Earnings release
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Charles River Laboratories Announces Second-Quarter 2025 Results August 6, 2025 at 7:00 AM EDT – Second-Quarter Revenue of $1.03 Billion – – Second-Quarter GAAP Earnings per Share of $1.06 and Non-GAAP Earnings per Share of $3.12 – – Updates 2025 Guidance – WILMINGTON, Mass.--(BUSINESS WIRE)--Aug. 6, 2025-- Charles River Laboratories International, Inc. (NYSE: CRL) today reported its results for the second quarter of 2025. For the quarter, revenue was $1,032.1 million, an increase of 0.6% from $1,026.1 million in the second quarter of 2024. The impact of foreign currency translation increased reported revenue by 1.2%. Excluding this impact, revenue declined 0.5% on an organic basis. On a segment basis, an organic revenue decline in the Discovery and Safety Assessment (DSA) segment was partially offset by organic revenue growth in the Manufacturing Solutions (Manufacturing) and Research Models and Services (RMS) segments. In the second quarter of 2025, the GAAP operating margin decreased to 9.7% from 14.8% in the second quarter of 2024. GAAP net income available to common shareholders for the second quarter of 2025 was $52.3 million, or $1.06 per share, a decrease from net earnings of $90.0 million, or $1.74 per diluted share, for the same period in 2024. The GAAP decreases were primarily driven by higher amortization expense related to accelerated amortization of certain CDMO client relationships, costs associated with the Company's restructuring activities, and certain third-party legal and advisory costs. On a non-GAAP basis, the second-quarter operating margin increased to 22.1% from 21.3% in the second quarter of 2024. Non-GAAP net income was $154.0 million for the second quarter of 2025, an increase of 6.2% from $144.9 million for the same period in 2024. Second-quarter diluted earnings per share on a non-GAAP basis were $3.12, an increase of 11.4% from $2.80 per share for the second quarter of 2024. The non-GAAP increases were primarily driven by operating margin improvements in all three segments, partially offset by higher unallocated corporate costs. In addition, lower diluted shares outstanding due to the Company's stock repurchase program also contributed to the increase in non-GAAP earnings per share. James C. Foster, Chair, President and Chief Executive Officer, said, “We are continuing to see clear signs that the biopharmaceutical demand is stabilizing, and in this environment, we are making gradual progress to return to organic revenue growth. This progress was demonstrated in our solid second-quarter financial performance, driven principally by favorable results in our DSA segment.” "Our clients understand that what truly differentiates Charles River from the competition is the strength and value proposition of our broad, scientifically distinguished portfolio and leading, non-clinical market position. With many of our global biopharmaceutical clients having progressed through their restructuring efforts and small and mid-sized biotech companies showing consistent demand trends, we believe our leading, early-stage development portfolio is extremely well positioned to succeed as the demand environment improves. The sustained improvement in our businesses may not be linear, but we are pleased that the DSA business – and our overall, non-GAAP financial results – will perform substantially better than we had initially expected this year,” Mr. Foster concluded. Second-Quarter Segment Results Research Models and Services (RMS) Revenue for the RMS segment was $213.3 million in the second quarter of 2025, an increase of 3.3% from $206.4 million in the second quarter of 2024. The impact of foreign currency translation increased revenue by 1.0%. Organic revenue increased by 2.3%, due primarily to higher revenue for large research model products and for research model services, including the Genetically Engineered Models and Services (GEMS) and Insourcing Solutions businesses. In the second quarter of 2025, the RMS segment’s GAAP operating margin increased to 16.8% from 14.5% in the second quarter of 2024. On a non-GAAP basis, the operating margin increased to 25.3% from 23.1%. The GAAP and non-GAAP operating margin increases were primarily driven by the favorable revenue mix related to large research models and operating leverage from higher revenue for research models services, as well as the benefit of cost savings resulting from the Company's restructuring initiatives. Discovery and Safety Assessment (DSA) Revenue for the DSA segment was $618.0 million in the second quarter of 2025, a decrease of 1.5% from $627.4 million in the second quarter of 2024. The impact of foreign currency translation increased DSA revenue by 1.1% and the divestiture of a small DSA site reduced reported revenue by 0.2%. Organic revenue decreased by 2.4%, driven primarily by lower sales volume for both discovery and regulated safety assessment services. In the second quarter of 2025, the DSA segment’s GAAP operating margin decreased to 19.9% from 22.1% in the second quarter of 2024. The GAAP operating margin decline was primarily driven by lower revenue, higher costs associated with the Company's restructuring initiatives, and higher third-party legal costs related to U.S. government investigations into the Company's NHP supply chain. On a non-GAAP basis, the operating margin increased to 27.4% from 27.1% in the second quarter of 2024. The non-GAAP operating margin increase was primarily driven by the benefit of cost savings resulting from the Company's restructuring initiatives, partially offset by lower revenue. Manufacturing Solutions (Manufacturing) Revenue for the Manufacturing segment was $200.8 million in the second quarter of 2025, an increase of 4.4% from $192.3 million in the second
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quarter of 2024. The impact of foreign currency translation increased Manufacturing revenue by 1.5%. Organic revenue increased 2.9%, primarily driven by higher revenue in the Microbial Solutions business, which was partially offset by lower revenue in the Biologics Testing business. The Manufacturing segment’s GAAP operating margin decreased to 6.0% from 19.4% in the second quarter of 2024 as a result of higher amortization expense related to accelerated amortization of certain CDMO client relationships. On a non-GAAP basis, the operating margin increased to 32.8% from 26.6% in the second quarter of 2024, driven primarily by revenue and payments associated with commercial CDMO clients, as well as operating leverage from higher revenue in the Microbial Solutions business. Update on U.S. Department of Justice Investigation into Non-Human Primate Supply Chain In July 2025, the U.S. Department of Interior informed the Company that the U.S. Fish and Wildlife Service had cleared non-human primate (NHP) shipments from late 2022 and early 2023 for legal entry into the United States. Furthermore, in recent weeks, the Company has been advised by the U.S. Department of Justice that the grand jury investigation and the parallel civil investigation relating to these NHP shipments had been closed. Updates 2025 Guidance The Company is updating its 2025 financial guidance, which was previously updated on May 7, 2025. The Company is increasing its full-year outlook for revenue and non-GAAP earnings per share to primarily reflect better-than-expected second-quarter financial results, particularly in the DSA segment, and to a lesser extent, a more favorable impact from foreign exchange. The Company’s 2025 guidance for revenue and earnings per share is as follows: 2025 GUIDANCE CURRENT PRIOR Revenue growth/(decrease), reported (2.5)% – (0.5)%(5.5)% – (3.5)% Impact of divestitures/(acquisitions), net N/M N/M (Favorable)/unfavorable impact of foreign exchange ~(0.5)% ~1.0% Revenue growth/(decrease), organic (1) (3.0)% – (1.0)%(4.5)% – (2.5)% GAAP EPS estimate $4.25 – $4.65 $4.35 – $4.85 Acquisition-related amortization and other acquisition- and integration-related costs (2)~$3.60 ~$3.50 Costs associated with restructuring actions (3) ~$1.40 ~$1.00 Certain venture capital and other strategic investment losses/(gains), net (4) ~$0.17 ~$0.15 Other items (5) ~$0.50 ~$0.30 Non-GAAP EPS estimate $9.90 – $10.30 $9.30 – $9.80 Footnotes to Guidance Table: (1) Organic revenue growth is defined as reported revenue growth adjusted for completed acquisitions and divestitures, as well as foreign currency translation. (2) These adjustments include amortization related to intangible assets, inclusive of the acceleration of amortization expense related to certain CDMO client relationships, as well as the purchase accounting step-up on inventory and certain long-term biological assets. In addition, these adjustments include some costs related to the evaluation and integration of acquisitions and divestitures. (3) These adjustments primarily include site consolidation (including site transition costs), severance, impairment, and other costs related to the Company’s restructuring actions. (4) Certain venture capital and other strategic investment performance only includes recognized gains or losses on certain investments. The Company does not forecast the future performance of these investments. (5) These items primarily relate to (i) certain third-party legal costs related to investigations by the U.S. government into the NHP supply chain related to our DSA segment and (ii) certain third-party advisory costs related to the Company entering into a Cooperation Agreement with a shareholder.
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Webcast Charles River has scheduled a live webcast on Wednesday, August 6th, at 9:00 a.m. ET to discuss matters relating to this press release. To participate, please go to ir.criver.com and select the webcast link. You can also find the associated slide presentation and reconciliations of GAAP financial measures to non-GAAP financial measures on the website. Non-GAAP Reconciliations The Company reports non-GAAP results in this press release, which exclude often-one-time charges and other items that are outside of normal operations. A reconciliation of GAAP to non-GAAP results is provided in the schedules at the end of this press release. Use of Non-GAAP Financial Measures This press release contains non-GAAP financial measures, such as non-GAAP earnings per diluted share, non-GAAP operating income, non-GAAP operating margin, and non-GAAP net income. Non-GAAP financial measures exclude, but are not limited to, the amortization of intangible assets and the purchase accounting step-up adjustment on inventory and certain long term biological assets, and other charges and adjustments related to our acquisitions and divestitures, including incremental dividends attributable to Noveprim noncontrolling interest holders; expenses associated with evaluating and integrating acquisitions and divestitures, including advisory fees and certain other transaction-related costs, as well as fair value adjustments associated with contingent consideration; charges, gains, and losses attributable to businesses or properties we plan to close, consolidate, or divest; severance and other costs associated with our restructuring initiatives; the write-off of deferred financing costs and fees related to debt financing; investment gains or losses associated with our venture capital and certain other strategic equity investments; certain legal costs in our Microbial Solutions business related to environmental litigation and in our DSA segment related to U.S. government investigations into the NHP supply chain and advisory costs related to entering into a Cooperation Agreement with a shareholder; tax effect of all of the aforementioned matters; and adjustments related to the recognition of deferred tax assets expected to be utilized as a result of changes to the our international financing structure and the revaluation of deferred tax liabilities as a result of foreign tax legislation. This press release also refers to our revenue on both a GAAP and non-GAAP basis: on a non-GAAP basis, we define “organic revenue growth” as reported revenue growth adjusted for foreign currency translation, acquisitions, and divestitures. We exclude these items from the non-GAAP financial measures because they are outside our normal operations. There are limitations in using non-GAAP financial measures, as they are not presented in accordance with generally accepted accounting principles, and may be different than non-GAAP financial measures used by other companies. In particular, we believe that the inclusion of supplementary non-GAAP financial measures in this press release helps investors to gain a meaningful understanding of our core operating results and future prospects without the effect of these often-one-time charges, and is consistent with how management measures and forecasts the Company's performance, especially when comparing such results to prior periods or forecasts. We believe that the financial impact of our acquisitions and divestitures (and in certain cases, the evaluation of such acquisitions and divestitures, whether or not ultimately consummated) is often large relative to our overall financial performance, which can adversely affect the comparability of our results on a period-to-period basis. In addition, certain activities and their underlying associated costs, such as business acquisitions, generally occur periodically but on an unpredictable basis. We calculate non-GAAP integration costs to include third-party integration costs incurred post-acquisition. Presenting revenue on an organic basis allows investors to measure our revenue growth exclusive of acquisitions, divestitures, and foreign currency exchange fluctuations more clearly. Non-GAAP results also allow investors to compare the Company’s operations against the financial results of other companies in the industry who similarly provide non-GAAP results. The non-GAAP financial measures included in this press release are not meant to be considered superior to or a substitute for results of operations presented in accordance with GAAP. The Company intends to continue to assess the potential value of reporting non-GAAP results consistent with applicable rules and regulations. Reconciliations of the non-GAAP financial measures used in this press release to the most directly comparable GAAP financial measures are set forth in this press release, and can also be found on the Company’s website at ir.criver.com. Caution Concerning Forward-Looking Statements This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “anticipate,” “believe,” “expect,” “intend,” “will,” “would,” “may,” “estimate,” “plan,” “outlook,” and “project,” and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These statements also include statements regarding Charles River’s expectations regarding the availability of Cambodia-sourced NHPs; the impact of the investigations by the U.S. government into the Cambodia NHP supply chain, including but not limited to Charles River’s ability to cooperate fully with the U.S. government; Charles River’s ability to effectively manage any Cambodia NHP supply impact; the projected future financial performance of Charles River and our specific businesses, including our expectations with respect to the impact of NHP supply constraints and our ability to gain market share; earnings per share; operating margin; client demand, particularly the future demand for drug discovery and development products and services, including our expectations for future revenue trends; our expectations with respect to pricing of our products and services; our expectations with respect to future tax rates and the impact of such tax rates on our business; our expectations with respect to the impact of acquisitions and divestitures, including the Noveprim acquisition, on the Company, our service offerings, client perception, strategic relationships, revenue, revenue growth rates, revenue growth drivers, and earnings; the development and performance of our services and products, including our investments in our portfolio; market and industry conditions including the outsourcing of services and identification of spending trends by our clients and funding available to them; ability to gain market share and capitalize on business opportunities; the impact of our restructuring initiatives, including annualized savings; the impact of our stock repurchase authorization; and Charles River’s future performance, including as delineated in our forward-looking guidance, and particularly our expectations with respect to revenue, the impact of foreign exchange, interest rates, enhanced efficiency initiatives. Forward- looking statements are based on Charles River’s current expectations and beliefs, and involve a number of risks and uncertainties that are difficult to predict and that could cause actual results to differ materially from those stated or implied by the forward-looking statements. Those risks and uncertainties include, but are not limited to: NHP supply constraints and the investigations by the U.S. Department of Justice, including the impact on our projected future financial performance, the timing of the resumption of Cambodia NHP imports into the U.S., our ability to manage supply impact, and potential study delays in our DSA segment attributable to NHP supply constraints; changes and uncertainties in the global economy and financial markets; the ability to successfully integrate businesses we acquire, including Noveprim; the timing and magnitude of our share repurchases; negative trends in research and development spending, negative trends in the level of outsourced services, or other cost reduction actions by our clients; the ability to convert backlog to revenue; special interest groups; contaminations; industry trends; new displacement technologies; USDA and FDA regulations; changes in law; continued availability of products and supplies; loss of key personnel; interest rate and foreign currency exchange rate fluctuations; changes in tax regulation and laws; changes in generally accepted accounting principles; disruptions in the global economy caused by geopolitical conflicts; and any changes in business, political, or economic conditions due to the threat of future terrorist activity in the U.S. and other parts of the world, and related U.S. military action overseas. A further description of these risks, uncertainties, and other matters can be found in the
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Risk Factors detailed in Charles River's Annual Report on Form 10-K as filed on February 19, 2025, as well as other filings we make with the Securities and Exchange Commission. Because forward-looking statements involve risks and uncertainties, actual results and events may differ materially from results and events currently expected by Charles River, and Charles River assumes no obligation and expressly disclaims any duty to update information contained in this press release except as required by law. About Charles River Charles River provides essential products and services to help pharmaceutical and biotechnology companies, government agencies and leading academic institutions around the globe accelerate their research and drug development efforts. Our dedicated employees are focused on providing clients with exactly what they need to improve and expedite the discovery, early-stage development and safe manufacture of new therapies for the patients who need them. To learn more about our unique portfolio and breadth of services, visit www.criver.com. CHARLES RIVER LABORATORIES INTERNATIONAL, INC. SCHEDULE 1 CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (in thousands, except for per share data) Three Months Ended Six Months Ended June 28, 2025 June 29, 2024 June 28, 2025 June 29, 2024 Service revenue $ 840,836 $ 842,900 $ 1,638,759 $ 1,659,762 Product revenue 191,299 183,217 377,544 377,915 Total revenue 1,032,135 1,026,117 2,016,303 2,037,677 Costs and expenses: Cost of services provided (excluding amortization of intangible assets) 584,876 577,383 1,162,304 1,155,547 Cost of products sold (excluding amortization of intangible assets) 90,192 95,021 179,200 183,574 Selling, general and administrative 191,549 169,791 369,348 356,082 Amortization of intangible assets 65,384 32,270 130,648 64,845 Operating income 100,134 151,652 174,803 277,629 Other income (expense): Interest income 1,097 3,010 2,501 5,212 Interest expense (29,967 ) (32,769 ) (57,851 ) (67,770 ) Other income (expense), net 154 (2,240 ) (12,057 ) 3,593
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Income before income taxes 71,418 119,653 107,396 218,664 Provision for income taxes 18,725 25,392 28,825 49,921 Net income 52,693 94,261 78,571 168,743 Less: Net income attributable to noncontrolling interests 367 180 776 1,702 Net income attributable to Charles River Laboratories International, Inc. $ 52,326 $ 94,081 $ 77,795 $ 167,041 Calculation of net income per share attributable to Charles River Laboratories International, Inc. common shareholders Net income attributable to Charles River Laboratories International, Inc. $ 52,326 $ 94,081 $ 77,795 $ 167,041 Less: Adjustment of redeemable noncontrolling interest — 301 — 702 Less: Incremental dividends attributed to noncontrolling interest holders — 3,792 — 9,022 Net income available to Charles River Laboratories International, Inc. common shareholders $ 52,326 $ 89,988 $ 77,795 $ 157,317 Earnings per common share Basic $ 1.06 $ 1.75 $ 1.56 $ 3.06 Diluted $ 1.06 $ 1.74 $ 1.55 $ 3.04 Weighted-average number of common shares outstanding Basic 49,149 51,551 49,913 51,494 Diluted 49,316 51,846 50,089 51,810 CHARLES RIVER LABORATORIES INTERNATIONAL, INC. SCHEDULE 2 CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands, except per share amounts)
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June 28, 2025 December 28, 2024 Assets Current assets: Cash and cash equivalents $ 182,824 $ 194,606 Trade receivables and contract assets, net of allowances for credit losses of $12,838 and $18,301, respectively 767,569 720,915 Inventories 279,550 278,544 Prepaid assets 109,998 103,210 Other current assets 129,921 105,796 Total current assets 1,469,862 1,403,071 Property, plant and equipment, net 1,606,733 1,604,014 Venture capital and strategic equity investments 216,073 218,350 Operating lease right-of-use assets, net 385,756 412,490 Goodwill 2,936,265 2,846,608 Intangible assets, net 602,452 723,400 Deferred tax assets 46,943 42,179 Other assets 296,461 278,233 Total assets $ 7,560,545 $ 7,528,345 Liabilities, Redeemable Noncontrolling Interests and Equity Current liabilities: Accounts payable $ 145,798 $ 140,337 Accrued compensation 227,509 179,418 Deferred revenue 268,340 248,322 Accrued liabilities 231,567 232,010 Other current liabilities 207,224 194,014 Total current liabilities 1,080,438 994,101
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Long-term debt, net and finance leases 2,332,374 2,240,205 Operating lease right-of-use liabilities 453,664 483,789 Deferred tax liabilities 109,273 106,960 Other long-term liabilities 185,210 195,212 Total liabilities 4,160,959 4,020,267 Redeemable noncontrolling interests 39,956 41,126 Equity: Preferred stock, $0.01 par value; 20,000 shares authorized; no shares issued and outstanding — — Common stock, $0.01 par value; 120,000 shares authorized; 51,344 shares issued and 49,209 shares outstanding as of June 28, 2025, and 51,141 shares issued and outstanding as of December 28, 2024 513 511 Additional paid-in capital 1,992,718 1,966,237 Retained earnings 1,889,895 1,812,100 Treasury stock, at cost, 2,136 and zero shares, as of June 28, 2025 and December 28, 2024, respectively (363,338 ) — Accumulated other comprehensive loss (166,467 ) (317,345 ) Total Charles River Laboratories International, Inc. equity 3,353,321 3,461,503 Nonredeemable noncontrolling interest 6,309 5,449 Total equity 3,359,630 3,466,952 Total liabilities, redeemable noncontrolling interests and equity $ 7,560,545 $ 7,528,345 CHARLES RIVER LABORATORIES INTERNATIONAL, INC. SCHEDULE 3 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands) Six Months Ended June 28, 2025 June 29, 2024 Cash flows relating to operating activities
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Net income $ 78,571 $ 168,743 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 239,871 171,439 Long-lived asset impairments 31,203 14,250 Stock-based compensation 30,184 33,325 Deferred income taxes (41,030 ) (13,073 ) Write down of inventories 11,067 3,395 (Gain) loss on venture capital and strategic equity investments, net 12,899 (6,305 ) Provision for credit losses 2,191 4,719 (Gain) loss on divestitures, net (3,376 ) 659 Other, net 2,266 5,695 Changes in assets and liabilities: Trade receivables and contract assets, net (18,490 ) 1,072 Inventories (13,953 ) 9,750 Accounts payable 16,241 (6,436 ) Accrued compensation 38,990 (33,153 ) Deferred revenue 11,306 8,151 Customer contract deposits 568 7,849 Other assets and liabilities, net (22,208 ) (46,657 ) Net cash provided by operating activities 376,300 323,423 Cash flows relating to investing activities Capital expenditures (94,622 ) (118,630 ) Purchases of investments and contributions to venture capital investments (8,090 ) (35,538 ) Proceeds from sale of investments 2,106 12,359 Proceeds from sale of businesses and assets, net 17,441 — Acquisition of businesses and assets, net of cash acquired — (5,479 ) Other, net 347 (370 )
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Net cash used in investing activities (82,818 ) (147,658 ) Cash flows relating to financing activities Proceeds from long-term debt and revolving credit facility 963,363 741,200 Payments on long-term debt, revolving credit facility, and finance lease obligations (887,706 ) (987,344 ) Proceeds from exercises of stock options 1 22,331 Purchase of treasury stock (360,484 ) (18,265 ) Payments of contingent consideration (21,822 ) — Purchase of remaining equity interest of other redeemable noncontrolling interests (19,140 ) (12,000 ) Other, net (6,458 ) (13,434 ) Net cash used in financing activities (332,246 ) (267,512 ) Effect of exchange rate changes on cash, cash equivalents, and restricted cash 17,934 (11,729 ) Net change in cash, cash equivalents, and restricted cash (20,830 ) (103,476 ) Cash, cash equivalents, and restricted cash, beginning of period 205,570 284,480 Cash, cash equivalents, and restricted cash, end of period $ 184,740 $ 181,004 CHARLES RIVER LABORATORIES INTERNATIONAL, INC. SCHEDULE 4 RECONCILIATION OF GAAP TO NON-GAAP SELECTED BUSINESS SEGMENT INFORMATION (UNAUDITED)(1) (in thousands, except percentages) Three Months Ended Six Months Ended June 28, 2025 June 29, 2024 June 28, 2025 June 29, 2024 Research Models and Services Revenue $ 213,271 $ 206,389 $ 426,344 $ 427,296 Operating income 35,786 29,948 79,391 73,097
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Operating income as a % of revenue 16.8 % 14.5 % 18.6 % 17.1 % Add back: Amortization related to acquisitions (2) 10,674 7,357 23,361 17,645 Acquisition, integration, and divestiture-related adjustments (3) — 174 14 337 Severance 3,299 494 3,528 1,034 Asset impairment 2,504 8,418 2,823 13,643 Site consolidation charges 1,616 1,310 2,492 2,931 Total non-GAAP adjustments to operating income $ 18,093 $ 17,753 $ 32,218 $ 35,590 Operating income, excluding non-GAAP adjustments $ 53,879 $ 47,701 $ 111,609 $ 108,687 Non-GAAP operating income as a % of revenue 25.3 % 23.1 % 26.2 % 25.4 % Depreciation and amortization $ 19,710 $ 16,538 $ 41,471 $ 34,661 Capital expenditures $ 3,640 $ 9,313 $ 10,926 $ 29,357 Discovery and Safety Assessment Revenue $ 618,029 $ 627,419 $ 1,210,638 $ 1,232,871 Operating income 122,781 138,376 216,733 253,215 Operating income as a % of revenue 19.9 % 22.1 % 17.9 % 20.5 % Add back: Amortization related to acquisitions (2) 18,212 20,298 36,383 38,894 Acquisition, integration, and divestiture-related adjustments (3) 1,287 5,591 2,348 5,783 Severance 237 2,429 5,216 7,913 Asset impairment 11,911 487 21,697 512 Site consolidation charges 3,928 850 6,705 1,832 Third-party legal and advisory costs (4) 10,817 2,110 21,787 4,301 Total non-GAAP adjustments to operating income $ 46,392 $ 31,765 $ 94,136 $ 59,235
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Operating income, excluding non-GAAP adjustments $ 169,173 $ 170,141 $ 310,869 $ 312,450 Non-GAAP operating income as a % of revenue 27.4 % 27.1 % 25.7 % 25.3 % Depreciation and amortization $ 42,575 $ 47,729 $ 84,659 $ 93,518 Capital expenditures $ 18,500 $ 19,444 $ 53,021 $ 68,403 Manufacturing Solutions Revenue $ 200,835 $ 192,309 $ 379,321 $ 377,510 Operating income 12,061 37,230 3,441 70,911 Operating income as a % of revenue 6.0 % 19.4 % 0.9 % 18.8 % Add back: Amortization related to acquisitions (2) 46,333 10,768 92,410 21,561 Acquisition, integration, and divestiture-related adjustments (3) — 544 — 1,243 Severance (383 ) 1,671 1,821 3,194 Asset impairment 6,157 25 6,358 25 Site consolidation charges 1,670 965 2,976 1,065 Total non-GAAP adjustments to operating income $ 53,777 $ 13,973 $ 103,565 $ 27,088 Operating income, excluding non-GAAP adjustments $ 65,838 $ 51,203 $ 107,006 $ 97,999 Non-GAAP operating income as a % of revenue 32.8 % 26.6 % 28.2 % 26.0 % Depreciation and amortization $ 55,343 $ 20,073 $ 109,966 $ 39,878 Capital expenditures $ 11,161 $ 10,583 $ 28,440 $ 19,445 Unallocated Corporate Overhead $ (70,494 ) $ (53,902 ) $ (124,762 ) $ (119,594 ) Add back: Acquisition, integration, and divestiture-related adjustments (3) 2,161 2,108 2,891 3,637
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Severance 574 1,304 1,576 2,794 Asset impairment 184 — 184 — Site consolidation charges 503 — 669 — Third-party legal and advisory costs (4) 6,376 — 6,376 — Total non-GAAP adjustments to operating expense $ 9,798 $ 3,412 $ 11,696 $ 6,431 Unallocated corporate overhead, excluding non-GAAP adjustments $ (60,696 ) $ (50,490 ) $ (113,066 ) $ (113,163 ) Total Revenue $ 1,032,135 $ 1,026,117 $ 2,016,303 $ 2,037,677 Operating income 100,134 151,652 174,803 277,629 Operating income as a % of revenue 9.7 % 14.8 % 8.7 % 13.6 % Add back: Amortization related to acquisitions (2) 75,219 38,423 152,154 78,100 Acquisition, integration, and divestiture-related adjustments (3) 3,448 8,417 5,253 11,000 Severance 3,727 5,898 12,141 14,935 Asset impairment 20,756 8,930 31,062 14,180 Site consolidation charges 7,717 3,125 12,842 5,828 Third-party legal and advisory costs (4) 17,193 2,110 28,163 4,301 Total non-GAAP adjustments to operating income $ 128,060 $ 66,903 $ 241,615 $ 128,344 Operating income, excluding non-GAAP adjustments $ 228,194 $ 218,555 $ 416,418 $ 405,973 Non-GAAP operating income as a % of revenue 22.1 % 21.3 % 20.7 % 19.9 % Depreciation and amortization $ 119,507 $ 86,082 $ 239,871 $ 171,439 Capital expenditures $ 35,298 $ 39,486 $ 94,622 $ 118,630 (1) Charles River management believes that supplementary non-GAAP financial measures provide useful information to allow investors to gain a meaningful understanding of our core operating results and future prospects, without the effect of often-one-time charges and other items which are outside our normal operations, consistent with the manner in which management measures and forecasts the Company’s performance. The supplementary non-GAAP financial measures included are not meant to be considered superior to, or a substitute for results of operations prepared in accordance with U.S. GAAP. The Company intends to continue to assess the potential value of reporting non-GAAP results consistent with applicable rules, regulations and guidance.
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(2) Amortization related to acquisitions for the three and six months ended June 28, 2025 includes $35.5 million and $71.0 million, respectively, of accelerated amortization of certain client relationships in the Biologics Solutions reporting unit within the Manufacturing Solutions segment. (3) These adjustments are related to the evaluation and integration of acquisitions and divestitures, and primarily include transaction, advisory, certain third-party integration, certain compensation costs, and related costs; as well as fair value adjustments associated with contingent consideration arrangements. (4) Third-party legal and advisory costs incurred within Unallocated Corporate are associated with the execution of the Cooperation Agreement with a shareholder. Within our DSA business, third-party legal costs incurred are associated with investigations by the U.S. government into the NHP supply chain. CHARLES RIVER LABORATORIES INTERNATIONAL, INC. SCHEDULE 5 RECONCILIATION OF GAAP EARNINGS TO NON-GAAP EARNINGS (UNAUDITED)(1) (in thousands, except per share data) Three Months Ended Six Months Ended June 28, 2025 June 29, 2024 June 28, 2025 June 29, 2024 Net income available to Charles River Laboratories International, Inc. common shareholders $ 52,326 $ 89,988 $ 77,795 $ 157,317 Add back: Adjustment of redeemable noncontrolling interest (2) — 301 — 702 Incremental dividends attributable to noncontrolling interest holders (3) — 3,792 — 9,022 Non-GAAP adjustments to operating income (4) 127,079 65,576 239,472 127,017 Venture capital and strategic equity investment (gains) losses, net 1,424 (902 ) 11,393 (6,664 ) (Gain) loss on divestitures (5) — — (3,376 ) 658 Tax effect of non-GAAP adjustments: Non-cash tax provision related to international financing structure (6) — 871 — 1,212 Tax effect of the remaining non-GAAP adjustments (26,837 ) (14,687 ) (52,182 ) (26,715 ) Net income available to Charles River Laboratories International, Inc. common shareholders, excluding non-GAAP adjustments $ 153,992 $ 144,939 $ 273,102 $ 262,549
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Weighted average shares outstanding - Basic 49,149 51,551 49,913 51,494 Effect of dilutive securities: Stock options, restricted stock units and performance share units 167 295 176 316 Weighted average shares outstanding - Diluted 49,316 51,846 50,089 51,810 Earnings per share attributable to common shareholders: Basic $ 1.06 $ 1.75 $ 1.56 $ 3.06 Diluted $ 1.06 $ 1.74 $ 1.55 $ 3.04 Basic, excluding non-GAAP adjustments $ 3.13 $ 2.81 $ 5.47 $ 5.10 Diluted, excluding non-GAAP adjustments $ 3.12 $ 2.80 $ 5.45 $ 5.07 (1) Charles River management believes that supplementary non-GAAP financial measures provide useful information to allow investors to gain a meaningful understanding of our core operating results and future prospects, without the effect of often-one-time charges and other items which are outside our normal operations, consistent with the manner in which management measures and forecasts the Company’s performance. The supplementary non-GAAP financial measures included are not meant to be considered superior to, or a substitute for results of operations prepared in accordance with U.S. GAAP. The Company intends to continue to assess the potential value of reporting non-GAAP results consistent with applicable rules, regulations and guidance. (2) This amount represents accretion adjustments of the Noveprim redeemable noncontrolling interest. (3) This amount represents incremental declared and undeclared dividends attributable to Noveprim noncontrolling interest holders who receive preferential dividends for fiscal year 2024. (4) This amount excludes non-GAAP adjustments attributable to noncontrolling interest holders. (5) The amount included in 2025 relates to a gain on the sale of a DSA site while the amount included in 2024 relates to a loss on the sale of a DSA site. (6) This amount relates to the recognition of deferred tax assets expected to be utilized as a result of changes to the Company's international financing structure. CHARLES RIVER LABORATORIES INTERNATIONAL, INC. SCHEDULE 6 RECONCILIATION OF GAAP REVENUE GROWTH TO NON-GAAP REVENUE GROWTH, ORGANIC (UNAUDITED) (1)
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Three Months Ended June 28, 2025 Total CRL RMS Segment DSA Segment MS Segment Revenue growth, reported 0.6 % 3.3 % (1.5 )% 4.4 % (Increase) decrease due to foreign exchange (1.2 )% (1.0 )% (1.1 )% (1.5 )% Impact of divestitures (2) 0.1 % — % 0.2 % — % Non-GAAP revenue growth, organic (3) (0.5 )% 2.3 % (2.4 )% 2.9 % Six Months Ended June 28, 2025 Total CRL RMS Segment DSA Segment MS Segment Revenue growth, reported (1.0 )% (0.2 )% (1.8 )% 0.5 % (Increase) decrease due to foreign exchange (0.2 )% — % (0.2 )% (0.1 )% Impact of divestitures (2) 0.1 % — % 0.1 % — % Non-GAAP revenue growth, organic (3) (1.1 )% (0.2 )% (1.9 )% 0.4 % (1) Charles River management believes that supplementary non-GAAP financial measures provide useful information to allow investors to gain a meaningful understanding of our core operating results and future prospects, without the effect of often-one-time charges and other items which are outside our normal operations, consistent with the manner in which management measures and forecasts the Company’s performance. The supplementary non-GAAP financial measures included are not meant to be considered superior to, or a substitute for results of operations prepared in accordance with U.S. GAAP. The Company intends to continue to assess the potential value of reporting non-GAAP results consistent with applicable rules, regulations and guidance. (2) Impact of divestitures relates to the sale of a site within DSA. (3) Organic revenue growth is defined as reported revenue growth adjusted for divestitures and foreign exchange. View source version on businesswire.com: https://www.businesswire.com/news/home/20250806873862/en/ Investor Contact: Todd Spencer Corporate Vice President, Investor Relations 781.222.6455 todd.spencer@crl.com Media Contact: Amy Cianciaruso Corporate Senior Vice President, Chief Communications Officer 781.222.6168
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amy.cianciaruso@crl.com Source: Charles River Laboratories International, Inc.