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Perrigo Q1 Net Sales Increase 14.2%

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OTC & health and wellness private brand manufacturer Perrigo today announced financial results for the first quarter ended March 28, 2020.

President and CEO Murray S. Kessler commented, \”During these unprecedented times, I am honored to be surrounded by our more than 11,000 dedicated employees who are making tremendous sacrifices to help ensure that our essential products remain available to consumers and patients who need them. Our top priorities remain our employees\’ well-being and business continuity, while at the same time supporting the communities where we live and work.\”

Kessler continued, \”Thanks to these courageous employees, we were able to report another quarter of strong growth across all business segments with robust sales and profitability above expectations. While we started the year off with similarly strong trends that we experienced in the fourth quarter of 2019, our business surged significantly in March in response to the global demand created by the COVID-19 pandemic. Worth noting, not only did our team keep the business running, they also made significant further progress on our Consumer Self-Care transformation. Perrigo is clearly well-positioned for a \’New-Normal\’ future, which will need Quality, Affordable Self-Care Products more than ever before.\”

First Quarter Financial Highlights

  • Consolidated first-quarter net sales were $1.3 billion, an increase of 14.2% compared to the prior-year quarter. Excluding exited businesses and the impact of currency, net sales increased by 17.6%.
  • Worldwide Consumer first-quarter net sales increased by 16.2% compared to the prior-year quarter. Excluding exited businesses and the impact of currency, Worldwide Consumer net sales were 20.7% higher year-over-year.
  • Consumer Self-Care Americas (CSCA) achieved record first-quarter net sales of $701 million, or growth of 20.4% versus the prior-year quarter highlighted by 15.0% organic growth; Consumer Self-Care International (\”CSCI\”) first-quarter net sales grew 9.1% versus the prior-year quarter highlighted by 8.1% organic growth.
  • Reported diluted EPS for the first quarter of 2020 was $0.77 per diluted share as compared to EPS of $0.47 in the prior-year quarter.
  • Adjusted diluted EPS for the first quarter of 2020 increased by 6.5% to $1.14 as compared to $1.07 per diluted share in the prior-year quarter.
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Perrigo Donates 500,000 Bottles of Hand Sanitizer

Private brand over-the-counter health and wellness manufacturer Perrigo announced today that over the next few months, the company will donate at least 500,000 bottles of hand sanitizer to local hospitals and first responders facing urgent shortages of this essential product.

Once Perrigo learned about the shortage, the manufacturer’s team quickly mobilized to formulate, produce and ship hand sanitizer within only a few weeks’ time. Perrigo is manufacturing the hand sanitizer at its New York facility and the product is being delivered to hospitals and healthcare providers in West Michigan, including Allegan General Hospital and Spectrum Health Hospitals, and the greater New York City area (New York/New Jersey/Connecticut) through the ‘Mayor’s Fund to Advance New York City,’ which determines the agencies most in need of the product. The Michigan State Police will also receive hand sanitizer donations to aid first responders in their work with the general public.

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Perrigo President and
CEO Murray S. Kessler

Perrigo President and CEO Murray S. Kessler says, “As a leading global provider of self-care products, we have a special responsibility to do everything in our power to assist those in need. Given our close ties in the communities where we work and live, we were made aware of the shortage and critical need for hand sanitizers in local area hospitals. Our team in New York sprang into action and were able to develop a formula, get it into production and ready initial shipments to hospitals within an extraordinarily compressed timeframe. I am extremely proud of our front-line manufacturing employees, who have been working around the clock to support consumers, patients, and hospitals at this imperative time.”

Additional batches of hand sanitizer will also be provided to Perrigo essential employees in the U.S.

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Perrigo Assures Availability of Store Brand Formula (COVID-19)

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In this challenging time Perrigo Nutrition has issued an official statement reassuring shoppers that Private Brand infant formula has no current or pending disruptions to the supply chain

A Message from Perrigo Nutrition Regarding the Coronavirus (COVID-19)

Perrigo cares about the health and safety of families, employees, retail partners, and suppliers. You are a top priority for us, especially as the COVID-19 global health crisis and national emergency evolves. We are closely monitoring developments, and we want to assure parents and caregivers that we are doing everything we can to produce and distribute safe infant formula products for babies at trusted stores and online outlets across the country.

Perrigo manufactures all store brand infant formula in the United States. We are not presently aware of any current or pending disruptions to our supply of formula because of this situation. We are aware that some individual stores have experienced periodic shortages of infant formula. We are working with our retail partners—including Walmart, Target, Sam\’s Club, Costco, Kroger, Aldi, Amazon.com, and others—to replenish shelves as quickly as possible.

As the world continues to work through this health crisis, we wanted to share some important information.

  • Perrigo continues to ship infant formula to stores nationwide. If one store is out of formula, try another store or buy online.
  • All commercial infant formulas—name brands and store brands—provide complete nutrition. For most infants, switching from one type of formula (e.g., milk-based) to the same type of formula from a different brand is well tolerated. When considering which store brand formula to try, look for the \”compare to\” statement on the label.
  • Store brand infant formulas are safe. They are manufactured in FDA-inspected facilities in Vermont and Ohio, using dairy ingredients from the United States, Canada, and New Zealand.
  • Do not attempt to make your own formula. Homemade infant formula is dangerous and not recommended by the FDA or the American Academy of Pediatrics.
  • Do not dilute or stretch infant formula by adding extra water. It is important to follow the manufacturer\’s label instructions to make certain your baby gets what he or she needs to thrive.

If you have questions about feeding your infant, contact your pediatrician.

Perrigo is committed to helping parents and caregivers feed their babies. That\’s why we\’re working with our retail partners to ensure product availability everywhere store brands are sold.

We also realize there are rumors circulating on the web that claim companies are giving away free cases of infant formula. Perrigo is not giving away formula—we are working to make certain store brand infant formula is available for all babies in an equitable fashion in the stores where parents and caregivers buy their formula.

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Perrigo to Buy High Ridge Brands Oral Care

This week High Ridge Brands Co. announced that following a comprehensive sales process and a competitive auction conducted under Section 363 of the U.S. Bankruptcy Code, an affiliate of Perrigo Company plc will acquire the Company\’s oral care business and an affiliate of Tengram Capital Partners will acquire the Company\’s hair care and skin cleansing business.

Under the terms of the agreement, the consideration includes a cash payment to High Ridge Brands of $120.5 million and the assumption by the buyers of working capital and substantially all go-forward liabilities of the businesses, as well as certain cure costs associated with the Company\’s existing business arrangements.

\”We are pleased to conclude a successful and competitive auction process,\” said Patricia Lopez, High Ridge Brands\’ Chief Executive Officer and President. \”This outcome maximizes the value of our strong brands and supports the interests of all of our stakeholders. The buyers bring significant resources and experience and have long track records helping acquired brands build on their strong foundations and continue to grow. The transaction will be seamless for both our customers and consumers. As we finalize the sale, we remain focused on continuing the on-time, in-full deliveries of all our hair care, skin cleansing and oral product lines.\” 

At closing, High Ridge Brands and the buyers will enter into a mutual Transition Services Agreement (TSA) in order to provide for a seamless transfer of the oral, skin and hair businesses. The TSA is expected to span at least 12 months.

The transaction is subject to approval by the U.S. Bankruptcy Court for the District of Delaware and certain other closing conditions. A hearing to seek court approval for the transaction is scheduled for Wednesday, February 26, 2020. The transaction is expected to close in the first quarter of 2020.

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Perrigo Announces Leadership Transition

Late last week Perrigo announced the future retirement of Jeff Needham, Executive Vice President and President, Consumer Self-Care Americas (CSCA). Rich Sorota, currently Chief Executive Officer and President of Ranir, will be appointed Executive Vice President and President, Consumer Self-Care Americas, on March 23, 2020, at which point Mr. Needham will step down from his current role and serve in an advisory role until his retirement on September 30, 2020.

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Jeff Needham, EVP and President, Consumer Self-Care Americas, Perrigo

Mr. Needham has had a remarkable career since joining Perrigo in 1984, including leadership roles in marketing, business development, and Perrigo\’s international businesses. In addition to building Perrigo\’s highly successful CSCA business, Mr. Needham has become a highly trusted industry advisor.

\”I am extremely proud and grateful to have had the privilege to be part of the Perrigo team for so many years as we have partnered with our retail and wholesale customers to grow the store brand business to where it is today,\” commented Mr. Needham. \”Perrigo is a great company with a business that brings tremendous value to consumers through our strong customer partnerships. I am confident that Perrigo\’s growth trajectory and the ongoing development of our CSCA business will be well served by Rich\’s leadership.\”

Perrigo President and Chief Executive Officer Murray S. Kessler said, \”I want to express my deep appreciation of Jeff and all that he has accomplished over his storied 36-year tenure with Perrigo. His leadership and dedication are intertwined with the history and success of Perrigo in addition to that of the store brand health and wellness industry. We greatly value Jeff\’s significant contributions to Perrigo and the self-care industry and wish him well in his retirement.\”

Kessler continued, \”Following Perrigo\’s acquisition of Ranir, it became apparent that Rich is an exceptional leader with the skills and experience to execute on Perrigo\’s vision and strategy. I look forward to working with him on expanding our \’national brand better\’ offerings through innovation, executing against our self-care strategy, and driving profitable growth.\”

Mr. Sorota has served as CEO and President of Ranir since July 2015. Mr. Sorota has a long history of experience in sales, marketing, and product development. While at BISSELL Inc., Rich served as Senior Vice President and General Manager for Global Sales and Marketing and then Executive Vice President of Global Commercial Operations. Previous roles included serving as President for HARMAN International, Senior Vice President and General Manager at The Scotts Miracle-Gro Company, and senior leadership roles in marketing and innovation for Philips Electronics and brand management at Procter & Gamble.

\”I am honored for the opportunity to lead such a great business,\” said Mr. Sorota. \”As I have come to know Perrigo better following the acquisition of Ranir, I am even more excited about the long-term outlook for the company and its consumer self-care strategy. I look forward to working closely with the highly talented CSCA team to foster new innovation and drive profitable growth in this business.\”