May 9 (Reuters) - Charles River Laboratories ( CRL )

beat Wall Street estimates for first-quarter profit and revenue

on Thursday, helped by strength in its manufacturing business

and its unit that supplies research models to biotech clients.

The contract research firm reaffirmed its full-year 2024

forecast, as it expects demand for its services to improve

modestly during the second half of the year.

WHY IT'S IMPORTANT

Charles River and its peers have been grappling with

weakening demand for their services due to a funding crunch

among their biotech clients.

Peer Danaher expects the impact of reduced demand to

continue into the second quarter of 2024.

CONTEXT

Rising interest rates have squeezed funding for drug

development programs and made biopharma firms more cautious

about spending throughout last year.

Some analysts have said funding for biotechs could stabilize

this year after a strong 2023 for regulatory approvals in the

U.S.

KEY QUOTE

Charles River CEO James Foster said it would take time for

stronger biotech funding to translate into new bookings in its

drug discovery unit and boost revenue.

"However, these trends are consistent with our expectations

that demand will improve later this year," Foster said.

BY THE NUMBERS

The company posted quarterly revenue of $1.01 billion,

beating analysts' average estimate of $992.27 million, according

to LSEG data.

Revenue from its research model and services unit, which

supplies lab monkeys, was $220.9 million, while the

manufacturing segment posted $185.2 million.

Revenue from its discovery and safety assessment segment

fell 8.6% to $605.5 million, missing estimates of $620.99

million.

Charles River earned adjusted profit of $2.27 per share,

ahead of the $2.07 estimated.

The company had said in February it sees annual adjusted

profit per share to be between $10.90 and $11.40 and revenue

growth to be between 1% and 4%.