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PPD Issues 2009 Financial Guidance

^{Published on 2009-01-14 13:28:33, Last Modified on 2009-01-14 13:30:13 - Market Wire}
 

WILMINGTON, N.C.--([ BUSINESS WIRE ])--PPD, Inc. (Nasdaq: PPDI) today reported its projected 2009 financial guidance.

PPD anticipates that net revenue for the full year 2009 will be in the range of $1.595 to $1.670 billion, a projected increase of approximately 12 percent over the company's full year 2008 net revenue forecast. The company expects diluted earnings per share for the full year 2009 to be in the range of $1.97 to $2.05, a projected increase of approximately 18 percent over its full year 2008 earnings forecast. The quarterly 2009 diluted earnings per share should be in the following ranges: Q1 - $0.38 to $0.40; Q2 - $0.54 to $0.56; Q3 - $0.51 to $0.53; and Q4 - $0.54 to $0.56.

The following table shows the full year 2009 net revenue and diluted earnings per share guidance and full year 2009 target growth rates by segment and total company:

The 2009 guidance for the discovery sciences segment includes three anticipated milestone payments from the company's compound partnering programs. First, PPD anticipates the approval of the marketing authorization application, or MAA, for dapoxetine in Europe in the first quarter of 2009. If this occurs, the first two national approvals will each trigger a $2.5 million milestone payment to PPD. Second, PPD is forecasting the approval of Takeda Pharmaceutical Company Limited's new drug application, or NDA, for alogliptin in the United States in the second quarter of 2009. If that event occurs, PPD will earn a $25.0 million milestone payment from Takeda. Third, the company anticipates that Takeda will submit an MAA for alogliptin to the European Medicines Agency, or EMEA, in the third quarter of 2009. PPD will earn a $10.0 million milestone payment from Takeda upon acceptance of the MAA by the EMEA. The 2009 guidance for the discovery sciences segment does not include any royalties from the company's compound partnering programs.

PPD anticipates that cash flow from operations for the full year 2009 will exceed $250 million. Projected capital expenditures for the full year 2009 should be in the range of $80 to $90 million. These expenditures will be primarily for facility expansions and improvements, as well as investments in information technology and new laboratory equipment.

"We believe PPD is well-positioned to deliver solid financial results in 2009," said Fred Eshelman, chief executive officer of PPD. "Our 2009 financial guidance demonstrates our confidence in the core development business, and we plan to continue to focus our efforts on sales execution and operational excellence throughout the year."

Commenting on compound partnering, Eshelman said, "We look forward to the continued advancement of our compound partnering portfolio, and are optimistic about our efforts generating significant value for our partners and shareholders in 2009. We remain committed to evaluating new opportunities in this area to further leverage our clinical development expertise and drive long-term, sustainable growth."

Net revenue is the most directly comparable GAAP financial measure to net revenue excluding reimbursed out-of-pocket expenses. Although net revenue excluding reimbursed out-of-pocket expenses is not superior to or a substitute for GAAP net revenue, PPD excludes reimbursed out-of-pocket expenses from its forecasted net revenue because they are difficult to accurately predict and are immaterial in that they do not affect operating income, net income or earnings per share. PPD further believes this non-GAAP financial information is useful to investors because it more accurately reflects the net revenue that will be generated by PPD's services, and because it provides information for period-to-period comparisons.

PPD will conduct a live conference call and audio webcast tomorrow, January 15, 2009, at 9 a.m. EST to discuss its 2009 financial guidance. A Q&A session will follow. All interested parties can access the webcast through the Presentations & Events link in the Investors section of the PPD Web site at [ http://www.ppdi.com ]. The webcast will be archived shortly after the call for on-demand replay. The conference call will be broadcast live over the Internet, and the live call may be accessed via the following direct dial numbers:

PPD is a leading global contract research organization providing discovery, development and post-approval services as well as compound partnering programs. Our clients and partners include pharmaceutical, biotechnology, medical device, academic and government organizations. With offices in 33 countries and more than 10,500 professionals worldwide, PPD applies innovative technologies, therapeutic expertise and a commitment to quality to help its clients and partners maximize returns on their R&D investments and accelerate the delivery of safe and effective therapeutics to patients. For more information, visit our Web site at [ http://www.ppdi.com ].

Except for historical information, all of the statements, expectations and assumptions contained in this news release, including the projections of net revenue, earnings, milestone payments, cash flow, and capital spending for 2009, are forward-looking statements that involve a number of risks and uncertainties. Although PPD attempts to be accurate in making these forward-looking statements, it is possible that future circumstances might differ from the assumptions on which such statements are based. In addition, other important factors which could cause actual results to differ materially include the following: economic conditions and outsourcing trends in the pharmaceutical, biotechnology and medical device industries and academic and government-sponsored research sectors; success in sales growth; loss of large contracts; increased cancellation rates; competition within the outsourcing industry; costs and risks associated with the development and commercialization of drugs, including uncertainties regarding regulatory submissions and approvals for dapoxetine and alogliptin; risks associated with and dependence on collaborative relationships; the ability to attract and retain key personnel; rapid technological advances that make our products and services less competitive; risks associated with acquisitions and investments, such as impairments; and the other risk factors set forth from time to time in the SEC filings for PPD, copies of which are available free of charge upon request from the PPD investor relations department.