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Non-Tech : Boron Lepore and Associates--is now the time to buy?
BLPG 0.1000+9.9%Jun 20 4:00 PM EDT

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To: kendall harmon who wrote ()2/4/1999 10:45:00 PM
From: kendall harmon   of 11
 
Bloomberg story on BLPG

Fair Lawn, New Jersey, Feb. 4 (Bloomberg) -- Boron, LePore & Associates Inc. shares fell 44 percent after the marketing company for the drug industry said its chief operating officer is leaving and its fourth-quarter earnings were a cent below estimates.

The company's shares fell 12 5/8 to 16 1/8, making it the third-biggest percentage decliner on U.S. markets.

Fourth-quarter revenue was lower than expected, and the company has provided limited information about what it expects for the first half of this year after losing business from Glaxo Wellcome Plc in the fourth quarter, analysts said. This, coming as Chief Operating Officer Gregory Boron announces his resignation, is causing uncertainty about the company's growth, analysts said. ''Concerns exist over management's ability to replace the discontinued Glaxo contract with new business,'' said James Patricelli, an analyst at Dain Rauscher Wessels, in a report. ''Near-term visibility has been clouded due to uncertainty in the timing and magnitude of business activity in the first half of 1999.''

Patricelli cut his rating on the stock to a ''buy'' from a ''strong buy'' and lowered his earnings estimate for 1999 to 90 cents, down from $1.10.

Founder Quits

The company said Gregory Boron, a founder of the Fair Lawn, New Jersey-based company, is leaving ''to pursue personal interests.'' Boron is 47.

Boron, LePore also said it had net income of $3.1 million, or 24 cents a share, in the fourth quarter, up from $2.7 million, or 25 cents, in the year-ago period, following an increase in the company's shares outstanding. The company was expected to earn 25 cents, based on the average estimate of analysts polled by First Call Corp.

While Gregory Boron said that the company expects 1999 earnings to be in line with estimates, he said the company didn't give many specifics about what it expects for different segments of its revenue. This may be causing investors to question whether the company can continue to expand rapidly, he said. ''Where we didn't necessarily stand up and beat our chest as in the past is (about) the flow of revenue and where it is coming from,'' said Boron, who plans to continue as a consultant with the company, in an interview. ''We need to continue to diversify our client line.''

The company is expected to earn $1.10 a share in 1999, based on the average estimate of four analysts polled by First Call.

Boron, who informed the board of directors of his resignation yesterday, said that he's not planning to sell any of the 721,000 shares he owns in the company. 'Overreaction' ''One man's opinion is that this is a significant overreaction,'' he said. Boron said he's planning to work in the consulting industry for a while rather than looking for another executive position.

Revenue at the company rose 84 percent to $42.8 million from $23.3 million. The amount was less than some analysts were estimating.

Vivek Khanna, an analyst at Salomon Smith Barney, said in a report this morning that he had expected the company to have revenue of $44 million in the quarter. As a result, Khanna, who released the report before the company's earnings conference call, said he's reducing his 1999 earnings estimates to a range of 95 cents to $1.00, down from $1.07.

The company said in October that it had lost contracts with drugmaker Glaxo Wellcome Plc, then its largest customer, to provide arrangements for large speaker training meetings and advisory panels. ''Although we were successful, during the fourth quarter, at replacing symposia business with revenue from new and existing clients, entering 1999, the magnitude and timing of some of this business is undefined,'' said Patrick LePore, chairman and chief executive, in a statement.
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