WuXi PharmaTech Announces Fourth-Quarter and Full-Year 20...(icetesting. Net revenues from Laborator...)

Date:3/25/2009

ice testing. Net revenues from Laboratory Services increased 99% to $57.4 million in fourth-quarter 2008 and grew 100% to $205.0 million in full-year 2008, including increases of 47% to $42.3 million and 44% to $147.3 million in China-based Laboratory Services for fourth-quarter 2008 and full-year 2008, respectively.

We now define our Manufacturing Services segment as China-based manufacturing of advanced intermediates and active pharmaceutical ingredients (APIs). Net revenues from Manufacturing Services decreased 15% to $7.0 million in fourth-quarter 2008. Manufacturing Services net revenue increased 48% to $48.5 million for full-year 2008, driven by continued expansion of the breadth and depth of our customers and revenue from a single large project in the first half of 2008.

GAAP gross profit grew 27% to $20.3 million in fourth-quarter 2008 and 53% to $96.3 million for full-year 2008, driven by strong net revenue growth, continued healthy gross margins for our China-based Laboratory Services business, and inclusion of ongoing financial results for AppTec. Our GAAP gross margin was 31% and 38% for fourth-quarter and full-year 2008, respectively, versus 43% and 46% for fourth-quarter and full-year 2007, respectively. These declines in GAAP gross margin were mainly due to inclusion in 2008 of the ongoing financial results of AppTec, which has a lower gross margin than our China-based businesses; recording of the amortization of acquired intangible assets in 2008; and lower 2008 gross margins in our China-based Manufacturing Services business due to changes in project mix.

Following a strategic assessment of the ongoing AppTec business, we recorded non-cash charges for goodwill and acquired intangible asset impairment of $60.5 million, pre-tax, in fourth-quarter 2008 operating expenses in accordance with accounting standards SFAS 142 and SFAS 144. As a result, we reported GAAP operating losses
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SOURCE WuXi PharmaTech (Cayman) Inc. Copyright©2009 PR Newswire. All rights reserved

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