goldman sachs consumer staples forum v6 - read …...ww consumer e-commerce net sales growth 1q20...

Goldman Sachs Consumer Staples Forum May 18, 2020

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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 andinvolve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of the Companyor its industry to be materially different from those expressed or implied by any forward-looking statements. In some cases, forward-looking statements can beidentified by terminology such as “may,” “will,” “could,” “would,” “should,” “expect,” “forecast,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “predict,” “potential” orthe 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-lookingstatements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond the Company’s control, including: the effect ofthe novel coronavirus (COVID-19) pandemic and the associated economic downturn and supply chain impacts on the Company's business; the timing, amount andcost of any share repurchases; future impairment charges; customer acceptance of new products; competition from other industry participants, some of whom havegreater 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 Notice of Assessment (the “NoA”) issued by the Irish tax authority and the draft and finalNotices of Proposed Assessment (“NOPAs”) issued by the U.S. Internal Revenue Service and the impact that an adverse result in any such proceedings would haveon operating results, cash flows, and liquidity; potential third-party claims and litigation, including litigation relating to the Company’s restatement of previously-filedfinancial information, securities matters, drug pricing and uncertain tax positions, including the NoA and the NOPAs; potential impacts of ongoing or futuregovernment investigations and regulatory initiatives; potential costs and reputational impact of product recalls or sales halts; the impact of tax reform legislation andhealthcare policy; general economic conditions; fluctuations in currency exchange rates and interest rates; the consummation of announced acquisitions ordispositions and the success of such transactions, and the Company’s ability to realize the desired benefits thereof; and the Company’s ability to execute andachieve the desired benefits of announced cost-reduction efforts and strategic and other initiatives. An adverse result with respect to the Company’s appeal of anymaterial outstanding tax assessments or litigation including securities matters or drug pricing could ultimately require the use of corporate assets to pay suchassessments, damages resulting from third-party claims, and related interest and/or penalties, and any such use of corporate assets would limit the assets availablefor other corporate purposes. Statements regarding the separation of the RX business, including the expected benefits, anticipated timing, form of any suchseparation and whether the separation ultimately occurs, are all subject to various risks and uncertainties, including future financial and operating results, our abilityto separate the business, the effect of existing interdependencies with our manufacturing and shared service operations, and the tax consequences of the plannedseparation to the Company or its shareholders. These and other important factors, including those discussed under “Risk Factors” in the Company’s Form 10-K forthe year ended December 31, 2019, as well as the Company’s subsequent filings with the United States Securities and Exchange Commission, may cause actualresults, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. The forward-looking statements inthis presentation are made only as of the date hereof, and unless otherwise required by applicable securities laws, the Company disclaims any intention or obligationto update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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Perrigo is a $5.1B global Self-Care leader

Consumer Self-Care Americas Consumer Self-Care International Rx Generic Pharmaceuticals• ‘Focused Consumer Brands’

strategy of leading regional brands

• Maintaining share in growing European OTC marketplace

• More than 200 brands sold via 25 Countries, 95% in Europe

• Growing e-Commerce platform

Note: Based on 2020 net sales guidance of growth of 6-7% compared to 2019 reported results.

• Leading self-care provider in OTC, Infant Formula and Oral Care

• Win-Win-Win: Consumers, customers and Perrigo

• More than 400 products, +7K SKUs & +130 customers

• Growing e-Commerce platform

Worldwide Consumer Business ~80% of Net Sales Worldwide Consumer Business ~80% of Net Sales Stand Alone Rx ~20% Net Sales Stand Alone Rx ~20% Net Sales

• Leading portfolio of generic ‘Extended Topical’ products

• Capabilities across complex dosage forms

• Diversified portfolio

• Highly productive R&D organization to drive pipeline

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To make lives better by bringing Quality, Affordable Self-Care Products that consumers trust everywhere they are sold

A new vision and consumer focus adopted one year ago

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Made significant progress during year one of our two to three-year transformation journey!

Reconfigure the portfolio

Reconfigure the portfolio

Achieve base planAchieve base plan

Invest in repeatable growth platforms

Invest in repeatable growth platforms

Fund growth sustainably

Fund growth sustainably

Drive organization effectiveness and build capabilities

Drive organization effectiveness and build capabilities

Deliverconsistent and

sustainable results

Deliverconsistent and

sustainable results

Capital allocationCapital allocation

1

2

3

45

6

7

To make lives better by bringing Quality,

Affordable Self-Care Products™ that consumers trust

everywhere they are sold

• New vision shared globally • 5 acquisitions 2 divestitures

• Improved customer service levels• Gained market share and increased

store-brand penetration• Accelerated e-Commerce by 72%

• 5 global growth platforms identified• $500M+ in new product pipeline• Invested in digital and e-Commerce• Rx to OTC switches reoccuring

• Invested in business intelligence capabilities• 40%+ leadership changed• Centralized key global functions

• $100M cost savings identified and on track through Project Momentum

• $500M in cash on balance sheet• Increased dividend for the 16th

consecutive year• $150M committed capacity

investments

• 6 consecutive quarters of meeting/beating expectations

• ~30% of PRGO now owned by consumer investors

• Revenue growth restored

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-10%

-5%

0%

5%

10%

15%

20%

Q1:18 Q2:18 Q3:18 Q4:18 Q1:19 Q2:19 Q3:19 Q4:19 Q1:20

Consolidated Net Sales Growth*

Organic Net Sales Growth** Net Sales Growth Excluding Exited Businesses & Currency***

Year 1 focused on returning company to revenue growth

*See attached Appendix for reconciliation of Adjusted (Non-GAAP) to Reported (GAAP) amounts.**Organic net sales growth excludes the 2019 acquisition of Ranir, exited businesses and the impact of currency.***Exited businesses excludes (1) the divested animal health and exited infant foods businesses, which were previously included in the Consumer Self-Care Americas segment, (2) the divested Belgium distribution and Russian businesses, and the Canoderm prescription product, which were previously included in the Consumer Self-Care International business, and (3) the divested Israel API business, which was previously included in the Rx business.

TransformationLaunch

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Started 2020 with especially strong growth

Q1 2020 Net Sales Growth YoY,Excluding Exited Businesses & Currency

6%

14%

25%

21%

18%

0% 5% 10% 15% 20% 25% 30%

Rx Pharmaceuticals

CSC International

CSC Americas

Worldwide Consumer

Perrigo Consolidated

*See attached Appendix for reconciliation of Adjusted (Non-GAAP) to Reported (GAAP) amounts.**Exited businesses excludes the divested animal health business in the prior year period, which was previously included in the Consumer Self-Care Americas segment, and the divested Canoderm prescription product, which was previously included in the Consumer Self-Care International business.

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CSCA Organic Net Sales Growth YoY** COVID PRIORITIES

1. Employee safety and business continuity

2. Appreciating frontline employees

3. Supporting the communities where we work

and live

8%

28%

0%

5%

10%

15%

20%

25%

30%

JAN/FEB MARCH

With strong organic growth before COVID-19 demand surge

*See attached Appendix for reconciliation of Adjusted (Non-GAAP) to Reported (GAAP) amounts.**Organic net sales growth excludes the 2019 acquisition of Ranir, exited businesses and the impact of currency; Exited businesses excluded the divested animal health business in the prior year period, which was previously included in the Consumer Self-Care Americas segment.

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Global investment over the past 2 years in e-Commerce are paying off!

WW Consumer e-Commerce as a % to Net Sales

3.1%3.5% 3.6% 3.5%

4.6%

0%

1%

2%

3%

4%

5%

6%

Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020

WW Consumer e-Commerce Net Sales Growth 1Q20 vs.

1Q19:

+72%

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Year two and three of transformation focused on profitable growth

Stabilize and grow margins

Finish technology upgrades Centralize finance SAP rollout Business intelligence & data analytics capabilities

Expand capacity & strengthen supply chain Infant formula Tablet manufacturing

Reduce uncertainty Moving forward with Irish Tax Judicial Review Compelling legal submissions

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In summary, we believe Perrigo is a compelling investment

Unique business well positioned for ‘New Normal’ - Self-care, Value and E-commerce

Investments in bolt-on acquisitions, e-commerce and innovation are paying off

Store Brands historically perform well in times of economic uncertainty

Experienced leadership team and energized employees

Strong cash flow conversion

Managing tax uncertainties

Value PropositionValue Proposition

Three Months EndedMarch 31,

2018April 1,

2017Total

ChangeFX

ChangeConstant Currency

ChangeNet salesConsolidated $ 1,217.0 $ 1,194.0

Less: Belgium distribution business and Russian business — (21.7)

Less: Israel API — (19.0)

Consolidated net sales as so adjusted $ 1,217.0 $ 1,153.3 5.5% (3.8)% 1.7%

Three Months EndedJune 30,

2018July 1,

2017Total

ChangeFX




Less: Israel API — (16.1)

Consolidated net sales as so adjusted $ 1,186.4 $ 1,214.5 (2.3)% (1.6)% (3.9)%

APPENDIX

PERRIGO COMPANY PLCRECONCILIATION OF NON-GAAP MEASURESADJUSTED NET SALES GROWTH - SELECTED

SEGMENTS(in millions)(unaudited)

Three Months EndedSeptember 29,

2018September 30,

2017Total

ChangeFX




Less: Israel API $ — $ (16.5)

Consolidated net sales as so adjusted $ 1,133.1 $ 1,213.0 (6.6)% 1.0% (5.6)%

Three Months EndedDecember 31,

2018December 31,

2017Total

ChangeFX




Less: Israel API $ (4.1)

Consolidated net sales as so adjusted $ 1,195.2 $ 1,276.7 (6.4)% 1.4% (5.0)%

PERRIGO COMPANY PLCRECONCILIATION OF NON-GAAP MEASURES

ADJUSTED NET SALES GROWTH - SELECTED SEGMENTSCONTINUED(in millions)(unaudited)


2019March 31,

2018Total

ChangeFX



Less: animal health (19.6) (26.3)Less: infant foods (5.3) (9.0)

Consolidated net sales as so adjusted $ 1,149.6 $ 1,181.7 (2.7)% 3.0% 0.3%

Three Months EndedJune 29,

2019June 30,

2018Total

ChangeFX



Less: animal health (22.3) (31.9)Less: infant foods (0.8) (10.0)

Consolidated net sales as so adjusted $ 1,125.9 $ 1,144.5 (1.6)% 2.1% 0.5%



Three Months Ended

September 28, 2019

September 29, 2018

Total Change

FX Change

Constant Currency Change

Net salesConsolidated $ 1,191.1 $ 1,133.1

Less: animal health (1.8) (20.4)Less: infant foods — (8.1)Plus: Ranitidine market withdrawal* 9.2 —

Consolidated net sales as so adjusted $ 1,198.5 $ 1,104.6 8.5% 1.7% 10.2%Less: Ranir (77.0) —

Organic Consolidated net sales as so adjusted $ 1,121.5 $ 1,104.6 1.5% 1.7% 3.2%

*Ranitidine market withdrawal includes reversal of recorded returns and inventory write-downs.

Three Months Ended

December 31, 2019

December 31, 2018

Total Change

FX Change


Net salesConsolidated $ 1,322.8 $ 1,195.2

Less: animal health — (15.3)Less: infant foods — (7.0)






2020March 30,

2019Total

ChangeFX


ChangeNet salesRX $ 257.7 $ 241.9 6.5% (0.4)% 6.1%

Consolidated $ 1,341.0 $ 1,174.5 14.2%Less: animal health — (19.6)Less: Canoderm prescription product — (3.7)



Worldwide consumerCSCA $ 700.6 $ 581.8CSCI 382.7 350.8

Total Worldwide Consumer $ 1,083.3 $ 932.6 16.2% 1.5% 17.7%Less: animal health — (19.6)Less: Canoderm prescription product — (3.7)

Worldwide Consumer net sales as so adjusted $ 1,083.3 $ 909.3 19.1% 1.6% 20.7%

CSCA $ 700.6 $ 581.8Less: animal health — (19.6)

CSCA net sales as so adjusted $ 700.6 $ 562.2 24.6% 0.2% 24.8%

CSCI $ 382.7 $ 350.8 9.1% 3.8% 12.9%Less: Canoderm prescription product — (3.7)

CSCI net sales as so adjusted $ 382.7 $ 347.1 10.3% 3.8% 14.1%



Two Months Ended

February 29, 2020

March 2, 2019

Total Change

FX Change


Net salesCSCA $ 429.4 $ 374.9 14.5% —% 14.5%

Less: animal health — (11.6)CSCA net sales as so adjusted $ 429.4 $ 363.3 18.2% —% 18.2%

Less: Ranir (37.6) —Organic CSCA net sales as so adjusted $ 391.8 $ 363.3 7.8% —% 7.8%

One Month Ended

March 28, 2020

March 30, 2019

Total Change

FX Change


Net salesCSCA $ 271.2 $ 206.9 31.1% 0.5% 31.6%

Less: animal health — (7.9)CSCA net sales as so adjusted $ 271.2 $ 199.0 36.3% 0.5% 36.8%

Less: Ranir (17.6) —Organic CSCA net sales as so adjusted $ 253.6 $ 199.0 27.4% 0.6% 28.0%



goldman sachs consumer staples forum v6 - read …...ww consumer e-commerce net sales growth 1q20...

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