Perrigo Company Plc · NYSE:PRGO
Perrigo — Q2 2024 Earnings Presentation
35 slides from Perrigo's earnings presentation, Aug 2, 2024
Slide 1: Q2/2024 Earnings Presentation – 8/2/24
Q2/2024 Earnings Presentation – 8/2/24
Slide 2: Bradley Joseph, VP Investor Relations & Corporate Communications
VP Investor Relations & Bradley Joseph Corporate Communications
Slide 3: Forward-Looking Statements
Forward-Looking Statements Certain statements in this presentation 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 o
Slide 4: Patrick Lockwood-Taylor, President & CEO
Patrick Lockwood-Taylor President & CEO
Slide 5: My First Year in Action: Building One Perrigo
My First Year in Action: Building One Perrigo Core Competencies: Our right to win in self-care Store Brand Breadth of Expansive Regulatory Enabled Scale Innovation Supply Chain Impact Long-Term Enablers: Fuel for our growth and success Winning Brand Building Focused Disciplined Project Energize Cult
Slide 6: Delivered 1H'24 Expectations
Delivered 1H’24 Expectations What We Said What We Delivered Efforts to augment and Infant formula impacted 1H’24 net sales by strengthen infant formula -5.3 percentage points and adj. EPS by will impact 1H’24 results -$0.43 vs. prior year Expect 2024 adj. gross Delivered 1H’24 adj. gross margin of m
Slide 7: Aligning Expectations with Current Business Dynamics
Aligning Expectations with Current Business Dynamics What’s Changed What’s the Impact Increasingly confident in infant Expect 2H’24 profitability to recover formula business recovery faster than anticipated Lower global seasonal demand and Impact to Perrigo FY’24 net sales U.S. inventory destocking
Slide 8: Q2'24 Earnings – Delivered Adj. EPS as Expected; Topline Impacts Mitigated
Q2’24 Earnings – Delivered Adj. EPS as Expected; Topline Impacts Were Mitigated by Strong Margin Expansion YoY Q2’24 Comments Change Reported Net Sales $1,066 -10.7% • Organic net sales included: o -6.8 ppts from infant formula Organic Net Sales - -9.1% o -4.0 ppts from lower net sales in Upper Resp
Slide 9: Q2'24 Earnings – Infant Formula & Seasonal Categories More Than Offset Growth
Q2’24 Earnings – Infant Formula & Seasonal Categories More Than Offset Growth in Rest of Business Organic Net Sales % Change YoY by Category Global OTC Brands Q2'24 Organic Net Sales -9.1% Organic Net Sales Growth YoY +1.6% Nutrition -48.4% -6.8 ppts from infant formula Upper Respiratory -15.4% -4.0
Slide 10: On Track to Deliver 2024 Operational Priorities
On Track to Deliver 2024 Operational Priorities Priority Progress Augment and Strengthen ✓ Increasingly Confident in 2H’24 as Volumes and Sales are Recovering Infant Formula Launch Opill® with ✓ Opill® is Available at >65,000 U.S. Retail Locations Nationwide Excellence ✓ Learning and Adjusting Adver
Slide 11: Increasingly Confident in 2H'24 Infant Formula Recovery
Increasingly Confident in 2H’24 Infant Formula Recovery ✓ Large-scale plant resets have been completed Significant Progress ✓ Currently achieving significant improvements in quality control, production, packaging and release Across Network attainment ✓ January to April production volumes were ~50% o
Slide 12: Consumerizing, Simplifying and Scaling One Perrigo
Consumerizing, Simplifying and Scaling One Perrigo Deliver and De-lever 2024 - 2025 • Business remains strong • Remain on track to deliver accretive initiatives • Margin expansion expected to continue • Making significant progress in infant formula • Driving performance in U.S. store brand • Remain
Slide 13: Eduardo Bezerra
Eduardo Bezerra «ve «cro Perrigo
Slide 14: Q2'24 Non-GAAP Adjustments
Q2’24 Non-GAAP Adjustments 14
Slide 15: Q2'24 YoY – Known Infant Formula Impact & Lower Seasonal Demand
Q2’24 YoY – Known Infant Formula Impact & Lower Seasonal Demand, Partially Offset by Strength in Rest of Business Second Quarter Results YTD Results Constant Constant Organic net sales growth of -8.1%: Perrigo Q2 2024 $ Change % Change YoY YoY Currency % % Change YoY Currency % • -5.3ppts from infan
Slide 16: Net Sales YoY – Segment Highlights
Net Sales YoY – Segment Highlights Organic Growth +1.0% $442M +4.5ppts $431M CSCI -3.5ppts Q2 2024 Net Sales YoY $751M Organic Growth -15.1% CSCA -10.8ppts +0.1ppts $634M Q2 2024 -4.4ppts Net Sales YoY 16 1. See attached Appendix for reconciliation of Adjusted (Non-GAAP) to Reported (GAAP) amounts.
Slide 17: Adj. Margins YoY – Adj. Gross and Operating Margin Expansion Continued
Adj. Margins YoY – Adj. Gross and Operating Margin Expansion Continued; On Track to Deliver FY’25 Margin Outlook Perrigo Quarterly Adj. Gross & Operating Margin 42.0% Q2’24 adj. 40.6% gross margin 19.0% 40.0% +190bps YoY 38.7% 17.0% 38.0% 36.5% 15.0%Q2’24 adj. 13.1% operating margin 36.0% +160bps Yo
Slide 18: Adj. EPS YoY – Known Infant Formula Impact and Prior Year Tax Benefit
Adj. EPS YoY – Known Infant Formula Impact and Prior Year Tax Benefit More Than Offset Growth in Rest of Business $0.63 $0.53 Q2 2024 Includes -$0.04 impact from Adj. EPS YoY exited products & unfavorable foreign currency translation 18 1. See attached Appendix for reconciliation of Adjusted (Non-GA
Slide 19: On Track to Pay Down $400M in Debt by Year End and Reduce Net Leverage
On Track to Pay Down $400M in Debt by Year End and Reduce Net Leverage Projected 2024 Sources & Uses of Cash $500M - $600M $650M - $750M $543M $500M - $550M Net Includes $205M Expected Cash Est. Net from sale of Leverage HRA Pharma Conversion of Leverage 5.1x 90% - 100% ~3.8x - ~4.0x Rare Diseases 1
Slide 20: Reaffirm Adj. EPS Outlook Range
Reaffirm Adj. EPS Outlook Range Previous Outlook Current Outlook Metric Comments vs. Prior Year Comments vs. Prior Outlook 5/7/24 8/2/24 + New products • -2.5ppts impact from 2Q’24 net sales + Margin recovery pricing actions results Organic Net + Absence of HRA distributor transitions • Lower global
Slide 21: Main Drivers of 2H'24 Adj. EPS Uplift Compared to 1H'24
Main Drivers of 2H’24 Adj. EPS Uplift Compared to 1H’24 Adj. EPS Walk 1H’24 to 2H’24 $1.75 (midpoint of 2H’24 outlook range) $0.83 1. Outlook based on U.S. dollar/euro exchange rate of $1.09/€1.00 as of 7/22/24. 21 2. See attached Appendix for reconciliation of Adjusted (Non-GAAP) to Reported (GAAP)
Slide 22: Make Lives Better Through Trusted Health and Wellness Solutions – Q&A
Make Lives Better Through Trusted Health and Wellness Solutions, Accessible to All Q&A
Slide 23: Table I: Reconciliation of Non-GAAP Measures
TABLE I PERRIGO COMPANY PLC RECONCILIATION OF NON-GAAP MEASURES (in millions, except per share amounts) (unaudited) 23
Slide 24: Table I (Continued): Reconciliation of Non-GAAP Measures
TABLE I (Continued) PERRIGO COMPANY PLC RECONCILIATION OF NON-GAAP MEASURES (in millions, except per share amounts) (unaudited) 24
Slide 25: Table II: Reconciliation of Non-GAAP Measures
TABLE II PERRIGO COMPANY PLC RECONCILIATION OF NON-GAAP MEASURES (in millions, except per share amounts) (unaudited) 25
Slide 26: Table II (Continued): Reconciliation of Non-GAAP Measures
TABLE II (Continued) PERRIGO COMPANY PLC RECONCILIATION OF NON-GAAP MEASURES (in millions, except per share amounts) (unaudited) 26
Slide 27: Table III: Reconciliation of Non-GAAP Measures
TABLE III PERRIGO COMPANY PLC RECONCILIATION OF NON-GAAP MEASURES (in millions, except per share amounts) (unaudited) 27
Slide 28: Table III (Continued): Reconciliation of Non-GAAP Measures
TABLE III (Continued) PERRIGO COMPANY PLC RECONCILIATION OF NON-GAAP MEASURES (in millions, except per share amounts) (unaudited) 28
Slide 29: Table IV: Reconciliation of Non-GAAP Measures
TABLE IV PERRIGO COMPANY PLC RECONCILIATION OF NON-GAAP MEASURES (in millions, except per share amounts) (unaudited) 29
Slide 30: Table IV (Continued): Reconciliation of Non-GAAP Measures
TABLE IV (Continued) PERRIGO COMPANY PLC RECONCILIATION OF NON-GAAP MEASURES (in millions, except per share amounts) (unaudited) 30
Slide 31: Table V: Reconciliation of Non-GAAP Measures
TABLE V PERRIGO COMPANY PLC RECONCILIATION OF NON-GAAP MEASURES (in millions, except per share amounts) (unaudited) 31
Slide 32: Table VI: Reconciliation of Non-GAAP Measures
TABLE VI PERRIGO COMPANY PLC RECONCILIATION OF NON-GAAP MEASURES (in millions, except per share amounts) (unaudited) 32
Slide 33: Table VII: Reconciliation of Non-GAAP Measures
TABLE VII PERRIGO COMPANY PLC RECONCILIATION OF NON-GAAP MEASURES (in millions, except per share amounts) (unaudited) 33
Slide 34: Table VIII: Reconciliation of Non-GAAP Measures
TABLE VIII PERRIGO COMPANY PLC RECONCILIATION OF NON-GAAP MEASURES (in millions, except per share amounts) (unaudited) 34
Slide 35: Table IX: Reconciliation of Non-GAAP Measures
TABLE IX PERRIGO COMPANY PLC RECONCILIATION OF NON-GAAP MEASURES (in millions, except per share amounts) (unaudited) 35