Research and development outsourcing company, WuXi PharmaTech -Cayman- Inc. (WX), Tuesday reported a 72% rise in net income for the second quarter, reflecting a 37% increase in net income from continuing operations and the absence of losses from discontinued operations recorded last year, even as revenues declined from last year. The company reiterated its revenue forecast for the full year, citing better-than-expected results for the quarter. WuXi PharmaTech shares surged more than 11% in the after-hours trading, following the announcement of results.
The Shanghai, China-based company's net income for the second quarter increased to $15.00 million or $0.22 per ADS from $8.52 million or $0.14 per ADS in the same quarter last year.
Excluding items, net income for the quarter rose 7% to $18.00 million or $0.24 per ADS from $17.00 million or $0.23 per ADS last year.
Six analysts polled by Thomson Reuters expected the company to earn $0.12 per share for the second quarter. Analysts' estimates typically exclude special items.
Quarterly revenues decreased 3% to $67.00 million from $69.10 million in the prior year quarter.
Segment wise, laboratory services revenues for the quarter increased 19% year-over-year, while manufacturing revenues plunged 69% from last year.
Total cost of revenues for the quarter dropped 9% to $40.00 million from $44.00 million in the year-ago quarter.
Income from continuing operations for the quarter rose 37% to $15.00 million from $11.00 million last year. The company did not report any loss from discontinued operations for the quarter, while in the year-ago quarter incurred a loss of $2.20 million.
Gross margin for the quarter grew to 40% from 37% from the prior-year period, mainly due to lower amortization expenses for acquired intangible assets. Operating expenses decreased 5% to $13.44 million from $14.20 million in the prior-year period.
For the six-month period, net income increased to $26.42 million or $0.39 per ADS from $22.40 million or $0.36 per ADS in the same period last year. Income from continuing operations edged up 2% to $26.42 million from $26.00 million in the year-ago period. Revenues for the six months rose modestly to $126.10 million from $125.30 million in the corresponding period last year.
For the fiscal year 2009, WuXi PharmaTech still expects revenues to be in the range of $265 million - $275 million. Analysts currently expect the company to report revenues of $267.84 million for the full year.
WX closed Tuesday's trading at $10.50, up $0.01 or 0.10%, on a volume of 0.37 million shares on the NYSE. In after hours, the stock further gained $1.20 or 11.43%, trading at $11.70.
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