Charles River Laboratories raised its full-year organic growth and earnings-per-share guidance on Tuesday at the Global Healthcare Conference, pointing to accelerating demand in its core discovery services business and improving margins in manufacturing support.
The company's Discovery and Safety Assessment segment posted a net book-to-bill ratio of 1.19, described by management as "spectacular." Bookings rose 13% sequentially and 39% year-over-year, extending a streak of multiple consecutive quarters above the 1.1 threshold that signals healthy pipeline growth.
"Right now, the discussions are, when can you start? When can I get my data? How quickly can I get, and how many molecules can I get into the clinic," CEO Birgit Statham said, noting a shift in client priorities toward speed of execution.
Statham, who became CEO in May after nearly three decades at the company, said her early site visits — more than 40 across roughly seven countries — reinforced confidence that the firm's "Pathway to Purpose" strategy is aligned with customer expectations.
CFO Glenn Sblendorio, who joined the company in April from Premier, characterized the business as being at an "inflection point" with "significant improvement" visible in the second half of the year. Manufacturing Support margins were in the high 30s and are expected to approach 40% by year-end, he said.
The company also highlighted progress on supply chain resilience for non-human primate studies, stating that its owned farms now cover approximately 80% of future needs. China's breeding stock disruption during COVID-era border closures has eased under a new permit system, though new breeding stock will take years to mature. Pricing in China has moderated from previous hyperinflationary levels, management said.
On the divestiture of its cell and gene therapy CDMO business, Sblendorio said the decision was driven by strategic fit and timing rather than weakness in the broader complex modalities market, which requires increasing science and analytical investment.
AI-related demand remains small and not yet a meaningful volume driver, management noted, though they view it as a potential future tailwind. AI-designed molecules still require full validation and regulatory review, delaying near-term impact.
Charles River shares were trading around $278.26, up about 1.93%. An investor day is scheduled for next week.
