- Earnings call transcript Q3 2022

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Operator

Ladies and gentlemen, thank you for standing by. At this time, I would like to welcome everyone to the IQVIA Third Quarter 2022 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. [Operator instructions] As a reminder, this call is being recorded. you. Thank to Investor over Relations like Senior Nick the President, Vice and turn now to call Childs, I’d Treasurer. Mr. Childs, you conference. may begin your

Nick Childs

Perrone, and Good Planning and Vice will Director, General Senior has for and Chief Chief you President our ir.iqvia.com. IQVIA Thank Brian during and Senior available our Officer; Ron XXXX Relations and me Investor succeeded morning, website be this Officer; Relations and Vice our President, referencing Gustavo Investor call Executive are Vice you. also on President following Executive today [ph]. Chairman quarter who Events With be earnings Presentations will Fedock, call webcast. section Eric a Today will the for Bousbib, Counsel; at This those Ari this Financial Analysis; Mike be Bruehlman, third Financial call. of we of Thank joining you everyone. presentation presentation Sherbet, that visible Executive in

risks with business, are with and would subsequent the I in could uncertainties due which our differ listeners filings conference and Exchange the the on company’s or company’s forward-looking results Commission, Actual begin, and management that statements. Form call from will XX-K we those this forward-looking by discussed like statements implied materially stated during discussed Before Securities including information to include report associated annual certain caution SEC by to filings.

presentation. the would release is to Ari reconciliation measures substitute Chairman call measures financial and and of A now non-GAAP comparable like to these discuss conference financial will non-GAAP to call, supplement accordance the and we turn included addition, In in with measures a for in this be measures a the which Bousbib. certain CEO, our on should over to prepared press not I GAAP. call considered GAAP

Ari Bousbib

geopolitical results for our delivered despite third quarter of Thank today quarter good financial Thank joining everyone. challenges strong another slowing broader and about you Nick, demand, you IQVIA various results. and macroeconomic us issues. global market morning, concerns to discuss the

indicators fact, generally concern highest remain healthy. year, from this which of beginning the one of of of X% and year the our quarter X% in funding, trend is molecules In quarter, year. EBP starts are quarter in pre-COVID. annual smaller when and ahead to World, the exceeds about lingering funding according five of to raised demand stage customers a since in any last early the late fact, active funding from Year date, average which both pipeline at the rate, competitors pre-pandemic The last stage Industry billion, year-to-date. $XX.X trials to of $XX continue rising levels. alarms. both has clinical third the funding XXXX up been almost market Bio of years improved the was billion a EBP running

Our on mid-teens own flow segments RFP QX are year-to-date both double and a EBP in pharma basis. in large digits up flow and RFP grew the

year. throughs Our and throughs, strong versus And grew from impact from our half excluding backlog on as X.XX results exchange. first pass book-to-bill X.X% excluding the the foreign our result, basis continuing X.XX reported saw, the pass of year was QX a you a as and prior including X.X%

areas. serve we than XXX not demand. are that can including experiencing more diversified. a of in XX,XXX therapeutic As helps also extremely of large XX clients are across you over tell, we the all in countries, top we signs slowdown It spectrum customers pharma any Remember,

global investigator challenges as sites. remains very development, of ongoing caused and you newer know, perhaps been environment throughout some and have are that demand healthy, by at including lockdowns going with have still as saying disruptions, macro levels the dealing been we high while Russia-Ukraine the we that's obviously operational certain Now, the China a inflation, wage on attrition, staff reoccurring shortages year,

know, been issues the first in results to reflected year. as nine for have months our As all we these overcome able you of the

Although our stretch minor the in the some In are of as in M&A sharply. allocation result pay This as capital levels by have the in are as of share and bottlenecks and include the year, demand in caused caused execution industry through we the we're end a delaying and on by strategy in of our strong macro-disruptions factors high adjusting capital sites A to specifically remained persistent deliveries and created by in to that are why we repurchase to the staff discussed. down, inflation. of we location response, guidance debt delays deliveries. our little at I tweak the of this year. we underlying our decided timing is anticipating that notes the and by past. just some been increasing opportunistically end the In are the managing the final a Interest rates strategy, the businesses addition certain to the headwinds summary, shortages

operational for more constant XX%. currency. grew R&DS Notably the last million beat continued our and year the guidance in $XX businesses our work let's at TAS meat detail. quarter from The range both Now, up third and and both X% the and on TAS point exchange constant base basis quarter review of XX.X% up was an headwinds. the on periods, a third R&DS was business driven on by at XX% was grew to Revenue upside organic in reported XX% above same services, excluding currency offset basis by foreign Compared the COVID-related basis.

quarter ongoing headwinds revenue persisting business. our the inflation wage and in cost reflecting of Third growth strong that offsetting XX.X%, discipline, are our EBITDA management adjusted increased

of $X.XX XX.X% grew growth. Third our by diluted adjusted EPS EBITDA quarter adjusted driven

programs capabilities technology data usable the top complexity pharma countries the provide In and information been requires tremendous and by me large increase centralizing and side. business, selected data XX this with Let and science management industry we've across opportunities XX and capabilities large the for The created cloud you care call, decades. starting human some specialty portfolio. power exponential scale as inside generation. IQVIA, clients and primary access medicine evidence the robust harmonizing know, analytics When to making in IQVIA's for their color commercial has data new on for data building data at these and

consumer. purpose single for We campaigns changing developed continue platform. IQVIA a fast open to healthcare advance omnichannel manner healthcare. the a from We're deploying acquired of to information that and healthcare coordinate meet Lasso the marketers to digital ecosystem digital Marketing, in marketing personalized built an system that's execute quarter, a in delivers the privacy-first and operating healthcare which In needs timely

market interest. DMD are will a oncology we their brands and selected top addition, you recently Marketing relevant which to insights acquired Solutions, by client a technology In digital using about to commercial biological solutions bring HCPs practices was personalized our to to recall, year pharma that brand Demand deliver to and X XX strong. for content ago, remained

This and selected clients IQVIA's gain more orchestrated precision than IQVIA ecosystem real-world continues its coverage commercial quarter, in combine multiple customer to speed a transform driving in XX the data an the business, commercial to pharma the and analytics boosting efficiency study commercial management in capabilities. In XX% management IQVIA suite, will design lead of innovative process. orchestrated AI-enabled master countries, their older that into IQVIA's XX top customer model. operations suite deploy customer engagement technology IQVIA's The and

For awarded portfolio studies midsized example, company. from in real-world of we in the quarter, a were multiyear pharma psychiatry a

with patients tech, our the are early the capabilities. We a translational for major company and a lines combines real-world and burden comprehensive both med awarded on recruitment contract time markers identify infrastructure site. study to rejection combining the to example, non-interventional faster were another reduce organ data-driven with transplant we tech home a to significant med health that a In sciences

Moving RDS. to

privacy Our which is a first as highly Regulation, trial, General achievement any independent from recognized received for validation. DCT is the compliance this independent the is Trust program key European deal. data GDPR in it decentralized separate has program, clinical This it This validation. GDPR, requires in is leader big IQVIA Protection validation Arc, offering from EU It's a as Data audits. DCT the received time industry X has

book-to-bill expanded of clinical clinical now in panel grade with provide This our expanding can our exceeding business the first Participants own lab R&DS investigator leader continues an time over trials addition, delivered home clinical DCT by X.XX comfort capabilities safety the into U.S. seen, a quarterly self-collection now pass-throughs. participants blood the And $X visit Inc., solutions. as of in the ratio ratio translated them, Tasso in to strong total services capabilities. collection you've pass-throughs, collaboration DCT offerings first with quarter in professional health with In their business the blood the without in for ever. of bookings a quarter billion need have its trial business we've net of the care excluding overall including specimen a launching And a a X.XX. momentum lab testing the for course, visit billion of or book-to-bill new in for and $X.X site

our our contracted for last details was ratio to now financial X.XX, the including pass-throughs, X.XX, and Ron book-to-bill over on pass-throughs. will Over XX months, more it turn excluding performance. I

Ron Bruehlman

Okay. everyone. and Thanks, Ari, good morning,

Let's start reviewing revenue. by

base third down XX.X% excluding $X.XXX COVID-related Analytics from the last, of up versus XX.X% business, XX%. Solutions the work all growth for basis revenue $X.X was XXXX. about at revenues were grew In reported was Technology constant reported billion, organic In a X% revenue quarter, and is that COVID-related currency of quarter currency. & quarter million billion quarter our and year constant million, this Third both $XXX at X.X% the constant at currency. third on and approximately $XXX

work, was third COVID-related currency at quarter Solutions constant at of TAS in revenue R&D $X.XXX reported X.X% currency. was all constant billion Excluding organic XX.X% XX%. up and growth

constant Ari work, all R&DS currency was COVID-related at mentioned. XX%, organic Excluding growth in as

basis growth $X.XXX of on X.X% work, that revenue year-to-date. CSMS Finally, constant but revenue all at COVID-related Year-to-date constant Technology currency. billion, Contract CSMS Analytics organic growth about and organic Medical excluding base billion & grew X.X% at reported in and revenue all up X% currency year-to-date reported revenues $XXX constant grew XX.X% X.X% our business, was excluding were at XX%. declined COVID-related Solutions or is constant million reported a currency. third was quarter currency. COVID-related work, was And & currency In at $X.XXX Solutions at constant was X%. million Sales X% $XXX

COVID-related of all growth Solutions in actual constant at work, was currency. $X.XXX work, up organic R&D excluding currency was Solutions and was rates growth Excluding X.X% year-to-date year-to-date. constant Analytics FX billion XX% all at XX%. Tech COVID-related constant R&DS at at & in organic X.X% currency But revenue

revenue or Sales million of at constant X.X% grew Medical and $XXX Contract reported Solutions Finally, CSMS X.X% & currency. year-to-date declined

organic X%. COVID-related was in growth all CSMS currency Excluding work, at constant

third the million for move representing XX.X% year-over-year. let's million EBITDA quarter, Now the was P&L. was Adjusted EBITDA adjusted up $X,XXX year-to-date growth down XX.X% of $XXX while

GAAP Third adjusted diluted grew quarter quarter per $X.XX. and was net share $X.XX year-to-date million million per diluted $XXX per income million GAAP earnings share. the $XXX to and and share for earnings million net per Adjusted income $XXX income or diluted adjusted $X.XX or net share. of net $X.XX was GAAP was earnings XX.X% was income third Year-to-date was $X,XXX

bookings. Now of quarter it's reviewed, already R&D solutions another outstanding delivered

Our backlog at foreign increase impact record X.X% X.X% adjusting exchange. XX basis an a of at September reported a for year-over-year $XX.X stood the and on billion, of

point year-over-year foreign million out of exchange, would might the be that higher. I fact, impact without $XXX In backlog

of X.X% X.X% adjusting month and XX reported billion, exchange. $X.X for to foreign growing a increased revenue backlog year-over-year Next basis impact from the on

now balance $XX,XXX debt resulting and as was Okay, million totalled $XX,XXX September net of gross $X,XXX in reviewing and equivalence of million cash million. cash debt XX, the sheet,

adjusted the leverage month of Our end net was XX the quarter EBITDA. times at X.XX ratio trailing

operations $XXX million cash from $XXX quarter million free result cash $XXX a in for was million CapEx the Third resulting flow flow was strong of and quarter.

our the current that $X.X just It's year-to-date remaining of this program. shares, XXX in repurchased under quarter our under puts leaves saw share billion above slightly we us share the with billion $X.X repurchase. of and million You authorization which repurchase

variable our retired scheduled mature we adjusting our in rates. loans October, you XXXX, early cash strategy to light balance Now, million and interest we're of US of the as higher term of in it dollar rate Earlier discussed so this already in sheet. in this $XXX end September was earlier, month, don't deployment was see

the and pursue We as will repurchase continue additional we term likely XXXX during since shares, while practice our been acquisitions retire to has merger. debt

Now guidance. let's to now turn

last grow November, second quarter headwind to million further since full currency release. to year the dollar the guidance over XXXX, initial For organically revenue work a we includes teens. low-to-mid $XXX continue full reported and the million expect our since our earnings year On basis COVID-related strengthening in a constant at of this has of excluding the impact caused US $XXX

to staff mentioned, conflict visits, wage already as and unresolved able than and the China residual the modest offset our been persisting a inflation, forecasting environment the in in balance shortages, pockets challenges we updated and as them are challenges lockdowns our absorb such of we're and business we've still during all these values. far, addition, so the this patient investigator impact slower global in but numbers, expected of macro continued of reflected recovery in In Russia-Ukraine year,

global by for macro million the guidance, detailed. impact a adjustment midpoint exchange full roughly driven and with be foreign the we represents and $XXX year, of environment to million So the this dollars expect $XX,XXX rest revenue our just I $XX,XXX two-thirds At now of million. the this headwinds an between of by about

year-over-year X.X% this represents low-to-mid growth basis. as at related a a equates on guidance growth X% COVID reported X.X% to work. currency X.X% teens at the constant to currency constant excluding reminder, and updated And organic Our

mention. Our we raising now are represents basis $XX.XX, to and EBITDA growth lastly, reflect the EBITDA range $XX.XX XXX XX%. be year-over-year the guidance end of EBITDA diluted and to now includes to and be from adjusted below reflect And setting which we're XX.X% between contribution -- on be to wins expecting line. by cost We're of the revenue costs $X,XXX the growth guidance We're represents expect estimates guidance updating of EPS adjusted between the projected revenue $X,XXX million of range adjusted between our points growth to to million, approximately adjusted year-over-year our which now EPS also to updated of XX.X%. We XX.X% guidance $X.XX midpoint M&A.

reported currency we of our revenue X.X% or and be expect constant to fourth to X.X% million on basis, on growth guidance, a X.X% X.X% and Moving basis. between a $X,XXX to to quarter $X,XXX million

XX% Excluding fourth to revenue expected to we growing at the be and Adjusted at That's up work, is finally, of be million. expected all is adjusted organic EPS XX.X%. X.X% over COVID-related midpoint and million X.X% expect constant diluted $X.XX between $XXX our currency and guidance. to growth EBITDA between to to be quarter $X.XX $XXX XX.X%

rates Now, as of XX year. all guidance assumes our the for currency October that of of balance foreign the continue

very industry organically operational in we our at healthy. excluding So free before demand Revenue and Q&A, in cash to and summarize quarter. business delivered to go We constant the performance the the underlying work. mid-teens COVID currency strong remained P&L grew flow related

operator in variable fourth first month shares start nearly session. backlog our to Our its we the the RDS our quarter term business continues debt. reducing adjust net strong for the me finally, to $XX.X hand momentum of while that, of excluding trailing with Q&A to of it X.X billion and ratio new exceeding of XX EBITDA ever. approximately With retired leverage Contracted times foreign X%, at over our We up the over $XXX $XXX beginning impact let sits million quarter, the a the bookings the of exchange. repurchase billion time services at $X record million

Operator

from [Operator Windley Dave instructions] Your the question first line with comes Jefferies. of

Dave Windley

to Hi, accelerator throughput I that the call about side. my good morning. speed of taking decelerator the of question. it on speed focus on in both RDS. of Thanks buckets side for I studies kind fall could and major and thinking wanted

shortages remote finding throughput to spur things more studies. capabilities, to patients post-COVID talked your these of about up along DCT activity might that COVID. in backlog around were therapeutic in you've side, hard catch And something So that willing be recruitment Maybe, the or That's staff participate industry. pushing kind of that, for your trend on things things a that's in are clients maybe the sites at during mix patients, you that are like lengthening. highlighted pushed could then that that behind other

So us kind which revenue of you quickly and how backlog could just I into convert help tug like, seems war and these you one's your to if of relevant or the winning? there can Ari, wondered, understand factors

Ari Bousbib

David. the in question Well itself. built and elements your are for many response question Thank good morning, there you of

a very to field, industry have and Look happening all in visits the clearly what's fully as not You you the well. know recovered patient know levels. as context pre-pandemic

one. number point that's So

an I conference was industry at it presented recently. think

think operations shortages Summit, Research issue staff I Clinical for investor on Society a Sites was this flagged was industry-wide. it side development that affecting X of October are as

So that, if you will, is on the negative now.

point to as the is correct the to a issue. obviously to to less You're better DCT site, the -- has actually visit counter require this the it we patient

Now this we talking the year, ongoing a as levels and beginning back or been is dealing attrition, very with, the about don't high to going happens of time have be that see which have It work. a to thing. of we've hard we sort issue what been permanent from of people

we've the all have impact all that a significant in of recruiting require the seen. operational plus skill -- we've and of sets combination programs. of challenge harder And has, cost mentioned as initiatives on We that productivity the many or impact single been a we our times, with the with that are we issues have these time offsetting cost-reduction and labor of these factors dealing most that important

incoming these also the have to Now shortages. to with factors. The trials. the flow they only dealing same sites have prioritize staff as not And a experience versus when we're dealing of result ones shortages of clinical with staff patients the

so that's a And development.

I acute. I just that of correct. complexity just be studies -- mix the it the the new also in There more makes factors of You evolution makes backlog, to think mentioned the factors. mentioned, studies also the mix, I And market, industry-wide think our happens is -- the not as of this even is it's

The study. the of is more is of to difficulty As correlated recruitment complexity recruit you -- the much patient know, is correlated. patients with

we've and can we because our our times better had are where is than data have we and patients shine an able technology, would we've and this proven many address studies area Now to analytics got recruit that complex otherwise. we

it's able I So of our own because to address we've which we've been our to through to all side to able quarter year, those. going hard and it. so tell. every win, beat been been I you've expectations, able mean, far, the But we address have is to seen numbers look, mean that's

size, been not. We the a We're tweaked Had or win have sensitive numbers your to are we able loss. we one a single We're study of a a be everything X/XX diversified, investors. study want the big just and company, question, put to not out just We anticipate we to because dependent would we very big on quarter little be transparent large-scale sure adjust. study. this highly bit fourth Thank Dave. to for here and make we you and

Operator

question next Sourbeer from the of UBS. Your comes John with line

John Sourbeer

you I the also if just little trends. hiring inflation was some you remarks. on could attrition mentioned wondering the more And a talk bit and in prepared

guiding some looking? trends these guess, on Just into -- how pressures how there? on but this And I on is I any And the pricing? pricing offset easing other out next pricing the do XXXX, you know playing are these you see do able then side, year? on see you're to not of you inflationary

Ari Bousbib

talking recruiting, studies. mean, the the compensating cost XX% we exactly of of a the talent, operational very and reached in question. are John, of the our challenge and again, single the training, saying most I you, talent. highs. here. to first is equation We've year. record dealing year. the there's sometime execute That talent, about levels attrition been you're Thank with no throughout with. this the a need almost retaining about news talking that dealing And part is we're this we significant The talent good been talent, And is We've that operational

levels seen stabilized. down of have and We attrition those come

a very Now us put stabilized the to burden XX%, we I mentioned measures not come sales at is of include they're continue and adjustments, include, we the of that they we upward just inflation creating deal we which more And number create issue again, more talked there. -- partner only more the Obviously, but high. industry-wide It's and to which to And as with. that XX% bottlenecks places execute. where in the very down. is, about we hope is that large are execute -- This still in including type to those going now retain sites people. studies, and for the before, and range have place compensation compensation they to our

and as attrition So don't as far issues last. our we know how long operations, headwinds turnover this will employee and

can we of wage this and and and that you have with launch potential 'XX, dealing of are decided anticipation We of we're of fourth XXXX some these to planning programs were accelerate of inflation them. employee tell of in we to that productivity cost-cutting in the quarter in initiative issues. many turnover starting many continuation them I

to So that far we our as are operations. going address as

you pricing. asked is the how which we balancing question, to on reflect are able Now that

As CRO the business. long-cycle know, side it's on a you of the house,

is than the escalation X% that are, in I most cost inflation. to don't So that year years, that cost at facing. backlog us years, or anticipated X But think assumptions, in There a certain ago, we rates. was different the that's were and adjust anyone sometimes, still X%, contracts, contracted a X X the which backlog provisions are enable clauses years our contracted ones

suffering cost a not lag there and headwind is reflect So -- if between when able when we we're into is pricing. to a immediately our are delay, that will, we fully can there you the

But Now we also it's long-term on a side. little less commercial businesses like there cycle the contracts. the that shorter have in

have got X licenses year, at at data We've certain least We We've contracts rates. at certain got contracts. technology X-year rates.

contracts and able in are business. again, So the it not price X bulk of -- to year to were we are that is those able the analytics, it's reflect X services, increases in more in but consulting, months, X, visibility-type which likely

so, for there got So to but question. Thank you, is plans lag. we've John, it a will happen, do your and

Operator

Draper comes Your with next Sandy from Guggenheim. question

Sandy Draper

at you commentary some X Thanks and to TAS. very much. I TAS helpful buckets guess, the look on side be hear broad thinking the about Ari, it'd

terms thinking happening force? like of some are terms what's data sales looking weakening? are of is there with -- In feel going marketing potentially around out how the and drivers about you do there Just marketing. staying the budgets thinking of Has stabilized, in the there, using cuts? or that be improving, okay, what at accelerating about to commentary demand overall Is that same, people concerns the

some Just the see you takes about terms on puts year? we how into cons and next as commentary pros what's going would love and in TAS side on of head and

Ari Bousbib

Yes. question. very Well, Sandy, and for thank the TAS. Look, we in are with seeing strong continued you pleased the growth that are we

both You That's And constant the if revenue strong. the tech and heard strong buckets of continue and us, to know from Ron includes world COVID business report real commercial of they and and years growth. the think be really in about excluding currency bucket high-growth three drivers growth, organic myself, both really, -- we XX%. you that

our We I more innovative to my to of introductory deploy evidence real-world utilize continue to solutions. find and ways care we described for technology remarks, clients, as in

digital talked marketing. You about

forces, down. sales a reps that as general, true going it's in So are sales demographic

parts business between long-term trends. that And of and those clearly sales physicians, downward physical a interactions have so are businesses any any reps reliant on

on So people are experience dependent going are who to for CRM, example, headwinds.

DMD going. I decide I feel with system towards mentioned is interactions. our share We support this And examples, an of We content. that enable companies now unique, enables clients past made we here buy have this in operating And Lasso us market. forefront to of are unique last HCPs We we ago made promotional Interactions year. kind in long evolving to the some bought and is quarter. These this that This to that bought place Marketing claim and been pharma many industry technology as before, are the digital remarks, will in area. we of We've transition. bought my mentioned to Now times where and introductory are digital clients transition this fair have marketing. at are where the we rapidly to our is investments. investments

slow It's marketing, is mode but Sandy. more correct. what and going in market Thank a that's downward, to away. So by you're it growing traditional the and business. investing been absolutely trend of our that's than Overall, you, growth what's but downwards, digital offset in in, we've it going is is

Operator

Your line Stifel. next question Rosenbaum of comes from with Shlomo the

Shlomo Rosenbaum

This for one Ron. is actually

should can rate in the bit should assume be more kind mid-Xs, interest focus like how Given on how basis? debt? on of as color this interest to we your the an rise give debt, ratio a of are of you thinking thinking of a and retiring of rates leverage we little us just low-Xs, blended instead And ongoing targeting you should more that be the about we

Ron Bruehlman

deal it's to our Thanks topical enough these rate strategies And are to the very given at color question, this with provided for addition interest Shlomo. an you give Yes. to it. what point. P&L And want guidance issue. environment for a in the XXXX little days. haven't we comprehensive it's I But important of bit that around

Let's strategies. the with start

down with we paid go we looking in year. as near down -- $XXX and that to loan maturity next early loan be expensive, some that debt in coming fourth we'll in that a debt the saw XXXX term and You was comparatively term in pay additional quarter through term million to

see So talking about us you'll that.

leverage that way was As to It close at we'll or -- through go the ratio, as as target for X.X we QX. our gradually trending have far that XXXX. year, downward. that been X any that end set I get hit we that's as of would we exited next expect we

next and think by the we're to level of later year. that possibly end to get than down going rather sooner I

not of expense look, interest as the we're far forecasting as business Now rates. goes, in

if where with has And a million kind for precisely but year. kind of can look just the step-up the rates, further say help. increases exiting from forecasting outward give go QX, about what it's give actually, you exiting have interest quarter, go are then in an number to a higher. -- very the and annual interest So substantial is or fairly some see think rate year expense be be that rates increases, we it's at depends rate $XXX that from rates take. been. to quarter, going you major will And the end million, on And was that think at first you into is And $XXX it you see extend which as we run If you then the be we if about we that's math market of where modest out, there project will $XXX quarter. what consensus is per in could to the don't is expense market that, happen projecting, we'll of million the the

off end also a of QX. We the have at swap rolling

actions, So expense maybe on We'll higher $XXX this It depends million. of you central But with get to cash depends things. on keep use But that year for approaching interest getting how lot so we could know than in rate some this next you year our been see should your models. next see. that. flow anyway our I forth. the mind you $XXX have to and cash flow, choose struggling people have a in million, ballpark

than right? point said little be the in interest wanted in each like past on count $XX of drive, I for we bit more to we been had a X.XX explicit So when million

Ari Bousbib

Yes.

that as we've So working debt retire time mean, that's 'XX. it some been And to we that decided I item in the was the on. of Ron that mentioned, matures

retire going maturing a So just in we of couple took out X weeks in ago. And XX to is a 'XX. weeks we're what ago, probably few

retire in 'XX. will that We

begin will interest the we of addressing issue And so expense.

either a us are it's step-up X-year standpoint, likely right? From comparison have But interest on, will in or going from expense we in in issue rates to a then hopefully, for a aggregate stabilize decrease. 'XX 'XX. versus course, Of

got Fed, map. the the really with governor's they representing and each you've at rates the anticipation all charts over of individual look and these every are of dots you governance by If forecast the

For XXXX, to ranging from X%. X.X%

So to point, then go other we're it certainly, we address, at to becomes going hopefully, rates mitigate take address to some have will headwind the on actions planning impact. be tailwind, down fronts that to speak. a But so that 'XX, to and a and it other will and

Operator

line comes Deutsche question from of next Bowers Your the with Bank. Justin

Justin Bowers

as some obviously with comments And in then or around wanted in your Area follow -- up some some turnover and -- seeing clients of Just changes the to the well. labor. Bay we're on

in a sense an in those other wanted any And hire I geographies? seeing specific provide turnover some that or either pressures TAS in opportunity So inflation? the pockets or of on you're labor if light that notably the conversion to to goal next to isolated way areas the talent, at we're be us of site some of be would of issues if then backlog to combat some are labor what some XX sites, is you're pulse you the what level? and a provide get And seeing the just of at the follow-up the the months seeing over the there with would

Ari Bousbib

of question. TAS. for competition one. That's backdrop, component the Look, that post-COVID to much strength context given you number That's for very Thank in the Yes. inflation addition additional an your wage the overall of obviously there's inflation. industry drives resignations the of and

staggering, to the are on incremental we've people, thousands I order issue of of that bring recruiting we hiring, people the numbers Now earlier. attrition actively this we mentioned had I demand. number course, And of the meet board in are mean, and

We XX,XXX thousands year. of approximately thousands employees. a said, have recruit, I We as and employees

we capabilities do focused have are it. we So on the

front-line Obviously, its leadership. it's And field the Which pockets? where? really issues where Now operational project execution It's it's that's skilled people, are. professionals. CRAs,

margin seen -- And increases. the that, of expanded because we've you've from labor seeing cost but pressure we're margins. our Now

intend of So because really, that's productivity initiatives. trend. to our this continue do We

are headwinds, We that sitting throughout are the know and you them, the and year. countering we we've here just not that done watching

a are to that minor is just very we're a because offset to increase again, entirely we fourth not Now we some adjustment lag. the able in labor cost there modest reflect minus -- quarter, made

before highly It You takes expensive skilled of a bit time little are people. recruit field deployed in they and productive. and actually the

And costs. sometimes, you up catch offset with reduction the don't to time the those increases programs cost to just in have

in that I Now sudden, backlog of long-term do to do do not that continue staff this see at all are such trends hard other is point manage in the to conversion these shortage not, widespread that that been at pockets. sites, with have staff going because in those shortages located of compromised. a they a see those or to the way We our thing there. we don't respect the time, and sites, same are it's

-- in it some site. time that globally. reasons the receiving sites of sites due -- most the pressure. some sites the is was able not are sites business the fourth to there them the not flow is from of make to the see patient We samples of because reason are them. expected sites little -- Frankly, at we made a we numbers were And visits less less staff -- not they we've operating have visits had for And been the the quarter handle to that there U.S. mostly lot and are residual very modest on in of the lab the it's a because adjustments patients. They our the had of the line had lot experienced that mostly less they where patient to being were been that all at of is affected the

the what a know And And site. bottleneck. so created we that's it's specific

COVID it's widespread say [indiscernible]. it's me the occurring the going studies is slower and that even for down definition, this that before early complex major too conversion but change was into in be not results and industry. a more So to and Yes, permanent are step a by to

of we'll so deal So, XXXX. this in say is part the to to going we it far, We early cannot able be think that continue. with that

Operator

Patrick from comes question next Citi. with Your Donnelly

Patrick Donnelly

Ron, Great. in there. for a one similar you vein maybe

labor guess, you variable interest costs you next the the jumping the about about talked year? When different I to you P&L, expense, year. the offset of of I touched guess down obviously, on you pressures. inputs, when about ability Again, You next structure about, some there have well. inflationary just the margin can the that talk for as you some with up the Ari, think think

throughout the guys interest a defensiveness, I ability But jumping year? up on do next talked away into insulate you about from to P&L you expense some that how bit little the about think guess, call. of pricing You as you get

Ron Bruehlman

guidance frame And the be year an fundamentally not out factors, this talked the is we about line what to forth. labor you the that. debt the for abate, drive is what we we going of terms on you're hopefully up interest coming and permanent. on executional highlighted be count we going and so and above challenges pretty in offset February don't we for to into see see below what much out And our environment, we'll of what being can we there. point, Obviously, is, that continued reduction. control spend, we very interest the outlook also term. healthy. can't upon looking out We're being based it's Yes, will really offset with see have them Ari like we due items below, next basis. without pressures, expense. changed it then. guidance is about continue what expense do but for said as to at it to to Nothing has laid all to a over less XXXX. below see today, what line some going strong as to fundamentally EBITDA some getting few increases being do we reduction just line rate offset in the in And short And operating to Look, cost try it's but be for we'll which we of But macro And above help in demand lay interest time to the and the the

Ari Bousbib

absolutely you're Yes. correct, And -- absolutely Patrick. again, that's

mentioned We are we this. that plans. I earlier have on working exactly

ratio with here of exception recall the leverage way, us targeting well mentioned, a from changed. will set of at slightest, to our which, perhaps always company, targets, line, before when were by in the we leverage that. will goals haven't by our road as at our the the X. be goals making But the You the we other the be those for gave XX Ron for necessarily XXXX goals And are unchanged. not that, deviate Nothing we've likely but ratio are than is, 'XX least a growth at straight X it's The XXXX same. may

productivity labor decided initiate continued we we series initiatives which of are goals, accelerate these Now in the and headwinds and and had were years, programs fourth the of light increased we've below-the-line in a inflation, them of programs in 'XX the a for 'XX. decided internally, over assuming supposed we given, we initiating the of to support in a 'XX, as to and are next quarter we X both

to yes, the is plan. answer the question So your that's absolutely and

Operator

from Luke comes Barclays. from Sergott Elizabeth question -- final with Your

Luke Sergott

So Ron, one a for you. quick

conversion targeting, you talk You the Can up you is your big guys You here? had range. I which your brought were long-term guess, cash where drivers a XX%, quarter. of to guys about kind

good this the is think So about jump off? a spot to

Ron Bruehlman

but... I'm not the sure jump what you mean off, by

Luke Sergott

'XX, For sorry.

Ron Bruehlman

of Well, volatile. But any year, cash think XX% we inherently in look, net cash given targeted I flow. for XX% income is to adjusted flow

not in cash flow. continue and sales second It's has of outstanding of flow, terms generator. changed the the to cash towards simple, only than strong weight third -- collections, pretty a be cash comment great too not earnings, bit we on quarter. in see So much timing from it to maximizing that better much driving X We're just is less. greater day lot degree. quarter-to-quarter it's the was third in year our quarter the be fundamentally to fluctuations a much so year, that's was going it trying is there it minimize flow. And not quarter-to-quarter, quarter And remain better, may certainly, second nothing And X My had a and it collection like a much the put because of And reason don't cash a better our accrual-based. may you little nature a our quarter.

So a short-term it and to more predict difficult tends be basis. volatile to on more

Luke Sergott

the talk portend of of the right. that bookings? you are size color But shortage then an project Anything that All win quality size? Any question you for bit an overall leave offline. a can change the average or And deceleration lastly duration seeing? I'll in in in about the here, the would acceleration and or staffing more on guys the little

Ari Bousbib

-- QX, qualified the we all, call XX% it's year-over-year. XX% Awards at mean, means I pipeline, every in the sequential number don't stage, the in awards else quarter QX you. flow speculative, The What not not QX. I year-to-date, are it's at up tell awards it's which possible. changed should what RFP ever. are XX% number? second up, is up know nothing early highest growth. I mention in looking Plus Overall, I'm XX% Absolutely advanced, is okay? XX% to

this On demand widespread, of the the we see change. been year. We've for EBP. the the large It's saying -- no from side, pharma, beginning

are coming the but to guess You are as not believing everyone us, are the well. story numbers is showing, I guys else -- and

Operator

to I call back are there And the will turn further over Mr. you. Childs, questions. no

Nick Childs

The to Okay. the Thanks, may Thank have. today. us to of all questions will follow-up you everyone. speaking everyone, We rest any you for team look soon. forward to again you, of joining be day available take

Operator

This concludes today's conference call.

now may disconnect. You

IQVIA (IQV) 26 Oct 222022 Q3 Earnings call transcript