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UNITED STATES
SECURITES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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FORM 10-Q

ý	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED MARCH 30, 2002

OR

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 333-92383

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CHARLES RIVER LABORATORIES
INTERNATIONAL, INC.
(Exact Name of Registrant as specified in its Charter)

251 BALLARDVALE STREET, WILMINGTON, MASSACHUSETTS 01887
(Address of Principal Executive Offices) (Zip Code)

978-658-6000
(Registrant's Telephone Number, Including Area Code)

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        Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

        As of March 30, 2002 there were 44,471,493 shares of the registrant's common stock outstanding.

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CHARLES RIVER LABORATORIES INTERNATIONAL, INC.
FORM 10-Q
For the Quarterly Period Ended March 30, 2002
Table of Contents

					Page
Part I.    Financial Information
	Item 1.		Financial Statements		3
			Condensed Consolidated Statements of Income (Unaudited) for the three months ended March 30, 2002 and March 31, 2001		3
			Condensed Consolidated Balance Sheets as of March 30, 2002 (Unaudited) and December 29, 2001		4
			Condensed Consolidated Statements of Cash Flows (Unaudited) for the three months ended March 30, 2002 and March 31, 2001		5
			Notes to Unaudited Condensed Consolidated Interim Financial Statements		6
	Item 2.		Management's Discussion and Analysis of Financial Condition and Results of Operations		15
	Item 3.		Quantitative and Qualitative Disclosures about Market Risk		18
Part II.    Other Information
	Item 6.		Exhibits and Reports on Form 8-K		19

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CHARLES RIVER LABORATORIES INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

For the three months ended March 30, 2002 and March 31, 2001
(dollars in thousands except for per share data)

			Three Months Ended
			March 30, 2002			March 31, 2001
Net sales related to products			$	70,558		$	62,078
Net sales related to services				63,262			36,953
Total net sales			$	133,820		$	99,031
Costs and expenses
	Cost of products sold			38,945			36,418
	Cost of services provided			44,916			25,951
	Selling, general and administrative			20,919			15,460
	Amortization of goodwill and intangibles			630			1,828
Operating income				28,410			19,374
Other income (expense)
	Interest income			513			253
	Interest expense			(3,905	)		(6,958	)
	Other income (expense)			(83	)		555
Income before income taxes, minority interests, earnings from equity investments and extraordinary item				24,935			13,224
Provision for income taxes				9,725			5,555
Income before minority interests, earnings from equity investments and extraordinary item				15,210			7,669
Minority interests				(762	)		(564	)
Earnings from equity investments				82			83
Income before extraordinary item				14,530			7,188
Extraordinary loss, net of tax benefit of $10,717 and $128, respectively				(16,762	)		(237	)
Net income (loss)			$	(2,232	)	$	6,951
Earnings per common share before extraordinary item
	Basic		$	0.33		$	0.20
	Diluted		$	0.31		$	0.18
Earnings per common share after extraordinary item
	Basic		$	(0.05	)	$	0.19
	Diluted		$	(0.03	)	$	0.17

See Notes to Condensed Consolidated Financial Statements

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CHARLES RIVER LABORATORIES INTERNATIONAL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(dollars in thousands)

				March 30, 2002			December 29, 2001
				(Unaudited)
Assets
Current assets
	Cash and cash equivalents			$	135,398		$	58,271
	Trade receivables, less allowances of $2,382 and $2,119, respectively				105,127			98,478
	Inventories				39,125			39,056
	Deferred tax asset				8,701			8,701
	Other current assets				5,786			5,648
		Total current assets			294,137			210,154
	Property, plant and equipment, net				153,901			155,919
	Goodwill, net				70,430			52,087
	Other intangibles, net				20,244			38,287
	Investments in affiliates				3,123			3,002
	Deferred tax asset				95,421			87,781
	Deferred financing costs				8,409			5,459
	Other assets				18,527			18,673
		Total assets		$	664,192		$	571,362
Liabilities and Shareholders' Equity
Current liabilities
	Current portion of long-term debt			$	2,967		$	759
	Current portion of capital lease obligation				165			174
	Accounts payable				11,777			13,868
	Accrued compensation				19,342			25,736
	Deferred income				23,160			22,210
	Accrued liabilities				27,347			28,899
	Accrued interest				1,261			2,838
	Accrued income taxes				3,676			4,048
		Total current liabilities			89,695			98,532
Long-term debt					259,207			155,506
Capital lease obligations					317			361
Accrued ESLIRP					11,654			11,383
Other long-term liabilities					2,972			3,082
		Total liabilities			363,845			268,864
Commitments and contingencies (Note 9)
Minority interests					11,941			12,988
Shareholders' equity
	Common stock (Note 7)				445			442
	Capital in excess of par value				590,606			588,909
	Retained earnings				(285,400	)		(283,168	)
	Loans to officers				(245	)		(341	)
	Unearned compensation				(285	)		(316	)
	Accumulated other comprehensive income				(16,715	)		(16,016	)
		Total shareholders' equity			288,406			289,510
		Total liabilities and shareholders' equity		$	664,192		$	571,362

See Notes to Condensed Consolidated Financial Statements

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CHARLES RIVER LABORATORIES INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(dollars in thousands)

				Three Months Ended
				March 30, 2002			March 31, 2001
Cash flows relating to operating activities
	Net income (loss)			$	(2,232	)	$	6,951
Adjustments to reconcile net income to net cash provided by operating activities:
	Depreciation and amortization				5,434			5,439
	Amortization of debt issuance costs and discounts				374			453
	Provision for doubtful accounts				277			199
	Extraordinary loss, net of tax				16,762			237
	Earnings from equity investments				(82	)		(83	)
	Minority interests				762			564
	Deferred income taxes				3,679			4,303
	Windfall tax benefit from exercises of employee stock options				200			—
	Loss on disposal of property, plant, and equipment				587			195
	Other non-cash items				31			—
Changes in assets and liabilities:
	Trade receivables				(7,476	)		(5,559	)
	Inventories				(317	)		(555	)
	Other current assets				(154	)		(2,663	)
	Other assets				142			(426	)
	Accounts payable				(1,936	)		(2,581	)
	Accrued compensation				(6,220	)		(2,035	)
	Deferred income				951			(208	)
	Accrued liabilities				(1,756	)		(941	)
	Accrued interest				(1,577	)		3,604
	Accrued income taxes				(248	)		(731	)
	Accrued ESLIRP				271			275
	Other long-term liabilities				(58	)		(229	)
		Net cash provided by operating activities		$	7,414		$	6,209
Cash flows relating to investing activities
	Capital expenditures				(4,535	)		(4,253	)
	Contingent payments for prior year acquisitions				—			(250	)
	Acquisition of businesses, net of cash acquired				(1,000	)		(51,265	)
		Net cash used in investing activities		$	(5,535	)	$	(55,768	)
Cash flows relating to financing activities
	Proceeds from long term debt and revolving credit facility				187,273			41,450
	Payments on long-term debt and revolving credit facility				(82,186	)		(12,099	)
	Payments of deferred financing cost				(6,021	)		(891	)
	Payments on capital lease obligations				(53	)		(701	)
	Proceeds from issuance of common stock, net of transaction fees				—			62,222
	Proceeds from exercises of employee stock options				153			—
	Proceeds from exercises of warrants				1,347			—
	Premium paid on early retirement of debt				(23,886	)		—
	Dividends paid to minority interests				(1,470	)		(729	)
	Payments received from officer loans				96			300
		Net cash provided by financing activities		$	75,253		$	89,552
	Effect of exchange rate changes on cash and cash equivalent				(5	)		(723	)
	Net change in cash and cash equivalents				77,127			39,270
		Cash and cash equivalents, beginning of period			58,271			33,129
Cash and cash equivalents, end of period				$	135,398		$	72,399
Supplemental cash flow information
	Cash paid for interest			$	5,061		$	6,747
	Cash paid for taxes				5,944			2,339

See Notes to Condensed Consolidated Financial Statements

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CHARLES RIVER LABORATORIES INTERNATIONAL, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

(dollars in thousands)

1. Basis of Presentation

        The condensed consolidated interim financial statements are unaudited, and certain information and footnote disclosures related thereto normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America have been omitted in accordance with Rule 10-01 of Regulation S-X. In the opinion of management, the accompanying unaudited condensed consolidated financial statements were prepared following the same policies and procedures used in the preparation of the audited financial statements and reflect all adjustments (consisting of normal recurring adjustments) considered necessary to present fairly the financial position and results of operations of Charles River Laboratories International, Inc. ("the Company"). The results of operations for the interim periods are not necessarily indicative of the results for the entire fiscal year. These condensed consolidated financial statements should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended December 29, 2001.

        Certain amounts in prior year financial statements and related notes have been reclassified to conform with current year presentation.

2. Senior Convertible Debentures

        On January 24, 2002, the Company issued $175,000 par value of senior convertible debentures through a private placement offering. On February 11, 2002, the company issued an additional $10,000 par value of senior convertible debentures through the additional purchase option. The Company received approximately $179,450, net of underwriter discounts. The senior convertible debentures will accrue interest at an initial annual rate of 3.5%, payable semi-annually in arrears, beginning August 1, 2002. The senior convertible debentures will mature in 2022 and are convertible into shares of the Company's common stock at a conversion price of $38.87, subject to adjustment under certain circumstances. On or after February 5, 2005, the Company may redeem for cash all or part of the debentures that have not been previously converted at the redemption prices set forth in the purchase agreement. Holders may require the Company to repurchase for cash all or part of their debentures on February 1, 2008, February 1, 2013 or February 1, 2017 at a price equal to 100% of the par value of the debentures plus accrued interest up to but not including the date of repurchase. In addition, upon a change in control of the Company occurring on or prior to February 1, 2022, each holder may require the Company to repurchase all or a portion of such holder's debentures for cash. The Company used a portion of the net proceeds from the senior convertible debenture offering to retire all of the 13.5% senior subordinated notes through a tender offer.

3. Tender Offer

        On February 14, 2002, the Company completed a tender offer for $79,728 par value for all of the 13.5% senior subordinated notes. The Company recorded an extraordinary loss before tax of $27,479, due to the payment of premiums related to the early extinguishment of debt ($23,886), the write-off of deferred financing costs ($2,726) and issuance discounts ($867). The extraordinary loss was recorded in the condensed consolidated statement of income net of tax benefit of $10,717.

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4. Business Acquisitions

        There have been no significant acquisitions during the three months ended March 30, 2002.

        On January 8, 2001, Charles River Laboratories, Inc. ("CRL"), the Company's wholly owned subsidiary, purchased 100% of the common stock of Pathology Associates International Corporation ("PAI"). Consideration, including acquisition expenses, of $35,238 was paid with respect to this acquisition, consisting of $25,557 of cash and a $12,000 callable convertible note. This acquisition was recorded as a purchase business combination and CRL is consolidating the operations of PAI from the date of acquisition.

        Effective February 27, 2001, CRL acquired Primedica Corporation ("Primedica") for consideration, including acquisition expenses, of $51,107. Consideration was comprised of $25,708 of cash, $16,375 of the Company's common stock and $9,024 in assumed debt. This acquisition was recorded as a purchase business combination and CRL is consolidating the operations of Primedica from the date of acquisition.

        On July 20, 2001, CRL purchased 100% of the common stock of Genetic Models, Inc. ("GMI") for cash consideration of $4,000. This acquisition was recorded as a purchase business combination in accordance with Statement of Financial Accounting Standards No. 141, "Business Combinations". The Company is consolidating the operations of GMI from the date of acquisition.

        The following selected unaudited pro forma consolidated results of operations are presented as if each of the acquisitions had occurred as of the beginning of the period immediately preceding the period of acquisition after giving effect to certain adjustments for the amortization of goodwill for the three months ended March 31, 2001, additional interest expense and related income tax effects. The pro forma data is for informational purposes only and does not necessarily reflect the results of operations had the companies operated as one during the period. No effect has been given for synergies, if any, that may have been realized through the acquisitions.

        Refer to Note 6 for further discussion of the method of computation of earnings per share.

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5. Restructuring Charges

        During the fourth quarter of 2001, the Company recorded a restructuring charge associated with the closing of a San Diego, California facility. Approximately 40 employees were terminated as a result of this action. As of March 30, 2002 and December 29, 2001, $571 and $720, respectively, of this charge is included in the consolidated balance sheet as an accrued liability. The Company expects the reserve to be fully utilized by the end of 2002. A summary of the activities associated with the San Diego restructuring charge is as follows:

        During the fourth quarter of 2000, the Company recorded a restructuring charge associated with the closing of a facility in France. During 2001, the Company recorded additional charges relating to the settlement of labor disputes which originated during the first quarter of 2001. Approximately 60 employees were terminated as a result of the restructuring. As of March 30, 2002 and December 29, 2001, $508 and $969, respectively, of this charge is included in the consolidated balance sheet as an accrued liability. The Company expects the reserve to be fully utilized by the end of 2002. A summary of the activities associated with the France restructuring charge is as follows:

6. Earnings per Share

        Basic earnings per share for the three month period ended March 30, 2002 and March 31, 2001 were computed by dividing earnings available to common shareholders for these periods by the weighted average number of common shares outstanding in the respective periods.

        The weighted average number of common shares outstanding in the three month period ended March 30, 2002 and March 31, 2001 have been adjusted to include common stock equivalents for the purpose of calculating diluted earnings per share before and after the extraordinary item for these periods.

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        The following table illustrates the reconciliation of the numerator and denominator of the basic and diluted earnings per share before and after the extraordinary item computations:

			Three Month Period Ended
			March 30, 2002		March 31, 2001
Numerator:
Income before extraordinary item			$14,530		$7,188
Extraordinary loss, net of tax benefit			(16,762	)	(237	)
Income after extraordinary item for purposes of calculating basic earnings per share			(2,232	)	6,951
After tax equivalent of interest expense:
	3.5% senior convertible debentures		706		—
	2% convertible note		8		—
Income for purposes of calculating diluted earnings per share			$(1,518	)	$6,951
Denominator:
Weighted average shares outstanding—Basic			44,254,895		36,582,532
Effect of dilutive securities:
	3.5% senior convertible debentures		3,401,024		—
	Stock options		990,494		985,782
	Warrants		855,707		2,718,731
	2% convertible note		35,251		—
Weighted average shares outstanding—Diluted			49,537,371		40,287,045
Basic earnings per share before extraordinary item			$0.33		$0.20
Basic loss per share on extraordinary item			(0.38	)	(0.01	)
Basic earnings (loss) per share after extraordinary item			$(0.05	)	$0.19
Diluted earnings per share before extraordinary item			$0.31		$0.18
Diluted loss per share on extraordinary item			(0.34	)	(0.01	)
Diluted earnings (loss) per share after extraordinary item			$(0.03	)	$0.17

7. Supplemental Balance Sheet Information

        The composition of inventories is as follows:

        Inventories are stated at the lower of cost or market. Cost is determined principally on the average cost method.

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7. Supplemental Balance Sheet Information (Continued)

        The composition of property, plant and equipment is as follows:

        The composition of capital stock is as follows:

March 30, 2002

        The Company has 20,000,000 shares of $0.01 par value preferred stock authorized. At March 30, 2002, no shares were issued and outstanding.

December 29, 2001

        The Company has 20,000,000 shares of $0.01 par value preferred stock authorized. At December 29, 2001, no shares were issued and outstanding.

8. Comprehensive Income (Loss)

        The components of comprehensive income (loss) for the three month periods ended March 30, 2002 and March 31, 2001 are set forth below:

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9. Commitments and Contingencies

        Various lawsuits, claims and proceedings of a nature considered normal to its business are pending against the Company. In the opinion of management, the outcome of such proceedings and litigation currently pending will not materially affect the Company's consolidated financial statements.

        On April 27, 2001, the Company's French subsidiaries obtained a favorable legal judgement in a contract dispute, with a damages award of 26,500 French Francs, approximately $3,500. The Company has received a $2,240 partial payment related to the legal judgement in fiscal 2001. As the defendant has appealed the decision, the proceeds are included as deferred income in the consolidated balance sheet as of March 30, 2002 and December 29, 2001.

        The Company has provided letters of credit in favor of the insurance carriers in the amount of $3,063.

10. Business Segment Information

        The following table presents sales and other financial information by product line segment for the three month period ended March 30, 2002 and March 31, 2001. Sales to unaffiliated customers represent net sales originating in entities primarily engaged in either research models or biomedical products and services.

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        A reconciliation of segment operating income to consolidated operating income is as follows:

11. Goodwill and Other Intangible Assets

        Effective fiscal 2002, the Company adopted Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets" (FAS 142), which establishes financial accounting and reporting standards for acquired goodwill and other intangible assets. Under FAS 142, goodwill and indefinite lived intangible assets are no longer amortized but are reviewed at least annually for impairment. Separate intangible assets that have finite useful lives will continue to be amortized over their useful lives.

        FAS 142 requires that goodwill be tested annually for impairment using a two-step process. The first step is to identify a potential impairment and, in transition, this step must be measured as of the beginning of the year of adoption. However, a company has six months from the date of adoption to complete the first step. The Company expects to complete that first step of the goodwill impairment test during the second quarter of 2002. The second step of the goodwill impairment test measures the amount of the impairment loss (measured as of the beginning of the year of adoption), if any, and must be completed by the end of fiscal year 2002. The Company has not yet determined what effect these impairment tests will have on the Company's earnings and financial position. Intangible assets deemed to have an indefinite life will be tested for impairment using a one-step process which compares the fair value to the carrying amount of the asset as of the beginning of the fiscal year, and pursuant to the requirements of FAS 142 was completed during the first quarter of 2002. The Company has determined that its identifiable intangible assets with finite useful lives were not impaired.

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        The following table displays goodwill and other intangible assets not subject to amortization and other intangible assets that continues to be subject to amortization:

				March 31, 2002						December 29, 2001
				Gross Carrying Amount			Accumulated Amortization			Gross Carrying Amount			Accumulated Amortization
Goodwill				$	82,727		$	(12,297	)	$	60,866		$	(8,779	)
Other intangible assets not subject to amortization				$	3,438		$	—		$	3,438		$	—
Other intangible assets subject to amortization:
	Assembled workforce				—			—			20,925			(3,542	)
	Customer relationships				11,491			(1,915	)		11,491			(1,724	)
	Customer contracts				3,455			(1,348	)		3,455			(1,111	)
	Trademarks and trade names				3,000			(329	)		3,000			(253	)
	Standard operating procedures				1,208			(205	)		1,208			(156	)
	Other identifiable intangible assets				3,192			(1,743	)		3,237			(1,681	)
Total other intangible assets				$	25,784		$	(5,540	)	$	46,754		$	(8,467	)
		Total goodwill and other intangible assets		$	108,511		$	(17,837	)	$	107,620		$	(17,246	)

        The changes in the gross carrying amount and accumulated amortization of goodwill from December 29, 2001 to March 30, 2002 are as follows:

			Gross Carrying Amount			Accumulated Amortization
Balance at December 29, 2001			$	60,866		$	(8,779	)
Adjustments to goodwill:
	Assembled workforce reclassification			20,925			(3,542	)
	Acquisitions			1,000			—
	Foreign currency translation			(64	)		24
Balance at March 30, 2002			$	82,727		$	(12,297	)

        Amortization expense for goodwill and other intangible assets was $630 and $1,828 for the three months ended March 30, 2002 and March 31, 2001, respectively. Estimated amortization expense for each of the next five fiscal years is $2,500.

        The following selected pro forma consolidated results are presented as if Statement of Financial Accounting Standards No. 141, "Business Combinations" and FAS 142 had been adopted at the

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beginning of fiscal 2001 and accordingly amortization for goodwill and other identifiable intangible assets has been eliminated.

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Item 2.    Management's Discussion and Analysis of Financial Condition and Results of Operations

Fiscal 2002 Compared to Fiscal 2001

        Net Sales.    Net sales for the three months ended March 30, 2002 were $133.8 million, an increase of $34.8 million, or 35.2%, from $99.0 million for the three months ended March 31, 2001. On a pro forma basis, sales increased 19.3% for the three months ended March 30, 2002 or 21.6%, excluding the negative impact from currency translation. Pro forma sales includes net sales of the companies we acquired in 2001 as if they occurred at the beginning of fiscal 2001.

        Research Models.    Net sales of research models for the three months ended March 30, 2002 were $56.9 million, an increase of $7.4 million, or 14.9%, from $49.5 million for the three months ended March 31, 2001. Small animal research model sales increased in North America by 19.8% due to an increase in unit volume, a shift to higher priced specialty units and improved pricing. Excluding negative impact from currency translation of $0.7 million, small animal research model sales in Europe increased 10.3%, driven in part by increased equipment sales as well as a shift to higher priced specialty units and an increase in unit volume. Small animal research model sales in Japan increased 20.0% for the three months ended March 30, 2002, excluding the negative impact from currency translation of $1.5 million due to continued competitor product quality issues. Our large animal breeding and import conditioning business sales increased by $1.8 million due mainly to the timing of animal shipments for the three months ended March 30, 2002.

        Biomedical Products and Services.    Net sales of biomedical products and services for the three months ended March 30, 2002 were $76.9 million, an increase of $27.4 million, or 55.4%, compared to $49.5 million for the three months ended March 31, 2001. Pro forma sales of biomedical products and services increased 24.6% for the three months ended March 30, 2002 compared to the three months ended March 31, 2001. We acquired two businesses during the first quarter of 2001, Pathology Associates International Corporation ("PAI") on January 8 and Primedica Corporation ("Primedica") on February 27, which contributed $32.9 million of sales for the three months ended March 30, 2002. On a pro forma basis, PAI and Primedica net sales increased 16.5% over the three months ended March 31, 2001.

        Cost of Products Sold and Services Provided.    Cost of products sold and services provided for the three months ended March 30, 2002 was $83.9 million, an increase of $21.6 million, or 34.7%, from $62.3 million for the three months ended March 31, 2001. Cost of products sold and services provided for the three months ended March 30, 2002 were 62.7% of the net sales compared to 62.9% for the three months ended March 31, 2001.

        Research Models.    Cost of products sold and services provided for research models for the three months ended March 30, 2002 was $30.8 million, an increase of $1.9 million, or 6.6%, compared to $28.9 million for the three months ended March 31, 2001. Cost of products sold and services provided for the three months ended March 30, 2002 improved to 54.1% of net sales compared to 58.4% of net sales for the three months ended March 31, 2001. Cost of products sold and services provided increased at a lower rate than net sales due to reduced production costs resulting from the closure of our French facility and increased sales which resulted in improved capacity utilization and improved efficiencies.

        Biomedical Products and Services.    Cost of products sold and services provided for biomedical products and services for the three months ended March 30, 2002 was $53.0 million, an increase of $19.6 million, or 58.7%, compared to $33.4 million for the three months ended March 31, 2001. Cost of products sold and services provided as a percentage of net sales increased to 68.9% for the three months ended March 30, 2002 from 67.5% for the three months ended March 31, 2001. Cost of products sold and services provided increased as a percentage of net sales for the three months ended

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March 30, 2002 primarily due to the addition of Primedica which operated at lower gross margins than the remainder of our biomedical products and services businesses.

        Selling, General and Administrative Expenses.    Selling, general and administrative expenses for the three months ended March 30, 2002 were $20.9 million, an increase of $5.4 million, or 34.8%, from $15.5 million for the three months ended March 31, 2001. Selling, general and administrative expenses for the three months ended March 30, 2002 were 15.6% of net sales compared to 15.7% of net sales for the three months ended March 31, 2001.

        Research Models.    Selling, general and administrative expenses for research models for the three months ended March 30, 2002 were $6.5 million, a decrease of $0.6 million compared to $7.1 million for the three months ended March 31, 2001. In 2001, we recorded a charge of $0.8 million associated with the closing of a French facility. Selling, general and administrative expenses for the three months ended March 30, 2002 were 11.4% of net sales, compared to 14.3% for the three months ended March 31, 2001, principally due to economies of scale.

        Biomedical Products and Services.    Selling, general and administrative expenses for biomedical products and services for the three months ended March 30, 2002 were $9.2 million, an increase of $3.2 million, or 53.3%, compared to $6.0 million for the three months ended March 31, 2001. Selling, general and administrative expenses for the three months ended March 30, 2002 were 12.0% of net sales compared to 12.1% of net sales for the three months ended March 31, 2001.

        Unallocated Corporate Overhead.    Unallocated corporate overhead, which consists of various corporate expenses, was $5.2 million for the three months ended March 30, 2002, compared to $2.4 million for the three months ended March 31, 2001. The change was caused by increased administrative expenses and decreased pension income.

        Amortization of Goodwill and Other Intangibles.    Amortization of goodwill and other intangibles for the three months ended March 30, 2002 was $0.6 million, a decrease of $1.2 million from $1.8 million for the three months ended March 31, 2001. The decrease was due to our adoption of the Financial Accounting Standards Board (FASB) Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets" (FAS 142).

        Operating Income.    Operating income for the three months ended March 30, 2002 was $28.4 million, an increase of $9.0 million, or 46.4%, from $19.4 million for the three months ended March 31, 2001. Operating income for the three months ended March 30, 2002 was 21.2% of net sales, compared to 19.6% of net sales for the three months ended March 31, 2001.

        Research Models.    Operating income from sales of research models for the three months ended March 30, 2002 was $19.5 million, an increase of $6.2 million, or 46.6%, from $13.3 million for the three months ended March 31, 2001. Operating income from sales of research models for the three months ended March 30, 2002 was 34.3% of net sales, compared to 26.9% for the three months ended March 31, 2001 due to increased sales and higher gross margins primarily from improved capacity utilization.

        Biomedical Products and Services.    Operating income from sales of biomedical products and services for the three months ended March 30, 2002 was $14.1 million, an increase of $5.6 million, or 65.9%, from $8.5 million for the three months ended March 31, 2001. Operating income from sales of biomedical products and services for the three months ended March 30, 2002 increased to 18.3% of net sales, compared to 17.2% of net sales for the three months ended March 31, 2001, due to the benefit associated with the elimination of goodwill amortization partially offset by the lower margins from the acquisition of Primedica.

16

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        Interest Expense.    Interest expense for the three months ended March 30, 2002 was $3.9 million, compared to $7.0 million for the three months ended March 31, 2001. The $3.1 million decrease is primarily due to the impact of the tender offer for all of the 13.5% senior subordinated notes completed during the first quarter of 2002 compared to the lower interest rate on our 3.5% senior convertible debenture issuance during the first quarter of 2002 along with reductions in our interest rates and principal on our variable rate debt.

        Other Income.    During the three months ended March 31, 2001, we received insurance proceeds relating to damaged production facilities, which resulted in a net gain of $0.5 million.

        Income Taxes.    The effective tax rate for the three months ended March 30, 2002 of 39.0% compares favorably to the effective tax rate of 42.0% for the three months ended March 31, 2001. In the three months ended March 30, 2002, the increased operating income, along with the impact of reduced leverage, increased our pre-tax income. The greater pre-tax income decreased the impact of the permanent differences on the tax rate and lead to better utilization of the foreign tax credits.

        Income before Extraordinary Loss.    Income before extraordinary loss for the three months ended March 30, 2002 was $14.5 million, an increase of $7.3 million from $7.2 million for the three months ended March 31, 2001. Income before extraordinary loss for the three months ended March 30, 2002 was 10.8% of net sales, compared to 7.3% of net sales for the three months ended March 31, 2001. The improvement is driven by the increase in operating income and the decrease in interest expense.

        Extraordinary Loss.    We recorded an extraordinary loss of $16.8 million for the three months ended March 30, 2002. The pre-tax loss of $27.5 million is the result of a premium associated with the debt repayments and the write-off of deferred financing costs and original issuance discounts. The related tax benefit was $10.7 million. In the three months ended March 31, 2001, we recorded an extraordinary loss of $0.2 million, net of tax benefit of $0.2 million, as a result of the early repayment of debt.

        Net Income/Loss.    The loss for the three months ended March 30, 2002 was $2.2 million, a decrease of $9.2 million compared to a net income of $7.0 million for the three months ended March 31, 2001.

Liquidity and Capital Resources

        Cash and cash equivalents of the Company totaled $135.4 million at March 30, 2002 compared with $58.3 million at December 29, 2001. Our principal sources of liquidity are cash from operations as well as cash provided by our equity and debt offerings.

        Net cash provided by operating activities for the three months ended March 30, 2002 and March 31, 2001 was $7.4 million and $6.2 million, respectively. The increase in cash provided by operations is primarily a result of our improved performance during the first three months of 2002.

        Net cash used in investing activities during the three months ended March 30, 2002 and March 31, 2001 were $5.5 million and $55.8 million, respectively. The decrease in cash used is a result of our business acquisitions in 2001.

        Net cash provided by financing activities during the three months ended March 30, 2002 and March 31, 2001 were $75.3 million and $90.3 million, respectively. During March 2002, we issued $185.0 million par value of senior convertible debentures. We used $79.7 million of the proceeds to repay all of the 13.5% senior subordinated notes. A premium of $23.9 million was paid on the early retirement of the 13.5% senior subordinated notes.

17

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        Minimum future payments of the Company's long term debt at March 30, 2002 are as follows:

        We anticipate that our operating cash flows, together with borrowings under our credit facility, will be sufficient to meet our anticipated future operating expenses, capital expenditures and debt service obligations as they become due.

Item 3.    Quantitative and Qualitative Disclosure About Market Risk

        We are subject to market risks arising from changes in interest rates and foreign currency exchange rates. Our primary interest rate exposure results from changes in LIBOR or the base rate which are used to determine the applicable interest rates under our term loans and revolving credit facility. Our potential loss over one year that would result from a hypothetical, instantaneous and unfavorable change of 100 basis points in the interest rate on all of our variable rate obligations would be approximately $0.7 million. Fluctuations in interest rates will not affect the interest payable on the senior convertible debentures, which is fixed.

        We do not use financial instruments for trading or other speculative purposes.

        We also have exposure to some foreign currency exchange rate fluctuations for the cash flows received from our foreign affiliates. This risk is mitigated by the fact that their operations are conducted in their respective local currencies. Currently, we do not engage in any foreign currency hedging activities.

Factors Affecting Future Results

        This document contains forward looking statements. You can identify these statements by forward looking words such as "may", "will", "expect", "anticipate", "believe", "estimate" and "continue" or similar words. You should read statements that contain these words carefully because they discuss our future expectations, contain projections of our future results of operations or of our financial condition or state other "forward looking" information. We believe that it is important to communicate our future expectations to our investors. However, there may be events in the future that we are not able to accurately predict or control and that may cause our actual results to differ materially from those discussed as a result of various factors, including, but not limited to, our success in selecting and integrating business and technology we acquire, contaminations at our facilities, changes in the pharmaceutical or biotechnology industries, competition and changes in government regulations or general economic or market conditions. These factors should be considered carefully and readers should not place undue reliance on our forward looking statements. We are under no duty to update the forward looking statements after the date of this document or to conform these statements to actual results.

18

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CHARLES RIVER LABORATORIES INTERNATIONAL, INC.
FORM 10-Q
For the Quarterly Period Ended March 30, 2002

Item 6. EXHIBITS AND REPORTS ON FORM 8-K

(a)

The following exhibits are included as part of this Report on Form 10-Q:

Exhibit Number		Description
4.1		First Supplemental Indenture, dated as of January 30, 2002, between Charles River Laboratories, Inc. and the Trustee (Filed as Exhibit 4.3). (1)
4.2		Indenture, dated as of January 24, 2002, between Charles River Laboratories International, Inc. and State Street Bank and Trust Company, as trustee (Filed as Exhibit 4.8). (1)
4.3		Registration Rights Agreement, dated as of January 17, 2002, among Charles River Laboratories International, Inc. and Credit Suisse First Boston Corporation, Lehman Brothers Inc., J.P. Morgan Securities Inc., SG Cowen Securities Corporation, U.S. Bancorp Piper Jaffray Inc., Thomas Weisel Partners LLC, Investec PMG Capital Corp. and Jeffries & Company, Inc. (Filed as Exhibit 4.9). (1)
10.1		Amendment No. 2 to Amended and Restated Credit Agreement and Amendment No. 1 to Amended and Restated Holdco Guaranty and Pledge Agreement, dated January 11, 2002 (Filed as Exhibit 10.3). (1)
10.2		Amendment No. 3 to Amended and Restated Credit Agreement, dated March 30, 2002 (Filed herewith).

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(1)

Previously filed as an exhibit to the Company's Annual Report on Form 10-K, filed March 27, 2002.

        Where a document is incorporated by reference from a previous filing, the Exhibit number of the document in that previous filing is indicated in parentheses after the description of such document.

(b)

The following Current Reports on Form 8-K were filed during the quarter ended March 30, 2002:

        The Company filed a Current Report on Form 8-K on February 14, 2002 to announce, pursuant to Item 5, the consideration to be paid by its wholly-owned subsidiary, Charles River Laboratories, Inc., in its cash tender offer for any and all of its outstanding 13.5% Senior Subordinated Notes due 2009.

        The Company filed a Current Report on Form 8-K on January 30, 2002 to announce, pursuant to Item 5, receipt of requisite consents from holders of the outstanding 13.5% Senior Subordinated Notes due 2009 of its wholly-owned subsidiary, Charles River Laboratories, Inc.

        The Company filed a Current Report on Form 8-K on January 23, 2002 to announce, pursuant to Item 5, the placement of $175 million of its 3.5% Senior Convertible Debentures due 2022.

        The Company filed a Current Report on Form 8-K on January 17, 2002 to announce, pursuant to Item 5, that its wholly-owned subsidiary, Charles River Laboratories, Inc. had commenced a cash tender offer for any and all of its outstanding 13.5% Senior Subordinated Notes due 2009.

        The Company filed a Current Report on Form 8-K on January 17, 2002 to announce, pursuant to Item 5, its intention to offer Senior Convertible Debentures.

19

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SIGNATURE

        Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

CHARLES RIVER LABORATORIES
INTERNATIONAL, INC.

May 9, 2002

/S/ THOMAS F. ACKERMAN

Thomas F. Ackerman
Sr. Vice President and Chief Financial Officer

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QuickLinks

CHARLES RIVER LABORATORIES INTERNATIONAL, INC. FORM 10-Q For the Quarterly Period Ended March 30, 2002 Table of Contents
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) For the three months ended March 30, 2002 and March 31, 2001 (dollars in thousands except for per share data)
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (dollars in thousands)
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (dollars in thousands)
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (dollars in thousands)
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. FORM 10-Q For the Quarterly Period Ended March 30, 2002
SIGNATURE

                                                                Exhibit 10.2

                                                                     ANNEX I

           AMENDMENT NO. 3 TO AMENDED AND RESTATED CREDIT AGREEMENT

     THIS AMENDMENT NO. 3 TO AMENDED AND RESTATED CREDIT AGREEMENT (this
"AMENDMENT"), dated as of March 30, 2002, among Charles River Laboratories,
Inc., a Delaware corporation (the "BORROWER"), Charles River Laboratories
International, Inc. (f/k/a Charles River Laboratories Holdings, Inc.), a
Delaware corporation ("HOLDCO"), Credit Suisse First Boston, as lead
arranger, as sole book runner and as syndication agent (in such capacity, the
"SYNDICATION AGENT") for the Lenders (as defined below), and Fleet National
Bank, as administrative agent (the "ADMINISTRATIVE AGENT") for the Lenders.

                             W I T N E S S E T H:

     WHEREAS, the Borrower, certain financial institutions (together with
their respective successors and assigns, the "LENDERS"), the Syndication
Agent and the Administrative Agent are parties to the Amended and Restated
Credit Agreement, dated as of February 2, 2001 (as heretofore modified and
supplemented and in effect from time to time, the "EXISTING CREDIT AGREEMENT"
and as further amended hereby, the "CREDIT AGREEMENT");

     WHEREAS, the Borrower desires, among other things, to modify the
financial reporting requirements set forth in Article VII of the Existing
Credit Agreement; and

     WHEREAS, the Borrower desires, and the Lenders are willing, on the terms
and subject to the conditions hereinafter set forth, to amend the Existing
Credit Agreement as set forth herein to permit them to do so;

     NOW, THEREFORE, the parties hereto hereby agree as follows:

                                     PART I
                                  DEFINITIONS

     SUBPART 1.1 CERTAIN DEFINITIONS. Unless otherwise defined herein or the
context otherwise requires, terms used in this Amendment, including its
preamble and recitals, have the following meanings (such meanings to be
equally applicable to the singular and plural forms thereof):

     "ADMINISTRATIVE AGENT" is defined in the PREAMBLE.

     "AMENDMENT" is defined in the PREAMBLE.

     "AMENDMENT EFFECTIVE DATE" is defined in SUBPART 3.1.

     "BORROWER" is defined in the PREAMBLE.

     "CREDIT AGREEMENT" is defined in the FIRST RECITAL.





     "EXISTING CREDIT AGREEMENT" is defined in the FIRST RECITAL.

     "HOLDCO" is defined in the PREAMBLE.

     "LENDERS" is defined in the FIRST RECITAL.

     "SYNDICATIONS AGENT" is defined in the PREAMBLE.

     SUBPART 1.2 OTHER DEFINITIONS. Unless otherwise defined herein or the
context otherwise requires, terms used in this Amendment, including its
preamble and recitals, have the meanings set forth in the Existing Credit
Agreement. Each reference to "hereof", "hereunder", "herein" and "hereby" and
each other similar reference and each reference to "this Agreement" and each
other similar reference contained in the Existing Credit Agreement shall from
and after the Amendment Effective Date refer to the Credit Agreement.

                                   PART II
                    AMENDMENTS TO EXISTING CREDIT AGREEMENT

     Effective on (and subject to the occurrence of) the Amendment Effective
Date, the Existing Credit Agreement is hereby amended in accordance with this
Part II. Except to the extent amended by this Agreement, the Existing Credit
Agreement is and shall continue to be in full force and effect and is hereby
ratified and confirmed in all respects.

     SUBPART 2.1 AMENDMENTS TO ARTICLE I. Article I of the Existing Credit
Agreement is amended as set forth in this Subpart 2.1.

     (a) The definition of "EBITDA" contained in Section 1.1 of such Article
is hereby amended to insert the words "Holdco," immediately following the
words "(without duplication) for" and immediately preceding the words "the
Borrower and its Restricted Subsidiaries" in such definition.

     (b) The definition of "Interest Expense" contained in Section 1.1 of
such Article is hereby amended to insert the words "Holdco," immediately
following the words "consolidated interest expense of" and immediately
preceding the words "the Borrower and its Restricted Subsidiaries" in such
definition.

     SUBPART 2.2 AMENDMENTS TO ARTICLE VII. Clauses (a) and (b) of Section
7.1.1 of the Existing Credit Agreement are hereby amended and restated in
their entirety by substituting the following new clauses (a) and (b)
therefor respectively, which clauses shall read as follows:

          "(a) as soon as available and in any event within 60 days after the
          end of each of the first three Fiscal Quarters of each Fiscal Year
          (or, if the Borrower or Holdco is required to file such information
          on a Form 10-Q with the Securities and Exchange Commission, promptly
          following such filing), an unaudited consolidated balance sheet as
          of the end of such Fiscal Quarter, together with the related
          consolidated statements of operations and cash flows for such Fiscal
          Quarter and for the period commencing at the end of the previous
          Fiscal Year and ending with the end of such Fiscal Quarter, for each
          of (i) Holdco and its Subsidiaries (it being understood that


                                      -2-





          the foregoing requirement, as it relates to Holdco, may be satisfied
          by delivery of Holdco's report to the Securities and Exchange
          Commission on Form 10-Q) and (ii) the Borrower and its Subsidiaries
          (it being understood that the foregoing requirement, as it relates
          to the Borrower and its Subsidiaries may be satisfied by delivery
          of Holdco's report to the Securities and Exchange Commission on
          Form 10-Q, if such report contains such information), in each case
          certified by an Authorized Officer that is the president, chief
          executive officer, treasurer, assistant treasurer, controller or
          chief financial or accounting officer of the Borrower or Holdco, as
          applicable;

          (b) as soon as available and in any event within 105 days after the
          end of each Fiscal Year (or, if the Borrower or Holdco is required
          to file such information on a Form 10-K with the Securities and
          Exchange Commission, promptly following such filing), (i) a copy of
          the annual audit report for such Fiscal Year for Holdco and its
          Subsidiaries, including therein a consolidated balance sheet as of
          the end of such Fiscal Year, together with the related consolidated
          statements of operations and cash flows for such Fiscal Year (it
          being understood that the foregoing requirement may be satisfied by
          delivery of Holdco's report to the Securities and Exchange
          Commission on Form 10-K, if any) certified (without any Impermissible
          Qualification) by PricewaterhouseCoopers or another "Big Five" firm
          of independent public accountants, together with a certificate from
          such accountants as to whether, in making the examination necessary
          for the signing of their report on such annual report by such
          accountants, they have become aware of any Default in respect of
          any term, covenant, condition or other provision of this Agreement
          (including any Default in respect of any of the financial covenants
          contained in SECTION 7.2.4) that relates to accounting matters that
          has occurred and is continuing or, if in the opinion of such
          accounting firm such a Default has occurred and is continuing, a
          statement as to the nature thereof and (ii) a copy of the unaudited
          or audited (at the Borrower's option) consolidated balance sheet
          for the Borrower and its Subsidiaries as of the end of such Fiscal
          Year, together with the related unaudited or audited (at the
          Borrower's option) consolidated statements of operations and cash
          flows for such Fiscal Year (it being understood that the foregoing
          requirement may be satisfied by delivery of the Borrower's report
          to the Securities and Exchange Commission on Form 10-K, if such
          report contains such information), certified by an Authorized
          Officer that is the president, chief executive officer of the
          Borrower, together with a certificate from such Authorized Officer
          as to whether, in making the examination necessary for the
          certification of such annual report, such Authorized Officer has
          become aware of any Default in respect of any term, covenant,
          condition or other provision of this Agreement (including any
          Default in respect of any of the financial covenants contained in
          SECTION 7.2.4) that relates to accounting matters that has occurred
          and is continuing or, if in the opinion of such Authorized Officer
          such a Default has occurred and is continuing, a statement as to the
          nature thereof;"


                                       -3-





                                    PART III
                           CONDITIONS TO EFFECTIVENESS

     SUBPART 3.1 AMENDMENT EFFECTIVE DATE. This Amendment shall become
effective as of the date (the "AMENDMENT EFFECTIVE DATE") when the Agents
shall have received counterparts of this Amendment, duly executed by the
Borrower, the Syndication Agent and the Administrative Agent on behalf of the
Required Lenders who shall have delivered to the Administrative Agent their
written consent to the amendments, as explicitly set forth herein and subject
to the terms hereof.

                                     PART IV
                                  MISCELLANEOUS

     SUBPART 4.1 EXPENSES. The Borrower hereby agrees to pay and reimburse
the Agents for all of their respective reasonable fees and expenses incurred
in connection with the negotiation, preparation, execution and delivery of
this Amendment and related documents, including all reasonable fees and
disbursements of Mayer, Brown, Rowe & Maw, counsel to the Agents.

     SUBPART 4.2 BORROWER REPRESENTATIONS AND WARRANTIES. The delivery of an
executed counterpart hereof by the Borrower shall constitute a representation
and warranty by the Borrower that:

          (a) on the Amendment Effective Date, after giving effect to this
     Amendment, (i) all representations, warranties and other statements set
     forth in Article VI of the Existing Credit Agreement, as then amended by
     this Amendment, are true and correct in all material respects as of such
     date, except to the extent that such representation, warranty or
     statement expressly relates to an earlier date (in which case such
     representation, warranty or statement shall have been true and correct in
     all material respects on and as of such earlier date) and (ii) no Default
     has occurred and is then continuing; and

          (b) this Amendment constitutes the legal, valid and binding
     obligation of the Borrower enforceable in accordance with its terms
     subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
     reorganization, moratorium and other similar laws relating to or
     affecting creditors' rights generally, general equitable principles
     (whether considered in a proceeding in equity or at law) and an implied
     covenant of good faith and fair dealing.

     SUBPART 4.3 LOAN DOCUMENT PURSUANT TO CREDIT AGREEMENT. This Amendment
is a Loan Document executed pursuant to the Credit Agreement and shall
(unless otherwise expressly indicated therein) be construed, administered and
applied in accordance with all of the terms and provisions of the Credit
Agreement, as amended hereby.

     SUBPART 4.4 SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon
and inure to the benefit of the parties hereto and their respective
successors and assigns.


                                       -4-





     SUBPART 4.5 COUNTERPARTS. This Amendment may be executed by the parties
hereto in several counterparts, each of which when executed and delivered
shall be an original and all of which shall constitute together but one and
the same agreement.

     SUBPART 4.6 GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK.























                                      -5-





     IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Amendment as of the date first above written.

BORROWER:                              CHARLES RIVER LABORATORIES, INC.

                                       By:
                                          ----------------------------------
                                          Name:
                                          Title:


AGENTS:                                CREDIT SUISSE FIRST BOSTON, as
                                          Syndication Agent

                                       By:
                                          ----------------------------------
                                          Name:
                                          Title:


                                       By:
                                          ----------------------------------
                                          Name:
                                          Title:


                                       FLEET NATIONAL BANK, as Administrative
                                          Agent

                                       By:
                                          ----------------------------------
                                          Name:
                                          Title:





                                       S-1