Perrigo Co PLC (PRGO, Financial) released its 8-K filing on February 27, 2024, disclosing its financial results for the fourth quarter and fiscal year 2023. The company, a leading provider of Consumer Self-Care Products, reported a record-breaking year with net sales reaching $4.7 billion, marking a 4.6% increase from the previous year. The fourth quarter saw a modest rise in net sales to $1.2 billion, a 0.1% uptick from the same period last year.
Perrigo's performance reflects its strategic focus on consumer self-care, having divested its animal health and generic pharmaceuticals businesses to concentrate on this sector. With a significant presence in North America, Europe, Australia, and parts of Asia, the company's portfolio includes well-known brands such as Compeed, Solpadeine, and ellaOne.
The company's gross margin showed significant improvement, with a reported increase of 380 basis points to 36.9% in the fourth quarter and a 340 basis point rise to 36.1% for the fiscal year. Adjusted diluted earnings per share (EPS) also saw substantial growth, with a 14.7% increase to $0.86 in Q4 and a 24.6% jump to $2.58 for the fiscal year.
Operating cash flow for the fourth quarter was robust at $209 million, leading to an impressive conversion rate of 178%. For the fiscal year, operating cash flow reached $406 million with a conversion rate of 115%.
In a strategic move to bolster its growth, Perrigo announced the launch of 'Project Energize,' an investment and efficiency program aimed at driving the company's sustainable growth strategy. This initiative is expected to deliver annual pre-tax savings in the range of $140 million to $170 million by 2026, with a portion of these savings reinvested into the business.
Looking ahead, Perrigo provided its fiscal 2024 outlook, projecting organic net sales growth of 1.0%-3.0% and a flat total net sales compared to the prior year. The company also anticipates an adjusted diluted EPS range of $2.50 to $2.65, signaling mid-teens growth when excluding the U.S. infant formula business.
President and CEO Patrick Lockwood-Taylor commented on the results and future outlook, stating:
"We exited 2023 with our international business firing on all cylinders and our U.S. OTC business performing well amid a normalizing consumer environment. In addition, our accretive initiatives, which helped drive meaningful year-over-year financial results, remain on track. Heading into 2024, while we expect these positive trends to continue they will be balanced against headwinds from actions we are taking to augment and strengthen our infant formula business with stabilization expected in the second half of 2024."
For a detailed reconciliation of non-GAAP adjustments and further financial information, refer to Tables I through VII in the earnings release.
Investors and interested parties can access the earnings webcast and conference call for additional insights into Perrigo's performance and strategic initiatives.
Explore the complete 8-K earnings release (here) from Perrigo Co PLC for further details.
