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Dec 28, 2024
Charles River Labs Q4 2024 Earnings Report
Charles River Labs reported a revenue decline and a GAAP net loss in Q4 2024 due to goodwill impairment but saw adjusted earnings growth.
Key Takeaways
Charles River Labs reported Q4 2024 revenue of $1.00 billion, a 1.1% YoY decline, primarily due to weak performance in the DSA and RMS segments. The company posted a GAAP net loss of $215.7 million, largely driven by a $215 million goodwill impairment in the Biologics Solutions unit. However, non-GAAP earnings per share increased by 8.1% YoY, supported by cost reductions and higher Manufacturing segment revenue.
GAAP net loss of $215.7 million due to a $215 million goodwill impairment.
Revenue declined 1.1% YoY to $1.00 billion, with organic revenue down 1.8%.
Non-GAAP EPS rose 8.1% YoY to $2.66, driven by cost savings and higher Manufacturing revenue.
Manufacturing segment grew 1.6%, while DSA revenue declined 3.6% due to lower demand.
Revenue by Segment
Forward Guidance
Charles River expects stable biopharmaceutical demand but anticipates revenue pressure due to lower DSA pricing and weaker CDMO performance.
Positive Outlook
- Cost savings initiatives expected to improve profitability.
- Manufacturing segment remains a key growth driver.
- Stable to slightly improved demand from small and mid-sized biotech clients.
- Company plans to repurchase approximately $350 million in stock.
- Non-GAAP EPS guidance of $9.10 - $9.60 for FY 2025.
Challenges Ahead
- Continued budget constraints from large biopharmaceutical clients.
- DSA segment expected to face pricing headwinds.
- CDMO business to experience lower commercial revenue.
- Organic revenue expected to decline 3.5% - 5.5% YoY.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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