| COVANCE ISSUES 3Q EARNINGS ADVISORY |
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Princeton, New Jersey, September 21, 2000 — Covance Inc. (NYSE: CVD) today announced that it expects its earnings for the third quarter ending September 30, 2000 to fall below its second quarter results. Management indicated that losses in the Company's biomanufacturing and clinical development businesses, increased investment spending on internet initiatives, and current softness in central laboratory and select areas of early development services, could result in earnings for the quarter in the range of $0.01 to $0.03 per share.
"While we are disappointed with Covance's current financial performance, there are many opportunities to drive greater shareholder value. Over the past several months, we have been assessing strategic alternatives to unlock the inherent value of each of our businesses," said Chris Kuebler, Covance Chairman and CEO. "Our future will consist of focusing more on areas that can clearly help pharmaceutical companies develop their products more rapidly, with lower cost and increased success rates. To achieve this focus we have engaged investment bankers to explore the possible divestiture of our capital-intensive pharmaceutical packaging and biomanufacturing businesses, which are less critical to our strategy. While these are solid businesses, this move would enable us to reduce our leverage and focus future investments."
Mr. Kuebler added that despite the recent softness in parts of early development and central laboratory services, these industry-leading businesses continue to make solid contributions to the Company's earnings and are integral to our more focused future strategy of optimizing our customer's drug development process.
Covance, with headquarters in Princeton, New Jersey, is one of the world's largest and most comprehensive drug development services companies with 1999 revenues of $829 million, operations currently in 17 countries, and approximately 7,900 employees worldwide. Much more informtaion about Covance can be found throughbout the site, including our products and services, other recent press releases, and SEC filings.
Statements contained in this press release, which are not historical facts, such as statements about prospective earnings, savings, revenue, earnings growth and other financial results are forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All such forward-looking statements including the statements contained herein regarding anticipated trends in the Company's business are based largely on management's expectations and are subject to and qualified by risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. These risks and uncertainties include, without limitation, competitive factors, outsourcing trends in the pharmaceutical industry, the Company's ability to continue to attract and retain qualified personnel, the fixed price nature of contracts or the loss of large contracts, the success of the Company's restructuring, the Company's ability to divest businesses at a satisfactory price, and other factors described in the Company's filings with the Securities and Exchange Commission. |
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