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West Pharmaceutical Services, Inc. Q1 2010 Earnings Call Transcript

West Pharmaceutical Services, Inc. Q1 2010 Earnings Call Transcript

West Pharmaceutical Services, Inc. (WST)

Q1 2010 Earnings Call

April 29, 2009 9:00 am ET


John Woolford - Westwicke Partners, IR

Don Morel - Chairman and CEO

Bill Federici - CFO


Arnie Ursaner- CJS Securities

Raphael - UBS

Ross Taylor - CL King

Andrew Hilgenbrink - Jefferies & Company

Jim Sidoti - Sidoti & Company



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Welcome to the West Pharmaceutical Services first quarter earnings conference call. At this time, all participants are in a listen-only mode. (Operator instructions) Today's conference is being recorded. If you have any objections, you may disconnect at this time.

Now, I would like to turn today’s meeting over to Mr. John Woolford from Westwicke Partners. Sir, you may begin.

John Woolford

Good morning everyone, and welcome to West’s first quarter 2010 results conference call. We issued our financial results this morning and the release has been posted in the Investors section on the company’s website located at If you have not received a copy of this announcement, please call Westwicke Partners at 443-213-0500 and a copy will be sent to you immediately.

There is also posted on the company’s website a slide presentation that management refers to in their remarks today. The presentation is in PDF format and you may need to download appropriate software in order to view the presentation. A link to a free download of that software is provided at the website.

Before we begin, I remind you that statements being made by management may contain forward-looking statements within the meaning of the U.S. Federal Securities Law and that are based on management's beliefs and assumptions, current expectations, estimates and forecast. Statements that are not historical facts, including statements that are preceded by, followed by, or that include words such as estimate, expect, intend, believe, plan, anticipate and other words in terms of similar meaning are forward-looking statements. West's estimated or anticipated future results, product performance or other non-historical facts are forward-looking and reflect our current perspective on existing trends and information.

Many of the factors that will determine the company's future results are beyond the ability of the company to control or predict. These statements are subject to known or unknown risks or uncertainties, and therefore, actual results could differ materially from past results and those expressed or implied in any forward-looking statement. You should bear this in mind as you consider forward-looking statements. For a non-exclusive list of those factors, which could cause actual results to differ from expectations, please refer to today's press release.

Investors are also advised to consult any further disclosures the company makes on related subjects in the company's 10-K, 10-Q and 8-K reports. The company undertakes no obligation to publicly update forward-looking statements whether as a result of new information, future events or otherwise.

In addition, during today’s call management may make reference to non-GAAP financial measures including adjusted operating profits and adjusted diluted EPS. These measures have no standardized meaning prescribed by U.S. GAAP and therefore, may not be comparable to and should not be viewed as a substitute for U.S. GAAP operating income or diluted EPS.

Reconciliations of the non-GAAP financial measures to the most comparable financial results prepared in conformity to GAAP are provided in the materials accompanying this morning's earnings release. Again this call is being recorded on behalf of West and is copyrighted material. It cannot be rerecorded or rebroadcast without the company's expressed permission. Your participation on this call implies your consent to our taping.

At this time, I would like to turn the call over to Don Morel, Chairman and CEO. Don?

Don Morel

Thanks you, John, and good morning everyone. Welcome to West's 2010 first quarter conference call. Joining me for the call today is Bill Federici, West's Chief Financial Officer and Mike Anderson, our Treasurer and primary Investor Relations contact.

As we work our way through the call this morning, Bill and I will again utilize the PowerPoint slide that's posted on our website and we'll call out the slide number we are referring to in our commentary.

I would also like to remind everyone that we will be reporting our results using the Pharmaceutical Packaging Systems and Pharmaceutical Delivery Systems' segments outlined in our February year-end call.

The Pharmaceutical Packaging Systems segment is comprised of our global component's business which is currently forecasted in the range of $770 million to $790 million in revenues for 2010. This segment has responsibility for brand such as Westar, FluroTec, Envision and NovaPure, in addition to our historic disposable medical device, veterinary, diagnostic and dental products businesses.

Delivery Systems brings together the Tech Group contract manufacturing operations, Medimop, Plastef and programs approaching commercializing such as the Daikyo Crystal Zenith silicone-free syringe system, NovaGuard, a proprietary auto-injector ConfiDose as well as our ongoing innovation programs.

The Delivery Systems segment is expecting sales in the range of $320 million to $330 million for 2010.

Before discussing our Q1 results, I would like to remind those listening that West will host an Investor Day in New York on May 6th beginning at 8 a.m. Details for this meeting and information on attending can be found on slide number three.

The presentations will highlight market trends in our major pharmaceutical and device markets, key growth initiatives in both operating segments to achieve our five-year financial targets and the new product case study that illustrates the timeline for capital investment, production system validation and regulatory and customary approval leading to eventual sales representing a typical West product. There will also be a series of displays highlighting our CZ platform and other new products

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