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Mar 28, 2020
Charles River Labs Q1 2020 Earnings Report
Reported an increase in revenue and non-GAAP EPS, but a decrease in GAAP EPS due to venture capital investment losses that were excluded from non-GAAP results. The COVID-19 pandemic reduced both the reported and organic revenue growth rates.
Key Takeaways
Charles River Laboratories announced strong Q1 2020 results, with revenue up 17.0% year-over-year to $707.1 million and non-GAAP EPS up 31.4% to $1.84. However, GAAP EPS decreased by 8.1% to $1.02 due to venture capital investment losses. The company revised its 2020 guidance due to the expected impact of the COVID-19 pandemic, anticipating a reduction in revenue of approximately $135 to $215 million.
First-quarter revenue was $707.1 million, up 17.0% from Q1 2019.
First-quarter GAAP EPS was $1.02, compared to $1.11 in Q1 2019.
First-quarter non-GAAP EPS was $1.84, up from $1.40 in Q1 2019.
Revised 2020 guidance due to COVID-19 impact, expecting revenue reduction of $135 to $215 million.
Charles River Labs
Charles River Labs
Charles River Labs Revenue by Segment
Revenue by Segment
Research Models and Services Revenue
CapyFin.comDiscovery and Safety Assessment Revenue
CapyFin.comManufacturing Solutions Revenue
CapyFin.com Forward Guidance
Charles River revised its financial guidance for 2020 due to the global COVID-19 pandemic and its expected impact on the Company’s operations, client demand, and its financial results.
Positive Outlook
- Revenue growth, reported: 4.5% – 8.0%
- Revenue growth, organic: 1.5% – 4.5%
- GAAP EPS estimate: $4.25 – $4.60
- Non-GAAP EPS estimate: $6.75 – $7.10
- Free cash flow: $325 – $350 million
Challenges Ahead
- Contribution from acquisitions: ~(4.0%)
- Unfavorable/(favorable) impact of foreign exchange: 0.5% – 1.0%
- Acquisition-related amortization: $1.75 – $1.80
- Charges related to global efficiency initiatives: ~$0.05
- Other items: $0.25 – $0.32
Revenue & Expenses
Visualization of income flow from segment revenue to net income