Exhibit 99.1
PDI Reports Third Quarter 2004 Financial Results
Operating Income up 38% over third quarter of 2003
Diluted EPS in third quarter of $0.37 up 28% over third quarter of 2003
Raising 2004 EPS estimates: $1.40 to $1.45 from $1.25 to $1.35
SADDLE RIVER, N.J., Nov. 3 /PRNewswire-FirstCall/ -- PDI, Inc. (Nasdaq: PDII) a healthcare sales and marketing company, today announced its third quarter 2004 financial results.
Third Quarter Results
Revenue for the quarter ended September 30, 2004 was $92.5 million, 2.1% lower than revenue of $94.6 million for the quarter ended September 30, 2003. Operating income was $9.0 million for the quarter ended September 30, 2004, an increase of 38.1% compared to operating income of $6.5 million for the quarter ended September 30, 2003. Net income was $5.5 million for the quarter ended September 30, 2004, compared to net income of $4.2 million in the quarter ended September 30, 2003. Diluted net income per share for the quarter ended September 30, 2004 was $0.37 versus diluted net income per share of $0.29 for the quarter ended September 30, 2003.
Year-to-Date Results
Total revenue for the nine months ended September 30, 2004 was $276.6 million, 12.8% higher than total revenue of $245.3 million for the nine months ended September 30, 2003. Operating income was $27.1 million for the nine months ended September 30, 2004 an increase of 122.9% compared to operating income of $12.1 million for the nine months ended September 30, 2003. Net income was $16.5 million for the nine months ended September 30, 2004 versus net income of $7.8 million for the nine months ended September 30, 2003. Diluted net income per share was $1.11 for the nine months ended September 30, 2004 compared to diluted net income per share of $0.54 for the nine months ended September 30, 2003.
The Company raised its 2004 EPS estimates to $1.40 to $1.45 from $1.25 to $1.35.
Charles T. Saldarini, Vice Chairman and CEO, said, “I am pleased with the way PDI is performing. The steps we have taken to focus on our sales and marketing services and to maintain cost controls have enhanced our performance and brought consistency to our financial results. Our Sales and Marketing Services Group in particular performed well as its revenue in the first nine months of 2004 is up 30.8% versus the first nine months of 2003. We believe that the pharmaceutical industry is looking for ways to be more efficient and flexible. Outsourcing more of their sales and marketing efforts is one way to do that. As an industry leader with a proven track record of results, PDI is structured to provide services to pharmaceutical manufacturers that help them to meet the challenges they face today.”
Regarding the 2005 outlook, Mr. Saldarini continued, “We are finalizing our 2005 forecast and will be providing 2005 EPS estimates early in December.”
Webcast Conference Call
PDI will conduct a live webcast of its Earnings Release Briefing at 9:00 AM EDT on Thursday, November 4, 2004. The live webcast of the event will be accessible through PDI’s website, http://www.pdi-inc.com and will be archived on the website for future on-demand replay. For those without internet access, the call can be accessed by dialing 1-877-423-4030 within the US and 1-706-634-1929 internationally and asking for the PDI Earnings Release Conference Call. The call will be archived for two weeks and can be accessed by calling 1-800-642-1687 or 1-706-645-9291 and entering the conference ID number 1462871.
About PDI
PDI, Inc. (Nasdaq: PDII) is a leading provider of outsourced sales and marketing services to the biopharmaceutical and medical device and diagnostics industries. PDI’s comprehensive set of next-generation solutions is designed to increase its clients’ strategic flexibility and enhance their efficiency and profitability. Headquartered in Saddle River, NJ, PDI also has offices in Pennsylvania and Illinois.
PDI’s sales and marketing services include dedicated, shared, clinical and combination sales teams; marketing research and consulting; medical education and communications; talent recruitment; and integrated commercial solutions from pre-launch through patent-expiration. The company’s experience extends across multiple therapeutic categories and includes office and hospital-based initiatives. PDI’s global presence is maintained through a strategic partnership with In2Focus, a leading U.K. provider of outsourced sales services.
PDI’s commitment is to deliver innovative solutions, excellent execution and superior results to its clients. Through strategic partnership and client-driven innovation, PDI maintains some of the longest sales and marketing relationships in the industry. Recognized as an industry pioneer, PDI continues to innovate today as a thought-starter for the outsourcing of sales and marketing services.
For more information, visit the Company’s website at http://www.pdi-inc.com.
Forward-Looking Statement
This press release contains forward-looking statements regarding future events and financial performance. These statements involve a number of risks and uncertainties and are based on numerous assumptions involving judgments with respect to future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond PDI’s control. Some of the important factors that could cause actual results to differ materially from those indicated by the forward-looking statements are general economic conditions, changes in our operating expenses, adverse patent rulings, FDA, legal or accounting developments, competitive pressures, failure to meet performance benchmarks in significant contracts, changes in customer and market requirements and standards, and the risk factors detailed from time to time in PDI’s periodic filings with the Securities and Exchange Commission, including without limitation, PDI’s Annual Report on Form 10-K/A for the year ended December 31, 2003, and PDI’s periodic reports on Forms 10-Q/A, 10-Q and 8-K filed with the Securities and Exchange Commission since January 1, 2004. The forward looking-statements in this press release are based upon management’s reasonable belief as of the date hereof. PDI undertakes no obligation to revise or update publicly any forward-looking statements for any reason.
PDI, Inc.
Consolidated Balance Sheets
(in thousands, except share data)
(unaudited)
| ASSETS | September 30,
2004 | December 31
2003 |
| Current assets: | | | | | |
| Cash and cash equivalents | | $ 77,284 | | $113,288 | |
| Short-term investments | | 29,032 | | 1,344 | |
| Inventory, net | | — | | 43 | |
| Accounts receivable, net of allowance for | |
| doubtful accounts of $349 and $749 as of | |
| September 30, 2004 and December 31, 2003, | |
| respectively | | 22,932 | | 40,885 | |
| Unbilled costs and accrued profits on | |
| contracts in progress | | 2,442 | | 4,041 | |
| Deferred training and other program costs | | 1,656 | | 1,643 | |
| Other current assets | | 10,836 | | 8,847 | |
| Deferred tax asset | | 3,900 | | 11,053 | |
| Total current assets | | 148,082 | | 181,144 | |
| Net property and equipment | | 18,369 | | 14,494 | |
| Deferred tax asset | | 6,797 | | 7,304 | |
| Goodwill | | 21,759 | | 11,132 | |
| Other intangible assets | | 20,021 | | 1,648 | |
| Other long-term assets | | 3,833 | | 3,901 | |
| Total assets | | $218,861 | | $219,623 | |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | | |
| Current liabilities: | | | | | |
| Accounts payable | | $ 3,394 | | $ 8,689 | |
| Accrued returns | | 4,602 | | 22,811 | |
| Accrued incentives | | 17,149 | | 20,486 | |
| Accrued salaries and wages | | 8,897 | | 9,031 | |
| Unearned contract revenue | | 9,809 | | 3,604 | |
| Restructuring accruals | | 321 | | 744 | |
| Income taxes and other accrued expenses | | 15,422 | | 15,770 | |
| Total current liabilities | | 59,594 | | 81,135 | |
| Total long-term liabilities | | — | | — | |
| Total liabilities | | 59,594 | | 81,135 | |
| Stockholders’ equity: | |
| Preferred stock, $.01 par value, 5,000,000 | |
| shares authorized, no shares issued and | |
| outstanding | | — | | — | |
| Common stock, $.01 par value, 100,000,000 shares | |
| authorized: shares issued and outstanding, September 30, 2004- 14,625,537, | |
| and December 31, 2003 - 14,387,126; 161,115 and 136,178 restricted shares | |
| issued and outstanding at September 30, 2004 and December 31, 2003, | |
| respectively | | 148 | | 145 | |
| Additional paid-in capital | | 115,492 | | 109,531 | |
| Retained earnings | | 45,990 | | 29,505 | |
| Accumulated other comprehensive income | | 47 | | 25 | |
| Unamortized compensation costs | | (2,300 | ) | (608 | ) |
| Treasury stock, at cost: 5,000 shares | | (110 | ) | (110 | ) |
| Total stockholders’ equity | | 159,267 | | 138,488 | |
| Total liabilities & stockholders’ equity | | $ 218,861 | | $ 219,623 | |
PDI, Inc.
Consolidated Statements Of Operations
(in thousands, except per share data)
(unaudited)
| | Three Months Ended
September 30, | Nine Months Ended
September 30, |
| | 2004 | 2003 | 2004 | 2003 |
| | (restated) | (restated) |
| Revenue | | | | | | | | | |
| Service | | $ 92,525 | | $94,470 | | $ 277,666 | | $ 245,111 | |
| Product, net | | (3 | ) | 81 | | (1,034 | ) | 197 | |
| Total revenue | | 92,522 | | 94,551 | | 276,632 | | 245,308 | |
| Cost of goods and | |
| services | |
| Program expenses | |
| (including related | |
| party amounts of | |
| $0 and $653 for | |
| the quarters | |
| ended September 30, | |
| 2004 and 2003, | |
| respectively and | |
| $180 and $1,287 | |
| for the nine | |
| months ended | |
| September 30, | |
| 2004 and 2003, | |
| respectively) | | 68,127 | | 70,085 | | 203,670 | | 182,227 | |
| Cost of goods sold | | 10 | | 952 | | 244 | | 1,097 | |
| Total cost of | |
| goods and | |
| services | | 68,137 | | 71,037 | | 203,914 | | 183,324 | |
| Gross profit | | 24,385 | | 23,514 | | 72,718 | | 61,984 | |
| Compensation | |
| expense | | 8,409 | | 9,297 | | 26,549 | | 27,294 | |
| Other selling, | |
| general and | |
| administrative | |
| expenses | | 6,941 | | 7,676 | | 19,089 | | 20,714 | |
| Restructuring and | |
| other related | |
| expenses | | — | | — | | — | | (270 | ) |
| Litigation settlement | | — | | — | | — | | 2,100 | |
| Total operating | |
| expenses | | 15,350 | | 16,973 | | 45,638 | | 49,838 | |
| Operating income | | 9,035 | | 6,541 | | 27,080 | | 12,146 | |
| Other income, net | | 231 | | 246 | | 860 | | 741 | |
| Income before | |
| provision for | |
| taxes | | 9,266 | | 6,787 | | 27,940 | | 12,887 | |
| Provision for | |
| income taxes | | 3,799 | | 2,605 | | 11,455 | | 5,115 | |
| Net income | | $ 5,467 | | $ 4,182 | | $ 16,485 | | $ 7,772 | |
| Basic net income | |
| per share | | $ 0.37 | | $ 0.29 | | $ 1.13 | | $ 0.55 | |
| Diluted net income | |
| per share | | $ 0.37 | | $ 0.29 | | $ 1.11 | | $ 0.54 | |
| Basic weighted | |
| average number of | |
| shares | |
| outstanding | | 14,621 | | 14,252 | | 14,538 | | 14,202 | |
| Diluted weighted | |
| average number of | |
| shares | |
| outstanding | | 14,933 | | 14,543 | | 14,873 | | 14,349 | |
SOURCE PDI, Inc.
-0- 11/03/2004
/CONTACT: Stephen P. Cotugno, Executive Vice President-Corporate
Development of PDI, Inc., +1-201-574-8617/
/Web site: http://www.pdi-inc.com/ (PDII)
CO: PDI, Inc.
ST: New Jersey
IN: FIN MTC HEA
SU: ERN CCA
