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Covance Management Discusses Q2 2012 Results - Earnings Call Transcript

Before we begin the discussion, I would like to remind you that statements made during today's conference call and webcast, which are not historical facts, might be considered forward-looking statements. Such statements may include comments regarding future financial results and are subject to a number of risks and uncertainties, certain of which are beyond Covance's control. Actual results could differ materially from such statements due to a variety of facts, including the ones outlined in our SEC filings.

Certain of the financial measures we will discuss on this call are non-GAAP measures, which exclude the effects of events we consider to be outside of our normal operations. We believe that providing these measures helps investors gain a more complete understanding of our results and is consistent with how management views our financial results. For a reconciliation of GAAP to pro forma results, please refer to the supplemental schedules included in our press release issued last night.

Now, I will turn it over to Alison for a review our financial performance, which begins on Page 4 of the slideshow.

Alison Cornell

Thank you, Paul, and good morning, everyone. As all of you know, I was named CFO of Covance in early May. I joined Covance back in 2004 after a 19-year career at AT&T and have worked very closely with Joe, Bill and our operational teams across the company over the course of my tenure here.

I'm very excited to be in this role at a time when I believe there are significant opportunities ahead of us. Since my appointment, I've met with a number of our shareholders and covering analysts and look forward to meeting many more of you in the coming months.

Now let's get to the detailed results. First, let me begin by talking about the special items included in our GAAP results that we have excluded in arriving at our pro forma results this quarter. First, we've excluded revenue of $4.3 million and operating losses up $3.8 million from 3 facilities we began closing. One is our Chandler, Arizona preclinical facility, which we announced during our first quarter earnings call; two is our Phase I clinic in Honolulu, Hawaii; and three is our Phase I clinic in Basel, Switzerland pending completion of customary employee consultations.

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