On July 29, 2019 Medpace Holdings, Inc. (Nasdaq: MEDP) ("Medpace") reported financial results for the second quarter ended June 30, 2019 (Press release, Medpace, JUL 29, 2019, View Source [SID1234537859]).

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"In the second quarter, the business environment remained strong, and our competitive win rate remained healthy," said August J. Troendle, President & Chief Executive Officer. "Cancellations in the quarter returned to an anticipated historical range from elevated levels the past two quarters."

Second Quarter 2019 Financial Results

Revenue for the three months ended June 30, 2019 increased 25.8% to $214.1 million, compared to $170.1 million for the comparable prior-year period. On a constant currency organic basis, revenue for the second quarter of 2019 increased 26.0% compared to the second quarter of 2018.

Backlog as of June 30, 2019 grew 19.6% to $1.2 billion from $979.7 million as of June 30, 2018. Net new business awards were $279.2 million, representing a net book-to-bill ratio of 1.30x for the second quarter of 2019, as compared to $239.9 million for the comparable prior-year period. The Company calculates the net book-to-bill ratio by dividing net new business awards by revenue.

For the second quarter of 2019, total direct costs were $150.3 million, compared to total direct costs of $116.7 million in the second quarter of 2018. Selling, general and administrative (SG&A) expenses were $23.6 million, compared to SG&A expenses of $20.5 million in the second quarter of 2018.

GAAP net income for the second quarter of 2019 was $27.5 million, or $0.73 per diluted share, versus GAAP net income of $16.6 million, or $0.45 per diluted share, for the second quarter of 2018. This resulted in a net income margin of 12.8% and 9.7% for the second quarter of 2019 and 2018, respectively.

EBITDA for the second quarter of 2019 increased 20.3% to $40.2 million, or 18.8% of revenue, compared to $33.4 million, or 19.7% of revenue, for the comparable prior-year period. On a constant currency basis, EBITDA for the second quarter of 2019 increased 18.2% from the second quarter of 2018.

Adjusted Net Income for the second quarter of 2019 increased 35.7% to $30.4 million compared to $22.4 million for the comparable prior-year period. Adjusted Net Income per diluted share for the second quarter of 2019 was $0.81, representing an increase of 32.8%, compared to Adjusted Net Income per diluted share of $0.61 for the comparable prior-year period.

A reconciliation of the Company’s non-GAAP financial measures, including EBITDA, EBITDA margin, Adjusted Net Income, and Adjusted Net Income per diluted share to the corresponding GAAP measures is provided below.

Balance Sheet and Liquidity

The Company’s Cash and cash equivalents were $20.1 million at June 30, 2019, and the Company generated $46.6 million in cash flow from operating activities during the second quarter of 2019. Additionally, the Company paid off its remaining outstanding obligations against its term loan during the second quarter of 2019.

Financial Guidance

The Company forecasts 2019 revenue in the range of $840.0 million to $860.0 million, representing growth of 19.2% to 22.1% over 2018 revenue of $704.6 million. GAAP net income for full year 2019 is forecasted in the range of $93.4 million to $97.4 million. Additionally, full year 2019 EBITDA is expected in the range of $144.0 million to $150.0 million.

Based on forecasted 2019 revenue of $840.0 million to $860.0 million and GAAP net income of $93.4 million to $97.4 million, diluted earnings per share (GAAP) is forecasted in the range of $2.49 to $2.60. Adjusted Net Income for 2019 is forecasted in the range of $105.7 million to $109.7 million, compared to Adjusted Net Income of $95.5 million for 2018. Furthermore, Adjusted Net Income per diluted share for 2019 is expected in the range of $2.82 to $2.93 per share.

Conference Call Details

Medpace will host a conference call at 9:00 a.m. ET, Tuesday, July 30, 2019, to discuss its second quarter 2019 results.

To participate in the conference call, dial 800-219-7113 (domestic) or 574-990-1030 (international) using the passcode 6197355.

To access the conference call via webcast, visit the "Investors" section of Medpace’s website at medpace.com. The webcast replay of the call will be available at the same site approximately one hour after the end of the call.

A supplemental slide presentation will also be available at the "Investors" section of Medpace’s website prior to the start of the call.

A recording of the call will be available at 12:00 p.m. ET on Tuesday, July 30, 2019 until 12:00 p.m. ET on Tuesday, August 13, 2019. To hear this recording, dial 855-859-2056 (domestic) or 404-537-3406 (international) using the passcode 6197355.