Wuxi Pharmatech (cayman) (NYSE:WX)

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Friday, November 11, 2011

Comments & Business Outlook

Third quarter of 2011 Highlights

Third-Quarter 2011 Net Revenues Increased 24.0% Year Over Year to $104.0 Million
Manufacturing Services Net Revenues Grew 183.8% Year Over Year to $20.1 Million
Laboratory Services Net Revenues Grew 9.2% Year Over Year to $83.9 Million
China-Based Laboratory Services Net Revenues Increased 10.7% Year Over Year to $63.2 Million
GAAP Operating Income Increased 15.8% Year Over Year to $22.2 Million
Non-GAAP Operating Income Increased 10.1% Year Over Year to $24.9 Million
GAAP Diluted Earnings Per ADS Declined 53.8% Year Over Year to 27 Cents Due to Inclusion in the Prior-Year Results of a Termination Fee Relating to the Proposed Transaction with Charles River Laboratories and an Increase in the Effective Tax Rate
Non-GAAP Diluted Earnings Per ADS Increased 2.6% Year Over Year to 31 Cents Due to an Increase in the Effective Tax Rate
WuXi Refines Its Full-Year 2011 Guidance
Board Member Jeff Leng Elected to Audit Committee

2011 Financial Guidance

The company updates its full-year 2011 financial guidance:

Total net revenues of $402-406 million, including about $1.5 million from two months of combined revenue from the newly acquired Abgent and MedKey businesses
Growth in net revenues of China-based Laboratory Services of 14-15%
Growth in net revenues of U.S.-based Laboratory Services of about 6%
Growth in net revenues of Manufacturing Services of at least 84%
GAAP gross margin approximately equal to that in full-year 2010, and a year-over-year decline in non-GAAP gross margin of about 1.5 percentage points
GAAP operating margin of about 21% and non-GAAP operating margin of about 24%
Capital expenditures of $60-65 million
GAAP effective tax rate of about 18%

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Friday, October 14, 2011

Acquisition Activity

SHANGHAI, October 14, 2011 /PRNewswire-Asia/ -- WuXi PharmaTech (Cayman) Inc. (NYSE: WX), a leading pharmaceutical, biotechnology and medical device research and development services company with operations in China and the United States, today announced the acquisition of Abgent, Inc., a provider of biological research reagent products and services based in Suzhou, China, and San Diego, California.

Founded in 2001, Abgent is already one of the world's largest manufacturers of antibody reagents for research use. The company maintains a comprehensive catalog of about 20,000 antibody products. Abgent also serves as the original manufacturer of antibodies distributed by large reagent suppliers. The company distributes its antibody reagent products by direct sales through its web portal and small sales force and through a network of distributors around the world. In addition to manufacturing antibodies, Abgent also develops and produces peptides and proteins for research and diagnostic applications. See More

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Thursday, August 11, 2011

Comments & Business Outlook

Second Quarter 2011 Results

Highlights

WuXi PharmaTech Quarterly Net Revenues Exceeded $100 Million for the First Time
Second-Quarter 2011 Net Revenues Increased 24.8% Year Over Year to $101.1 Million
Laboratory Services Net Revenues Grew 10.3% Year Over Year to $80.1 Million
China-Based Laboratory Services Net Revenues Increased 14.5% Year Over Year to $60.3 Million
Manufacturing Services Net Revenues Grew 148.7% Year Over Year to $21.0 Million
GAAP Diluted Earnings Per ADS Grew 34.2% Year Over Year to 25 Cents
Non-GAAP Diluted Earnings Per ADS Increased 9.3% Year Over Year to 29 Cents

Management Comment

"WuXi delivered strong revenue and income growth in the second quarter," said Dr. Ge Li, Chairman and Chief Executive Officer. "For the first time in our company's history we topped $100 million in quarterly net revenues. Total net revenues and GAAP diluted EPS grew 24.8% and 34.2%, respectively. At the same time, we continued to invest in new capabilities and capacity to better serve our customers and to sustain future growth.

"WuXi met or exceeded its financial guidance for the quarter. Revenues grew to $101.1 million, versus our guidance of $97-99 million. Net revenues in both Laboratory Services and Manufacturing Services exceeded our guidance. GAAP and non-GAAP operating margins were comparable to those in the first quarter, as we expected.

"We are particularly pleased with the strong performance of our Manufacturing Services business this year. A few years ago we chose to diversify, investing in building and equipping a new facility for large-scale commercial manufacturing as a natural extension of our capabilities in small-scale manufacturing of drugs for preclinical and clinical trials. We are now seeing a very strong return on this investment.

"We continue to expect 2011 to be a strong year for WuXi, with annual revenue growth of 20-22% in a highly competitive environment. We expect to achieve mid-teens annual revenue growth in the China-based Laboratory Services business. Manufacturing Services annual revenue is expected to grow 80-90% to approximately $70-74 million in 2011, versus $39 million in 2010 and $20 million in 2009.

"In 2011, we will continue to invest and build a strong integrated drug R&D service platform to be the industry's alternative R&D engine to discover and develop new drugs. Among our major investment projects in 2011 are a new site in Wuhan for our chemistry business, a new GMP biologics manufacturing facility in the city of Wuxi, expansion of our new research manufacturing capacity in our Jinshan facility, and continuing build-up of pharmacology models and biology capabilities. In the second quarter, we opened our new API/drug product stability testing facility dedicated to Bristol-Myers Squibb. To help manage this uniquely broad R&D services platform, we have recently hired several executives with significant expertise and extensive industry experience across the drug discovery and development value chain.

"WuXi has a business model that is working," Dr. Li concluded. "Offshore outsourcing of R&D offers pharmaceutical and biotech companies greater operational flexibility and access to high-quality scientific expertise at reasonable prices. Moreover, we are beginning to see increasing interest from our customers to develop drugs for the rapidly growing Chinese pharmaceutical market. As the leading R&D outsourcing service company in China, WuXi is in a unique position to help our customers to discover and develop drugs for both global markets and the Chinese market."

2011 Financial Guidance

The company announces the following update of its full-year 2011 financial guidance:

Total net revenues of $400-407 million, which represents 20-22% growth
Growth in net revenues of China-based Laboratory Services of 14-15%
Growth in net revenues of U.S.-based Laboratory Services of 5-7%
Growth in net revenues of Manufacturing Services of 80-90%
Decrease in gross margin of about 1 percentage point
GAAP operating margin of about 21% and non-GAAP operating margin of about 24%
Capital expenditures of about $60 million
GAAP effective tax rate of about 18%

The Company provides the following guidance for third-quarter 2011 performance:

Total net revenues of $100-103 million, or 19-23% year-over-year growth
Laboratory Services revenues of $82-84 million, Manufacturing Services net revenues of $18-19 million
GAAP and non-GAAP operating margins of about 21% and 24%, respectively

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Wednesday, May 11, 2011

Comments & Business Outlook

First Quarter Results:

First-Quarter 2011 Net Revenues Increased 16% Year Over Year to $93.6 Million
Laboratory Services Net Revenues Grew 12% Year Over Year to $75.2 Million
China-Based Laboratory Services Net Revenues Increased 12% Year Over Year to $56.1 Million
U.S.-Based Laboratory Services Net Revenues Increased 12% Year Over Year to $19.1 Million
Manufacturing Services Net Revenues Grew 35% Year Over Year to $18.3 Million, Driven by Commercial Manufacturing
GAAP Diluted Earnings Per ADS Grew 16% Year Over Year to 24 Cents
Non-GAAP Diluted Earnings Per ADS Increased 16% Year Over Year to 29 Cents
Company Reconfirms 2011 Financial Guidance

GeoTeam® Note: 2011 First quarter analyst EPS estimates were $0.24.

"WuXi began 2011 with a strong performance," said Dr. Ge Li, Chairman and Chief Executive Officer. "We achieved double-digit revenue and EPS growth, while we continued to invest in new capabilities and capacity to better serve our customers.

Diluted non-GAAP earnings per ADS grew 16% year over year to 29 cents compared to 25 cents in first-quarter 2010, mainly due to the 17% increase in non-GAAP net income, offset by slightly higher share count due to exercise of stock options.

The company reconfirms all of its full-year 2011 financial guidance:

Total net revenues of $390-405 million, which represents 17-21% growth
Growth in net revenues of China-based Laboratory Services of 14-18%
Growth in net revenues of U.S.-based Laboratory Services of 8-10%
Growth in net revenues of Manufacturing Services of 50-60%
Decrease in gross margin of about 1 percentage point due to appreciation of the Chinese RMB relative to the U.S. dollar and labor cost inflation, partially offset by a gross margin increase in our manufacturing business

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Wednesday, April 27, 2011

Liquidity Requirements

We believe that our cash and cash equivalents and anticipated cash flows from operations will be sufficient to meet our anticipated cash needs for the foreseeable future, including purchases of equipment and the remaining capital expenditures needed for capacity expansion.

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Wednesday, March 9, 2011

Research

Reported 2010 fourth quarter EPS of $0.28 vs. $0.21 estimate. 2011 revenue guidance is in line with analyst estimates of $400 million. Even though 2011 EPS is expected to be flat at $1.09, seven out of the next eight quarters are forecast to grow nicely. We will track this stock closely. We need to inquire about the other income line, which contributed EPS of $0.39 to 2010 results. WX is an ex- GeoBargain. We will pull SAIC filings.

See outlook

See earnings review of all ChinaHybrids on our Blog.

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Comments & Business Outlook

Net revenues grew 20% year over year to $88.6 million
Laboratory Services net revenues increased 16% year over year to $78.5 million
China-based Laboratory Services net revenues grew 16% year over year to $59.6 million
Non-GAAP diluted earnings per ADS grew 29% year over year to $0.28

"WuXi concluded a strong 2010 with a solid fourth quarter," said Dr. Ge Li, Chairman and Chief Executive Officer. "Revenue grew 20% in the quarter, with strong performances in all of our businesses. We further expanded our capabilities and capacity to better serve our customers, and they responded by expanding their collaborations with WuXi."

"We expect 2011 to be another strong year for WuXi, with revenue growth of 17-21% and stable margins despite an environment of RMB appreciation and labor cost inflation in China. WuXi is rapidly expanding its new Laboratory Services businesses and will reap the benefits of years of hard work in research manufacturing with revenue growth in our new commercial manufacturing business."

Total net revenues of $390-405 million, which represents 17-21% growth

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Monday, January 10, 2011

Comments & Business Outlook

SHANGHAI, Jan. 10, 2011 /PRNewswire-Asia/ -- WuXi PharmaTech today announced that it will present at the 29th Annual J.P. Morgan Healthcare Conference on Tuesday, January 11, 2011 at 3:30 p.m. Pacific Standard Time and updated its 2010 financial guidance. Based on preliminary, unaudited results, WuXi expects to slightly exceed the top end of its previous guidance for 2010 total net revenues of $330-333 million and to exceed year-over-year growth in 2010 non-GAAP operating income of 28-32%. The company also expects to achieve the remainder of the 2010 financial guidance found in its third-quarter 2010 earnings release

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Tuesday, November 9, 2010

Comments & Business Outlook

Third-Quarter 2010 Highlights

Net revenues grew 20% year over year to $83.8 million.

GAAP operating income grew 31% and non-GAAP operating income grew 26% year over year.

GAAP diluted earnings per ADS grew 205% year over year to 59 cents, driven by a strong operating performance and a termination fee relating to the proposed transaction with Charles River Laboratories.

Non-GAAP diluted earnings per ADS grew 26% year over year to30 cents.

"WuXi continued a strong 2010 with an excellent third quarter," said Dr. Ge Li, Chairman and Chief Executive Officer. "Total company revenues grew 20% year over year, and each of our businesses delivered strong revenue growth in the quarter. GAAP net income grew by 209% year over year, driven by this strong revenue growth and receipt of a $30 million termination fee relating to the proposed merger transaction with Charles River. Non-GAAP net income grew year over year by 27%. This strong performance leads us once again to increase our net revenue and operating income guidance for 2010.

2010 Financial Guidance Update

We update our full-year 2010 financial guidance as follows:

Total net revenues of $330-$333 million, or year-over-year growth of 22-23%, compared to previous guidance of $320-$325 million, or 19-20% growth.

Growth in non-GAAP operating income of 28-32%, compared to previous guidance of 15-20%.

Decline in GAAP gross margin of approximately two percentage points, compared to previous guidance of two to three percentage points.

decline in non-GAAP gross margin of less than two percentage points, compared to previous guidance of two to three percentage points.

Capital expenditures$48-$50 million, compared to previous guidance of $50 million.

Effective tax rate of 13-15%, excluding merger-related costs and the termination fee related to the proposed Charles River transaction, as indicated in previous guidance.

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Thursday, April 22, 2010

Research

Wuxi Pharmatech removed from the GeoBargain on the Radar List. PEG ratio is near 1 .

Added to the GeoBargain List on May 15, 2009 @ $6.35

Current Price: $16.15

Reached a high of $18.00 on November 30, 2009

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Comments & Business Outlook

Commenting on 2010 guidance, Edward Hu, chief operating officer and acting chief financial officer, said, "In 2010, we expect continued solid financial performance while we invest for the future. We expect that growth in total net revenues will significantly accelerate from 7% in 2009 to 15-19% in 2010, driven by broad-based demand for our integrated services platform. China Laboratory Services is expected to achieve revenue growth of 13-16%. Manufacturing Services revenues are expected to grow more than 70% year over year in 2010, benefiting from a large delivery in the first quarter and from generally improving demand. Revenues in U.S.-based Laboratory Services are expected to grow at a mid-single-digit rate. These projections assume very small revenue contributions from the large-scale manufacturing and toxicology businesses in 2010.

"Operating income in 2010 is expected to achieve growth of up to 10 percent compared to 2009, driven by strong revenue growth and increased leverage of SG&A. An expected 2-5 percentage point gross margin decrease, primarily in the second half of 2010, is due to several factors, including an increase in labor and depreciation expenses, expenses from the ramp-up of the toxicology and large-scale GMP manufacturing operations, and pricing pressure. We are working to improve our projected 2010 gross margins. We expect the growth rate in operating income to accelerate in 2011, driven by continued strong revenue growth from China-based laboratory services, meaningful revenues from toxicology and large-scale manufacturing, and improving margins."

Source: PR Newswire (March 8, 2010)

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