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Abonner Quintiles Transnational Corp.

Quintiles Transnational Corp.

Quintiles Reports 2nd Quarter Net Revenue of $426 Million

Research Triangle Park, North Carolina (ots/PRNewswire)

  • Strong net new business growth, up 31% for first half of 2004
  • Fourth consecutive half-year increase in total net new business wins
Quintiles Transnational Corp. today announced financial results
for the quarter ended June 30, 2004. Net revenue for second quarter
2004 was  US$425.8 million versus US$408.4 million for the same
period in 2003. Net  loss for second quarter 2004 was US$10.1
million, reflecting increased costs  and expenses from project
startups.
For the first half of 2004, net new business totaled an estimated
US$954.5 million, a 31% increase from the US$727.3 million in net new
business reported for the same period in 2003. Total backlog as of
June 30, 2004, was approximately US$2.2 billion.
"We continue to perform strongly in winning new business -- almost
a billion dollars in the first six months of the year," said
Quintiles Transnational Chairman and Chief Executive Officer Dennis
Gillings, Ph.D. "This is our fourth consecutive half-year increase in
net new business and further evidence of the high-quality work we do
for customers and our increased business development efforts."
Quintiles Transnational Executive Vice President and Chief
Financial Officer John Ratliff said: "In addition to new business
wins, we are pleased with our sequential quarterly growth in service
revenue. Our plans now are to build on these strengths while focusing
on increasing margins."
During second quarter 2004, Quintiles and Mitsui & Co. completed a
previously announced transaction whereby Mitsui become a 20%
shareholder in Quintiles Transnational Japan K.K. Quintiles and
Quintiles Japan received a total of approximately 8.7 billion yen
(approximately US$79.9 million) in cash from Mitsui in the
transaction, with Quintiles having the ability to receive up to an
additional 2.0 billion yen (approximately US$18.5 million) based on
Quintiles Japan's future financial performance. As a result of the
Mitsui transaction, Quintiles recognized a pre-tax gain of US$34.7
million during the quarter.
Earlier this week, Quintiles and Bradley Pharmaceuticals, Inc.
(NYSE: BDY) completed the previously announced sale of certain assets
relating to its Bioglan Pharmaceuticals subsidiary to Bradley for
US$188.3 million in cash, including approximately US$5.4 million of
direct costs for transferred inventory. During the quarter, Bioglan
was classified as a discontinued operation.
"The closings of the Mitsui and Bioglan transactions further
bolster our already strong cash position," Ratliff said. As of June
30, 2004, prior to the closing of the Bioglan transaction, Quintiles
had cash, cash equivalents, marketable securities and debt
investments valued at US$421.2 million.
Quintiles Transnational's second quarter 2004 financial briefing
will be held at 9:00 a.m. EDT on Monday, Aug. 16, and will be
broadcast live over the Web. The webcast or replay, which will be
available through 5:00 p.m. EDT Aug. 27, can be accessed at
http://www.quintiles.com/corporate_info/broadcast_center .
Quintiles helps improve healthcare worldwide by providing a broad
range of professional services, information and partnering solutions
to the pharmaceutical, biotechnology and healthcare industries.
Headquartered near Research Triangle Park, North Carolina, Quintiles
has offices in 50 countries and is the world's leading pharmaceutical
services organization. For more information visit the company's Web
site at http://www.quintiles.com .
The schedules attached to this release are an integral part of
this release. Information in this press release contains "forward
looking statements" about Quintiles. These statements involve risks
and uncertainties that could cause actual results to differ
materially, including, without limitation, the ability to maintain
large customer contracts or to enter into new contracts, changes in
trends in the pharmaceutical industry, the risk that the market for
our products and services will not grow as we expect, the risk that
our PharmaBio transactions will not generate revenue or profit at the
rate or levels we anticipate or that royalty revenues under the
PharmaBio agreements may not be adequate to offset Quintiles' upfront
and ongoing expenses in providing sales and marketing services or in
making milestone and marketing payments, our ability to fulfill our
obligations under our financing arrangements and the potential impact
on our operations, our ability to efficiently distribute backlog
among project management groups and match demand to resources, actual
operating performance, variation in the actual savings and operating
improvements resulting from previous restructurings, and the ability
to operate successfully in new lines of business. Additional factors
that could cause actual results to differ materially are discussed in
the company's recent filings with the Securities and Exchange
Commission, including but not limited to its Annual Report on Form
10-K, its Form 8-Ks, and its other periodic reports, including Form
10-Qs.
All figures in US$
    Condensed Consolidated Statements of Income
    (Unaudited)
                                    Three     Three        Six       Six
                                    months    months      months    months
                                    ended     ended       ended     ended
                                   June 30,  June 30,    June 30,  June 30,
                                     2004      2003        2004      2003
                                  Successor Predecessor Successor Predecessor
    In thousands
    Net revenues                     $425,766  $408,398   $848,960   $811,952
    Add:  reimbursed service costs     82,306    96,797    164,765    191,138
    Gross revenues                    508,072   505,195  1,013,725  1,003,090
    Costs, expenses and other:
         Costs of revenues            372,062   337,493    728,664    669,600
         General and administrative   158,984   137,232    314,602    268,236
         Interest expense (income),
          net                          14,576    (4,360)    29,195    (8,128)
         Other (income) expense, net    1,199    (8,267)    (1,992)   (5,425)
         Transaction                        0     2,231          0      3,887
         Gain on sale of portion of
          an investment in a
          subsidiary                  (24,688)        0    (24,688)         0
         Non-operating gain on
          change of interest
          transaction                 (10,030)        0    (10,030)         0
                                      512,103   464,329  1,035,751    928,170
    (Loss) income before income
     taxes                             (4,031)   40,866    (22,026)    74,920
    Income tax expense                 14,133    14,531     13,408     27,020
    (Loss) income before equity in
     earnings of unconsolidated
     affiliates and other             (18,164)   26,335    (35,434)    47,900
    Equity in losses of
     unconsolidated affiliates and
     other                               (201)       20       (456)        16
    (Loss) income from continuing
     operations                       (18,365)   26,355    (35,890)    47,916
    Income from discontinued
     operation                          8,280     3,242     10,141      6,837
    Net (loss) income                $(10,085)  $29,597   $(25,749)   $54,753
  Consolidated Balance Sheet Data
    (Unaudited)
                                              June 30,        December 31,
                                                2004              2003
    In millions                              Successor         Successor
    Cash, cash equivalents and debt
     investments                                      $387              $385
    Investments in marketable equity
     securities                                         34                58
    Investments in non-marketable equity
     securities and loans                               53                49
    Investments in unconsolidated
     affiliates                                        121               121
    Working capital                                    285               213
    Total assets                                     1,990             1,993
    Debt including current portion                     793               794
    Shareholders' equity                               510               535
    Segment Information
    (Unaudited)
                              Three months Three months Six months Six months
                                  ended      ended        ended      ended
                                 June 30,   June 30,     June 30,   June 30,
                                   2004       2003         2004       2003
                                Successor  Predecessor  Successor Predecessor
    In thousands
    Service revenues:
       Product development         $268,363  $251,374    $531,047    $501,410
       Commercial services          158,859   138,852     305,846     265,567
       Informatics                        0         0           0           0
       Eliminations                  (8,596)  (10,893)    (14,879)   (18,988)
    Total net service revenues      418,626   379,333     822,014     747,989
    PharmaBio Development
       Commercial rights and
        royalties                    15,155    17,753      30,741      34,704
       Investment                    (8,015)   11,312      (3,795)     29,259
    Total PharmaBio Development       7,140    29,065      26,946      63,963
    Total net revenues              425,766   408,398     848,960     811,952
    Reimbursed service costs         82,306    96,797     164,765     191,138
    Gross revenues                 $508,072  $505,195  $1,013,725  $1,003,090
    Contribution (revenues less
     cost of revenues excluding
     depreciation and amortization
     expense except as noted
     below):
       Product development         $128,353  $128,080    $256,414    $254,394
       Commercial services           61,310    50,713     115,865      95,623
       PharmaBio Development
        (includes amortization
        and depreciation expense
        noted below)                (21,497)    9,415     (22,156)     24,126
       Informatics                        0         0           0           0
    Total contribution             $168,166  $188,208    $350,123    $374,143
    Depreciation and amortization
     expense (excluded from
     contribution except as noted
     below):
       Product development          $21,182   $14,427     $42,772     $29,374
       Commercial services            7,823     5,875      16,007      10,866
       PharmaBio Development
        (included in
        contribution)                 1,015       771       1,819       1,531
       Informatics                        0         0           0           0
       Corporate                      3,151       203       6,284         413
    Total depreciation and
     amortization expense           $33,171   $21,276     $66,882     $42,184
    Web site:  http://www.quintiles.com/corporate_info/broadcast_center
               http://www.quintiles.com

Contact:

Jay Johnson, Media Relations, media.info@quintiles.com, or Greg
Connors, Investor Relations, invest@quintiles.com, both of Quintiles
Transnational Corp., +1-919-998-2000