Syneos Health, Inc.

Good morning and welcome to the Cineos Health second quarter 2021 earnings conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session and instructions will be given at that time. I would like to hand the conference over to Ronnie Speight, Senior Vice President of Investor Relations. Please go ahead, sir.

Good morning, everyone. With me on the call today are Alistair McDonald, our Chief Executive Officer, Jason Meggs, our Chief Financial Officer, Michelle Keefe, our President of Commercial Solutions, and Paul Colvin, our President of Clinical Solutions. In addition to the press release, a slide presentation corresponding to our prepared remarks is available on our website at investor.cineoshealth.com. Remarks that we make about future expectations, plans, growth, anticipated financial results, and prospects, and our expectations regarding the COVID-19 pandemic constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995, and we disclaim any obligation to update them. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors. These factors are discussed in the risk factors section of our Form 10-K for the year ended December 31, 2020 and our other SEC filings. During this call, we will discuss certain non-GAAP financial measures which exclude the effects of events and transactions we consider to be outside of our core operations. These non-GAAP measures should be considered a supplement to and not a replacement for measures prepared in accordance with GAAP. For a reconciliation of non-GAAP financial measures with the most directly comparable GAAP measures, please refer to the appendix of our presentation. I would now like to turn the call over to Alistair MacDonald. Alistair?

Thanks, Ronnie. Good morning, everyone, and thank you for joining us today. I hope you and your families are in good health. I'm excited to share another strong quarter of results, which demonstrate that our differentiated product development strategy continues to resonate in the market. We exceeded the midpoint of our guidance across all financial metrics for the second quarter, and our integrated product offerings powered strong awards and backlog growth for both segments. Most importantly, both clinical and commercial revenue returned to robust year-over-year growth, a trend we expect to continue for the balance of 2021. Now for some key highlights from the quarter. First, overall net awards grew by 25.6% year-over-year, including clinical growth of 21.2% and commercial growth of 55.3%. This award strength drove second quarter book-to-bill ratios of 1.45 times for clinical solutions and 0.94 times for commercial solutions, resulting in robust TTM back book-to-bill ratios of 1.37 times for clinical and 1.14 times for commercial. Second, we achieved strong profitability gains with 47.1% year-over-year adjusted EBITDA growth and a 190 basis point improvement in adjusted EBITDA margin compared to the second quarter of 2020. Thirdly, we continue to attract world-class leadership talent, and I'm excited about the addition of Michael Brooks as our Chief Development Officer. Michael's deep experience and connections in clinical development and commercialization will drive our go-to-market strategy advance innovation, and enhance the voice of the customer across the product development continuum to create better patient outcomes. Also, at the board level, we are enthusiastic about the recent addition of Dr. David Wilkes. As a champion for addressing disparities in healthcare, Dr. Wilkes shares our passion for positively impacting patients' lives. We look forward to benefiting from his impressive industry experience and medical expertise. Now, moving into further details on our results. We continued to recover from the impacts of COVID-19 as our total company sequential revenue growth strengthened and year-over-year revenue growth accelerated to 26.6% compared to the second quarter of 2020. Clinical solutions revenue grew 31.1% compared to the second quarter of 2020, driven by accelerating startup of both non-COVID and COVID clinical projects. and contributions from our 2020 acquisitions. Our clinical team also closed the record quarter of net awards that were fueled in part by continued strength in the SMID segment. These awards also included three large-scale FSP360 wins where we are replacing existing providers, demonstrating the competitiveness, scale, and flexibility of our solutions. Under our awards policy for FSP services, we only included 12 months of services in our bookings, even though each agreement represented an initial term of at least three years. The remainder provides further fuel for growth in addition to our reported backlog. Driven by these strong sales, record-ending backlog that is up 21.5% and a robust pipeline of new opportunities, Clinical Solutions remains well positioned for strong revenue growth in the second half of 2021 and beyond. Our second quarter clinical awards also included several COVID-19 related projects, although this category, including treatment therapeutics, remained at less than 4% of our backlog at the end of the quarter. Given this limited backlog concentration of COVID studies, we expect our robust revenue growth in 2022 will be driven by the strength of our non-COVID backlog. Given growing customer demand for decentralized clinical trials, we continue to enhance the way we engage with sites, patients, and physicians. Our decentralized trial solutions are designed to bring trials closer to the patient, reducing site and patient burden while expanding participant diversity. We recently launched two initiatives to foster improved engagement. First, we established a dedicated decentralized trials site advocacy group. focused on new technology optimization to make trials more accessible while improving data capture along with participant diversity and retention. Second, we launched our Patient Voice Consortium, a cross-functional hub that integrates strategic patient perspectives throughout the product development lifecycle. We believe these efforts set the standard for best practices in incorporating patient insights into clinical trial design, communications, access initiatives, and launch strategies. We also continue to expand our dynamic assembly network of DCT data and technology providers in order to best serve our customers with the recent announcement of our relationship with ATEON. ATEON provides regulatory-grade data and analytics to produce real-world evidence on the safety, effectiveness, and value of treatments for patients and other stakeholders. These initiatives, in combination with our Illingworth Home Health Services, represent significant inroads toward improving the patient experience and realizing our vision of shortening the distance from lab to life. Turning now to commercial solutions. We saw accelerating sequential recovery and a return to year-over-year revenue growth of 13.2% compared to the second quarter of 2020. Year-over-year growth in our core business was even stronger, but was partially offset by the headwind from the divestiture of our medication adherence business in the fourth quarter of 2020. All of our core commercial businesses posted a return to strong year-over-year growth. Deployment solutions had another quarter of strong new team starts, and the number of deployed resources reached a four-year high. Consulting completed a very strong first half of the year, and communications continues to see strength in the public relations and medical communications businesses. Importantly, full-service commercial growth awards, where we strategically combine these capabilities, have more than doubled on a year-to-date basis compared to 2020. This performance highlights the continued success of our integrated model, fueling growth across our commercial portfolio. Additionally, several key factors are contributing to the ongoing diversification of our deployment solutions business, which we expect to improve the consistency of future commercial growth, including our ability to deliver sophisticated solutions the continued evolution toward more targeted therapies, and the strong biotech funding environment. These dynamics have supported a migration towards smaller average field team sizes, a lower concentration of sales-only teams and revenue, and longer project durations. Our commercial expertise also continues to fuel innovation across the product development continuum, with dynamic engagement capabilities such as Kinetic, which seeks to optimize HCP engagement through a combination of face-to-face and virtual field team activities. Additionally, we are seeing increased adoption of the digital amplifier component of Kinetic by our clinical customers, where this capability is designed to accelerate patient engagement and enrollment by driving patient referrals by physicians into clinical trials. We believe this unique suite of capabilities differentiates Cineos Health and is a key factor in driving our strong new business awards. Lastly, Cineos One, our innovative end-to-end product development methodology, continues to provide a competitive advantage across both segments. We are particularly excited about the Cineos One contribution to growing the pipeline of potential commercial awards and revenue, with the first of many Cineos One portfolio assets set to begin commercialization in the third quarter. Although these assets have not featured prominently in commercial awards or revenue to date, We expect the Cineos One portfolio, along with our integrated full-service commercial and innovative kinetic capabilities, to position us well to capitalize further on strong market demand and drive robust commercial revenue growth over the long term. Before I turn the call over to Jason, I want to thank the entire Cineos Health community for their ongoing resilience, focus, and collaboration as we work together to help our customers improve and accelerate the delivery of therapies that impact health worldwide. Their continued commitment to collaboration, inclusive thinking, and use of insights is helping build a superior culture to deliver high levels of innovation for our customers and their patients. Jason will now provide additional comments on our financial performance and guidance. Jason?