The following is a summary of the Perrigo Company Plc (PRGO) Q1 2024 Earnings Call Transcript:
Financial Performance:
Perrigo experienced a decline in Q1 EPS due to a stressful period with their infant formula resulting in a drop of $0.30 compared to the previous year.
Net sales also saw a decline of over 8% due to challenges presented by infant formula strategies and SKU prioritization actions, elements of their much larger supply chain reinvention program.
Gross margin suffered a slight decrease by 90 basis points to 36.5%.
Business Progress:
Perrigo is working hard to strengthen their infant formula business, anticipating a recovery of manufacturing volumes in H2.
The US launch of Opill, their oral contraceptive, has shown promise with quick consumer conversions.
The company has planned cost savings of $25 million in incremental HRA synergies, $12 million from their supply chain reinvention, and $17 million from Project Energize.
A leadership change is expected in August as Svend Andersen, President of CSCI, will retire and Roberto Khoury will take his place.
The infant formula recovery process is showing positive results, with production and facility throughput outperforming expectations.
Continued success with Opill is seen through expanded insurance coverage which is predicted to be advantageous.
Growth in the skincare sector, driven largely by Compeed and its extensions, has been noticed, and plans are underway to focus more in these profitable categories.
More details: Perrigo IR
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