Monday, Pharmaceutical Product Development, Inc. (PPDI) reported a steep decline in profit for the fourth quarter from a year ago on lower revenue and higher expenses, including R&D costs.
PPD sold its subsidiaries - Piedmont Research Center, LLC and PPD Biomarker Discovery Sciences, LLC, this fiscal.
Excluding income from discontinued operations, PPD's profit from continuing operations decreased to $17.63 million or $0.16 per share from $47.12 million or $0.40 per share in the year-ago period. On an average, 11 analysts polled by Thomson Reuters expected earnings of $0.23 per share. Analysts' estimates typically exclude one-time items.
This year's results include impairments of an intangible asset and equity investments totaling $10.0 million, net of tax, related to the company's dermatology program within the compound partnering business and the company's investment portfolio, respectively.
Fourth-quarter net revenue decreased to $357.4 million from $363.1 million. However, the quarter's revenue was above analysts expectations of $314.33 million. Income from operations fell to $23.9 million from $71.7 million
PPD's development segment net revenue decreased to $328.1 million from $338.7 million, while discovery sciences segment net revenue increased to $0.5 million from $0.1 million.
The company's total direct costs increased to $185.95 million from $179.51 million, R&D costs rose to $13.34 million from $1.04 million and S,G&A expenses shot up to $107.03 million from $95.95 million in the year-ago period.
New business authorizations for the fourth quarter totaled $465.6 million with backlog at December 31, 2009, standing at $3.0 billion. Contract cancellations and adjustments for the quarter were $284.9 million, including three large project cancellations that together represented approximately four percent of year-end backlog.
For the full-year, PPD's profit declined to $140.13 million or $1.34 per share from $187.94 million or $1.56 per share last year. Revenue decreased to $1.42 billion from $1.55 billion. Analysts expected full-year EPS of $1.26 on revenue of $1.30 billion.
PPDI closed Monday's regular trading session at $22.13, down $0.37 or 1.64%, on the Nasdaq.
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