Delivered Adjusted Diluted Earnings Per Share
Results as Expected; Reaffirm Fiscal 2024 Adjusted Diluted EPS
Outlook
Progressing One Perrigo Blueprint: On Target
to Deliver Project Energize Goals; Enhancing Capabilities;
Completed Divestment of HRA Pharma Rare Diseases Business on
July 10, 2024
DUBLIN, Aug. 2, 2024
/PRNewswire/ --
Second Quarter 2024 Highlights:
- Net sales of $1.1 billion
declined 10.7% versus the prior year quarter. Organic1
net sales decreased 9.1%, due primarily to -6.8 percentage points
from lower net sales of infant formula driven by actions to augment
and strengthen the infant formula network, and -4.0 percentage
points due to lower net sales in the Upper Respiratory and Pain
& Sleep Aids categories stemming from lower seasonal demand.
These factors more than offset organic net sales growth of +1.7
percentage points across the rest of the business.
- Consumer Self-Care International ("CSCI") net sales declined
2.5% compared to the prior year quarter. Organic net sales growth
was +1.0%, including -3.5 percentage points from lower net sales in
the Upper Respiratory and Pain & Sleep Aids categories due to
lower seasonal demand and supply constraints. This impact was
offset by +4.5 percentage points from strength across the rest of
the business.
- Consumer Self-Care Americas ("CSCA") net sales decreased
15.5% compared to the prior year quarter, stemming primarily from
-10.8 percentage points from lower net sales of infant formula
driven by actions to augment and strengthen the infant formula
network, and -4.4 percentage points from lower net sales in the
Upper Respiratory and Pain & Sleep Aids categories due to lower
seasonal demand and SKU prioritization actions to enhance
margins.
- GAAP ("reported") gross margin was 37.0%, a 120 basis points
increase compared to the prior year quarter. Non-GAAP ("adjusted")
gross margin expanded 190 basis points to 40.6%.
- GAAP operating loss was $(27)
million, compared to income of $57
million in the prior year quarter. Adjusted operating income
of $139 million, increased 1.5%
compared to the prior year period. Excluding the year-over-year
impact from infant formula, adjusted operating income grew
16.7%.
- Reported operating margin was (2.5)%, a 730 basis points
decrease compared to the prior year quarter. Adjusted operating
margin expanded 160 basis points to 13.1%, driven primarily by
benefits from Project Energize.
- Reported diluted earnings (loss) per share was $(0.77), compared to reported diluted earnings
per share ("EPS") of $0.06 in the
prior year quarter.
- Adjusted diluted EPS was $0.53, compared to $0.63 in the prior year quarter, a decline of
$0.10 per share due primarily to
discrete tax benefits in the prior year quarter of $0.09 and a year-over-year impact of
-$0.14 per share from infant formula,
which was mostly offset by the rest of the business.
- Cash and cash equivalents2 on the balance sheet
as of June 29, 2024 were $543 million, not including upfront proceeds of
$205 million received from the
divested HRA Pharma Rare Diseases business completed on
July 10, 2024.
First Half 2024 Highlights:
- Net sales of $2.1 billion
decreased 9.6% versus the prior year period. Organic net sales
decreased 8.1%, due primarily to -5.3 percentage points from lower
net sales of infant formula driven by actions to augment and
strengthen the infant formula network, -3.3 percentage points from
lower net sales in the Upper Respiratory and Pain & Sleep Aids
categories (excluding SKU prioritization actions) due to lower
seasonal demand and -2.4 percentage points from SKU prioritization
actions to enhance margins. These factors more than offset organic
net sales growth of +2.9 percentage points across the rest of the
business.
- CSCI first half net sales of $869
million grew 1.0% compared to the prior year period. Organic
net sales grew 3.9%, including -3.6 percentage points from lower
net sales in the Upper Respiratory and Pain & Sleep Aids
categories due to lower seasonal demand and supply constraints.
- CSCA first half net sales of $1.3
billion decreased 15.6% compared to the prior year period,
stemming from -8.6 percentage points from lower net sales of infant
formula, and -6.8 percentage points from SKU prioritization actions
and lower net sales in the Upper Respiratory and Pain & Sleep
Aids categories.
- GAAP operating loss was $(82)
million, compared to income of $105
million in the prior year quarter. Adjusted operating income
of $232 million, decreased 9.6%
compared to the prior year period. Excluding the year-over-year
impact from infant formula, adjusted operating income grew
16.7%
- Reported EPS for the first half of 2024 was a loss of
$(0.74), as compared to earnings per
share of $0.06 in the prior year
period.
- Adjusted diluted EPS for the first half of 2024 was
$0.83, as compared to $1.08 in the prior year period, due primarily to
a year-over-year impact from infant formula of -$0.43 per share and discrete tax benefits in the
prior year period of $0.08 per
share.
Fiscal Year 2024 Outlook:
- Company updates its fiscal 2024 organic net sales growth
outlook versus the prior year to -3% to -1%, from +1% to +3%, and
total net sales growth outlook to -5% to -3% from flat, due
primarily to lower seasonal demand experienced in the first half of
2024 and expected lower distribution in U.S. store brand in
the second half of 2024.
- The Company reaffirms its fiscal 2024 adjusted diluted EPS
outlook of $2.50-$2.65, as increased profitability from faster
than anticipated recovery in the infant formula business, improved
product mix and lower selling expenses are expected to be offset by
flow-through from the updated net sales outlook.
(1) See attached Appendix for details. Change in net
sales on an organic basis excludes the effects of acquisitions,
divestitures, exited product lines and the impact of currency.
(2) The Company has $4.7 million of restricted cash as of June 29,
2024 in cash, cash equivalents and restricted cash on the
Consolidated Balance Sheet. The Company entered into an agreement
to extend a credit line to an existing customer in exchange for a
cash security deposit. The agreement requires the cash to be held
in a separate account and will be returned to the customer at the
expiration of the agreement provided all credits have been paid as
agreed.
(3) All tables and data may not add due to rounding. Percentages
are based on actuals.
|
Perrigo Company plc (NYSE: PRGO) ("Perrigo" or the "Company"), a
leading provider of Consumer Self-Care Products, today
announced financial results from continuing operations for the
second quarter ended June 29, 2024. All comparisons are
against the prior year fiscal second quarter, unless otherwise
noted.
President and CEO, Patrick
Lockwood-Taylor commented, "During the second quarter, we
continued to progress our blueprint to build One Perrigo by driving our Project Energize and
Supply Chain Reinvention efficiency programs and further
consumerizing, simplifying and scaling our business. As we are
building out critical capabilities needed to win in self-care, we
have also faced challenges, notably in the infant formula
regulatory environment in the U.S. as we work together to ensure
the supply of this critical product for caregivers and babies. I
have been especially proud to work alongside my team as we have
addressed these issues head on and with a spirit of resiliency. We
are emerging as a stronger company as a result."
Lockwood-Taylor continued, "Our second quarter topline results
were impacted by actions to augment and strengthen infant formula,
lower seasonal demand compared to the prior year and, to a lesser
extent, final SKU prioritization actions to enhance margins in
CSCA. These factors more than offset growth across the rest of our
portfolio. We continued to execute well throughout our business,
which delivered meaningful margin expansion. And, we achieved first
half 2024 adjusted diluted EPS in line with our 2024 outlook."
Lockwood-Taylor concluded, "We are currently making significant
progress in quality control, production, packaging and release
attainment. We are increasingly confident in the second half profit
recovery of this business, which in addition to improved mix and
lower variable expenses, are expected to offset lower seasonal
demand in the first half of the year and lower distribution in U.S.
store brand in the second half of the year. This leads us to
reaffirm our 2024 adjusted EPS outlook."
Refer to Tables I through VII at the end of this press release
for a reconciliation of non-GAAP adjustments to the current year
and prior year periods and additional non-GAAP information. The
Company's reported results are included in the attached
Consolidated Statements of Operations, Balance Sheets and
Statements of Cash Flows.
Project Energize
Perrigo has successfully transformed into a pure-play consumer
self-care company and is embarking on the next stage of its
self-care journey – evolving to One
Perrigo. This evolution will create sustainable, value
accretive growth through a blended-branded business model that
better positions the Company to win in self-care.
As part of the Company's sustainable, value accretive growth
strategy, the Company launched Project Energize – a global
investment and efficiency program to drive the next evolution of
capabilities and organizational agility during the first quarter of
2024. This three-year program is expected to produce significant
benefits in the Company's long-term business performance by
enabling our One Perrigo growth
strategy, increasing organizational agility and mitigating impacts
from augmenting and strengthening infant formula.
Project Energize is expected to deliver annualized pre-tax
savings in the range of $140 million
to $170 million by 2026. The Company
expects $40 million to $60 million of these savings to be reinvested to
drive its blended-branded business model. Restructuring and related
charges associated with these actions are estimated to be in the
range of $140 million to $160 million, including $20 million to $40
million in investments to enhance capabilities, and are
expected to be substantially incurred by the end of 2026.
Restructuring activities as part of Project Energize are expected
to result in the net reduction of approximately 6% of total Perrigo
roles. Year-to-date, Project Energize has achieved gross savings of
approximately $53 million.
Perrigo Second Quarter 2024 Results from Continuing
Operations
Second Quarter 2024 Net Sales Change
Compared to Prior Year(3)
|
|
Reported
Net Sales
Growth
|
Foreign
Exchange
Impact
|
Constant
Currency Net
Sales
|
Product Line
Exits
|
Organic
Net Sales
Growth
|
CSCA
|
(15.5) %
|
— %
|
(15.5) %
|
(0.4) %
|
(15.1) %
|
CSCI
|
(2.5) %
|
(2.4) %
|
(0.1) %
|
(1.1) %
|
1.0 %
|
Total
Perrigo
|
(10.7) %
|
(0.9) %
|
(9.8) %
|
(0.6) %
|
(9.1) %
|
Second Quarter 2024 Change Compared to
Prior Year(3)
|
(in millions, except
earnings per share; see attached Tables I-IV for reconciliation to
GAAP)
|
|
Three Months
Ended June
29, 2024
|
Three Months
Ended July 1,
2023
|
Percentage
Change YoY
|
Net Sales
|
$1,066
|
$1,193
|
(10.7) %
|
|
|
|
|
Reported Gross
Profit
|
$395
|
$428
|
(7.8) %
|
Reported Gross
Margin
|
37.0 %
|
35.9 %
|
120 bps
|
Reported Operating
(Loss) Income
|
($27)
|
$57
|
n/m
|
Reported Operating
Margin
|
(2.5) %
|
4.8 %
|
(730) bps
|
Reported Net (Loss)
Income
|
($106)
|
$9
|
n/m
|
Reported Diluted (Loss)
Earnings Per Share
|
($0.77)
|
$0.06
|
n/m
|
|
|
|
|
Adjusted Gross
Profit
|
$433
|
$462
|
(6.4) %
|
Adjusted Gross
Margin
|
40.6 %
|
38.7 %
|
190 bps
|
Adjusted Operating
Income
|
$139
|
$137
|
1.5 %
|
Adjusted Operating
Margin
|
13.1 %
|
11.5 %
|
160 bps
|
Adjusted Net
Income
|
$74
|
$87
|
(15.1) %
|
Adjusted Diluted
EPS
|
$0.53
|
$0.63
|
(15.9) %
|
Reported net sales of $1.1 billion
decreased $128 million, or 10.7%, due
primarily to a decline in organic net sales of 9.1%, exited product
lines of -0.6% and foreign currency translation of -0.9%. Organic
net sales comprised strategic pricing actions of +3.7 percentage
points and volume/mix of -12.8 percentage points, due primarily to
actions to augment and strengthen the infant formula network.
Organic net sales were impacted by -6.8 percentage points due to
lower net sales of infant formula and -4.0 percentage points due to
lower net sales in the Upper Respiratory and Pain &
Sleep Aids categories. These factors more than offset organic
net sales growth of +1.7 percentage points across the rest of the
business, led by 1) growth in branded product offerings, including
Compeed®, Mederma® and
EllaOne®, 2) e-commerce growth, and 3) new
products, including the launch of Opill® in the
U.S.
Reported gross profit of $395
million, decreased $33
million, or 7.8%. Adjusted gross profit of $433 million decreased $29
million, or 6.4%, due primarily to actions to augment and
strengthen infant formula, lower net sales volumes and overhead
absorption, and higher cost of goods sold inflation in the CSCI
segment. These factors were partially offset by savings from the
Company's Supply Chain Reinvention and Project Energize
programs.
Reported gross margin was 37.0%, a 120 basis points increase
versus the prior year quarter. Adjusted gross margin expanded 190
basis points to 40.6%, driven by the same factors as adjusted gross
profit, in addition to benefits from purposeful SKU prioritization
actions in CSCA.
Reported operating loss of $27
million compared to operating income of $57 million in the prior year period, due
primarily to restructuring charges related to Project Energize, an
impairment recognized as part of the sale of HRA Pharma Rare
Diseases business and unusual litigation costs. Adjusted operating
income increased $2 million to
$139 million as Project Energize cost
savings and lower variable expenses were partially offset by the
decrease in gross profit. Excluding infant formula from both years,
adjusted operating income grew 16.7%.
Reported operating margin was (2.5)%, a 730 basis points
decrease versus the prior year quarter, due primarily to the same
factors as reported operating loss. Adjusted operating margin was
13.1%, an increase of 160 basis points versus the prior year
quarter, due primarily to adjusted gross margin flow through and
Project Energize cost savings.
Reported net loss was $106
million, or ($0.77) per
diluted share, compared to reported net income of $9 million, or $0.06 per diluted share, in the prior year.
Second quarter 2024 adjusted net income was $74 million, or $0.53 per diluted share, compared to $87 million, or $0.63 per diluted share, in the prior year. The
decline in adjusted EPS of $0.10 was
due primarily to discrete tax benefits in the prior year quarter of
$0.09 and a -$0.14 year-over-year impact from Infant formula,
which was partially offset by the rest of the business.
Second Quarter 2024 Business Segment Results from Continuing
Operations
Consumer Self-Care Americas Segment (CSCA)
Second Quarter 2024 Net Sales Change
Compared to Prior Year(3)
|
|
Reported
Net Sales
Growth
|
Foreign
Exchange
Impact
|
Constant
Currency Net
Sales
|
Product Line
Exits
|
Organic
Net Sales
Growth
|
CSCA
|
(15.5) %
|
— %
|
(15.5) %
|
(0.4) %
|
(15.1) %
|
Second Quarter 2024 Change Compared to
Prior Year(3)
|
|
(in millions, except
earnings per share; see attached Tables I-IV for reconciliation to
GAAP)
|
|
|
Three Months
Ended June
29, 2024
|
Three Months
Ended July 1,
2023
|
Percentage
Change YoY
|
|
CSCA Net
Sales
|
$634
|
$751
|
(15.5) %
|
|
|
|
|
|
|
Reported Gross
Profit
|
$190
|
$225
|
(15.5) %
|
|
Reported Gross
Margin
|
29.9 %
|
29.9 %
|
0 bps
|
|
Reported Operating
Income
|
$69
|
$98
|
(29.1) %
|
|
Reported Operating
Margin
|
10.9 %
|
13.0 %
|
(210) bps
|
|
|
|
|
|
|
Adjusted Gross
Profit
|
$201
|
$229
|
(12.1) %
|
|
Adjusted Gross
Margin
|
31.7 %
|
30.5 %
|
120 bps
|
|
Adjusted Operating
Income
|
$91
|
$114
|
(19.9) %
|
|
Adjusted Operating
Margin
|
14.4 %
|
15.2 %
|
(80) bps
|
|
CSCA reported net sales of $634 million decreased
$117 million, or 15.5%, due primarily to a decline in organic
net sales of 15.1% and exited product lines of -0.4%.
Organic net sales were impacted by 1) -10.8 percentage points
impact from lower net sales of infant formula, and 2) -4.4
percentage points from lower net sales in the Upper
Respiratory and Pain & Sleep Aids categories due to
lower seasonal demand and SKU prioritization actions to enhance
margins. Growth in e-commerce, new products, including
Opill®, and products in the Lifestyle
category were offset by the remaining business.
Reported gross profit of $190 million decreased
$35 million, or 15.5%. Adjusted gross profit declined
$28 million to $201 million due primarily to lower sales
volumes primarily in Nutrition and unfavorable overhead absorption
stemming from OTC manufacturing, partially offset by strategic
pricing actions, and Supply Chain Reinvention and Project Energize
cost savings.
Reported gross margin was 29.9%, flat versus the prior year
quarter. Adjusted gross margin expanded 120 basis points to 31.7%,
driven by the same factors as adjusted gross profit, primarily
Supply Chain Reinvention and Project Energize cost savings.
Reported operating income was $69 million compared to
$98 million in the prior year quarter. Adjusted operating
income declined $23 million, or 19.9%, to $91 million as adjusted gross profit flow through
and higher branded advertising and promotion investments were
partially offset by Project Energize cost savings.
Reported operating margin was 10.9%, a 210 basis points decrease
versus the prior year quarter. Adjusted operating margin declined
80 basis points to 14.4% driven by the same factors as adjusted
operating income.
Consumer Self-Care International Segment (CSCI)
Second Quarter 2024 Net Sales Change
Compared to Prior Year(3)
|
|
Reported
Net Sales
Growth
|
Foreign
Exchange
Impact
|
Constant
Currency Net
Sales
|
Product Line
Exits
|
Organic
Net Sales
Growth
|
CSCI
|
(2.5) %
|
(2.4) %
|
(0.1) %
|
(1.1) %
|
1.0 %
|
Second Quarter 2024 Change Compared to
Prior Year(3)
|
(in millions, except
earnings per share; see attached Tables I-IV for reconciliation to
GAAP)
|
|
Three Months
Ended June
29, 2024
|
Three Months
Ended July 1,
2023
|
Percentage
Change YoY
|
CSCI Net
Sales
|
$431
|
$442
|
(2.5) %
|
|
|
|
|
Reported Gross
Profit
|
$205
|
$204
|
0.7 %
|
Reported Gross
Margin
|
47.5 %
|
46.0 %
|
150 bps
|
Reported Operating
(Loss) Income
|
($10)
|
$9
|
n/m
|
Reported Operating
Margin
|
(2.4) %
|
2.0 %
|
(440) bps
|
|
|
|
|
Adjusted Gross
Profit
|
$231
|
$233
|
(0.7) %
|
Adjusted Gross
Margin
|
53.6 %
|
52.6 %
|
100 bps
|
Adjusted Operating
Income
|
$91
|
$70
|
29.5 %
|
Adjusted Operating
Margin
|
21.0 %
|
15.8 %
|
520 bps
|
CSCI reported net sales growth declined 2.5%, as organic net
sales growth of 1.0%, was more than offset by -1.1% from product
line exits and -2.4% from foreign currency translation.
Organic net sales were driven by growth in the Skin Care
and Women's Health categories stemming from market share
gains in key brands, strategic pricing actions and new products.
These drivers were offset by lower net sales in the Upper
Respiratory and Pain & Sleep Aids categories, due to
lower seasonal demand and supply constraints.
Reported gross profit of $205
million increased $1 million,
or 0.7%. Adjusted gross profit of $231
million declined 0.7%, or an increase of 1.8% on a constant
currency basis, as strategic pricing actions, new products and
Supply Chain Reinvention savings were partially offset by lower
sales volumes and cost of goods sold inflation.
Reported gross margin was 47.5%, an increase of 150 basis points
compared to the prior year quarter. Adjusted gross margin expanded
100 basis points to 53.6% driven by the same factors as adjusted
gross profit.
Reported operating loss was $10
million compared to operating income of $9 million in the prior year quarter. Adjusted
operating income increased 29.5%, or 34.4% on a constant currency
basis, to $91 million, due primarily
to lower advertising and promotion investments and Project Energize
cost savings.
Reported operating margin was (2.4)%, a 440 basis
points decrease versus the prior year quarter, due primarily
to an impairment recognized as part of the sale of HRA Pharma Rare
Diseases business and increased restructuring expenses. Adjusted
operating margin expanded 520 basis points to 21.0%, due
primarily to operating leverage and lower advertising and promotion
investments.
Cash Flow and Balance Sheet
Second quarter 2024 cash from operations was $10 million compared to cash flow of $53 million last year. Capital expenditures were
$29 million compared to $20 million in the prior year. The Company
returned $38 million to shareholders
through dividends during the quarter. Cash and cash
equivalents2 on the balance sheet as of June 29,
2024 were $543 million, not including
proceeds of $205 million received
from the divestment of the HRA Pharma Rare Diseases business
completed on July 10, 2024. Total
debt as of June 29, 2024 was $4.1
billion, flat compared to the prior year.
Fiscal 2024 Outlook
The Company is updating its fiscal 2024 organic net sales growth
outlook versus the prior year to approximately -3% to -1%, from +1%
to +3%, and total net sales growth outlook to -5% to -3% from flat,
due primarily to lower seasonal demand experienced in the first
half of 2024 and expected lower distribution in U.S. store brand in
the second half of 2024.
The Company is reaffirming:
- Interest expense of approximately $180
million,
- Full year adjusted tax rate of approximately 20.5%,
- Adjusted diluted EPS of between $2.50 to $2.65,
and
- Operating cash flow conversion (operating cash flow as a
percentage of adjusted net income) of approximately 90% to
100%.
The Company cannot reconcile its expected organic net sales
growth, adjusted diluted earnings per share to diluted earnings per
share, adjusted tax rate or operating cash flow conversion under
"Fiscal 2024 Outlook" without unreasonable effort because certain
items that impact net income and other reconciling metrics are out
of the Company's control and/or cannot be reasonably predicted at
this time. These items include, but are not limited to uncertainty
of non-recurring infant formula related charges and timing and
amount of restructuring charges and the income tax effects of these
items or other income tax-related events.
About Perrigo
Perrigo Company plc (NYSE: PRGO) is a leading provider of
Consumer Self-Care Products and over-the-counter (OTC) health and
wellness solutions that enhance individual well-being by empowering
consumers to proactively prevent or treat conditions that can be
self-managed. Visit Perrigo online at www.perrigo.com.
Webcast and Conference Call Information
The earnings conference call will be available live via webcast
to interested parties in the investor relations section of the
Perrigo website at http://perrigo.investorroom.com/events-webcasts
or by phone at 888-664-6383, International 416-764-8650, and
reference ID # 294776. A taped replay of the call will be available
beginning at approximately 12:00 P.M. (EST)
Friday, August 2, until midnight Friday, August 9, 2024. To listen to the replay,
dial 888-390-0541, International at 416-764-8677, and use access
code 294776#.
Forward-Looking Statements
Certain statements in this press release are "forward-looking
statements." These statements relate to future events or the
Company's future financial performance and involve known and
unknown risks, uncertainties and other factors that may cause the
actual results, levels of activity, performance or achievements of
the Company or its industry to be materially different from those
expressed or implied by any forward-looking statements. In some
cases, forward-looking statements can be identified by terminology
such as "may," "will," "could," "would," "should," "expect,"
"forecast," "plan," "anticipate," "intend," "believe," "estimate,"
"predict," "potential" or the negative of those terms or other
comparable terminology. The Company has based these forward-looking
statements on its current expectations, assumptions, estimates and
projections. While the Company believes these expectations,
assumptions, estimates and projections are reasonable, such
forward-looking statements are only predictions and involve known
and unknown risks and uncertainties, many of which are beyond the
Company's control, including: supply chain impacts on the Company's
business, including those caused or exacerbated by armed conflict,
trade and other economic sanctions and/or disease; general
economic, credit, and market conditions; the impact of the war in
Ukraine and any escalation
thereof, including the effects of economic and political sanctions
imposed by the United States,
United Kingdom, European Union,
and other countries related thereto; the outbreak or escalation of
conflict in other regions where we do business; current and future
impairment charges, including those related to the sale of the Héra
SAS ("HRA Pharma") Rare Diseases Business, if we determine that the
carrying amount of specific assets may not be recoverable from the
expected future cash flows of such assets; customer acceptance of
new products; competition from other industry participants, some of
whom have greater marketing resources or larger market shares in
certain product categories than the Company does; pricing pressures
from customers and consumers; resolution of uncertain tax positions
and any litigation relating thereto, ongoing or future government
investigations and regulatory initiatives; uncertainty regarding
the Company's ability to obtain and maintain its regulatory
approvals; potential costs and reputational impact of product
recalls or sales halts; potential adverse changes to U.S. and
foreign tax, healthcare and other government policy; the effect of
epidemic or pandemic disease; the timing, amount and cost of any
share repurchases (or the absence thereof) and/or any refinancing
of outstanding debt at or prior to maturity; fluctuations in
currency exchange rates and interest rates; the Company's ability
to achieve benefits expected from its sale of the HRA Rare
Diseases Business, including potential earnout payments, and the
risk that potential costs or liabilities incurred or retained in
connection with that transaction may exceed the Company's estimates
or adversely affect the Company's business or operations; and the
risk that potential costs or liabilities incurred or retained in
connection with the sale of the Company's RX business
transaction may exceed the Company's estimates or adversely affect
the Company's business or operations; the Company's ability to
achieve the benefits expected from the acquisitions of HRA Pharma
and Nestlé's Gateway infant formula plant along with the U.S. and
Canadian rights to the GoodStart® infant formula brand and other
related formula brands ("Gateway") and/or the risks that the
Company's synergy estimates are inaccurate or that the Company
faces higher than anticipated integration or other costs in
connection with the acquisitions; risks associated with the
integration of HRA Pharma and Gateway, including the risk that
growth rates are adversely affected by any delay in the integration
of sales and distribution networks; the consummation and success of
other announced and unannounced acquisitions or dispositions, and
the Company's ability to realize the desired benefits thereof; and
the Company's ability to execute and achieve the desired benefits
of announced cost-reduction efforts and other strategic initiatives
and investments, including the Company's ability to achieve the
expected benefits from its ongoing restructuring programs described
herein. Adverse results with respect to pending litigation could
have a material adverse impact on the Company's operating results,
cash flows and liquidity, and could ultimately require the use of
corporate assets to pay damages, reducing assets that would
otherwise be available for other corporate purposes. These and
other important factors, including those discussed under "Risk
Factors" in the Company's Form 10-K for the year ended December 31, 2023, as well as the Company's
subsequent filings with the United States Securities and Exchange
Commission, may cause actual results, performance or achievements
to differ materially from those expressed or implied by these
forward-looking statements. The forward-looking statements in this
press release are made only as of the date hereof, and unless
otherwise required by applicable securities laws, the Company
disclaims any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events, or otherwise.
Non-GAAP Measures
This press release contains certain non-GAAP measures. A
"non-GAAP financial measure" is defined as a numerical measure of a
company's financial performance that excludes or includes amounts
different from the most directly comparable measure calculated and
presented in accordance with U.S. Generally Accepted Accounting
Principles (GAAP) in the statements of operations, balance sheets
or statements of cash flows of the Company. Pursuant to the
requirements of the U.S. Securities and Exchange Commission, the
Company has provided reconciliations to the most directly
comparable U.S. GAAP measures for the following non-GAAP financial
measures referred to in this press release:
- net sales growth on an organic basis, which excludes
acquisitions, divested businesses, exited product lines, and the
impact of currency,
- adjusted gross profit,
- adjusted net income,
- adjusted operating income,
- adjusted diluted earnings per share,
- constant currency net sales growth, adjusted operating income,
and adjusted gross profit,
- adjusted operating margin, and
- adjusted gross margin.
These non-GAAP financial measures should be considered as
supplements to the GAAP reported measures, should not be considered
replacements for, or superior to the GAAP measures and may not be
comparable to similarly named measures used by other companies. The
Company presents these non-GAAP financial measures in order to
provide transparency to our investors because they are measures
that management uses to assess both management performance and the
financial performance of our operations and to allocate resources.
In addition, management believes that these measures may assist
investors with understanding and evaluating our initiatives to
drive improved financial performance and enables investors to
supplementally compare our operating performance with the operating
performance of our competitors including with those of our
competitors having different capital structures. While we have
excluded certain of these items from historical non-GAAP financial
measures, there is no guarantee that the items excluded from
non-GAAP financial measures will not continue into future
periods. For instance, we expect to continue to experience and
report restructuring-related charges associated with continued
execution of our strategic initiatives.
The Company provides non-GAAP financial measures as additional
information that it believes is useful to investors and analysts in
evaluating the performance of the Company's ongoing operating
trends, facilitating comparability between periods and, where
applicable, with companies in similar industries and assessing the
Company's prospects for future performance. These non-GAAP
financial measures exclude items, such as impairment charges,
restructuring charges, and acquisition and integration-related
charges, that by their nature affect comparability of operational
performance or that we believe obscure underlying business
operational trends. The intangible asset amortization excluded from
these non-GAAP financial measure represents the entire amount
recorded within the Company's GAAP financial statements and is
excluded because the amortization, unlike the related revenue, is
not affected by operations of any particular period unless an
intangible asset becomes impaired or the estimated useful life of
an intangible asset is revised. The revenue generated by the
associated intangible assets has not been excluded from the related
non-GAAP financial measure. The non-GAAP measures the Company
provides are consistent with how management analyzes and assesses
the operating performance of the Company, and disclosing them
provides investor insight into management's view of the business.
Management uses these adjusted financial measures for planning and
forecasting in future periods, and evaluating segment and overall
operating performance. In addition, management uses certain of the
profit measures as factors in determining compensation.
Non-GAAP measures related to profit measurements, which include
adjusted gross profit, adjusted net income, adjusted operating
income, adjusted diluted EPS, adjusted gross margin and adjusted
operating margin are useful to investors as they provide them with
supplemental information to enhance their understanding of the
Company's underlying business performance and trends, and enhance
the ability of investors and analysts to compare the Company's
period-to-period financial results. Management believes that
adjusted gross margin and adjusted operating margin are useful to
investors, in addition to the reasons discussed above, by allowing
them to more easily compare and analyze trends in the Company's
peer business group and assisting them in comparing the Company's
overall performance to that of its competitors. The Company also
discloses net sales growth excluding the impact of currency on an
organic basis. The Company believes these supplemental financial
measures provide investors with consistency in financial reporting,
enabling meaningful comparisons of past and present underlying
operating results, and also facilitate analysis of the Company's
operating performance and acquisition and divestiture trends.
A copy of this press release, including the reconciliations, is
available on the Company's website at www.perrigo.com.
Perrigo Contact
Bradley Joseph, Vice President,
Global Investor Relations & Corporate Communications,
(269) 686-3373 / bradley.joseph@perrigo.com
Nicholas Gallagher, Senior
Manager, Global Investor Relations & Corporate
Communications,
(269) 686-3238 / nicholas.gallagher@perrigo.com
PERRIGO COMPANY
PLC
CONSOLIDATED
STATEMENTS OF OPERATIONS
(in millions, except
per share amounts)
(unaudited)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June 29,
2024
|
|
July 1,
2023
|
|
June 29,
2024
|
|
July 1,
2023
|
Net sales
|
$
1,065.5
|
|
$
1,193.1
|
|
$
2,147.5
|
|
$
2,374.8
|
Cost of
sales
|
670.8
|
|
765.1
|
|
1,395.1
|
|
1,532.9
|
Gross
profit
|
394.7
|
|
428.0
|
|
752.4
|
|
841.9
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
Distribution
|
24.6
|
|
28.6
|
|
49.5
|
|
57.2
|
Research and
development
|
29.4
|
|
32.2
|
|
58.4
|
|
63.3
|
Selling
|
150.1
|
|
171.1
|
|
300.4
|
|
339.0
|
Administration
|
126.1
|
|
132.6
|
|
256.4
|
|
267.6
|
Impairment
charges
|
34.1
|
|
—
|
|
34.1
|
|
—
|
Restructuring
|
36.9
|
|
6.7
|
|
81.3
|
|
10.2
|
Other operating
expense (income), net
|
20.0
|
|
—
|
|
54.0
|
|
(0.8)
|
Total operating
expenses
|
421.2
|
|
371.2
|
|
834.1
|
|
736.5
|
|
|
|
|
|
|
|
|
Operating (loss)
income
|
(26.5)
|
|
56.8
|
|
(81.7)
|
|
105.4
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
44.1
|
|
44.0
|
|
87.1
|
|
87.6
|
Other expense (income),
net
|
3.4
|
|
(9.7)
|
|
3.8
|
|
(9.0)
|
Income (loss) from
continuing operations before
income taxes
|
(74.0)
|
|
22.5
|
|
(172.6)
|
|
26.8
|
Income tax (benefit)
expense
|
31.7
|
|
13.6
|
|
(71.0)
|
|
19.0
|
Income (loss) from
continuing operations
|
(105.7)
|
|
8.9
|
|
(101.6)
|
|
7.8
|
Income (loss) from
discontinued operations, net of tax
|
(2.7)
|
|
(0.5)
|
|
(4.8)
|
|
(2.4)
|
Net income
(loss)
|
$
(108.4)
|
|
$
8.4
|
|
$
(106.4)
|
|
$
5.4
|
|
|
|
|
|
|
|
|
Earnings (loss) per
share
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
|
|
Continuing
operations
|
$
(0.77)
|
|
$
0.07
|
|
$
(0.74)
|
|
$
0.06
|
Discontinued
operations
|
(0.02)
|
|
(—)
|
|
(0.04)
|
|
(0.02)
|
Basic earnings (loss)
per share
|
$
(0.79)
|
|
$
0.06
|
|
$
(0.78)
|
|
$
0.04
|
Diluted
|
|
|
|
|
|
|
|
Continuing
operations
|
$
(0.77)
|
|
$
0.06
|
|
$
(0.74)
|
|
$
0.06
|
Discontinued
operations
|
(0.02)
|
|
(—)
|
|
(0.04)
|
|
(0.02)
|
Diluted earnings
(loss) per share
|
$
(0.79)
|
|
$
0.06
|
|
$
(0.78)
|
|
$
0.04
|
|
|
|
|
|
|
|
|
Weighted-average shares
outstanding
|
|
|
|
|
|
|
|
Basic
|
137.1
|
|
135.3
|
|
136.9
|
|
135.1
|
Diluted
|
137.1
|
|
136.6
|
|
136.9
|
|
136.5
|
PERRIGO COMPANY
PLC
CONSOLIDATED BALANCE
SHEETS
(in millions, except
per share amounts)
(unaudited)
|
|
|
June 29,
2024
|
|
December 31,
2023
|
Assets
|
|
|
|
Cash, cash equivalents
and restricted cash
|
$
542.8
|
|
$
751.3
|
Accounts receivable,
net of allowance for credit losses of $7.6 and $7.8,
respectively
|
726.0
|
|
739.6
|
Inventories
|
1,116.2
|
|
1,140.9
|
Prepaid expenses and
other current assets
|
281.8
|
|
201.1
|
Current assets held
for sale
|
292.3
|
|
—
|
Total current
assets
|
2,959.1
|
|
2,832.9
|
Property, plant and
equipment, net
|
909.9
|
|
916.4
|
Operating lease
assets
|
190.0
|
|
183.6
|
Goodwill and
indefinite-lived intangible assets
|
3,374.8
|
|
3,534.4
|
Definite-lived
intangible assets, net
|
2,633.6
|
|
2,980.8
|
Deferred income
taxes
|
13.8
|
|
25.8
|
Other non-current
assets
|
316.1
|
|
335.2
|
Total non-current
assets
|
7,438.2
|
|
7,976.2
|
Total
assets
|
$
10,397.3
|
|
$
10,809.1
|
Liabilities and
Shareholders' Equity
|
|
|
|
Liabilities
|
|
|
|
Accounts
payable
|
$
471.5
|
|
$
477.7
|
Payroll and related
taxes
|
125.4
|
|
127.0
|
Accrued customer
programs
|
168.6
|
|
163.5
|
Other accrued
liabilities
|
218.5
|
|
335.4
|
Accrued income
taxes
|
11.8
|
|
42.1
|
Current
indebtedness
|
440.8
|
|
440.6
|
Current liabilities
held for sale
|
51.5
|
|
—
|
Total current
liabilities
|
1,488.1
|
|
1,586.3
|
Non-current
liabilities
|
|
|
|
Long-term debt, less
current portion
|
3,616.8
|
|
3,632.8
|
Deferred income
taxes
|
211.7
|
|
262.3
|
Other non-current
liabilities
|
535.4
|
|
559.8
|
Total non-current
liabilities
|
4,363.9
|
|
4,454.9
|
Total
liabilities
|
5,852.0
|
|
6,041.2
|
Contingencies -
Refer to Note 16
|
|
|
|
Shareholders'
equity
|
|
|
|
Controlling
interests:
|
|
|
|
Preferred shares,
$0.0001 par value per share, 10 shares authorized
|
—
|
|
—
|
Ordinary shares,
€0.001 par value per share, 10,000 shares authorized
|
6,786.2
|
|
6,837.5
|
Accumulated other
comprehensive income
|
(54.2)
|
|
10.7
|
Retained earnings
(accumulated deficit)
|
(2,186.7)
|
|
(2,080.3)
|
Total shareholders'
equity
|
4,545.3
|
|
4,767.9
|
Total liabilities and
shareholders' equity
|
$
10,397.3
|
|
$
10,809.1
|
|
|
|
|
Supplemental
Disclosures of Balance Sheet Information
|
|
|
|
Preferred shares,
issued and outstanding
|
—
|
|
—
|
Ordinary shares,
issued and outstanding
|
136.4
|
|
135.5
|
PERRIGO COMPANY
PLC
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in
millions)
(unaudited)
|
|
|
Six Months
Ended
|
|
June 29,
2024
|
|
July 1,
2023
|
Cash Flows From (For)
Operating Activities
|
|
|
|
Net income
(loss)
|
$
(106.4)
|
|
$
5.4
|
Adjustments to derive
cash flows:
|
|
|
|
Depreciation and
amortization
|
163.3
|
|
182.6
|
Settlement of interest
rate derivatives
|
41.2
|
|
—
|
Share-based
compensation
|
38.6
|
|
43.5
|
Restructuring
charges
|
38.3
|
|
10.2
|
Impairment
charges
|
34.1
|
|
—
|
Deferred income
taxes
|
1.3
|
|
(1.8)
|
Amortization of debt
discount
|
0.7
|
|
1.4
|
Gain on sale of
assets
|
—
|
|
(4.0)
|
Other non-cash
adjustments, net
|
15.9
|
|
1.6
|
Subtotal
|
227.0
|
|
238.9
|
Increase (decrease) in
cash due to:
|
|
|
|
Accrued income
taxes
|
(130.8)
|
|
(33.2)
|
Payroll and related
taxes
|
(69.6)
|
|
(42.5)
|
Accounts
receivable
|
(17.3)
|
|
(72.5)
|
Other accrued
liabilities
|
(16.9)
|
|
(0.3)
|
Inventories
|
(2.9)
|
|
(11.1)
|
Accrued customer
programs
|
5.8
|
|
35.1
|
Prepaid expenses and
other current assets
|
12.2
|
|
10.9
|
Accounts
payable
|
13.9
|
|
(68.8)
|
Other operating,
net
|
(13.3)
|
|
15.8
|
Subtotal
|
(218.9)
|
|
(166.6)
|
Net cash from
operating activities
|
8.1
|
|
72.3
|
Cash Flows From (For)
Investing Activities
|
|
|
|
Additions to property,
plant and equipment
|
(53.5)
|
|
(43.2)
|
Settlement of foreign
currency derivatives
|
(45.8)
|
|
—
|
Proceeds from sale of
assets
|
—
|
|
1.8
|
Proceeds from royalty
rights
|
2.5
|
|
17.4
|
Net cash for investing
activities
|
(96.8)
|
|
(24.0)
|
Cash Flows For
Financing Activities
|
|
|
|
Cash
dividends
|
(75.3)
|
|
(73.2)
|
Payments on long-term
debt
|
(19.6)
|
|
(14.9)
|
Other financing,
net
|
(15.3)
|
|
(11.2)
|
Net cash for financing
activities
|
(110.2)
|
|
(99.3)
|
Effect of exchange rate
changes on cash and cash equivalents
|
(9.6)
|
|
5.5
|
Net decrease in cash
and cash equivalents
|
(208.5)
|
|
(45.5)
|
Cash, cash equivalents
and restricted cash of continuing operations, beginning of
period
|
751.3
|
|
600.7
|
Cash, cash equivalents
and restricted cash of continuing operations, end of
period
|
$
542.8
|
|
$
555.2
|
See accompanying Notes to the Condensed
Consolidated Financial Statements.
TABLE
I
PERRIGO COMPANY
PLC
RECONCILIATION OF
NON-GAAP MEASURES
SELECTED
CONSOLIDATED INFORMATION
(in millions, except
per share amounts)
(unaudited)
|
|
|
Three Months Ended
June 29, 2024
|
|
Three Months Ended
July 1, 2023
|
Consolidated
Continuing Operations
|
Gross
Profit
|
Operating
Income (Loss)
|
Income (Loss)
from Continuing
Operations(1)
|
Diluted
Earnings
(Loss) per
Share(1)
|
|
Gross
Profit
|
Operating
Income
|
Income from
Continuing
Operations(1)
|
Diluted
Earnings per
Share(1)
|
Reported
|
$
394.7
|
$
(26.5)
|
$
(105.7)
|
$
(0.77)
|
|
$
428.0
|
$
56.8
|
$
8.9
|
$
0.06
|
As a % of reported net
sales(2)
|
37.0 %
|
(2.5) %
|
(9.9) %
|
|
|
35.9 %
|
4.8 %
|
0.7 %
|
|
Pre-tax
adjustments:
|
|
|
|
|
|
|
|
|
|
Amortization expense
related primarily to acquired
intangible assets
|
33.8
|
57.8
|
58.3
|
0.42
|
|
33.7
|
69.7
|
70.1
|
0.51
|
Restructuring charges
and other termination benefits
|
0.1
|
37.2
|
37.2
|
0.27
|
|
0.1
|
5.8
|
5.8
|
0.04
|
Impairment charges
(3)
|
—
|
34.1
|
34.1
|
0.25
|
|
—
|
—
|
—
|
—
|
Unusual
litigation
|
—
|
26.4
|
26.4
|
0.19
|
|
—
|
2.1
|
2.1
|
0.02
|
Infant formula
remediation
|
3.9
|
4.8
|
4.8
|
0.03
|
|
—
|
—
|
—
|
—
|
Acquisition and
integration-related charges and
contingent consideration adjustments
|
—
|
1.5
|
1.5
|
0.01
|
|
—
|
2.9
|
2.9
|
0.02
|
Milestone payments
received related to royalty
rights
|
—
|
—
|
—
|
—
|
|
—
|
—
|
(10.0)
|
(0.07)
|
Other
(4)
|
—
|
4.1
|
4.1
|
0.03
|
|
—
|
—
|
—
|
—
|
Non-GAAP tax
adjustments(5)
|
—
|
—
|
12.9
|
0.09
|
|
—
|
—
|
6.8
|
0.05
|
Adjusted
|
$
432.5
|
$
139.3
|
$
73.5
|
$
0.53
|
|
$
461.8
|
$
137.3
|
$
86.7
|
$
0.63
|
As a % of reported net
sales(2)
|
40.6 %
|
13.1 %
|
6.9 %
|
|
|
38.7 %
|
11.5 %
|
7.3 %
|
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted
average shares outstanding (in millions)
|
|
|
|
|
|
|
|
|
|
Reported
|
137.1
|
|
|
|
|
136.6
|
Effect of dilution as
reported amount was a loss, while adjusted amount was
income(6)
|
0.4
|
|
|
|
|
—
|
|
|
|
Adjusted
|
137.5
|
|
|
|
|
136.6
|
Note: amounts may not
add or recalculate due to rounding. Percentages are based
on actuals.
|
|
(1) Individual pre-tax
line item adjustments have not been tax effected, as tax expense on
these items are aggregated in the "Non-GAAP tax adjustments" line
item.
|
(2) Reported net sales
for the three months ended June 29, 2024 and July 1, 2023
were $1,065.5 million and $1,193.1 million,
respectively.
|
(3) At June 29, 2024,
we determined the carrying value of the Rare Disease net assets
held for sale exceeded their fair value less cost to sell,
resulting in an impairment charge of $12.0 million. We also
recorded a goodwill impairment charge of $22.1 million resulting in
a total impairment charge of $34.1 million.
|
(4) Other pre-tax
adjustments include $4.1 million related to professional consulting
fees for the divestiture of the Rare Diseases Business.
|
(5 Non-GAAP tax
adjustments for the three months ended June 29, 2024 are
primarily due to $11.9 million of tax expense on pre-tax non-GAAP
adjustments, the interim tax accounting requirements in ASC 740 –
Income Taxes, which include the removal of (1) $25.7 million of tax
impact related to an inter-company sale of intellectual property,
(2) $6.0 million of tax expense related to the HRA Rare Disease
business held-for-sale, (3) $3.6 million of tax benefit related to
a partial valuation allowance release in Belgium, and (4) $3.3
million of tax benefit related to tax impact of termination of
certain derivatives. Non-GAAP tax adjustments for the three
months ended July 1, 2023 are primarily due to $14.3 million
of tax expense related to pre-tax non-GAAP adjustments and the
interim tax accounting requirements in ASC 740 - Income Taxes,
offset by the removal of $20.6 million of tax expense related to
audit settlements.
|
(6) In the period of a
net loss, reported diluted shares outstanding equal basic shares
outstanding.
|
TABLE I
(Continued)
PERRIGO COMPANY
PLC
RECONCILIATION OF
NON-GAAP MEASURES
SELECTED
CONSOLIDATED INFORMATION
(in millions, except
per share amounts)
(unaudited)
|
|
|
Six Months Ended
June 29, 2024
|
|
Six Months Ended
July 1, 2023
|
Consolidated
Continuing Operations
|
Gross
Profit
|
Operating
Income (Loss)
|
Income (Loss)
from Continuing
Operations(1)
|
Diluted
Earnings
(Loss) per
Share(1)
|
|
Gross
Profit
|
Operating
Income
|
Income from
Continuing
Operations(1)
|
Diluted
Earnings per
Share(1)
|
Reported
|
$
752.4
|
$
(81.7)
|
$
(101.6)
|
$
(0.74)
|
|
$
841.9
|
$
105.4
|
$
7.8
|
$
0.06
|
As a % of reported net
sales(2)
|
35.0 %
|
(3.8) %
|
(4.7) %
|
|
|
35.5 %
|
4.4 %
|
0.3 %
|
|
Pre-tax
adjustments:
|
|
|
|
|
|
|
|
|
|
Amortization expense
related primarily to acquired
intangible assets
|
66.5
|
116.5
|
117.5
|
0.86
|
|
62.7
|
135.2
|
136.3
|
0.99
|
Restructuring charges
and other termination benefits
|
0.3
|
81.5
|
81.5
|
0.60
|
|
0.1
|
9.2
|
9.2
|
0.07
|
Unusual
litigation
|
—
|
63.6
|
63.6
|
0.46
|
|
—
|
5.2
|
5.2
|
0.04
|
Impairment
charges(3)
|
—
|
34.1
|
34.1
|
0.25
|
|
—
|
—
|
—
|
—
|
Infant formula
remediation
|
8.8
|
10.5
|
10.5
|
0.08
|
|
—
|
—
|
—
|
—
|
Acquisition and
integration-related charges and
contingent consideration adjustments
|
—
|
1.8
|
1.8
|
0.01
|
|
—
|
6.4
|
6.4
|
0.05
|
Gain on divestitures
and investment securities
|
—
|
—
|
—
|
—
|
|
—
|
(4.6)
|
(4.7)
|
(0.03)
|
Milestone payments
received related to royalty
rights
|
—
|
—
|
—
|
—
|
|
—
|
—
|
(10.0)
|
(0.07)
|
Other(4)
|
—
|
5.9
|
6.0
|
0.04
|
|
—
|
—
|
—
|
—
|
Non-GAAP tax
adjustments(5)
|
—
|
—
|
(99.8)
|
(0.73)
|
|
—
|
—
|
(2.6)
|
(0.02)
|
Adjusted
|
$
828.0
|
$
232.3
|
$
113.8
|
$
0.83
|
|
$
904.7
|
$
256.8
|
$
147.7
|
$
1.08
|
As a % of reported net
sales(2)
|
38.6 %
|
10.8 %
|
5.3 %
|
|
|
38.1 %
|
10.8 %
|
6.2 %
|
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted
average shares outstanding (in millions)
|
|
|
|
|
|
|
|
|
|
Reported
|
136.9
|
|
|
|
|
135.1
|
Effect of dilution as
reported amount was a loss, while adjusted amount was
income(6)
|
0.7
|
|
|
|
|
—
|
|
|
|
Adjusted
|
137.6
|
|
|
|
|
136.5
|
Note: amounts may not
add or recalculate due to rounding. Percentages are based
on actuals.
|
|
(1) Individual pre-tax
line item adjustments have not been tax effected, as tax expense on
these items are aggregated in the "Non-GAAP tax adjustments" line
item.
|
(2) Reported net sales
for the six months ended June 29, 2024 and July 1, 2023
were $2,147.5 million and $2,374.8 million,
respectively.
|
(3) At June 29, 2024,
we determined the carrying value of the Rare Disease net assets
held for sale exceeded their fair value less cost to sell,
resulting in an impairment charge of $12.0 million. We also
recorded a goodwill impairment charge of $22.1 million resulting in
a total impairment charge of $34.1 million.
|
(4) Other pre-tax
adjustments include $5.2 million related to professional consulting
fees for potential divestitures and $0.8 million related to a
foreign jurisdiction transfer tax payment.
|
(5) Non-GAAP tax
adjustments for the six months ended June 29, 2024 are
primarily due to $40.3 million of tax expense on pre-tax non-GAAP
adjustments, the interim tax accounting requirements in ASC 740 –
Income Taxes, which include the removal of (1) $58.4 million tax
impact related to an inter-company sale of intellectual property,
(2) $6.0 million of tax expense related to the HRA Rare Disease
business held-for-sale, (3) $3.6 million of tax benefit related to
a partial valuation allowance release in Belgium, and (4) $3.3
million of tax benefit related to tax impact of termination of
certain derivatives. Non-GAAP tax adjustments for the six
months ended July 1, 2023 are primarily due to $26.7 million
of tax expense related to pre-tax non-GAAP adjustments and the
interim tax accounting requirements in ASC740 - Income Taxes,
offset by the removal of (1) $20.6 million of tax expense related
to audit settlements and (2) $3.0 million of tax expense related to
a valuation allowance.
|
(6) In the period of a
net loss, reported diluted shares outstanding equal basic shares
outstanding.
|
TABLE
II
PERRIGO COMPANY
PLC
RECONCILIATION OF
NON-GAAP MEASURES
SELECTED
CONSOLIDATED INFORMATION
(in millions, except
per share amounts)
(unaudited)
|
|
|
Three Months Ended
June 29, 2024
|
|
Three Months Ended
July 1, 2023
|
Consolidated
Continuing Operations
|
R&D
Expense
|
DSG&A
Expense
|
Restructuring
and Other
|
|
R&D
Expense
|
DSG&A
Expense
|
Restructuring
and Other
|
Reported
|
$
29.4
|
$
320.8
|
$
71.0
|
|
$
32.2
|
$
332.3
|
$
6.7
|
As a % of reported net
sales(1)
|
2.8 %
|
30.1 %
|
6.7 %
|
|
2.7 %
|
27.9 %
|
0.6 %
|
Pre-tax
adjustments:
|
|
|
|
|
|
|
|
Amortization expense
related primarily to acquired
intangible assets
|
(0.2)
|
(23.8)
|
—
|
|
(0.2)
|
(35.7)
|
—
|
Restructuring charges
and other termination benefits
|
—
|
(0.2)
|
(36.9)
|
|
—
|
—
|
(5.7)
|
Impairment
charges(2)
|
—
|
—
|
(34.1)
|
|
—
|
—
|
—
|
Unusual
litigation
|
—
|
(26.4)
|
—
|
|
—
|
(2.1)
|
—
|
Acquisition and
integration-related charges and
contingent consideration adjustments
|
—
|
(1.5)
|
—
|
|
—
|
(2.9)
|
—
|
Infant formula
remediation
|
—
|
(0.9)
|
—
|
|
—
|
—
|
—
|
Other
(3)
|
—
|
(4.1)
|
—
|
|
—
|
—
|
—
|
Adjusted
|
$
29.2
|
$
264.0
|
$
—
|
|
$
32.0
|
$
291.6
|
$
1.0
|
As a % of reported net
sales (1)
|
2.7 %
|
24.8 %
|
— %
|
|
2.7 %
|
24.4 %
|
— %
|
Note: amounts may not
add or recalculate due to rounding. Percentages are based on
actuals.
|
|
(1) Reported net sales
for the three months ended June 29, 2024 and July 1, 2023
were $1,065.5 million and $1,193.1 million,
respectively.
|
(2) At June 29, 2024,
we determined the carrying value of the Rare Disease net assets
held for sale exceeded their fair value less cost to sell,
resulting in an impairment charge of $12.0 million. We also
recorded a goodwill impairment charge of $22.1 million resulting in
a total impairment charge of $34.1 million.
|
(3) Other pre-tax
adjustments include $4.1 million related to professional consulting
fees for the divestiture of the Rare Diseases Business.
|
TABLE II
(Continued)
PERRIGO COMPANY
PLC
RECONCILIATION OF
NON-GAAP MEASURES
SELECTED
CONSOLIDATED INFORMATION
(in millions, except
per share amounts)
(unaudited)
|
|
|
Six Months Ended
June 29, 2024
|
|
Six Months Ended
July 1, 2023
|
Consolidated
Continuing Operations
|
R&D
Expense
|
DSG&A
Expense
|
Restructuring
and Other
|
|
R&D
Expense
|
DSG&A
Expense
|
Restructuring
and Other
|
Reported
|
$
58.4
|
$
660.3
|
$
115.4
|
|
$
63.3
|
$
663.8
|
$
9.4
|
As a % of reported net
sales (1)
|
2.7 %
|
30.7 %
|
5.4 %
|
|
2.7 %
|
28.0 %
|
0.4 %
|
Pre-tax
adjustments:
|
|
|
|
|
|
|
|
Restructuring charges
and other termination benefits
|
—
|
(0.2)
|
(81.1)
|
|
—
|
(0.7)
|
(8.4)
|
Unusual
litigation
|
—
|
(63.6)
|
—
|
|
—
|
(5.2)
|
—
|
Amortization expense
related primarily to acquired
intangible assets
|
(0.4)
|
(49.5)
|
—
|
|
—
|
(72.5)
|
—
|
Impairment
charges(2)
|
—
|
—
|
(34.1)
|
|
—
|
—
|
—
|
Acquisition and
integration-related charges and
contingent consideration adjustments
|
—
|
(1.8)
|
—
|
|
—
|
(6.4)
|
—
|
Infant formula
remediation
|
—
|
(1.8)
|
—
|
|
—
|
—
|
—
|
Loss on divestitures
and investment securities
|
—
|
—
|
—
|
|
—
|
4.6
|
—
|
Other(3)
|
—
|
(6.0)
|
—
|
|
—
|
—
|
—
|
Adjusted
|
$
57.9
|
$
537.6
|
$
0.2
|
|
$
63.3
|
$
583.6
|
$
1.0
|
As a % of reported net
sales (1)
|
2.7 %
|
25.0 %
|
— %
|
|
2.7 %
|
24.6 %
|
— %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: amounts may not
add or recalculate due to rounding. Percentages are based on
actuals.
|
|
(1) Reported net sales
for the six months ended June 29, 2024 and July 1, 2023
were $2,147.5 million and $2,374.8 million,
respectively.
|
(2) At June 29, 2024,
we determined the carrying value of the Rare Disease net assets
held for sale exceeded their fair value less cost to sell,
resulting in an impairment charge of $12.0 million. We also
recorded a goodwill impairment charge of $22.1 million resulting in
a total impairment charge of $34.1 million.
|
(3) Other pre-tax
adjustments include $5.2 million related to professional consulting
fees for potential divestitures and $0.8 million related to a
foreign jurisdiction transfer tax payment.
|
TABLE
III
PERRIGO COMPANY
PLC
RECONCILIATION OF
NON-GAAP MEASURES
SELECTED
CONSOLIDATED INFORMATION
(in millions, except
per share amounts)
(unaudited)
|
|
|
Three Months Ended
June 29, 2024
|
|
Three Months Ended
July 1, 2023
|
Consolidated
Continuing Operations
|
Interest and
Other
|
Income Tax
Expense
(Benefit)
|
|
Interest and
Other
|
Income Tax
Expense
(Benefit)
|
Reported
|
$
47.5
|
$
31.7
|
|
$
34.3
|
$
13.6
|
As a % of reported net
sales (1)
|
4.5 %
|
3.0 %
|
|
2.9 %
|
1.1 %
|
Effective tax
rate
|
|
(42.8) %
|
|
|
60.5 %
|
Pre-tax
adjustments:
|
|
|
|
|
|
Amortization expense
related primarily to acquired
intangible assets
|
(0.5)
|
—
|
|
(0.5)
|
—
|
Milestone payments
received related to royalty
rights
|
—
|
—
|
|
10.0
|
—
|
Non-GAAP tax
adjustments(2)
|
—
|
(12.9)
|
|
—
|
(6.8)
|
Adjusted
|
$
46.9
|
$
18.8
|
|
$
43.8
|
$
6.8
|
As a % of reported net
sales (1)
|
4.4 %
|
1.8 %
|
|
3.7 %
|
0.5 %
|
Adjusted effective tax
rate
|
|
20.4 %
|
|
|
7.3 %
|
Note: amounts may not
add or recalculate due to rounding. Percentages are based on
actuals.
|
|
(1) Reported net sales
for the three months ended June 29, 2024 and July 1, 2023
were $1,065.5 million and $1,193.1 million,
respectively.
|
(2) Non-GAAP tax
adjustments for the three months ended June 29, 2024 are
primarily due to $11.9 million of tax expense on pre-tax non-GAAP
adjustments, the interim tax accounting requirements in ASC 740 –
Income Taxes, which include the removal of (1) $25.7 million of tax
impact related to an inter-company sale of intellectual property,
(2) $6.0 million of tax expense related to the HRA Rare Disease
business held-for-sale, (3) $3.6 million of tax benefit related to
a partial valuation allowance release in Belgium, and (4) $3.3
million of tax benefit related to tax impact of termination of
certain derivatives. Non-GAAP tax adjustments for the three
months ended July 1, 2023 are primarily due to $14.3 million
of tax expense related to pre-tax non-GAAP adjustments and the
interim tax accounting requirements in ASC 740 - Income Taxes,
offset by the removal of $20.6 million of tax expense related to
audit settlements.
|
TABLE III
(Continued)
PERRIGO COMPANY
PLC
RECONCILIATION OF
NON-GAAP MEASURES
SELECTED
CONSOLIDATED INFORMATION
(in millions, except
per share amounts)
(unaudited)
|
|
|
Six Months Ended
June 29, 2024
|
|
Six Months Ended
July 1, 2023
|
Consolidated
Continuing Operations
|
Interest and
Other
|
Income Tax
Expense
(Benefit)
|
|
Interest and
Other
|
Income Tax
Expense
(Benefit)
|
Reported
|
$
90.9
|
$
(71.0)
|
|
$
78.6
|
$
19.0
|
As a % of reported net
sales (1)
|
4.2 %
|
(3.3) %
|
|
3.3 %
|
0.8 %
|
Effective tax
rate
|
|
41.1 %
|
|
|
70.8 %
|
Pre-tax
adjustments:
|
|
|
|
|
|
Amortization expense
primarily related to acquired
intangible assets
|
(1.1)
|
—
|
|
(1.1)
|
—
|
Milestone payments
received related to royalty
rights
|
—
|
—
|
|
10.0
|
—
|
Non-GAAP tax
adjustments(2)
|
—
|
99.8
|
|
—
|
2.6
|
Adjusted
|
$
89.6
|
$
28.8
|
|
$
87.6
|
$
21.6
|
As a % of reported net
sales (1)
|
4.2 %
|
1.3 %
|
|
3.7 %
|
0.9 %
|
Adjusted effective tax
rate
|
|
20.2 %
|
|
|
12.7 %
|
|
|
|
|
|
|
Note: amounts may not
add or recalculate due to rounding. Percentages are based
on actuals.
|
|
(1) Reported net sales
for the six months ended June 29, 2024 and July 1, 2023
were $2,147.5 million and $2,374.8 million,
respectively.
|
(2) Non-GAAP tax
adjustments for the six months ended June 29, 2024 are
primarily due to $40.3 million of tax expense on pre-tax non-GAAP
adjustments, the interim tax accounting requirements in ASC 740 –
Income Taxes, which include the removal of (1) $58.4 million tax
impact related to an inter-company sale of intellectual property,
(2) $6.0 million of tax expense related to the HRA Rare Disease
business held-for-sale, (3) $3.6 million of tax benefit related to
a partial valuation allowance release in Belgium, and (4) $3.3
million of tax benefit related to tax impact of termination of
certain derivatives. Non-GAAP tax adjustments for the six
months ended July 1, 2023 are primarily due to $26.7 million
of tax expense related to pre-tax non-GAAP adjustments and the
interim tax accounting requirements in ASC740 - Income Taxes,
offset by the removal of (1) $20.6 million of tax expense related
to audit settlements and (2) $3.0 million of tax expense related to
a valuation allowance.
|
TABLE
IV
PERRIGO COMPANY
PLC
RECONCILIATION OF
NON-GAAP MEASURES
SELECTED SEGMENT
INFORMATION
(in
millions)
(unaudited)
|
|
|
Three Months Ended
June 29, 2024
|
|
Three Months Ended
July 1, 2023
|
Consumer Self-Care
Americas
|
Gross
Profit
|
R&D
Expense
|
DSG&A
Expense
|
Operating
Income
|
|
Gross
Profit
|
R&D
Expense
|
DSG&A
Expense
|
Operating
Income
|
Reported
|
$
189.7
|
$ 15.0
|
$
103.4
|
$ 69.3
|
|
$
224.5
|
$ 16.9
|
$
108.7
|
$ 97.7
|
As a % of reported net
sales(1)
|
29.9 %
|
2.4 %
|
16.3 %
|
10.9 %
|
|
29.9 %
|
2.3 %
|
14.5 %
|
13.0 %
|
Pre-tax
adjustments:
|
|
|
|
|
|
|
|
|
|
Amortization expense
related primarily to acquired intangible assets
|
7.6
|
—
|
(7.5)
|
15.1
|
|
4.5
|
—
|
(10.2)
|
14.7
|
Infant formula
remediation
|
3.9
|
—
|
(0.9)
|
4.8
|
|
—
|
—
|
—
|
—
|
Restructuring charges
and other termination benefits
|
0.1
|
—
|
—
|
2.2
|
|
—
|
—
|
—
|
1.2
|
Acquisition and
integration-related charges and contingent
consideration adjustments
|
—
|
—
|
(0.1)
|
0.1
|
|
—
|
—
|
(0.5)
|
0.5
|
Adjusted
|
$
201.3
|
$ 15.0
|
$ 94.9
|
$ 91.4
|
|
$
229.0
|
$ 16.9
|
$ 98.0
|
$
114.1
|
As a % of reported net
sales
|
31.7 %
|
2.4 %
|
15.0 %
|
14.4 %
|
|
30.5 %
|
2.3 %
|
13.1 %
|
15.2 %
|
|
|
Three Months Ended
June 29, 2024
|
|
Three Months Ended
July 1, 2023
|
Consumer Self-Care
International
|
Gross
Profit
|
R&D
Expense
|
DSG&A
Expense
|
Operating
(Loss)
Income
|
|
Gross
Profit
|
R&D
Expense
|
DSG&A
Expense
|
Operating
Income
|
Reported
|
$
205.0
|
$ 14.4
|
$
142.6
|
$
(10.3)
|
|
$
203.6
|
$ 15.3
|
$
173.7
|
$
8.8
|
As a % of reported net
sales(1)
|
47.5 %
|
3.3 %
|
33.1 %
|
(2.4) %
|
|
46.0 %
|
3.5 %
|
39.3 %
|
2.0 %
|
Pre-tax
adjustments:
|
|
|
|
|
|
|
|
|
|
Amortization expense
related primarily to acquired intangible assets
|
26.2
|
(0.2)
|
(16.3)
|
42.7
|
|
29.2
|
(0.2)
|
(25.5)
|
55.0
|
Impairment charges
(2)
|
—
|
—
|
—
|
34.1
|
|
—
|
—
|
—
|
—
|
Restructuring charges
and other termination benefits
|
—
|
—
|
—
|
24.2
|
|
—
|
—
|
—
|
5.9
|
Acquisition and
integration-related charges and contingent
consideration adjustments
|
—
|
—
|
—
|
—
|
|
—
|
—
|
(0.4)
|
0.4
|
Adjusted
|
$
231.3
|
$ 14.2
|
$
126.3
|
$ 90.7
|
|
$
232.8
|
$ 15.0
|
$
147.7
|
$ 70.1
|
As a % of reported net
sales
|
53.6 %
|
3.3 %
|
29.3 %
|
21.0 %
|
|
52.6 %
|
3.4 %
|
33.4 %
|
15.8 %
|
|
|
|
|
|
|
|
|
|
|
Note: amounts may not
add or recalculate due to rounding. Percentages are based on
actuals.
|
|
(1) CSCA reported net
sales for the three months ended June 29, 2024 and
July 1, 2023 were $634.1 million and $750.8 million,
respectively. CSCI reported net sales for the three months ended
June 29, 2024 and July 1, 2023 were $431.3 million and
$442.4 million, respectively.
|
(2) At June 29, 2024,
we determined the carrying value of the Rare Disease net assets
held for sale exceeded their fair value less cost to sell,
resulting in an impairment charge of $12.0 million. We also
recorded a goodwill impairment charge of $22.1 million resulting in
a total impairment charge of $34.1 million.
|
TABLE IV
(CONTINUED)
PERRIGO COMPANY
PLC
RECONCILIATION OF
NON-GAAP MEASURES
SELECTED SEGMENT
INFORMATION
(in
millions)
(unaudited)
|
|
|
Six Months Ended
June 29, 2024
|
|
Six Months Ended
July 1, 2023
|
Consumer Self-Care
Americas
|
Gross
Profit
|
R&D
Expense
|
DSG&A
Expense
|
Operating
Income
|
|
Gross
Profit
|
R&D
Expense
|
DSG&A
Expense
|
Operating
Income
|
Reported
|
$
343.3
|
$ 31.3
|
$
208.4
|
$ 85.0
|
|
$
435.3
|
$ 34.9
|
$
217.1
|
$
181.0
|
As a % of reported net
sales (1)
|
26.9 %
|
2.5 %
|
16.3 %
|
6.6 %
|
|
28.7 %
|
2.3 %
|
14.3 %
|
12.0 %
|
Pre-tax
adjustments:
|
|
|
|
|
|
|
|
|
|
Amortization expense
related primarily to acquired intangible assets
|
12.2
|
—
|
(17.5)
|
29.7
|
|
8.3
|
—
|
(20.3)
|
28.6
|
Restructuring charges
and other termination benefits
|
0.3
|
—
|
—
|
18.7
|
|
0.1
|
—
|
—
|
2.4
|
Infant formula
remediation
|
8.8
|
|
(1.8)
|
10.5
|
|
—
|
—
|
—
|
—
|
Acquisition and
integration-related charges and contingent
consideration adjustments
|
—
|
—
|
(0.2)
|
0.2
|
|
—
|
—
|
(1.3)
|
1.3
|
Adjusted
|
$
364.5
|
$ 31.3
|
$
189.0
|
$
144.1
|
|
$
443.7
|
$ 34.9
|
$
195.5
|
$
213.2
|
As a % of reported net
sales (1)
|
28.5 %
|
2.5 %
|
14.8 %
|
11.3 %
|
|
29.3 %
|
2.3 %
|
12.9 %
|
14.1 %
|
|
|
Six Months Ended
June 29, 2024
|
|
Six Months Ended
July 1, 2023
|
Consumer Self-Care
International
|
Gross
Profit
|
R&D
Expense
|
DSG&A
Expense
|
Operating
Income
|
|
Gross
Profit
|
R&D
Expense
|
DSG&A
Expense
|
Operating
Income
|
Reported
|
$
409.2
|
$ 27.0
|
$
292.1
|
$ 16.2
|
|
$
406.6
|
$ 28.3
|
$
342.3
|
$ 30.0
|
As a % of reported net
sales (1)
|
47.1 %
|
3.1 %
|
33.6 %
|
1.9 %
|
|
47.3 %
|
3.3 %
|
39.8 %
|
3.5 %
|
Pre-tax
adjustments:
|
|
|
|
|
|
|
|
|
|
Amortization expense
related primarily to acquired
intangible
assets
|
54.4
|
(0.4)
|
(32.0)
|
86.8
|
|
54.4
|
—
|
(52.3)
|
106.7
|
Restructuring charges
and other termination benefits
|
—
|
—
|
—
|
39.8
|
|
—
|
—
|
(0.7)
|
6.7
|
Impairment charges
(2)
|
—
|
—
|
—
|
34.1
|
|
—
|
—
|
—
|
—
|
Acquisition and
integration-related charges and contingent
consideration
adjustments
|
—
|
—
|
—
|
—
|
|
—
|
—
|
(1.5)
|
1.5
|
(Gain) loss on
divestitures
|
—
|
—
|
—
|
—
|
|
—
|
—
|
4.6
|
(4.6)
|
Adjusted
|
$
463.6
|
$ 26.6
|
$
260.1
|
$
176.8
|
|
$
461.0
|
$ 28.3
|
$
292.3
|
$
140.3
|
As a % of reported net
sales (1)
|
53.3 %
|
3.1 %
|
29.9 %
|
20.3 %
|
|
53.6 %
|
3.3 %
|
34.0 %
|
16.3 %
|
Note: amounts may not
add or recalculate due to rounding. Percentages are based on
actuals.
|
|
(1) CSCA reported net
sales for the six months ended June 29, 2024 and July 1,
2023 were $1,278.3 million and $1,514.4 million, respectively. CSCI
reported net sales for the six months ended June 29, 2024 and
July 1, 2023 were $869.3 million and $860.4 million,
respectively.
|
(2) At June 29, 2024,
we determined the carrying value of the Rare Disease net assets
held for sale exceeded their fair value less cost to sell,
resulting in an impairment charge of $12.0 million. We also
recorded a goodwill impairment charge of $22.1 million resulting in
a total impairment charge of $34.1 million.
|
TABLE
V
PERRIGO COMPANY
PLC
RECONCILIATION OF
NON-GAAP MEASURES
CONSOLIDATED AND
SELECTED SEGMENT INFORMATION
(in millions, except
per share amounts)
(unaudited)
|
|
|
Three Months
Ended
|
|
|
|
Six Months
Ended
|
|
|
Consolidated
Continuing Operations
|
June 29,
2024
|
|
July 1,
2023
|
|
%
Change
|
|
June 29,
2024
|
|
July 1,
2023
|
|
%
Change
|
Net Sales
|
$
1,065.5
|
|
$
1,193.1
|
|
(10.7) %
|
|
$
2,147.5
|
|
$
2,374.8
|
|
(9.6) %
|
Less: Currency
impact(1)
|
(11.0)
|
|
—
|
|
(0.9) %
|
|
(14.0)
|
|
—
|
|
(0.6) %
|
Constant currency net
sales
|
$
1,076.5
|
|
$
1,193.1
|
|
(9.8) %
|
|
$
2,161.5
|
|
$
2,374.8
|
|
(9.0) %
|
Less: Exited product
lines(2)
|
5.2
|
|
13.5
|
|
(0.6) %
|
|
11.2
|
|
34.7
|
|
(0.9) %
|
Organic net
sales
|
$
1,071.3
|
|
$
1,179.6
|
|
(9.1) %
|
|
$
2,150.3
|
|
$
2,340.1
|
|
(8.1) %
|
|
|
|
|
Three Months
Ended
|
|
|
|
Six Months
Ended
|
|
|
Consumer Self-Care
Americas
|
June 29,
2024
|
|
July 1,
2023
|
|
%
Change
|
|
June 29,
2024
|
|
July 1,
2023
|
|
%
Change
|
Net Sales
|
$
634.1
|
|
$
750.8
|
|
(15.5) %
|
|
$
1,278.3
|
|
$
1,514.4
|
|
(15.6) %
|
Less: Currency
impact(1)
|
(0.2)
|
|
—
|
|
— %
|
|
(0.2)
|
|
—
|
|
— %
|
Constant currency net
sales
|
$
634.4
|
|
$
750.8
|
|
(15.5) %
|
|
$
1,278.4
|
|
$
1,514.4
|
|
(15.6) %
|
Less: Exited product
lines(2)
|
—
|
|
3.5
|
|
(0.4) %
|
|
0.2
|
|
13.0
|
|
(0.7) %
|
Organic net
sales
|
$
634.4
|
|
$
747.3
|
|
(15.1) %
|
|
$
1,278.2
|
|
$
1,501.4
|
|
(14.9) %
|
|
|
Three Months
Ended
|
|
|
|
Six Months
Ended
|
|
|
Consumer Self-Care
International
|
June 29,
2024
|
|
July 1,
2023
|
|
%
Change
|
|
June 29,
2024
|
|
July 1,
2023
|
|
%
Change
|
Net Sales
|
$
431.3
|
|
$
442.4
|
|
(2.5) %
|
|
$
869.3
|
|
$
860.4
|
|
1.0 %
|
Less: Currency
impact(1)
|
(10.8)
|
|
—
|
|
(2.4) %
|
|
(13.8)
|
|
—
|
|
(1.6) %
|
Constant currency net
sales
|
$
442.1
|
|
$
442.4
|
|
(0.1) %
|
|
$
883.0
|
|
$
860.4
|
|
2.6 %
|
Less: Exited product
lines(2)
|
5.3
|
|
10.1
|
|
(1.1) %
|
|
11.0
|
|
21.7
|
|
(1.3) %
|
Organic net
sales
|
$
436.8
|
|
$
432.3
|
|
1.0 %
|
|
$
872.0
|
|
$
838.7
|
|
3.9 %
|
Note: amounts may not
add or recalculate due to rounding. Percentages are based on
actuals.
|
|
(1) Currency impact is
calculated using the exchange rates used to translate our financial
statements in the comparable prior year period to show what current
period US dollar results would have been if such currency exchange
rates had not changed.
|
(2) Exited product
lines represents strategic actions taken across multiple product
categories as part of our Supply Chain Reinvention Program,
primarily driven by exited products within the Skincare category in
CSCA and CSCI, the Nutrition category in CSCA and Upper Respiratory
in CSCA and CSCI.
|
|
TABLE
VI
PERRIGO COMPANY
PLC
RECONCILIATION OF
NON-GAAP MEASURES
SELECTED SEGMENT
INFORMATION
(in millions, except
per share amounts)
(unaudited)
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
Six Months
Ended
|
|
|
|
|
|
CSCA Net
Sales(1)
|
June 29,
2024
|
|
July 1,
2023
|
|
Change
|
|
June 29,
2024
|
|
July 1,
2023
|
|
Change
|
|
Digestive
Health
|
$
126.0
|
|
$
126.1
|
|
$
(0.1)
|
|
(0.1) %
|
|
$
248.2
|
|
$
250.1
|
|
$
(1.9)
|
|
(0.8) %
|
|
Upper
Respiratory
|
118.8
|
|
137.3
|
|
(18.5)
|
|
(13.4) %
|
|
249.1
|
|
291.0
|
|
(41.9)
|
|
(14.4) %
|
|
Nutrition
|
86.1
|
|
168.1
|
|
(82.0)
|
|
(48.8) %
|
|
176.7
|
|
306.6
|
|
(129.9)
|
|
(42.4) %
|
|
Pain and
Sleep-Aids
|
81.6
|
|
96.7
|
|
(15.1)
|
|
(15.6) %
|
|
164.2
|
|
200.1
|
|
(35.9)
|
|
(17.9) %
|
|
Oral Care
|
73.2
|
|
75.5
|
|
(2.3)
|
|
(3.0) %
|
|
137.9
|
|
158.8
|
|
(20.9)
|
|
(13.2) %
|
|
Healthy
Lifestyle
|
69.1
|
|
66.5
|
|
2.6
|
|
3.9 %
|
|
140.4
|
|
139.9
|
|
0.5
|
|
0.4 %
|
|
Skin Care
|
57.1
|
|
61.8
|
|
(4.7)
|
|
(7.7) %
|
|
106.7
|
|
131.6
|
|
(24.9)
|
|
(18.9) %
|
|
Women's
Health
|
16.8
|
|
12.8
|
|
4.0
|
|
31.4 %
|
|
44.0
|
|
25.1
|
|
18.9
|
|
75.3 %
|
|
VMS and Other
CSCA
|
5.4
|
|
6.0
|
|
(0.6)
|
|
(8.7) %
|
|
11.1
|
|
11.2
|
|
(0.1)
|
|
(0.9) %
|
|
Total CSCA Net
Sales
|
$
634.1
|
|
$
750.8
|
|
$
(116.7)
|
|
(15.5) %
|
|
$
1,278.3
|
|
$
1,514.4
|
|
$ (236.2)
|
|
(15.6) %
|
|
Note: amounts may not
add or recalculate due to rounding. Percentages are based
on actuals.
|
|
(1) We updated our
global reporting product categories as a result of legacy sales
being moved out of Other CSCA and into respective categories. These
product categories have been adjusted retroactively to reflect the
changes and have no impact on historical financial position,
results of operations, or cash flows.
|
Primary CSCA Second Quarter Category Drivers:
- Digestive Health: Net sales of $126 million
decreased 0.1% as higher volumes of antacid products, including
Famotidine and Esomeprazole, and laxative products,
including Polyethylene Glycol, were more than offset by
lower volume of Omeprazole and 0.8 percentage points
reduction from exited product lines and portfolio optimization
actions.
- Upper Respiratory: Net sales of $119 million
decreased 13.4% due primarily to lower consumer demand for cough
cold and allergy products. The category was also impacted by 8.4
percentage points reduction from exited product lines and portfolio
optimization actions, in addition to net lost distribution of lower
margin products. These dynamics more than offset strong
double-digit growth of Nasonex®.
- Nutrition: Net sales of $86 million decreased
48.8% due primarily to lower shipments to customers as the company
works through its infant formula plant remediation plans, in
addition to a 0.4 percentage points reduction from exited product
lines.
- Pain & Sleep-Aids: Net sales of
$82 million decreased 15.6% due primarily to net lost
distribution of lower margin products, in addition to a 1.1
percentage point reduction from exited product lines and purposeful
SKU prioritization actions.
- Oral Care: Net sales of $73 million decreased
3.0% due primarily to lower distribution at specific retail
customers partially offset by higher net sales of
Reach® and Firefly®
toothbrushes.
- Healthy Lifestyle: Net sales of $69 million
increased 3.9% due primarily to higher net sales of nicotine
lozenges, including the new product launch of the Nicotine Ice
Mint Lozenge.
- Skin Care: Net sales of $57 million decreased
7.7% due primarily to lower contract manufacturing sales and a 2.2
percentage point reduction from exited product lines and portfolio
optimization actions. These dynamics more than offset strong
double-digit growth of Mederma®.
- Women's Health: Net sales of $17 million
increased 31.4% due primarily to the recent launch of
Opill®, which was partially offset by a 5.2
percentage point reduction from exited product lines.
- Vitamins, Minerals, and Supplements ("VMS") and
Other: Net sales of $5 million decreased 8.7%.
TABLE VI
(Continued)
PERRIGO COMPANY
PLC
RECONCILIATION OF
NON-GAAP MEASURES
SELECTED SEGMENT
INFORMATION
(in millions, except
per share amounts)
(unaudited)
|
|
|
Three Months
Ended
|
|
|
|
|
|
Constant
Currency
Change (1)
|
|
Six Months
Ended
|
|
|
|
|
|
Constant
Currency
Change (1)
|
CSCI Net
Sales
|
June 29,
2024
|
|
July 1,
2023
|
|
%
Change
|
|
Currency
Impact (1)
|
|
|
June 29,
2024
|
|
July 1,
2023
|
|
%
Change
|
|
Currency
Impact (1)
|
|
Skin Care
|
$
127.7
|
|
$
123.0
|
|
3.8 %
|
|
4.8 %
|
|
8.7 %
|
|
$
242.4
|
|
$
206.4
|
|
17.4 %
|
|
4.3 %
|
|
21.7 %
|
Healthy
Lifestyle
|
57.5
|
|
60.6
|
|
(5.2) %
|
|
5.0 %
|
|
(0.2) %
|
|
122.1
|
|
127.0
|
|
(3.8) %
|
|
6.3 %
|
|
2.4 %
|
Upper
Respiratory
|
50.7
|
|
64.9
|
|
(21.9) %
|
|
0.4 %
|
|
(21.4) %
|
|
119.8
|
|
149.7
|
|
(20.0) %
|
|
(0.8) %
|
|
(20.7) %
|
Pain and
Sleep-Aids
|
50.3
|
|
52.8
|
|
(4.8) %
|
|
0.1 %
|
|
(4.7) %
|
|
101.7
|
|
102.7
|
|
(1.0) %
|
|
(1.8) %
|
|
(2.9) %
|
VMS
|
39.9
|
|
41.5
|
|
(3.9) %
|
|
1.0 %
|
|
(2.9) %
|
|
84.5
|
|
89.3
|
|
(5.4) %
|
|
(0.1) %
|
|
(5.5) %
|
Women's
Health
|
36.9
|
|
31.9
|
|
15.6 %
|
|
1.3 %
|
|
16.9 %
|
|
68.9
|
|
61.0
|
|
13.0 %
|
|
0.6 %
|
|
13.6 %
|
Oral Care
|
23.0
|
|
21.6
|
|
6.6 %
|
|
0.2 %
|
|
6.8 %
|
|
51.7
|
|
50.7
|
|
2.0 %
|
|
(1.1) %
|
|
0.9 %
|
Digestive Health and
Other CSCI
|
45.3
|
|
46.1
|
|
(1.5) %
|
|
1.3 %
|
|
(0.2) %
|
|
78.1
|
|
73.6
|
|
6.1 %
|
|
0.5 %
|
|
6.6 %
|
Total CSCI Net
Sales
|
$
431.3
|
|
$
442.4
|
|
(2.5) %
|
|
2.4 %
|
|
(0.1) %
|
|
$
869.3
|
|
$
860.4
|
|
1.0 %
|
|
1.6 %
|
|
2.6 %
|
Note: amounts may not
add or recalculate due to rounding. Percentages are based
on actuals.
|
(1) Currency impact is
calculated using the exchange rates used to translate our financial
statements in the comparable prior year period to show what current
period US dollar results would have been if such currency exchange
rates had not changed.
|
Primary CSCI Second Quarter Category Drivers:
- Skin Care: Net sales of $128 million increased
3.8%, or 8.7% excluding the impact of currency, due to strong
growth in store brands and Compeed® driven by
market share gains, higher net sales within the
Sebamed® brand portfolio, and the absence of
prior year distribution transitions.
- Upper Respiratory: Net sales of $51 million
decreased 21.9%, or 21.4% excluding the impact of currency, due
primarily to lower seasonal demand for cough cold and allergy
products throughout Europe and
supply constraints on several products.
- Healthy Lifestyle: Net sales of $58 million
decreased 5.2%, or a decrease of 0.2% excluding the impact of
currency, as higher consumption for anti-parasite products
including Paranix®, were more than offset by
lower category consumption in weight loss, impacting XLS
Medical®.
- Pain & Sleep-Aids: Net sales of
$50 million decreased 4.8%, or a decrease of 4.7% excluding
the impact of currency, due primarily to lower net sales of
Solpadeine®, due primarily to supply constraints,
and lower net sales of store brand products due primarily to lower
seasonal demand for pain products, partially offset by higher net
sales of Tiger Balm® for muscle relief.
- VMS: Net sales of $40 million decreased 3.9%,
or 2.9% excluding the impact of currency, due primarily to lower
net sales of nutraceutical products, including
Arterin® and Granufink®,
stemming from lower consumption. These dynamics were partially
offset by higher net sales of Abtei® and
promotional phasing of Davitamon®.
- Women's Health: Net sales of $37 million
increased 15.6%, or 16.9% excluding the impact of currency, due
primarily to higher net sales of contraceptive products including
EllaOne®, driven by market share gains and the
absence of prior year distribution transitions.
- Oral Care: Net sales of $23 million increased
6.6%, or 6.8% excluding the impact of currency, due primarily to
higher net sales of Plackers® and store brand
offerings.
- Digestive Health and Other: Net sales of
$45 million decreased 1.5%, or 0.2% excluding the impact of
currency, as higher net sales of Clément® –
Thékan® and Omron® were more than
offset by lower net sales of Kijimea®.
TABLE
VII
PERRIGO COMPANY
PLC
RECONCILIATION OF
NON-GAAP MEASURES
CONSOLIDATED AND
SELECTED SEGMENT INFORMATION
(in millions, except
per share amounts)
(unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
Six Months
Ended
|
|
|
|
|
Consolidated
Continuing Operations
|
|
June 29,
2024
|
|
July 1,
2023
|
|
Total
Change
|
|
June 29,
2024
|
|
July 1,
2023
|
|
Total
Change
|
Adjusted gross
profit
|
|
$ 432.5
|
|
$ 461.8
|
|
$
(29.4)
|
|
(6.4) %
|
|
$ 828.0
|
|
$ 904.7
|
|
$ (76.7)
|
|
(8.5) %
|
Adjusted gross
margin
|
|
40.6 %
|
|
38.7 %
|
|
|
|
190 bps
|
|
38.6 %
|
|
38.1 %
|
|
|
|
50 bps
|
Adjusted operating
income
|
|
$ 139.3
|
|
$ 137.3
|
|
$
2.0
|
|
1.5 %
|
|
$ 232.3
|
|
$ 256.8
|
|
$ (24.6)
|
|
(9.6) %
|
Adjusted operating
margin
|
|
13.1 %
|
|
11.5 %
|
|
|
|
160 bps
|
|
10.8 %
|
|
10.8 %
|
|
|
|
— bps
|
Infant formula YoY
impact
|
|
20.8
|
|
—
|
|
|
|
|
|
67.5
|
|
—
|
|
|
|
|
Adjusted operating
income excluding infant formula YoY impact
|
|
$ 160.1
|
|
$ 137.3
|
|
|
|
16.7 %
|
|
$ 299.8
|
|
$ 256.8
|
|
|
|
16.7 %
|
Adjusted EPS
|
|
$ 0.53
|
|
$ 0.63
|
|
$
(0.10)
|
|
(15.9) %
|
|
$ 0.83
|
|
$ 1.08
|
|
$ (0.25)
|
|
(23.1) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer Self-Care
Americas
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted gross
profit
|
|
$ 201.3
|
|
$ 229.0
|
|
$
(27.8)
|
|
(12.1) %
|
|
$ 364.5
|
|
$ 31.3
|
|
$ (79.2)
|
|
(17.9) %
|
Adjusted gross
margin
|
|
31.7 %
|
|
30.5 %
|
|
|
|
120 bps
|
|
28.5 %
|
|
29.3 %
|
|
|
|
(80) bps
|
Adjusted operating
income
|
|
$ 91.4
|
|
$ 114.1
|
|
$
(22.7)
|
|
(19.9) %
|
|
$ 144.1
|
|
$ 213.2
|
|
$ (69.1)
|
|
(32.4) %
|
Adjusted operating
margin
|
|
14.4 %
|
|
15.2 %
|
|
|
|
(80) bps
|
|
11.3 %
|
|
14.1 %
|
|
|
|
(280) bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer Self-Care
International
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted gross
profit
|
|
$ 231.3
|
|
$ 232.8
|
|
|
|
(0.7) %
|
|
$ 463.6
|
|
$ 461.0
|
|
$
2.6
|
|
0.6 %
|
Adjusted gross
margin
|
|
53.6 %
|
|
52.6 %
|
|
|
|
100 bps
|
|
53.3 %
|
|
53.6 %
|
|
|
|
(30) bps
|
Less: Currency
impact(1)
|
|
(5.8)
|
|
—
|
|
|
|
|
|
(6.8)
|
|
—
|
|
|
|
|
Constant currency
adjusted gross profit
|
|
$ 237.1
|
|
$ 232.8
|
|
|
|
1.8 %
|
|
$ 470.4
|
|
$ 461.0
|
|
$
9.4
|
|
2.0 %
|
Adjusted operating
income
|
|
$ 90.7
|
|
$ 70.1
|
|
|
|
29.5 %
|
|
$ 176.8
|
|
$ 140.3
|
|
$ 36.5
|
|
26.0 %
|
Adjusted operating
margin
|
|
21.0 %
|
|
15.8 %
|
|
|
|
520 bps
|
|
20.3 %
|
|
16.3 %
|
|
|
|
400 bps
|
Less: Currency
impact(1)
|
|
(3.4)
|
|
—
|
|
|
|
|
|
(4.8)
|
|
|
|
|
|
|
Constant currency
adjusted operating income
|
|
$ 94.1
|
|
$ 70.1
|
|
$
24.1
|
|
34.4 %
|
|
$ 181.6
|
|
$ 140.3
|
|
$ 41.3
|
|
29.4 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: amounts may not
add or recalculate due to rounding. Percentages are based on
actuals.
|
(1) Currency impact is
calculated using the exchange rates used to translate our financial
statements in the comparable prior year period to show what current
period US dollar results would have been
|
if such currency
exchange rates had not changed.
|
View original content to download
multimedia:https://www.prnewswire.com/news-releases/perrigo-reports-second-quarter-2024-financial-results-from-continuing-operations-302213348.html
SOURCE Perrigo Company plc