PDI Reports 2013 First Quarter Financial Results

               PDI Reports 2013 First Quarter Financial Results

Management to Host Conference Call Tomorrow, May 14, 2013 at 8:30AM ET

PR Newswire

PARSIPPANY, N.J., May 13, 2013

PARSIPPANY, N.J., May 13, 2013 /PRNewswire/ -- PDI, Inc. (Nasdaq: PDII), today
reported financial and operational results for the first quarter ended March
31, 2013. Summary financial and operating highlights include:

  oFirst quarter 2013 revenue increase of 36% to $42.9 million compared to
    the same period last year.
  oOperating income of $2.3 million for the first quarter of 2013, a $2.5
    million improvement compared to a loss of $0.2 million in the first
    quarter of 2012.
  oEarnings per share of $0.14 for the first quarter of 2013 compared to a
    loss of $0.02 per share for the same period in 2012.
  oAdjusted EBITDA (a non-GAAP financial measure) increase of over 300%, to
    $2.9 million compared to $0.7 million in the same period of 2012.
  oSigning of $17 million multi-year sales contract for which PDI will
    provide a dedicated team to promote a CNS therapeutic product to
    neurologists and pain specialists.



Condensed Summary Statements of Continuing Operations

($'s in millions, expect per share data)
                                              1st Quarter Ended
                                              March 31,*
                                              2013           2012
Revenue, net                                  $         $      31.7
                                              42.9
Gross profit                                  8.5            7.4
Operating expenses:
 Compensation expense                       4.2            4.6
 Other SG&A                                 2.1            3.0
 Total operating expenses             6.2            7.6
Operating income (loss)                       $        $     
                                              2.3            (0.2)
Provision for income tax                      0.1            0.1
Income (loss) from continuing operations      $        $     
                                              2.2            (0.3)
Diluted income (loss) per share from          $         $     (0.02)
continuing operations                         0.14
 *Unaudited

CEO Comments

Commenting on the results, Nancy Lurker, chief executive officer of PDI, Inc.,
noted, "Revenues from contracts signed in 2012 have begun to positively impact
our top line, resulting in revenue for the first quarter of 2013 increasing
36% to $42.9 million compared to the same period last year. Gross profit
increased $1.1 million to $8.5 million even though, as anticipated, our gross
profit percentages began to trend lower due to increasing competitive
pressures. As a result of our ongoing focus on lower costs, operating expenses
declined $1.4 million and we are pleased to note that for the first quarter of
2013 we achieved operating income of $2.3 million compared to a loss of $0.2
million for the first quarter last year."

Ms. Lurker continued, "As we have previously discussed, we entered 2013 with a
strong backlog of business under contract. Given the strong first quarter 2013
results and assuming a reasonable level of new business wins and no early
termination of existing contracts, we still anticipate revenue for the full
year to be approximately 25% higher than 2012. We also still expect gross
profit percentages to continue to decline over the course of 2013, resulting
in gross profit for the full year to be at or below the level achieved in
2012.

"We previously announced that 2013 would be a year of investment and expansion
of our strategic focus. Given the dynamics of our current core businesses, we
are committed to continuing to grow our top line, streamline costs and to
develop more predictable, higher growth and higher margin businesses. While we
will continue to aggressively pursue ongoing cost improvements, we do expect
our expenses to increase slightly to support investment in areas aimed at
differentiating and further strengthening our core offerings. Strategically,
we also will continue to pursue full product commercialization partnering
opportunities that leverage our current PDI infrastructure and capabilities
through Interpace BioPharma, our specialty biopharmaceutical division. In
addition, we plan to launch a new Group DCA product that will connect health
care providers, sales representatives and other promotional channels in a new
and unique way. We expect to see tangible results in each of these initiatives
by the end of 2013."

First Quarter Business Review

Revenue- For the first quarter of 2013, revenue of $42.9 million was $11.2
million or 36% higher than the first quarter of 2012 driven by increases in
the company's Sales Services segment.

  oSales Services segment revenue for the first quarter of 2013 of $38.2
    million was $14.9 million higher than the first quarter of 2012 driven by
    2012 multi-year new contract wins being executed in 2013.
  oMarketing Services segment revenue for the first quarter of 2013 of $1.5
    million was $1.5 million lower than the first quarter of 2012 due
    primarily to fewer contract signings by Group DCA.
  oProduct Commercialization Services segment revenue for the first quarter
    of 2013 of $3.2 million was $2.1 million lower than the first quarter of
    2012 due to the internalization of selected commercialization activities
    by our customer as of October 1, 2012.

Gross Profit- For the first quarter of 2013, gross profit of $8.5 million was
$1.1 million higher than the first quarter of 2012. The overall gross profit
percentage decreased to 20% in 2013 from 23% in 2012.

  oSales Services segment gross profit for the first quarter of 2013 of $7.3
    million was $2.4 million higher than the first quarter of 2012 primarily
    due to higher revenue. As previously disclosed, the company realized lower
    margins on new business.
  oMarketing Services segment gross profit for the first quarter of 2013 of
    $0.4 million was $0.9 million lower than 2012 as certain fixed costs could
    not be reduced in line with lower revenue.
  oProduct Commercialization Services segment gross profit for the first
    quarter of 2013 of $0.8 million was $0.4 million lower compared to 2012 as
    a result of lower revenue due to the internalization of commercialization
    activities by the company's customer.

Total Operating Expenses- Total operating expenses for the first quarter of
2013 of $6.2 million were $1.4 million lower than 2012. The decrease is
primarily a result of the company's continuing focus on cost reduction,
right-sizing of the businesses and absence of amortization of acquired
intangible assets beginning in the first quarter of 2013.

Operating Income- For the first quarter of 2013 operating income was $2.3
million, compared to an operating loss of $0.2 million in the first quarter of
2012. The $2.5 million improvement in 2013 operating income was the result of
higher revenue and lower expenses.

Liquidity and Cash Flow- Adjusted EBITDA (a non-GAAP measure defined in the
release) for the first quarter of 2013 was $2.9 million compared to $0.7
million in the first quarter of 2012. Cash and cash equivalents at the end of
the first quarter were $53.3 million, up $0.6 million from December 31, 2012.
Cash and equivalents did not increase in line with Adjusted EBITDA primarily
due to a net increase in working capital requirements.

As of March 31, 2013, the company's cash equivalents were predominantly
invested in U.S. Treasury money market funds and the company had no commercial
debt.

Non-GAAP Financial Measures

In addition to the United States generally accepted accounting principles, or
GAAP, results provided throughout this document, PDI has provided certain
non-GAAP financial measures to help evaluate the results of its performance.
The company believes that these non-GAAP financial measures, when presented in
conjunction with comparable GAAP financial measures, are useful to both
management and investors in analyzing the company's ongoing business and
operating performance. The company believes that providing the non-GAAP
information to investors, in addition to the GAAP presentation, allows
investors to view the company's financial results in the way that management
views financial results.

In this document, the company discusses Adjusted EBITDA, a non-GAAP financial
measure. Adjusted EBITDA is a metric used by management to measure cash flow
of the ongoing business. Adjusted EBITDA is defined as operating income or
loss, plus depreciation and amortization, non-cash stock-based compensation,
and other non-cash expenses. The table below includes a reconciliation of this
non-GAAP financial measure to the most directly comparable GAAP financial
measure.

Adjusted EBITDA (Unaudited)
($ in thousands)
                              1st Quarter Ended
                              March 31,
                              2013            2012
Operating income (loss)      $    2,253  $      (221)
Depreciation and amortization 288             501
Stock compensation            351             429
Adjusted EBITDA               $    2,892  $      709

Conference Call

As previously announced, PDI will hold a conference call tomorrow, Tuesday,
May 14, 2013 to discuss financial and operational results of the first quarter
ended March 31, 2013 as follows:

Time: 8:30 AM (ET)
Dial-in numbers: (866) 644-4654 (U.S. and Canada) or (706) 643-1203
Conference ID#: 33293275

Live webcast: www.pdi-inc.com, under "Investor Relations"

The teleconference replay will be available three hours after completion
through May 18, 2013 at (800) 585-8367 (U.S. and Canada) or (404) 537-3406.
The replay pass code is 33293275. The archived web cast will be available for
one year.

About PDI, Inc.

PDI is a leading health care commercialization company providing superior
insight-driven, integrated multi-channel message delivery to established and
emerging health care companies. The company is dedicated to enhancing
engagement with health care practitioners and optimizing commercial
investments for its clients by providing strategic flexibility, full product
commercialization services, innovative multi-channel promotional solutions,
and sales and marketing expertise. For more information, please visit the
company's website at http://www.pdi-inc.com.

Forward-Looking Statements

This press release contains forward-looking statements regarding future events
and financial performance. These statements are based on current expectations
and assumptions involving judgments about, among other things, future
economic, competitive and market conditions and future business decisions, all
of which are difficult or impossible to predict accurately and many of which
are beyond PDI's control. These statements also involve known and unknown
risks, uncertainties and other factors that may cause PDI's actual results to
be materially different from those expressed or implied by any forward-looking
statement. For example, with respect to statements regarding projections of
future revenues, growth and profitability, actual results may differ
materially from those set forth in this release based on the loss, early
termination or significant reduction of any of our existing service contracts,
the failure to meet performance goals in PDI's incentive-based arrangements
with customers or the inability to secure additional business. Additionally,
all forward-looking statements are subject to the risk factors detailed from
time to time in PDI's periodic filings with the Securities and Exchange
Commission, including without limitation, PDI's Annual Report on Form 10-K for
the year ended December 31, 2012, and PDI's subsequently filed quarterly
reports on Form 10-Q and current reports on Form 8-K. Because of these and
other risks, uncertainties and assumptions, undue reliance should not be
placed on these forward-looking statements. In addition, these statements
speak only as of the date of this press release and, except as may be required
by law, PDI undertakes no obligation to revise or update publicly any
forward-looking statements for any reason.

(Tables to Follow)

 PDI, INC.
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (UNAUDITED)
 (in thousands, except per share data)
                           Three Months Ended
                           March 31,
                           2013       2012
 Revenue, net              $      $    
                           42,923     31,677
 Cost of services          34,450     24,311
 Gross profit              8,473      7,366
 Compensation expense      4,155      4,582
 Other selling, general
 and administrative        2,065      3,005
 expenses
 Total operating expenses  6,220      7,587
 Operating income (loss)   2,253      (221)
 Other expense, net        (9)        (1)
 Income (loss) from
 continuing operations
 before
 income tax                2,244      (222)
 Provision for income tax  64         81
 Income (loss) from        2,180      (303)
 continuing operations
 (Loss) income from
 discontinued operations,  (54)       31
 net of tax
 Net income (loss)        $      $     
                            2,126     (272)
 Basic income (loss) per
 share of common stock:
 From continuing           $      $     
 operations                  0.15  (0.02)
 From discontinued         (0.01)     -
 operations
 Net income (loss) per     $      $     
 basic share of common       0.14  (0.02)
 stock
 Diluted income (loss) per
 share of common stock:
 From continuing           $      $     
 operations                  0.14  (0.02)
 From discontinued         -          -
 operations
 Net income (loss) per     $      $     
 diluted share of common     0.14  (0.02)
 stock
 Weighted average number
 of common shares and
 common share equivalents
 outstanding:
 Basic                     14,983     14,536
 Diluted                   15,074     14,536
 Segment Data (Unaudited)
 ($ in thousands)
                           Sales      Marketing    PC
                           Services   Services     Services*    Consolidated
 Three months ended March
 31, 2013:
 Revenue, net              $      $       $        $   
                           38,225     1,541       3,157        42,923
 Gross profit              $      $       $       $    
                            7,319      384      770         8,473
 Gross profit %            19.1%      24.9%        24.4%        19.7%
 Three months ended March
 31, 2012:
 Revenue, net              $      $       $         $   
                           23,369     3,063        5,245       31,677
 Gross profit              $      $       $         $    
                            4,953    1,235        1,178       7,366
 Gross profit %            21.2%      40.3%        22.5%        23.3%
 * Product
 Commercialization (PC)
 Services
 Selected Balance Sheet Data (Unaudited)
 ($ in thousands)
                           March     December
                           31,       31,
                           2013       2012
 Cash and cash equivalents $      $    
                           53,333     52,783
 Total current assets      $      $    
                           76,657     71,583
 Total current liabilities 38,725     36,390
 Working capital           $      $    
                           37,932     35,193
 Total assets              $      $    
                           82,797     78,447
 Total liabilities         $      $    
                           44,917     42,817
 Total stockholders'       $      $    
 equity                    37,880     35,630
 Selected Cash Flow Data (Unaudited)
 ($ in thousands)
                           March 31,
                           2013       2012
 Net income (loss)         $       $    
                           2,126     (272)
 Non-cash items:
  Depreciation and     288        501
 amortization
  Stock-based          351        429
 compensation
  Other                35         35
 Net change in assets and  (1,578)    (3,043)
 liabilities
 Net cash provided by      $       $   
 (used in) operations      1,222     (2,350)
 Change in cash and cash   $      $   
 equivalents               550       (2,465)

SOURCE PDI, Inc.

Website: http://www.pdi-inc.com
Contact: INVESTOR AND MEDIA CONTACT: Melody Carey, Rx Communications Group,
LLC, (917) 322-2571, Mcarey@RxIR.com
 
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