PAREXEL REPORTS THIRD QUARTER FINANCIAL RESULTS
BOSTON, MA, April 25, 2002 — PAREXEL International Corporation (Nasdaq: PRXL) today announced its financial results for the third quarter ended March 31, 2002. In order to conform with newly issued guidelines under Generally Accepted Accounting Principles (GAAP), PAREXEL began reporting revenue and costs associated with reimbursable “out-of-pocket” expenses in the Company’s income statements. Implementation of the new accounting guidance has no impact on earnings. To maintain consistency with previous reporting practices, the discussion below is based upon service revenue and related costs, and excludes revenue and costs related to reimbursable out-of-pocket expenses.
For the three months ended March 31, 2002, PAREXEL’s consolidated service revenue grew approximately 14% to a record high $112.0 million compared with consolidated service revenue of $98.3 million in the prior year quarter. Operating income was $4.6 million, or 4.1% of service revenue, versus operating income of $684 thousand, or 0.7% of service revenue in the comparable quarter of the prior year. Net income for the quarter was $3.7 million or $0.14 per diluted share, compared with net income of approximately $1.9 million, or $0.08 per diluted share, for the quarter ended March 31, 2001. Excluding the negative impact from the Perceptive Informatics business unit, earnings per diluted share would have been $0.15 in the quarter.
Service revenue for the third quarter was $64.8 million in Clinical Research Services, $25.8 million in the PAREXEL Consulting Group, $16.2 million in Medical Marketing Services, and $5.2 million in Perceptive Informatics, Inc.
For the nine months ended March 31, 2002, consolidated service revenue was $320.7 million versus consolidated service revenue of $280.9 million in the prior year period, an increase of approximately 14%. Operating income for the current nine-month period was $11.3 million compared with a pro forma operating loss of $259 thousand in the prior year nine-month period. Net income for the nine months was $9.2 million or $0.36 per diluted share, compared with pro forma net income of $2.7 million, or $0.11 per diluted share in the prior year nine-month period. Excluding the negative impact from Perceptive Informatics, earnings per diluted share would have been $0.41 in the nine-month period ending March 31, 2002.
Mr. Josef H. von Rickenbach, PAREXEL’s Chairman and Chief Executive Officer stated, “We are pleased with the quarter’s results which came in at the upper end of the previously-issued EPS guidance, and with the Company’s progress in continuing to improve profitability. The PAREXEL Consulting Group and Medical Marketing Services each reported strong year-over-year organic revenue growth in excess of 20% this quarter, while Perceptive Informatics quarterly revenue grew more than 65% year-over-year. The strength of these three units points to the success of our diversified business model. Although Clinical Research Services revenue only grew 7.2% year-over-year, we believe the healthy increase in the dollar value of proposals indicates improved momentum for CRS later in the calendar year”.
The Company issued the following forward-looking guidance regarding revenue and earnings per share estimates. For the fourth quarter of Fiscal 2002, the Company anticipates reporting service revenue in the range of $114 to $119 million and earnings per diluted share of approximately $0.15 to $0.16. Achieving those objectives would result in service revenue for Fiscal 2002 (ending June 30, 2002), in the range of $435 to $440 million, and earnings per diluted share in the range of $0.51 to $0.52. For Calendar 2002, the Company anticipates reporting service revenue of between $465 and $480 million, and earnings per diluted share of between $0.61 and $0.65. For Fiscal 2003 (ending June 30, 2003), the Company’s preliminary expectations are for service revenue in the range of $485 to $500 million and earnings per diluted share in the range of $0.70 to $0.74.
PAREXEL’s Third Quarter Earnings Conference Call will begin at 10 a.m. EDT on Thursday, April 25th and will be broadcast live over the internet via webcast. The webcast may be accessed in the “Webcasts” portion of the Investor Relations section of the Company’s website at http://www.parexel.com. Users should follow the instructions provided to assure that the necessary audio applications are downloaded and installed. A replay of this webcast will be archived on the website approximately two hours after the call and will continue to be accessible for one month following the live event.
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 55 locations throughout 37 countries around the world, and has approximately 4,800 employees.
This release contains "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", “estimates”, “projects” 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 December 31, 2001, as filed with the Securities and Exchange Commission, which “Risk Factors” discussion is incorporated by reference in this press release. The Company disclaims any duty to update any of the forward-looking statements contained in this press release.