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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)
March 1, 2000
PAREXEL INTERNATIONAL CORPORATION
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(Exact Name of Registrant as Specified in Charter)
MASSACHUSETTS 0-27058 04-2776269
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(State or Other (Commission File Number) (IRS Employer
Jurisdiction of Identification No.)
Incorporation)
195 WEST STREET, WALTHAM, MASSACHUSETTS 02451
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(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)
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ITEM 5. OTHER EVENTS.
On March 1, 2000, 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 March 1, 2000.
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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: March 9, 2000 by: /s/William T. Sobo, Jr.
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William T. Sobo, Jr.
Senior Vice President, Chief
Financial Officer, Treasurer and
Clerk
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EXHIBIT INDEX
Exhibit No. Description
99.1 Press release of the Company dated March 1, 2000.
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EXHIBIT 99.1
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FOR IMMEDIATE RELEASE
WWW.PAREXEL.COM
CONTACTS: Investors: Bill Sobo, Senior Vice President, Chief Financial
Officer
Jill Baker, Director of Investor Relations
(781) 434-4118
Media: Kate Morgans, Vice President Worldwide Marketing
(781) 434-4705
PAREXEL ANNOUNCES CANCELLATION OF SERVICE CONTRACTS
BOSTON, MA, MARCH 1, 2000 - PAREXEL International Corporation (Nasdaq: PRXL)
announced today that Novartis, a key client, has reduced the amount of work
currently outsourced to the PAREXEL Clinical Research Services (CRS) business
unit, due to Novartis' reprioritization of its research pipeline. As a result,
PAREXEL reported that CRS revenues would fall materially short of expectations
commencing in the third quarter ending March 31, 2000. The Company estimates
that total revenues for the third quarter will be reduced by approximately $1 to
$2 million, for the quarter ending June 30, 2000 by up to approximately $9
million, and for fiscal 2001 by up to approximately $40 to $45 million. Earnings
per share will be reduced by approximately $0.04 in the quarter ending March 31,
2000, approximately $0.09 in the quarter ending June 30, 2000, and approximately
$0.20 in fiscal 2001. A restructuring charge, which is currently being
quantified, will be taken in the quarter ending March 31, 2000 and will involve
a reduction of up to 400 - 500 positions. Additional details concerning the
restructuring will be made available at a later date.
Joerg Reinhardt, Ph.D., Global Head of Pharma Development for Novartis
commented, "PAREXEL is a key strategic outsourcing partner, with whom we have a
long-standing relationship. We are pleased with the quality of work that PAREXEL
has delivered on these projects to date, and are continuing to partner with the
Company on other projects now. We look forward to our ongoing relationship with
PAREXEL."
"Although we are disappointed by these cancellations, they do not affect the
nature of our long-standing and productive working relationship with Novartis,"
stated Josef von Rickenbach, Chairman and Chief Executive Officer of PAREXEL.
"While such cancellations have recently affected the entire Contract Research
industry, there remains a significant demand for clinical development services
and the expertise that PAREXEL offers. This demand is evident in the strong new
business activity and proposal volume we are seeing. I would like to assure you
that we will be working even more aggressively to generate new business to
mitigate the impact of these cancellations."
Mr. von Rickenbach added, "Among the benefits of our recently established Client
Research Unit (CRU) structure is our ability to respond rapidly and rationally
to change, and we will therefore act quickly to match operational capacity with
demand and make any necessary infrastructure adjustments. Moving forward, we
will continue to analyze the impact of this cancellation on our business, and
will take steps to maintain high service levels and improve the profitability
and efficiency of our operations."
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This release contains "forward-looking" statements regarding future results and
events, including statements regarding expected future growth, financial
performance, operations, client relationships, and customer demand. The
Company's actual future results may differ materially from the results discussed
in the forward-looking statements contained in this release. 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 and its ability to retain and expand its client
relationships; the Company's ability to manage growth and its ability to attract
and retain employees; the Company's ability to complete additional acquisitions
and to integrate newly acquired businesses; government regulation of certain
industries and clients; competition and consolidation within the industry; the
potential for significant liability to clients and third parties; the potential
adverse impact of health care reform; and the effects of exchange rate
fluctuations. These factors and others are discussed more fully in the section
entitled "Risk Factors" of the Company's Quarterly Report on Form 10-Q for the
quarter ended December 31, 1999.
PAREXEL is one of the largest contract pharmaceutical outsourcing organizations
in the world, providing a broad range of knowledge-based contract research,
medical marketing and consulting services to the worldwide pharmaceutical,
biotechnology and medical device industries. With a commitment to providing
solutions that accelerate time-to-market and peak market penetration, 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 operates in 44
locations throughout 29 countries around the world, and has approximately 4,600
employees.
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