ICON Clinical Research LLC (formerly ICON Clinical Research, Inc.), acquired Prevalere Life Sciences, a US provider of bioanalytical and immunoassay laboratory services. The value of certain customer relationships identified of $7.4 million is being amortized over periods ranging from approximately 7 to 11 years, the estimated period of the benefit. In total, $6.8 million has been amortized in the period since the date of acquisition. On February 11, 2008, a subsidiary of the Company, ICON Clinical Research LLC (formerly ICON Clinical Research, Inc.), acquired Healthcare Discoveries, a US provider of Phase I clinical trial services. The value of certain client relationships identified of $1.6 million was amortized over periods ranging from approximately 2 to 9 years, the estimated periods of benefit. The value of certain volunteer lists identified of $1.3 million was amortized over approximately 6 years, the estimated period of benefit. The intangible assets identified have been fully amortized at December 31, 2017. Future intangible asset amortization expense for the years ended December 31, 2018 to December 31, 2022 is as follows:
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Property, Plant and Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment, net | Property, Plant and Equipment, net
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Other Liabilities | Other Liabilities
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Non-Current Other Liabilities | Non-Current Other Liabilities
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Benefits | Employee Benefits Certain Company employees are eligible to participate in a defined contribution plan (the "Plan"). Participants in the Plan may elect to defer a portion of their pre-tax earnings into a pension plan, which is run by an independent party. The Company matches participant's contributions typically at 6% of the participant's annual compensation. Contributions to the plan are recorded as an expense in the selling, general and administrative line in the Consolidated Statement of Operations. Contributions for the years ended December 31, 2017, December 31, 2016 and December 31, 2015 were $20,355,000, $20,952,000 and $20,439,000 respectively. The Company's United States operations maintain a retirement plan (the "U.S. Plan") that qualifies as a deferred salary arrangement under Section 401(k) of the Internal Revenue Code. Participants in the U.S. Plan may elect to defer a portion of their pre-tax earnings, up to the Internal Revenue Service annual contribution limit. The Company matches 50% of each participant's contributions; each participant can contribute up to 6% of their annual compensation. Contributions to this U.S. Plan are recorded, in the year contributed, as an expense in the Consolidated Statement of Operations. Contributions for the years ended December 31, 2017, December 31, 2016 and December 31, 2015 were $14,946,000, $15,223,000 and $12,802,000 respectively. One of the Company's subsidiaries, ICON Development Solutions Limited, operates a defined benefit pension plan in the United Kingdom for its employees. The plan is managed externally and the related pension costs and liabilities are assessed in accordance with the advice of a professionally qualified actuary. Plan assets at December 31, 2017, December 31, 2016 and December 31, 2015, consist of units held in independently administered funds. The pension costs of this plan are presented in the following tables in accordance with the requirements of ASC 715-60, Defined Benefit Plans – Other Postretirement. The plan has been closed to new entrants with effect from July 1, 2003.
The fair values of the assets above do not include any of the Company's own financial instruments, property occupied by, or other assets used by, the Company. The following amounts were recorded in the Consolidated Statement of Operations as components of the net periodic benefit cost:
The following assumptions were used at the commencement of the year in determining the net periodic pension benefit cost for the years ended December 31, 2017, December 31, 2016 and December 31, 2015:
The estimated net loss and prior service cost for the defined benefit pension plan that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next year are $0.3 million and $Nil respectively. Amounts recognized in accumulated other comprehensive income that have not yet been recognized as components of net periodic benefit cost are as follows:
Benefit Obligation The following assumptions were used in determining the benefit obligation at December 31, 2017 and December 31, 2016:
The discount rate is determined by reference to UK long dated government and corporate bond yields at the Balance Sheet date. This is represented by the iboxx corporate bond over 15 year index plus 10 basis points. Plan Assets The assets of the scheme are invested with Legal and General and held in a combination of the Active Corporate Bond over 10 Year fund, Gilt and Index Linked Gilt funds. The overall investment strategy is that approximately 75% of investments are in government bonds (both fixed interest and index linked), approximately 25% of investments are held in corporate bonds. There is no self-investment in employer related assets. The expected long-term rate of return on assets at December 31, 2017 of 2.0% was calculated as the value of the fund after application of a market value reduction factor. The expected long term rates of return on different asset classes are as follows:
The long-term expected return on corporate bonds and gilts (fixed interest and index linked) is determined by reference to bond yields and gilt yields at the Balance Sheet date. The underlying asset split of the fund is shown below.
Applying the above expected long term rates of return to the asset distribution at December 31, 2017, gives rise to an expected overall rate of return of scheme assets of approximately 2.0% per annum. Plan Asset Fair Value Measurements
Cash Flows The Company expects to contribute $0.1 million to the pension fund in the year ending December 31, 2018. The following annual benefit payments, which reflect expected future service as appropriate, are expected to be paid.
The expected cash flows are estimated figures based on the members expected to retire over the next 10 years assuming no early retirements plus an additional amount based on recent average withdrawal experience. At the present time it is not clear whether annuities will be purchased when members reach retirement or whether pensions will be paid each month out of scheme assets. The cash flows above have been estimated on the assumption that pensions will be paid monthly out of scheme assets. If annuities are purchased, then the expected benefit payments will be significantly different from those shown above. On May 7, 2014 the Company acquired 100% of the common stock of Aptiv Solutions ("Aptiv"). The acquisition of Aptiv was accounted for as a business combination in accordance with FASB ASC 805 Business Combinations. The Company has a defined benefit plan covering its employees in Switzerland as mandated by the Swiss government. Benefits are based on the employee's years of service and compensation. Benefits are paid directly by the Company when they become due, in conformity with the funding requirements of applicable government regulations. The plan is managed externally and the related pension costs and liabilities are assessed in accordance with the advice of a professionally qualified actuary. Plan assets at December 31, 2017 and December 31, 2016 consist of units held in independently administered funds. The pension costs of this plan are presented in the following tables in accordance with the requirements of ASC 715-60, Defined Benefit Plans – Other Postretirement.
The fair values of the assets above do not include any of the Company's own financial instruments, property occupied by, or other assets used by, the Company.
The following assumptions were used at the commencement of the year in determining the net periodic pension benefit cost for the years ended December 31, 2017, December 31, 2016 and December 31, 2015:
The estimated net gain and prior service credit for the defined benefit pension plan that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next year are $69,000 and $8,000 respectively. Amounts recognized in accumulated other comprehensive income that have not yet been recognized as components of net periodic benefit cost are as follows:
Benefit Obligation The following assumptions were used in determining the benefit obligation at December 31, 2017 and December 31, 2016:
The discount rate is determined by reference to Swiss corporate bond yields at the Balance Sheet date. Plan Assets The pension plan is an insured arrangement with Swiss Life. The assets are an insurance contract whose value depends on the amount saved by employees and the interest granted by Swiss Life. The value of assets does not depend on the performance of any underlying assets. There is no self-investment in employer related assets. Cash Flows The Company expects to contribute $0.1 million to its pension fund in the year ending December 31, 2018. The following annual benefit payments, which reflect expected future service as appropriate, are expected to be paid.
The expected cash flows are estimated figures based on the members expected to retire over the next 10 years assuming no early retirements plus an additional amount based on recent average withdrawal experience. At the present time it is not clear whether annuities will be purchased when members reach retirement or whether pensions will be paid each month out of scheme assets. The cash flows above have been estimated on the assumption that pensions will be paid monthly out of scheme assets. If annuities are purchased, then the expected benefit payments will be significantly different from those shown above. |
Equity Incentive Schemes and Stock Compensation Charges |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity Incentive Schemes and Stock Compensation Charges | Equity Incentive Schemes and Stock Compensation Charges Share Options On July 21, 2008 the Company adopted the Employee Share Option Plan 2008 (the "2008 Employee Plan") pursuant to which the Compensation and Organization Committee of the Company's Board of Directors may grant options to any employee, or any Director holding a salaried office or employment with the Company or a Subsidiary for the purchase of ordinary shares. On the same date, the Company also adopted the Consultants Share Option Plan 2008 (the "2008 Consultants Plan"), pursuant to which the Compensation and Organization Committee of the Company's Board of Directors may grant options to any consultant, adviser or non-executive Director retained by the Company or any Subsidiary for the purchase of ordinary shares. On February 14, 2017 both the 2008 Employee Plan and the 2008 Consultants Plan (together the "2008 Option Plans") were amended and restated in order to increase the number of options that can be issued under the 2008 Consultants Plan from 400,000 to 1 million and to extend the date for options to be granted under the 2008 Option Plans. An aggregate of 6.0 million ordinary shares have been reserved under the 2008 Employee Plan, as reduced by any shares issued or to be issued pursuant to options granted under the 2008 Consultants Plan, under which a limit of 1 million shares applies. Further, the maximum number of ordinary shares with respect to which options may be granted under the 2008 Employee Option Plan, during any calendar year to any employee shall be 400,000 ordinary shares. There is no individual limit under the 2008 Consultants Plan. No options may be granted under the 2008 Option Plans after February 14, 2027. Each option granted under the 2008 Option Plans will be an employee stock option, or NSO, as described in Section 422 or 423 of the Internal Revenue Code. Each grant of an option under the 2008 Options Plans will be evidenced by a Stock Option Agreement between the optionee and the Company. The exercise price will be specified in each Stock Option Agreement, however option prices will not be less than 100% of the fair market value of an ordinary share on the date the option is granted. On January 17, 2003 the Company adopted the Share Option Plan 2003 (the "2003 Share Option Plan") pursuant to which the Compensation and Organization Committee of the Board could grant options to officers and other employees of the Company or its subsidiaries for the purchase of ordinary shares. An aggregate of 6.0 million ordinary shares were reserved under the 2003 Share Option Plan; and in no event could the number of ordinary shares issued pursuant to options awarded under this plan exceed 10% of the outstanding shares, as defined in the 2003 Share Option Plan, at the time of the grant, unless the Board expressly determined otherwise. Further, the maximum number of ordinary shares with respect to which options could be granted under the 2003 Share Option Plan during any calendar year to any employee was 400,000 ordinary shares. The 2003 Share Option Plan expired on January 17, 2013. No new options may be granted under this plan. Share option awards are granted with an exercise price equal to the market price of the Company's shares at date of grant. Share options typically vest over a period of five years from date of grant and expire eight years from date of grant. The maximum contractual term of options outstanding at December 31, 2017 is eight years. The following table summarizes the transactions for the Company's share option plans for the years ended December 31, 2017, December 31, 2016 and December 31, 2015:
The weighted average remaining contractual life of options outstanding and options exercisable at December 31, 2017, was 4.86 years and 3.4 years respectively (2016: 4.67 years and 3.30 years respectively). 255,198 options are expected to vest during the year ended December 31, 2018 (333,433 options were expected to vest during the year ended December 31, 2017). The intrinsic value of options exercised during the year ended December 31, 2017 amounted to $31.8 million. The intrinsic value of options outstanding and options exercisable at December 31, 2017 amounted to $65.8 million and $35.1 million respectively. Intrinsic value is calculated based on the market value versus strike price of the Company's shares at the date of exercise. Non-vested shares outstanding as at December 31, 2017 are as follows:
Outstanding and exercisable share options: The following table summarizes information concerning outstanding and exercisable share options as of December 31, 2017:
Options outstanding include both vested and unvested options as at December 31, 2017. Options exercisable represent options which have vested at December 31, 2017. From the date of grant, substantially all options vest over a five year period at 20% per annum. Fair value of Stock Options Assumptions The weighted average fair value of options granted during the years ended December 31, 2017, December 31, 2016 and December 31, 2015 was calculated using the Black-Scholes option pricing model. The weighted average fair values and assumptions were as follows:
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 July 21, 2008 the Company adopted the 2008 Employees Restricted Share Unit Plan (the "2008 RSU Plan") pursuant to which the Compensation and Organization Committee of the Company's Board of Directors may select any employee, or any Director holding a salaried office or employment with the Company, or a Subsidiary to receive an award under the plan. An aggregate of 1.0 million ordinary shares have been reserved for issuance under the 2008 RSU Plan. On April 23, 2013 the Company adopted the 2013 Employees Restricted Share Unit and Performance Share Unit Plan (the "2013 RSU Plan") pursuant to which the Compensation and Organization Committee of the Company's Board of Directors may select any employee, or any Director holding a salaried office or employment with the Company, or a Subsidiary to receive an award under the plan. On May 11, 2015 the 2013 RSU Plan was amended and restated in order to increase the number of shares that can be issued under the RSU Plan by 2.5 million shares. Accordingly, an aggregate of 4.1 million ordinary shares have been reserved for issuance under the 2013 RSU Plan. The shares are awarded at par value and vest over a service period. Awards under the 2013 RSU Plan may be settled in cash or shares at the option of the Company. The Company has awarded RSUs and PSUs to certain key individuals of the Group. The following table summarizes RSU and PSU activity for the year ended December 31, 2017:
The fair value of RSUs vested for the year ended December 31, 2017 totaled $16.6 million (2016: $10.8 million). The fair value of PSUs vested for the year ended December 31, 2017 totaled $15.0 million (2016: $10.3 million). The PSUs vest based on service and specified EPS targets over the period 2014 – 2017, 2015 – 2018, 2016 - 2019 and 2017 - 2020. Since 2013, 270,858 PSUs (net of forfeitures) have been granted. Depending on the actual amount of EPS from 2014 to 2020, up to an additional 240,168 PSUs may also be granted. Non-cash stock compensation expense Income from operations for the year ended December 31, 2017 is stated after charging $30.6 million in respect of non-cash stock compensation expense. Non-cash stock compensation expense has been allocated as follows:
Total non-cash stock compensation expense not yet recognized at December 31, 2017 amounted to $49.3 million. The weighted average period over which this is expected to be recognized is 2.04 years. The amendments required by Accounting Standards Update (‘ASU’) 2016-09 ‘Improvements to Employee Share-Based Payment Accounting’ require the Company to record all tax effects related to share-based payments through the income statement rather than additional paid in capital. The Company has applied the updated standard prospectively in the twelve months of the year ended December 31, 2017. Total tax benefit recognized in additional paid in capital related to the non-cash compensation expense amounted to $Nil for the year ended December 31, 2017 (2016: $4.3 million, 2015: $1.9 million). The income tax expense for the year ended December 31, 2017 reflects a net income tax benefit of $9.3 million in connection with stock compensation (including excess benefits) and the total tax benefit realized in connection with stock options exercised during 2017 was $3.2 million. The income tax expense for the year ended December 31, 2016 reflects a net income tax benefit of $3.5 million in connection with stock compensation and the cash tax benefit realized in connection with stock options exercised during 2016 was $3.4 million. The income tax expense for the year ended December 31, 2015 reflects a net income tax benefit of $1.5 million in connection with stock compensation and the cash tax benefit realized in connection with stock options exercised during 2016 was $5.6 million. |
Government Grants |
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Deferred Revenue Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Government Grants | Government Grants
Capital grants received may be refundable in full if certain events occur. Such events, as set out in the related grant agreements, include sale of the related asset, liquidation of the Company or failure to comply with other conditions of the grant agreements. No loss contingency has been recognized as the likelihood of such events arising has been assessed as remote. Government grants amortized to the profit and loss account amounted to $44,000 for the year ended December 31, 2017. A net charge of $44,000 was recorded in respect of government grants during the year ended December 31, 2016. As at December 31, 2017 the Company had $1.2 million in restricted retained earnings, pursuant to the terms of grant agreements. |
Income Taxes |
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Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes The Company's United States and Irish based subsidiaries file tax returns in the United States and Ireland respectively. Other foreign subsidiaries are taxed separately under the laws of their respective countries. The components of income before provision for income taxes are as follows:
The components of provision for income taxes are as follows:
Ireland's statutory income tax rate is 12.5%. The Company's consolidated reported provision for income taxes differed from the amount that would result from applying the Irish statutory rate as set forth below:
In 2017, the provision for income taxes includes non-recurring items related to US Tax Reform (H.R.1). The income tax expense recognized in respect of mandatory deemed repatriation of historic earnings of non-U.S. subsidiaries owned by our U.S. subsidiaries is $7.7 million. The income tax expense recognized in respect of the change in the US federal income tax rate from 35% to 21% is $0.5 million (included in “Effects of change in tax rates” above). The income tax effects of US Tax Reform are provisional in respect of the Mapi Group acquisition in July 2017 (see Note 4 Goodwill for further information). The Company has made provisional estimates of the fair value of net assets acquired and liabilities assumed. The non-current deferred tax liability recognized as at December 31, 2017 in respect of US-based intangible assets is $5.8 million. To the extent there are purchase accounting adjustments made in a subsequent period, there may be additional income tax effects of US Tax Reform (i.e. impact of the change in rates) to be recognized at such time. The tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities are presented below:
At December 31, 2017 Ireland subsidiaries had tax credit carryforwards for income tax purposes that may be carried forward indefinitely, available for offset against future tax liabilities, if any, of $4.5 million (2016: $3.3 million). At December 31, 2017 U.S. subsidiaries had U.S. federal and state net operating loss ("NOL") carry forwards of approximately $25.0 million and $43.6 million, respectively. These NOLs are available for offset against future taxable income and expire between 2018 and 2037. Of the $25.0 million U.S. federal NOLs, approximately $5.9 million of which is available for offset against future U.S. federal taxable income within 12 months of the balance sheet date. The subsidiary's ability to use the U.S. federal and state NOL carry forwards is limited on an annual basis due to changes of ownership in 2000, 2010, 2014 and 2017, as defined by Section 382 of the Internal Revenue Code of 1986, as amended. Of the U.S. federal NOLs, $22.8 million are limited by Section 382. Of the $22.8 million of losses, the amounts are available as follows: $11.8 million for the years 2018 – 2020, $10.1 million in 2021-2025, $0.9 million for the years 2026 – 2035. At December 31, 2017 other than those in the U.S. and Ireland had operating loss carryforwards for income tax purposes that be carried forward indefinitely, available to offset against future taxable income, if any, of approximately $77.2 million (2016: $70.1 million). In addition at December 31, 2017 those subsidiaries had tax credit carryforwards for income tax purposes that may be carried forward indefinitely, available to offset against future tax liabilities, if any, of $4.8 million (2016: $3.9 million). At December 31, 2017 those subsidiaries also had additional operating loss carry forwards of $4.7 million which are due to expire between 2018 and 2024. The expected expiry dates of these losses are as follows:
In addition, US subsidiaries have alternative minimum tax credit carry forwards of approximately $0.4 million that are available to reduce future U.S. federal regular income taxes through 2020. Any remaining alternative minimum tax credits will be fully refundable in 2021. We also have general business credit carry forwards of approximately $0.3 million that are available to offset future U.S. federal income taxes. The valuation allowance at December 31, 2017 was approximately $22.4 million. The valuation allowance for deferred tax assets as of December 31, 2016 and December 31, 2015 was $20.3 million and $17.2 million respectively. The net change in the total valuation allowance was an increase of $2.1 million during 2017 and an increase of $3.1 million during 2016. Of the total increase of $2.1 million in 2017, $0.5 million resulted in a current year income tax expense and $1.6 million was recognized in Other Comprehensive Income. Of the total increase of $3.1 million in 2016, $1.2 million resulted in a current year income tax expense, $2.4 million was acquired and impacted goodwill, and these were offset by a decrease of $0.5 million recognized in Other Comprehensive Income. The valuation allowances at December 31, 2017 and December 31, 2016 were primarily related to operating losses and tax credits carried forward that, in the judgment of management, are not more likely than not to be realized. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities and projected future taxable income in making this assessment. In respect of deferred tax assets not subject to a valuation allowance, management considers that it is more likely than not that these deferred tax assets will be realized on the basis that there will be sufficient reversals of deferred tax liabilities and taxable income in future periods. During 2016, there were no movements in the valuation allowance that had a material impact on the effective tax rate. During 2017, there were no movements in the valuation allowance that had a material impact on the effective tax rate. The Company has recognized a deferred tax liability of $3.1 million (2016: $Nil) for the undistributed earnings of foreign subsidiaries where the Company does not consider the earnings to be indefinitely reinvested. It is not practicable to calculate the exact unrecognized deferred tax liability, however it is not expected to be material as Ireland allows a tax credit in respect of distributions from foreign subsidiaries at the statutory tax rate in the jurisdiction of the subsidiary so that no material tax liability would be expected to arise in the event these earnings were ever remitted. In addition, withholding taxes applicable to remittances from foreign subsidiaries would not be expected to be material given Ireland’s tax treaty network and the EU parent subsidiary directive. A reconciliation of the beginning and ending amount of total unrecognized tax benefits is as follows:
The relevant statute of limitations for unrecognized tax benefits totaling $3.4 million could potentially expire during 2018. Included in the balance of total unrecognized tax benefits at December 31, 2017 were potential benefits of $23.7 million, which if recognized, would affect the effective rate on income tax from continuing operations. The balance of total unrecognized tax benefits at December 31, 2016 and December 31, 2015 included potential benefits which, if recognized, would affect the effective rate of income tax from continuing operations of $26.6 million and $28.2 million respectively. Interest and penalties recognized as a net benefit during the year ended December 31, 2017 amounted to $0.9 million (2016: net expense of $0.1 million, 2015: net expense of $0.9 million) and are included within the provision for income taxes. Total accrued interest and penalties as of December 31, 2017 and December 31, 2016 were $2.4 million and $3.3 million respectively and are included in closing income taxes payable at those dates. Our major tax jurisdictions are the United States and Ireland. We may potentially be subjected to tax audits in both our major jurisdictions. In the United States tax periods open to audit include the years ended December 31, 2014, December 31, 2015, December 31, 2016 and December 31, 2017. In Ireland, tax periods open to audit include the years ended December 31, 2013, December 31, 2014, December 31, 2015, December 31, 2016 and December 31, 2017. During such audits, local tax authorities may challenge the positions taken by us in our tax returns. |
Share Capital |
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Equity [Abstract] | |||||
Share Capital | Share Capital Holders of ordinary shares will be entitled to receive such dividends as may be recommended by the Board of Directors of the Company and approved by the shareholders and/or such interim dividends as the Board of Directors of the Company may decide. On liquidation or a winding up of the Company, the par value of the ordinary shares will be repaid out of the assets available for distribution among the holders of the ordinary shares of the Company. Holders of ordinary shares have no conversion or redemption rights. On a show of hands, every holder of an ordinary share present in person or proxy at a general meeting of shareholders shall have one vote, for each ordinary share held with no individual having more than one vote. During the year ended December 31, 2017, 458,243 options were exercised by employees at an average exercise price of $30.35 per share for total proceeds of $13.9 million. During the year ended December 31, 2017, 361,102 ordinary shares were issued in respect of certain RSUs and 320,640 ordinary shares were issued in respect of PSUs previously awarded by the Company. During the year ended December 31, 2016, 393,240 options were exercised by employees at an average exercise price of $25.79 per share for total proceeds of $10.1 million. During the year ended December 31, 2016, 296,386 ordinary shares were issued in respect of certain RSUs and 311,492 ordinary shares were issued in respect of PSUs previously awarded by the Company. During the year ended December 31, 2015, 773,753 options were exercised by employees at an average exercise price of $27.13 per share for total proceeds of $21.0 million. During the year ended December 31, 2015, 268,870 ordinary shares were issued in respect of certain RSUs and 7,990 ordinary shares were issued in respect of PSUs previously awarded by the Company.
On October 3, 2016 the Company commenced a previously announced share buyback program of up to $400 million. During the year ended December 31, 2017, the Company redeemed a total of 1,589,227 ordinary shares under this program for total consideration of $133.1 million. At December 31, 2017 a total of 3,018,414 ordinary shares were redeemed by the Company under this buyback program for a total consideration of $243.1 million. 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 a other undenominated capital fund as required under Irish Company Law. On May 1, 2015 the Company commenced a buyback program of up to $60 million under which the Company could acquire 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. A total of 882,419 ordinary shares were redeemed by the Company under this buyback program for a total consideration of $57.9 million. 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 a other undenominated capital fund as required under Irish Company Law. On July 31, 2015 the Company commenced a further buyback program of up to $400 million under which the Company could acquire 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. A total of 5,316,062 ordinary shares were redeemed by the Company under this buyback program for a total consideration of $400 million. 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 a other undenominated capital reserve as required under Irish Company Law. The share buyback program was completed in December 31, 2015, with a total of 6,198,481 ordinary shares redeemed during the year ended December 31, 2015 for total consideration of $457.9 million. Under the repurchase program, a broker purchased the Company's shares from time to time on the open market or in privately negotiated transactions in accordance with agreed terms and limitations. The program was designed to allow share repurchases during periods when the Company would ordinarily not be permitted to do so because it may be in possession of material non-public or price-sensitive information or due to applicable insider trading laws or self-imposed trading blackout periods. The Company's instructions to the broker were irrevocable and the trading decisions in respect of the repurchase program were made independently of and uninfluenced by the Company. The Company confirms that on entering the share repurchase plans it had no material non-public, price-sensitive or inside information regarding the Company or its securities. Furthermore, the Company will not enter into additional plans whilst in possession of such information. The timing and actual number of shares acquired by way of the redemption will be dependent on market conditions, legal and regulatory requirements and the other terms and limitations contained in the program. In addition, acquisitions under the program may be suspended or discontinued in certain circumstances in accordance with the agreed terms. Therefore, there can be no assurance as to the timing or number of shares that may be acquired under the program. |
Restructuring and other items |
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Restructuring and Related Activities [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and other items | Restructuring and other items Restructuring and other items recognized during the year ended December 31, 2017 comprise:
Restructuring Charges A restructuring charge of $7.8 million was recognized during the year ended December 31, 2017, under a restructuring plan adopted following a review of operations. The restructuring plan reflected resource rationalization across the business to improve resource utilization.
Prior Period Restructuring Charges A restructuring charge of $8.2 million was recognized during the year ended December 31, 2016, under a restructuring plan adopted following a review by the Company of its operations. The restructuring plan includes resource rationalizations in certain areas of the business to improve resource utilization, resulting in charge of $6.2 million and office consolidation resulting in the recognition of an onerous lease of $2.0 million during the twelve months ended December 31, 2016. No additional charge was recorded during the twelve months ended December 31, 2017.
A restructuring charge of $8.8 million was recognized during the year ended December 31, 2014. Following the closure of the Company’s European Phase 1 services in 2013, the Company recognized a charge in 2014 in relation to its Manchester, United Kingdom facility; $5.6 million in relation to asset impairments and $3.2 million in relation to an onerous lease charge associated with this facility. We expect this to be paid by 2024.
At December 31, 2017, $3.2 million is included within other liabilities and $0.4 million within non-current other liabilities. |
Provision for Doubtful Debts |
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Accounts Receivable, Net [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision for Doubtful Debts | Provision for Doubtful Debts The Company does business with most major international pharmaceutical companies. Provision for doubtful debts at December 31, 2017 comprises:
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Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies | Commitments and Contingencies Litigation The Company is not party to any litigation or other legal proceedings that the Company believes could reasonably be expected to have a material adverse effect on the Company's business, results of operations and financial condition. Operating Leases The Company has several non-cancelable operating leases, primarily for facilities, that expire over the next 10 years. These leases generally contain renewal options and require the Company to pay all executory costs such as maintenance and insurance. The Company recognized $44.0 million, $44.0 million and $49.9 million in rental expense, including rates, for the years ended December 31, 2017, December 31, 2016 and December 31, 2015 respectively. Future minimum rental commitments for operating leases with non-cancelable terms in excess of one year are as follows:
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Business Segment and Geographical Information |
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Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Segment and Geographical Information | Business Segment and Geographical Information 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 predominately through internal growth, together with a number of strategic acquisitions to enhance its expertise and capabilities in certain areas of the clinical development process. The Company determines and presents operating segments based on the information that is internally provided to the chief operating decision maker, together the ('CODM') in accordance with FASB ASC 280-10 Disclosure about Segments of an Enterprise and Related Information. The Chief Executive Officer, Chief Financial Officer and Chief Operating Officer, were together considered the Company's CODM in the period up to and including March 1, 2017. On March 1, 2017, Mr Ciaran Murray transitioned from his role as Chief Executive Officer to the role of Executive Chairman of the Board of Directors and Dr. Steve Cutler was appointed as Chief Executive Officer. As of March 1, 2017, the Company determined that the CODM was comprised of the Chief Executive Officer and the Chief Financial Officer in accordance with the requirements of FASB ASC 280-10 Disclosures about Segments of an Enterprises and Related Information. The Company operates as one business segment, which is the provision of outsourced development services on a global basis to the pharmaceutical, biotechnology and medical devices industries. Revenues are allocated to individual entities based on where the work is performed in accordance with the Company's global transfer pricing model. Revenues and income from operations in Ireland are a function of this transfer pricing model. Given ICON Clinical Research Limited's ("ICON Ireland") role in the development and management of the group, it's ownership of key intellectual property, customer relationships, its key role in the mitigation of risks faced by the group, plus the responsibility for maintaining the group's global network, ICON Ireland acts as the group entrepreneur and enters into the majority of the Company's customer contracts. As such, ICON Ireland remunerates most of the other operating entities ("cost plus service providers") 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 in the various geographical areas 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. Under this method, the residual operating profits (or losses) of the group, once the cost plus service providers have been paid their respective intercompany service fee, are retained by ICON Ireland. The geographic split of revenue disclosed for each region outside Ireland is the cost plus revenue attributable to these entities. The revenues disclosed as relating to Ireland are the net revenues 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, Belgium, France, Germany, Italy, Spain, The Netherlands, Sweden, Turkey, Poland, Czech Republic, Latvia, Russia, Ukraine, Hungary, Israel, Romania, Switzerland, Canada, Mexico, Brazil, Colombia, Argentina, Chile, Peru, India, China, South Korea, Japan, Thailand, Taiwan, Singapore, The Philippines, Australia, New Zealand, and South Africa. There have been no changes to the basis of segmentation or the measurement basis for the segment results since the prior year. Reportable segment information at December 31, 2017 and December 31, 2016 and for the years ended December 31, 2017, December 31, 2016 and December 31, 2015 is as follows: a) The distribution of net revenue by geographical area was as follows:
b) The distribution of income from operations, including restructuring and other items, by geographical area was as follows:
c) The distribution of income from operations, excluding restructuring and other items, by geographical area was as follows:
d) The distribution of property, plant and equipment, net, by geographical area was as follows:
e) The distribution of depreciation and amortization by geographical area was as follows:
f) The distribution of total assets by geographical area was as follows:
g) The distribution of capital expenditures by geographical area was as follows:
h) The following table sets forth the clients which represented 10% or more of the Company's net revenue in each of the periods set out below.
i) The distribution of interest income by geographical area was as follows:
j) The distribution of the income tax charge by geographical area was as follows:
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Supplemental Disclosure of Cash Flow Information |
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Elements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Disclosure of Cash Flow Information | Supplemental Disclosure of Cash Flow Information
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Accumulated Other Comprehensive Income |
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Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income | Accumulated Other Comprehensive Income
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Long-Term Debt - Senior Notes |
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Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Long-Term Debt - Senior Notes | Long-Term Debt – Senior Notes In December 2015 the Company issued $350 million in the private placement market which is due for repayment in 2020. The interest rate in respect of the Senior Notes is fixed at 3.64% for the five year term of the agreement. The associated interest cost is recognized in interest expense in the period since drawdown in December 2015. In October 2015, the Company entered into an interest rate hedge in respect of the planned issuance of the Senior Notes in December 2015. The interest rate hedge matured in November 2015 when the interest rate on the Senior Notes was fixed. The interest rate hedge was effective in accordance with Financial Accounting Standards Board ("FASB") ASC 815, "Derivatives and Hedging". The cash proceeds ($4.6 million), representing the realized gain on the interest rate hedge, were received on maturity in November 2015 and are recorded within Other Comprehensive Income. The realized gain is being amortized to the income statement, net against interest payable, over the period of the Senior Notes. The Senior Notes agreement also includes certain financial covenants that require compliance with a consolidated leverage ratio, a minimum EBIT to consolidated net interest charge ratio and a maximum amount of priority debt, each of which are defined in the Note Purchase and Guarantee Agreement. The Company was in compliance with these covenants at December 31, 2017. The Senior Notes have not been, and will not be, registered under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. |
Impact of New Accounting Pronouncements |
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New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Impact of New Accounting Pronouncements | Impact of New Accounting Pronouncements Impact of new accounting pronouncements adopted during fiscal year-ended December 31, 2017 Accounting Standards Update (‘ASU’) 2016-09 ‘Improvements to Employee Share-Based Payment Accounting’ was issued in March 2016 which simplifies various aspects related to the accounting and presentation of share-based payments. The amendments require entities to record all tax effects related to share-based payments at settlement or expiration through the income statement and the windfall tax benefit to be recorded when it arises, subject to normal valuation allowance considerations. All tax-related cash flows resulting from share-based payments are required to be reported as operating activities in the statement of cash flows. The effective date of the new standard for public companies is for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. The Company has applied the modified retrospective approach, as required by the amendment to the standard, in determining the cumulative increase in retained earnings at January 1, 2017. This resulted in the recognition within non-current deferred tax assets of previously unrecognized excess tax benefits, as a credit to retained earnings, of $6.7 million. The Company has adopted the cash flow presentation prospectively. In July 2015, the FASB issued ASU 2015-11, which, for entities that do not measure inventory using the last-in, first-out (LIFO) or retail inventory method, changes the measurement principle for inventory from the lower of cost or market to lower of cost and net realizable value. The ASU also eliminates the requirement for these entities to consider replacement cost or net realizable value less an approximately normal profit margin when measuring inventory. This ASU is effective for public business entities in fiscal years beginning after December 15, 2016. The adoption of ASU 2015-11 did not impact on the financial statements. In January 2017, the FASB issued 'Accounting changes and error corrections and Investments - Equity method and joint ventures: Amendments to SEC paragraphs pursuant to staff announcements at the September 22, 2016 and November 17, 2016 EITF meetings (SEC update)' which incorporates into the FASB Accounting Standards Codification recent SEC guidance about disclosing, under SEC SAB Top 11.M, the effect on financial statements of adopting the revenue, leases, and credit losses standards. The Company has adopted the ASU in its December 31, 2017 financial statements. See the sections following. In October 2016, the FASB issued ASU 2016-17, 'Consolidation (Topic 810): Interests Held through Related Parties That Are under Common Control', which requires a single decision maker or service provider, in evaluating whether it is the primary beneficiary, to consider on a proportionate basis indirect interests held through related parties under common control. This ASU is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2016. The adoption of ASU 2016-17 did not have an impact on the financial statements. Financial statement effects of tax reform H.R.1 was enacted on December 22, 2017. The effective date of the law for most provisions is January 1, 2018 however the effects are required to be recognized in December 2017 financial statements. In response, the SEC staff issued SAB 118, which allows registrants to record provisional amounts during a 'measurement period'. See Note 13 for assessment of impact of H.R.1 on the December 31, 2017 financial statements. Impact of new accounting pronouncements which will be adopted during fiscal year-ended December 31, 2018 ASC 606 'Revenue from Contracts with Customers' In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which provides that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The updated standard will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. To achieve the core principle of the new standard, an entity should apply the following steps: (1) identify the contract(s) with a customer; (2) identify the performance obligations 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 a performance obligation. Early adoption is permitted for annual periods beginning after December 16, 2016. Subsequent to issuing ASU 2014-09, the FASB issued the following amendments concerning clarification of ASU 2014-09. In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers (Topic 606), Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (“ASU 2016-08”), which further clarifies the implementation guidance on principal versus agent considerations. The new guidance requires either a retrospective or a modified retrospective approach to adoption. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers (Topic 606), Identifying Performance Obligations and Licensing (“ASU 2016-10”), which clarifies the identification of performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients (“ASU 2016-12”), which provides clarification on assessing the collectability criterion, presentation of sales taxes, measurement date for non-cash consideration and completed contracts at transition. The updated standard is effective for ICON in the first quarter of the year ended December 31, 2018. ICON has elected to adopt the updated standard using the cumulative effect transition method. Under this transition method, ICON will apply the new standard as of the date of initial application (i.e. January 1, 2018), without restatement of comparative period amounts. ICON will record the cumulative effect of initially applying the new standard (to revenue and cost) as an adjustment to the opening balance of equity at the date of initial application. While we continue to assess all potential impacts of the new standard, we believe the most significant impact relates to our assessment of measurement of performance and percentage of completion in respect of our clinical trials service revenue. ICON will apply the requirements of the new standard to those contracts not completed at the date of initial application. The adoption of the new standard is expected to result in a cumulative reduction in shareholder's equity at January 1, 2018 (date of initial application) of an amount in the range of $40 million to $80 million reflecting cumulative adjustments to life to date revenue and associated costs. The full impact of adoption of the new standard, including the indirect impact (taxation and cost deferral adjustments) will be finalized in the first quarter of 2018 and is therefore subject to change. Under current GAAP, the revenue attributable to performance is determined based on both input and output methods of measurement based on the relationship between hours incurred and the total estimated hours of the trial, or on the unit of delivery method. We have evaluated the application of the requirements of ASC 606 to ‘recognize revenue when or as the entity satisfies a performance obligation’ to its business. We have concluded that under the revised standard, clinical trial service is a single performance obligation satisfied over time i.e. the full service obligation in respect of a clinical trial (including services provided by investigators and other parties) is considered a single performance obligation in respect of the clinical services revenue stream. Promises offered to the customer are not distinct within the context of the contract. We have also 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) adjusted to reflect historical experience to determine a realizable contract value. Revenue will be recognized as the single performance obligation is satisfied. The progress towards completion for clinical service contracts will be measured on an input measure of progress toward completion based on total project costs (inclusive of third party costs) at each reporting period. The revised standard includes additional disclosure requirements related to revenue. Our results for the first quarter of the year ended December 31, 2018, being the quarter ended March 31, 2018, will include expanded disclosure in respect of (i) disaggregated revenue disclosures from contracts with customers (ii) separate disclosure of contract assets and liabilities (iii) disclosure of retrospective revenue and (iv) disclosure of the remaining performance obligations by product/service (or backlog). Due to the complexity of certain of our contracts, the actual revenue recognition treatment required under the new standard for these arrangements may be dependent on contract-specific terms and vary in some instances. In May 2017, the FASB issued ASU 2017-10 'Service Concession Arrangements (Topic 853): Determining the Customer of the Operation Services' which clarifies that the customer in a service concession arrangement is always the grantor. This ASU is effective at the same time as ASU 2014-09, Revenue from Contracts with Customers (Topic 606) (the new revenue standard).
The adoption of the ASU is not expected to have a significant impact on the financial statements. In January 2017, the FASB issued ASU 2017-01 'Business combinations - Clarifying the definition of a business' to provide a new framework for determining whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This ASU is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2017. The ASU may be early adopted. The adoption of ASU 2017-01 is not expected to have a significant impact on the financial statements. In March 2017, the FASB issued ASU 2017-07 'Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost' which requires companies to present the service cost component of net benefit cost in the same line items in which they report compensation cost. Companies will present all other components of net benefit cost outside operating income, if this subtotal is presented. This ASU is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2017. The adoption of ASU 2017-07 is not expected to have a significant impact on the financial statements. In January 2016, the FASB issued ASU 2016-01 'Financial Instruments- Overall (Subtopic 825-10): Recognition and Measurement of the Financial Assets and Financial Liabilities' which will significantly change the income statement impact of equity investments and the recognition of changes in fair value of financial liabilities when the fair value option is elected. The ASU is effective for public business entities for interim and annual periods in fiscal years beginning after December 15, 2017. The adoption of ASU 2016-01 is not expected to have a significant impact on the financial statements. In March 2016, the FASB issued ASU 2016-04 , 'Recognition of Breakage for Certain Prepaid Stored-Value Products', which allows entities to recognize breakage on prepaid stored-value products consistent with how breakage is recognized under the new revenue standard. The exception applies to prepaid stored-value products in physical or digital form, with stored monetary values that are redeemable for goods and services, including those that can be redeemed for cash (e.g. prepaid gift cards issued on a specific payment network and redeemable at network-accepting merchant locations, prepaid telecommunication cards, and traveler's checks). The ASU is effective for public business entities for interim and annual periods in fiscal years beginning after December 15, 2017. The adoption of ASU 2016-04 is not expected to have a significant impact on the financial statements. In August 2016, the FASB issued ASU 2016-15, 'Classification of Certain Cash Receipts and Cash Payments', which addresses eight classification issues related to the statement of cash flows:
The ASU is effective for public business entities for interim and annual periods in fiscal years beginning after December 15, 2017. The adoption of ASU 2016-15 is not expected to have a significant impact on the financial statements. Any contingent consideration payment arrangements arising on business combinations effected in the future will be reviewed for cash flow statement classification in line with ASU 2016-15. In October 2016, the FASB issued ASU 2016-16, 'Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory', which requires entities to recognize at the transaction date the income tax consequences of intercompany asset transfers other than inventory. This ASU is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2017. For all other entities, the ASU is effective for annual periods in fiscal years beginning after December 15, 2018, and interim periods in fiscal years beginning after December 15, 2019. The adoption of ASU 2016-16 is not expected to have a significant impact on the financial statements. In November 2016, the FASB issued ASU 2016-18, 'Statement of Cash Flows (Topic 230): Restricted Cash', which requires companies to include cash and cash equivalents that have restrictions on withdrawal or use in total cash and cash equivalents on the statement of cash flows. This ASU is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2017. For all other entities, the ASU is effective for annual periods in fiscal years beginning after December 15, 2018, and interim periods in fiscal years beginning after December 15, 2019. The adoption of ASU 2016-18 is not expected to have a material impact on the financial statements. Impact of other new accounting pronouncements In January 2017, the FASB issued ASU 2017-04 'Intangibles - Goodwill and Other: Simplifying the test for goodwill impairment' which requires an entity to no longer perform a hypothetical purchase price allocation to measure goodwill impairment. Instead, impairment will be measured using the difference between the carrying amount and the fair value of the reporting unit. The ASU is effective for public businesses, that are SEC filers, for annual and interim periods in fiscal years beginning after December 15, 2019. The adoption of ASU 2017-04 is not expected to have a significant impact on the financial statements. In February 2017, the FASB issued ASU 2017-05 'Other Income-Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets'. In February 2017, the FASB issued ASU 2017-05, which clarifies the guidance in Subtopic 610-20 on accounting for derecognition of a nonfinancial asset. The ASU also defines in-substance nonfinancial assets and includes guidance on partial sales of non-financial assets. The adoption of ASU 2017-05 is not expected to have an impact on the financial statements. In July 2017, the FASB issued ASU 2017-11 'Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception' under which down round features will not cause certain equity-linked financial instruments to be accounted for as derivatives. A company that presents EPS information will reflect the effect of a down round feature of free-standing equity-linked financial instruments in EPS only if it is triggered. The ASU is effective for public business entities, for annual and interim periods in fiscal years beginning after December 15, 2018. The adoption of the ASU is not expected to have a significant impact on the financial statements. In August 2017, the FASB issue ASU 2017-12 'Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities' which changes the recognition and presentation requirements of hedge accounting, including:
The ASU also provides new alternatives for:
This ASU is effective for public business entities, for annual and interim periods in fiscal years beginning after December 15, 2018. Early adoption is permitted any time after the issuance of the ASU, including in an interim period. If adopted at other than the beginning of a fiscal year, cumulative effect adjustments are reflected as of the beginning of the fiscal year. The adoption of the ASU is not expected to have a significant impact on the financial statements. In February 2016, the FASB issued ASU 2016-02, 'Leases', requiring lessees to recognize a right-of-use asset and a lease liability on the Consolidated Balance Sheet for all leases with the exception of short-term leases. For lessees, leases will continue to be classified as either operating or finance leases in the income statement. Lessor accounting is similar to the current model but updated to align with certain changes to the lessee model. Lessors will continue to classify leases as operating, direct financing or sales-type leases. The effective date of the new standard for public companies is for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Early adoption is permitted. The new standard must be adopted using a modified retrospective transition and requires application of the new guidance at the beginning of the earliest comparative period presented. The updated standard is effective for us beginning in the first quarter of the year-ended December 31, 2019. We are currently evaluating the effect that the updated standard will have on our consolidated financial statements and related disclosures. See Note 16 Commitments and Contingencies for details of operating leases held during year-ended December 31, 2017. A lease liability and right-of-use asset will be recorded on the Consolidated Balance Sheet at December 31, 2019 and comparative periods will be restated to reflect the lease liabilities and right-of use assets. In June 2016, the FASB issued ASU 2016-13, 'Measurement of Credit Losses on Financial Instruments', which significantly changes the way entities recognize impairment of many financial assets by requiring immediate recognition of estimated credit losses expected to occur over their remaining life. The ASU is effective for public business entities that are SEC filers for interim and annual periods in fiscal years beginning after December 15, 2019. The adoption of ASU 2016-13 is not expected to have a significant impact on the financial statements. |
Related Parties |
12 Months Ended |
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Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Parties | Related Parties Subsidiaries of the Company earned revenue of $743,000 (2016: $100,000) from DS Biopharma Limited (formerly Dignity Sciences Limited) during the year. Dr. John Climax is Chief Executive Officer and both Dr. John Climax and Dr. Ronan Lambe are Directors and shareholders of DS Biopharma Limited. $220,000 was recorded as due from DS Biopharma Limited at December 31, 2017. The contract terms were agreed on an arm’s length basis. On July 22, 2016, Mr. Thomas Lynch retired as a Director of the Company, having previously resigned as Chairman of the Company in March 2016. A charge of €231,750 was recorded during 2017 in respect of consultancy services provided by a company controlled by Mr. Lynch. $64,000 was recorded as due to Mr. Lynch under the terms of the agreement at December 31, 2017. During the year ended December 31, 2017, personal expenses totaling $178,000 were settled by the Company on behalf of Mr Ciaran Murray. Payment was received in advance from Mr Murray in respect of these expenses. The Company transferred ownership of an asset at fair value ($77,000) to Mr Ciaran Murray effective November 1, 2017. Payment was received in full in January 2018. |
Subsequent Events |
12 Months Ended |
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Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events The Company has evaluated subsequent events from the balance sheet date through February 28, 2018, the date at which the consolidated financial statements were available to be issued. The Company has determined that there are no items to disclose. |
Significant Accounting Policies (Policies) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Consolidation | Basis of consolidation The consolidated financial statements include the financial statements of the Company and all of its subsidiaries. All significant intercompany profits, transactions and account balances have been eliminated. The results of subsidiary undertakings acquired in the period are included in the Consolidated Statement of Operations from the date of acquisition. |
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Use of Estimates | Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates. The principal management estimates and judgments used in preparing the financial statements relate to revenue recognition and taxation. |
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Revenue Recognition | Revenue recognition The Company primarily 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, biometric activities, consulting, imaging, contract staffing, informatics and laboratory services. Contracts range in duration from a number of months to several years. Revenue for services, as rendered, is recognized only after persuasive evidence of an arrangement exists, the sales price is fixed or determinable and collectability is reasonably assured. Clinical trials management revenue is recognized on a proportional performance method. Depending on the contractual terms revenue is either recognized on the percentage of completion method based on the relationship between hours incurred and the total estimated hours of the trial or on the unit of delivery method. Contract costs equate to the product of labor hours incurred and compensation rates. For the percentage of completion method, the input (effort expended) method has been used to measure progress towards completion as there is a direct relationship between input and productivity. Contract revenue is the product of the aggregated labor hours required to complete the specified contract tasks at the agreed contract rates. The Company regularly reviews the estimate of total contract time to ensure such estimates remain appropriate taking into account actual contract stage of completion, remaining time to complete and any identified changes to the contract scope. Remaining time to complete depends on the specific contract tasks, the complexity of the contract and can include geographical site selection and initiation, patient enrollment, patient testing and level of results analysis required. While the Company may routinely adjust time estimates, the Company's estimates and assumptions historically have been accurate in all material respects in the aggregate. Where revenue is recognized on the unit of delivery method, the basis applied is the number of units completed as a percentage of the total number of contractual units. Biometrics revenue is recognized on a fee-for-service method as each unit of data is prepared on the basis of the number of units completed in a period as a percentage of the total number of contracted units. Imaging revenue is recognized on a fee-for-service basis recognizing revenue for each image completed. Consulting revenue is recognized on a fee-for-service basis as each hour of the related service is performed. Contract staffing revenue is recognized on a fee-for-service basis, over the time the related service is performed, or in the case of permanent placement, once the candidate has been placed with the client. Informatics revenue is recognized on a fee-for-service basis. Informatics contracts are treated as multiple element arrangements, with contractual elements comprising license fee revenue, support fee revenue and revenue from software services, each of which can be sold separately. Sales prices for contractual elements are determined by reference to objective and reliable evidence of their sales price. License and support fee revenues are recognized rateably over the period of the related agreement. Revenue from software services is recognized using the percentage of completion method based on the relationship between hours incurred and the total estimated hours required to perform the service. Laboratory service revenue is recognized on a fee-for-service basis. The Company accounts for laboratory service contracts as multiple element arrangements, with contractual elements comprising laboratory kits and laboratory testing, each of which can be sold separately. Sales prices for contractual elements are determined by reference to objective and reliable evidence of their sales price. Revenues for contractual elements are recognized on the basis of the number of deliverable units completed in the period. Contracts generally contain provisions for renegotiation in the event of changes in the scope, nature, duration, or volume of services of the contract. Renegotiated amounts are recognized as revenue by revision to the total contract value arising as a result of an authorized customer change order. The difference between the amount of revenue recognized and the amount billed on a particular contract is included in the Consolidated Balance Sheet as unbilled revenue or payments on account. Normally, amounts become billable upon the achievement of certain milestones, for example, target patient enrollment rates, clinical testing sites initiated or case report forms completed. Once the milestone target is reached, amounts become billable in accordance with pre-agreed payment schedules included in the contract or on submission of appropriate billing detail. Such cash payments are not representative of revenue earned on the contract as revenues are recognized over the period in which the specified contractual obligations are fulfilled. Amounts included in unbilled revenue are expected to be collected within one year and are included within current assets. Advance billings to customers, for which revenue has not been recognized, are recognized as payments on account within current liabilities. In the event of contract termination, if the value of work performed and recognized as revenue is greater than aggregate milestone billings at the date of termination, cancellation clauses usually ensure that the Company is paid for all work performed to the termination date. |
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Reimbursable Expenses | Reimbursable expenses Reimbursable expenses comprise investigator payments and certain other costs which are reimbursed by clients under terms specific to each contract and are deducted from gross revenue in arriving at net revenue. Investigator payments are accrued based on patient enrollment over the life of the contract. Investigator payments are made based on predetermined contractual arrangements, which may differ from the accrual of the expense. |
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Direct Costs | Direct costs Direct costs consist of compensation, associated employee benefits and share-based payments for project-related employees and other direct project-related costs. |
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Advertising Costs | Advertising costs All costs associated with advertising and promotion are expensed as incurred. |
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Foreign Currencies and Translation of Subsidiaries | The financial statements of subsidiaries with other functional currencies are translated at period end rates for the Consolidated Balance Sheet and average rates for the Consolidated Statement of Operations. Translation gains and losses arising are reported as a movement on accumulated other comprehensive income. Foreign currency transaction gains and losses are reporting in other comprehensive income rather than through income where the foreign currency transaction is 'long-term investment' in nature i.e. settlement is not planned or anticipated in the foreseeable future. Foreign currencies and translation of subsidiaries The Company's financial statements are prepared in United States dollars. Transactions in currencies other than United States dollars are recorded at the rate ruling at the date of the transaction. Monetary assets and liabilities denominated in currencies other than United States dollars are translated into United States dollars at exchange rates prevailing at the Balance Sheet date. Adjustments resulting from these translations are charged or credited to income. |
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Disclosure About Fair Value of Financial Instruments | Disclosure about fair value of financial instruments Cash, cash equivalents, unbilled revenue, other receivables, short term investments, prepayments and other current assets, accounts receivable, accounts payable, investigator payments, payments on account, accrued liabilities, accrued bonuses 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. Financial instruments are measured in the Consolidated Balance Sheet fair value using a fair value hierarchy of valuation inputs. The 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:
The Company classifies its short term 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 Consolidated Statement of Operations. Losses other than temporary, which reduce the carrying amount below cost are recognized in Consolidated Statement of Operations. |
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Business Combinations | 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 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. |
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Goodwill and Impairment | Goodwill and Impairment 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. The Company tests goodwill annually for any impairments or whenever events occur which may indicate impairment. The first step is to compare the carrying amount of the reporting unit's assets to the fair value of the reporting unit. If the carrying amount exceeds the fair value then a second step is completed which involves the fair value of the reporting unit being allocated to each asset and liability with the excess being goodwill. The impairment loss is the amount by which the recorded goodwill exceeds the implied goodwill. |
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Intangible Assets | Intangible assets Intangible assets are amortized on a straight line basis over their estimated useful life. |
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Cash and Cash Equivalents | Cash and cash equivalents Cash and cash equivalents include cash and highly liquid investments with initial maturities of three months or less and are stated at cost, which approximates market value. |
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Short Term Investments - Available for Sale | Short term investments - available for sale The Company classifies short-term investments as available for sale in accordance with the terms of FASB ASC 320, Investments – Debt and Equity Securities. Realized gains and losses are determined using specific identification. The investments are reported at fair value, with unrealized gains or losses reported in a separate component of shareholders' equity. Any differences between the cost and fair value of the investments are represented by accrued interest and unrealized gains/losses. |
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Accounts Receivable, net | Accounts receivable, net Accounts receivable are recorded at fair value less an allowance for doubtful accounts. The allowance is an estimate based on historical collection experience, current economic and market conditions, and a review of the current status of each customer's trade accounts receivable. Account balances are written-off against the allowance when the Group determines that it is probable that the receivable will not be recovered. |
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Inventory | Inventory Inventory is valued at the lower of cost and net realizable value and after provisions for obsolescence. The cost of inventories comprises the purchase price and attributable costs, less trade discounts. At December 31, 2017 the carrying value of inventory, included within prepayments and other current assets on the Consolidated Balance Sheet, was $2.2 million (2016: $2.4 million). |
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Property, Plant and Equipment | Property, plant and equipment Property, plant and equipment is stated at cost less accumulated depreciation. Depreciation of property, plant and equipment is computed using the straight line method based on the estimated useful lives of the assets as listed below:
Leasehold improvements are amortized using the straight-line method over the estimated useful life of the asset or the lease term, whichever is shorter. |
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Leased Assets | Leased assets Costs in respect of operating leases are charged to the Consolidated Statement of Operations on a straight line basis over the lease term. Assets acquired under capital finance leases are included in the Consolidated Balance Sheet at the present value of the future minimum lease payments and are depreciated over the shorter of the lease term and their remaining useful lives. The corresponding liabilities are recorded in the Consolidated Balance Sheet and the interest element of the capital lease rental is charged to interest expense. |
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Income Taxes | Income taxes The Company applies the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance to the amount more likely than not to be realized. The Company recognizes the effect of income tax positions only if those positions will more likely than not be sustained. Recognized income tax positions are measured at the largest amount of tax benefit that is greater than 50 percent likely of being realized upon settlement. Interest and penalties related to income taxes are included in income tax expense and classified with the related liability on the Consolidated Balance Sheet. The Company intends to account for the impact of GILTI (“global intangible low-taxed income”) as a period item in the period it arises and has therefore not provided for deferred taxes in respect of this item. |
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Government Grants | Government grants Government grants received relating to capital expenditures are shown as deferred income and credited to income on a basis consistent with the depreciation policy of the relevant assets. Grants relating to categories of operating expenditures are credited to income in the period in which the expenditure to which they relate is charged. Under the grant agreements amounts received may become repayable in full should certain circumstances specified within the grant agreements occur, including downsizing by the Company, disposing of the related assets, ceasing to carry on its business or the appointment of a receiver over any of its assets. The Company has not recognized any loss contingency having assessed as remote the likelihood of these events arising. |
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Research and Development Credits | Research and development credits Research and development credits are available to the Company under the tax laws in certain jurisdictions, based on qualifying research and development spend as defined under those tax laws. Research and development credits are generally recognized as a reduction of income tax expense. However, certain tax jurisdictions provide refundable credits that are not wholly dependent on the Company's ongoing income tax status or income tax position. In these circumstances the benefit of these credits is not recorded as a reduction to income tax expense, but rather as a reduction of operating expenditure. |
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Pension Costs | Pension costs The Company contributes to defined contribution plans covering all eligible employees. The Company contributes to these plans based upon various fixed percentages of employee compensation and such contributions are expensed as incurred. The Company operates, through two subsidiaries, a defined benefit plan for certain of its United Kingdom and Swiss employees. The Company accounts for the costs of these plans using actuarial models required by FASB ASC 715-30 and these plans are presented in accordance with the requirements of FASB ASC 715-60 Defined Benefit Plans – Other Post retirement. |
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Net Income per Ordinary Share | Net income per ordinary share Basic net income per ordinary share 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. |
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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 FASB 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. Forfeitures are estimated on the date of grant and revised if actual or expected forfeiture activity differs materially from original estimates. 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. |
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Impairment of Long-Lived Assets | Impairment of long-lived assets Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the asset to future undiscounted net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured at the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of are reported at the lower of the carrying amount of the asset or fair value less selling costs. |
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Derivative Financial Instruments | Derivative financial instruments We enter into transactions in the normal course of business using various financial instruments in order to hedge against exposure to fluctuating exchange and interest rates. We use derivative financial instruments to reduce exposure to fluctuations in interest rates. A derivative is a financial instrument or other contract whose value changes in response to some underlying variable, which has an initial net investment smaller than would be required for other instruments that have a similar response to the variable and that will be settled at a future date. We do not enter into derivative financial instruments for trading or speculative purposes. We did not hold any interest rate swap contracts or forward currency contracts at December 31, 2016 or December 31, 2015. We use derivative financial instruments to reduce exposure to fluctuations in foreign exchange rates. During the year-ended December 31, 2017, we entered into forward currency contracts in respect of identified exposure arising from euro payments. The fair value of the derivative asset at December 31, 2017 was $1.2 million (included in other receivables). The forward currency contracts expire within 12 months of year-end. Our accounting policies for derivative financial instruments are based on whether they meet the criteria for designation as cash flow or fair value hedges. A designated hedge of the exposure to variability in the future cash flows of an asset or a liability, or of a forecasted transaction, is referred to as a cash flow hedge. A designated hedge of the exposure to changes in fair value of an asset or a liability is referred to as a fair value hedge. The criterion for designating a derivative as a hedge includes the assessment of the instrument's effectiveness in risk reduction, matching of the derivative instrument to its underlying transaction and the probability that the underlying transaction will occur. For derivatives with cash flow hedge accounting designation, we report the gain or loss from the effective portion of the hedge as a component of Other Comprehensive Income and reclassify it into earnings in the same period or periods in which the hedged transaction affects earnings and within the same income statement line item as the impact of the hedged transaction. For derivatives with fair value hedge accounting designation, we recognize gains or losses from the change in fair value of these derivatives, as well as the offsetting change in the fair value of the underlying hedged item, in earnings. Fair value gains and losses arising on derivative financial instruments not qualifying for hedge accounting are reported in our Consolidated Statement of Operations. |
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Financing Costs and Gain on Interest Rate Hedge | Financing costs and gain on interest rate hedge The interest rate in respect of the Senior Notes is fixed at 3.64% for the five year term of the agreement. The associated interest cost is recognized in interest expense in the period since drawdown in December 2015. On October 5, 2015, the Company entered into an interest rate hedge in respect of the planned issuance of the Senior Notes in December 2015. The interest rate hedge matured on November 17, 2015 when the interest rate on the Senior Notes was fixed. The interest rate hedge was effective in accordance with Financial Accounting Standards Board ("FASB") ASC 815, "Derivatives and Hedging". The cash proceeds ($4.6 million), representing the realized gain on the interest rate hedge, were received on maturity in November 2015 and are recorded within Other Comprehensive Income. The realized gain will be amortized to the Consolidated Statement of Operations, net against interest payable, over the period of the Senior Notes. Deferred financing costs (including issue costs relating to the Senior Notes) are reported at cost less accumulated amortization and the related amortization expense is included in interest expense, in our Consolidated Statement of Operations. |
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Reclassifications | Reclassifications Certain amounts in the consolidated financial statements have been reclassified where necessary to conform to the current year presentation. |
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New Accounting Pronouncements, Policy | Impact of new accounting pronouncements adopted during fiscal year-ended December 31, 2017 Accounting Standards Update (‘ASU’) 2016-09 ‘Improvements to Employee Share-Based Payment Accounting’ was issued in March 2016 which simplifies various aspects related to the accounting and presentation of share-based payments. The amendments require entities to record all tax effects related to share-based payments at settlement or expiration through the income statement and the windfall tax benefit to be recorded when it arises, subject to normal valuation allowance considerations. All tax-related cash flows resulting from share-based payments are required to be reported as operating activities in the statement of cash flows. The effective date of the new standard for public companies is for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. The Company has applied the modified retrospective approach, as required by the amendment to the standard, in determining the cumulative increase in retained earnings at January 1, 2017. This resulted in the recognition within non-current deferred tax assets of previously unrecognized excess tax benefits, as a credit to retained earnings, of $6.7 million. The Company has adopted the cash flow presentation prospectively. In July 2015, the FASB issued ASU 2015-11, which, for entities that do not measure inventory using the last-in, first-out (LIFO) or retail inventory method, changes the measurement principle for inventory from the lower of cost or market to lower of cost and net realizable value. The ASU also eliminates the requirement for these entities to consider replacement cost or net realizable value less an approximately normal profit margin when measuring inventory. This ASU is effective for public business entities in fiscal years beginning after December 15, 2016. The adoption of ASU 2015-11 did not impact on the financial statements. In January 2017, the FASB issued 'Accounting changes and error corrections and Investments - Equity method and joint ventures: Amendments to SEC paragraphs pursuant to staff announcements at the September 22, 2016 and November 17, 2016 EITF meetings (SEC update)' which incorporates into the FASB Accounting Standards Codification recent SEC guidance about disclosing, under SEC SAB Top 11.M, the effect on financial statements of adopting the revenue, leases, and credit losses standards. The Company has adopted the ASU in its December 31, 2017 financial statements. See the sections following. In October 2016, the FASB issued ASU 2016-17, 'Consolidation (Topic 810): Interests Held through Related Parties That Are under Common Control', which requires a single decision maker or service provider, in evaluating whether it is the primary beneficiary, to consider on a proportionate basis indirect interests held through related parties under common control. This ASU is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2016. The adoption of ASU 2016-17 did not have an impact on the financial statements. Financial statement effects of tax reform H.R.1 was enacted on December 22, 2017. The effective date of the law for most provisions is January 1, 2018 however the effects are required to be recognized in December 2017 financial statements. In response, the SEC staff issued SAB 118, which allows registrants to record provisional amounts during a 'measurement period'. See Note 13 for assessment of impact of H.R.1 on the December 31, 2017 financial statements. Impact of new accounting pronouncements which will be adopted during fiscal year-ended December 31, 2018 ASC 606 'Revenue from Contracts with Customers' In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which provides that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The updated standard will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. To achieve the core principle of the new standard, an entity should apply the following steps: (1) identify the contract(s) with a customer; (2) identify the performance obligations 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 a performance obligation. Early adoption is permitted for annual periods beginning after December 16, 2016. Subsequent to issuing ASU 2014-09, the FASB issued the following amendments concerning clarification of ASU 2014-09. In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers (Topic 606), Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (“ASU 2016-08”), which further clarifies the implementation guidance on principal versus agent considerations. The new guidance requires either a retrospective or a modified retrospective approach to adoption. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers (Topic 606), Identifying Performance Obligations and Licensing (“ASU 2016-10”), which clarifies the identification of performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients (“ASU 2016-12”), which provides clarification on assessing the collectability criterion, presentation of sales taxes, measurement date for non-cash consideration and completed contracts at transition. The updated standard is effective for ICON in the first quarter of the year ended December 31, 2018. ICON has elected to adopt the updated standard using the cumulative effect transition method. Under this transition method, ICON will apply the new standard as of the date of initial application (i.e. January 1, 2018), without restatement of comparative period amounts. ICON will record the cumulative effect of initially applying the new standard (to revenue and cost) as an adjustment to the opening balance of equity at the date of initial application. While we continue to assess all potential impacts of the new standard, we believe the most significant impact relates to our assessment of measurement of performance and percentage of completion in respect of our clinical trials service revenue. ICON will apply the requirements of the new standard to those contracts not completed at the date of initial application. The adoption of the new standard is expected to result in a cumulative reduction in shareholder's equity at January 1, 2018 (date of initial application) of an amount in the range of $40 million to $80 million reflecting cumulative adjustments to life to date revenue and associated costs. The full impact of adoption of the new standard, including the indirect impact (taxation and cost deferral adjustments) will be finalized in the first quarter of 2018 and is therefore subject to change. Under current GAAP, the revenue attributable to performance is determined based on both input and output methods of measurement based on the relationship between hours incurred and the total estimated hours of the trial, or on the unit of delivery method. We have evaluated the application of the requirements of ASC 606 to ‘recognize revenue when or as the entity satisfies a performance obligation’ to its business. We have concluded that under the revised standard, clinical trial service is a single performance obligation satisfied over time i.e. the full service obligation in respect of a clinical trial (including services provided by investigators and other parties) is considered a single performance obligation in respect of the clinical services revenue stream. Promises offered to the customer are not distinct within the context of the contract. We have also 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) adjusted to reflect historical experience to determine a realizable contract value. Revenue will be recognized as the single performance obligation is satisfied. The progress towards completion for clinical service contracts will be measured on an input measure of progress toward completion based on total project costs (inclusive of third party costs) at each reporting period. The revised standard includes additional disclosure requirements related to revenue. Our results for the first quarter of the year ended December 31, 2018, being the quarter ended March 31, 2018, will include expanded disclosure in respect of (i) disaggregated revenue disclosures from contracts with customers (ii) separate disclosure of contract assets and liabilities (iii) disclosure of retrospective revenue and (iv) disclosure of the remaining performance obligations by product/service (or backlog). Due to the complexity of certain of our contracts, the actual revenue recognition treatment required under the new standard for these arrangements may be dependent on contract-specific terms and vary in some instances. In May 2017, the FASB issued ASU 2017-10 'Service Concession Arrangements (Topic 853): Determining the Customer of the Operation Services' which clarifies that the customer in a service concession arrangement is always the grantor. This ASU is effective at the same time as ASU 2014-09, Revenue from Contracts with Customers (Topic 606) (the new revenue standard).
The adoption of the ASU is not expected to have a significant impact on the financial statements. In January 2017, the FASB issued ASU 2017-01 'Business combinations - Clarifying the definition of a business' to provide a new framework for determining whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This ASU is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2017. The ASU may be early adopted. The adoption of ASU 2017-01 is not expected to have a significant impact on the financial statements. In March 2017, the FASB issued ASU 2017-07 'Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost' which requires companies to present the service cost component of net benefit cost in the same line items in which they report compensation cost. Companies will present all other components of net benefit cost outside operating income, if this subtotal is presented. This ASU is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2017. The adoption of ASU 2017-07 is not expected to have a significant impact on the financial statements. In January 2016, the FASB issued ASU 2016-01 'Financial Instruments- Overall (Subtopic 825-10): Recognition and Measurement of the Financial Assets and Financial Liabilities' which will significantly change the income statement impact of equity investments and the recognition of changes in fair value of financial liabilities when the fair value option is elected. The ASU is effective for public business entities for interim and annual periods in fiscal years beginning after December 15, 2017. The adoption of ASU 2016-01 is not expected to have a significant impact on the financial statements. In March 2016, the FASB issued ASU 2016-04 , 'Recognition of Breakage for Certain Prepaid Stored-Value Products', which allows entities to recognize breakage on prepaid stored-value products consistent with how breakage is recognized under the new revenue standard. The exception applies to prepaid stored-value products in physical or digital form, with stored monetary values that are redeemable for goods and services, including those that can be redeemed for cash (e.g. prepaid gift cards issued on a specific payment network and redeemable at network-accepting merchant locations, prepaid telecommunication cards, and traveler's checks). The ASU is effective for public business entities for interim and annual periods in fiscal years beginning after December 15, 2017. The adoption of ASU 2016-04 is not expected to have a significant impact on the financial statements. In August 2016, the FASB issued ASU 2016-15, 'Classification of Certain Cash Receipts and Cash Payments', which addresses eight classification issues related to the statement of cash flows:
The ASU is effective for public business entities for interim and annual periods in fiscal years beginning after December 15, 2017. The adoption of ASU 2016-15 is not expected to have a significant impact on the financial statements. Any contingent consideration payment arrangements arising on business combinations effected in the future will be reviewed for cash flow statement classification in line with ASU 2016-15. In October 2016, the FASB issued ASU 2016-16, 'Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory', which requires entities to recognize at the transaction date the income tax consequences of intercompany asset transfers other than inventory. This ASU is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2017. For all other entities, the ASU is effective for annual periods in fiscal years beginning after December 15, 2018, and interim periods in fiscal years beginning after December 15, 2019. The adoption of ASU 2016-16 is not expected to have a significant impact on the financial statements. In November 2016, the FASB issued ASU 2016-18, 'Statement of Cash Flows (Topic 230): Restricted Cash', which requires companies to include cash and cash equivalents that have restrictions on withdrawal or use in total cash and cash equivalents on the statement of cash flows. This ASU is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2017. For all other entities, the ASU is effective for annual periods in fiscal years beginning after December 15, 2018, and interim periods in fiscal years beginning after December 15, 2019. The adoption of ASU 2016-18 is not expected to have a material impact on the financial statements. Impact of other new accounting pronouncements In January 2017, the FASB issued ASU 2017-04 'Intangibles - Goodwill and Other: Simplifying the test for goodwill impairment' which requires an entity to no longer perform a hypothetical purchase price allocation to measure goodwill impairment. Instead, impairment will be measured using the difference between the carrying amount and the fair value of the reporting unit. The ASU is effective for public businesses, that are SEC filers, for annual and interim periods in fiscal years beginning after December 15, 2019. The adoption of ASU 2017-04 is not expected to have a significant impact on the financial statements. In February 2017, the FASB issued ASU 2017-05 'Other Income-Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets'. In February 2017, the FASB issued ASU 2017-05, which clarifies the guidance in Subtopic 610-20 on accounting for derecognition of a nonfinancial asset. The ASU also defines in-substance nonfinancial assets and includes guidance on partial sales of non-financial assets. The adoption of ASU 2017-05 is not expected to have an impact on the financial statements. In July 2017, the FASB issued ASU 2017-11 'Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception' under which down round features will not cause certain equity-linked financial instruments to be accounted for as derivatives. A company that presents EPS information will reflect the effect of a down round feature of free-standing equity-linked financial instruments in EPS only if it is triggered. The ASU is effective for public business entities, for annual and interim periods in fiscal years beginning after December 15, 2018. The adoption of the ASU is not expected to have a significant impact on the financial statements. In August 2017, the FASB issue ASU 2017-12 'Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities' which changes the recognition and presentation requirements of hedge accounting, including:
The ASU also provides new alternatives for:
This ASU is effective for public business entities, for annual and interim periods in fiscal years beginning after December 15, 2018. Early adoption is permitted any time after the issuance of the ASU, including in an interim period. If adopted at other than the beginning of a fiscal year, cumulative effect adjustments are reflected as of the beginning of the fiscal year. The adoption of the ASU is not expected to have a significant impact on the financial statements. In February 2016, the FASB issued ASU 2016-02, 'Leases', requiring lessees to recognize a right-of-use asset and a lease liability on the Consolidated Balance Sheet for all leases with the exception of short-term leases. For lessees, leases will continue to be classified as either operating or finance leases in the income statement. Lessor accounting is similar to the current model but updated to align with certain changes to the lessee model. Lessors will continue to classify leases as operating, direct financing or sales-type leases. The effective date of the new standard for public companies is for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Early adoption is permitted. The new standard must be adopted using a modified retrospective transition and requires application of the new guidance at the beginning of the earliest comparative period presented. The updated standard is effective for us beginning in the first quarter of the year-ended December 31, 2019. We are currently evaluating the effect that the updated standard will have on our consolidated financial statements and related disclosures. See Note 16 Commitments and Contingencies for details of operating leases held during year-ended December 31, 2017. A lease liability and right-of-use asset will be recorded on the Consolidated Balance Sheet at December 31, 2019 and comparative periods will be restated to reflect the lease liabilities and right-of use assets. In June 2016, the FASB issued ASU 2016-13, 'Measurement of Credit Losses on Financial Instruments', which significantly changes the way entities recognize impairment of many financial assets by requiring immediate recognition of estimated credit losses expected to occur over their remaining life. The ASU is effective for public business entities that are SEC filers for interim and annual periods in fiscal years beginning after December 15, 2019. The adoption of ASU 2016-13 is not expected to have a significant impact on the financial statements. |
Significant Accounting Policies (Tables) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||
Adjustments Resulting From Foreign Currency Translations | Amounts charged or credited to the Consolidated Statement of Operations for the years ended December 31, 2017, December 31, 2016 and December 31, 2015 were as follows:
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Estimated Useful Lives of Assets | Depreciation of property, plant and equipment is computed using the straight line method based on the estimated useful lives of the assets as listed below:
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Reconciliation of Number of Shares Used in Computation of Basic and Diluted Net Income Per Ordinary Share | The reconciliation of the number of shares used in the computation of basic and diluted net income per ordinary share is as follows:
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Short term investments - available for sale (Tables) |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cost and Fair Value of Investments |
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Available For Sale Short Term Investments by Major Security Type | The following table represents our available for sale short term investments by major security type as of December 31, 2017:
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Goodwill (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Goodwill |
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Summary of Estimates of Fair Values of Assets Acquired and Liabilities Assumed | The table following summarizes the Company’s provisional estimates of the fair values of the assets acquired and liabilities assumed:
*Goodwill represents the acquisition of an established workforce with experience in late phase commercialization, analytics, real world evidence generation and strategic regulatory services in clinical trial services for biologics, drugs and devices. Goodwill related to the business acquired is not tax deductible. **The Company has made an initial estimate of separate intangible assets acquired of $32.3 million, being customer relationships and order book assets. This assessment is under review and will be finalized within 12 months of the date of acquisition. The following table summarizes the fair values of the assets acquired and liabilities assumed on acquisition:
The table following summarizes the fair values of the assets acquired and liabilities assumed:
*Goodwill represents the acquisition of an established workforce with experience in preclinical through Phase IV support of clinical research and clinical trial services for biologics, drugs and devices. Goodwill related to the US portion of the business acquired is tax deductible. In finalizing the goodwill on acquisition of CRM in the twelve month period from acquisition, fair value adjustments were made which resulted in an increase to unbilled revenue ($1.1 million) and other liabilities ($1.1 million) and in a decrease to accounts receivable ($0.3 million) and accounts payable ($0.5 million). Customer list, order backlog and brand intangible asset values were also finalized. The table following summarizes the fair values of the assets acquired and liabilities assumed;
*Goodwill represents the acquisition of an established workforce with experience in clinical trial consulting and regulatory support for the development of drugs, medical devices and diagnostics, with a specific focus on strategy to increase efficiency and productivity in product development. In finalizing the goodwill on acquisition of PMG in the twelve month period from acquisition, fair value adjustments of $7.7 million were made to deferred tax liabilities ($3.1 million), accounts receivable acquired ($1.4 million), other liabilities ($1.2 million) and the value of the customer list and order backlog assets acquired ($0.4 million). Additional consideration of $1.6 million was provided on completion of the contractual working capital process. |
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Summary of Proforma Effect in Net Revenue Net Income and Earnings Per Share | The proforma effect of the PMG acquisition if completed on January 1, 2014 would have resulted in net revenue, net income and earnings per share for the fiscal years ended December 31, 2015 and December 31, 2014 as follows:
The proforma effect of the Mapi acquisition if completed on January 1, 2016 would have resulted in net revenue, net income and earnings per share for the fiscal years ending December 31, 2017 and December 31, 2016 as follows:
The proforma effect of the MediMedia Pharma Solutions acquisition if completed on January 1, 2014 would have resulted in net revenue, net income and earnings per share for the fiscal years ended December 31, 2015 and December 31, 2014 as follows:
The proforma effect of the ClinicalRM acquisition if completed on January 1, 2015 would have resulted in net revenue, net income and earnings per share for the fiscal years ended December 31, 2016 and December 31, 2015 as follows:
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Intangible Assets (Tables) |
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Schedule of Intangible Assets |
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Schedule of Future Intangible Asset Amortization Expense | Future intangible asset amortization expense for the years ended December 31, 2018 to December 31, 2022 is as follows:
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Property, Plant and Equipment, net (Tables) |
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Schedule of Property Plant and Equipment Net |
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Other Liabilities (Tables) |
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Other Liabilities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Liabilities |
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Non-Current Other Liabilities (Tables) |
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Non-Current Other Liabilities |
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Employee Benefits (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Pension Costs | The pension costs of this plan are presented in the following tables in accordance with the requirements of ASC 715-60, Defined Benefit Plans – Other Postretirement. The plan has been closed to new entrants with effect from July 1, 2003.
The pension costs of this plan are presented in the following tables in accordance with the requirements of ASC 715-60, Defined Benefit Plans – Other Postretirement.
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Schedule of Funded Status |
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Schedule of Components of Net Periodic Benefit Cost | The following amounts were recorded in the Consolidated Statement of Operations as components of the net periodic benefit cost:
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Summary of Assumptions Used in Calculating Net Periodic Benefit Cost | The following assumptions were used at the commencement of the year in determining the net periodic pension benefit cost for the years ended December 31, 2017, December 31, 2016 and December 31, 2015:
The following assumptions were used at the commencement of the year in determining the net periodic pension benefit cost for the years ended December 31, 2017, December 31, 2016 and December 31, 2015:
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Summary of Amounts Recognized in Accumulated Other Comprehensive Income Which Have Not Yet Been Recognized as Components of Net Periodic Benefit Cost | Amounts recognized in accumulated other comprehensive income that have not yet been recognized as components of net periodic benefit cost are as follows:
Amounts recognized in accumulated other comprehensive income that have not yet been recognized as components of net periodic benefit cost are as follows:
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Summary of Assumptions Used in Calculating Pension Benefit Obligations | The following assumptions were used in determining the benefit obligation at December 31, 2017 and December 31, 2016:
The following assumptions were used in determining the benefit obligation at December 31, 2017 and December 31, 2016:
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Summary of Expected Long Term Rates of Return on Different Asset Classes | The expected long term rates of return on different asset classes are as follows:
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Schedule of underlying asset split of fund | The underlying asset split of the fund is shown below.
The following annual benefit payments, which reflect expected future service as appropriate, are expected to be paid.
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Schedule of Plan Asset Fair Value Measurements |
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Schedule of Annual Benefit Payments which Reflect Expected Future Service | The following annual benefit payments, which reflect expected future service as appropriate, are expected to be paid.
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Equity Incentive Schemes and Stock Compensation Charges (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Transactions for Company's Share Option Plans | The following table summarizes the transactions for the Company's share option plans for the years ended December 31, 2017, December 31, 2016 and December 31, 2015:
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Schedule of Non Vested Shares Outstanding | Non-vested shares outstanding as at December 31, 2017 are as follows:
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Summary of Information Concerning Outstanding and Exercisable Share Options | The following table summarizes information concerning outstanding and exercisable share options as of December 31, 2017:
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Summary of Weighted Average Fair Values and Assumptions Used | The weighted average fair values and assumptions were as follows:
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Summary of RSU and PSU Activity | The following table summarizes RSU and PSU activity for the year ended December 31, 2017:
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Schedule of Non-cash Stock Compensation Expense | Non-cash stock compensation expense has been allocated as follows:
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Government Grants (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Revenue Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Government Grant |
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Income Taxes (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Components of Income Before Provision for Income Taxes | The components of income before provision for income taxes are as follows:
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Summary of Components of Provision for Income Taxes | The components of provision for income taxes are as follows:
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Schedule of Reconciliation of Consolidated Reported Provision for Income Taxes and Statutory Rate | The Company's consolidated reported provision for income taxes differed from the amount that would result from applying the Irish statutory rate as set forth below:
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Schedule of Tax Effects of Temporary Differences that Give Rise to Significant Portions of Deferred Tax Assets and Deferred Tax Liabilities | The tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities are presented below:
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Schedule of Expected Expiry Dates of NOL's | The expected expiry dates of these losses are as follows:
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Schedule of Reconciliation of Beginning and Ending Amount of Total Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of total unrecognized tax benefits is as follows:
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Restructuring and other items (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Recognized Restructuring and Other Items, Net | Restructuring and other items recognized during the year ended December 31, 2017 comprise:
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Schedule of Restructuring Charges |
|
Provision for Doubtful Debts (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts Receivable, Net [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Provision for Doubtful Debts | The Company does business with most major international pharmaceutical companies. Provision for doubtful debts at December 31, 2017 comprises:
|
Commitments and Contingencies (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||
Schedule of Future Minimum Rental Commitments for Operating Leases with Non-cancelable Terms | Future minimum rental commitments for operating leases with non-cancelable terms in excess of one year are as follows:
|
Business Segment and Geographical Information (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Distribution of Net Revenue by Geographical Area | The distribution of net revenue by geographical area was as follows:
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Schedule of Distribution of Income from Operations by Geographical Area | The distribution of income from operations, including restructuring and other items, by geographical area was as follows:
c) The distribution of income from operations, excluding restructuring and other items, by geographical area was as follows:
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Schedule of Distribution of Property, Plant and Equipment, Net, by Geographical Area | The distribution of property, plant and equipment, net, by geographical area was as follows:
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Schedule of Distribution of Depreciation and Amortization by Geographical Area | The distribution of depreciation and amortization by geographical area was as follows:
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Schedule of Distribution of Total Assets by Geographical Area | The distribution of total assets by geographical area was as follows:
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Schedule of Distribution of Capital Expenditures by Geographical Area | The distribution of capital expenditures by geographical area was as follows:
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Schedule of Clients Representing Company's Net Revenue | The following table sets forth the clients which represented 10% or more of the Company's net revenue in each of the periods set out below.
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Schedule of Distribution of Interest Income by Business Segment | The distribution of interest income by geographical area was as follows:
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Schedule of Distribution of Tax Charge by Geographical Area | The distribution of the income tax charge by geographical area was as follows:
|
Supplemental Disclosure of Cash Flow Information (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Elements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Supplemental Disclosure of Cash Flow Information |
|
Accumulated Other Comprehensive Income (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income |
|
Description of Business - Additional Information (Detail) |
12 Months Ended |
---|---|
Dec. 31, 2017
Employee
Country
Location
| |
Product Information [Line Items] | |
Number of employees | Employee | 13,250 |
Number of locations in which company operates | Location | 98 |
Number of countries in which company operates | Country | 38 |
Geographic Concentration Risk | United States | Net Revenue | |
Product Information [Line Items] | |
Percentage of company revenue | 45.00% |
Geographic Concentration Risk | Europe | Net Revenue | |
Product Information [Line Items] | |
Percentage of company revenue | 43.30% |
Geographic Concentration Risk | Rest of World | Net Revenue | |
Product Information [Line Items] | |
Percentage of company revenue | 11.70% |
Significant Accounting Policies - Additional Information (Detail) - USD ($) |
1 Months Ended | 3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Nov. 30, 2015 |
Dec. 31, 2017 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Significant Accounting Policies [Line Items] | |||||
Advertising and promotion costs | $ 6,744,333 | $ 7,167,050 | $ 4,513,750 | ||
Goodwill impairment charge | 0 | 0 | 0 | ||
Carrying value of inventory | $ 2,200,000 | 2,200,000 | 2,400,000 | ||
Cash proceeds from interest rate hedge | $ 0 | $ 0 | $ 4,658,000 | ||
Derivative remaining maturity | 12 months | ||||
Senior Notes | |||||
Significant Accounting Policies [Line Items] | |||||
Debt instrument, interest rate | 3.64% | 3.64% | |||
Debt instrument, term | 5 years | 5 years | |||
Interest rate hedge, inception date | Oct. 05, 2015 | ||||
Interest rate hedge, maturity date | Nov. 17, 2015 | ||||
Cash proceeds from interest rate hedge | $ 4,600,000 | $ 4,600,000 | |||
Other receivable | |||||
Significant Accounting Policies [Line Items] | |||||
Fair value of derivative asset | $ 1,200,000 | $ 1,200,000 |
Adjustments Resulting from Foreign Currency Translation (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Foreign Currency [Abstract] | |||
Amounts charged/(credited) | $ 7,760 | $ 2,094 | $ (3,608) |
Estimated Useful Lives of Assets (Detail) |
12 Months Ended |
---|---|
Dec. 31, 2017 | |
Building | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 40 years |
Computer equipment and software | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 2 years |
Computer equipment and software | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 8 years |
Office furniture and fixtures | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 8 years |
Laboratory equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Motor vehicles | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Reconciliation of Number of Shares Used in Computation of Basic and Diluted Net Income Per Ordinary Share (Detail) - shares |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Earnings Per Share [Abstract] | |||
Weighted average number of ordinary shares outstanding for basic net income per ordinary share (in shares) | 54,129,439 | 55,248,900 | 58,746,935 |
Effect of dilutive share options outstanding (in shares) | 719,607 | 1,158,236 | 1,543,098 |
Weighted average number of ordinary shares outstanding for diluted net income per ordinary share (in shares) | 54,849,046 | 56,407,136 | 60,290,033 |
Cost and Fair Value of Investments (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Investments, Debt and Equity Securities [Abstract] | |||
At start of year | $ 68,046 | $ 85,990 | |
Purchases | 41,701 | 22,030 | |
Sales and maturities | (33,086) | (40,858) | |
Interest on short term investments | 1,088 | 823 | $ 571 |
Realized gain on sale of short term investments | 112 | 50 | (113) |
Unrealized capital (loss)/gain – investments | (272) | 11 | |
At end of year | $ 77,589 | $ 68,046 | $ 85,990 |
Short Team Investments - Available for Sale - Additional Information (Detail) |
12 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Investments, Debt and Equity Securities [Abstract] | ||
Short term investments average maturity period | 1 year 6 months 29 days | 1 year 4 months 13 days |
Schedule of Goodwill (Detail) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Goodwill [Roll Forward] | ||
Opening goodwill | $ 616,088 | $ 588,434 |
Current year acquisitions (note 4 (a)) | 129,222 | 34,576 |
Prior period acquisition (note 4 (b)) | 1,393 | 7,689 |
Foreign exchange movement | 22,355 | (14,611) |
Closing goodwill | $ 769,058 | $ 616,088 |
Intangible Assets (Detail) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Cost | ||
Total cost | $ 155,103 | $ 120,164 |
Foreign exchange movement | (2,389) | (6,578) |
Accumulated amortization | (84,898) | (67,037) |
Foreign exchange movement Accumulated Amortization | 1,423 | 3,483 |
Net book value | 71,628 | 56,610 |
Customer relationships acquired | ||
Cost | ||
Total cost | 91,230 | 92,110 |
Technology asset acquired | ||
Cost | ||
Total cost | 11,169 | 11,169 |
Order backlog | ||
Cost | ||
Total cost | 18,208 | 18,574 |
Trade names/ brands acquired | ||
Cost | ||
Total cost | 2,766 | 3,075 |
Volunteer list acquired | ||
Cost | ||
Total cost | 1,325 | 1,325 |
Non-compete arrangements | ||
Cost | ||
Total cost | 489 | 489 |
Mapi intangible asset | ||
Cost | ||
Total cost | $ 32,305 | $ 0 |
Future Intangible Asset Amortization Expense (Detail) $ in Thousands |
Dec. 31, 2017
USD ($)
|
---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | |
2018 | $ 19,788 |
2019 | 16,217 |
2020 | 13,867 |
2021 | 11,906 |
2022 | 6,580 |
Finite Lived Intangible Assets, Amortization Expense, Net, Total | $ 68,358 |
Property, Plant and Equipment, Net (Detail) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Property, Plant and Equipment [Abstract] | ||
Land | $ 3,464 | $ 3,464 |
Building | 88,411 | 77,950 |
Computer equipment and software | 358,874 | 315,984 |
Office furniture and fixtures | 78,372 | 70,218 |
Laboratory equipment | 34,918 | 31,487 |
Leasehold improvements | 24,097 | 20,933 |
Motor vehicles | 42 | 43 |
Property, Plant and Equipment, Gross, Total | 588,178 | 520,079 |
Less accumulated depreciation and asset write offs | (425,127) | (371,112) |
Property, plant and equipment (net) | $ 163,051 | $ 148,967 |
Other Liabilities (Detail) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Other Liabilities Disclosure [Abstract] | ||
Personnel related liabilities | $ 168,964 | $ 135,349 |
Facility related liabilities | 13,061 | 14,182 |
General overhead liabilities | 41,789 | 31,126 |
Other liabilities | 4,628 | 7,584 |
Short term government grants (note 11) | 35 | 54 |
Restructuring and other items (note 14) | 5,026 | 2,432 |
Other liabilities | $ 233,503 | $ 190,727 |
Non-Current Other Liabilities (Detail) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Payables and Accruals [Abstract] | ||
Defined benefit pension obligations, net (note 9) | $ 6,061 | $ 8,952 |
Other non-current liabilities | 11,050 | 14,800 |
Non-current other liabilities | $ 17,111 | $ 23,752 |
Change in Benefit Obligations (Detail) - Foreign Plan - Pension Plan - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
United Kingdom | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Benefit obligation at beginning of year | $ 32,906 | $ 27,369 | |
Service cost | 112 | 75 | $ 78 |
Interest cost | 929 | 1,017 | 1,140 |
Plan participants' contributions | 22 | 22 | |
Expenses | (8) | 8 | 0 |
Benefits paid | (68) | (104) | |
Actuarial loss | 658 | 10,057 | |
Foreign currency exchange rate changes | 3,208 | (5,538) | |
Benefit obligation at end of year | 37,759 | 32,906 | 27,369 |
Switzerland | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Benefit obligation at beginning of year | 6,928 | 8,537 | |
Service cost | 243 | 352 | |
Interest cost | 54 | 82 | |
Plan participants' contributions | 120 | 150 | |
Settlement | (1,019) | (909) | |
Prior service cost | 0 | (88) | |
Transferred (benefits paid)/balances | (76) | 53 | |
Actuarial loss | (626) | (1,157) | |
Foreign currency exchange rate changes | 303 | (92) | |
Benefit obligation at end of year | $ 5,927 | $ 6,928 | $ 8,537 |
Funded Status (Detail) - Foreign Plan - Pension Plan - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|---|
United Kingdom | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Projected benefit obligation | $ (37,759) | $ (32,906) | |
Fair value of plan assets | 32,423 | 24,876 | $ 23,367 |
Funded status | (5,336) | (8,030) | |
Non-current other liabilities (note 8) | (5,336) | (8,030) | |
Switzerland | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Projected benefit obligation | (5,927) | (6,928) | |
Fair value of plan assets | 5,202 | 6,006 | $ 5,350 |
Funded status | (725) | (922) | |
Non-current other liabilities (note 8) | $ (725) | $ (922) |
Amounts recognized in accumulated other comprehensive income that have not been recognized (Detail) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|---|
Defined Benefit Plan Disclosure [Line Items] | |||
Total | $ (5,855) | $ (5,905) | |
Foreign Plan | Pension Plan | United Kingdom | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Net actuarial loss | 7,138 | 7,123 | $ 2,281 |
Total | 7,138 | 7,123 | 2,281 |
Foreign Plan | Pension Plan | Switzerland | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Net actuarial loss | (1,283) | (1,218) | |
Total | $ (1,283) | $ (1,218) | $ 1,139 |
Assumptions Used in Determining Benefit Obligation (Detail) - Foreign Plan - Pension Plan |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
United Kingdom | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Discount rate | 2.50% | 2.70% |
Rate of compensation increase | 3.70% | 3.90% |
Switzerland | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Discount rate | 0.80% | 0.75% |
Rate of compensation increase | 2.00% | 2.00% |
Expected Long Term Rates of Return on Different Asset Classes (Detail) - Foreign Plan - Pension Plan - United Kingdom |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Defined Benefit Plan Disclosure [Line Items] | |||
Expected long-term return per annum | 2.10% | 3.00% | 2.70% |
Corporate Bonds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Expected long-term return per annum | 2.50% | ||
Gilts | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Expected long-term return per annum | 1.80% | ||
Cash | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Expected long-term return per annum | 2.50% |
Actual Plan Asset Allocation (Detail) - Foreign Plan - Pension Plan - United Kingdom |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Defined Benefit Plan Disclosure [Line Items] | ||
Actual plan asset allocations | 100.00% | 100.00% |
Corporate Bonds | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Actual plan asset allocations | 22.00% | 25.00% |
Gilts | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Actual plan asset allocations | 65.00% | 75.00% |
Cash | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Actual plan asset allocations | 13.00% | 0.00% |
Annual Benefit Payments (Detail) - Foreign Plan - Pension Plan $ in Thousands |
Dec. 31, 2017
USD ($)
|
---|---|
United Kingdom | |
Defined Benefit Plan Disclosure [Line Items] | |
2018 | $ 336 |
2019 | 312 |
2020 | 330 |
2021 | 405 |
2022 | 436 |
Years 2023 - 2027 | 3,297 |
Switzerland | |
Defined Benefit Plan Disclosure [Line Items] | |
2018 | 286 |
2019 | 224 |
2020 | 204 |
2021 | 201 |
2022 | 197 |
Years 2023 - 2027 | $ 878 |
Summary of Movement in Non-Vested Share Options (Detail) - Employee Stock Option - $ / shares |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Options Outstanding Number of Shares | |||
Beginning Balance (in shares) | 814,870 | ||
Granted (in shares) | 219,113 | ||
Vested (in shares) | (292,630) | ||
Forfeited (in shares) | (46,626) | ||
Ending Balance (in shares) | 694,727 | 814,870 | |
Weighted Average Exercise Price | |||
Beginning balance (usd per share) | $ 54.37 | ||
Granted (usd per share) | 85.98 | ||
Vested (usd per share) | 44.54 | ||
Forfeited (usd per share) | 60.73 | ||
Ending balance (usd per share) | 68.06 | $ 54.37 | |
Weighted Average Fair Value | |||
Beginning Balance (usd per share) | 16.55 | ||
Granted (usd per share) | 25.06 | 20.10 | $ 19.75 |
Vested (usd per share) | 14.39 | ||
Forfeited (usd per share) | 18.22 | ||
Ending Balance (usd per share) | $ 20.03 | $ 16.55 |
Schedule of Weighted Average Fair Values and Assumptions Used (Detail) - Employee Stock Option - $ / shares |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average fair value (usd per share) | $ 25.06 | $ 20.10 | $ 19.75 |
Assumptions: | |||
Expected volatility | 29.00% | 30.00% | 30.00% |
Dividend yield | 0.00% | 0.00% | 0.00% |
Risk-free interest rate | 1.93% | 1.39% | 1.58% |
Expected life | 5 years | 5 years | 5 years |
Schedule of Non-cash Stock Compensation Expense (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total compensation costs | $ 30,573 | $ 40,343 | $ 33,317 |
Direct costs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total compensation costs | 18,020 | 21,903 | 18,358 |
Selling, general and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total compensation costs | $ 12,553 | $ 18,440 | $ 14,959 |
Government Grants (Detail) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Deferred Revenue Disclosure [Abstract] | ||
Received | $ 3,539 | $ 3,539 |
Less accumulated amortization | (2,745) | (2,701) |
Foreign exchange translation adjustment | 207 | 103 |
Total government grants | 1,001 | 941 |
Less current portion | (35) | (54) |
Non-current government grants | $ 966 | $ 887 |
Government Grants - Additional Information (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Deferred Revenue Disclosure [Abstract] | |||
Amortization of government grants | $ 44 | $ 44 | $ (53) |
Restricted retained earnings | $ 1,200 |
Components of Income Before Provision for Income Taxes (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Schedule of Components of Income Before Income Tax Expense (Benefit) [Line Items] | |||
Income before provision for income taxes | $ 328,057 | $ 300,172 | $ 278,850 |
Ireland | |||
Schedule of Components of Income Before Income Tax Expense (Benefit) [Line Items] | |||
Income before provision for income taxes | 218,306 | 201,221 | 184,643 |
United States | |||
Schedule of Components of Income Before Income Tax Expense (Benefit) [Line Items] | |||
Income before provision for income taxes | 28,426 | 11,466 | 15,436 |
Other | |||
Schedule of Components of Income Before Income Tax Expense (Benefit) [Line Items] | |||
Income before provision for income taxes | $ 81,325 | $ 87,485 | $ 78,771 |
Consolidated Reported Provision for Income Taxes Differed from Statutory Rate (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Income Tax Disclosure [Abstract] | |||
Taxes at Irish statutory rate of 12.5% (2016:12.5%; 2015:12.5%) | $ 41,007 | $ 37,522 | $ 34,856 |
Foreign and other income taxed at higher rates | 6,324 | 4,642 | 4,614 |
Research & development tax incentives | (830) | (907) | (695) |
Movement in valuation allowance | 1,329 | 1,208 | (4,133) |
Effects of change in tax rates | 925 | 576 | (16) |
Increase/(decrease) in unrecognized tax benefits | 933 | (1,521) | 5,085 |
Impact of stock compensation | (9,917) | (4,121) | (3,468) |
Impact of mandatory repatriation under US Tax Reform | 7,694 | 0 | 0 |
Other | (896) | 594 | 3,068 |
Provision for income taxes | $ 46,569 | $ 37,993 | $ 39,311 |
Irish statutory rate | 12.50% | 12.50% | 12.50% |
Tax Effects of Temporary Differences That Gives Rise to Significant Portions of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|---|
Deferred tax liabilities: | |||
Property, plant and equipment | $ 1,139 | $ 979 | |
Goodwill | 22,655 | 26,617 | |
Other intangible assets | 11,801 | 6,700 | |
Other | 4,139 | 1,441 | |
Total deferred tax liabilities recognized | 39,734 | 35,737 | |
Deferred tax assets: | |||
Operating loss and tax credits carryforwards | 24,962 | 22,705 | |
Property, plant and equipment | 4,062 | 3,121 | |
Accrued expenses and payments on account | 24,433 | 28,904 | |
Stock compensation | 5,786 | 13,062 | |
Deferred compensation expense | 2,548 | 3,327 | |
Other | 740 | 15 | |
Total deferred tax assets | 62,531 | 71,134 | |
Valuation allowance for deferred tax assets | (22,439) | (20,337) | $ (17,200) |
Deferred tax assets recognized | 40,092 | 50,797 | |
Overall net deferred tax asset | $ 358 | $ 15,060 |
Reconciliation of Beginning and Ending Amount of Total Unrecognized Tax Benefits (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Unrecognized tax benefits at start of year | $ 26,620 | $ 28,166 | $ 23,201 |
Increase related to acquired tax positions | 0 | 0 | 778 |
Increase related to prior year tax positions | 0 | 1,151 | 1,482 |
Decrease related to prior year tax positions | (3,050) | (2,483) | (315) |
Increase related to current year tax positions | 4,765 | 1,104 | 3,063 |
Settlements | (2,523) | (837) | 0 |
Lapse of statute of limitations | (2,092) | (481) | (43) |
Unrecognized tax benefits at end of year | $ 23,720 | $ 26,620 | $ 28,166 |
Recognized Restructuring and Other Items, Net (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Restructuring and Related Activities [Abstract] | |||
Restructuring charges | $ 7,753 | $ 8,159 | $ 0 |
Net charge | $ 7,753 | $ 8,159 | $ 0 |
Provision for Doubtful Debts (Detail) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Allowance for Doubtful Accounts Receivable [Roll Forward] | ||
Opening provision | $ 9,450 | $ 10,383 |
Amounts used during the year | (2,733) | (3,782) |
Amounts provided during the year | 5,116 | 4,651 |
Amounts released during the year | (3,106) | (1,814) |
Foreign exchange | 203 | 12 |
Closing provision | $ 8,930 | $ 9,450 |
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Commitments and Contingencies Disclosure [Abstract] | |||
Non-cancelable operating leases for facilities expiration period | 10 years | ||
Operating leases rental expense | $ 44.0 | $ 44.0 | $ 49.9 |
Future Minimum Rental Commitments for Operating Leases (Detail) $ in Thousands |
Dec. 31, 2017
USD ($)
|
---|---|
Commitments and Contingencies Disclosure [Abstract] | |
2018 | $ 38,111 |
2019 | 32,575 |
2020 | 26,336 |
2021 | 19,079 |
2022 | 13,389 |
Thereafter | 36,692 |
Total | $ 166,182 |
Business Segment and Geographical Information Business Segment and Geographical Information Narrative (Details) |
12 Months Ended |
---|---|
Dec. 31, 2017
segment
| |
Segment Reporting [Abstract] | |
Number of Operating Segments | 1 |
Distribution of Net Revenue by Geographical Area (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Segment Reporting Information [Line Items] | |||
Net Revenue | $ 1,758,439 | $ 1,666,487 | $ 1,574,978 |
Ireland | |||
Segment Reporting Information [Line Items] | |||
Net Revenue | 424,292 | 410,572 | 429,631 |
Rest of Europe | |||
Segment Reporting Information [Line Items] | |||
Net Revenue | 337,105 | 313,185 | 330,487 |
U.S. | |||
Segment Reporting Information [Line Items] | |||
Net Revenue | 791,543 | 763,821 | 650,941 |
Other | |||
Segment Reporting Information [Line Items] | |||
Net Revenue | $ 205,499 | $ 178,909 | $ 163,919 |
Distribution of Income from operations, including Restructuring, by Geographical Area (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Segment Reporting Information [Line Items] | |||
Income from operations | $ 338,338 | $ 311,694 | $ 281,536 |
Ireland | |||
Segment Reporting Information [Line Items] | |||
Income from operations | 232,032 | 216,149 | 189,035 |
Rest of Europe | |||
Segment Reporting Information [Line Items] | |||
Income from operations | 26,493 | 34,200 | 38,166 |
United States | |||
Segment Reporting Information [Line Items] | |||
Income from operations | 58,322 | 41,348 | 45,320 |
Other | |||
Segment Reporting Information [Line Items] | |||
Income from operations | $ 21,491 | $ 19,997 | $ 9,015 |
Distribution of Income from operations, excluding Restructuring, by Geographical Area (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Segment Reporting Information [Line Items] | |||
Income from operations, excluding restructuring and other items | $ 346,091 | $ 319,853 | $ 281,536 |
Ireland | |||
Segment Reporting Information [Line Items] | |||
Income from operations, excluding restructuring and other items | 240,115 | 218,334 | 189,035 |
Rest of Europe | |||
Segment Reporting Information [Line Items] | |||
Income from operations, excluding restructuring and other items | 26,351 | 36,509 | 38,166 |
United States | |||
Segment Reporting Information [Line Items] | |||
Income from operations, excluding restructuring and other items | 58,164 | 44,590 | 45,320 |
Other | |||
Segment Reporting Information [Line Items] | |||
Income from operations, excluding restructuring and other items | $ 21,461 | $ 20,420 | $ 9,015 |
Distribution of Property, Plant and Equipment, Net, by Geographical Area (Detail) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | $ 163,051 | $ 148,967 |
Ireland | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 111,329 | 105,684 |
Rest of Europe | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 9,026 | 6,231 |
United States | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 27,797 | 29,428 |
Other | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | $ 14,899 | $ 7,624 |
Distribution of Depreciation and Amortization by Geographical Area (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | $ 61,297 | $ 59,575 | $ 57,677 |
Ireland | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | 26,277 | 25,766 | 22,100 |
Rest of Europe | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | 6,857 | 6,914 | 11,055 |
United States | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | 24,246 | 23,462 | 20,106 |
Other | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | $ 3,917 | $ 3,433 | $ 4,416 |
Distribution of Total Assets by Geographical Area (Detail) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Segment Reporting Information [Line Items] | ||
Assets | $ 2,146,618 | $ 1,825,843 |
Ireland | ||
Segment Reporting Information [Line Items] | ||
Assets | 880,378 | 766,120 |
Rest of Europe | ||
Segment Reporting Information [Line Items] | ||
Assets | 504,418 | 337,062 |
United States | ||
Segment Reporting Information [Line Items] | ||
Assets | 650,681 | 651,160 |
Other | ||
Segment Reporting Information [Line Items] | ||
Assets | $ 111,141 | $ 71,501 |
Distribution of Capital Expenditure by Geographical Area (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Segment Reporting Information [Line Items] | |||
Capital expenditures | $ 44,717 | $ 42,601 | $ 49,730 |
Ireland | |||
Segment Reporting Information [Line Items] | |||
Capital expenditures | 24,468 | 27,670 | 30,900 |
Rest of Europe | |||
Segment Reporting Information [Line Items] | |||
Capital expenditures | 2,819 | 2,851 | 1,916 |
United States | |||
Segment Reporting Information [Line Items] | |||
Capital expenditures | 11,027 | 8,432 | 15,256 |
Other | |||
Segment Reporting Information [Line Items] | |||
Capital expenditures | $ 6,403 | $ 3,648 | $ 1,658 |
Clients Representing Company's Net Revenue (Detail) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Customer Concentration Risk | Net Revenue | Client A | |||
Revenue, Major Customer [Line Items] | |||
Clients which represented 10% or more of the company's net revenue | 18.00% | 26.00% | 31.00% |
Distribution of Interest Income by Geographical Area (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Segment Reporting Information [Line Items] | |||
Interest income | $ 2,346 | $ 1,484 | $ 1,306 |
Ireland | |||
Segment Reporting Information [Line Items] | |||
Interest income | 1,084 | 407 | 102 |
Rest of Europe | |||
Segment Reporting Information [Line Items] | |||
Interest income | 1,222 | 1,040 | 1,151 |
United States | |||
Segment Reporting Information [Line Items] | |||
Interest income | 16 | 2 | 4 |
Other | |||
Segment Reporting Information [Line Items] | |||
Interest income | $ 24 | $ 35 | $ 49 |
Distribution of Income Tax Charge by Geographical Area (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Segment Reporting Information [Line Items] | |||
Income tax charge | $ 46,569 | $ 37,993 | $ 39,311 |
Ireland | |||
Segment Reporting Information [Line Items] | |||
Income tax charge | 20,345 | 24,215 | 21,795 |
Rest of Europe | |||
Segment Reporting Information [Line Items] | |||
Income tax charge | 1,921 | 5,528 | 8,007 |
United States | |||
Segment Reporting Information [Line Items] | |||
Income tax charge | 14,772 | 8,381 | 3,580 |
Other | |||
Segment Reporting Information [Line Items] | |||
Income tax charge | $ 9,531 | $ (131) | $ 5,929 |
Supplemental Disclosure of Cash Flow Information (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Supplemental Cash Flow Elements [Abstract] | |||
Cash paid for interest | $ 13,094 | $ 13,615 | $ 2,175 |
Cash paid for income taxes | $ 12,305 | $ 10,205 | $ 14,829 |
Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Currency translation adjustments | $ (36,188) | $ (70,154) |
Currency impact on long term funding (Net of tax) | (182) | (13,912) |
Actuarial loss on defined benefit pension plan (note 9) | (5,855) | (5,905) |
Unrealized capital loss – investments (note 3) | (295) | (23) |
Total | (38,713) | (86,300) |
Interest Rate Contract [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Hedges | 4,658 | 4,658 |
Amortization of interest rate hedge | (1,887) | (964) |
Foreign Exchange Forward [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Hedges | $ 1,036 | $ 0 |
Long-Term Debt - Senior Notes - Additional Information (Detail) - USD ($) $ in Thousands |
1 Months Ended | 3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Nov. 30, 2015 |
Dec. 31, 2017 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Debt Instrument [Line Items] | |||||
Long term debt | $ 348,888 | $ 348,888 | $ 348,511 | ||
Cash proceeds from interest rate hedge | $ 0 | $ 0 | $ 4,658 | ||
Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Long term debt | $ 350,000 | ||||
Stated interest rate | 3.64% | 3.64% | |||
Debt instrument, term | 5 years | 5 years | |||
Interest rate hedge, inception date | Oct. 05, 2015 | ||||
Cash proceeds from interest rate hedge | $ 4,600 | $ 4,600 |
Impact of New Accounting Pronouncements Impact of New Accounting Pronouncements (Details) - USD ($) $ in Thousands |
Jan. 01, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|---|
Cumulative effect adjustment from adoption of ASU | $ 6,677 | ||
Retained Earnings | |||
Cumulative effect adjustment from adoption of ASU | $ 6,677 | ||
Accounting Standards Update 2016-09 | Retained Earnings | |||
Cumulative effect adjustment from adoption of ASU | $ 6,700 | ||
Subsequent Event | Minimum | Accounting Standards Update 2014-09 | Retained Earnings | |||
Cumulative effect adjustment from adoption of ASU | $ 40,000 | ||
Subsequent Event | Maximum | Accounting Standards Update 2014-09 | Retained Earnings | |||
Cumulative effect adjustment from adoption of ASU | $ 80,000 |
Related Parties - Additional Information (Detail) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Dec. 31, 2017
USD ($)
|
Dec. 31, 2017
EUR (€)
|
Dec. 31, 2016
USD ($)
|
Nov. 01, 2017
USD ($)
|
|
Subsidiaries | DS Biopharma Limited | ||||
Related Party Transaction [Line Items] | ||||
Revenue earned from related parties | $ 743 | $ 100 | ||
Amounts due from related parties | 220 | |||
Mr. Thomas Lynch | ||||
Related Party Transaction [Line Items] | ||||
Related party transaction amounts | € | € 231,750 | |||
Amounts due to related parties | 64 | |||
Mr. Ciaran Murray | ||||
Related Party Transaction [Line Items] | ||||
Expenses incurred from related Party | $ 178 | |||
Fair value of asset transferred to related party | $ 77 |
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