Segment Information

9 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

Segment Information

SEGMENT INFORMATION

We have three reporting segments: Clinical Research Services (“CRS”), PAREXEL Consulting Services (“PC”), formerly known as PAREXEL Consulting and Medical Communication Services, and PAREXEL Informatics, Inc. (“PI”), formerly known as Perceptive Informatics, Inc.

• CRS constitutes our core business and includes all phases of clinical research from Early Phase (encompassing the early stages of clinical testing that range from first-in-man through proof-of-concept studies) to Phase II-III and Phase IV, which we call Peri/Post-Approval Services (“PACE”), formerly known as Peri Approval Clinical Excellence. Our services include clinical trials management and biostatistics, data management and clinical pharmacology, as well as related medical advisory, patient recruitment, clinical supply and drug logistics, pharmacovigilance, and investigator site services. We aggregate Early Phase with Phase II-III/PACE due to economic similarities in these operating segments.

• PC provides technical expertise and advice in such areas as drug development, regulatory affairs, product pricing and reimbursement, commercialization and strategic compliance. It also provides a full spectrum of market development, product development, and targeted communications services in support of product launch. Our PC consultants identify alternatives and propose solutions to address client issues associated with product development, registration, and commercialization.

• PI provides information technology solutions designed to help improve clients’ product development and regulatory submission processes. PI offers a portfolio of products and services that includes medical imaging services, ClinPhone^® randomization and trial supply management (“RTSM”), IMPACT^® clinical trials management systems (“CTMS”), DataLabs^® electronic data capture (“EDC”), web-based portals, systems integration, electronic patient reported outcomes (“ePRO”), and LIQUENT InSight® Regulatory Information Management solutions. These services are often bundled together and integrated with other applications to provide eClinical solutions for our clients.

We evaluate our segment performance and allocate resources based on service revenue and gross profit (service revenue less direct costs), while other operating costs are allocated and evaluated on a geographic basis. Accordingly, we do not include the impact of selling, general, and administrative expenses, depreciation and amortization expense, other income (expense), and income tax expense in segment profitability. We attribute revenue to individual countries based upon the revenue earned in the respective countries; however, inter-segment transactions are not included in service revenue. Furthermore, we have a global infrastructure supporting our business segments, and therefore do not identify assets by reportable segment.

Our segment results are as follows:

(in thousands)	Three Months Ended				Nine Months Ended
	March 31, 2014		March 31, 2013		March 31, 2014		March 31, 2013
Service revenue
CRS	$	373,216	$	342,387	$	1,069,675	$	960,134
PC	51,880		50,611		160,949		148,236
PI	67,279		61,495		198,141		162,944
Total service revenue	$	492,375	$	454,493	$	1,428,765	$	1,271,314
Direct costs
CRS	$	255,244	$	246,882	$	748,663	$	709,463
PC	30,420		30,424		94,909		88,563
PI	37,485		34,611		107,278		94,620
Total direct costs	$	323,149	$	311,917	$	950,850	$	892,646
Gross profit
CRS	$	117,972	$	95,505	$	321,012	$	250,671
PC	21,460		20,187		66,040		59,673
PI	29,794		26,884		90,863		68,324
Total gross profit	$	169,226	$	142,576	$	477,915	$	378,668