PAREXEL REPORTS FOURTH QUARTER AND FISCAL 2001 FINANCIAL RESULTS
BOSTON, MA, August 16, 2001 — PAREXEL International Corporation (Nasdaq: PRXL) today announced its financial results for the fourth quarter and fiscal year ended June 30, 2001.
Unless otherwise indicated, the following financial results exclude the effect of restructuring and other one-time charges, and include the effect of a previously reported restatement, where applicable, in both the current and prior periods. For the three months ended June 30, 2001, PAREXEL’s consolidated net revenue was $106.7 million, a record high for the Company, compared with consolidated net revenue of $91.2 million in the prior year period. Quarter-over-quarter, net revenue grew 17%, and excluding the negative impact from foreign exchange, increased 20%. Operating income was $2.3 million versus operating income of $628,000 in the prior year quarter. Net income for the quarter was $2.7 million or $0.11 per diluted share, compared with net income of $1.7 million, or $0.07 per diluted share for the quarter ended June 30, 2000. Excluding the negative impact of the Perceptive Informatics business unit, earnings for the fourth quarter would have been $0.14 per diluted share. On an as reported basis, the Company’s net loss for the quarter was $3.6 million or a loss of $0.15 per share, compared with net income of $1.4 million or $0.05 per diluted share for the fourth quarter ended June 30, 2000. Please refer to the attached financial charts for a detailed presentation of as reported and pro forma results for the fourth quarter and fiscal year.
During the June 2001 quarter, the Company recorded restructuring and one-time charges totaling $9.3 million. These charges include expenses related to lease terminations, facility consolidations, employee severance, and certain other costs.
For the fiscal year ended June 30, 2001, PAREXEL’s consolidated net revenue was $387.6 million compared with consolidated net revenue of $378.2 million the prior year. Year-over-year, net revenue increased 2.5%, or 7.2% excluding the negative impact from foreign exchange. Operating income for Fiscal 2001 was $2.1 million versus $17.1 million the prior year. Net income for the fiscal year was $5.4 million or $0.22 per diluted share, compared with net income of $13.8 million, or $0.55 per diluted share for the year ended June 30, 2000. Excluding the negative impact of Perceptive Informatics, earnings for the fiscal year ended June 30, 2001 would have been $0.36 per diluted share. On an as reported basis, the net loss for the fiscal year was $0.8 million or a loss of $0.03 per share, compared with net income of $4.4 million or $0.17 per diluted share for Fiscal Year 2000.
On a segment basis, net revenue for the fourth quarter grew sequentially in each of the Company’s strategic business units. Net revenue was $63.9 million in Clinical Research Services, $23.2 million in the PAREXEL Consulting Group, $15.9 million in Medical Marketing Services, and $3.7 million in Perceptive Informatics, Inc.
For the six-month period from January to June 2001, PAREXEL reported net new business (gross new business less cancellations) of $272.6 million. Net new business increased 14.5% sequentially compared with the six-month period from June to December of 2000, and 67.6% from the same six-month period one year ago. Backlog at June 30, 2001 was $504.4 million, an increase of 14.4% over the December 2000 backlog, and an increase of approximately 31% over the backlog at the end of Fiscal 2000.
Mr. Josef H. von Rickenbach, PAREXEL’s Chairman and Chief Executive Officer stated, “As we entered into Fiscal 2001 last July, the pharmaceutical services industry was struggling in the aftermath of unprecedented project cancellations and delays. Clearly, Fiscal 2001 has been a turnaround year for PAREXEL and the industry in general. Our focus on revenue growth, combined with an enhanced global resource base, has resulted in a second consecutive quarter of record revenue. I am also pleased that our gross operating margins have improved across all Strategic Business Units year-over-year in the fourth quarter. Margin improvement continues to be our highest priority, and I am confident that we will continue to see progress in this key area during the course of Fiscal 2002.”
“The Company’s strong global infrastructure continues to be a significant competitive differentiator. Opportunities for large global trials are increasing, and we are well-positioned to win them. On the information technology front, the investment we made during Fiscal 2001 in Perceptive Informatics has shown positive results and is tracking according to plan. This unit’s revenue, which has grown well over 50% since the end of the first quarter of Fiscal 2001, demonstrates the favorable acceptance of Perceptive’s offerings in the marketplace.”
The Company issued forward-looking guidance regarding revenue and earnings per share for the first quarter of Fiscal 2002 (ending September 30, 2001), and for Fiscal 2002. For the first quarter of Fiscal 2002, the Company anticipates reporting net revenue in the range of $100 to $103 million. Earnings per diluted share are expected to be in the range of $0.09 to $0.11. For Fiscal 2002, expectations are for revenue in the range of $425 to $445 million and earnings per diluted share ranging from $0.50 to $0.54.
PAREXEL is one of the largest contract pharmaceutical outsourcing organizations in the world, providing a broad range of knowledge-based contract research, medical marketing and consulting services to the worldwide pharmaceutical, biotechnology and medical device industries. With a commitment to providing solutions that expedite time-to-market and peak market penetration, PAREXEL has developed significant expertise in clinical trials management, data management, biostatistical analysis, medical marketing, clinical pharmacology, regulatory and medical consulting, industry training and publishing and other drug development consulting services. Its information technology subsidiary, Perceptive Informatics, Inc., provides a variety of technology products and services, including web-based portal solutions and voice and data systems, which are designed to accelerate and enhance the clinical development and launch processes. The Company’s integrated services, therapeutic area depth and sophisticated information technology, along with its experience in global drug development and product launch services, represent key competitive strengths. Headquartered near Boston, MA, PAREXEL operates in 54 locations throughout 35 countries around the world, and as of June 30th had approximately 4,640 employees. Headcount increased to 4,695 with the acquisition of EDYABE, which was announced in July 2001.
This release may contain "forward-looking" statements regarding future results and events, including statements regarding expected financial results, future growth and customer demand that involve a number of risks and uncertainties. For this purpose, any statements contained herein that are not statements of historical fact may be deemed forward-looking statements. Without limiting the foregoing, the words "believes", "anticipates", "plans", "expects", "intends", "appears" and similar expressions are intended to identify forward-looking statements. The Company's actual future results may differ significantly from the results discussed in the forward-looking statements contained in this release. Important factors that might cause such a difference include, but are not limited to, risks associated with: actual operating performance; actual expense savings and other operating improvements resulting from recent restructurings; the cancellation, revision, or delay of contracts, including those contracts in backlog; the Company's dependence on certain industries and clients; the Company's ability to win new business, manage growth, and attract and retain employees; the Company's ability to complete additional acquisitions and to integrate newly acquired businesses or enter into new lines of business; government regulation of certain industries and clients; competition and consolidation within the pharmaceutical industry; the potential for significant liability to clients and third parties; the potential adverse impact of health care reform; and the effects of exchange rate fluctuations. Such factors and others are discussed more fully in the section entitled "Risk Factors" of the Company's Form 10-Q for the period ended March 31, 2001, as filed with the Securities and Exchange Commission.