Encorium Announces Stock Buyback; Provides Business and Financial Update
"Our Board of Directors believes that at current levels, our stock does not reflect the Company's long term value and thus has authorized a stock repurchase program," commented Dr. David Ginsberg, Chief Executive Officer. "We are also pleased that officers and employees will be able to have the opportunity to purchase shares in the open market as well to demonstrate our confidence in the Company's future."
Shares from the buyback are expected to be purchased from time to time on the open market or in privately negotiated transactions, depending on market conditions and the capital requirements of the Company. The Company has approximately 20.6 million shares outstanding as of September 30, 2008.
Business and Financial Update
The Company expects to report total revenue of approximately $7.5 to $7.8 million and a net loss of $ 1.8 to $2.0 million for the quarter ended September 30, 2008. The net loss, includes approximately $850,000 in non-recurring transaction costs relating to the Linkcon and Prologue transactions. In addition, the Company anticipates its net revenue will be approximately $31 to $33 million for the year ended December 31, 2008, as stated previously. At September 30, 2008, Encorium had approximately $5.1 million in cash and expects its business backlog to be approximately $38.0 to $39.6 million.
"We believe Encorium is well positioned for continued growth, as demonstrated by the recent win in the vaccine field," added Dr. Ginsberg. "Our cost-cutting initiatives are moving ahead and we are on plan to reach our initial cost-savings goal of approximately $1.0 million annually. We are continuing to review our operating cost structure and are exploring additional cost savings. The steps we are taking to reposition the business should also enable us to take advantage of the high-growth opportunities in the clinical research industry. We will also continue to review strategic alternatives for the Company as we strive to create value for Encorium shareholders."
Encorium expects to report results for its third quarter ended September 30, 2008 the week of November 10, 2008.
About Encorium Group, Inc.
Encorium Group, Inc. is a global clinical research organization specializing in the design and management of complex clinical trials and Patient Registries for the pharmaceutical, biotechnology and medical device industries. The Company's mission is to provide its clients with high quality, full-service support for their biopharmaceutical and medical device development programs. Encorium offers therapeutic expertise, experienced team management and advanced technologies. The Company has drug and biologics development as well as clinical trial experience across a wide variety of therapeutic areas such as infectious diseases, cardiovascular, vaccines, oncology, diabetes endocrinology/metabolism, gene therapy, immunology, neurology, gastroenterology, dermatology, hepatology, women's health and respiratory medicine. Encorium believes that its expertise in the design of complex clinical trials, its therapeutic experience and commitment to excellence, and its application of innovative technologies, offer its clients a means to more quickly and cost effectively move products through the clinical development process. Encorium is headquartered in Wayne, Pennsylvania with its European base of operations in Espoo, Finland. The Company has a geographic footprint that includes over one billion people in North America, Western/Central/Eastern Europe, Scandinavia, and the Baltics.
This press release contains forward-looking statements identified by words such as "estimate," "project," "expect," "intend," "believe," "anticipate" and similar expressions regarding future expectations. Those statements involve risks and uncertainties, and actual results could differ materially from those discussed. Risks and uncertainties that could affect the Company's future operating results and financial condition generally include, without limitation: (i) our success in attracting new business and retaining existing clients and projects; (ii) the size, duration, and timing of clinical trials we are currently managing may change unexpectedly; (iii) the termination, delay or cancellation of clinical trials we are currently managing could cause revenues and cash-on-hand to decline unexpectedly; (iv) the timing difference between our receipt of contract milestone or scheduled payments and our incurring costs to manage these trials; (v) outsourcing trends in the pharmaceutical, biotechnology and medical device industries; (vi) the ability to maintain profit margins in a competitive marketplace; (vii) our ability to attract and retain qualified personnel; (viii) the sensitivity of our business to general economic conditions; (ix) other economic, competitive, governmental and technological factors affecting our operations, markets, products, services and prices; (x) announced awards received from existing and potential customers are not definitive until fully negotiated contracts are executed by the parties; (xi) our backlog may not be indicative of future revenues and may not generate the revenues expected; (xii) our ability to successfully integrate the businesses of Encorium and Remedium Oy which we acquired on November 1, 2006; and (xiii) the performance of the combined business to operate successfully and generate growth. You should not place any undue reliance on these forward-looking statements which speak only as of the date of this press release. Additional information concerning factors that might affect our business or stock price which could cause actual results to materially differ from those in forward-looking statements is contained in Encorium Group's SEC filings, including its Annual Report on Form 10-K for the year ended December 31, 2007 and other periodic reports under the Securities Exchange Act of 1934, as amended, copies of which are available upon request from Encorium Group's investor relations department.
SOURCE Encorium Group, Inc.
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