The earnings call indicates a challenging environment with some positive signals of stabilization. Record free cash flow and strong performance in the Manufacturing segment are notable achievements. However, the decline in organic revenue, particularly in the DSA segment, and challenges with global biopharmaceutical clients weigh on the sentiment. The company's efforts in cost savings and stock repurchases are steps in the right direction, but the current demand environment remains uncertain.

Company Guidance

During the Charles River Laboratories Third Quarter 2024 Earnings Conference Call, the guidance provided included several key metrics and insights into the company's financial performance and future expectations. The company reported a revenue of $1.01 billion for Q3 2024, representing a 1.6% decline on a reported basis and a 2.7% organic revenue decline, primarily due to a decrease in DSA (Discovery and Safety Assessment) revenue. Despite these declines, small and midsized biotech client revenue was stable, and forward-looking demand indicators showed improvement. The operating margin for the quarter was 19.9%, down 60 basis points from the previous year, with earnings per share at $2.59, a 4.8% decrease year-over-year. The company slightly raised its full-year guidance, now expecting a 3% to 4% organic revenue decrease, with non-GAAP earnings per share projected between $10.10 and $10.30. Additionally, restructuring initiatives are anticipated to generate approximately $200 million in cumulative annualized cost savings by 2026. Charles River Laboratories also reported record free cash flow exceeding $200 million for the quarter and highlighted ongoing efforts to optimize their global footprint and enhance operational efficiency.

Record Free Cash Flow

The company generated record free cash flow of over $200 million in the third quarter, an increase from $139.5 million last year.

Manufacturing Segment Growth

Manufacturing Solutions segment revenue increased by 11.8% on an organic basis, driven by strong demand across CDMO, Biologics Testing, and Microbial Solutions businesses.

Cost Savings Initiatives

The restructuring initiatives, including headcount reductions and global footprint optimization, are expected to generate approximately $200 million in cumulative annualized cost savings.

Improvement in Book-to-Bill Ratio

The net book-to-bill ratio improved to the most favorable level since the first quarter of 2023.

Stock Repurchase

The company reinitiated stock repurchases, buying back 500,000 shares for approximately $100 million.

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Charles River Labs (CRL) Earnings, Revenues Date & History

The upcoming earnings date is based on a company’s previous reporting, and may be updated when the actual date is announced

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CRL Earnings History

Report Date	Fiscal Quarter	Forecast / EPS	Last Year's EPS	EPS YoY Change	Slides	Play Transcript
Feb 12, 2025	2024 (Q4)	2.54 / -	2.46	―	―	―
Nov 06, 2024	2024 (Q3)	2.42 / 2.59	2.72	-4.78% (-0.13)
Aug 07, 2024	2024 (Q2)	2.39 / 2.80	2.69	4.09% (+0.11)
May 09, 2024	2024 (Q1)	2.06 / 2.27	2.78	-18.35% (-0.51)
Feb 14, 2024	2023 (Q4)	2.40 / 2.46	2.98	-17.45% (-0.52)
Nov 08, 2023	2023 (Q3)	2.36 / 2.72	2.63	3.42% (+0.09)
Aug 09, 2023	2023 (Q2)	2.64 / 2.69	2.77	-2.89% (-0.08)
May 11, 2023	2023 (Q1)	2.59 / 2.78	2.75	1.09% (+0.03)
Feb 22, 2023	2022 (Q4)	2.75 / 2.98	2.49	19.68% (+0.49)
Nov 02, 2022	2022 (Q3)	2.50 / 2.63	2.7	-2.59% (-0.07)

The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.

Beat

Missed

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CRL Earnings-Related Price Changes

Report Date	Price 1 Day Before	Price 1 Day After	Percentage Change
Nov 06, 2024	$188.68	$214.20	+13.53%
Aug 07, 2024	$228.80	$199.96	-12.60%
May 09, 2024	$235.29	$230.09	-2.21%
Feb 14, 2024	$220.24	$245.12	+11.30%

Earnings announcements can affect a stock’s price. This table shows the stock's price the day before and the day after recent earnings reports, including the percentage change.

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