WILMINGTON, Mass. (AP) — Medical research equipment and services company Charles River Laboratories International Inc. said Tuesday that its profit jumped 80 percent in the first quarter after it booked a big tax gain on the sale of its early-stage clinical business and cut costs.
The company said its profit rose to $31.3 million, or 57 cents per share, from $17.4 million, or 26 cents per share, a year earlier. Charles River Labs divested its early-stage clinical business on March 28, and recorded an $11.1 million tax benefit on the move. It also reported lower cost of goods sold and general and administrative costs.
Excluding one-time items, Charles River Labs earned 61 cents per share from continuing operations.
Revenue declined 2 percent to $285.8 million from $292.3 million. Revenue from its research models and services business rose 1 percent to $173.4 million, but preclinical services revenue fell 6 percent to $112.5 million because of weak demand from large pharmaceutical clients, and an increase in short-term studies.
Chairman, President and CEO James Foster said preclinical results have been steady in the last three quarters, but it's not clear when results will improve.
"The greater proportion of shorter-term studies in the sales mix is limiting visibility into a recovery in preclinical demand," he said.
The results topped analysts' average estimates for profit of 54 cents per share and revenue of $279.3 million, according to FactSet. The estimate excludes one-time costs and gains.
The company backed its outlook for the full year, forecasting an adjusted profit of $2.20 to $2.40 per share. Revenue is expected to be about flat with the $1.13 billion reported in 2010.
Analysts expect a profit of $2.32 per share and revenue of $1.14 billion, on average.
Charles River Labs shares fell 95 cents, or 2.2 percent, to close at $41.52 Tuesday.