News Column

Charles River Laboratories Announces Second-Quarter 2014 Results from Continuing Operations

August 23, 2014

By a News Reporter-Staff News Editor at Investment Weekly News -- Charles River Laboratories International, Inc. (NYSE: CRL) reported its results for the second quarter of 2014. For the quarter, revenue from continuing operations was $341.2 million, an increase of 16.5% from $292.9 million in the second quarter of 2013. On a non-GAAP basis, second-quarter revenue increased 15.9%. The acquisition of Argenta and BioFocus, which was completed on April 1, 2014, contributed 8.0% to second-quarter revenue, and foreign currency translation benefited reported revenue by 1.4%.

On a GAAP basis, net income from continuing operations for the second quarter of 2014 was $36.5 million, or $0.75 per diluted share, compared to $28.6 million, or $0.58 per diluted share, for the second quarter of 2013.

On a non-GAAP basis, net income from continuing operations was $46.3 million for the second quarter of 2014, an increase of 29.7% from $35.7 million for the same period in 2013. Second-quarter diluted earnings per share on a non-GAAP basis were $0.97, an increase of 32.9% compared to $0.73 per share in the second quarter of 2013. Higher revenue and operating margin improvement were the primary drivers behind the earnings per share increase. A gain on the Company's limited partnership investments contributed $0.04 per share.

James C. Foster, Chairman, President and Chief Executive Officer, said, "We are very pleased with the second-quarter performance, which is one of the strongest we have ever reported. Double-digit sales growth for the EMD, Biologics, and safety assessment businesses, and the acquisition of Argenta and BioFocus, drove mid-teens revenue growth in the quarter. Leverage from higher sales and our efficiency initiatives combined to generate a 33% increase in non-GAAP earnings per share. As a result, we are increasing our 2014 non-GAAP earnings guidance to a range of $3.25 to $3.35."

"We are continuing our focus on targeted sales efforts, which have been particularly successful with the mid-tier clients. And now that we have broadened our early-stage portfolio with the addition of early discovery capabilities, we are engaging in expanded discussions with existing clients and reaching potential clients who are interested in outsourcing entire drug discovery and development programs to a single provider. We believe these discussions will result in expanded and new strategic relationships across our global, mid-tier, and academic clients," Mr. Foster concluded. Business Segment Revision During the second quarter of 2014, following the acquisition of Argenta and BioFocus on April 1, 2014, Charles River revised its financial reporting segments to ensure alignment with its view of the business. The Company reviewed discrete financial information, the new and existing markets addressed by each business, and its recently revised go-to-market strategy. As a result of this review, the Company has determined that its financial results should be reported in three segments: Research Models and Services (RMS), Discovery and Safety Assessment (DSA), and Manufacturing Support (Manufacturing).

Management believes that the new business segments reflect results of operations and facilitate investors' understanding of the Company's business. The changes in segment presentation have no effect on consolidated revenue or net income. The business segment details discussed in this press release are based on the new business segments. Comparable prior periods have been recast based on the new business segments since the first quarter of 2012, and this quarterly financial information is provided in the schedules at the end of this press release.

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Source: Investment Weekly News

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