Parexel has reported positive financial results for the second quarter of 2008.
During the period the contract research organisation (CRO) saw its revenue grow 32.0 per cent year-over-year to $238.7m and its operating income increase 47.7 per cent to $20.5m. Pre-tax profit rose to $20.2m, up from the $14.7m generated in the comparable quarter of the prior year. The gains were on par with those in the first quarter. On another positive not for the company, Parexel said its backlog increased approximately 41 per cent year-over-year to total $1.8bn during Q2, which ended on 31 December. On a segment basis, the firm's Clinical Research Services (CRS) business, which represents the biggest chunk of the company's services operations, generated sales for the second quarter of $182.7m, up from $132.5m in the year-ago quarter, although profit margins eroded by 0.4 percentage points to 32.9 per cent. Revenues in the company's consulting and medical communications (PCMS) segment saw revenue gains from $28.3m in Q2 of 2006, to $32.5m, and an improvement also on the first quarter where sales remained flat. Moreover, profit margin climbed 7.5 percentage points to 34.2 per cent.
The PCMS unit has been the poor performer of Parexel in the past few quarters and the company has been taking steps to turn things around, including redundancies in order to cut costs. It appears to be paying off. Its third segment, Perceptive Informatics also displayed a revenue increase to $23.4m up from $19.7m although this unit also saw its profit margin drop 1.7 percentage points to 44.7 per cent. Meanwhile, Parexel's revenues reflecting the continued globalisation of the CRO industry, with the firm reporting gains across all regions. Of particular note is a more than doubling of its Asia-Pacific revenues, which reached $17.7m, from $8.8m in the comparable 2006 period.
In October the company purchased a CRO in Taiwan as a means to further exert its presence in this industry's budding Asia-Pacific region.