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 ...

Charles River Laboratories International, Inc. (CRL) has announced the integration of Akron Bio’s (Akron) Closed System Solutions (CSS) line of liquid cytokines produced under current good manufacturing practices (CGMP) into its Cell Therapy Flex Platform for Process Development. The integration enhances closed system processing, which streamlines operations, minimizes risk and improves process robustness.The latest development is expected to strongly boost Charles River’s Manufacturing segment.Potential CR ...

Johnson & Johnson (JNJ) announced that the FDA has issued a complete response letter (“CRL”) to its biologics license application (“BLA”) seeking approval for the subcutaneous (“SC”) formulation of its EGFR/MET inhibitor, Rybrevant, for EGFR-mutated non-small cell lung cancer (“NSCLC”).Rybrevant is currently approved as an intravenous (IV) formulation as a combination therapy for treating NSCLC across different lines of treatment and various mutations.The BLA is seeking approval for a fixed combination of S ...

Charles River Laboratories International, Inc. (CRL) continues to enhance its portfolio through targeted partnerships and acquisitions, poised to drive growth in the upcoming quarters. The company’s RMS (Research Models and Services) is witnessing broad-based growth in all geographic regions for small research models. Sound financial health also bodes well for the stock.  Meanwhile, volatilities in the biopharma industry remain a challenge for Charles River. Intense rivalry from other industry players adds ...

Have you evaluated the performance of Charles River Laboratories' (CRL) international operations for the quarter ending September 2024? Given the extensive global presence of this medical research equipment and services provider, analyzing the patterns in international revenues is crucial for understanding its financial strength and potential for growth.The global economy today is deeply interlinked, making a company's engagement with international markets a critical factor in determining its financial succ ...

Financial Data and Key Metrics - Revenue for Q3 2024 was $1.01 billion, a 1.6% decline on a reported basis and a 2.7% organic decline, driven by lower DSA revenue partially offset by growth in the Manufacturing segment [26] - Operating margin was 19.9%, a 60 basis points decline year-over-year, with improvements in all three business segments but higher unallocated corporate costs impacting the consolidated margin [28] - Earnings per share (EPS) were $2.59, a 4.8% decline from Q3 2023, but exceeded the outlook provided in August due to better-than-expected top-line performance, particularly in the DSA segment [29] - Free cash flow reached a record $213.1 million in Q3 2024, up from $139.5 million in the same period last year, driven by disciplined working capital management and lower capital expenditures [65] Business Segment Performance DSA Segment - DSA revenue was $615.1 million, a 7.4% organic decline, primarily due to lower study volume in both Discovery Services and Safety Assessment businesses [31] - Safety Assessment pricing remained flat year-over-year but is expected to decline slightly in Q4 2024 [32] - The DSA backlog decreased slightly to $2.12 billion at the end of Q3 2024 from $2.16 billion at the end of Q2 2024 [35] - DSA operating margin improved to 27.4%, up 20 basis points year-over-year and 30 basis points sequentially, driven by cost-saving actions [39] RMS Segment - RMS revenue was $197.8 million, a 0.6% organic increase, driven by higher pricing and small model sales volume in China, offset by declines in Research Model Services and Cell Solutions [40] - Small model unit volume declined in North America and Europe due to large pharma restructuring activities and reduced research staff [41] - RMS operating margin increased by 210 basis points to 21%, driven by higher pricing, favorable revenue mix, and cost-saving actions [44] Manufacturing Segment - Manufacturing revenue was $196.9 million, an 11.8% organic increase, driven by strong performance across all businesses, particularly in the CDMO and Biologics Testing segments [45] - The CDMO business saw robust client interest and booking activity, particularly in cell therapy, while Biologics Testing benefited from demand for core testing activities [46][47] - Manufacturing operating margin increased by 420 basis points to 28.7%, driven by higher sales volume across all businesses [51] Market and Client Trends - Revenue from small- and mid-sized biotech clients was stable sequentially, but global biopharmaceutical client revenue declined both sequentially and year-over-year due to tighter budgets and pipeline reprioritization [10][27] - Forward-looking demand indicators for biotech clients improved compared to 2023, but the recovery is expected to be more gradual than anticipated at the beginning of the year [9] - The net book-to-bill ratio for the Safety Assessment business improved to the most favorable levels since Q1 2023, indicating stabilization in demand [33] Strategic Initiatives and Cost Management - The company has implemented restructuring initiatives, including headcount reductions and global footprint optimization, expected to generate $200 million in cumulative annualized cost savings by 2026 [23] - Approximately 15 smaller sites, primarily in the DSA and RMS segments, are being consolidated, with expected annualized net savings of $40 million upon completion in 2026 [21] - The company is focusing on commercial enhancements, including leveraging technology like the Apollo platform and RMS e-commerce initiatives, to improve client experience and gain market share [16] Management Commentary on Market Environment - The biopharmaceutical demand environment remains challenging, with global biopharma clients undergoing restructuring and reprioritization, leading to tighter budgets and reduced spending [10][13] - Management believes the demand environment has stabilized and is not deteriorating further, with forward-looking indicators showing improvement from Q2 levels [11][34] - The company expects current trends, including pricing pressures and gradual recovery in biotech demand, to persist into 2025, impacting year-over-year growth rates [13][74] Capital Allocation and Share Repurchases - The company repurchased 500,000 shares for approximately $100 million in Q3 2024, offsetting annual share count dilution from equity awards [63] - Free cash flow generation and moderating capital intensity have allowed the company to rebalance capital priorities, including modest stock repurchases and debt repayment [24][64] Q&A Session Highlights Biotech Funding Environment - The funding environment for biotech clients has improved compared to 2023, with stable demand indicators, but recovery is expected to be gradual [79] - Interest rate reductions and a more robust IPO market have provided some support, but the overall funding environment remains cautious [78] Large Pharma Demand - Large pharma clients are still undergoing cost-cutting and pipeline reprioritization, but demand trends have stabilized and are not expected to deteriorate further [87][88] - Management expects continued pressure on large pharma demand into 2025, with recovery dependent on client budget finalizations and R&D spending trends [115] DSA Margin Outlook - DSA margins are expected to face pressure in 2025 due to pricing headwinds and the need to offset rising costs with efficiency initiatives [93][94] - The company remains focused on protecting margins through cost-saving actions and footprint optimization [92] Manufacturing Segment Synergies - Over 50% of CDMO clients now utilize Biologics Testing capabilities, demonstrating strong synergies between the two businesses [47][144] - The integration of CDMO and Biologics Testing is expected to continue driving growth and providing a competitive advantage [145] Global Footprint Optimization - The company is consolidating 15 smaller sites, primarily in the DSA and RMS segments, to improve efficiency and reduce overhead costs [21][159] - These optimizations are expected to enhance operating margins and create a more scalable infrastructure for future growth [160]