Charles River Laboratories sees 23.3% revenue growth for 2016
The company has also completed the divestment of its CDMO business Quotient Clinical for US $75m
Charles River Laboratories International reported its full-year 2016 results and provided guidance for 2017.
For the fourth quarter, revenue from continuing operations was $466,8m, an increase of 31.9% from $353,9m in the fourth quarter of 2015.
Revenue growth was driven primarily by the Discovery and Safety Assessment and Manufacturing Support segments. Research Models and Services revenue also increased.
For the full year to the end of 2016, revenue increased by 23.3% to $1.68bn from $1.36bn in 2015. Organic revenue growth was 7.7%.
The acquisitions of WIL Research, Agilux Laboratories, Blue Stream Laboratories, and Oncotest contributed 20.9% to consolidated fourth-quarter revenue growth, both on a reported basis and in constant currency.
James C. Foster, Chairman, President and CEO, said, “Our fourth-quarter results provided a strong finish to an exceptional year in which we met our long-term revenue goals for all of our businesses except Discovery, and our long-term operating margin targets for the three business segments.
"We were very pleased that three of our businesses, Safety Assessment, Microbial Solutions, and Biologics Testing Solutions, reported low-double-digit organic revenue growth for the full year.
"Client demand for our unique portfolio of essential products and services remained strong across each of our client segments, particularly for our biotechnology clients, who were the primary driver of our revenue growth in 2016.”
"Based on our view of the opportunities in 2017, we believe we will again deliver high single-digit organic revenue growth and earnings per share growth at a faster rate than revenue,” Mr. Foster said.
Charles River completed the divestiture of its Contract Development and Manufacturing (CDMO) business on February 10, 2017, to Quotient Clinical, a portfolio company of specialist healthcare investment adviser GHO Capital Partners LLP, based in London, England, for $75m in cash, subject to certain post-closing adjustments.
The CDMO business, which represented approximately 1% of Charles River’s 2016 consolidated revenue, provides services to support the formulation design and manufacture of oral drug dosages for biopharmaceutical clients, specialising in high-potency compounds.
Charles River acquired the CDMO business in April 2016 as part of the acquisition of WIL Research.
Following a strategic review, Charles River determined that the CDMO business was not optimised within its portfolio at its current scale, and that the capital could be better deployed in other long-term growth opportunities.