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Charles River Announces Fourth-Quarter and Full-Year 2008 Results and 2009 Guidance
– Company Records Goodwill Impairment of
– Fourth-Quarter GAAP Loss per Share of
– Full-Year GAAP Loss per Share of
– 2009 Guidance of GAAP EPS Between
– Company to Repatriate
On a GAAP basis, the net loss for the fourth quarter of 2008 was
On a non-GAAP basis, net income was
“Our guidance for 2009 reflects our expectation that softer market demand, particularly for preclinical services, will persist at least until mid-year, although we are currently seeing signs of firming demand. We believe that this environment is temporary, and that our clients will continue to outsource drug development services as they strive to improve the efficiency of their drug pipelines. We have had a number of meetings with senior management of our largest clients to discuss opportunities to meaningfully broaden our partnerships with them, and are encouraged by these opportunities.”
“We are using this period of market uncertainty to continue to
streamline our operations, and have implemented actions in the fourth
quarter to improve our operating efficiency and cost structure.
Additional actions will occur in the first quarter, as a result of which
we expect to reduce our operating costs by approximately
First-Quarter Actions
Cost-Saving Initiatives
In order to align our infrastructure for enhanced operating efficiency,
the Company intends to undertake a number of actions in the first
quarter of 2009, the most significant of which is a headcount reduction
of approximately 3% company-wide. The majority of the reductions will
occur in the PCS business segment. As a result of these cost-saving
actions, the Company will take a one-time charge, primarily in the first
quarter of 2009, of approximately
Repatriation
In the first quarter of 2009, the Company expects to repatriate
approximately
Fourth-Quarter Segment Results
Research Models and Services (RMS)
Sales for the RMS segment were
In the fourth quarter of 2008, the RMS segment’s GAAP operating margin
was 26.2% compared to 27.1% in the fourth quarter of 2007. The lower
margin reflected a greater proportion of services in the sales mix, as
well as higher operating costs, particularly in
Preclinical Services (PCS)
Fourth-quarter 2008 net sales for the PCS segment were
On a non-GAAP basis, which excluded the goodwill impairment,
Full-Year Results
For 2008, net sales increased by 9.2% to
On a GAAP basis, the net loss for 2008 was
On a non-GAAP basis, net income for 2008 was
($ in millions) | 2008 | 2007 | ||
Goodwill impairment | $700.0 | -- | ||
Amortization related to acquisitions | $30.3 | $33.5 | ||
Impairment and other charges (1) | $6.7 | $6.3 | ||
Expenses associated with evaluating foregone acquisitions | $1.1 | -- | ||
Gain on U.S. pension curtailment | ($3.3) | -- | ||
Deferred tax revaluation related to convertible debt | $2.9 | -- | ||
Tax impact of Massachusetts tax law change | $1.9 | -- | ||
Tax benefit of repatriation of accumulated foreign earnings | ($4.0) | -- | ||
Stock-based compensation related to Inveresk acquisition | -- | $0.1 | ||
Gain on sale of UK real estate | -- | ($2.0) | ||
Pre-acquisition Inveresk stock compensation taxes | -- | $0.8 | ||
Deferred tax revaluation | -- | ($3.0) |
(1) These items were related primarily to the Company’s disposition or
closure of facilities in
Research Models and Services (RMS)
For 2008, RMS net sales were
Preclinical Services (PCS)
For 2008, PCS net sales were
2009 Guidance
The Company is providing the following guidance for 2009, which is based on current foreign exchange rates. This guidance assumes that the market for outsourced preclinical services will continue to experience more measured spending in 2009 by pharmaceutical and biotechnology clients as a result of restructuring and pipeline reprioritization, budget constraints and reduced funding for small biotechnology companies. The guidance also assumes a stronger second half of the year, and that non-GAAP earnings per share for the first quarter of 2009 will be below the fourth quarter of 2008. The sales guidance is net of the negative impact of foreign exchange, which is expected to reduce the growth rate by approximately 5.0%.
2009 GUIDANCE | ||
Net sales | (2)% - (7)% | |
GAAP EPS estimate | $1.86 - $2.16 | |
Amortization of intangible assets | $0.26 | |
Charges related to cost-saving actions | $0.08 | |
Adoption of FSP APB 14-1 (Convertible debt accounting change) | $0.10 | |
Non-GAAP EPS estimate | $2.30 - $2.60 |
Webcast
Use of Non-GAAP Financial Measures
This press release contains non-GAAP financial measures, such as
non-GAAP earnings per diluted share, which exclude the non-cash goodwill
impairment in the fourth quarter of 2008, amortization of intangible
assets and other charges related to our acquisitions, charges related to
the dispositions of our legacy preclinical facility in
Caution Concerning Forward-Looking Statements
This news 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,” “will,” “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 our projected 2009 sales
and earnings; the future demand for drug discovery and development
products and services (particularly in light of the challenging economic
environment), including the outsourcing of these services and present
spending trends by our customers; the impact of specific actions
intended to improve overall operating efficiencies and profitability;
the timing of the opening of new and expanded facilities by us and our
competitors; our future stock purchase activities; future cost reduction
activities by our customers; and Charles River’s future performance as
delineated in our forward-looking guidance, and particularly our
expectations with respect to sales growth and foreign exchange impact.
In addition, these statements include the availability of funding for
our customers and the impact of economic and market conditions on them
generally, and the anticipated strength of our balance sheet, the
effects of our first-quarter 2009 cost-saving actions and other actions
designed to manage expenses, operating costs and capital spending, and
to streamline efficiency, the timing of our repatriation of accumulated
income earned outside
About Charles River
Accelerating Drug Development. Exactly. 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 nearly 9,000 employees worldwide are focused on providing clients with exactly what they need to improve and expedite the discovery, development through first-in-human evaluation, 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. | ||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) | ||||||||||||||||||
(dollars in thousands, except for per share data) | ||||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||||
December 27, |
December 29, |
December 27, |
December 29, |
|||||||||||||||
Total net sales | $ | 311,447 | $ | 318,028 | $ | 1,343,493 | $ | 1,230,626 | ||||||||||
Cost of products sold and services provided | 199,372 | 200,265 | 832,784 | 752,435 | ||||||||||||||
Gross margin | 112,075 | 117,763 | 510,709 | 478,191 | ||||||||||||||
Selling, general and administrative | 55,339 | 56,535 | 230,159 | 217,491 | ||||||||||||||
Goodwill impairment | 700,000 | - | 700,000 | - | ||||||||||||||
Amortization of intangibles | 7,532 | 9,094 | 30,312 | 33,509 | ||||||||||||||
Operating income | (650,796 | ) | 52,134 | (449,762 | ) | 227,191 | ||||||||||||
Interest income (expense) | (2,155 | ) | (1,339 | ) | (5,318 | ) | (8,321 | ) | ||||||||||
Other income (expense) | (3,429 | ) | 333 | (5,930 | ) | (1,448 | ) | |||||||||||
Income (loss) before income taxes and minority interests | (656,380 | ) | 51,128 | (461,010 | ) | 217,422 | ||||||||||||
Provision for income taxes | 6,279 | 12,181 | 61,944 | 59,400 | ||||||||||||||
Income (loss) before minority interests | (662,659 | ) | 38,947 | (522,954 | ) | 158,022 | ||||||||||||
Minority interests | 351 | 1 | 687 | (470 | ) | |||||||||||||
Income (loss) from continuing operations | (662,308 | ) | 38,948 | (522,267 | ) | 157,552 | ||||||||||||
Income (loss) from discontinued businesses, net of tax | 424 | (2,038 | ) | 424 | (3,146 | ) | ||||||||||||
Net income (loss) | $ | (661,884 | ) | $ | 36,910 | $ | (521,843 | ) | $ | 154,406 | ||||||||
Earnings (loss) per common share | ||||||||||||||||||
Basic: | ||||||||||||||||||
Continuing operations | $ | (9.91 | ) | $ | 0.58 | $ | (7.76 | ) | $ | 2.35 | ||||||||
Discontinued operations | $ | 0.01 | $ | (0.03 | ) | $ | 0.01 | $ | (0.05 | ) | ||||||||
Net income | $ | (9.91 | ) | $ | 0.55 | $ | (7.76 | ) | $ | 2.31 | ||||||||
Diluted: | ||||||||||||||||||
Continuing operations | $ | (9.91 | ) | $ | 0.55 | $ | (7.76 | ) | $ | 2.29 | ||||||||
Discontinued operations | $ | 0.01 | $ | (0.03 | ) | $ | 0.01 | $ | (0.05 | ) | ||||||||
Net income | $ | (9.91 | ) | $ | 0.52 | $ | (7.76 | ) | $ | 2.25 | ||||||||
Weighted average number of common shares outstanding | ||||||||||||||||||
Basic | 66,815,252 | 67,320,340 | 67,273,748 | 66,960,515 | ||||||||||||||
Diluted | 66,815,252 | 70,525,144 | 67,273,748 | 68,735,936 |
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. | ||||||
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) | ||||||
(dollars in thousands) | ||||||
December 27, |
December 29, |
|||||
Assets | ||||||
Current assets | ||||||
Cash and cash equivalents | $ | 243,592 | $ | 225,449 | ||
Trade receivables, net | 210,214 | 213,908 | ||||
Inventories | 96,882 | 88,023 | ||||
Other current assets | 67,218 | 79,477 | ||||
Current assets of discontinued businesses | 233 | 1,007 | ||||
Total current assets | 618,139 | 607,864 | ||||
Property, plant and equipment, net | 828,921 | 748,793 | ||||
Goodwill, net | 457,578 | 1,120,540 | ||||
Other intangibles, net | 136,100 | 148,905 | ||||
Deferred tax asset | 62,935 | 89,255 | ||||
Other assets | 52,058 | 85,993 | ||||
Long-term assets of discontinued businesses | 4,187 | 4,187 | ||||
Total assets | $ | 2,159,918 | $ | 2,805,537 | ||
Liabilities and Shareholders’ Equity | ||||||
Current liabilities | ||||||
Current portion of long-term debt & capital leases | $ | 35,452 | $ | 25,051 | ||
Accounts payable | 40,517 | 36,715 | ||||
Accrued compensation | 54,870 | 53,359 | ||||
Deferred revenue | 86,707 | 102,021 | ||||
Accrued liabilities | 60,741 | 61,366 | ||||
Other current liabilities | 22,676 | 23,268 | ||||
Current liabilities of discontinued businesses | 35 | 748 | ||||
Total current liabilities | 300,998 | 302,528 | ||||
Long-term debt & capital leases | 540,646 | 484,998 | ||||
Other long-term liabilities | 118,827 | 154,044 | ||||
Total liabilities | 960,471 | 941,570 | ||||
Minority interests | 422 | 3,500 | ||||
Total shareholders’ equity | 1,199,025 | 1,860,467 | ||||
Total liabilities and shareholders’ equity | $ | 2,159,918 | $ | 2,805,537 |
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. | |||||||||||||||||
SELECTED BUSINESS SEGMENT INFORMATION (UNAUDITED) | |||||||||||||||||
(dollars in thousands) | |||||||||||||||||
Three Months Ended | Twelve Months Ended | ||||||||||||||||
December 27, |
December 29, |
December 27, |
December 29, |
||||||||||||||
Research Models and Services | |||||||||||||||||
Net sales | $ | 152,841 | $ | 145,153 | $ | 659,941 | $ | 577,231 | |||||||||
Gross margin | 61,141 | 59,177 | 284,639 | 249,348 | |||||||||||||
Gross margin as a % of net sales | 40.0 | % | 40.8 | % | 43.1 | % | 43.2 | % | |||||||||
Operating income | 40,011 | 39,288 | 198,696 | 177,151 | |||||||||||||
Operating income as a % of net sales | 26.2 | % | 27.1 | % | 30.1 | % | 30.7 | % | |||||||||
Depreciation and amortization | 7,468 | 6,366 | 28,186 | 23,378 | |||||||||||||
Capital expenditures | 14,262 | 20,671 | 60,490 | 51,086 | |||||||||||||
Preclinical Services | |||||||||||||||||
Net sales | $ | 158,606 | $ | 172,875 | $ | 683,552 | $ | 653,395 | |||||||||
Gross margin | 50,934 | 58,586 | 226,070 | 228,843 | |||||||||||||
Gross margin as a % of net sales | 32.1 | % | 33.9 | % | 33.1 | % | 35.0 | % | |||||||||
Operating income | (678,944 | ) | 22,678 | (596,437 | ) | 103,541 | |||||||||||
Operating income as a % of net sales | -428.1 | % | 13.1 | % | -87.3 | % | 15.8 | % | |||||||||
Depreciation and amortization | 15,425 | 16,908 | 62,997 | 63,001 | |||||||||||||
Capital expenditures | 32,789 | 68,694 | 136,591 | 175,950 | |||||||||||||
Unallocated Corporate Overhead | $ | (11,863 | ) | $ | (9,832 | ) | $ | (52,021 | ) | $ | (53,501 | ) | |||||
Total | |||||||||||||||||
Net sales | $ | 311,447 | $ | 318,028 | $ | 1,343,493 | $ | 1,230,626 | |||||||||
Gross margin | 112,075 | 117,763 | 510,709 | 478,191 | |||||||||||||
Gross margin as a % of net sales | 36.0 | % | 37.0 | % | 38.0 | % | 38.9 | % | |||||||||
Operating income (loss) | (650,796 | ) | 52,134 | (449,762 | ) | 227,191 | |||||||||||
Operating income as a % of net sales | -209.0 | % | 16.4 | % | -33.5 | % | 18.5 | % | |||||||||
Depreciation and amortization | 22,893 | 23,274 | 91,183 | 86,379 | |||||||||||||
Capital expenditures | 47,051 | 89,365 | 197,081 | 227,036 |
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. | ||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP | ||||||||||||||||
SELECTED BUSINESS SEGMENT INFORMATION (UNAUDITED) (1) | ||||||||||||||||
(dollars in thousands) | ||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 27, |
December 29, |
December 27, |
December 29, |
|||||||||||||
Research Models and Services | ||||||||||||||||
Net sales | $ | 152,841 | $ | 145,153 | $ | 659,941 | $ | 577,231 | ||||||||
Operating income | 40,011 | 39,288 | 198,696 | 177,151 | ||||||||||||
Operating income as a % of net sales | 26.2 | % | 27.1 | % | 30.1 | % | 30.7 | % | ||||||||
Add back: | ||||||||||||||||
Amortization related to acquisitions | 872 | 748 | 2,602 | 1,873 | ||||||||||||
Goodwill impairment | - | - | - | - | ||||||||||||
Impairment and other charges (2) | 901 | - | 1,850 | - | ||||||||||||
Operating income, excluding specified charges (Non-GAAP) | $ | 41,784 | $ | 40,036 | $ | 203,148 | $ | 179,024 | ||||||||
Non-GAAP operating income as a % of net sales | 27.3 | % | 27.6 | % | 30.8 | % | 31.0 | % | ||||||||
Preclinical Services | ||||||||||||||||
Net sales | $ | 158,606 | $ | 172,875 | $ | 683,552 | $ | 653,395 | ||||||||
Operating income | (678,944 | ) | 22,678 | (596,437 | ) | 103,541 | ||||||||||
Operating income as a % of net sales | -428.1 | % | 13.1 | % | -87.3 | % | 15.8 | % | ||||||||
Add back: | ||||||||||||||||
Amortization related to acquisitions | 6,660 | 8,346 | 27,710 | 31,636 | ||||||||||||
Goodwill impairment | 700,000 | - | 700,000 | - | ||||||||||||
Impairment and other charges (3) | 1,190 | 4,587 | 4,423 | 6,269 | ||||||||||||
Gain on sale of UK real estate | - | - | - | (2,047 | ) | |||||||||||
Pre-acquisition Inveresk stock compensation taxes | - | - | - | 845 | ||||||||||||
Operating income, excluding specified charges (Non-GAAP) | $ | 28,906 | $ | 35,611 | $ | 135,696 | $ | 140,244 | ||||||||
Non-GAAP operating income as a % of net sales | 18.2 | % | 20.6 | % | 19.9 | % | 21.5 | % | ||||||||
Unallocated Corporate Overhead | $ | (11,863 | ) | $ | (9,832 | ) | $ | (52,021 | ) | $ | (53,501 | ) | ||||
Add back: | ||||||||||||||||
Impairment and other charges (4) | 416 | - | 416 | - | ||||||||||||
Stock-based compensation related to Inveresk acquisition | - | - | - | 94 | ||||||||||||
Goodwill impairment | - | - | - | - | ||||||||||||
Expensed deal costs | - | - | 1,125 | - | ||||||||||||
U.S. pension curtailment | - | - | (3,276 | ) | - | |||||||||||
Unallocated corporate overhead, excluding specified charges (Non-GAAP) | $ | (11,447 | ) | $ | (9,832 | ) | $ | (53,756 | ) | $ | (53,407 | ) | ||||
Total | ||||||||||||||||
Net sales | $ | 311,447 | $ | 318,028 | $ | 1,343,493 | $ | 1,230,626 | ||||||||
Operating income | (650,796 | ) | 52,134 | (449,762 | ) | 227,191 | ||||||||||
Operating income as a % of net sales | -209.0 | % | 16.4 | % | -33.5 | % | 18.5 | % | ||||||||
Add back: | ||||||||||||||||
Amortization related to acquisition | 7,532 | 9,094 | 30,312 | 33,509 | ||||||||||||
Stock-based compensation related to Inveresk acquisition | - | - | - | 94 | ||||||||||||
Goodwill impairment | 700,000 | - | 700,000 | - | ||||||||||||
Impairment and other charges (2)(3)(4) | 2,507 | 4,587 | 6,689 | 6,269 | ||||||||||||
Expensed deal costs | - | - | 1,125 | - | ||||||||||||
U.S. pension curtailment | - | - | (3,276 | ) | - | |||||||||||
Gain on sale of UK real estate | - | - | - | (2,047 | ) | |||||||||||
Pre-acquisition Inveresk stock compensation taxes | - | - | - | 845 | ||||||||||||
Operating income, excluding specified charges (Non-GAAP) | $ | 59,243 | $ | 65,815 | $ | 285,088 | $ | 265,861 | ||||||||
Non-GAAP operating income as a % of net sales | 19.0 | % | 20.7 | % | 21.2 | % | 21.6 | % | ||||||||
(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 one-time charges, 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 GAAP. The Company intends to continue to assess the potential value of reporting non-GAAP results consistent with applicable rules and regulations. | |||||||||||||||
(2) | Reported results in 2008 include the sale of the Company's Vaccine business in Mexico and closure of the Company's facility in Hungary. | |||||||||||||||
(3) | Reported results in 2008 include the disposition of and accelerated exit from the Company's Worcester, MA facility and severance costs related to cost-saving actions. Reported results in 2007 include the accelerated exit from the Company's Worcester, MA facility. | |||||||||||||||
(4) |
Reported results in 2008 advisory fees incurred in connection with repatriation of accumulated foreign earnings. |
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. | ||||||||||||||||
RECONCILIATION OF GAAP EARNINGS TO NON-GAAP EARNINGS (1) | ||||||||||||||||
(dollars in thousands, except for per share data) | ||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 27, |
December 29, |
December 27, |
December 29, |
|||||||||||||
Net income (loss) | $ | (661,884 | ) | $ | 36,910 | $ | (521,843 | ) | $ | 154,406 | ||||||
Less: Discontinued operations | (424 | ) | 2,038 | (424 | ) | 3,146 | ||||||||||
Net income (loss) from continuing operations | (662,308 | ) | 38,948 | (522,267 | ) | 157,552 | ||||||||||
Add back: | ||||||||||||||||
Amortization related to acquisitions | 7,532 | 9,094 | 30,312 | 33,509 | ||||||||||||
Stock-based compensation related to Inveresk acquisition | - | - | - | 94 | ||||||||||||
Goodwill impairment | 700,000 | - | 700,000 | - | ||||||||||||
Impairment and other charges (2) | 2,507 | 4,587 | 6,689 | 6,269 | ||||||||||||
Expensed deal costs | - | - | 1,125 | - | ||||||||||||
Pension curtailment | - | - | (3,276 | ) | - | |||||||||||
Gain on sale of UK real estate | - | - | - | (2,047 | ) | |||||||||||
Pre-acquisition Inveresk stock compensation taxes | - | - | - | 845 | ||||||||||||
Deferred tax revaluation | - | (2,104 | ) | 2,921 | (3,011 | ) | ||||||||||
Tax effect of goodwill impairment | (2,897 | ) | - | (2,897 | ) | - | ||||||||||
Mass tax law change | 1,897 | - | 1,897 | - | ||||||||||||
Tax benefit of repatriation | (4,045 | ) | - | (4,045 | ) | - | ||||||||||
Tax effect | (3,021 | ) | (4,622 | ) | (10,690 | ) | (12,984 | ) | ||||||||
Net income from continuing operations, excluding specified charges (Non-GAAP) | $ | 39,665 | $ | 45,903 | $ | 199,769 | $ | 180,227 | ||||||||
Weighted average shares outstanding - Basic | 66,815,252 | 67,320,340 | 67,273,748 | 66,960,515 | ||||||||||||
Effect of dilutive securities: | ||||||||||||||||
2.25% senior convertible debentures | - | 1,419,547 | 776,387 | 481,136 | ||||||||||||
Stock options and contingently issued restricted stock | 185,968 | 1,517,587 | 1,009,781 | 1,160,369 | ||||||||||||
Warrants | 3,510 | 267,670 | 87,420 | 133,916 | ||||||||||||
Weighted average shares outstanding - Diluted | 67,004,730 | 70,525,144 | 69,147,336 | 68,735,936 | ||||||||||||
Basic earnings (loss) per share | $ | (9.91 | ) | $ | 0.55 | $ | (7.76 | ) | $ | 2.31 | ||||||
Diluted earnings (loss) per share | $ | (9.91 | ) | $ | 0.52 | $ | (7.76 | ) | $ | 2.25 | ||||||
Basic earnings per share, excluding specified charges (Non-GAAP) | $ | 0.59 | $ | 0.68 | $ | 2.97 | $ | 2.69 | ||||||||
Diluted earnings per share, excluding specified charges (Non-GAAP) | $ | 0.59 | $ | 0.65 | $ | 2.89 | $ | 2.62 | ||||||||
(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 one-time charges, 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 GAAP. The Company intends to continue to assess the potential value of reporting non-GAAP results consistent with applicable rules and regulations. | |||||||||||||||
(2) |
Reported results in 2008 include the sale of the Company's Vaccine business in Mexico and closure of the Company's facility in Hungary; the disposition of and accelerated exit from the Company's Worcester, MA facility; severance costs related to cost-saving actions and advisory fees incurred in connection with repatriation of accumulated foreign earnings. Reported results in 2007 include the accelerated exit from the Company's Worcester, MA facility. |
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. | ||||||||||||||||
RECONCILIATION OF ORGANIC NET SALES GROWTH (1) | ||||||||||||||||
(dollars in thousands) | ||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 27, |
December 29, |
December 27, |
December 29, |
|||||||||||||
Research Models and Services | ||||||||||||||||
Net sales | $ | 152,841 | $ | 145,153 | $ | 659,941 | $ | 577,231 | ||||||||
(Positive)/negative impact of foreign exchange | 3,038 | - | (21,599 | ) | - | |||||||||||
Impact of acquisitions and divestiture, net (2) | (1,904 | ) | (2,305 | ) | (2,223 | ) | (2,305 | ) | ||||||||
Organic sales | 153,975 | 142,848 | 636,119 | 574,926 | ||||||||||||
Organic sales growth | 7.8 | % | 10.6 | % | ||||||||||||
Preclinical Services | ||||||||||||||||
Net sales | $ | 158,606 | $ | 172,875 | $ | 683,552 | $ | 653,395 | ||||||||
(Positive)/negative impact of foreign exchange | 10,454 | - | 6,103 | - | ||||||||||||
Impact of acquisitions and divestiture, net (2) | (4,681 | ) | - | (5,821 | ) | - | ||||||||||
Organic sales | 164,379 | 172,875 | 683,834 | 653,395 | ||||||||||||
Organic sales growth | -4.9 | % | 4.7 | % | ||||||||||||
Total | ||||||||||||||||
Net sales | $ | 311,447 | $ | 318,028 | $ | 1,343,493 | $ | 1,230,626 | ||||||||
(Positive)/negative impact of foreign exchange | 13,492 | - | (15,496 | ) | - | |||||||||||
Impact of acquisitions and divestiture, net (2) | (6,585 | ) | (2,305 | ) | (8,044 | ) | (2,305 | ) | ||||||||
Organic sales | 318,354 | 315,723 | 1,319,953 | 1,228,321 | ||||||||||||
Organic sales growth | 0.8 | % | 7.5 | % | ||||||||||||
(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 one-time charges, 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 GAAP. The Company intends to continue to assess the potential value of reporting non-GAAP results consistent with applicable rules and regulations. | |||||||||||||||
(2) | Acquisitions represent MIR Preclinical Services, completed on September 15, 2008, and NewLab BioQuality AG, completed on September 9, 2008. Divestiture represents the sale of our Vaccine business in Mexico at the end of the third quarter of 2008 (organic growth calculation excludes only fourth-quarter 2007 sales). |
Source:
Charles River Laboratories International, Inc.
Investor Contact:
Susan
E. Hardy, 781-222-6190
Corporate Vice President, Investor Relations
or
Media
Contact:
Amy Cianciaruso, 781-222-6168
Associate Director,
Public Relations