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For 2001, the Company's sales increased 52% to $465.6 million, an increase of $159 million over sales of $306.6 million in 2000. Net income before an extraordinary loss of $5.2 million related to the early retirement of debt, was $40.7 million, or $0.92 per fully diluted share.
The Company experienced strong sales and earnings growth in the fourth quarter from both its biomedical products and services and research models segments. While strategic acquisitions earlier in the year contributed significantly to results, the Company also experienced solid organic growth across most product lines and services offerings, and throughout North America, Europe and Japan.
Commenting on these results, James C. Foster, Chairman and CEO, said "We're extremely pleased with our results for the fourth quarter, and the year. Despite a challenging overall economy, our businesses remained strong and steady. We experienced excellent growth and profitability across all of our businesses, with revenue growth well above our long-term strategic goal. Demand for our products and services remained robust throughout the quarter and year, fueled by increased R&D spending by big pharma and biotech, and by increased outsourcing of pre-clinical research to companies like ours that have demonstrated exceptional quality, service and reliability. While our research models segment contributed strongly to earnings and cash flow, our acquisitions early in the year of Primedica and PAI added more than $100 million to our revenues in 2001, and enabled Charles River to emerge as a world leader in pre-clinical drug discovery and development services. The vitality of our markets, the increasing trend toward pre-clinical outsourcing, and Charles River's technology and market leadership in the drug discovery and development industry position us for steady, continued growth internationally through 2002."
The Company also announced that the tender offer by its operating subsidiary for its 13.5% senior subordinated notes is expected to be completed next week. The parent will utilize a portion of the cash proceeds from its recent $175 million 3.5% convertible debenture offering to retire the subsidiary's high yield bonds.
The following forward looking guidance is subject to the qualifications set forth below, and is based on current exchange rates. For 2002, Charles River estimates sales growth in the range of 14% to 15%. Fully diluted EPS for 2002 is estimated to be in the range of $1.18 to $1.21, slightly higher than previous guidance as a result of the accretive impact of the Company's recently completed $175 million convertible debenture offering. In the first quarter of 2002, Charles River expects sales in the range of $125 to $130 million, and fully diluted EPS in the range of $0.25 to $0.27, excluding an extraordinary loss related to the retirement of high yield debt pursuant to the tender offer.
Charles River Laboratories International, Inc. is a holding company for Charles River Laboratories, Inc. Both companies are publicly registered, and each files separate financial statements and reports with the Securities Exchange Commission. The income statement and balance sheet information provided below reflect the financial results for Charles River Laboratories International, Inc., which differ from those of Charles River Laboratories, Inc. as to certain balance sheet items.
Charles River Laboratories, based in Wilmington, Massachusetts, is a leading provider of critical research tools and integrated support services that enable innovative and efficient drug discovery and development. The Company is the global leader in providing the animal research models required in research and development for new drugs, devices and therapies. The Company also offers a broad and growing portfolio of biomedical products and services that enable customers to reduce cost, increase speed, and enhance productivity and effectiveness in drug discovery and development. Charles River's customer base spans over 50 countries, and includes all of the major pharmaceutical and biotechnology companies, as well as many leading hospitals and academic institutions. The Company operates 76 facilities in 15 countries worldwide. For more information, visit the Company's web site at http://www.criver.com.
Caution Concerning Forward-Looking Statements: This document includes certain "forward looking statements" within the meaning of The Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations, and involve a number of risks and uncertainties that could cause actual results to differ materially from those stated or implied by the forward looking statements, including acquisition integration risks, special interest groups, contaminations, industry trends, new displacement technologies, outsourcing trends, USDA and FDA regulation, changes in law, special interest groups, continued availability of products and supplies, personnel and control, and others that are described in more detail in the Risk Factors contained in the Company's most recent Registration Statement, filed on Form S-3, as of July 19, 2001, as well as its other periodic SEC filings. The Company disclaims any intent or obligation to update forward looking statements, and otherwise claims the safe harbor protections for forward looking statements afforded under The Private Securities Litigation Reform Act of 1995.
As previously announced, investors can access a live webcast of the fourth quarter earnings conference call through a link that will be posted on the investor page of the Charles River Laboratories website, www.criver.com. The conference call begins on Thursday, February 7, at 8:30 a.m. Eastern Standard Time and will be available thereafter for replay.
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 December December December 29, 2001 30, 2000 29, 2001 30, 2000 Total Net Sales $126,094 $81,058 $465,630 $306,585 Cost of products sold and services provided 82,486 50,520 298,379 186,654 Gross margin 43,608 30,538 167,251 119,931 Selling, general and administrative 18,554 15,838 68,315 51,204 Amortization of goodwill and intangibles 2,649 932 8,653 3,666 Operating income 22,405 13,768 90,283 65,061 Interest income (expense) (3,909) (6,425) (21,304) (39,047) Other income (expense) (16) 247 500 71 Income before taxes, minority interests, earnings from equity investments and extraordinary item 18,480 7,590 69,479 26,085 Provision for income taxes 7,204 3,040 27,095 7,837 Income before minority interests, earnings from equity investments and extraordinary item 11,276 4,550 42,384 18,248 Minority interests (347) (266) (2,206) (1,396) Earnings from equity investments 127 144 472 1,025 Net income before extraordinary item 11,056 4,428 40,650 17,877 Extraordinary loss, net of tax benefit (2,139) -- (5,243) (29,101) Net income (loss) $ 8,917 $4,428 $35,407 $ (11,224) Earnings per common share before extraordinary item Basic $ 0.25 $ 0.12 $ 0.99 $ 0.64 Diluted $ 0.24 $ 0.11 $ 0.92 $ 0.56 Earnings (loss) per common share after extraordinary item Basic $ 0.20 $ 0.12 $ 0.86 $(0.40) Diluted $ 0.19 $ 0.11 $ 0.80 $(0.35) Weighted average number of common shares outstanding Basic 44,133,268 35,920,369 40,998,558 27,737,677 Diluted 46,398,266 40,194,560 44,215,383 31,734,354 CHARLES RIVER LABORATORIES INTERNATIONAL, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (dollars in thousands) December 29, December 30, 2001 2000 Assets Current assets Cash and cash equivalents $ 58,271 $ 33,129 Trade receivables 98,478 45,949 Inventories 39,056 33,890 Other current assets 14,349 6,769 Total current assets 210,154 119,737 Property, plant and equipment, net 155,919 117,001 Goodwill and other intangibles 90,374 41,893 Deferred tax asset 84,387 105,027 Other assets 27,134 26,950 Total assets $567,968 $410,608 Liabilities and Shareholders' Equity Current liabilities Current portion of long-term debt $ 759 $ 231 Accounts payable 13,868 10,767 Accrued compensation 25,736 16,997 Other current liabilities 58,169 36,325 Total current liabilities 98,532 64,320 Long-term debt 155,506 201,957 Other long-term liabilities 14,826 14,074 Total liabilities 268,864 280,351 Minority interests 12,988 13,330 Total shareholders' equity 286,116 116,927 Total liabilities and shareholders' equity $567,968 $410,608 CHARLES RIVER LABORATORIES INTERNATIONAL, INC. SELECTED BUSINESS SEGMENT INFORMATION (UNAUDITED) (dollars in thousands) Three Months Ended Twelve Months Ended December December December December 29, 2001 30, 2000 29, 2001 30, 2000 Research Models Net sales $49,360 $45,412 $197,494 $ 177,950 Gross margin 18,085 16,614 80,060 70,641 Gross margin as a % of sales 36.6% 36.6% 40.5% 39.7% Operating income 10,450 6,742 50,878 40,862 Operating income as a % of sales 21.2% 14.8% 25.8% 23.0% Depreciation and amortization 2,768 2,718 9,978 9,840 Capital expenditures 3,718 2,878 10,419 7,502 Biomedical Products and Services Net sales $76,734 $35,646 $268,136 $ 128,635 Gross margin 25,523 13,924 87,191 49,290 Gross margin as a % of sales 33.3% 39.1% 32.5% 38.3% Operating income 12,293 7,603 46,643 26,308 Operating income as a % of sales 16.0% 21.3% 17.4% 20.5% Depreciation and amortization 5,166 1,774 17,197 6,926 Capital expenditures 12,158 4,158 25,987 8,063 Unallocated Corporate Overhead ($ 338) ($ 577) ($ 7,238) ($ 2,109) Total Net sales $ 126,094 $81,058 $465,630 $ 306,585 Gross margin 43,608 30,538 167,251 119,931 Gross margin as a % of sales 34.6% 37.7% 35.9% 39.1% Operating income 22,405 13,768 90,283 65,061 Operating income as a % of sales 17.8% 17.0% 19.4% 21.2% Depreciation and amortization 7,934 4,492 27,175 16,766 Capital expenditures 15,876 7,036 36,406 15,565
CONTACT: Charles River Laboratories, Christopher DiFrancesco, 978-658-6000 ext. 1329 email@example.com