SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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):
January 27, 1998
PAREXEL International Corporation
(Exact Name of Registrant as Specified in Charter)
Massachusetts 0-27058 04-2776269
(State or Other (Commission (IRS Employer
Jurisdiction of File Number) Identification No.)
Incorporation)
195 West Street, Waltham, Massachusetts 02154
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code
(781) 487-9900
Not Applicable
(Former Name or Former Address, if Changed Since Last
Report)
Item 5. Other Events.
On January 27, 1998, the Company issued a press
release, a copy of which is attached as Exhibit 99.1 to this
Current Report on Form 8-K.
Item 7. Financial Statements and Exhibits.
Exhibit No. Exhibit
99.1 Press release of the Company dated January 27, 1998.
SIGNATURES
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.
PAREXEL International Corporation
Dated: January 27, 1998 By: /s/William T. Sobo, Jr.
William T. Sobo, Jr., Senior
Vice President, Chief
Financial Officer, Treasurer
and Clerk
EXHIBIT INDEX
Exhibit No. Description
99.1 Press release of the Company dated January 27, 1998
EXHIBIT 99.1
FOR IMMEDIATE RELEASE
CONTACTS: Bill Sobo, Senior Vice President, Chief
Financial Officer
Virginia Lacke, Investor Relations
(617) 487-9904, ext. 4118
PAREXEL REPORTS FINANCIAL RESULTS FOR QUARTER ENDED DECEMBER
31, 1997
Boston, MA, January 27, 1998 -- PAREXEL International
Corporation (Nasdaq: PRXL) today reported the financial
results of its second fiscal quarter ended December 31,
1997. As previously announced, PAREXEL acquired Kemper-
Masterson, Inc. (KMI), a leading regulatory firm
specializing in good manufacturing practice (GMP) consulting
and systems validation testing, during the quarter in a
pooling of interests transaction. The Company's
consolidated financial results include KMI's results of
operations for all periods presented.
PAREXEL's consolidated net revenue was $58.6 million for the
three months ended December 31, 1997, which represents a 47%
increase over net revenue of $39.9 million in the prior-year
period. For the quarter ended December 31, 1997, income
from operations (before a charge related to the KMI
transaction, discussed below) increased 66% to $5.4 million,
or 9.2% of net revenue, compared to $3.2 million, or 8.1% of
net revenue, last year. Net income (before the KMI charge)
was $4.0 million, or $0.19 diluted earnings per share, for
the current quarter versus $2.3 million, or $0.13 per share,
in the prior year. This represents a 72% increase in net
income and a 51% increase in earnings per share between
periods.
For the six months ended December 31, 1997, PAREXEL's net
revenue increased 50% to $112.9 million from $75.2 million
in the prior year. Income from operations (before the KMI
charge) for the first half of the year was $10.3 million, or
9.1% of net revenue, compared to $6.0 million, or 8.0% of
net revenue, in the same period of 1996. Net income (before
the KMI charge) was $7.9 million, or $0.37 diluted earnings
per share, versus $4.3 million, or $0.24 per share, last
year.
"Our financial performance this quarter reinforces PAREXEL's
position as a leading, global CRO, and our commitment to
building the organization through both strategic acquisition
and strong internal growth," offered Josef H. von
Rickenbach, Chairman and Chief Executive Officer of PAREXEL.
"PAREXEL's success and brand identity are, in no small part,
attributed to our long-standing reputation for offering
clients a flexible approach and high-quality services around
the world. The combination of our clinical focus and global
presence has been a differentiating and powerful strategy,
and we will strive to add value for clients by leveraging
our core clinical development expertise throughout the
lifecycle of pharmaceutical products."
As previously disclosed, PAREXEL recorded a pre-tax charge
of $4.1 million in the December 1997 quarter, primarily
related to a non-cash accounting adjustment for stock
options issued by KMI to certain of its key employees.
Including the impact of the KMI charge, PAREXEL's net income
was $1.4 million, or $0.06 diluted earnings per share, for
the three months ended December 31, 1997, and $5.2 million,
or $0.25 diluted earnings per share, for the six months
ended December 31, 1997.
PAREXEL is a leading contract research and medical marketing
organization providing a broad range of knowledge-based
outsourcing services to the worldwide pharmaceutical,
biotechnology and medical device industries. Over the past
fifteen years, PAREXEL has developed significant expertise
in clinical trials management, data management,
biostatistical analysis, medical marketing, clinical
pharmacology, regulatory and medical consulting, industry
training and publishing, and other drug development
consulting services. The Company's integrated services,
therapeutic area depth, and sophisticated information
technology, along with its experience in global drug
development and product launch services, represent key
competitive strengths. Headquartered near Boston, MA,
PAREXEL has 25 offices in 10 countries.
This release may contain statements which may be "forward-
looking" statements under federal law. The Company's actual
results may differ significantly from the results discussed
in the forward-looking statements. Factors that might cause
such a difference include, but are not limited to: risks
associated with the loss or delay of large contracts; the
Company's dependence on certain industries and clients;
management of growth and the ability to attract and retain
employees; acquisitions; government regulation of certain
industries and clients; and competition or consolidation
within the industry. These factors and others are discussed
more fully in the section entitled "Risk Factors" of the
Company's recently filed Registration Statement on Form S-3.
PAREXEL
International
Corporation
Condensed
Consolidated
Statement of
Operations (1)
Excluding KMI
Special Charge
(In thousands,
except per share
data)
(Unaudited) (Unaudited)
Three months ended Six months ended
December 31, December 31,
1997 1996 1997 1996
Net revenue 58,616 39,920 112,886 75,164
Costs and expenses:
Direct costs 38,951 27,198 75,261 51,413
Selling, general 11,781 8,421 22,761 15,722
and administrative
Depreciation and 2,513 1,073 4,540 2,031
amortization
Income from 5,371 3,228 10,324 5,998
operations
Other income, net 824 412 1,781 782
Income before income 6,195 3,640 12,105 6,780
taxes
Net income 4,027 2,341 7,868 4,326
Earnings per common
share:
Basic 0.19 0.13 0.38 0.25
Diluted 0.19 0.13 0.37 0.24
Shares used in
computing earnings
per common share:
Basic 20,704 17,985 20,628 17,623
Diluted 21,188 18,550 21,148 18,169
PAREXEL
International
Corporation
Condensed
Consolidated
Statement of
Operations (1)
Including KMI
Special Charge
(In thousands,
except per share
data)
(Unaudited) (Unaudited)
Three months ended Six months ended
December 31, December 31,
1997 1996 1997 1996
Net revenue 58,616 39,920 112,886 75,164
Costs and expenses:
Direct costs 38,951 27,198 75,261 51,413
Selling, general 11,781 8,421 22,761 15,722
and administrative
Depreciation and 2,513 1,073 4,540 2,031
amortization
Special Charge 4,100 4,100
-- --
Income from 1,271 3,228 6,224 5,998
operations
Other income, net 824 412 1,781 782
Income before income 2,095 3,640 8,005 6,780
taxes
Net income 1,362 2,341 5,203 4,326
Earnings per common
share:
Basic 0.07 0.13 0.25 0.25
Diluted 0.06 0.13 0.25 0.24
Shares used in
computing earnings
per common share:
Basic 20,704 17,985 20,628 17,623
Diluted 21,188 18,550 21,148 18,169
Consolidated Balance ^(Unaudited)
Sheet Information(1)
(In thousands) ^December ^June
31, 30,
^1997 1997
Working capital 111,278 110,876
Total assets 218,658 205,501
Stockholders' equity 149,531 139,164
(1) Prior periods have been restated to combine the accounts
and operations of KMI with those of the Company to reflect
the December 1997 acquisition of KMI, accounted for as a
pooling of interests.
