PPD 3Q Earnings Up, Cuts 2008 Guidance
PPD, a contract research organization (CRO), reported third quarter revenue increased 11.6% to $398.5 compared with $357.2 million for the third quarter of 2007. Diluted earnings per share jumped 34% to $0.43 per share.
The company lowered its full-year revenue projection to between $1.47 billion and $1.49 billion from $1.54 billion to $1.59 billion as a result of a FDA delay in approving diabetes drug alogliptin.
Income from operations for the third quarter rose 35% to $71.3 million.
New business authorizations for the third quarter amounted to $705 million, a 23.6 percent year-over-year increase. Contract cancellations for the quarter were $207.7 million, for a book-to-bill ratio of 1.36. The company's cancellation rate was 24%. Backlog at Sept. 30 was $3 billion, a year-over-year increase of 20%.
"We were very pleased with the level of new business wins and the rebound from the second quarter," said Fred Eshelman, CEO of PPD. "While third quarter revenue growth was moderately slower than expected, demand for drug development services remains strong, and we believe our new authorizations and existing backlog should help drive future top line sustained growth."