Core Viewpoint - Perrigo has initiated a strategic review of its infant formula business, indicating a shift in focus towards higher-margin branded products [1] Company Summary - The consumer health company, Perrigo, is reassessing its infant formula segment as part of a broader strategy to enhance profitability through branded offerings [1]

Core Insights - Perrigo reported $1.04 billion in revenue for the quarter ended September 2025, reflecting a year-over-year decline of 4.1% and an EPS of $0.80, slightly down from $0.81 a year ago [1] - The revenue fell short of the Zacks Consensus Estimate of $1.1 billion, resulting in a surprise of -4.84%, while the EPS exceeded expectations by 6.67% against a consensus estimate of $0.75 [1] Financial Performance Metrics - Net Sales for Consumer Self-Care International (CSCI) were $398 million, below the average estimate of $432.27 million, marking a year-over-year decline of 4.4% [4] - Net Sales for Consumer Self-Care Americas (CSCA) reached $646 million, compared to the estimated $664.1 million, representing a decrease of 3.8% year-over-year [4] - Adjusted Gross Profit for CSCI was reported at $199 million, falling short of the estimated $228.07 million [4] - Adjusted Gross Profit for CSCA was $218 million, slightly above the average estimate of $217.28 million [4] Stock Performance - Perrigo's shares have returned -6.9% over the past month, contrasting with a +1% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Financial Data and Key Metrics Changes - For Q3 2025, organic net sales declined by 4.4%, impacted by a 1.6% decline from the global OTC business and a 2.8% decline from businesses under review [11][12] - Year-to-date, organic net sales decreased by 1.7%, primarily driven by a 0.8% impact from businesses under review and a 0.5% impact from the absence of last year's Opill launch stocking benefits [12][24] - Q3 EPS was $0.80, down one cent from the prior year, while year-to-date EPS grew 21% to $1.97 [11][21] Business Line Data and Key Metrics Changes - In the US OTC market, Perrigo gained volume share of 90 basis points across nearly every category, particularly in smoking cessation, allergy, and women's health [6][13] - The CSCI segment saw a 5.3% decline in organic net sales for Q3, primarily due to soft OTC category consumption trends, while year-to-date organic net sales grew by 0.7% [19][20] - The infant formula business experienced a 3.8% decline in Q3, with share recovery taking longer than expected [14][20] Market Data and Key Metrics Changes - US OTC volume consumption declined by 3.2%, while European OTC grew by only 0.6%, falling short of original assumptions [13][24] - The overall market consumption trends have been softer than anticipated, impacting Perrigo's net sales outlook by an estimated $150-$170 million [13][24] Company Strategy and Development Direction - The company is focused on its 3S plan: stabilize, streamline, and strengthen, which has guided its actions and priorities [8][16] - A strategic review of the infant formula business is underway, with the aim to optimize its long-term role within the Perrigo portfolio [14][47] - The sale of the dermocosmetics business is on track to close in Q1 2026, with proceeds aimed at reducing leverage [23][47] Management's Comments on Operating Environment and Future Outlook - Management noted that the current consumption trends are dynamic and unpredictable, with expectations for stabilization in 2026 [41][46] - The company remains committed to deleveraging and sustaining dividends while focusing on high-potential OTC portfolio growth [15][47] - Management expressed confidence in Perrigo's ability to capture durable demand for consumer health solutions despite current challenges [17][46] Other Important Information - The company has achieved $163 million in gross annual savings from Project Energize, exceeding initial expectations [9][18] - Operating cash flow for Q3 was $52 million, with year-to-date cash flow at $63 million [22][23] Q&A Session Summary Question: Follow-up on infant formula share and expectations - Management acknowledged that while store brand share is growing, it is at a slower pace than anticipated due to competitive pressures and market dynamics [28][29] Question: Insights on OTC and infant formula consumption changes - Management noted that OTC consumption has been volatile, with a significant decline observed in Q3 compared to previous quarters [33][34] Question: Plans for reinvestment given current market conditions - Management indicated that while priorities remain on deleveraging and maintaining dividends, there may be opportunities to increase spending in high-performing areas [38][39] Question: Current share of infant formula and future growth expectations - Management reported an approximate 16% share in infant formula, with expectations to grow to 18-20% over the next 12 months [40][41] Question: Clarification on gross margin pressure - Management confirmed that the gross margin pressure was primarily due to sales deleverage and product mix, not input costs [42][43]

Core Insights - Perrigo (PRGO) reported quarterly earnings of $0.8 per share, exceeding the Zacks Consensus Estimate of $0.75 per share, but down from $0.81 per share a year ago, indicating an earnings surprise of +6.67% [1] - The company posted revenues of $1.04 billion for the quarter ended September 2025, missing the Zacks Consensus Estimate by 4.84% and down from $1.09 billion year-over-year [2] - Perrigo has surpassed consensus EPS estimates three times over the last four quarters but has not beaten revenue estimates during the same period [2] Earnings Outlook - The sustainability of Perrigo's stock price movement will largely depend on management's commentary during the earnings call and future earnings expectations [3][4] - The current consensus EPS estimate for the upcoming quarter is $1.02 on revenues of $1.17 billion, and for the current fiscal year, it is $2.94 on revenues of $4.37 billion [7] Industry Context - The Medical - Products industry, to which Perrigo belongs, is currently in the bottom 40% of over 250 Zacks industries, which may negatively impact stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that investors should monitor these revisions closely [5] Stock Performance - Perrigo shares have declined approximately 21.5% since the beginning of the year, contrasting with the S&P 500's gain of 15.1% [3] - The estimate revisions trend for Perrigo was unfavorable ahead of the earnings release, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6]

Bradley Joseph Q3 2025 Earnings Presentation Nov 5, 2025 VP Global Investor Relations Forward-Looking Statements Certain statements in this presentation are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, and are subject to the safe harbor created thereby. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our, or our industry's ac ...

Core Insights - The company reported a net sales of $1.04 billion for Q3 2025, a decrease of 4.1% year-over-year, primarily due to organic net sales decline and the impact of divestitures and exited products [7][13][20] - Despite challenges in the marketplace, the company achieved year-to-date EPS growth and margin expansion, indicating resilience in its operations [1][9] - A strategic review of the infant formula business has been initiated, alongside ongoing reviews of the oral care business, while the sale of the dermacosmetics business is on track for Q1 2026 [1][9] Year-to-Date Performance - Year-to-date net sales reached $3.14 billion, down 2.8% year-over-year, with organic net sales declining by 1.7% [7][29] - Adjusted EPS for the year is projected to be between $2.70 and $2.80, reflecting a growth of 5% to 9% year-over-year [38] Segment Highlights Consumer Self-Care Americas (CSCA) - CSCA net sales were $646 million, down 3.8%, with organic net sales also declining by 3.1% [21][22] - The segment experienced growth in the U.S. OTC business, driven by share gains in five of seven categories, despite overall soft market consumption [22][23] Consumer Self-Care International (CSCI) - CSCI net sales decreased by 4.5% to $398 million, with organic net sales down 5.3% [27][29] - The decline was attributed to soft total OTC category consumption and challenges in specific product categories, despite some share gains in key brands [29][30] Financial Metrics - Reported operating income for Q3 was $73 million, compared to $80 million in the prior year, with adjusted operating income at $173 million, down 4.9% [7][18] - The company reported a diluted EPS of $0.09, an improvement from a loss of $(0.13) in the prior year [20][24] Strategic Initiatives - The company is implementing Project Energize, aimed at enhancing operational efficiency and is expected to yield annualized pre-tax savings of $140 million to $170 million by the end of 2026 [11] - The strategic reviews and divestitures are part of a broader effort to streamline operations and focus on core business areas [1][9]

Core Viewpoint - Perrigo Company plc is initiating a strategic review of its infant formula business to assess various alternatives and align with its 'Three-S' plan, focusing on disciplined capital allocation and improving returns [1][2][4] Business Overview - The infant formula business is projected to generate net sales of approximately $360 million in 2025, representing about 90% of Perrigo's global Nutrition category and less than 10% of the company's total annual net sales [3] - The operations have stabilized, producing quality assured formula, and Perrigo remains the only large-scale U.S. store brand and contract manufacturer with a significant near-term innovation pipeline [3] Strategic Intent - The review aims to accelerate cash flows and reassess a previously announced investment of $240 million in the infant formula business while optimizing portfolio impact [2] - The CEO emphasized the need for discipline in positioning the company's portfolio for sustainable growth and free cash flow generation, noting that the external environment has changed, affecting the strategic fit with consumer health OTC businesses [4]

Core Insights - Perrigo Company plc is scheduled to participate in one-on-one investor meetings at the Jefferies Miami Consumer Conference on November 18, 2025, with President and CEO Patrick Lockwood-Taylor and CFO Eduardo Bezerra attending [1] Company Overview - Perrigo is a leading pure-play consumer health company with over a century of experience in providing high-quality health and wellness solutions primarily in North America and Europe [2] - The company is a pioneer in the over-the-counter (OTC) self-care market, offering trusted self-care solutions that do not require a prescription, ensuring accessibility and choice for consumers [2] Business Model - Perrigo's unique business model leverages complementary businesses, where cash-generative store brand private label offerings fuel investments for leading brands such as Opill, Mederma, Compeed, EllaOne, and Jungle Formula [3]

Core Viewpoint - Wall Street anticipates a year-over-year decline in earnings for Perrigo despite higher revenues, with a focus on how actual results compare to estimates impacting stock price [1][2]. Earnings Expectations - Perrigo is expected to report quarterly earnings of $0.75 per share, reflecting a year-over-year decrease of 7.4%, while revenues are projected to be $1.1 billion, an increase of 0.8% from the previous year [3]. Estimate Revisions - The consensus EPS estimate has been revised down by 1.92% over the last 30 days, indicating a reassessment by analysts regarding the company's earnings prospects [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that the Most Accurate Estimate for Perrigo is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -1.33%, suggesting bearish sentiment among analysts [12]. Historical Performance - In the last reported quarter, Perrigo was expected to earn $0.59 per share but only achieved $0.57, resulting in a surprise of -3.39%. Over the last four quarters, the company has beaten consensus EPS estimates twice [13][14]. Investment Considerations - Despite the negative Earnings ESP and Zacks Rank of 4, which complicates predictions for an earnings beat, investors are advised to consider other factors before making investment decisions [12][17].

Core Viewpoint - Perrigo has a complex history as a publicly traded company, with significant past events such as Mylan's $205 offer in 2015, which was rejected by Perrigo's board. The company is now positioned differently in the market, and its stock is currently perceived as undervalued relative to its fundamentals and peers [1]. Group 1: Investment Strategy - The focus is on identifying companies that offer healthy dividends and have clear potential for capital appreciation, emphasizing the importance of rewarding shareholders [1]. - The investment strategy involves looking for companies that are temporarily undervalued compared to their fundamentals, peers, or historical levels, with a preference for those with foreseeable catalysts for capital appreciation [1]. - The analysis often includes HVAC-related stocks, reflecting the analyst's previous professional involvement in that industry before transitioning to private investing [1].