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| Parexel CEO Josef von Rickenbach |
Last year, Parexel ($PRXL) watched its stock price drop after reporting an unexpected decline in net new business, but that was a mere blip and not the beginnings of an alarming trend, the CRO said, boosting its expectations for the next quarter.
In the quarter ended Dec. 31, Parexel expects to post as much as $485 million in revenue--above the $480 million it forecast in October. But most important to investors is the CRO's projected net new business wins, which it figures will come in at a book-to-bill ratio of around 1.3. In the previous quarter, when new contracts slipped about 30%, that ratio was just 0.88.
And the Boston giant expects to sustain that rate through the rest of the fiscal year, slightly raising its annual guidance to as much as $1.9 billion on the year, which would make for roughly 10% annual growth.
The previous quarter's slip-up sent Parexel's shares down as much as 17%, an uncommon event for a CRO that has been growing by leaps and bounds over the last three years. CEO Josef von Rickenbach blamed the sluggishness on "lower new business flow from some strategic partners, delayed client decisions with regard to some of our pending proposals and a win rate that was lower than expected."
Parexel provided the early peek at its financials in tandem with a presentation at the J.P. Morgan Healthcare Conference. The company will release its full quarterly results on Jan. 29.
- read the announcement