SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): May 13, 2002
PDI, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 0-24249 22-2919486
(State or other jurisdiction of (Commission File (IRS Employer
incorporation) Number) Identification No.)
10 Mountainview Road,
Upper Saddle River, NJ 07458
(Address of principal executive office) (Zip Code)
(201) 258-8450
Registrant's telephone number, including area code:
Professional Detailing, Inc.
(Former name or former address, if changed since last report)
Item 5. Other Events
On May 13, 2002 the Registrant issued the following press release:
"PDI REPORTS FIRST QUARTER 2002 FINANCIAL RESULTS
Revenue of $73.9 million; Operating Loss of $4.5 million; and Net Loss per share
of $0.16
Upper Saddle River, New Jersey (Monday, May 13, 2002). PDI, Inc. (Nasdaq: PDII)
today announced revenue, an operating loss, a net loss and a net loss per share
for the quarter ended March 31, 2002.
Quarterly Results
Net total revenue for the quarter ended March 31, 2002 was $73.9 million, 57.3%
lower than net total revenue of $173.1 million for the quarter ended March 31,
2001. Net product revenue for the quarter ended March 31, 2002 was $5.7 million
compared to $95.0 million for the quarter ended March 31, 2001. Net service
revenue for the quarter ended March 31, 2002 was $68.2 million, 12.7% lower than
net service revenue of $78.1 million for the quarter ended March 31, 2001. There
was an operating loss for the quarter ended March 31, 2002 of $4.5 million,
compared to operating income of $16.7 million for the quarter ended March 31,
2001. There was a net loss for the quarter ended March 31, 2002 of $2.3 million
compared to net income of $10.9 million for the quarter ended March 31, 2001.
The net loss per share was $0.16 for the quarter ended March 31, 2002 compared
to diluted net income per share of $0.77 for the quarter ended March 31, 2001.
Charles T. Saldarini, Chief Executive Officer of PDI, Inc. commented, "During
the first quarter we continued to focus our efforts on transitioning PDI from a
service based to a product driven company by concentrating on leveraging our
sales and marketing capabilities, our financial assets and our reputation for
high quality work. We believe we are making progress in this transition, which
should positively impact future period results."
Mr. Saldarini added, "The financial results from our first quarter reflect
weakness in our performance based contracts segment. In addition, the net
product revenue decline reflects the termination of our sales, marketing and
distribution agreement for Ceftin(R). We are continuing to work actively with
our partners to monitor our programs' progress and to leverage the sales assets
we have deployed to the mutual benefit of both PDI and its pharmaceutical
company partners."
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Webcast and Conference Call
PDI will conduct a live webcast of its Earnings Release Briefing at 9:00 AM EDT
on Tuesday, May 14, 2002. The live webcast of the event will be accessible
through PDI's website, 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 1-800-233-2795 and asking for conference ID# - PDI.
About PDI
PDI is a commercial partner providing sales and marketing solutions to the
pharmaceutical, biotech, and medical devices & diagnostics industries. PDI
provides customized plans designed to create win-win situations with our partner
companies. With an infrastructure of over 4,000 sales and marketing
professionals, PDI has demonstrated the ability to deliver return on investment
for products at any stage of their lifecycles, from pre-launch through maturity.
Depending on the needs of a product, PDI can provide services, such as contract
sales, both dedicated teams and shared teams, marketing research, medical
education and communications, managed markets and trade relations, and prelaunch
and after sales support. In addition, PDI can enter into strategic relationships
such as Product Commercialization, copromotion, LifeCycle Extension or product
acquisition.
For more information, visit the Company's website at www.pdi-inc.com.
This press release contains forward-looking statements regarding the timing and
financial impact of the Company's ability to implement its business plan,
expected revenues, earnings per share and success during the year 2002. These
statements involve a number of risks and uncertainties and are based on
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
developments, competitive pressures, changes in customer and market requirements
and standards, and the risk factors detailed from time to time in PDI's periodic
reports and registration statements filed with the Securities and Exchange
Commission, including without limitation PDI's Annual Report on Form 10-K filed
for the year ended December 31, 2001. The forward looking-statements in this
press release are based upon management's reasonable belief as of the date
hereof. PDI disclaims any obligation to update these statements.
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PDI, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
March 31, December 31,
2002 2001
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(unaudited)
ASSETS
Current assets:
Cash and cash equivalents ................................................ $ 147,524 $ 160,043
Short-term investments ................................................... 3,397 7,387
Inventory, net ........................................................... -- 442
Accounts receivable, net of allowance for doubtful accounts of
$1,560 and $3,692 as of March 31, 2002 and December 31, 2001,
respectively ......................................................... 33,020 52,640
Unbilled costs and accrued profits on contracts in progress .............. 9,357 6,898
Deferred training ........................................................ 4,465 5,569
Other current assets ..................................................... 6,336 8,101
Deferred tax asset ....................................................... 24,041 24,041
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Total current assets ........................................................ 228,140 265,121
Net property, plant & equipment ............................................. 22,132 21,044
Other long-term assets ...................................................... 15,796 16,506
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Total assets ................................................................ $ 266,068 $ 302,671
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable ......................................................... $ 5,862 $ 9,493
Accrued rebates and sales discounts ...................................... 59,381 68,403
Accrued contract losses .................................................. 600 12,256
Accrued incentives ....................................................... 16,960 22,213
Accrued salaries and wages ............................................... 10,648 7,167
Unearned contract revenue ................................................ 10,338 10,878
Other accrued expenses ................................................... 13,151 21,026
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Total current liabilities ................................................... 116,940 151,436
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Long-term liabilities:
Deferred tax liability ................................................. 300 300
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Total long-term liabilities ................................................. 300 300
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Total liabilities ........................................................... $ 117,240 $ 151,736
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Stockholders' equity:
Common stock, $.01 par value; 100,000,000 shares authorized;
shares issued and outstanding March 31, 2002 - 13,969,389;
December 31, 2001 - 13,968,097; restricted $.01 par value;
shares issued and outstanding, March 31, 2002 - 15,388;
December 31, 2001 - 15,388 ............................................. $ 140 $ 140
Preferred stock, $.01 par value, 5,000,000 shares authorized, no
shares issued and outstanding .......................................... -- --
Additional paid-in capital .................................................. 102,777 102,757
Additional paid-in capital, restricted ...................................... 954 954
Retained earnings ........................................................... 45,741 48,008
Accumulated other comprehensive loss ........................................ (48) (79)
Unamortized compensation costs .............................................. (626) (735)
Treasury stock, at cost: 2001 - 5,000 shares ................................ (110) (110)
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Total stockholders' equity .................................................. $ 148,828 $ 150,935
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Total liabilities & stockholders' equity .................................... $ 266,068 $ 302,671
========= =========
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PDI, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
Three Months Ended March 31,
----------------------------
2002 2001
-------- --------
(unaudited)
Revenue
Service, net .............................................. $ 68,160 $ 78,087
Product, net .............................................. 5,723 94,978
-------- --------
Total revenue, net ...................................... 73,883 173,065
-------- --------
Cost of goods and services
Program expenses (including related party amounts of
$97 and $414 for the periods ended
March 31, 2002 and 2001, respectively) ................... 67,277 55,395
Cost of goods sold ........................................ -- 64,215
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Total cost of goods and services ...................... 67,277 119,610
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Gross profit ................................................. 6,606 53,455
Compensation expense ......................................... 7,759 11,015
Other selling, general & administrative expenses ............. 3,325 25,728
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Total selling, general & administrative expenses .......... 11,084 36,743
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Operating (loss) income ...................................... (4,478) 16,712
Other income, net ............................................ 889 1,870
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(Loss) income before provision for taxes ..................... (3,589) 18,582
(Benefit) provision for income taxes ......................... (1,322) 7,653
-------- --------
Net (loss) income ............................................ $ (2,267) $ 10,929
======== ========
Basic net (loss) income per share ............................ $ (0.16) $ 0.79
======== ========
Diluted net (loss) income per share .......................... $ (0.16) $ 0.77
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Basic weighted average number of shares outstanding .......... 13,969 13,843
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Diluted weighted average number of shares outstanding ........ 13,969 14,133
======== ========
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
PDI, INC.
By: /s/ Charles T. Saldarini
------------------------------------
Charles T. Saldarini, Vice Chairman
and Chief Executive Officer
Date: May 14, 2002
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