CHARLES RIVER LABORATORIES INTERNATIONAL, INC.CRL
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. Goodwill & Intangibles Disclosure
GOODWILL AND INTANGIBLE ASSETS
Goodwill
The following table provides a rollforward of the changes in the carrying amount of the Company’s goodwill:
| RMS | DSA(1) | Manufacturing (2) | Total | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
| December 30, 2023 | $ | 497,474 | $ | 1,662,434 | $ | 935,137 | $ | 3,095,045 | |||||||||||||||
| Acquisitions | — | 17,675 | — | 17,675 | |||||||||||||||||||
| Impairment | — | — | (215,000) | (215,000) | |||||||||||||||||||
| Foreign exchange | (734) | (44,458) | (5,920) | (51,112) | |||||||||||||||||||
| December 28, 2024 | 496,740 | 1,635,651 | 714,217 | 2,846,608 | |||||||||||||||||||
| Divestitures | — | (4,000) | — | (4,000) | |||||||||||||||||||
| Impairment | — | — | (165,000) | (165,000) | |||||||||||||||||||
| Foreign exchange | 14,104 | 46,867 | 25,674 | 86,645 | |||||||||||||||||||
| December 27, 2025 | $ | 510,844 | $ | 1,678,518 | $ | 574,891 | $ | 2,764,253 | |||||||||||||||
(1) DSA includes accumulated impairment losses of $1 billion, which were recognized in fiscal years 2008 and 2010. | |||||||||||||||||||||||
(2) Manufacturing includes accumulated impairment losses of $380 million, which were recognized in fiscal years 2024 and 2025. | |||||||||||||||||||||||
As of the beginning of fiscal 2025, the Company has combined the Discovery Services and Safety Assessment reporting units into a single reporting unit consistent with recent changes to the DSA integrated operating structure.
The decrease in goodwill during fiscal year 2025 is primarily related to the $165.0 million impairment charge recognized in the Manufacturing reportable segment partially offset by the effect of foreign exchange. The decrease in goodwill during fiscal year 2024 is primarily related to the $215.0 million impairment charge recognized in the Manufacturing reportable segment and foreign exchange impacts; partially offset by measurement period adjustments related to the acquisition of Noveprim in the DSA reportable segment.
Annual Goodwill Impairment Assessment
Goodwill is tested for impairment annually during the fourth quarter or more frequently if an event occurs or circumstances change that would more-likely-than-not reduce the fair value of the Company's reporting units below their carrying amounts.
During the fourth quarter ended December 27, 2025, the Company performed the quantitative goodwill impairment test for our reporting units and upon completion, it was determined that the fair value of the Biologics Solutions reporting unit did not exceed its carrying value, resulting in a goodwill impairment charge of $165.0 million within the accompanying consolidated statements of income (loss). This was primarily attributable to a decline in its operating performance, resulting in a reduction to the long-range financial plan of the reporting unit, and evolving market information in the fourth quarter of 2025. The fair value of the Biologics Solutions reporting unit tested for impairment during 2025 was determined using a weighted combination of a discounted cash flow model (an income approach), and sales and earnings multiples based on the guideline public company method, and other market information (a market approach). The discounted cash flow model used to determine the fair value of the Biologics Solutions reporting unit reflected significant assumptions related to future revenue, a long term growth rate, operating income margins, and a discount rate based on a weighted-average cost of capital. Significant assumptions used in the market approach included earnings multiples, sales multiples, and other market information about the value of certain asset groups within the reporting unit. The Biologics Solutions reporting unit fair value measurement is classified as Level 3 in the fair value hierarchy because they involve significant unobservable inputs. The Company will continue to closely monitor future performance and any potential impacts on the value of the reporting unit. If the estimated future cash flows decrease below our current expectations, specifically as a result of lower revenue growth rates or operating income margins, or due to an increase of the weighted-average cost of capital, the fair value may further decrease resulting in an incremental material goodwill impairment.
Excluding the impairment charge associated with the Biologics Solutions reporting unit, the fiscal year 2025 annual impairment test indicated that goodwill was not impaired for any other reporting units.
2024 Goodwill Impairment Results from Triggering Events
In fiscal 2024, subsequent to the annual goodwill impairment test, a triggering event was identified for the Biologics Solutions reporting unit (part of the Manufacturing reporting segment) which has goodwill assigned to it. This resulted from a loss of key customers, ultimately resulting in a reduction in Biologics Solutions’ long range financial outlook. In response, management conducted a quantitative impairment test for goodwill to determine if the goodwill in the Biologics Solutions reporting unit was impaired. The fair value of the Biologics Solutions reporting unit was determined by using a weighted combination of a market-based approach and an income approach. Under the market-based approach, the Company utilized entity specific information about the reporting unit as well as publicly available industry information to determine key assumptions including earnings multiples and sales multiples. Under the income approach, fair value was determined based on the estimated future cash flows of the reporting unit which includes key assumptions for future revenue, long term growth rates, and operating income margins, discounted by an estimated weighted-average cost of capital. The Biologics Solutions reporting unit fair value measurement is classified as Level 3 in the fair value hierarchy because they involve significant unobservable inputs.
Upon completion of the quantitative impairment test, it was determined that the fair value of the reporting unit did not exceed its carrying value. As a result, the Company recognized a goodwill impairment charge of $215.0 million within the accompanying consolidated statements of income (loss). Excluding the impairment charge associated with the Biologics Solutions reporting unit, the fiscal year 2024 annual impairment test indicated that goodwill was not impaired for any other reporting units.
Intangible Assets, Net
The following table displays intangible assets, net by major class:
| December 27, 2025 | December 28, 2024 | ||||||||||||||||||||||||||||||||||
| Gross | Accumulated Amortization | Net | Gross | Accumulated Amortization | Net | ||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||
| Client relationships | $ | 1,325,779 | $ | (1,016,198) | $ | 309,581 | $ | 1,505,871 | $ | (823,903) | $ | 681,968 | |||||||||||||||||||||||
| Technology | 142,084 | (124,172) | 17,912 | 139,335 | (116,536) | 22,799 | |||||||||||||||||||||||||||||
| Trademarks and trade names | 8,882 | (6,869) | 2,013 | 11,827 | (5,630) | 6,197 | |||||||||||||||||||||||||||||
| Other | 21,052 | (10,563) | 10,489 | 39,819 | (27,383) | 12,436 | |||||||||||||||||||||||||||||
| Intangible assets | $ | 1,497,797 | $ | (1,157,802) | $ | 339,995 | $ | 1,696,852 | $ | (973,452) | $ | 723,400 | |||||||||||||||||||||||
The decrease in intangible assets, net during fiscal year 2025 related primarily to normal amortization over the useful lives, a $211.0 million impairment charge (noted below), and accelerated amortization of certain client relationships (noted below). Amortization expense of definite-lived intangible assets for fiscal years 2025, 2024 and 2023 was $179.1 million, $138.5 million and $137.4 million, respectively.
During the fourth quarter ended December 27, 2025, prior to the annual Goodwill Impairment Assessment, a triggering event was identified impacting the Cell Solutions, CDMO Cell Therapy, and CDMO Gene Therapy asset groups due to a decline in operating performance in fiscal year 2025, resulting in a reduction in the asset groups’ long range financial outlook, and evolving market information about these asset groups identified in the fourth quarter of fiscal year 2025. Cell Solutions is presented within the RMS reportable segment, while CDMO Cell Therapy and CDMO Gene Therapy are presented within the Manufacturing reportable segment. In response, the Company conducted a recoverability test for each asset group, based on an estimate of undiscounted future cash flows for various recoverability scenarios, to determine if the asset groups were impaired. Upon completion of the recoverability test, it was determined that the probability-weighted undiscounted cash flows of the CDMO Cell Therapy asset group exceeded its carrying value. The Cell Solutions and CDMO Gene Therapy asset groups probability-weighted undiscounted cash flows did not exceed their carrying value, resulting in the Company recording an intangible asset impairment charge related to client relationships and trade names of approximately $211.0 million within the accompanying consolidated statements of income (loss). Additionally, the Company recorded impairment charges of approximately $8.0 million to Property, plant, and equipment, net and Operating lease right-of-use assets, net, recognized in the Company’s consolidated statements of income (loss) as a component of selling, general and administrative expenses. The fair value of the Cell Solutions and CDMO Gene Therapy asset groups were determined using a market approach by using other market information about the value of these asset groups.
During the fourth quarter ended December 28, 2024, a triggering event was identified for the CDMO Cell Therapy asset group within the Biologics Solutions business, part of the Manufacturing reportable segment, as there was a loss of key customers, resulting in a significant reduction in cash flows. The Company concluded that there were no impairments to the long-lived asset group, which includes client relationships. However, the remaining useful life of the client relationships was reduced. As a result of the decrease in the remaining useful life, $9.4 million of accelerated amortization was recognized within the
accompanying consolidated statements of income (loss). The remaining value of these client relationships was $75.9 million and was amortized over the remaining useful life of approximately 6 months in fiscal year 2025.
As of December 27, 2025, estimated amortization expense for intangible assets for each of the next five fiscal years is expected to be as follows:
| Fiscal Year | Amortization Expense | |||||||
| (in thousands) | ||||||||
| 2026 | $ | 70,048 | ||||||
| 2027 | $ | 61,308 | ||||||
| 2028 | $ | 53,705 | ||||||
| 2029 | $ | 49,085 | ||||||
| 2030 | $ | 33,869 | ||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 18, 2026 | Showing above |
| 2024 | Feb 19, 2025 | |
| 2023 | Feb 14, 2024 | |
| 2022 | Feb 22, 2023 | |
| 2021 | Feb 16, 2022 | |
| 2020 | Feb 17, 2021 | |
| 2019 | Feb 11, 2020 | |
| 2018 | Feb 13, 2019 | |
| 2017 | Feb 13, 2018 | |
| 2016 | Feb 14, 2017 | |
| 2015 | Feb 12, 2016 | |
About Goodwill & Intangibles Disclosures
Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.
Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.