PAREXEL International is shedding up to 850 positions as part of a restructuring programme designed to ramp up productivity and efficiency.
The US-based biopharmaceutical services provider, which employs just under 17,500 people around the globe, said it expects to book a charge of $30 million to $40 million in employee separation benefits related to lay-offs.
But its ‘margin acceleration programme’ is also expected to bring annual pre-tax savings of between $20 million-$30 million in the firm’s fiscal year 2016, and $50 million-$60 million once fully completed.
The announcement came alongside new guidance lowering expectations for fourth quarter revenue. PAREXEL now expects sales of $517 million to $533 million for the period, slipping from earlier predications of $520 million-$540 million.
The firm also noted that it is raising its long-term adjusted operating margin target from 12%-14% of service revenue to 13%-15%.
According to Josef H. von Rickenbach, PAREXEL’s chairman and chief executive, the planned restructure will “strengthen the company by increasing our competitiveness in the marketplace, and will help us to deliver long-term sustainable growth in revenue and margins”.