Pharmaceutical Product Development Inc. has a market cap of $2.96 billion; its shares were traded at around $25 with a P/E ratio of 26.6 and P/S ratio of 2.1. The dividend yield of Pharmaceutical Product Development Inc. stocks is 2.4%. Pharmaceutical Product Development Inc. had an annual average earning growth of 17.1% over the past 10 years. GuruFocus rated Pharmaceutical Product Development Inc. the business predictability rank of 3.5-star.PPDI is in the portfolios of Third Avenue Management, Chuck Royce of Royce& Associates, John Hussman of Hussman Economtrics Advisors, Inc., Jim Simons of Renaissance Technologies LLC, Bruce Kovner of Caxton Associates, Richard Aster Jr of Meridian Fund, Richard Aster Jr of Meridian Fund, George Soros of Soros Fund Management LLC, Jean-Marie Eveillard of First Eagle Investment Management, LLC.
Highlight of Business Operations:Capital expenditures for the three months ended June 30, 2010 totaled $16.0 million. These capital expenditures were primarily for computer hardware and software, scientific equipment for our laboratory units and various leasehold improvements. We made these investments to support our business and to improve the efficiencies of our operations. For the remainder of 2010, we expect to spend between approximately $30 million to $55 million for capital expenditures, primarily for facility expansions and improvements, as well as investments in information technology and new laboratory equipment.
Total net revenue increased $15.3 million to $369.9 million in the second quarter of 2010. The increase in total net revenue resulted from increases in both our Development and Discovery Sciences segment revenue. The Development segment generated net revenue of $333.8 million, which accounted for 90.2% of total net revenue for the second quarter of 2010. The $3.6 million increase in Development segment net revenue was primarily attributable to a $8.2 million increase in net revenue from our laboratory units and our Phase I clinic, offset by a decrease of $4.6 million in our Phase II-IV services. Of the decrease in our Phase II-IV services, $2.6 million was due to the strengthening of the U.S. dollar relative to the euro and pound sterling. The increase in net revenue from our laboratory services was primarily related to the BioDuro acquisition in late 2009.
Total direct costs increased $9.3 million to $192.2 million in the second quarter of 2010 primarily as the result of an increase in Development segment direct costs. Development segment direct costs increased $5.3 million to $163.8 million in the second quarter of 2010. The increase was mainly attributable a $5.7 million reduction in research credits recognized in the second quarter of 2010 compared to the same period in 2009, an increase of $2.0 million in contract labor and subcontractor costs and an increase of $1.3 million in supply costs related to our laboratories. These costs were partially offset by a hedging gain of $0.5 million in the second quarter of 2010 compared to a hedging loss of $1.8 million in the second quarter of 2009, as well as a $1.6 million decrease in personnel costs.
SG&A expenses increased $15.5 million to $112.1 million in the second quarter of 2010. The increase in SG&A expenses was primarily related to a $7.6 million increase in personnel costs primarily related to additional employees from the Excel and BioDuro acquisitions, a $4.9 million increase in facilities and information systems costs, $1.8 million in accounting and legal costs related to our compound partnering spin-off, a $1.3 million increase in non-billable travel, meals and entertainment costs and a $0.8 million increase in contract labor and subcontractor costs. These costs were partially offset by a $2.0 million decrease in bad debt expense.
In October 2009, we committed to invest up to $102.7 million in Celtic Therapeutics Holdings, L.P. As of June 30, 2010, we had invested a total of $32.7 million of the aggregate commitment. We account for this investment under the equity method of accounting. For the three months ended June 30, 2010, we recognized a loss from equity investment of $1.7 million. As of June 30, 2010, our investment balance in Celtic was $27.6 million.
Net income decreased $37.1 million to $21.0 million in the second quarter of 2010, a decrease of 63.9% from $58.1 million in the second quarter of 2009. Net income per diluted share of $0.18 in the second quarter of 2010 represents a 63.3% decrease from $0.49 net income per diluted share in the second quarter of 2009. Net income per diluted shares for the second quarter of 2009 included a $19.5 million gain, net of tax, from the sale of Piedmont Research Center.
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