Solskin In May, I believed that there were still many question marks on Fortrea Holdings Inc. (NASDAQ:FTRE), a focused contract research organization. The spin-off from Labcorp Holdings Inc. (LH) has been battered because of flattish sales trends, a lack of earnings, and substantial leverage employed. Earlier this year, the company divested some assets to reduce leverage, as the lack of earnings remains a problem, despite modest topline sales growth and talks about a growing backlog. With the business now s ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to ______ Commission File Number 001-41704 FORTREA HOLDINGS INC. (Exact name of registrant as specified in its charter) Delaware 92-2796441 | --- | --- | --- | |-- ...

Financial Data and Key Metrics Changes - Revenues for Q2 2024 were $662.4 million, a decline of 8.6% year-on-year, primarily due to lower pass-through revenues and service fee revenues [16][19] - Adjusted EBITDA for the quarter was $55.2 million, down 23.2% year-on-year, but increased by 103.7% sequentially from Q1 2024 [20][28] - The book-to-bill ratio for the quarter was 0.96, while the trailing 12-month book-to-bill was 1.16 [19] Business Line Data and Key Metrics Changes - The clinical pharmacology business showed strong performance with attractive book-to-bill ratios and increased win rates in Phase 1b and 2 studies [7] - New offerings, including a diversity and inclusion solution and an AI Innovation Studio, were launched to enhance productivity and patient access [8][9] Market Data and Key Metrics Changes - The pipeline at the beginning of Q2 was 11% larger than the average of the previous three quarters, indicating a strong outlook for the second half of the year [12][13] - The company has seen a shift towards larger pharma clients, which is expected to provide more predictable revenue streams [31][44] Company Strategy and Development Direction - The company aims to improve margins while delivering quality work and is focused on enhancing operational efficiency through restructuring and cost management [6][24] - Fortrea is positioning itself as a partner for both biotech and large pharma, emphasizing productivity and scientific expertise [62] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in predicting biotech contracting timelines but expressed confidence in the strong pipeline and upcoming opportunities [31][44] - The company is targeting a revenue range of $2.7 billion to $2.75 billion for 2024, reflecting a decline of around 4% compared to 2023 [26][27] Other Important Information - The company has exited approximately 60% of its TSA agreements with its former parent and has significantly reduced its balance sheet leverage by paying down $500 million of spin-related debt [14][23] - The effective tax rate for continuing operations was negative 12.1%, primarily due to a forecasted pre-tax loss and changes in evaluation allowance [18][19] Q&A Session Summary Question: Can you quantify the impact of service fee revenue and pass-throughs? - Management noted that pass-through revenues were significantly impacted by biomarker studies normalizing, which had previously inflated revenues [37] Question: What were the drivers behind the reduction in operating costs? - The reduction was attributed to ongoing restructuring efforts and improved IT spending, with expectations for continued benefits in Q3 and Q4 [39][40] Question: What gives confidence in the upcoming book-to-bill ratio? - Confidence stems from a strong pipeline with more large pharma opportunities, which tend to be more predictable compared to biotech [44] Question: How are margins expected to improve in 2025? - Margins are expected to improve through a combination of gross margin enhancements and SG&A reductions as the company exits TSA services [47] Question: How is the pricing environment in biotech versus large pharma? - Pricing in biotech remains disciplined, while large pharma is seeing competitive pricing, particularly in full-service outsourcing [55][56]

Fortrea Holdings Inc. (FTRE) came out with a quarterly loss of $0.03 per share versus the Zacks Consensus Estimate of $0.07. This compares to earnings of $0.52 per share a year ago. These figures are adjusted for nonrecurring items. This quarterly report represents an earnings surprise of -142.86%. A quarter ago, it was expected that this company would post a loss of $0.01 per share when it actually produced a loss of $0.04, delivering a surprise of -300%. Over the last four quarters, the company has surpas ...

Exhibit 99.1 ✈ Fortrea Fortrea Reports Second Quarter 2024 Results For the three months ended June 30, 2024, from continuing operations: • Revenues of $662.4 million • GAAP net loss of $(99.3) million • Adjusted EBITDA of $55.2 million • GAAP and adjusted loss per share of $(1.11) and $(0.03), respectively • Book-to-bill ratio of 0.96x, resulting in 1.16x book-to-bill for the trailing 12 months • Completed divestiture of assets relating to the Endpoint Clinical and Patient Access businesses • Debt paydown o ...

For the three months ended June 30, 2024, from continuing operations: Revenues of $662.4 million GAAP net loss of $(99.3) million Adjusted EBITDA of $55.2 million GAAP and adjusted diluted loss per share of $(1.11) and $(0.03), respectively Book-to-bill ratio of 0.96x, resulting in 1.16x book-to-bill for the trailing 12 months Completed divestiture of assets relating to the Endpoint Clinical and Patient Access businesses Debt paydown of $504 million in the quarter using initial divestiture and securitizatio ...

To participate in the earnings call, participants should register online at the Fortrea Investor Relations website. To avoid potential delays, please join at least 10 minutes prior to the start of the call. The conference call can also be accessed through the following earnings webcast link. About Fortrea Fortrea Contacts: A replay of the live conference call will be available shortly after the conclusion of the event and accessible on the events and presentations section of the Fortrea Investor Relations w ...

DURHAM, N.C., July 17, 2024 (GLOBE NEWSWIRE) -- Fortrea (Nasdaq: FTRE) (the "Company"), a leading global contract research organization (CRO), today announced that it will release its second quarter 2024 financial results before the market opens on Monday, August 12, 2024. Fortrea will host a conference call at 9:00 am ET that day to review its financial results and conduct a question-and-answer session. To participate in the earnings call, participants should register online at the Fortrea Investor Relatio ...

Parks brings three decades of experience to the role. Starting his career in public accounting at Ernst & Young LLP, he served clients in global and regulated industries, including defense and construction. He was senior vice president and corporate controller at Quintiles, now IQVIA, and CAO at Syneos, a leading biopharmaceutical solutions organization. Most recently, Parks served as CAO at SailPoint Technologies Holdings, a leader in identity security software. He is a certified public accountant and earn ...

"We are pleased to welcome Bobby to the Fortrea team, bringing his broad and deep experience from CROs and other fast-paced environments," said Fortrea Chief Financial Officer Jill McConnell. "Bobby has a track record of managing Sarbanes-Oxley Act requirements and internal controls, including for CROs, in a public-company setting. He is a strategic thinker who understands our customers and our business priorities. I look forward to Bobby making a fast start as CAO and a significant contribution to Fortrea' ...