Corporate expenses totaled $36.5 million in the second quarter of 2010 compared to $36.3 million last quarter and $32.6 million in the second quarter of last year. In 2010, corporate expenses are expected to be approximately 7% of revenue.
Cash and cash equivalents at June 30, 2010 were $291 million, an increase of $23 million from the $268 million at March 31, 2010 and up $87 million from the $204 million at June 30, 2009. The company remains debt free.
Free cash flow (defined as operating cash flow less capital expenditures) for the second quarter of 2010 was $24 million, consisting of operating cash flow of $61 million less capital expenditures of $37 million. Free cash flow year to date was $14 million, consisting of operating cash flow of $81 million less capital expenditures of $67 million. In 2010, we expect free cash flow to be approximately $100 million, net of capital expenditures of approximately $160 million. The free cash flow target for 2010 assumes net Days Sales Outstanding (DSO) at 43 days.
Net Days Sales Outstanding (DSO) were 47 days at June 30, 2010 compared to 42 days at March 31, 2010 and 41 days at June 30, 2009.
The effective tax rate was 24.9% in the second quarter. We expect our effective tax rate to be approximately 25% for 2010.
The Company's investor conference call will be webcast on July 29 at 9:00 am ET. Management's commentary and presentation slides will be available through www.covance.com.
Covance, with headquarters in Princeton, New Jersey, is one of the world's largest and most comprehensive drug development services companies with annual revenues greater than $1.8 billion, global operations in more than 30 countries, and more than 10,000 employees worldwide. Information on Covance's products and services, recent press releases, and SEC filings can be obtained through its website at www.covance.com.
Statements contained in this press release, which are not historical facts, such as statements about prospective earnings, savings, revenue, operations, revenue and earnings growth and other financial results are forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All such forward-looking statements including the statements contained herein regarding anticipated trends in the Company's business are based largely on management's expectations and are subject to and qualified by risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. These risks and uncertainties include, without limitation, competitive factors, outsourcing trends in the pharmaceutical industry, levels of industry research and development spending, the Company's ability to continue to attract and retain qualified personnel, the fixed price nature of contracts or the loss of large contracts, risks associated with acquisitions and investments, the Company's ability to increase order volume, the pace of translation of orders into revenue in late-stage development services, fluctuations in currency exchange rates, and other factors described in the Company's filings with the Securities and Exchange Commission including its Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. The Company undertakes no duty to update any forward looking statement to conform the statement to actual results or changes in the Company's expectations.