Charles River Laboratories International, Inc. (CRL) reported fourth-quarter 2024 adjusted earnings per share (EPS) of $2.66, which rose 8.1% year over year. The figure surpassed the Zacks Consensus Estimate by 6.4%.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.On a GAAP basis, the company reported a loss of $4.22 per share against the year-ago quarter’s earnings of $3.62 per share. The company reported full-year 2024 EPS of $10.32, which decreased 3.3% from the prior-year level. ...

Core Insights - Charles River Laboratories (CRL) reported a revenue of $1 billion for the quarter ended December 2024, reflecting a decrease of 1.1% year-over-year, while EPS increased to $2.66 from $2.46 in the previous year [1] - The revenue exceeded the Zacks Consensus Estimate of $975.34 million by 2.79%, and the EPS also surpassed the consensus estimate of $2.50 by 6.40% [1] Revenue Breakdown - Revenue from Research Models and Services was $204.26 million, exceeding the average estimate of $201.13 million by analysts, with a year-over-year increase of 4.3% [4] - Revenue from Discovery and Safety Assessment was $603.35 million, below the average estimate of $566.67 million, showing a decline of 3.6% year-over-year [4] - Revenue from Manufacturing Solutions reached $194.94 million, slightly below the average estimate of $205.81 million, with a year-over-year increase of 1.6% [4] - Revenue from Services was $811.91 million, surpassing the average estimate of $795.10 million, but reflecting a year-over-year decline of 3.1% [4] - Revenue from Products was $190.64 million, exceeding the average estimate of $177.81 million, with an increase of 8.6% compared to the previous year [4] Operating Income Analysis - Non-GAAP operating income for Research Models and Services was $46.54 million, slightly above the average estimate of $45.01 million [4] - Non-GAAP operating income for Discovery and Safety Assessment was $148.98 million, exceeding the average estimate of $132.62 million [4] - Non-GAAP operating income for Manufacturing Solutions was $55.91 million, below the average estimate of $58.54 million [4] - Unallocated Corporate Overhead reported an operating loss of $61.76 million, worse than the average estimate of -$43.28 million [4] - Operating income for Research Models and Services was $13.77 million, significantly below the average estimate of $27.04 million [4] - Operating income for Discovery and Safety Assessment was $62.86 million, falling short of the average estimate of $102.93 million [4] - Manufacturing Solutions reported an operating loss of $182.55 million, compared to the average estimate of a profit of $44.27 million [4] Stock Performance - Over the past month, shares of Charles River have declined by 9.1%, contrasting with a 4.7% increase in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

Core Viewpoint - Charles River Laboratories (CRL) reported quarterly earnings of $2.66 per share, exceeding the Zacks Consensus Estimate of $2.50 per share, and showing an increase from $2.46 per share a year ago [1][2]. Financial Performance - The earnings surprise for the quarter was 6.40%, with the company having surpassed consensus EPS estimates in all four of the last quarters [2]. - Revenues for the quarter reached $1 billion, surpassing the Zacks Consensus Estimate by 2.79%, compared to $1.01 billion in the same quarter last year [3]. - The company has also exceeded consensus revenue estimates in each of the last four quarters [3]. Stock Performance and Outlook - Charles River shares have declined approximately 17.7% since the beginning of the year, while the S&P 500 has gained 4% [4]. - The current consensus EPS estimate for the upcoming quarter is $2.40, with expected revenues of $957.37 million, and for the current fiscal year, the estimate is $9.93 on $3.89 billion in revenues [8]. Industry Context - The Medical Services industry, to which Charles River belongs, is currently ranked in the bottom 47% of over 250 Zacks industries, indicating potential challenges ahead [9]. - The performance of the stock may be influenced by the overall outlook for the industry, as research indicates that the top 50% of Zacks-ranked industries outperform the bottom 50% by more than 2 to 1 [9].

Financial Performance - In 2024, Charles River Laboratories reported total revenue of $4.0 billion, with the Discovery and Safety Assessment (DSA) segment contributing 60.5% of total revenue[20][25]. - The Research Models and Services (RMS) segment accounted for 20.5% of total revenue, employing approximately 4,100 individuals, including around 200 science professionals with advanced degrees[22][23]. - The Manufacturing segment represented 19.0% of total revenue, with approximately 2,800 employees, including about 380 science professionals with advanced degrees[22][26]. - The backlog for the RMS segment was approximately $685 million, for the DSA segment was $2.0 billion, and for the Manufacturing segment was $103 million as of December 28, 2024[116]. Operational Efficiency - Charles River Laboratories operates over 130 sites in more than 20 countries, with plans to close or consolidate approximately 15 additional sites over the next two years to enhance operational efficiency[20]. - The company has focused on improving the efficiency of its global operations to better support clients, particularly in the pharmaceutical and biotechnology sectors[19]. - The company aims to enhance its operating efficiency and maximize shareholder value through restructuring initiatives and global footprint optimization[80]. Service Offerings - The company has a diverse portfolio of services that supports clients from target identification through non-clinical development, aimed at reducing costs and increasing speed to market[14]. - The company offers a full spectrum of discovery services, including target discovery, validation, and preclinical drug candidate delivery, focusing on major therapeutic areas like neuroscience, oncology, and immunology[42]. - The Safety Assessment segment provides a comprehensive range of studies required for regulatory submission across various industries, establishing the company as a global leader in GLP outsourced safety assessment services[43]. - The Biologics Testing Services business supports the safe manufacture of biologic drugs, providing cGMP testing services and viral clearance programs for clinical studies[56]. - The company provides a suite of products and services to support clients' manufacturing activities, ensuring quality and safe production of commercial therapies[26]. Market Opportunities - The market for regulated safety assessment services is estimated to be over 60% outsourced, indicating a significant opportunity for Charles River Laboratories[19]. - The evolving biopharmaceutical R&D business model is expected to drive demand for the company's products and services as clients increasingly outsource drug discovery and development processes[75]. Employee and Workforce Management - As of December 28, 2024, the company's total employee count was approximately 20,100, with 61% located in North America, 32% in Europe, 5% in Asia, and 2% in other regions[104]. - The company reduced its total headcount by approximately 8% since the end of 2023 to align with demand[105]. - The company hired over 2,200 people in fiscal 2024, with a voluntary turnover rate of approximately 11.1%[108]. Commitment to Quality and Compliance - The company maintains compliance with animal welfare and GLP regulations, ensuring high standards in safety assessment facilities[49]. - The company’s global regulatory compliance programs are managed by quality systems, including risk-based internal audit programs[131]. - The company has established corporate data integrity governance to manage regulatory requirements and ensure data quality across its regulated businesses[125]. Innovation and Technology - The company utilizes advanced techniques such as machine learning and artificial intelligence in drug discovery, enhancing the efficiency of candidate selection and optimization[44]. - Digital enhancements are being implemented to streamline processes and improve efficiency in drug research and development[72]. - The company emphasizes digital enhancements to streamline operations and improve client experiences through technology like the Apollo™ cloud-based platform[81]. Strategic Growth Initiatives - Recent acquisitions, including Explora BioLabs in 2022 and SAMDI and Noveprim in 2023, are part of the growth strategy to expand the portfolio and geographic footprint[83]. - The company is committed to a disciplined approach in mergers and acquisitions to enhance scientific capabilities and maintain leadership in advanced therapies[84]. - The strategic partnerships with venture capital firms in life sciences and therapeutics provide insights into emerging technologies and enhance the company's service offerings[85]. Animal Welfare and Ethical Practices - The company is committed to animal welfare and the implementation of the "3Rs" initiative (Replacement, Reduction, and Refinement) in research practices[68]. - The company has established a Responsible Animal Use Committee to improve its impact on responsible animal utilization[103]. - The company’s operations are subject to various international agreements and regulations for the humane treatment and transport of research animals[123].

Revenue Performance - Fourth-quarter revenue was $1.00 billion, a decrease of 1.1% from $1.01 billion in Q4 2023[2] - Full-year revenue decreased by 1.9% to $4.05 billion from $4.13 billion in 2023[16] - The Manufacturing segment's revenue increased by 1.6% to $194.9 million in Q4 2024, with organic revenue growth of 2.1%[14] - The DSA segment's revenue decreased by 3.6% to $603.3 million in Q4 2024, with organic revenue decline of 3.5%[12] - The RMS segment's revenue for 2024 was $829.4 million, an increase of 4.7% from $792.3 million in 2023[19] - Total revenue for the three months ended December 28, 2024, was $1,002,549,000, a decrease of 1.4% compared to $1,013,476,000 for the same period in 2023[34] - Service revenue for the twelve months ended December 28, 2024, was $3,304,138,000, down from $3,440,019,000 in 2023, reflecting a decline of 4.0%[34] - Reported revenue growth for the three months ended December 28, 2024, was a decline of 1.1%, with the RMS segment growing by 4.3% and the DSA segment declining by 3.6%[46] - For the twelve months ended December 28, 2024, reported revenue growth was a decline of 1.9%, with the RMS segment growing by 4.7% and the DSA segment declining by 6.3%[46] - Non-GAAP revenue growth, organic, for the three months ended December 28, 2024, was a decline of 1.8%, with the RMS segment at a decline of 0.4% and the DSA segment at a decline of 3.5%[46] Earnings and Losses - GAAP loss per share for Q4 2024 was $(4.22), a decrease from earnings of $3.62 per share in Q4 2023[6] - Non-GAAP earnings per share for Q4 2024 were $2.66, an increase of 8.1% from $2.46 in Q4 2023[7] - The company reported a net loss of $213,747,000 for the three months ended December 28, 2024, compared to a net income of $188,952,000 for the same period in 2023[34] - Basic earnings per share for the three months ended December 28, 2024, was $(4.22), compared to $3.65 for the same period in 2023[34] - For the three months ended December 28, 2024, Charles River Laboratories reported a net loss of $215.7 million compared to a net income of $187.1 million for the same period in 2023[43] - Non-GAAP net income for the three months ended December 28, 2024, was $136.6 million, up from $127.2 million in the prior year, reflecting a 1.1% increase[43] Financial Guidance and Projections - The company plans to repurchase approximately $350 million in common stock in 2025[1] - 2025 revenue guidance indicates a decrease of 7.0% to 4.5%[23] - Non-GAAP EPS estimate for 2025 is projected to be between $9.10 and $9.60[23] Operational Challenges and Future Outlook - The company expects to face challenges related to NHP supply constraints and ongoing investigations by the U.S. government, which may impact future financial performance[29] - Future revenue trends are anticipated to be influenced by client demand for drug discovery and development products and services[29] - The company continues to assess the potential value of reporting non-GAAP results consistent with applicable rules and regulations[46] Asset and Liability Changes - Total assets decreased from $8,195,001 thousand as of December 30, 2023, to $7,528,345 thousand as of December 28, 2024, representing a decline of approximately 8.1%[36] - Total liabilities decreased from $4,536,003 thousand as of December 30, 2023, to $4,020,267 thousand as of December 28, 2024, a reduction of approximately 11.4%[36] Cash Flow and Expenditures - Cash provided by operating activities increased to $734,577 thousand for the twelve months ended December 28, 2024, compared to $683,898 thousand in the previous year, reflecting a growth of 7.4%[37] - Capital expenditures for the twelve months ended December 28, 2024, were $232,967 thousand, down from $318,528 thousand in 2023, indicating a decrease of 26.9%[37] - Cash, cash equivalents, and restricted cash at the end of the period decreased to $205,570 thousand from $284,480 thousand, a decline of 27.7%[37] Impairments and Charges - The company incurred a goodwill impairment charge of $215,000,000 during the three months ended December 28, 2024[34] - The company reported a goodwill impairment of $215,000 thousand for the twelve months ended December 28, 2024, which was not present in the previous year[37] - The company incurred a $27 million inventory charge related to non-human primate inventory issues[40] - The company reported a severance cost of $12.7 million during the quarter[39] Operating Income and Expenses - Operating income for the twelve months ended December 28, 2024, was $227,347,000, a significant decrease from $617,261,000 in 2023[34] - Operating income (loss) was $(167.7) million, with a significant goodwill impairment charge of $215.0 million recognized[39][40] - Non-GAAP operating income as a percentage of revenue was 19.9%, compared to 20.3% in the previous period[39] - Non-GAAP operating income as a percentage of revenue for the twelve months ended December 28, 2024, was 25.7%, compared to 27.5% in the previous year[38] - Depreciation and amortization expenses were $102.1 million, indicating continued investment in long-term assets[39] Legal and Environmental Issues - Third-party legal costs related to environmental litigation and government investigations impacted financial results[40] - The company experienced a reduction in long-range financial outlook for the Biologics Solutions reporting unit due to loss of key customers[40]

Analysts on Wall Street project that Charles River Laboratories (CRL) will announce quarterly earnings of $2.50 per share in its forthcoming report, representing an increase of 1.6% year over year. Revenues are projected to reach $975.34 million, declining 3.8% from the same quarter last year.Over the past 30 days, the consensus EPS estimate for the quarter has been adjusted downward by 2.6% to its current level. This demonstrates the covering analysts' collective reassessment of their initial projections d ...

Charles River Laboratories International, Inc.’s (CRL) leadership in outsourced drug discovery and safety testing services supports the growth in its DSA (Discovery and Safety Assessment) segment. Through targeted acquisitions and collaborations, the company enhances its offerings across the drug discovery and early-development continuum. Additionally, the RMS (Research Models and Services) segment sees broad-based growth in all geographic regions for small research models. Yet, the adverse macroeconomic im ...

Charles River Laboratories (CRL) is expected to deliver a year-over-year increase in earnings on lower revenues when it reports results for the quarter ended December 2024. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price.The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be release ...

Core Viewpoint - Charles River Laboratories International, Inc. (CRL) is set to report its fourth-quarter 2024 results on February 19, with expectations of mixed performance in revenue and earnings per share (EPS) compared to the previous year [1]. Revenue and Earnings Estimates - The Zacks Consensus Estimate for CRL's revenues is $977.4 million, indicating a 3.6% decline from the same quarter last year [3]. - The Zacks Consensus Estimate for EPS is $2.52, reflecting a 2.4% increase year over year [3]. - In the last reported quarter, CRL's adjusted EPS was $2.59, exceeding the Zacks Consensus Estimate by 6.6%, with an average surprise of 9.35% over the last four quarters [2]. Estimate Revision Trend - Earnings estimates for the fourth quarter have decreased by 0.4% to $2.52 per share in the past 30 days [4]. Segment Performance - The Research Models and Services (RMS) segment is projected to generate revenues of $203 million, suggesting a 3.7% year-over-year improvement, driven by higher pricing and small model sales in China [5][7]. - The Discovery and Safety Assessment (DSA) segment is expected to see revenues of $563.1 million, indicating a 10% decline year over year, influenced by lower revenues in Discovery Services and Safety Assessment [12]. - The Manufacturing Solutions segment is anticipated to show revenue growth across all its businesses, with estimates of $204.7 million, reflecting a 6.6% year-over-year increase [14]. Recent Developments - CRL launched the Retrogenix Non-Human Protein Library to assist biopharmaceutical clients in assessing off-target binding, and entered into a collaboration with H. Lundbeck A/S for brain disease research [9][10]. - The company has initiated several collaborations to enhance the DSA segment, including partnerships with Autobahn Labs and CEBINA GmbH, focusing on advancing academic research in neurodegeneration [10][11]. Earnings ESP and Zacks Rank - CRL has an Earnings ESP of -0.60%, indicating a lower likelihood of beating earnings estimates [15]. - The company currently holds a Zacks Rank of 3 (Hold) [15].

Charles River Laboratories International, Inc. (CRL) has introduced Apollo for CRADL (Charles River Accelerator and Development Lab), a secure cloud-based platform that enhances leading vivarium rental services. The platform connects clients effortlessly with the training, tools and services needed to start research faster. As a digital companion to CRADL’s existing rental space offering, Apollo's centralized dashboard seamlessly connects clients to online training, Charles River’s Research Models Online Or ...