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Contacts:
Darcie Peck
Investor Relations
(203) 845-5237
dpeck@imshealth.com
Gary Gatyas
Communications
(610) 834-4596
ggatyas@us.imshealth.com
NORWALK, CT, July 21, 2008 – IMS Health (NYSE: RX), the world’s leading provider of market intelligence to the pharmaceutical and healthcare industries, today announced second-quarter 2008 revenue of $600.7 million, up 12 percent or 4 percent on a constant- dollar basis, compared with revenue of $537.5 million for the second quarter of 2007. Operating income in the second quarter of 2008 was $131.4 million, up 11 percent or 1 percent constant dollar, compared with $118.1 million in the year-earlier period.
“Led by 26 percent growth in our Consulting and Services business and accelerating results in the emerging markets, IMS delivered a very solid quarter,” said David R. Carlucci, IMS chairman and chief executive officer. “In this dynamic healthcare environment, demand remains strong for our offerings designed to help clients improve their commercial productivity. In addition, our continued focus on cost and expense management contributed to an improved operating income and cash flow performance.”
Second-quarter 2008 diluted earnings per share on a GAAP basis was $0.42, compared with $0.36 in the prior-year quarter, an increase of 17 percent. When adjusted for the phasing of foreign exchange hedge gains and losses, and the phasing of tax benefits in the second quarter of 2007, earnings per share on a non-GAAP basis for this year’s second quarter would have grown $0.01 year over year, to $0.40 (See Note c to the financial tables).
Net income on a GAAP basis was $77.7 million, compared with $73.4 million in the year-earlier quarter, an increase of 6 percent. When adjusted for the phasing of foreign exchange hedge gains and losses, and the phasing of tax benefits in the second quarter of 2007, net income on a non-GAAP basis for the 2008 second quarter would have been $73.5 million, compared with $78.8 million in the year-earlier quarter (See Note c to the financial tables).
First-Half 2008 Results
For the first half of 2008, revenues were $1,174.9 million, up 12 percent or 5 percent constant dollar, compared with revenue of $1,047.8 million for the first half of 2007. First-half 2008 operating income was $247.8 million, up 8 percent on a reported basis and down 1 percent constant dollar, compared with $229.2 million in the year-earlier period.
For the first six months of 2008, diluted earnings per share on a GAAP basis was $0.74, compared with $0.79 in the prior-year period. When adjusted for the phasing of foreign exchange hedge gains and losses, and the phasing of tax benefits in the second quarter of 2007, earnings per share for the 2008 first half on a non-GAAP basis would have grown $0.03 year over year to $0.77 (See Note c to the financial tables).
Net income on a GAAP basis was $136.9 million, compared with $159.0 million in the first half of 2007. When adjusted for the phasing of foreign exchange hedge gains and losses, and the phasing of tax benefits in the second quarter of 2007, net income for the first six months of 2008 on a non-GAAP basis would have been $141.6 million, compared with $149.3 million for the first half of 2007 (See Note c to the financial tables).
Balance Sheet Highlights
IMS’s cash and cash equivalents as of June 30, 2008 totaled $220.7 million, compared with $218.2 million on December 31, 2007. Total debt as of June 30, 2008 was $1,472.9 million, up from $1,203.2 million at the end of 2007 and down from $1,567.3 million on March 31, 2008.
Share Repurchase Program, Shares Outstanding
No shares were repurchased during the second quarter. Year-to-date, 10 million shares were repurchased at an average share price of $22.93, for a total cost of $229.3 million. Ten million shares remain authorized and available for repurchase under the December 2007 Board of Directors’ authorization.
The number of shares outstanding as of June 30, 2008 was approximately 181.9 million, compared with 195.0 million as of June 30, 2007.
About IMS
Operating in more than 100 countries, IMS Health is the world’s leading provider of market intelligence to the pharmaceutical and healthcare industries. With $2.2 billion in 2007 revenue and more than 50 years of industry experience, IMS offers leading-edge market intelligence products and services that are integral to clients’ day-to-day operations, including portfolio optimization capabilities; launch and brand management solutions; sales force effectiveness innovations; managed markets and consumer health offerings; and consulting and services solutions that improve ROI and the delivery of quality healthcare worldwide. Additional information is available at http://www.imshealth.com.
Conference Call and Webcast Details
IMS will host a conference call at 8:00 a.m. Eastern Time today to discuss its second-quarter results. To participate, please dial 1 (800) 734-8507 (U.S. and Canada) or 1 (212) 231-2902 (outside the U.S. and Canada) approximately 15 minutes before the scheduled start of the call. The conference call also will be accessible live on the Investor Relations section of the IMS Website at www.imshealth.com. Prior to the conference call, a copy of this press release and any other financial or statistical information presented during the call will be made available in the “Investors” area of IMS’s Website.
A replay of the conference call will be available online on the “Investors” section of the IMS Website and via telephone by dialing 1 (800) 633-8284 (U.S. and Canada) or 1 (402) 977-9140 (outside the U.S. and Canada), and entering access code 21388099 beginning at 10:00 a.m. Eastern Time today.
Second-Quarter 2008 Earnings Tables (pdf)
Forward-Looking Statements
This press release includes statements that may constitute forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Although IMS Health believes the expectations contained in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove correct. This information may involve risks and uncertainties that could cause actual results of IMS Health to differ materially from the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to (i) the risks associated with operating on a global basis, including fluctuations in the value of foreign currencies relative to the U.S. dollar, and the ability to successfully hedge such risks, (ii) regulatory, legislative and enforcement initiatives, particularly in the areas of data access and utilization and tax, (iii) to the extent unforeseen cash needs arise, the ability to obtain financing on favorable terms, (iv) to the extent IMS Health seeks growth through acquisitions and joint ventures, the ability to identify, consummate and integrate acquisitions and joint ventures on satisfactory terms, (v) the ability to develop new or advanced technologies and systems for its businesses on time and on a cost-effective basis, and (vi) deterioration in economic conditions, particularly in the pharmaceutical, healthcare or other industries in which IMS Health’s customers operate. Additional information on factors that may affect the business and financial results of the company can be found in the filings of the company made from time to time with the Securities and Exchange Commission.
