EX-99 2 ex99-1.txt EX99-1.TXT EXHIBIT 99.1 FOR IMMEDIATE RELEASE Contact: Bruce Johnson Matt Hayden eResearchTechnology, Inc. Hayden Communications 215-282-5580 858-704-5065 eResearchTechnology Reports First Quarter Results Reports Revenue of $22.9 Million and Earnings per Share of $0.08 PHILADELPHIA, PA April 27, 2005/PRNewswire-FirstCall/ -- eResearchTechnology, Inc. (Nasdaq: ERES) ("eRT" or "the company"), a leading provider of technology and services to the pharmaceutical, biotechnology and medical device industries, announced today results for the quarter ended March 31, 2005. The company reported revenues of $22.9 million for the first quarter, compared to $26.1 million in revenue reported for the first quarter of 2004. eRT reported net income for the first quarter of 2005 of $4.1 million, or $0.08 per diluted share, versus net income of $7.3 million, or $0.13 per diluted share, for the first quarter of 2004. The company's tax rate for the first quarter of 2005 was 40.8% compared to 40.2% in the first quarter of 2004. The company signed $24.5 million in new contracts and work orders in the first quarter of 2005, including $9.1 million for new Thorough Phase I definitive ECG study agreements. eRT ended the quarter with $70.8 million in cash and short-term investments, an increase from $68.7 million at the end of 2004. "Recent industry communications serve to reinforce that there is considerable debate over the current regulatory guidance for cardiac safety evaluation in clinical trials, and such uncertainty continues to impact our ability to accelerate new contract signings including Thorough QTc studies," commented Joseph Esposito, President and CEO of eRT. "We will continue to maintain our infrastructure to ensure that we deliver the highest quality services to our clients and remain prepared for accelerated growth prospects that could result from regulatory guidance expected from the next step of the ICH process," Mr. Esposito added. 2005 Guidance The company issued the following guidance for 2005: For the second quarter of 2005, the company expects to report revenues of between $20 and $23 million and net income of $0.06 to $0.09 per diluted share. For the full year 2005, the company expects to report revenue of between $96 and $104 million and diluted earnings per share of $0.36 to $0.44. Mr. Esposito and Bruce Johnson, the company's Chief Financial Officer, will hold a conference call to discuss these results. The conference call will take place at 4:45 p.m. EDT on April 27, 2005. Interested participants should call 888-874-9713 when calling within the United States or 973-935-8506 when calling internationally. There will be a playback available until May 27, 2005. To listen to the playback, please call 877-519-4471 when calling within the United States or 973-341-3080 when calling internationally. Please use pass code 5952291 for the replay. This call is being webcast by ViaVid Broadcasting and can be accessed at eRT's web site at www.eRT.com. The webcast may also be accessed at ViaVid's website at www.viavid.net/detailpage.aspx?sid=000024A0. The webcast can be accessed until May 27, 2005 on either site. Based in Philadelphia, PA, eResearchTechnology, Inc. (www.eRT.com) is a provider of technology and services to the pharmaceutical, biotechnology and medical device industries on a global basis. The company is a market leader in providing centralized core-diagnostic electrocardiographic (ECG) technology and services to evaluate cardiac safety in clinical development. The company is also a leader in providing technology and services to streamline the clinical trials process by enabling its customers to automate the collection, analysis, and distribution of clinical data in all phases of clinical development. Statements included in this release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements, including, but not limited to, 2005 financial guidance, and the timing of regulatory guidance, involve a number of risks and uncertainties such as the company's ability to obtain new contracts and accurately estimate net revenues due to uncertain regulatory guidance, variability in size, scope and duration of projects, and internal issues at the sponsoring client, competitive factors, technological development, and market demand. As a result, actual results may differ materially from any financial outlooks stated herein. Further information on potential factors that could affect the company's financial results can be found in the company's Report on Form 10-K filed with the Securities and Exchange Commission. The company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise. eResearchTechnology, Inc. and Subsidiaries Consolidated Statements of Operations (in thousands, except per share amounts) (unaudited) Three Months Ended March 31, 2004 2005 -------------- -------------- Net revenues: Licenses $ 2,453 $ 1,663 Services 18,010 15,902 Site support 5,629 5,349 -------------- -------------- Total net revenues 26,092 22,914 -------------- -------------- Costs of revenues: Cost of licenses 122 133 Cost of services 5,985 6,490 Cost of site support 2,363 3,183 -------------- -------------- Total costs of revenues 8,470 9,806 -------------- -------------- Gross margin 17,622 13,108 -------------- -------------- Operating expenses: Selling and marketing 2,453 2,338 General and administrative 2,150 2,896 Research and development 973 991 -------------- -------------- Total operating expenses 5,576 6,225 -------------- -------------- Operating income 12,046 6,883 Other income (expense), net 108 (5) -------------- -------------- Income before income taxes 12,154 6,878 Income tax provision 4,886 2,806 -------------- -------------- Net income $ 7,268 $ 4,072 ============== ============== Basic net income per share $ 0.14 $ 0.08 ============== ============== Diluted net income per share $ 0.13 $ 0.08 ============== ============== Shares used to calculate basic net income per share 50,933 50,370 ============== ============== Shares used to calculate diluted net income per share 55,405 53,324 ============== ============== eResearchTechnology, Inc. and Subsidiaries Consolidated Balance Sheets (in thousands, except share and per share amounts)

December 31, March 2004 31, 2005 --------- --------- ASSETS (unaudited) Current assets: Cash and cash equivalents $ 45,806 $ 38,877 Short-term investments 22,942 31,942 Accounts receivable, net 14,798 14,814 Prepaid expenses and other 3,522 3,831 Deferred income taxes 323 323 --------- --------- Total current assets 87,391 89,787 Property and equipment, net 25,204 25,310 Goodwill 1,212 1,212 Other assets 782 498 Deferred income taxes 1,936 1,332 --------- --------- $ 116,525 $ 118,139 ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 2,455 $ 2,169 Accrued expenses 4,318 4,269 Income taxes payable 2,147 176 Current portion of capital lease obligations 233 167 Deferred revenues 20,325 19,614 --------- --------- Total current liabilities 29,478 26,395 --------- --------- Capital lease obligations, excluding current portion 193 159 --------- --------- Stockholders' equity: Preferred stock-$10.00 par value, 500,000 shares authorized, none issued and outstanding -- -- Common stock-$.01 par value, 175,000,000 shares authorized, 56,396,696 and 56,506,808 shares issued, respectively 564 565 Additional paid-in capital 69,694 70,558 Accumulated other comprehensive income 1,601 1,395 Retained earnings 46,550 50,622 Treasury stock, 6,067,519 shares at cost (31,555) (31,555) --------- --------- Total stockholders' equity 86,854 91,585 --------- --------- $ 116,525 $ 118,139 ========= =========

eResearchTechnology, Inc. and Subsidiaries Consolidated Statements of Cash Flows (in thousands) (unaudited)

Three Months Ended March 31, 2004 2005 -------- -------- Operating activities: Net income $ 7,268 $ 4,072 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 2,006 2,630 Cost of sale of equipment -- 269 Provision for uncollectable accounts 39 45 Stock option income tax benefits 3,647 540 Investment impairment charge -- 284 Changes in operating assets and liabilities: Accounts receivable (4,188) (120) Prepaid expenses and other (995) (238) Accounts payable (14) (275) Accrued expenses (669) (119) Income taxes 960 (1,370) Deferred revenues 5,349 (672) -------- -------- Net cash provided by operating activities 13,403 5,046 -------- -------- Investing activities: Purchases of property and equipment (4,035) (3,148) Purchases of short-term investments (10,900) (15,175) Proceeds from sales of short-term investments 3,596 6,175 -------- -------- Net cash used in investing activities (11,339) (12,148) -------- -------- Financing activities: Repayment of capital lease obligations (161) (100) Proceeds from exercise of stock options 867 326 -------- -------- Net cash provided by financing activities 706 226 -------- -------- Effect of exchange rate changes on cash 58 (53) -------- -------- Net increase (decrease) in cash and cash equivalents 2,828 (6,929) Cash and cash equivalents, beginning of period 38,364 45,806 -------- -------- Cash and cash equivalents, end of period $ 41,192 $ 38,877 ======== ========