PPD REPORTS FIRST QTR '05 NET REVENUE OF $244.1 MILLION.
First quarter 2005 income from operations was $47.9 million, compared to income from operations of $38.5 million for the same period in 2004. Research and development expense for the first quarter 2005, which was primarily related to compound partnering, was $8.8 million, compared to R&D expense of $1.3 million for the same period last year. First quarter 2005 income from operations included a $5.1 million pre-tax gain on the exchange of assets associated with our acquisition of SurroMed, Inc.'s biomarker business. First quarter 2004 income from operations included $0.5 million in restructuring charges.
First quarter 2005 earnings per diluted share were $0.62, compared to earnings per diluted share of $0.44 for the first quarter 2004. First quarter 2005 earnings per diluted share included the gain on the exchange of assets related to our acquisition of SurroMed's biomarker business. This gain on the exchange of assets resulted in a $0.07, net of tax, impact on first quarter 2005 earnings per diluted share.
The effective tax rate for the first quarter 2005 was 27.5 percent. The effective tax rate was positively impacted by a $3.7 million reduction in our capital loss valuation allowance due to the recognition of capital gains for both the SurroMed transaction and the dapoxetine NDA milestone. This reduction in capital loss valuation allowances decreased the effective tax rate by 7.5 percent.
Development segment net revenue, which does not include reimbursed out-of-pocket expenses, for the first quarter of 2005 was $212.9 million, an increase of 21.9 percent over the same period in 2004. Development segment income from operations for the first quarter 2005 was $41.8 million, compared to $35.0 million for the same period in 2004.
Discovery sciences segment net revenue, which does not include reimbursed out-of-pocket expenses, was $12.9 million for the first quarter of 2005, compared to net revenue of $7.5 million in the same period last year. First quarter 2005 discovery sciences net revenue included the $10.0 million milestone payment related to the filing of the dapoxetine NDA, and first quarter 2004 net revenue included a $5.0 million payment to us for the dapoxetine out-license amendment. Discovery sciences segment first quarter 2005 income from operations was $6.1 million, compared to $3.5 million for the first quarter 2004. First quarter 2005 income from operations included the $5.1 million pre-tax gain on the exchange of assets.
Other Financial Information
New business authorizations for the first quarter of 2005 totaled $331.3 million. The first quarter 2005 cancellation rate was 15 percent resulting in backlog growth of 16.2 percent compared to first quarter 2004. Net days sales outstanding at March 31, 2 005 were 32 days. First quarter 2005 cash flow from operations was $47.4 million. At March 31, 2005, PPD had $236.4 million in cash and minimal debt.
"PPD continues to build value for the future through our focus on a number of quality and operational initiatives in the core business and the implementation of our compound partnering vision," said Fred Eshelman, chief executive officer of PPD. "With the filing of the dapoxetine NDA, strong new business wins and the opening of the new Phase I clinic in Austin, Texas, PPD is off to a solid start for 2005."
As a leading global provider of discovery and development services and products for pharmaceutical, biotechnology and medical device companies, PPD applies innovative technologies, therapeutic expertise and a commitment to quality to help clients maximize the return on their R&D investments. With proven early discovery through post-market resources, the company also offers compound partnering opportunities. PPD has more than 7,100 professionals in 28 countries around the world. For more information on PPD , visit our Web site at http://www.ppdi.com.
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|Publication:||Biotech Financial Reports|
|Date:||Jun 1, 2005|
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