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Manufacturing outpaces lab services growth
May 11, 2011
By: Tim Wright
WuXi PharmaTech 1Q Revenues: $93.6 million (+16%) 1Q Earnings: $18.2 million (+17%) Comments: Laboratory Services revenues grew 12% and Manufacturing Services were up 35% for the quarter. Manufacturing growth was driven by ramp-up of large-scale commercial manufacturing and increased demand for clinical trial materials. Gross margins in manufacturing rose from 19.9% to 26.7%, while Laboratory Services’ gross margins dropped from 41.4% to 39.6% due to higher labor costs, Chinese currency appreciation against the dollar, and depreciation expenses from expansion investments. Exchange rates accounted for $1.2 million of the quarter’s earnings.
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