Charles River Laboratories International, Inc. · NYSE:CRL
Charles River Laboratories International — Q3 2025 Earnings Presentation
48 slides from Charles River Laboratories International's earnings presentation, Nov 5, 2025
Slide 1: Charles River Laboratories 3Q 2025 Results
Charles River Laboratories 3Q 2025 Results November 5, 2025 © 2025 Charles River Laboratories International, Inc.
Slide 2: Safe Harbor
Safe Harbor Caution Concerning Forward-Looking Statements. This presentation 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,” “in
Slide 3: Strategic Review Update
Strategic Review Update ▪ Provided an update on our comprehensive strategic review ▪ Board strongly supports CRL’s strategic direction and believes we should continue to focus on: ̶ Strengthening leading scientific portfolio within core markets ̶ Divesting underperforming or non-core assets ̶ Maximi
Slide 4: Focus on Strategic Actions to Further Drive Long-Term Shareholder Value Creation
Focus on Strategic Actions to Further Drive Long-Term Shareholder Value Creation ▪ Strengthening Portfolio by Investing in Core Growth: Continuing to strengthen our portfolio by investing in core growth initiatives, including through M&A, partnerships, and internal development efforts ̶ Have built a
Slide 5: Focus on Strategic Actions to Further Drive Long-Term Shareholder Value Creation, cont.
Focus on Strategic Actions to Further Drive Long-Term Shareholder Value Creation, cont. ▪ Refining Portfolio (cont): Actions are expected to result in sale of certain underperforming or non-core businesses, which will enable us to focus on more profitable growth opportunities ̶ In aggregate, these b
Slide 6: Focus on Strategic Actions to Further Drive Long-Term Shareholder Value Creation, cont.
Focus on Strategic Actions to Further Drive Long-Term Shareholder Value Creation, cont. ▪ Also implementing additional initiatives designed to drive greater operating efficiencies, including through process improvement, procurement synergies, and implementation of a global business services model ▪
Slide 7: Clear Signs That Client Demand Has Stabilized
Clear Signs That Client Demand Has Stabilized ▪ Many global biopharma clients appear to have progressed through their restructuring efforts, and biotech funding environment showed increasing signs of improvement throughout 3Q25 ▪ These are positive signals that the industry may be on a path towards
Slide 8: 3Q25 Demand Trends
3Q25 Demand Trends ▪ 3Q25 business trends were consistent with those we described in August, with: ̶ RMS performance benefiting from favorable timing of NHP shipments in 3Q25 ̶ DSA revenue declining sequentially as 1Q25 bookings strength that contributed to meaningful outperformance in 1H25 returned
Slide 9: 3Q25 Revenue
3Q25 Revenue ($ in millions) 3Q25 3Q24 YOY Δ Organic Δ Revenue $1,004.9 $1,009.8 (0.5)% (1.6)% ▪ Organic revenue declines in DSA and Manufacturing were partially offset by growth in RMS segment ▪ 3Q25 revenue slightly outperformed outlook provided in August ▪ Revenue for small and mid-sized biotech
Slide 10: 3Q25 Operating Margin
3Q25 Operating Margin 3Q25 3Q24 YOY Δ GAAP OM% 13.3% 11.6% 170 bps Non-GAAP OM% 19.7% 19.9% (20) bps ▪ The anticipated non-GAAP operating margin decline primarily reflected lower sales volume in DSA and lower commercial CDMO revenue in Manufacturing ▪ For full year, continue to expect operating marg
Slide 11: 3Q25 EPS
3Q25 EPS 3Q25 3Q24 YOY Δ GAAP EPS $1.10 $1.33 (17.3)% Non-GAAP EPS $2.43 $2.59 (6.2)% ▪ EPS modestly above our prior outlook ▪ The tax rate was most significant YOY headwind as we had anticipated, due to enactment of new tax legislation ─ Tax was non-GAAP EPS headwind of $0.24 per share YOY in 3Q25
Slide 12: Updates 2025 Guidance
Updates 2025 Guidance REVISED PRIOR Revenue growth, reported (1.5)%-(0.5)% (2.5)%-(0.5)% Impact of divestitures/(acquisitions), net N/M N/M (Favorable)/unfavorable impact of FX ~(1.0)% ~(0.5)% Revenue growth, organic (2.5)%-(1.5)% (3.0)%-(1.0)% GAAP EPS estimate $4.15-$4.35 $4.25-$4.65 Acquisition-r
Slide 13: DSA Results – Revenue
DSA Results – Revenue ($ in millions) 3Q25 3Q24 YOY Δ Revenue, reported $600.7 $615.1 (2.3)% (Favorable)/unfavorable impact of FX (1.2)% Impact of divestitures 0.4% Revenue growth, organic (3.1)% ▪ Organic revenue decline driven by lower revenue for both discovery and safety assessment services ▪ As
Slide 14: DSA Demand KPIs
DSA Demand KPIs Period Qtr-End Backlog* Net Bookings* Net Book-to-Bill** ($ in billions) ($ in millions) (Quarterly) 3Q25 $1.80 $494 0.82x 2Q25 $1.93 $506 0.82x 1Q25 $1.99 $616 1.04x 4Q24 $1.97 $510 0.85x 3Q24 $2.12 $522 0.85x ▪ DSA demand environment remained quite stable from trends we described o
Slide 15: DSA Demand KPIs, cont.
DSA Demand KPIs, cont. ▪ Net bookings sequential decrease reflected lighter booking activity for small and mid-sized biotech clients during summer months ▪ Bookings activity from biotech clients improved since summer ̶ Cautiously optimistic that biotech demand will accelerate over the coming quarter
Slide 16: DSA Outlook
DSA Outlook ▪ For 2025, expect DSA revenue will decline by 2.5% to 3.5% on an organic basis ▪ As the focus begins to shift to 2026, we are closely monitoring level of bookings required to drive DSA revenue growth next year ▪ Still too early to provide a preliminary outlook for 2026 because still ful
Slide 17: DSA Results – Operating Margin
DSA Results – Operating Margin 3Q25 3Q24 YOY Δ DSA GAAP OM% 20.5% 20.6% (10) bps DSA Non-GAAP OM% 25.4% 27.4% (200) bps ▪ YOY decline primarily due to impact of lower study volume ▪ Expect 4Q25 DSA operating margin will face additional pressure from two primary factors: ̶ Higher staffing costs due t
Slide 18: RMS Results – Revenue
RMS Results – Revenue ($ in millions) 3Q25 3Q24 YOY Δ Revenue, reported $213.5 $197.8 7.9% (Favorable)/unfavorable impact of FX (1.4)% Revenue growth, organic 6.5% ▪ Higher revenue growth rate was driven by favorable timing of NHP shipments ̶ As previously noted, NHP shipments were accelerated into
Slide 19: RMS Results – Revenue, cont.
RMS Results – Revenue, cont. ▪ From a client perspective, revenue from both academic and government clients increased again in 3Q25, including a slight increase in North America ▪ Have not experienced any meaningful revenue loss related to NIH budgets and the uncertainty in Washington to date, aside
Slide 20: RMS Results – Operating Margin
RMS Results – Operating Margin 3Q25 3Q24 YOY Δ RMS GAAP OM% 16.2% 13.9% 230 bps RMS Non-GAAP OM% 25.0% 21.0% 400 bps ▪ Improvement was primarily due to favorable mix resulting from higher NHP revenue, as well as benefit of cost savings resulting from restructuring initiatives ̶ Previously anticipate
Slide 21: Manufacturing Results – Revenue
Manufacturing Results – Revenue ($ in millions) 3Q25 3Q24 YOY Δ Revenue, reported $190.7 $196.9 (3.1)% (Favorable)/unfavorable impact of FX (2.0)% Revenue growth, organic (5.1)% ▪ Revenue decrease largely driven by lower commercial revenue from CDMO clients ▪ CDMO and Biologics Testing businesses ar
Slide 22: Manufacturing Results – CDMO & Biologics Testing
Manufacturing Results – CDMO & Biologics Testing ▪ CDMO ̶ As discussed throughout the year, relationship with one commercial cell therapy client has ended and the work wound down during 2Q25 ̶ Creates ~$20M revenue headwind for CDMO business in 2H25 when compared to 1H25 ̶ However, we are continuing
Slide 23: Manufacturing Results – Microbial Solutions
Manufacturing Results – Microbial Solutions ▪ Microbial Solutions generated robust revenue growth, and remains on track to grow at a high-single-digit rate for 2025 ▪ Experienced strong demand across our comprehensive manufacturing quality-control testing portfolio, including: ̶ Accugenix® microbial
Slide 24: Manufacturing Results – Operating Margin
Manufacturing Results – Operating Margin 3Q25 3Q24 YOY Δ Manufacturing GAAP OM% 20.9% 20.4% 50 bps Manufacturing Non-GAAP OM% 26.7% 28.7% (200) bps ▪ Non-GAAP operating margin decrease due principally to lower commercial revenue from CDMO clients 24 See ir.criver.com for reconciliations of GAAP to N
Slide 25: NAMs Strategy/Scientific Advisory Board
NAMs Strategy/Scientific Advisory Board ▪ Recent press release launching our Scientific Advisory Board ▪ Former FDA Principal Deputy Commissioner Dr. Namandjé Bumpus will lead the Advisory Board ▪ Board’s mission is to provide strategic guidance to our team of internal scientists and business leader
Slide 26: NAMs Strategy Update, cont.
NAMs Strategy Update, cont. ▪ Highlighting some of our NAMs capabilities utilized across our portfolio, including: ̶ In our Biologics Testing business, next-generation sequencing (NGS) solutions provide an in vitro approach for pathogen testing, as well as genetic characterization of cell lines and
Slide 27: Michael G. Knell Appointed Interim CFO
Michael G. Knell Appointed Interim CFO ▪ Mike Knell has been with CRL since 2017 as Senior Vice President and Chief Accounting Officer ▪ Has agreed to lead the Finance organization through the transition until a new CFO can be named ▪ He is a valuable member of our management team and has worked clo
Slide 28: Updated 2025 Guidance
Updated 2025 Guidance 2025 Guidance Revenue growth/(decrease), reported (1.5)%-(0.5)% Revenue growth/(decrease), organic (2.5)%-(1.5)% GAAP EPS $4.15-$4.35 Non-GAAP EPS $10.10-$10.30 ▪ 3Q25 revenue and non-GAAP EPS modestly exceeded prior outlook ▪ As a result of the 3Q25 outperformance, narrowing r
Slide 29: 2025 Segment Revenue Outlook
2025 Segment Revenue Outlook 2025 Reported 2025 Organic Revenue Growth Revenue Growth(1) RMS Slightly positive Flat to slightly positive DSA Low-single-digit decline (3.5)%-(2.5)% decline Manufacturing Flat to slightly positive Flat to slightly negative Consolidated (1.5)%-(0.5)% decline (2.5)%-(1.5
Slide 30: Unallocated Corporate Expenses
Unallocated Corporate Expenses ($ in millions) 3Q25 2Q25 3Q24 GAAP $63.8 $70.5 $76.8 Non-GAAP $58.9 $60.7 $66.2 ▪ 3Q25 non-GAAP decrease to 5.9% of revenue (from 6.6% in 3Q24) due primarily to lower health and fringe-related costs ▪ Continue to expect 2025 non-GAAP unallocated corporate costs will b
Slide 31: Net Interest Expense
Net Interest Expense ($ in millions) 3Q25 2Q25 3Q24 Interest expense, net $24.0 $28.9 $28.8 ▪ Net interest expense represented both a sequential and YOY decline primarily as a result of shifting debt to lower-interest-rate geographies ▪ Expect total net interest expense will be $100M-$105M consisten
Slide 32: Tax Rate
Tax Rate 3Q25 2Q25 3Q24 GAAP 36.3% 26.2% 23.0% Non-GAAP 28.3% 22.7% 21.3% ▪ Increase in non-GAAP tax rate YOY was primarily due to the impact of the One Big Beautiful Bill Act, or OB3, as well as the impact of the enactment of certain Global Minimum Tax provisions ▪ Continue to expect non-GAAP tax r
Slide 33: Cash Flow
Cash Flow FY 2025 ($ in millions) 3Q25 3Q24 GUIDANCE Free cash flow (FCF) $178.2 $213.1 $470-$500 Capex $35.6 $38.7 ~$200 Depreciation $44.8 $48.5 ~$180 Amortization (1) $40.4 $39.7 ~$230 ▪ 3Q25 FCF YOY decrease from record level last year (in 3Q24) was primarily driven by lower earnings ̶ FCF impro
Slide 34: Robust Free Cash Flow and Stock Repurchases
Robust Free Cash Flow and Stock Repurchases ▪ In October, the Board refreshed stock repurchase authorization to a new, $1.0B authorization ̶ All of which is available for future stock repurchases ▪ We will continue to evaluate the optimal balance between strategic acquisitions, stock repurchases, de
Slide 35: 2025 Guidance Summary
2025 Guidance Summary GAAP Non-GAAP Revenue growth/(decrease) (1.5)%-(0.5%) reported (2.5)%-(1.5)% organic(1) Unallocated corporate ~6.0% of revenue ~5.5% of revenue Operating margin Low-double-digit OM% Flat to 30 bps decrease vs. 2024 Net interest expense $100M-$105M $100M-$105M Tax rate 27.0%-28.
Slide 36: 4Q25 Outlook
4Q25 Outlook 4Q25 Outlook Reported revenue YOY Flat to low-single-digit decline YOY Organic revenue YOY Low- to mid-single-digit decline YOY Non-GAAP EPS Sequential Flat to 10% decline vs. 3Q25 ▪ From a sequential perspective vs. 3Q25: ̶ RMS revenue will be lower due to the acceleration of NHP shipm
Slide 37: Closing Remarks
Closing Remarks ▪ Pleased with our 3Q25 performance, which modestly exceeded our expectations, and with the actions that we will undertake as part of the Board’s strategic review ▪ Initiatives to strengthen our portfolio, maximize financial performance, and maintain a disciplined capital allocation
Slide 38: 3Q25 Regulation G Financial Reconciliations & Appendix
3Q25 Regulation G Financial Reconciliations & Appendix © 2025 Charles River Laboratories International, Inc.
Slide 39: Reconciliation of GAAP to Non-GAAP Selected Business Segment Information
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. RECONCILIATION OF GAAP TO NON-GAAP (1) SELECTED BUSINESS SEGMENT INFORMATION (UNAUDITED) (in thousands, except percentages) Three Months Ended Nine Months Ended September 27, 2025 September 28, 2024 September 27, 2025 September 28, 2024 Research Models
Slide 40: Reconciliation of GAAP to Non-GAAP Selected Business Segment Information
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. RECONCILIATION OF GAAP TO NON-GAAP (1) SELECTED BUSINESS SEGMENT INFORMATION (UNAUDITED) (in thousands, except percentages) Three Months Ended Nine Months Ended September 27, 2025 September 28, 2024 September 27, 2025 September 28, 2024 CONTINUED FROM P
Slide 41: Reconciliation of GAAP Earnings to Non-GAAP Earnings
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. (1) RECONCILIATION OF GAAP EARNINGS TO NON-GAAP EARNINGS (UNAUDITED) (in thousands, except per share data) Three Months Ended Nine Months Ended September 27, 2025 September 28, 2024 September 27, 2025 September 28, 2024 Net income available to Charles R
Slide 42: Reconciliation of GAAP Revenue Growth to Non-GAAP Revenue Growth
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. RECONCILIATION OF GAAP REVENUE GROWTH (1) TO NON-GAAP REVENUE GROWTH, ORGANIC (UNAUDITED) Three Months Ended September 27, 2025 Total CRL RMS Segment DSA Segment MS Segment Revenue growth, reported (0.5)% 7.9 % (2.3)% (3.1)% (Increase) decrease due to f
Slide 43: Reconciliation of GAAP to Non-GAAP Revenue and Earnings Per Share
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. RECONCILIATION OF GAAP TO NON-GAAP REVENUE AND EARNINGS PER SHARE (EPS) Guidance for the Twelve Months Ended December 27, 2025E 2025 GUIDANCE CURRENT PRIOR Revenue growth/(decrease), reported (1.5)% – (0.5)% (2.5)% – (0.5)% Impact of divestitures/(acqui
Slide 44: Reconciliation of GAAP Tax Rate to Non-GAAP Tax Rate
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. RECONCILIATION OF GAAP TAX RATE TO NON-GAAP TAX RATE (UNAUDITED) (1) (in thousands) Three Months Ended Nine Months Ended September 27, 2025 June 28, 2025 September 28, 2024 September 27, 2025 September 28, 2024 Income before income taxes & noncontrollin
Slide 45: Reconciliation of Gross/Net Leverage Ratio to Adjusted EBITDA
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. RECONCILIATION OF GROSS/NET LEVERAGE RATIO, INCLUDING GAAP NET INCOME TO ADJUSTED EBITDA (UNAUDITED) (1) (dollars in thousands, except for per share data) September 27, 2025 June 28, 2025 March 29, 2025 December 28, 2024 December 30, 2023 December 31, 2
Slide 46: Reconciliation of Free Cash Flow
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. RECONCILIATION OF FREE CASH FLOW (NON-GAAP) (UNAUDITED) (1) (in thousands) Three Months Ended Nine Months Ended September 27, 2025 September 28, 2024 September 27, 2025 September 28, 2024 Net cash provided by operating activities $ 213,826 $ 251,792 $ 5
Slide 47: Reconciliation of GAAP to Non-GAAP Selected Business Segment Information
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. RECONCILIATION OF GAAP TO NON-GAAP SELECTED BUSINESS SEGMENT INFORMATION (UNAUDITED) (1) (in thousands, except percentages) Three Months Ended June 28, 2025 Unallocated Corporate Overhead $ (70,494) Add back: Acquisition, integration, and divestiture-re
Slide 48: © 2025 Charles River Laboratories International, Inc.
© 2025 Charles River Laboratories International, Inc.
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