Parexel returns to growth after a shaky quarter

Parexel CEO Josef von Rickenbach

Parexel International ($PRXL), slashing jobs after a rough run, posted some modest revenue gains in its fiscal fourth quarter, and now the CRO is looking to build some momentum with a jump in new business.

The Boston company pulled in $523 million in service revenue, a 2.4% increase over the same period last year due to growth in its clinical research segment that offset flat sales in informatics and a decline in consulting revenue. The CRO's net income dipped nearly 15% to $34.2 million due in part to a $20 million restructuring charged tied to Parexel's ongoing job cuts and corporate reshuffling.

The CRO giant disclosed plans last month to lay off about 850 workers over the next year to save between $20 million and $30 million in annual costs. The move followed a flat revenue quarter that led Parexel to dim its fiscal year revenue guidance by about 2%. The company's fiscal 2015 revenue came in at roughly $2 billion, a 4% increase over 2014.

But Parexel is expecting a quick return the double-digit growth it once consistently enjoyed, forecasting fiscal 2016 revenue of up to $2.2 billion, a 14% increase. To get there, the CRO will have to execute on its $5.3 billion backlog and work to replicate the $818 million in new business it inked in the fourth quarter.

"On the back of solid momentum in biopharmaceutical R&D, we finished the fourth quarter with a strong backlog and business development pipeline," CEO Josef von Rickenbach said in a statement. "We are committed to building on this positive momentum in the industry in fiscal year 2016, and we believe we have laid the foundation for strong performance."

- read the results