Oppenheimer Consumer Growth & E-Commerce Conference - June 15, 2022 - Adding HR photos
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Oppenheimer Consumer
Growth & E-Commerce
Conference
June 15, 2022
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 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: the effect of the coronavirus (COVID-19) pandemic and its variants and associated supply chain impacts on the Company’s
business; 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;
future impairment charges; 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, including the Company’s
appeal of the draft and final Notices of Proposed Assessment (“NOPAs”) issued by the U.S. Internal Revenue Service and the impact that an adverse result in any such proceedings
would have on operating results, cash flows, and liquidity; pending and potential third-party claims and litigation, including litigation relating to the Company’s restatement of
previously-filed financial information, and litigation relating to uncertain tax positions, including the NOPAs; potential impacts of ongoing or future government investigations and
regulatory initiatives; uncertainty regarding anticipated regulatory approvals; potential costs and reputational impact of product recalls or sales halts; the impact of tax reform
legislation and/or changes in healthcare policy; the timing, amount and cost of any share repurchases; fluctuations in currency exchange rates and interest rates; the Company’s
ability to achieve the benefits expected from the sale of its Rx business and the risk that potential costs or liabilities incurred or retained in connection with the 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 acquisition of HRA
Pharma and 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
acquisition; risks associated with the integration of HRA Pharma, 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 strategic and other initiatives, including the Company's ability to achieve
the expected benefits from its supply chain reinvention program. An adverse result with respect to the Company’s appeal of any material outstanding tax assessments or pending
litigation, including securities or drug pricing matters, could ultimately require the use of corporate assets to pay such assessments, damages from third-party claims, and related
interest and/or penalties, and any such use of corporate assets would limit the assets available for other corporate purposes. There can be no assurance that the FDA will approve
the sale of daily oral contraceptives without a prescription in the United States. These and other important factors, including those discussed under “Risk Factors” in the Company’s
Form 10-K for the year ended December 31, 2021, 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 presentation
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 presentation contains Non-GAAP measures. The reconciliation of those measures to the most comparable GAAP measures are included at the end of
this presentation.
2
Transformation Complete; Now Focused on ‘Optimizing
Perrigo’ and ‘Accelerating Profitable Growth’
From …To Optimization
Transformation… & Acceleration
Final 3 Major Strategic
Strategic Priorities For 2022/23
Milestones Achieved in 2021
1 Closed Rx Divestiture for $1.6B 1 HRA Integration
Announced €1.8B Acquisition
2 of HRA Pharma
2 Supply Chain Reinvention
Resolved €1.6B Irish Tax
3 Assessment for €266M in Cash
3 Gross Margin Recapture
3
Core Businesses Delivering Strong Organic Sales Growth
Momentum
Quarterly Growth YoY
(ex-currency) Q1 Net Sales 3-
+9.7% Year Stack
+5.7%
+3.1%
+5.6%
(ex-currency)
-0.3%
CSCA +4.0%
(organic 1)
CSCI
3-Year CAGR
(Q1’19:Q1’22)
Total -9.0%
Q1:21 Q2:21 Q3:21 Q4:21 Q1:22
4 1. See attached Appendix for reconciliation of Adjusted (Non-GAAP) to Reported (GAAP) amounts.
HRA Pharma Deal Closed And Will Accelerate Perrigo Growth
HRA FY21 Select Financial Results Final Purchase Price
(Per Perrigo 8-K 1 )
€257M
Net Sales
+26% Growth YoY €1.8B or $1.9B
Gross
Margin ~72%
Operating
Income 2 €56M
1. Source: Perrigo 8-K issued on March 28, 2022; Pro-forma results.
5 2. Source: Perrigo 8-K issued on March 28, 2022; Pro-forma results; adjusted operating income translated to euros using average euro/U.S. dollar spot exchange rate of $1.1829/€1.00 per the 8-K.
HRA is A Star Performer With Marquis Brands
BLISTER CARE WOMEN’S HEALTH SCAR CARE
Acquisition Closed
Two Months Ahead of
Schedule
• Integration teams making
Growth Drivers • New adjacencies • Continued geographic • Brand refresh in U.S.
significant progress including cuts, burns, expansion in Europe
already spots • Expansion from scar, to
• Potential approval of broader dermatological
• Continued geographic OTC daily oral applications
contraceptive in U.S
• Remain confident in expansion; U.S. launch
outlook presented at time Market Share*
of acquisition >70% >50% >50%
announcement (in EU) (in EU) (in U.S.)
• HRA senior leadership to
remain with company for Market Position*
#1 in foot care on HRA is the undisputed #1 Doctor &
minimum of 1-year blister treatments and category leader in Pharmacist
#2 in cold sore in emergency contraception recommended brand in
Europe in Europe the U.S.
6 * Source: HRA
HRA On-track to Deliver 2022-2023 Accretion Expectations
Perrigo Expects €55M-€65M in Adj. Operating
Income from 8 Months of HRA Accretion in 2022
~€90M
2023-24 Key Assumptions:
• Strong topline growth
€56M1 continues
• Achieve >€40M in cost
synergies
• Costs to capture
synergies can be offset
Expected 2022 Accretion to Perrigo
7 1. Source: Perrigo 8-K issued on March 28, 2022; Pro-forma results; adjusted operating income translated to euros using average euro/U.S. dollar spot exchange rate of $1.1829/€1.00 per the 8-K.
Off To A Strong Start - Rapid Growth Continued in Q1:22
HRA Q1:22 Net Sales Growth YoY1
+27%
8 1. Source: Q1 HRA internal unaudited results; prior to acquisition closing on 4/29/22.
Total Perrigo Adj. Gross Margins Forecasted to Recover 400-
500 Basis Points In Second Half 2022
Q4:21 Adj. Gross Q1:22 Adj. Gross 2H:22 Adj. Gross
Margin: 34.8% Margin: 33.4% Margin (Est.): 37-39%
Projecting 400-500 bps
Recovery Driven By:
Margins Impacted by Higher Inflation Driven
Supply Chain Input Costs, Offset by • CSCA Mfg Productivity
Disruption & Higher Pricing Actions, in • Elimination of COVID
Input Costs addition to one-time Costs
costs experienced in
• Price Increases
Q1
• Sale of Latin America
Businesses
• HRA Margin Accretion
9 1. See attached Appendix for reconciliation of Adjusted (Non-GAAP) to Reported (GAAP) amounts.
Organic Growth Supported By Pandemic Affected Products
Rebound & Strong Innovation
TOTAL PERRIGO COUGH/COLD INNOVATIVE NEW PRODUCT
NET SALES INTRODUCTIONS
+83%
Q1'21 Q1'22
10Perrigo’s Responsible Role In Helping To Solve Infant Formula
Crisis Also Benefiting Results
• Perrigo facilities running 24/7
Picture of Presidential Round Table
• Shipped 37% more formula vs the same
period last year (three months ending
3/31/2022)
• Prioritized production of formulas and
sizes
• Optimized portfolio allowed for increased
production output by 15% above full
capacity
• Will continue down this path until crisis is
resolved
11Perrigo Forecasting Strong 2022 Growth In A Difficult Macro
Environment
PERRIGO FY22 GUIDANCE 1
Net Sales +8.5% to +9.5%
Organic Net
Sales +8.0% to +9.0%
Adjusted EPS +12% to +17%
12 1. Guidance as of May 11, 2022PERRIGO – A COMPELLING INVESTMENT! • Perrigo Consumer Transformation Complete – Now Focused On Optimization & Acceleration • HRA Acquisition Substantially Accretive To Revenue Growth, Margins & Earnings Growth • Adj. Gross Margins Expected to Recover 400-500 Basis Points in 2H • Strong Organic Growth Expected To Continue Behind Rebound In Pandemic Impacted Businesses and Core Products Innovation • Guiding To Double Digit Top & Bottom-Line Growth In A Difficult Macro-Economic Environment
To make lives better by bringing Quality, Affordable Self-Care Products that consumers trust everywhere they are sold
TABLE I
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
ADJUSTED NET SALES GROWTH
(in millions)
(unaudited)
Three Months Ended
April 2, March 30,
2022 2019 CAGR 2019 - 2022
CSCA reported net sales $ 710.0 $ 581.8
CSCI reported net sales $ 364.5 $ 351.3
Consolidated reported net sales $ 1,074.5 $ 933.1 4.8 %
Less: Currency 24.4
Net sales less currency $ 1,098.9 $ 933.1 5.6 %
Less: Acquisition of European dermatology brands (5.6)
Less: Oral care (90.6)
Less: Animal Health (19.6)
Less: Rosemont Pharmaceuticals business (13.1)
Less: Infant foods (5.3)
Less: Canoderm prescription product (3.7)
Organic net sales less currency $ 1,002.7 $ 891.4 4.0 %
15TABLE II
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
SELECT NET SALES RESULTS
(in millions)
(unaudited)
Three Months Ended
April 3, March 28, Total FX Constant
2021 2020 Change Change Currency Change
Reported Net sales
$ 1,010.0 $ 1,083.3 (6.8)% (2.2)% (9.0)%
Consolidated Continuing Operations
Three Months Ended
July 3, June 27, Total FX Constant
2021 2020 Change Change Currency Change
Reported Net sales
Consolidated Continuing Operations $ 981.1 $ 948.8 3.4% (3.7)% (0.3)%
Three Months Ended
October 2, September 26, Total FX Constant
2021 2020 Change Change Currency Change
Reported Net sales
Consolidated Continuing Operations $ 1,042.7 $ 1,003.0 4.0% (0.9)% 3.1%
Three Months Ended
December 31, December 31, Total FX Constant
2021 2020 Change Change Currency Change
Reported Net sales
$ 1,104.9 $ 1,053.2 4.9% 0.8% 5.7%
Consolidated Continuing Operations
Three Months Ended
April 2, April 3, Total FX Constant
2022 2021 Change Change Currency Change
Reported Net sales
Consolidated Continuing Operations $ 1,074.5 $ 1,010.0 6.4% 3.3% 9.7%
16TABLE III
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
SELECT GROSS MARGIN RESULTS
(in millions)
(unaudited)
Three Months Ended
April 2, December 31, Total
2022 2021 Change
Adjusted gross margin
Consolidated Continuing Operations 33.4 % 34.8 % (140) bps
Three Months Ended April 2, 2022 Three Months Ended December 31, 2021
Net Gross Net Gross
Consolidated Continuing Operations Sales Profit Consolidated Continuing Operations Sales Profit
Reported $ 1,074.5 $ 337.8 Reported $ 1,104.9 $ 362.3
As a % of reported net sales 31.4% As a % of reported net sales 32.8 %
Pre-tax adjustments1 Pre-tax adjustments1
Amortization expense related primarily to acquired intangible assets $ 21.5 Amortization expense related primarily to acquired intangible assets $ — $ 22.8
Adjusted $ 359.3 Adjusted $ 1,104.9 $ 385.1
As a % of reported net sales 33.4% As a % of reported net sales 34.8 %
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.
17TABLE IV
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
HERA SAS SELECTED INFORMATION
(in millions)
(unaudited)
Hera SAS Adjusted Historical Twelve Months Ended
Statement of Profit and Loss (Unaudited) December 31, 2021
Operating Income 1
$ 58.6
Operating Income 2
€ 49.5
Amortization expense
4.8
Restructuring charges
1.2
Adjusted operating income
€ 55.5
1. Source: Perrigo 8-K issued on March 28, 2022; Pro-forma results.
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2. Source: Perrigo 8-K issued on March 28, 2022; Pro-forma results; translated to euros using average euro/U.S. dollar spot exchange rate of $1.1829/€1.00 per the 8-K.You can also read
