Charles River Laboratories (CRL) reported second quarter 2013 earnings (excluding special items) of 73 cents per share, above the Zacks Consensus Estimate of 71 cents, but down 2.7% year over year.
Charles River’s net sales increased 2.9% year over year to $292.9 million in the second quarter of 2013. However, net sales missed the Zacks Consensus Estimate of $295 million.
Foreign currency movements negatively impacted sales by 1.1% in the second quarter of 2013.
Quarter in Detail
Charles River operates through two segments — Research Models & Services (RMS) and Preclinical Services (PCS).
Revenues from the RMS segment were $179.0 million in the second quarter of 2013, up 3.1% from the year-ago quarter. Foreign currency movement hurt sales by 1.5% in the reported quarter. Excluding this impact, RMS segment revenues increased by 5.5% year over year.
The increase in RMS segment sales was due to the performance of the Endotoxin and Microbial Detection (EMD) business and the Accugenix and Vital River acquisitions.
Revenues from the PCS segment were $114.0 million in the second quarter, up 2.6% year over year with performance being driven by higher sales to large biopharmaceutical as well as mid-tier clients mainly due to market share gains.
During the second quarter of 2013, Charles River repurchased 389,000 shares worth $16.6 million, subsequent to which the company has $31.8 million remaining under its $750 million repurchase program.
Moreover, the Board of Directors increased the stock repurchase authorization by $100 million on Jul 30, 2013.
Outlook for 2013 Backed
Charles River maintained its guidance for 2013. The company continues to expect adjusted earnings per share between $2.80 and $2.90 per share. The Zacks Consensus Estimate of $2.82 per share is within the company’s guidance range.
Charles River expects sales growth of 3.0% – 5.0%. On a constant currency basis, sales are still expected to grow in the range of 4.0% –6.0%.
Currently, Charles River carries a Zacks Rank #3 (Hold). Right now, Omnicare Inc. (OCR), MedAssets, Inc. (MDAS) and Parexel International Corporation (PRXL) look better placed with a Zacks Rank #2 (Buy).
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