Kenvue (KVUE) - 2023 Q4 - Annual Report

Part I Business Kenvue, the world's largest pure-play consumer health company, achieved $15.4 billion in 2023 net sales across three segments, emphasizing digital marketing and innovation in a competitive, regulated market Company Overview Kenvue, the world's largest pure-play consumer health company, achieved $15.4 billion in 2023 net sales across three segments, becoming fully independent from J&J in August 2023 - Kenvue is the world's largest pure-play consumer health company by revenue, with net sales of $15.4 billion in 2023[17] - The company operates through three reportable business segments: Self Care, Skin Health and Beauty, and Essential Health[17] - In August 2023, Kenvue completed its separation from Johnson & Johnson (J&J) and became a fully independent public company; J&J retains approximately 9.5% of Kenvue's outstanding common stock[18] Brands and Product Portfolio Kenvue's portfolio is organized into three global reportable segments, each leveraging category-specific expertise while benefiting from the company's overall scale, including Self Care, Skin Health and Beauty, and Essential Health Kenvue Reportable Segments and Major Brands | Segment | Product Categories | Major Brands | | :--- | :--- | :--- | | Self Care | Pain Care; Cough, Cold, and Allergy; Other (Digestive Health, Smoking Cessation, etc.) | Tylenol®, Motrin®, Benadryl®, Nicorette®, Zyrtec®, Zarbee's™ | | Skin Health and Beauty | Face and Body Care; Hair, Sun, and Other | Neutrogena®, Aveeno®, Dr.Ci:Labo®, OGX®, Rogaine® | | Essential Health | Oral Care; Baby Care; Other (Women's Health, Wound Care, etc.) | Listerine®, Johnson's®, BAND-AID® Brand Adhesive Bandages, Stayfree® | Brand Marketing Kenvue employs a digital-first marketing strategy, significantly increasing its digital media spend from approximately 44% in 2019 to about 73% in 2023, enabling flexible targeting and data-driven ROI evaluation - The company has shifted to a digital-first marketing approach, increasing its share of digital spend from approximately 44% of total media spend in 2019 to approximately 73% in 2023[25] - This digital focus enables flexibility, efficient reach to high-value audiences, and the use of data science and analytics to evaluate media ROI and identify growth opportunities[25][26] Product Development and Innovation Kenvue's R&D organization, comprising approximately 1,500 scientists and engineers, focuses on human-centric product development, leveraging scientific expertise and partnerships to drive continuous innovation based on consumer insights - The global R&D team consists of approximately 1,500 scientists, doctors, pharmacists, and engineers with expertise across various core disciplines[29] - The R&D process is centered on human empathy, utilizing consumer insights and partnerships with healthcare professionals to identify unmet needs and drive product innovation[27][30][31] Supply Chain and Manufacturing Kenvue utilizes a balanced manufacturing footprint, with over half of its 2023 production from in-house facilities and the remainder from third-party suppliers, supported by a distribution network primarily partnering with third-party operators while adhering to rigorous quality standards - In 2023, over half of the production volume was delivered by Kenvue's in-house manufacturing facilities, with the rest supplied by external manufacturers[35] - The company purchases principal raw materials like resin, pulp, corn derivatives, and vegetable oils from multiple third-party sources, with no single supplier providing a significant portion of total requirements[34] - The distribution network largely relies on partnerships with expert third-party operators for warehousing and distribution, ensuring compliance with Kenvue's quality standards through regular audits[36][37] Competition Kenvue faces significant competition across its segments from a diverse range of companies, including global consumer healthcare and CPG firms, regional players, generic OTC manufacturers, and private-label brands Key Competitors by Segment | Segment | Key Competitors | | :--- | :--- | | Self Care | Haleon, Procter & Gamble, Reckitt Benckiser Group, private-label brands | | Skin Health and Beauty | Beiersdorf, L'Oréal, Procter & Gamble, Unilever, private-label brands | | Essential Health | Colgate-Palmolive, Kimberly Clark, Procter & Gamble, Unilever, private-label brands | Environmental, Social, and Governance Kenvue's ESG strategy, the "Healthy Lives Mission," is built on three pillars: Healthy People, Healthy Planet, and Healthy Practice, guiding goals in diversity, public health, climate change, sustainable packaging, and ethical practices, with Board oversight - The ESG strategy, "Healthy Lives Mission," focuses on three pillars: Healthy People, Healthy Planet, and Healthy Practice[43] - Key focus areas under these pillars include Diversity, Equity & Inclusion; Climate Change; Plastics; and Sustainable Product Innovation[45][52] - The Board of Directors provides ultimate oversight for ESG matters, with responsibilities allocated across its three key committees[50] Human Capital As of December 31, 2023, Kenvue employed approximately 22,000 people globally, emphasizing a culture of performance and commitment to diversity, equity, and inclusion, with a global workforce that is 50% female and a leadership team that is 54% female - As of December 31, 2023, Kenvue had approximately 22,000 employees worldwide[56] - The global workforce is approximately 50% male and 50% female; in the U.S., 36% of employees identify as racial or ethnic minorities[58] - Key DE&I goals include strengthening female and ethnic representation at all management levels to reflect the market, ensuring equitable pay, and achieving a top-quartile Inclusion Index Score[60] Intellectual Property Kenvue relies on trademarks, trade secrets, patents, and copyrights to protect its business, with brands being critical to its success, and has been granted limited-duration licenses by J&J for certain legacy branding post-separation - The company's success is heavily dependent on its brand portfolio, with the vast majority of net sales from products with proprietary trademarks and trade names[69] - Post-separation, J&J has licensed certain intellectual property, including the "Johnson & Johnson" name and other legacy branding, to Kenvue for a limited time[68] - While the company maintains a portfolio of patents, no single patent is considered material to any specific product or product family[71] Government Regulations Kenvue is subject to extensive and complex global government regulations, with key oversight in the U.S. from the FDA, FTC, and CPSC, covering product development, manufacturing, labeling, advertising, safety, and data privacy, with a trend toward increasingly stringent requirements - The business is regulated by numerous U.S. federal authorities, including the FDA, FTC, CPSC, OSHA, EPA, and DEA, as well as comparable bodies in other jurisdictions[72] - Product classifications such as OTC drugs, cosmetics, medical devices, and dietary supplements are subject to different regulatory frameworks that vary by market, including the U.S., EU, and China[73][76][78][81][82] - The company is also subject to evolving laws in areas like environmental, health and safety (EHS), privacy and data protection (e.g., GDPR, PIPL), and anti-corruption (e.g., FCPA)[89][92][94] Seasonality Kenvue's business is generally not seasonal, though some products experience minor fluctuations, such as increased sales of cold/flu products in winter and allergy products in spring/fall, with minimal net effect on annual sales - The overall business is not considered seasonal, but certain product categories exhibit seasonal sales patterns[97] - Self Care products for cold/flu and allergies see increased sales in winter and spring/fall, respectively; Skin Health products with SPF are higher in summer, while moisturizers are higher in fall/winter[97] Risk Factors Kenvue faces diverse risks including intense competition, brand reputation threats, operational dependencies, supply chain disruptions, cybersecurity vulnerabilities, significant product liability litigation, intellectual property challenges, and financial exposures from global economic conditions and substantial debt Risks Related to Our Business, Industry and Operations Kenvue faces risks from intense competition, potential damage to its brand reputation, and the need to adapt to shifting consumer preferences and market trends, alongside operational challenges including reliance on third-party manufacturers, supply chain disruptions, inflationary pressures, IT security breaches, and attracting and retaining talent - The company faces substantial competition from multinational corporations, private-label brands, and generic products across all segments and markets[101][110] - One customer accounted for approximately 12% of total net sales in 2023, highlighting dependence on key retail partners amidst a changing retail landscape[124] - Operational risks include reliance on third parties for manufacturing key products like Tylenol® and Zyrtec®, potential supply chain disruptions, and volatility in raw material costs[143][144][149] - The business is increasingly dependent on IT systems, exposing it to cybersecurity threats, which could result in operational disruption and reputational damage[155][156] Risks Related to Government Regulation, Legal Proceedings and Financial and Economic Market Conditions The company is subject to extensive global regulations and significant legal risks, including product liability litigation concerning ingredients like talc, acetaminophen, and phenylephrine, which could result in substantial expenses and reputational harm, alongside financial and economic risks from global operations, foreign currency fluctuations, geopolitical events, and potential impairment of assets - The company is subject to legal proceedings related to talc-containing products sold outside the U.S. and Canada; while J&J has indemnified Kenvue for Talc-Related Liabilities within the U.S. and Canada, this indemnity may not be sufficient, and Kenvue remains responsible for claims elsewhere[192][194][195] - Litigation has been filed alleging links between prenatal exposure to acetaminophen (Tylenol®) and developmental disorders, and class actions have been filed regarding the effectiveness of phenylephrine (PE) as a nasal decongestant[187][188] - The business is exposed to risks from global operations, including foreign currency fluctuations, geopolitical tensions, and trade policy changes; the Russia-Ukraine war has led to the suspension of most product supplies to Russia[222][226][228] - Changes in tax laws or increased audit scrutiny could adversely affect the company's effective tax rate and financial condition[220][221] Risks Related to Our Relationship with J&J Kenvue faces risks from its recent separation from J&J, including historical financial data not reflecting future performance, potential failure to achieve expected separation benefits, rebranding challenges, reliance on J&J for critical functions under transitional agreements, potential conflicts of interest, and significant indemnification obligations to and from J&J - Historical financial information may not be indicative of future results as it was prepared on a carve-out basis while part of J&J's broader organization[238][239] - Kenvue relies on J&J for manufacturing of key products (Tylenol®, Zyrtec®) and other critical services under transitional agreements; failure to perform by J&J or to find replacements upon expiration could adversely affect the business[256][259] - J&J has agreed to indemnify Kenvue for certain liabilities, including talc-related claims in the U.S. and Canada, but this indemnity may not be sufficient to cover the full amount of such liabilities[266] - To preserve the tax-free nature of the separation, Kenvue is restricted from engaging in certain strategic transactions, such as mergers or large stock issuances, until August 2025[265] Risks Related to Ownership of Our Common Stock Ownership of Kenvue common stock involves risks including potential stock price volatility, the possibility that an active trading market may not be sustained, potential price depression from future sales by J&J, the need to implement effective internal controls as a new public company, and financial flexibility limitations due to significant debt obligations - The stock price may be volatile, and future sales by J&J, which owned approximately 9.5% of common stock as of year-end 2023, could cause the price to decline[272][274] - The company has substantial debt obligations from its separation financing, which could require a significant portion of cash flow for interest payments and limit business flexibility[280][282] - As a holding company, Kenvue depends on dividends and distributions from its subsidiaries to meet its obligations, including debt service and potential dividends to its own shareholders[284] - Certain provisions in the company's certificate of incorporation and bylaws, along with Delaware law, may prevent or delay an acquisition, potentially decreasing the stock's trading price[288] Unresolved Staff Comments Not applicable; the company has no unresolved staff comments - There are no unresolved staff comments[295] Cybersecurity Kenvue's cybersecurity risk management is integrated into its Enterprise Risk Management (ERM) framework, led by the CISO, based on best practices like the NIST Cybersecurity Framework, and overseen by the Nominating, Governance and Sustainability Committee of the Board - Cybersecurity risk management is integrated into the company's Enterprise Risk Management (ERM) Framework and is based on standards such as the NIST Cybersecurity Framework[296][297] - The Nominating, Governance and Sustainability Committee of the Board is responsible for overseeing privacy and cybersecurity risks, meeting at least twice a year with the CISO[302] - The company has a dedicated Data Incident Response Program to identify, assess, and manage significant data incidents and determine reporting obligations on a timely basis[297] Properties As of December 31, 2023, Kenvue utilizes approximately 214 global facilities for administration, R&D, manufacturing, and distribution, and is relocating its global corporate headquarters and R&D center to Summit, New Jersey, between 2025 and 2026 - As of year-end 2023, the company utilizes approximately 214 facilities worldwide, with 44 owned and 170 leased or used by other rights[306] - A new global corporate headquarters and R&D center is being established in Summit, New Jersey, with a long-term lease signed in April 2023; the relocation is planned for 2025-2026[308] Legal Proceedings Information regarding legal proceedings is incorporated by reference from Note 17, "Commitments and Contingencies," to the Consolidated Financial Statements - Details on legal proceedings are provided in Note 17 of the financial statements[310] Mine Safety Disclosures Not applicable; the company has no mine safety disclosures - This item is not applicable to the company[311] Part II Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Kenvue's common stock trades on the NYSE under the symbol "KVUE" since May 2023, with quarterly dividends of $0.20 per share paid, and a share repurchase program authorized in Q3 2023, under which 350,000 shares were repurchased in December 2023 - The company's common stock began trading on the NYSE under the symbol "KVUE" on May 4, 2023[312][316] 2023 Dividend Summary | Declaration Date | Record Date | Payment Date | Per Share Amount | | :--- | :--- | :--- | :--- | | July 20, 2023 | August 28, 2023 | September 7, 2023 | $0.20 | | October 26, 2023 | November 8, 2023 | November 22, 2023 | $0.20 | Share Repurchases in Q4 2023 | Period | Total Number of Shares Purchased (Thousands) | Average Price Paid Per Share | Shares Remaining for Purchase (Thousands) | | :--- | :--- | :--- | :--- | | Oct 1 - Oct 31 | — | $ — | 27,000 | | Nov 1 - Nov 30 | — | $ — | 27,000 | | Dec 1 - Dec 31 | 350 | $ 20.47 | 26,650 | Management's Discussion and Analysis of Financial Condition and Results of Operations In 2023, Kenvue reported net sales of $15.4 billion, a 3.3% increase, with 5.0% organic growth, but net income decreased to $1.66 billion due to higher SG&A and interest expenses, while generating $3.2 billion in cash from operations and ending the year with $1.4 billion in cash, following significant debt issuance post-separation Results of Operations For fiscal year 2023, Kenvue's net sales increased 3.3% to $15.44 billion, with 5.0% organic growth, while gross profit rose 4.3% to $8.64 billion, but operating income declined 6.1% to $2.51 billion and net income decreased 19.4% to $1.66 billion due to increased SG&A and new interest expense Fiscal Year 2023 vs 2022 Performance | Metric (in Millions) | FY 2023 | FY 2022 | Change (%) | | :--- | :--- | :--- | :--- | | Net sales | $15,444 | $14,950 | 3.3% | | Gross profit | $8,643 | $8,285 | 4.3% | | Operating income | $2,512 | $2,675 | (6.1)% | | Net income | $1,664 | $2,064 | (19.4)% | - Organic sales growth was 5.0%, driven by value realization (price/mix) of 7.7%, partially offset by a volume decline of 2.7%[355][376] - SG&A expenses increased by $508 million (9.0%), primarily due to higher costs in enterprise functions as a standalone company, transition service agreement costs with J&J, and a $255 million increase in non-recurring Separation-related costs[357] - The company incurred $250 million in net interest expense in 2023, compared to none in 2022, due to debt issued in connection with the IPO[360] Segment Results In fiscal 2023, the Self Care segment was the primary growth driver, with net sales increasing 7.0% to $6.5 billion and adjusted operating income up 10.1%, while Skin Health and Beauty saw a slight sales increase of 0.6% to $4.4 billion but a 4.1% decline in adjusted operating income, and Essential Health's sales grew 1.0% to $4.6 billion but its adjusted operating income decreased by 9.0% Segment Net Sales (FY 2023 vs FY 2022) | Segment (in Millions) | FY 2023 Net Sales | FY 2022 Net Sales | Change (%) | Organic Growth (%) | | :--- | :--- | :--- | :--- | :--- | | Self Care | $6,451 | $6,030 | 7.0% | 8.4% | | Skin Health and Beauty | $4,378 | $4,350 | 0.6% | 1.8% | | Essential Health | $4,615 | $4,570 | 1.0% | 3.6% | | Total | $15,444 | $14,950 | 3.3% | 5.0% | Segment Adjusted Operating Income (FY 2023 vs FY 2022) | Segment (in Millions) | FY 2023 Adj. Op. Income | FY 2022 Adj. Op. Income | Change (%) | | :--- | :--- | :--- | :--- | | Self Care | $2,299 | $2,088 | 10.1% | | Skin Health and Beauty | $679 | $708 | (4.1)% | | Essential Health | $1,011 | $1,111 | (9.0)% | | Total | $3,989 | $3,907 | 2.1% | Liquidity and Capital Resources Kenvue's primary liquidity sources include $1.4 billion cash on hand, cash from operations ($3.2 billion in 2023), a $4.0 billion revolving credit facility, and a $4.0 billion commercial paper program, with $7.75 billion in Senior Notes issued and $13.8 billion distributed to J&J in connection with its separation Cash Flow Summary (FY 2023 vs FY 2022) | Cash Flow (in Millions) | FY 2023 | FY 2022 | | :--- | :--- | :--- | | Net cash from operating activities | $3,168 | $2,525 | | Net cash used in investing activities | $(488) | $(390) | | Net cash used in financing activities | $(2,527) | $(1,583) | - Primary sources of liquidity include $1.4 billion in cash, a $4.0 billion Revolving Credit Facility (undrawn as of year-end), and a $4.0 billion Commercial Paper Program ($599 million outstanding)[391][392] - In March 2023, the company issued $7.75 billion in Senior Notes across eight series with maturities ranging from 2025 to 2063[397][566] - On May 8, 2023, Kenvue made a distribution of $13.8 billion to J&J using proceeds from the IPO and debt financing[406] Critical Accounting Policies and Estimates Kenvue's critical accounting policies involve significant management judgment and estimates in areas such as Revenue Recognition (variable consideration), Income Taxes (post-separation complexities), Goodwill and Intangible Assets valuation (annual impairment testing), and Stock-Based Compensation (fair value estimation using valuation models) - Revenue Recognition: Involves estimating variable consideration such as trade promotions, rebates, and sales returns using the "expected value" or "most likely amount" method[416] - Income Taxes: Calculated on a separate return basis post-separation; the company changed its accounting for Global Intangible Low-Tax Income (GILTI) from the deferred method to the period cost method in Q3 2023[419][423] - Goodwill and Intangible Assets: Goodwill is tested for impairment annually at the reporting unit level using a discounted cash flow model; no impairment was recorded in fiscal 2023[426][427] - Stock-Based Compensation: Fair value of awards is estimated at the grant date using valuation models (e.g., Black-Scholes for options) with assumptions for volatility, dividend yield, and risk-free rates[430] Quantitative and Qualitative Disclosures About Market Risk Kenvue is exposed to foreign currency, inflation, interest rate, commodity price, and credit risks; a hypothetical 10% unfavorable change in exchange rates would have decreased 2023 net income by approximately $98 million, while inflationary pressures are managed through price increases, and interest rate risk is mitigated by a primarily fixed-rate debt portfolio - Foreign Currency Risk: A hypothetical 10% unfavorable change in the average exchange rate would have reduced FY2023 net income by approximately $98 million[438] - Inflation Risk: The company has experienced and continues to face higher costs for raw materials, transportation, and other inputs, which it partially offsets through price increases and supply chain optimization[440] - Interest Rate Risk: The company's outstanding long-term debt of $7.7 billion is primarily fixed-rate, limiting the impact of market interest rate fluctuations on results; future floating-rate debt could introduce more risk[442][443] - Credit Risk: Credit risk from customer receivables is limited due to a diverse customer base; the company performs credit evaluations to mitigate this risk[446] Financial Statements and Supplementary Data This section contains Kenvue's audited consolidated financial statements for fiscal years ended December 31, 2023, January 1, 2023, and January 2, 2022, including the Independent Registered Public Accounting Firm's Report, Consolidated Balance Sheets, Statements of Operations, Comprehensive Income, Equity, and Cash Flows, along with detailed Notes Report of Independent Registered Public Accounting Firm PricewaterhouseCoopers LLP issued an unqualified opinion on Kenvue's consolidated financial statements, noting a change in accounting principle for global intangible low-taxed income (GILTI) in 2023 and identifying U.S. net sales revenue recognition as a critical audit matter - The independent auditor, PricewaterhouseCoopers LLP, issued an unqualified opinion on the consolidated financial statements[450] - A change in accounting principle for Global Intangible Low-Taxed Income (GILTI) was noted for 2023[451] - U.S. net sales revenue recognition was identified as a critical audit matter due to the high degree of auditor effort involved in procedures related to recording sales and trade promotions[456][457] Consolidated Financial Statements The consolidated financial statements present Kenvue's financial position and performance, with total assets of $27.85 billion, total liabilities of $16.64 billion, and total equity of $11.21 billion as of December 31, 2023, and $15.44 billion in net sales and $1.66 billion in net income for fiscal year 2023, resulting in diluted EPS of $0.90 Key Balance Sheet Data (as of Dec 31, 2023) | Account (in Millions) | Amount | | :--- | :--- | | Total Current Assets | $6,138 | | Total Assets | $27,851 | | Total Current Liabilities | $5,481 | | Long-term debt | $7,687 | | Total Liabilities | $16,640 | | Total Equity | $11,211 | Key Income Statement Data (FY 2023) | Account (in Millions, except EPS) | Amount | | :--- | :--- | | Net sales | $15,444 | | Gross profit | $8,643 | | Operating income | $2,512 | | Net income | $1,664 | | Diluted EPS | $0.90 | Notes to the Consolidated Financial Statements The notes provide detailed disclosures supporting the financial statements, covering the separation from J&J, basis of presentation, accounting policies, segment information, debt, legal contingencies, and the relationship with J&J, including specifics on the $7.75 billion Senior Notes and significant litigation related to acetaminophen, sunscreen, Zantac, and phenylephrine - Note 1 (Description of Company): Details the separation from J&J, completed with the Exchange Offer on August 23, 2023, making Kenvue a fully independent company; also discloses a change in accounting for GILTI to the period cost approach in Q3 2023[474][477][544] - Note 5 (Borrowings): Details the $7.75 billion in Senior Notes issued in March 2023 and the $4.0 billion Commercial Paper Program established as part of the separation financing[566][567][576] - Note 12 (Relationship with J&J): Outlines key agreements governing the post-separation relationship, including the Separation, Tax Matters, Transition Services, and Transition Manufacturing Agreements[651][658][661] - Note 17 (Commitments and Contingencies): Discusses significant product liability litigation, including claims related to acetaminophen (Tylenol®), sunscreen (benzene), Zantac, and phenylephrine (PE)[711][714][718] Changes in and Disagreements With Accountants on Accounting and Financial Disclosure Not applicable; the company reports no changes in or disagreements with its accountants on accounting and financial disclosure - This item is not applicable[735] Controls and Procedures Management, including the CEO and CFO, concluded the company's disclosure controls and procedures were effective as of December 31, 2023, with no material changes to internal controls reported during Q4 2023, and a management report on internal control over financial reporting is not yet required for this newly public company - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of December 31, 2023[737] - A management report on internal control over financial reporting is not included due to the transition period for newly public companies[738] Other Information During the fourth quarter of 2023, no directors or officers adopted or terminated any Rule 10b5-1 trading plans or other non-Rule 10b5-1 trading arrangements - No directors or officers adopted or terminated any Rule 10b5-1 trading arrangements during the fourth quarter of 2023[740] Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable; the company has no disclosures regarding foreign jurisdictions that prevent inspections - This item is not applicable[741] Part III Directors, Executive Officers and Corporate Governance The information required for this item will be included in the company's definitive Proxy Statement for the 2024 Annual Meeting of Shareholders and is incorporated herein by reference - Information is incorporated by reference from the upcoming Proxy Statement[742] Executive Compensation The information required for this item will be included in the company's definitive Proxy Statement for the 2024 Annual Meeting of Shareholders and is incorporated herein by reference - Information is incorporated by reference from the upcoming Proxy Statement[743] Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Information regarding security ownership will be included in the company's 2024 Proxy Statement; as of December 31, 2023, 79,115,372 securities were to be issued upon exercise of outstanding options and rights, with a weighted-average exercise price of $20.60, and 178,706,283 securities remained available for future issuance Equity Compensation Plan Information (as of Dec 31, 2023) | Plan Category | Securities to be Issued Upon Exercise (a) | Weighted-Average Exercise Price (b) | Securities Remaining for Future Issuance (c) | | :--- | :--- | :--- | :--- | | Equity compensation plans approved by security holders | 79,115,372 | $20.60 | 178,706,283 | | Total | 79,115,372 | $20.60 | 178,706,283 | Certain Relationships and Related Transactions, and Director Independence The information required for this item will be included in the company's definitive Proxy Statement for the 2024 Annual Meeting of Shareholders and is incorporated herein by reference - Information is incorporated by reference from the upcoming Proxy Statement[746] Principal Accountant Fees and Services The information required for this item will be included in the company's definitive Proxy Statement for the 2024 Annual Meeting of Shareholders and is incorporated herein by reference - Information is incorporated by reference from the upcoming Proxy Statement[747] Part IV Exhibits and Financial Statement Schedules This section lists the financial statements found in Item 8, notes the omission of financial statement schedules as not applicable, and provides a list of all exhibits filed as part of the Annual Report on Form 10-K, including governance and separation-related agreements - The financial statements required by this item are listed in Item 8[748] - A list of exhibits filed with the report is provided, including key agreements such as the Separation Agreement, Tax Matters Agreement, and Transition Services Agreement with Johnson & Johnson[749][750] Form 10-K Summary None; the company has not provided a Form 10-K summary - No summary is provided[752]