Covance 3Q profit remains flat

PRINCETON, N.J. (AP) — Drug development services company Covance Inc. said Wednesday its third-quarter profit remained flat as higher expenses offset a boost in revenue from late-stage development contracts.

The company provides services to companies and laboratories in various stages of the drug development process. The economic slump has taken its toll on some early-stage programs, as drug companies refine their focus in an effort to cut costs.

During the quarter Covance earned just under $51.1 million, or 79 cents per share, down from profit of just over $51.1 million, or 80 cents per share, during the year-ago period. Excluding a one-time gain on the sale of its IVRS business and a tax benefit, Covance earned 67 cents per share in the latest period.

Revenue rose 6 percent to $493.7 million from $467.4 million.

Analysts polled by Thomson Reuters expected profit of 67 cents per share on revenue of $468.8 billion, on average.

Covance said early-stage development services revenue fell nearly 9 percent to $196.5 million, while late-stage development services revenue rose 24 percent to $278.9 million. Meanwhile, costs and expenses jumped 10 percent to $435.9 million.

Shares fell $1.15, or 2.1 percent, to $53.50 in after-hours trading, after losing $1.15 to close the regular trading session at $54.65.