FOR IMMEDIATE RELEASE www.quintiles.com
CONTACT: Pat Grebe, Media Relations (media.info@quintiles.com)
Greg Connors, Investor Relations (invest@quintiles.com)
(919) 998 2000
QUINTILES REPORTS 1st QUARTER 2002 EPS OF $0.14,
CASH FLOW FROM OPERATIONS OF $55 MILLION
RESEARCH TRIANGLE PARK, N.C. - April 17, 2002 - Quintiles Transnational Corp.
(Nasdaq: QTRN) today announced financial results for first quarter 2002.
Earnings per share for the quarter ended March 31, 2002, were $0.14 on a diluted
basis, meeting analysts' consensus expectations and a 133% increase from first
quarter 2001 reported earnings per share of $0.06. Total net revenues and net
income for first quarter 2002 were $398.1 million and $17.3 million,
respectively, compared to $403.6 million and $7.8 million for first quarter
2001.
"I'm pleased with the progress we made during the quarter in delivering core
services and executing our business plan, in particular, continued improvements
in efficiency and positioning ourselves to create greater opportunities in
Product Development and Commercialization," said Quintiles Chief Executive
Officer Pam Kirby, Ph.D. "One such example is our strategic agreement with Kos
Pharmaceuticals to commercialize Advicor(TM) and Niaspan(R) in the U.S. to treat
cholesterol disorders. Also, we enhanced our product partnering expertise and
capabilities through the assets we acquired from Bioglan Pharma Inc. Combined
with our PharmaBio Development group's ability to innovate, I believe we offer
customers the industry's widest range of solutions to help develop and
commercialize drugs and manage product portfolios.
"Another event of note during the quarter was our announcement that our
Quintiles Informatics unit would be combined into a joint venture with McKesson.
Through this venture, which we expect to close this quarter, Quintiles will
retain access to the Informatics unit's unique data products, while furthering
our goal of expanding the use of longitudinal patient-level data to improve
healthcare."
Quintiles Transnational Chief Financial Officer Jim Bierman said: "Our efforts
to improve efficiency continue to pay off, as indicated by the strong cash flow
from operations we achieved during the quarter - $55 million - and our record
decrease in net billings outstanding to 37 days in first quarter 2002 from 46
days in first quarter 2001."
In other first quarter developments, Quintiles repurchased 290,000 shares of its
common stock for an aggregate price of approximately $4.8 million as part of its
previously announced stock repurchase program.
As required, Quintiles adopted the guidance of recently issued accounting
pronouncement EITF 01-14, effective Jan. 1, 2002, and, accordingly, has
reclassified reimbursed service costs as part of revenues.
Supplemental financial information is available under "Additional Financials" in
the Investors section of Quintiles' Web site,
http://www.quintiles.com/investors/additional_financials.
Quintiles Transnational's first quarter 2002 financial briefing will be held at
11 a.m. EDT on Thursday, April 18, and will be broadcast live over the Web.
Interested parties can access the Webcast at
http://www.quintiles.com/corporate_info/broadcast_center. Additionally, a replay
of the Webcast will be available via the same link about two hours after
completion of the call, and will be archived for on-demand replay through
5 p.m. EDT, Friday, May 3, 2002.
Quintiles Transnational 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 is a member of the S&P 500 and
Fortune 1000. For more information visit the company's Web site at
www.quintiles.com.
The schedule attached to this release is 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 risk the
market for our products and services will not grow as we expect, the risk that
our PharmaBio transactions will not generate revenues or profit at the rate or
levels we anticipate, our ability to efficiently distribute backlog among
project management groups and match demand to resources, actual operating
performance, the actual savings and operating improvements resulting from the
restructuring, the ability to maintain large customer contracts or to enter into
new contracts, changes in trends in the pharmaceutical industry, 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.
# # #
Condensed Consolidated Statements of Income
(Unaudited)
Three Months Ended March 31
2002 2001
- -----------------------------------------------------------------------------------------------------------
In thousands, except per share data
Revenues:
Service revenues $474,320 $463,265
Commercial rights and royalties 14,194 2,647
Investment 4,782 (902)
- -----------------------------------------------------------------------------------------------------------
Total gross revenues 493,296 465,010
Less: reimbursed service costs 95,153 61,442
- -----------------------------------------------------------------------------------------------------------
Total net revenues 398,143 403,568
Costs of revenues:
Service 211,515 238,905
Commercial rights and royalties 14,279 2,561
Investment 158 30
- -----------------------------------------------------------------------------------------------------------
225,952 241,496
- -----------------------------------------------------------------------------------------------------------
Contribution 172,191 162,072
General, administrative and other:
General and administrative 148,622 156,910
Interest (income) expense, net (3,262) (5,848)
Other (income) expense, net 1,069 (618)
- -----------------------------------------------------------------------------------------------------------
146,429 150,444
- -----------------------------------------------------------------------------------------------------------
Income before income taxes 25,762 11,628
Income taxes expense 8,501 3,837
- -----------------------------------------------------------------------------------------------------------
Net income $ 17,261 $ 7,791
- -----------------------------------------------------------------------------------------------------------
Net income per share:
Basic $ 0.15 $ 0.07
Diluted $ 0.14 $ 0.06
Shares used in computing net income per share:
Basic 118,685 116,338
Diluted 120,227 120,064
</Table>
Consolidated Balance Sheet Data
(Unaudited)
<Table>
<Caption>
March 31, December 31,
2002 2001
- -----------------------------------------------------------------------------------------------------------
In millions
Cash, cash equivalents and debt investments $ 617 $ 602
Investments in marketable equity securities 76 78
Investments in non-marketable equity securities and loans 40 38
Working capital 597 618
Total assets 1,961 1,948
Debt including current portion 39 38
Shareholders' equity 1,460 1,455
- -----------------------------------------------------------------------------------------------------------