PAREXEL REPORTS SECOND QUARTER FINANCIAL RESULTS
BOSTON, MA, January 25, 2001 — PAREXEL International Corporation (Nasdaq: PRXL) today announced its financial results for the second quarter ended December 31, 2000.
For the three months ended December 31, 2000, PAREXEL’s consolidated net revenue was $94.3 million versus net revenue of $97.9 million in the prior year period. Operating income was $0.2 million versus operating income of $6.3 million in the prior year quarter. Net income for the quarter was $1.0 million or $0.04 per diluted share, compared with net income of $5.1 million, or $0.20 per diluted share for the quarter ended December 31, 1999. Excluding the negative impact of the newly created Perceptive Informatics business unit, earnings for the second quarter would have been $0.07 per share.
For the six months ended December 31, 2000, PAREXEL’s consolidated net revenue was $182.5 million compared with net revenue of $189.7 million in the prior year six-month period. The operating loss for the six months was $0.9 million versus operating income of $12.0 million in the prior year six-month period. Net income for the six months was $0.9 million or $0.03 per diluted share, compared with net income of $8.9 million, or $0.35 per diluted share for the six months ended December 31, 1999. Excluding the impact of Perceptive Informatics, earnings for the six months would have been $0.09 per share.
On a segment basis, consolidated net revenue for the second quarter was $59.2 million in Clinical Research Services (CRS), $19.1 million in the PAREXEL Consulting Group (PCG), $13.4 million in Medical Marketing Services (MMS), and $2.6 million in Perceptive Informatics, Inc. Of particular note, revenue in CRS grew 8% over the September quarter, while gross margin improved 1 percentage point to 32% during the same period.
For the six-month period from July to December 2000, PAREXEL reported gross new business authorizations of $274.6 million, and cancellations of $36.5 million (13% of gross new business authorizations). Net new business authorizations (gross new business less cancellations) were $238.1 million. The ending backlog on December 31, 2000 was $440.7 million, an increase of 14.4% over the last six months.
Mr. Josef von Rickenbach, PAREXEL’s Chairman and Chief Executive Officer stated, "As we anticipated, second quarter results showed sequential improvement from the first quarter, and we appear to be regaining top line momentum. We were pleased to see the increase in the net backlog as well as the significant decrease in the cancellation rate. We believe that these are indicators that some of our larger pharma clients are gearing up their research and development activities once again, and also points to our success in continuing to win contracts from small and large clients alike."
Mr. von Rickenbach continued, "As we move into calendar 2001, the company will be working to achieve several goals. We will be focusing on improving margins, increasing market share, further developing our Perceptive Informatics business to solidify our technology leadership position, and better capitalizing on various business unit synergies."
The Company issued forward-looking guidance regarding revenue and pro forma earnings per share (not taking into account any unusual charges) for the remainder of Fiscal 2001 (ending June 30, 2001), and for calendar 2001. For the third quarter of FY 2001 the Company anticipates reporting revenues in the range of $95 to $100 million and earnings per diluted share of $0.08 to $0.09. For Fiscal 2001, PAREXEL anticipates revenues to be in the range of $375 to $385 million, and earnings per diluted share to be in the range of $0.23 to $0.25. All of the above are consistent with analysts’ current expectations for the Company. For calendar 2001, expectations are revenues of $400 to $420 million and earnings per diluted share of $0.45 to $0.55.
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 newest 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 47 locations throughout 29 countries around the world, and has approximately 4,350 employees.
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 manage growth and its ability to 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 September 30, 2000, as amended by a Form 10-Q/A filed with the Securities and Exchange Commission on January 5, 2001.