Charles River provides 2H17 outlook
Expect SA, Microbial Solutions, and Biologics to be the primary drivers of growth in 2H17, partially offset by softness in the RMS segment. Expect 2H17 RMS organic revenue growth to be essentially flat, primarily due to RADS project that ended in 2016 (compresses the annual RMS growth by ~1%); Slightly lower revenue in the research models business in North America and Europe; Slower growth in China due to capacity constraints. FY17 RMS organic revenue growth expected to be in the low-single digits; Lower revenue growth will put pressure on the RMS operating margin in 2H17; FY17 RMS operating margin will remain in the high-20% range, but will be moderately lower than in 2016. Expect FY17 organic revenue growth will be: DSA segment: Near 10%; Manufacturing segment: 10% or higher; On a consolidated basis, non-GAAP operating margin in FY17 will approach our long-term goal of 20%; Manufacturing segment will be the largest contributor to operating margin improvement in FY17; Lower corporate spending as a % of revenue YOY. Guidance from presentation slides.