PRINCETON, N.J., Feb. 22, 2012 /PRNewswire/ – Next Inning Technology Research (http://www.nextinning.com), an online investment newsletter focused on semiconductor and technology stocks, has published updated outlooks on First Solar (Nasdaq: FSLR – News), Trina Solar (NYSE: TSL – News), Yingli Green Energy (NYSE: YGE – News), Hewlett-Packard (NYSE: HPQ – News), and Marvell Technology Group (Nasdaq: MRVL – News).
Next Inning readers leverage the insight you can only get from an industry insider. Next Inning editor Paul McWilliams was a tech industry executive for more than two decades. Not only does he know how things work from the inside and how to spot a winning business model, he also has a long and successful record of picking winning stocks. Year to date in 2012 these picks have driven a 24% gain for the Next Inning Model Portfolio. Since its inception in 2002, the model portfolio is up over 300%.
McWilliams‘ latest reports have the tech world buzzing. Recently, he covered Apple suppliers most likely to leverage the tech giant’s huge success, while warning investors about selected companies that may not always be able to count on Apple’s business. McWilliams has also put out a new report covering a massive, potentially paradigm-shifting project by Google that will see the search giant roll out ultra-fast internet service, making winners out of select suppliers and posing a big threat to incumbent firms. These reports are essential reading, unavailable except via free trial subscription to Next Inning.
To get ahead of the Wall Street curve, you are invited to take a free, 21-day, no obligation trial with Next Inning. For full details on this offer, please visit the following link:
https://www.nextinning.com/subscribe/index.php?refer=prn1368
McWilliams covers these topics and more in his recent reports:
– After advising Next Inning subscribers to exit First Solar in April 2010 when it was trading above $130, does McWilliams see opportunities in the sector among names like First Solar, Trina and Yingli? Does McWilliams trust the rally that the solar sector has experienced this year, or should investors be cautious and lock in profits? What is the primary challenge when it comes to investing in the “solar economy?” Why does China have many reasons to fund solar initiatives as compared to the U.S.?
– McWilliams suggested selling HP in late 2010 when the stock was trading at $43.50. Now that HP has hired Meg Whitman to run the show, does he think it’s time to buy back in? What other aspects of the HP story does McWilliams think investors need to evaluate carefully before making a final buy decision?
– Does McWilliams view the impact on Marvell from flooding in Thailand to be just a short-term issue for the stock? Is Marvell’s current valuation unrealistic when considering its growth potential? What is McWilliams’ fair value estimate for Marvell and how much upside does it represent from current prices?
Founded in September 2002, Next Inning’s model portfolio has returned 305% since its inception versus 50% for the S&P 500.
About Next Inning:
Next Inning is a subscription-based investment newsletter that provides regular coverage on more than 150 technology and semiconductor stocks. Subscribers receive intra-day analysis, commentary and recommendations, as well as access to monthly semiconductor sales analysis, regular Special Reports, and the Next Inning model portfolio. Editor Paul McWilliams is a 30+ year semiconductor industry veteran.
NOTE: This release was published by Indie Research Advisors, LLC, a registered investment advisor with CRD #131926. Interested parties may visit adviserinfo.sec.gov for additional information. Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
CONTACT: Marcia Martin, Next Inning Technology Research, +1-888-278-5515
http://tourism9.com http://vkins.com
2012年2月22日星期三
2012年2月13日星期一
Remedent Announces Strategic Investment by IDG-Accel
GHENT, BELGIUM–(Marketwire -02/13/12)- Remedent, Inc. (“Remedent” or the “Company”) (OTC.BB: REMI.OB – News), an international company specializing in research, development, and the manufacturing of oral care and cosmetic products, announced today the closing of a strategic financing with IDG-Accel China Growth Fund III L.P. (“IDG-Accel Fund”), IDG-Accel China III Investors L.P. (“IDG-Accel Investors Fund”), Crown Link Group Limited (“Crown Link”) (IDG-Accel Fund, IDG-Accel Investors Fund and Crown Link collectively referred to as the “IDG-Accel Investors”) and GlamSmile Dental Technologies Ltd. (“GlamSmile Asia”), an entity in which Remedent owns approximately 29%. On February 10, 2012 the IDG-Accel Investors acquired a 31.4% equity stake in GlamSmile Asia for $7 million in cash. As a result of the strategic investment, Remedent owns 29.4% of GlamSmile Asia while IDG-Accel Investors and Gallant Network Limited (“Gallant”), a BVI-based entity owned and controlled by GlamSmile’s CEO David Lok, own 31.4% and 39.2%, respectively. Both GlamSmile Asia and Remedent plan to use the proceeds from the financing to open new GlamSmile dental clinics in China and to invest in new cutting edge dental technologies repectively.
The details of the transaction are as follows:
1. IDG-Accel Investors acquired 11.4% ownership interest of GlamSmile Asia from Remedent for $2,000,000.
2. IDG-Accel Investors directly acquired 20% ownership interest of GlamSmile Asia for $5,000,000.
3. Mr. Hugo Shong, the Founding Partner of IDG Capital Partners, was appointed to the board of directors of GlamSmile Asia to serve on the board with Mr. Guy De Vreese and Mr. David Lok
IDG-Accel Fund, a prominent private equity investment firm managed by IDG Capital Partners, is a joint venture between media giant International Data Group and venture capital firm Accel Partners. IDG, a media firm that has invested in China since the early 1990s, has benefited from its early presence in China. And Accel, the first venture firm to invest serious capital into Facebook, brings its Silicon Valley expertise to the table. Since 1992, IDG Capital Partners has invested in over 200 emerging growth companies such as Baidu, Sohu, Soufun, Ctrip, and Kanghui. GlamSmile Asia believes that IDG’s involvement will provide its expertise and relationships to help GlamSmile Asia improve operational efficiencies, find strategic partners, accelerate growth in Asia, and overcome regulatory hurdles.
GlamSmile Asia intends to use the proceeds from this investment to open several directly owned clinics in China, and Remedent plans to launch it ex-China GlamSmile franchise clinic expansion, and develop new dental technologies.
“We could not be happier with our strategic relationship with IDG,” said Mr. Guy De Vreese, Chairman and CEO of Remedent. “An investment from a trusted and experienced investor like IDG significantly enhances our profile and resources in China and validates the significant value in both GlamSmile Asia and Remedent branded technologies. We look forward to working with Mr. Shong, founding partner of IDG, and his talented team to further expand our dental business in China.”
About Remedent
Remedent, Inc. specializes in the research, development and manufacturing and the marketing of oral care and cosmetic dental products. The Company serves the professional dental industry with breakthrough technology for dental veneers. These products are supported by a line of professional veneer whitening and tooth sensitivity solutions. Headquartered in Belgium, Remedent distributes its products to more than 55 countries in the worldwide. For more information, go to www.remedent.com.
About IDG
IDG-Accel Fund is a private equity investment fund formed in limited partnership in the Cayman Islands. The Fund focuses on investment in various sectors, such as TMT, medicare, consumer, energy, and others. The Fund is managed by IDG Capital Partners, a leading investment management team in China with over 18-years of investment experience and industry knowledge, who was among the first to introduce foreign venture capital investment into China in early 1990s and has since then invested in around 200 successful portfolios, such as Baidu, Sohu, Tencent, Soufun, Ctrip, Home Inns, Hanting, Kanghui and etc. Over 60 of its portfolios have successfully completed IPO or M&A.
About MZ Group
MZ Group (www.mz-ir.com) is a wholly owned subsidiary of @titude Global (www.attitude-global.com) in North America. MZ Group is the world’s largest independent global investor relations and corporate communications firm, providing innovative, customized services to domestic and multinational companies through a unique, fully integrated “one-stop-shop” business model. With offices in New York, Chicago, San Diego, São Paulo, Beijing, Shanghai, Hong Kong and Taipei, MZ Group has 300+ professionals serving more than 530 clients located throughout 10 countries.
Forward-Looking Statements
Statements in this press release that are “forward-looking statements” are based on current expectations and assumptions that are subject to risks and uncertainties. Such forward-looking statements involve known and unknown risks, uncertainties and other unknown factors that could cause Remedent’s actual operating results to be materially different from any historical results or from any future results expressed or implied by such forward-looking statements. In addition to statements that explicitly describe these risks and uncertainties, readers are urged to consider statements that contain terms such as “believes,” “belief,” “expects,” “expect,” “intends,” “intend,” “anticipate,” “anticipates,” “plans,” “plan,” “projects,” “project,” to be uncertain and forward-looking. Actual results could differ materially because of factors such as Remedent’s ability to achieve the synergies and value creation contemplated by the recent financing and proposed business plans. For further information regarding risks and uncertainties associated with Remedent’s business, please refer to the risk factors described in Remedent’s filings with the Securities and Exchange Commission, including, but not limited to, its annual report on Form 10-K and quarterly reports on Form 10-Q. We undertake no duty to revise or update any forward-looking statements to reflect events or circumstances after the date of this press release.
http://tourism9.cm/ http://vkins.com/
The details of the transaction are as follows:
1. IDG-Accel Investors acquired 11.4% ownership interest of GlamSmile Asia from Remedent for $2,000,000.
2. IDG-Accel Investors directly acquired 20% ownership interest of GlamSmile Asia for $5,000,000.
3. Mr. Hugo Shong, the Founding Partner of IDG Capital Partners, was appointed to the board of directors of GlamSmile Asia to serve on the board with Mr. Guy De Vreese and Mr. David Lok
IDG-Accel Fund, a prominent private equity investment firm managed by IDG Capital Partners, is a joint venture between media giant International Data Group and venture capital firm Accel Partners. IDG, a media firm that has invested in China since the early 1990s, has benefited from its early presence in China. And Accel, the first venture firm to invest serious capital into Facebook, brings its Silicon Valley expertise to the table. Since 1992, IDG Capital Partners has invested in over 200 emerging growth companies such as Baidu, Sohu, Soufun, Ctrip, and Kanghui. GlamSmile Asia believes that IDG’s involvement will provide its expertise and relationships to help GlamSmile Asia improve operational efficiencies, find strategic partners, accelerate growth in Asia, and overcome regulatory hurdles.
GlamSmile Asia intends to use the proceeds from this investment to open several directly owned clinics in China, and Remedent plans to launch it ex-China GlamSmile franchise clinic expansion, and develop new dental technologies.
“We could not be happier with our strategic relationship with IDG,” said Mr. Guy De Vreese, Chairman and CEO of Remedent. “An investment from a trusted and experienced investor like IDG significantly enhances our profile and resources in China and validates the significant value in both GlamSmile Asia and Remedent branded technologies. We look forward to working with Mr. Shong, founding partner of IDG, and his talented team to further expand our dental business in China.”
About Remedent
Remedent, Inc. specializes in the research, development and manufacturing and the marketing of oral care and cosmetic dental products. The Company serves the professional dental industry with breakthrough technology for dental veneers. These products are supported by a line of professional veneer whitening and tooth sensitivity solutions. Headquartered in Belgium, Remedent distributes its products to more than 55 countries in the worldwide. For more information, go to www.remedent.com.
About IDG
IDG-Accel Fund is a private equity investment fund formed in limited partnership in the Cayman Islands. The Fund focuses on investment in various sectors, such as TMT, medicare, consumer, energy, and others. The Fund is managed by IDG Capital Partners, a leading investment management team in China with over 18-years of investment experience and industry knowledge, who was among the first to introduce foreign venture capital investment into China in early 1990s and has since then invested in around 200 successful portfolios, such as Baidu, Sohu, Tencent, Soufun, Ctrip, Home Inns, Hanting, Kanghui and etc. Over 60 of its portfolios have successfully completed IPO or M&A.
About MZ Group
MZ Group (www.mz-ir.com) is a wholly owned subsidiary of @titude Global (www.attitude-global.com) in North America. MZ Group is the world’s largest independent global investor relations and corporate communications firm, providing innovative, customized services to domestic and multinational companies through a unique, fully integrated “one-stop-shop” business model. With offices in New York, Chicago, San Diego, São Paulo, Beijing, Shanghai, Hong Kong and Taipei, MZ Group has 300+ professionals serving more than 530 clients located throughout 10 countries.
Forward-Looking Statements
Statements in this press release that are “forward-looking statements” are based on current expectations and assumptions that are subject to risks and uncertainties. Such forward-looking statements involve known and unknown risks, uncertainties and other unknown factors that could cause Remedent’s actual operating results to be materially different from any historical results or from any future results expressed or implied by such forward-looking statements. In addition to statements that explicitly describe these risks and uncertainties, readers are urged to consider statements that contain terms such as “believes,” “belief,” “expects,” “expect,” “intends,” “intend,” “anticipate,” “anticipates,” “plans,” “plan,” “projects,” “project,” to be uncertain and forward-looking. Actual results could differ materially because of factors such as Remedent’s ability to achieve the synergies and value creation contemplated by the recent financing and proposed business plans. For further information regarding risks and uncertainties associated with Remedent’s business, please refer to the risk factors described in Remedent’s filings with the Securities and Exchange Commission, including, but not limited to, its annual report on Form 10-K and quarterly reports on Form 10-Q. We undertake no duty to revise or update any forward-looking statements to reflect events or circumstances after the date of this press release.
http://tourism9.cm/ http://vkins.com/
2012年2月1日星期三
NI Technology Previews Earnings for Inphi, Intersil, Qualcomm, Acme Packet, and Benchmark Electronics
PRINCETON, N.J., Feb. 1, 2012 /PRNewswire/ – Next Inning Technology Research (http://www.nextinning.com), an online investment newsletter focused on semiconductor and technology stocks, has published a new special report updating outlooks on Inphi (NYSE: IPHI – News), Intersil (Nasdaq: ISIL – News), Qualcomm (Nasdaq: QCOM – News), Acme Packet (Nasdaq: APKT – News), and Benchmark Electronics (NYSE: BHE – News).
Next Inning readers leverage the insight you can only get from an industry insider. Next Inning editor Paul McWilliams was a tech industry executive for more than two decades. Not only does he know how things work from the inside and how to spot a winning business model, he also has a long and successful record of picking winning stocks.
Trial subscribers will receive access to McWilliams’ recent 15-page State of Tech report covering what he calls “Ecosystem” companies. This report provides extensive coverage of Apple, Dell and Hewlett-Packard including 11 tables providing detailed fundamental and valuation data. The ecosystem report is a part of Next Inning’s quarterly State of Tech reports with data collected from more than 60 leading technology companies as well as inputs from a worldwide network of field contacts. Each of the reports focuses on a specific tech sector and includes McWilliams’ in depth analysis, price objectives and company-specific outlooks for 2012 and beyond.
Next Inning trial subscribers now have a rare opportunity to gain access to these valuable reports filled with actionable ideas on over five dozen stocks, via a free, no-strings-attached, trial subscription.
To take advantage of this offer and receive these reports for free, please visit the following link:
https://www.nextinning.com/subscribe/index.php?refer=prn1355
Trial subscribers will also receive McWilliams’ regular commentary and real-time trade alerts in his Next Inning model portfolio, which is already up 20% year to date.
McWilliams covers these topics and more in his recent reports:
– With Inphi shares up sharply from where they bottomed last summer, do investors still have a good opportunity to get in on this unique growth story at a bargain price? What advantages does Inphi technology have over the technology being promoted by NetList? Why did Inphi rally following Intel’s earnings report? Does McWilliams believe the stock could soon trade above $20? Should investors wait until after Inphi reports earnings before buying?
– What big mistakes did Intersil make in the last couple of years that are now keeping a lid on its stock price? Is a buyout of the company the best thing that Intersil investors can hope for right now or is Intersil in the early stages of a strong turnaround story that will benefit investors more than a buy out? How safe is Intersil’s generous dividend?
– What fairly unique complication do investors need to consider when looking at Qualcomm’s balance sheet to correctly assess its value? Following a dip from its highs in 2011, is Qualcomm now trading at an attractive price? Will Qualcomm break through the $60 barrier in 2012? What stock does it make sense to pair with Qualcomm to capture the emerging market portion of the smartphone sector?
– McWilliams advised readers months before Acme Packet lowered its outlook for Q4 that investors should expect companies like Acme to struggle during Q4 due to cutbacks in spending by U.S. service providers like AT&T and Verizon. Does he see this situation improving in 2012? What other drivers does he see for Acme Packet this year? With Acme Packet still trading at depressed levels, is it time for investors to pick up shares ahead of a possible rebound?
– Despite a poor performance by Benchmark in 2011, are there signs that the company is poised for a turnaround in 2012? What two potential factors could drive Benchmark’s earnings notably above expectations in 2012? Which stock in the contract manufacturing sector does McWilliams recommend pairing with Benchmark? What does McWilliams see as an estimated fair value target for Benchmark?
Founded in September 2002, Next Inning’s model portfolio has returned 295% since its inception versus 45% for the S&P 500.
About Next Inning:
Next Inning is a subscription-based investment newsletter that provides regular coverage on more than 150 technology and semiconductor stocks. Subscribers receive intra-day analysis, commentary and recommendations, as well as access to monthly semiconductor sales analysis, regular Special Reports, and the Next Inning model portfolio. Editor Paul McWilliams is a 30+ year semiconductor industry veteran.
NOTE: This release was published by Indie Research Advisors, LLC, a registered investment advisor with CRD #131926. Interested parties may visit adviserinfo.sec.gov for additional information. Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
CONTACT: Marcia Martin, Next Inning Technology Research, +1-888-278-5515http://tourism9.com/ http://vkins.com/
Next Inning readers leverage the insight you can only get from an industry insider. Next Inning editor Paul McWilliams was a tech industry executive for more than two decades. Not only does he know how things work from the inside and how to spot a winning business model, he also has a long and successful record of picking winning stocks.
Trial subscribers will receive access to McWilliams’ recent 15-page State of Tech report covering what he calls “Ecosystem” companies. This report provides extensive coverage of Apple, Dell and Hewlett-Packard including 11 tables providing detailed fundamental and valuation data. The ecosystem report is a part of Next Inning’s quarterly State of Tech reports with data collected from more than 60 leading technology companies as well as inputs from a worldwide network of field contacts. Each of the reports focuses on a specific tech sector and includes McWilliams’ in depth analysis, price objectives and company-specific outlooks for 2012 and beyond.
Next Inning trial subscribers now have a rare opportunity to gain access to these valuable reports filled with actionable ideas on over five dozen stocks, via a free, no-strings-attached, trial subscription.
To take advantage of this offer and receive these reports for free, please visit the following link:
https://www.nextinning.com/subscribe/index.php?refer=prn1355
Trial subscribers will also receive McWilliams’ regular commentary and real-time trade alerts in his Next Inning model portfolio, which is already up 20% year to date.
McWilliams covers these topics and more in his recent reports:
– With Inphi shares up sharply from where they bottomed last summer, do investors still have a good opportunity to get in on this unique growth story at a bargain price? What advantages does Inphi technology have over the technology being promoted by NetList? Why did Inphi rally following Intel’s earnings report? Does McWilliams believe the stock could soon trade above $20? Should investors wait until after Inphi reports earnings before buying?
– What big mistakes did Intersil make in the last couple of years that are now keeping a lid on its stock price? Is a buyout of the company the best thing that Intersil investors can hope for right now or is Intersil in the early stages of a strong turnaround story that will benefit investors more than a buy out? How safe is Intersil’s generous dividend?
– What fairly unique complication do investors need to consider when looking at Qualcomm’s balance sheet to correctly assess its value? Following a dip from its highs in 2011, is Qualcomm now trading at an attractive price? Will Qualcomm break through the $60 barrier in 2012? What stock does it make sense to pair with Qualcomm to capture the emerging market portion of the smartphone sector?
– McWilliams advised readers months before Acme Packet lowered its outlook for Q4 that investors should expect companies like Acme to struggle during Q4 due to cutbacks in spending by U.S. service providers like AT&T and Verizon. Does he see this situation improving in 2012? What other drivers does he see for Acme Packet this year? With Acme Packet still trading at depressed levels, is it time for investors to pick up shares ahead of a possible rebound?
– Despite a poor performance by Benchmark in 2011, are there signs that the company is poised for a turnaround in 2012? What two potential factors could drive Benchmark’s earnings notably above expectations in 2012? Which stock in the contract manufacturing sector does McWilliams recommend pairing with Benchmark? What does McWilliams see as an estimated fair value target for Benchmark?
Founded in September 2002, Next Inning’s model portfolio has returned 295% since its inception versus 45% for the S&P 500.
About Next Inning:
Next Inning is a subscription-based investment newsletter that provides regular coverage on more than 150 technology and semiconductor stocks. Subscribers receive intra-day analysis, commentary and recommendations, as well as access to monthly semiconductor sales analysis, regular Special Reports, and the Next Inning model portfolio. Editor Paul McWilliams is a 30+ year semiconductor industry veteran.
NOTE: This release was published by Indie Research Advisors, LLC, a registered investment advisor with CRD #131926. Interested parties may visit adviserinfo.sec.gov for additional information. Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
CONTACT: Marcia Martin, Next Inning Technology Research, +1-888-278-5515http://tourism9.com/ http://vkins.com/
2012年1月27日星期五
Covance Reports Fourth Quarter Revenue of $532M, GAAP EPS of $0.35, Pro Forma EPS of $0.73, and Adjusted Net Orders of …
PRINCETON, N.J., Jan. 25, 2012 /PRNewswire/ — Covance Inc. (NYSE: CVD – News) today reported GAAP earnings for its fourth quarter ended December 31, 2011 of $0.35 per diluted share. Included in fourth quarter results is approximately $0.41 per diluted share in charges, approximately $0.10 of which relates to the completion of the previously-announced restructuring actions, approximately $0.11 of which relates to the termination of a research products inventory supply agreement and inventory write down, and approximately $0.20 for the impairment of a related equity investment, partially offset by a gain of approximately $0.03 from favorable income tax developments in the quarter. Excluding these items, diluted earnings per share for the fourth quarter ended December 31, 2011 was $0.73. For the full year, diluted earnings per share were $2.16 inclusive of $0.58 per share in charges, partially offset by a gain of approximately $0.04 from favorable income tax developments during the year. Excluding these items, diluted earnings per share for the year ended December 31, 2011 was $2.70.
“During 2011, Covance increased revenue by 8.8% to $2.1 billion, improved pro forma operating margin by 70 basis points (when excluding charges in both periods), and drove pro forma EPS growth of 26% to $2.70 per diluted share. In addition, adjusted net orders for the year were a record $2.53 billion, a year-on-year increase of 13.5%, resulting in a strong adjusted net book-to-bill of 1.21 to 1 for the year,” said Joe Herring, Chairman and Chief Executive Officer. ”For the fourth quarter, consolidated revenues grew 8.3% and pro forma operating margin expanded by 130 basis points year-on-year and 50 basis points sequentially to 10.9%.
“In Early Development, fourth quarter net revenues grew 6.3% year-on-year, but declined $5.7 million sequentially due to lower demand in research products and European toxicology services, as well as a $2.3 million foreign exchange headwind. Early Development pro forma operating margin (when excluding charges in all periods), increased 190 basis points year-on-year to 13.9%, but did not expand sequentially as we had forecasted due primarily to operating losses incurred in research products this quarter. This lower demand for our research products caused us to reassess inventory levels and the fair value of an equity investment in a supplier. In Late-Stage Development, net revenues grew 10.0% year-on-year driven by the continued strong performance in our clinical development services. Pro forma operating margin of 20.0% exceeded our expectations due to increased profitability in our central laboratory, which grew revenues sequentially on a constant currency basis for the second consecutive quarter.
“On the commercial front, adjusted net orders in the fourth quarter were a record $759 million, representing an adjusted book-to-bill of 1.42 to 1. We were particularly pleased to see continued strong orders in clinical development and a further increase in orders in our central laboratory for the second consecutive quarter. The ongoing strength of our service portfolio, as evidenced by our strong 2011 orders, gives us confidence to continue our investments to drive future growth.
“Looking ahead, we are making strategic investments in our information technology infrastructure and applications to increase the productivity of our drug development services, drive operating efficiencies, and arrest the long-term rate of growth of our information technology spending. In addition to the implementation of our central laboratory system, which we previously disclosed as a $10 million incremental spend, we are funding three additional strategic projects to help us achieve these objectives. In total, these four projects will increase our IT capital expenditures to approximately $90 million in 2012 (versus approximately $60 million in 2011), and will lead to a significant increase in operating expense over the next two years. We are also planning to continue expanding our commercial footprint in order to capture an increasing share of the opportunities available in the CRO industry and position us for longer-term growth. In aggregate, we are projecting spending in these areas to be above the growth rate in revenue by approximately $25 million, or $0.32 per diluted share in 2012.
“In the first quarter of 2012, we expect a modest increase in net revenues from the fourth quarter level as we forecast a further sequential decline in Early Development net revenue, to be offset by an increase in Late-Stage net revenues. A drop in Early Development earnings due to the expected lower level of revenue, when combined with the increased information technology spending and foreign exchange headwind, is expected to result in diluted earnings per share in the low $0.60 range.
“For the full year, we are forecasting mid-single digit year-on-year revenue growth (inclusive of an approximate 200 basis point headwind from the stronger USD) and diluted earnings per share in the range of $2.50 to $2.80. This diluted earnings per share range reflects increased investment in IT and commercial, the estimated impact of anticipated share repurchases that may be made under our Board-approved share repurchase programs ($0.15 to $0.20 per share), excludes potential new strategic alliances with clients, and assumes foreign exchange rates remain at year-end 2011 levels.”
Consolidated Results
* See attached pro forma income statements for reconciliation of GAAP to pro forma amounts.
Operating Segment Results
Early Development
The Early Development segment includes preclinical toxicology, analytical chemistry, clinical pharmacology, discovery support, and research products. Net revenues in the fourth quarter of 2011 grew 6.3% year-on-year to $234.5 million, driven by the results from our new Alnwick, UK and Porcheville, France sites and clinical pharmacology. On a sequential basis, revenues declined $5.7 million due to lower demand in research products and European toxicology services, as well as a $2.3 million foreign exchange headwind. North American toxicology experienced modest year-on-year growth and was flat sequentially.
GAAP operating income for the fourth quarter of 2011 was $17.7 million, and included $4.7 million in charges relating to our previously announced restructuring activities as well as $10.3 million in charges associated with lower demand for our research products (costs to terminate a product supply agreement and inventory write-down). Pro forma operating income, excluding charges in all periods, was $32.6 million in the current quarter, compared to $35.0 million last quarter and $26.6 million in the fourth quarter of last year. The primary driver of the sequential decline in pro forma operating income was the loss we incurred in our research products operation from lower demand, as previously discussed. Pro forma operating margins, excluding charges in all periods, were 13.9% for the fourth quarter, compared to 14.6% last quarter and 12.0% in the fourth quarter of 2010.
Late-Stage Development
The Late-Stage Development segment includes central laboratory, Phase II-IV clinical development, and market access services. Net revenues for the fourth quarter of 2011 grew 10.0% year-on-year to $298.0 million, primarily driven by the continued strong performance in clinical development and a 190 basis point tailwind in foreign exchange. On a sequential basis, revenues declined $5.0 million due to a $10.1 million foreign exchange headwind, which more than offset growth across the segment’s service offerings, at constant exchange rates.
GAAP operating income for the fourth quarter was $58.2 million and included $1.3 million in costs associated with our restructuring actions. Pro forma operating income, excluding these costs, was $59.5 million, compared to $58.4 million last quarter and $54.7 million in the fourth quarter of the prior year. Pro forma operating margins, excluding these costs, were 20.0% for the fourth quarter of 2011 compared to 19.3% last quarter and 20.2% in the fourth quarter of last year. The sequential increase in profitability was primarily due to stronger central laboratory performance.
Corporate Information
The Company’s backlog at December 31, 2011 was $6.14 billion compared to $6.08 billion at September 30, 2011 and $6.19 billion at December 31, 2010. Foreign exchange negatively impacted sequential backlog growth by $75 million.
Corporate expenses totaled $37.0 million in the fourth quarter of 2011 (including $2.7 million in restructuring costs) compared to $38.4 million last quarter (including $1.4 million in restructuring costs) and $39.9 million in the fourth quarter of last year.
During the fourth quarter, the company recorded a $12.1 million charge to recognize an impairment in the carrying value of an equity investment in a supplier of research products. This charge is reflected as a component of other income (expense) in the consolidated statements of income.
Cash and cash equivalents at December 31, 2011 were $389 million compared to $400 million at September 30, 2011 and $377 million at December 31, 2010. Covance repaid $60 million in debt during the quarter and now has $30.0 million in debt outstanding, originating from borrowings related to the fourth quarter 2010 accelerated share repurchase.
Free cash flow (defined as operating cash flow less capital expenditures) for the fourth quarter of 2011 was $54 million, consisting of operating cash flow of $102 million less capital expenditures of $48 million. Free cash flow for the full year was $109 million, consisting of operating cash flow of $243 million less capital expenditures of $135 million. We expect 2012 capital spending to be approximately $180 million.
Net Days Sales Outstanding (DSO) were 38 days at December 31, 2011 compared to 38 days at September 30, 2011 and 31 days at December 31, 2010.
The Company’s investor conference call will be webcast on January 26 at 9:00 am ET. Management’s commentary and presentation slides will be available through www.covance.com.
Covance, with headquarters in Princeton, New Jersey, is one of the world’s largest and most comprehensive drug development services companies with annual revenues greater than $2 billion, global operations in more than 30 countries, and more than 11,000 employees worldwide. Information on Covance’s products and services, recent press releases, and SEC filings can be obtained through its website at www.covance.com.
Statements contained in this press release, which are not historical facts, such as statements about prospective earnings, savings, revenue, operations, revenue and earnings growth and other financial results are forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All such forward-looking statements including the statements contained herein regarding anticipated trends in the Company’s business are based largely on management’s expectations and are subject to and qualified by risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. These risks and uncertainties include, without limitation, competitive factors, outsourcing trends in the pharmaceutical industry, levels of industry research and development spending, the Company’s ability to continue to attract and retain qualified personnel, the fixed price nature of contracts or the loss or delay of large studies, risks associated with acquisitions and investments, the Company’s ability to increase order volume, the pace of translation of orders into revenue in late-stage development services, testing mix and geographic mix of kit receipts in central laboratories, fluctuations in currency exchange rates, the price and rate at which the company executes its share repurchase program, the cost and pace of completion of our information technology projects and the realization of benefits therefrom, and other factors described in the Company’s filings with the Securities and Exchange Commission including its Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. The Company undertakes no duty to update any forward looking statement to conform the statement to actual results or changes in the Company’s expectations.
Financial Exhibits Follow
http://tourism9.com/ http://vkins.com/
“During 2011, Covance increased revenue by 8.8% to $2.1 billion, improved pro forma operating margin by 70 basis points (when excluding charges in both periods), and drove pro forma EPS growth of 26% to $2.70 per diluted share. In addition, adjusted net orders for the year were a record $2.53 billion, a year-on-year increase of 13.5%, resulting in a strong adjusted net book-to-bill of 1.21 to 1 for the year,” said Joe Herring, Chairman and Chief Executive Officer. ”For the fourth quarter, consolidated revenues grew 8.3% and pro forma operating margin expanded by 130 basis points year-on-year and 50 basis points sequentially to 10.9%.
“In Early Development, fourth quarter net revenues grew 6.3% year-on-year, but declined $5.7 million sequentially due to lower demand in research products and European toxicology services, as well as a $2.3 million foreign exchange headwind. Early Development pro forma operating margin (when excluding charges in all periods), increased 190 basis points year-on-year to 13.9%, but did not expand sequentially as we had forecasted due primarily to operating losses incurred in research products this quarter. This lower demand for our research products caused us to reassess inventory levels and the fair value of an equity investment in a supplier. In Late-Stage Development, net revenues grew 10.0% year-on-year driven by the continued strong performance in our clinical development services. Pro forma operating margin of 20.0% exceeded our expectations due to increased profitability in our central laboratory, which grew revenues sequentially on a constant currency basis for the second consecutive quarter.
“On the commercial front, adjusted net orders in the fourth quarter were a record $759 million, representing an adjusted book-to-bill of 1.42 to 1. We were particularly pleased to see continued strong orders in clinical development and a further increase in orders in our central laboratory for the second consecutive quarter. The ongoing strength of our service portfolio, as evidenced by our strong 2011 orders, gives us confidence to continue our investments to drive future growth.
“Looking ahead, we are making strategic investments in our information technology infrastructure and applications to increase the productivity of our drug development services, drive operating efficiencies, and arrest the long-term rate of growth of our information technology spending. In addition to the implementation of our central laboratory system, which we previously disclosed as a $10 million incremental spend, we are funding three additional strategic projects to help us achieve these objectives. In total, these four projects will increase our IT capital expenditures to approximately $90 million in 2012 (versus approximately $60 million in 2011), and will lead to a significant increase in operating expense over the next two years. We are also planning to continue expanding our commercial footprint in order to capture an increasing share of the opportunities available in the CRO industry and position us for longer-term growth. In aggregate, we are projecting spending in these areas to be above the growth rate in revenue by approximately $25 million, or $0.32 per diluted share in 2012.
“In the first quarter of 2012, we expect a modest increase in net revenues from the fourth quarter level as we forecast a further sequential decline in Early Development net revenue, to be offset by an increase in Late-Stage net revenues. A drop in Early Development earnings due to the expected lower level of revenue, when combined with the increased information technology spending and foreign exchange headwind, is expected to result in diluted earnings per share in the low $0.60 range.
“For the full year, we are forecasting mid-single digit year-on-year revenue growth (inclusive of an approximate 200 basis point headwind from the stronger USD) and diluted earnings per share in the range of $2.50 to $2.80. This diluted earnings per share range reflects increased investment in IT and commercial, the estimated impact of anticipated share repurchases that may be made under our Board-approved share repurchase programs ($0.15 to $0.20 per share), excludes potential new strategic alliances with clients, and assumes foreign exchange rates remain at year-end 2011 levels.”
Consolidated Results
| ($ in millions except EPS) | 4Q11 | 4Q10 | Change | FY 2011 | FY 2010 | Change | |
| Total Revenues | $582.4 | $519.5 | $2,236.4 | $2,038.5 | |||
| Less: Reimbursable Out-of-Pockets | $49.9 | $28.0 | $140.5 | $112.9 | |||
| Net Revenues | $532.5 | $491.5 | 8.3% | $2,095.9 | $1,925.6 | 8.8% | |
| Operating Income | $39.0 | $28.9 | 35.0% | $180.6 | $47.5 | 280.3% | |
| Net Income | $21.1 | $28.4 | (25.5%) | $132.2 | $68.3 | 93.7% | |
| Earnings Per Share | $0.35 | $0.45 | (23.6%) | $2.16 | $1.06 | 104.3% | |
| 2011 Charges* | ($31.1) | - | ($46.8) | - | |||
| 2010 Charges* | - | ($18.4) | - | ($137.6) | |||
| Favorable Income Tax items* | $1.8 | $6.9 | $2.5 | $17.3 | |||
| Operating Income, excluding items* | $57.9 | $47.2 | 22.6% | $215.3 | $185.1 | 16.3% | |
| Operating Margin %, ex items* | 10.9% | 9.6% | 10.3% | 9.6% | |||
| Net Income, excluding items* | $44.6 | $35.1 | 26.9% | $165.0 | $138.6 | 19.1% | |
| Diluted EPS, excluding items* | $0.73 | $0.56 | 30.4% | $2.70 | $2.15 | 25.7% | |
Operating Segment Results
Early Development
| ($ in millions) | 4Q11 | 4Q10 | Change | FY 2011 | FY 2010 | Change | |
| Net Revenues | $234.5 | $220.6 | 6.3% | $930.6 | $840.3 | 10.7% | |
| GAAP Operating Income (Loss) | $17.7 | $21.1 | (16.3%) | $105.3 | ($32.0) | - | |
| GAAP Operating Margin % | 7.5% | 9.6% | 11.3% | (3.8%) | |||
| 2011 Charges | ($15.0) | - | ($21.7) | - | |||
| 2010 Charges | - | ($5.4) | - | ($124.6) | |||
| 2010 Cost Actions | - | - | - | ($8.0) | |||
| Pro Forma Operating Income | $32.6 | $26.6 | 22.8% | $127.0 | $100.7 | 26.1% | |
| Pro Forma OM% | 13.9% | 12.0% | 13.7% | 12.0% | |||
GAAP operating income for the fourth quarter of 2011 was $17.7 million, and included $4.7 million in charges relating to our previously announced restructuring activities as well as $10.3 million in charges associated with lower demand for our research products (costs to terminate a product supply agreement and inventory write-down). Pro forma operating income, excluding charges in all periods, was $32.6 million in the current quarter, compared to $35.0 million last quarter and $26.6 million in the fourth quarter of last year. The primary driver of the sequential decline in pro forma operating income was the loss we incurred in our research products operation from lower demand, as previously discussed. Pro forma operating margins, excluding charges in all periods, were 13.9% for the fourth quarter, compared to 14.6% last quarter and 12.0% in the fourth quarter of 2010.
Late-Stage Development
| ($ in millions) | 4Q11 | 4Q10 | Change | FY 2011 | FY 2010 | Change | |
| Net Revenues | $298.0 | $270.9 | 10.0% | $1,165.4 | $1,085.3 | 7.4% | |
| GAAP Operating Income | $ 58.2 | $47.6 | 22.3% | $226.3 | $225.5 | 0.4% | |
| GAAP Operating Margin % | 19.5% | 17.6% | 19.4% | 20.8% | |||
| 2011 Charges | ($1.3) | - | ($5.0) | - | |||
| 2010 Charges | - | ($7.1) | - | ($7.1) | |||
| 2010 Cost Actions | - | - | - | ($0.2) | |||
| Pro Forma Operating Income | $59.5 | $ 54.7 | 8.7% | $231.3 | $232.8 | (0.7%) | |
| Pro Forma OM% | 20.0% | 20.2% | 19.8% | 21.5% | |||
GAAP operating income for the fourth quarter was $58.2 million and included $1.3 million in costs associated with our restructuring actions. Pro forma operating income, excluding these costs, was $59.5 million, compared to $58.4 million last quarter and $54.7 million in the fourth quarter of the prior year. Pro forma operating margins, excluding these costs, were 20.0% for the fourth quarter of 2011 compared to 19.3% last quarter and 20.2% in the fourth quarter of last year. The sequential increase in profitability was primarily due to stronger central laboratory performance.
Corporate Information
The Company’s backlog at December 31, 2011 was $6.14 billion compared to $6.08 billion at September 30, 2011 and $6.19 billion at December 31, 2010. Foreign exchange negatively impacted sequential backlog growth by $75 million.
Corporate expenses totaled $37.0 million in the fourth quarter of 2011 (including $2.7 million in restructuring costs) compared to $38.4 million last quarter (including $1.4 million in restructuring costs) and $39.9 million in the fourth quarter of last year.
During the fourth quarter, the company recorded a $12.1 million charge to recognize an impairment in the carrying value of an equity investment in a supplier of research products. This charge is reflected as a component of other income (expense) in the consolidated statements of income.
Cash and cash equivalents at December 31, 2011 were $389 million compared to $400 million at September 30, 2011 and $377 million at December 31, 2010. Covance repaid $60 million in debt during the quarter and now has $30.0 million in debt outstanding, originating from borrowings related to the fourth quarter 2010 accelerated share repurchase.
Free cash flow (defined as operating cash flow less capital expenditures) for the fourth quarter of 2011 was $54 million, consisting of operating cash flow of $102 million less capital expenditures of $48 million. Free cash flow for the full year was $109 million, consisting of operating cash flow of $243 million less capital expenditures of $135 million. We expect 2012 capital spending to be approximately $180 million.
Net Days Sales Outstanding (DSO) were 38 days at December 31, 2011 compared to 38 days at September 30, 2011 and 31 days at December 31, 2010.
The Company’s investor conference call will be webcast on January 26 at 9:00 am ET. Management’s commentary and presentation slides will be available through www.covance.com.
Covance, with headquarters in Princeton, New Jersey, is one of the world’s largest and most comprehensive drug development services companies with annual revenues greater than $2 billion, global operations in more than 30 countries, and more than 11,000 employees worldwide. Information on Covance’s products and services, recent press releases, and SEC filings can be obtained through its website at www.covance.com.
Statements contained in this press release, which are not historical facts, such as statements about prospective earnings, savings, revenue, operations, revenue and earnings growth and other financial results are forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All such forward-looking statements including the statements contained herein regarding anticipated trends in the Company’s business are based largely on management’s expectations and are subject to and qualified by risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. These risks and uncertainties include, without limitation, competitive factors, outsourcing trends in the pharmaceutical industry, levels of industry research and development spending, the Company’s ability to continue to attract and retain qualified personnel, the fixed price nature of contracts or the loss or delay of large studies, risks associated with acquisitions and investments, the Company’s ability to increase order volume, the pace of translation of orders into revenue in late-stage development services, testing mix and geographic mix of kit receipts in central laboratories, fluctuations in currency exchange rates, the price and rate at which the company executes its share repurchase program, the cost and pace of completion of our information technology projects and the realization of benefits therefrom, and other factors described in the Company’s filings with the Securities and Exchange Commission including its Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. The Company undertakes no duty to update any forward looking statement to conform the statement to actual results or changes in the Company’s expectations.
Financial Exhibits Follow
| COVANCE INC. | ||||||||||
| CONSOLIDATED INCOME STATEMENTS | ||||||||||
| FOR THE THREE MONTHS AND YEARS ENDED DECEMBER 31, 2011 AND 2010 | ||||||||||
| (Dollars in thousands, except per share data) | ||||||||||
| Three Months Ended December 31 | Years Ended December 31 | |||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||
| (UNAUDITED) | ||||||||||
| Net revenues | $ 532,478 | $ 491,513 | $ 2,095,938 | $ 1,925,630 | ||||||
| Reimbursable out-of-pocket expenses | 49,907 | 27,942 | 140,508 | 112,843 | ||||||
| Total revenues | 582,385 | 519,455 | 2,236,446 | 2,038,473 | ||||||
| Costs and expenses: | ||||||||||
| Cost of revenue | 371,852 | 346,924 | 1,467,051 | 1,348,498 | ||||||
| Reimbursable out-of-pocket expenses | 49,907 | 27,942 | 140,508 | 112,843 | ||||||
| Selling, general and administrative | 95,752 | 89,810 | 343,044 | 307,386 | ||||||
| Depreciation and amortization | 25,923 | 25,919 | 105,214 | 103,024 | ||||||
| Asset impairment charges | - | - | - | 119,229 | ||||||
| Total costs and expenses | 543,434 | (a) | 490,595 | (d) | 2,055,817 | (c) | 1,990,980 | (e) | ||
| Income from operations | 38,951 | (a) | 28,860 | (d) | 180,629 | (c) | 47,493 | (e) | ||
| Other expense, net: | ||||||||||
| Interest expense, net | 339 | 430 | 1,979 | 52 | ||||||
| Foreign exchange transaction loss, net | 356 | 1,054 | 1,248 | 3,649 | ||||||
| Impairment of equity investment | 12,119 | - | 12,119 | - | ||||||
| Other expense, net | 12,814 | (b) | 1,484 | 15,346 | (b) | 3,701 | ||||
| Income before taxes and equity investee earnings | 26,137 | (a),(b) | 27,376 | (d) | 165,283 | (b),(c) | 43,792 | (e) | ||
| Tax expense (benefit) | 5,172 | (a),(b) | (1,121) | (d) | 33,574 | (b),(c) | (23,655) | (e) | ||
| Equity investee earnings (loss) | 175 | (119) | 480 | 807 | ||||||
| Net income | $ 21,140 | (a),(b) | $ 28,378 | (d) | $ 132,189 | (b),(c) | $ 68,254 | (e) | ||
| Basic earnings per share | $ 0.35 | (a),(b) | $ 0.46 | (d) | $ 2.22 | (b),(c) | $ 1.08 | (e) | ||
| Weighted average shares outstanding – basic | 59,730,270 | 61,390,965 | 59,629,788 | 63,043,561 | ||||||
| Diluted earnings per share | $ 0.35 | (a),(b) | $ 0.45 | (d) | $ 2.16 | (b),(c) | $ 1.06 | (e) | ||
| Weighted average shares outstanding – diluted | 61,080,387 | 62,703,690 | 61,091,354 | 64,472,326 | ||||||
| (a) Includes, as applicable, $8,667 in restructuring costs ($5,961 net of tax), $10,287 in costs associated with the termination of an inventory supply agreement and related inventory write-down ($7,130 net of tax) and favorable income tax items totaling $1,769 during the three months ended December, 2011. | ||||||||||
| (b) Includes $12,119 impairment of equity investment ($12,119 net of tax) during the three and twelve months ended December 31, 2011. | ||||||||||
| (c) Includes, as applicable, $24,369 in restructuring costs ($16,067 net of tax), $10,287 in costs associated with the termination of an inventory supply agreement and related inventory write-down ($7,130 net of tax) and favorable income tax items totaling $2,469 during the year ended December 31, 2011. | ||||||||||
| (d) Includes, as applicable, $18,362 in restructuring costs ($13,688 net of tax) and $6,946 in favorable income tax items during the three months ended December 31, 2010. | ||||||||||
| (e) Includes, as applicable, asset impairment charges ($119,229) and restructuring costs ($18,362) totaling $137,591 ($87,610 net of tax) and favorable income tax items totaling $17,298 during the year ended December 31, 2010. | ||||||||||
| Excluding the impact of restructuring charges, inventory write-down and related charges, the asset impairment charges, the impairment of equity investment and favorable income tax items: | ||||||||||
| Income from operations | $ 57,905 | $ 47,222 | $ 215,285 | $ 185,084 | ||||||
| Taxes on income | $ 12,804 | $ 10,499 | $ 47,502 | $ 43,624 | ||||||
| Net income | $ 44,581 | $ 35,120 | $ 165,036 | $ 138,566 | ||||||
| Basic earnings per share | $ 0.75 | $ 0.57 | $ 2.77 | $ 2.20 | ||||||
| Diluted earnings per share | $ 0.73 | $ 0.56 | $ 2.70 | $ 2.15 | ||||||
| COVANCE INC. | ||||||
| CONSOLIDATED BALANCE SHEETS | ||||||
| DECEMBER 31, 2011 and DECEMBER 31, 2010 | ||||||
| (Dollars in thousands) | ||||||
| December 31 | December 31 | |||||
| 2011 | 2010 | |||||
| ASSETS | ||||||
| Current Assets: | ||||||
| Cash & cash equivalents | $ 389,103 | $ 377,223 | ||||
| Accounts receivable, net | 312,127 | 261,160 | ||||
| Unbilled services | 114,095 | 90,729 | ||||
| Inventory | 74,698 | 82,924 | ||||
| Deferred income taxes | 52,078 | 35,648 | ||||
| Prepaid expenses and other current assets | 144,809 | 98,127 | ||||
| Total Current Assets | 1,086,910 | 945,811 | ||||
| Property and equipment, net | 849,551 | 843,983 | ||||
| Goodwill, net | 127,779 | 127,653 | ||||
| Other assets | 43,768 | 48,095 | ||||
| Total Assets | $ 2,108,008 | $ 1,965,542 | ||||
| LIABILITIES and STOCKHOLDERS’ EQUITY | ||||||
| Current Liabilities: | ||||||
| Accounts payable | $ 36,393 | $ 34,079 | ||||
| Accrued payroll and benefits | 142,229 | 107,572 | ||||
| Accrued expenses and other current liabilities | 119,308 | 97,395 | ||||
| Unearned revenue | 202,210 | 186,301 | ||||
| Short-term debt and current portion of long-term debt | 30,000 | 45,000 | ||||
| Income taxes payable | 6,889 | 28,827 | ||||
| Total Current Liabilities | 537,029 | 499,174 | ||||
| Long-term debt | - | 87,500 | ||||
| Deferred income taxes | 42,295 | 30,531 | ||||
| Other liabilities | 70,889 | 68,516 | ||||
| Total Liabilities | 650,213 | 685,721 | ||||
| Stockholders’ Equity: | ||||||
| Common stock | 781 | 774 | ||||
| Paid-in capital | 689,584 | 639,341 | ||||
| Retained earnings | 1,505,894 | 1,373,705 | ||||
| Accumulated other comprehensive income | 4,622 | 277 | ||||
| Treasury stock | (743,086) | (734,276) | ||||
| Total Stockholders’ Equity | 1,457,795 | 1,279,821 | ||||
| Total Liabilities and Stockholders’ Equity | $ 2,108,008 | $ 1,965,542 | ||||
| COVANCE INC. | |||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||
| FOR THE YEARS ENDED DECEMBER 31, 2011 AND 2010 | |||||
| (Dollars in thousands) | |||||
| Years Ended December 31 | |||||
| 2011 | 2010 | ||||
| Cash flows from operating activities: | |||||
| Net income | $ 132,189 | $ 68,254 | |||
| Adjustments to reconcile net income to net cash provided by | |||||
| operating activities: | |||||
| Depreciation and amortization | 105,214 | 103,024 | |||
| Asset impairment charges | - | 119,229 | |||
| Non-cash compensation expense associated with employee benefit | |||||
| and stock compensation plans | 40,057 | 32,289 | |||
| Deferred income tax benefit | (6,128) | (71,661) | |||
| Impairment of equity investment | 12,119 | - | |||
| Loss on disposal of property and equipment | 1,618 | 1,487 | |||
| Equity investee earnings | (480) | (807) | |||
| Changes in operating assets and liabilities, net of businesses | |||||
| acquired: | |||||
| Accounts receivable | (50,754) | 23,959 | |||
| Unbilled services | (23,366) | 6,550 | |||
| Inventory | 8,226 | (1,998) | |||
| Accounts payable | 2,297 | (2,755) | |||
| Accrued liabilities | 56,409 | 20,097 | |||
| Unearned revenue | 15,909 | 19,411 | |||
| Income taxes payable | (21,070) | 14,797 | |||
| Other assets and liabilities, net | (28,762) | 2,547 | |||
| Net cash provided by operating activities | 243,478 | 334,423 | |||
| Cash flows from investing activities: | |||||
| Capital expenditures | (134,633) | (126,278) | |||
| Acquisition of businesses, net of cash acquired | (411) | (20,994) | |||
| Other, net | 192 | 47 | |||
| Net cash used in investing activities | (134,852) | (147,225) | |||
| Cash flows from financing activities: | |||||
| Net (repayments) borrowings under revolving credit facility | (5,000) | 35,000 | |||
| Borrowings under long-term debt | - | 100,000 | |||
| Repayments under long-term debt | (97,500) | (2,500) | |||
| Stock issued under employee stock purchase and option plans | 9,325 | 18,825 | |||
| Purchase of treasury stock | (8,810) | (256,351) | |||
| Net cash used in financing activities | (101,985) | (105,026) | |||
| Effect of exchange rate changes on cash | 5,239 | 5,582 | |||
| Net change in cash and cash equivalents | 11,880 | 87,754 | |||
| Cash and cash equivalents, beginning of period | 377,223 | 289,469 | |||
| Cash and cash equivalents, end of period | $ 389,103 | $ 377,223 | |||
| COVANCE INC. | ||||||||||
| GAAP to Pro Forma Reconciliation | ||||||||||
| Q4 2011 | ||||||||||
| (Dollars in thousands, except per share data) | ||||||||||
| (UNAUDITED) | ||||||||||
| Adjustments | ||||||||||
| GAAP | Restructuring Activities (1) | Other Charges (2) | Income Tax Items (3) | Pro Forma | ||||||
| Net revenues | $ 532,478 | $ 532,478 | ||||||||
| Reimbursable out-of-pocket expenses | 49,907 | 49,907 | ||||||||
| Total revenues | 582,385 | - | - | - | 582,385 | |||||
| Costs and expenses: | ||||||||||
| Cost of revenue | 371,852 | 371,852 | ||||||||
| Reimbursable out-of-pocket expenses | 49,907 | 49,907 | ||||||||
| Selling, general and administrative | 95,752 | (8,754) | (10,287) | 76,711 | ||||||
| Depreciation and amortization | 25,923 | 87 | 26,010 | |||||||
| Total costs and expenses | 543,434 | (8,667) | (10,287) | - | 524,480 | |||||
| Income from operations | 38,951 | 8,667 | 10,287 | - | 57,905 | |||||
| Other expense (income), net: | ||||||||||
| Interest expense (income), net | 339 | 339 | ||||||||
| Foreign exchange transaction loss, net | 356 | 356 | ||||||||
| Impairment of equity investment | 12,119 | (12,119) | - | |||||||
| Other expense (income), net | 12,814 | - | (12,119) | - | 695 | |||||
| Income before taxes and equity investee earnings | 26,137 | 8,667 | 22,406 | - | 57,210 | |||||
| Tax expense | 5,172 | 2,706 | 3,157 | 1,769 | 12,804 | |||||
| Equity investee earnings | 175 | 175 | ||||||||
| Net income | $ 21,140 | $ 5,961 | $ 19,249 | $ (1,769) | $ 44,581 | |||||
| Basic earnings per share | $ 0.35 | $ 0.10 | $ 0.32 | $ (0.03) | $ 0.75 | |||||
| Weighted average shares outstanding – basic | 59,730,270 | 59,730,270 | 59,730,270 | 59,730,270 | 59,730,270 | |||||
| Diluted earnings per share | $ 0.35 | $ 0.10 | $ 0.32 | $ (0.03) | $ 0.73 | |||||
| Weighted average shares outstanding – diluted | 61,080,387 | 61,080,387 | 61,080,387 | 61,080,387 | 61,080,387 | |||||
| (1) Represents costs incurred in connection with capacity rationalization, streamlining operations and other cost reduction actions. | ||||||||||
| (2) Represents costs incurred in connection with termination of an inventory supply agreement and related inventory write-down and an impairment of a related equity investment. | ||||||||||
| (3) Represents favorable resolutions of income tax matters. | ||||||||||
| COVANCE INC. | ||||||||
| GAAP to Pro Forma Reconciliation | ||||||||
| Q4 2010 | ||||||||
| (Dollars in thousands, except per share data) | ||||||||
| (UNAUDITED) | ||||||||
| Adjustments | ||||||||
| GAAP | Restructuring Activities (1) | Income Tax Items (2) | Pro Forma | |||||
| Net revenues | $ 491,513 | $ 491,513 | ||||||
| Reimbursable out-of-pocket expenses | 27,942 | 27,942 | ||||||
| Total revenues | 519,455 | - | - | 519,455 | ||||
| Costs and expenses: | ||||||||
| Cost of revenue | 346,924 | 346,924 | ||||||
| Reimbursable out-of-pocket expenses | 27,942 | 27,942 | ||||||
| Selling, general and administrative | 89,810 | (18,092) | 71,718 | |||||
| Depreciation and amortization | 25,919 | (270) | 25,649 | |||||
| Total costs and expenses | 490,595 | (18,362) | - | 472,233 | ||||
| Income from operations | 28,860 | 18,362 | - | 47,222 | ||||
| Other expense (income), net: | ||||||||
| Interest expense (income), net | 430 | 430 | ||||||
| Foreign exchange transaction loss, net | 1,054 | 1,054 | ||||||
| Other expense (income), net | 1,484 | - | - | 1,484 | ||||
| Income before taxes and equity investee earnings | 27,376 | 18,362 | - | 45,738 | ||||
| Tax (benefit) expense | (1,121) | 4,674 | 6,946 | 10,499 | ||||
| Equity investee (loss) earnings | (119) | (119) | ||||||
| Net income | $ 28,378 | $ 13,688 | $ (6,946) | $ 35,120 | ||||
| Basic earnings per share | $ 0.46 | $ 0.22 | $ (0.11) | $ 0.57 | ||||
| Weighted average shares outstanding – basic | 61,390,965 | 61,390,965 | 61,390,965 | 61,390,965 | ||||
| Diluted earnings per share | $ 0.45 | $ 0.22 | $ (0.11) | $ 0.56 | ||||
| Weighted average shares outstanding – diluted | 62,703,690 | 62,703,690 | 62,703,690 | 62,703,690 | ||||
| (1) Represents costs incurred in connection with capacity rationalization, streamlining operations and other cost reduction actions. | ||||||||
| (2) Represents favorable resolutions of income tax matters. | ||||||||
| COVANCE INC. | ||||||||||
| GAAP to Pro Forma Reconciliation | ||||||||||
| For the year ended December 31, 2011 | ||||||||||
| (Dollars in thousands, except per share data) | ||||||||||
| (UNAUDITED) | ||||||||||
| Adjustments | ||||||||||
| GAAP | Restructuring Activities (1) | Other Charges (2) | Income Tax Items (3) | Pro Forma | ||||||
| Net revenues | $ 2,095,938 | $ 2,095,938 | ||||||||
| Reimbursable out-of-pocket expenses | 140,508 | 140,508 | ||||||||
| Total revenues | 2,236,446 | - | - | - | 2,236,446 | |||||
| Costs and expenses: | ||||||||||
| Cost of revenue | 1,467,051 | 1,467,051 | ||||||||
| Reimbursable out-of-pocket expenses | 140,508 | 140,508 | ||||||||
| Selling, general and administrative | 343,044 | (22,592) | (10,287) | 310,165 | ||||||
| Depreciation and amortization | 105,214 | (1,777) | 103,437 | |||||||
| Total costs and expenses | 2,055,817 | (24,369) | (10,287) | - | 2,021,161 | |||||
| Income from operations | 180,629 | 24,369 | 10,287 | - | 215,285 | |||||
| Other expense (income), net: | ||||||||||
| Interest expense (income), net | 1,979 | 1,979 | ||||||||
| Foreign exchange transaction loss, net | 1,248 | 1,248 | ||||||||
| Impairment of equity investment | 12,119 | (12,119) | - | |||||||
| Other expense (income), net | 15,346 | - | (12,119) | - | 3,227 | |||||
| Income before taxes and equity investee earnings | 165,283 | 24,369 | 22,406 | - | 212,058 | |||||
| Tax expense | 33,574 | 8,302 | 3,157 | 2,469 | 47,502 | |||||
| Equity investee earnings | 480 | 480 | ||||||||
| Net income | $ 132,189 | $ 16,067 | $ 19,249 | $ (2,469) | $ 165,036 | |||||
| Basic earnings per share | $ 2.22 | $ 0.27 | $ 0.32 | $ (0.04) | $ 2.77 | |||||
| Weighted average shares outstanding – basic | 59,629,788 | 59,629,788 | 59,629,788 | 59,629,788 | 59,629,788 | |||||
| Diluted earnings per share | $ 2.16 | $ 0.26 | $ 0.32 | $ (0.04) | $ 2.70 | |||||
| Weighted average shares outstanding – diluted | 61,091,354 | 61,091,354 | 61,091,354 | 61,091,354 | 61,091,354 | |||||
| (1) Represents costs incurred in connection with capacity rationalization, streamlining operations and other cost reduction actions. | ||||||||||
| (2) Represents costs incurred in connection with termination of an inventory supply agreement and related inventory write-down and an impairment of a related equity investment. | ||||||||||
| (3) Represents favorable resolutions of income tax matters. | ||||||||||
| COVANCE INC. | ||||||||
| GAAP to Pro Forma Reconciliation | ||||||||
| For the year ended December 31, 2010 | ||||||||
| (Dollars in thousands, except per share data) | ||||||||
| (UNAUDITED) | ||||||||
| Adjustments | ||||||||
| GAAP | Asset Impairment and Restructuring Activities (1) | Income Tax Items (2) | Pro Forma | |||||
| Net revenues | $ 1,925,630 | $ 1,925,630 | ||||||
| Reimbursable out-of-pocket expenses | 112,843 | 112,843 | ||||||
| Total revenues | 2,038,473 | - | - | 2,038,473 | ||||
| Costs and expenses: | ||||||||
| Cost of revenue | 1,348,498 | 1,348,498 | ||||||
| Reimbursable out-of-pocket expenses | 112,843 | 112,843 | ||||||
| Selling, general and administrative | 307,386 | (18,092) | 289,294 | |||||
| Depreciation and amortization | 103,024 | (270) | 102,754 | |||||
| Asset impairment charges | 119,229 | (119,229) | - | |||||
| Total costs and expenses | 1,990,980 | (137,591) | - | 1,853,389 | ||||
| Income from operations | 47,493 | 137,591 | - | 185,084 | ||||
| Other expense (income), net: | ||||||||
| Interest expense (income), net | 52 | 52 | ||||||
| Foreign exchange transaction loss, net | 3,649 | 3,649 | ||||||
| Other expense (income), net | 3,701 | - | - | 3,701 | ||||
| Income before taxes and equity investee earnings | 43,792 | 137,591 | - | 181,383 | ||||
| Tax (benefit) expense | (23,655) | 49,981 | 17,298 | 43,624 | ||||
| Equity investee earnings | 807 | 807 | ||||||
| Net income | $ 68,254 | $ 87,610 | $ (17,298) | $ 138,566 | ||||
| Basic earnings per share | $ 1.08 | $ 1.39 | $ (0.27) | $ 2.20 | ||||
| Weighted average shares outstanding – basic | 63,043,561 | 63,043,561 | 63,043,561 | 63,043,561 | ||||
| Diluted earnings per share | $ 1.06 | $ 1.36 | $ (0.27) | $ 2.15 | ||||
| Weighted average shares outstanding – diluted | 64,472,326 | 64,472,326 | 64,472,326 | 64,472,326 | ||||
| (1) Represents asset impairment charges totaling $119,229 and restructuring costs totaling $18,362 incurred in connection with capacity rationalization, streamlining operations and other cost reduction actions. | ||||||||
| (2) Represents favorable resolutions of income tax matters. | ||||||||
订阅：
博文 (Atom)