Perrigo Company Reports 6.1% Decline in Net Sales for Fiscal Year 2024

Perrigo Company plc reported a decline in financial performance for the fiscal year ended December 31, 2024, with net sales of $4.37 billion, a decrease of 6.1% from $4.66 billion in 2023. The company's gross profit also fell to $1.54 billion, down from $1.68 billion, resulting in a gross profit margin of 35.3%, compared to 36.1% in the previous year. Operating income decreased by 25.7% to $112.9 million, reflecting challenges in sales volumes and increased costs associated with restructuring and remediation efforts in its infant formula segment.

The decline in revenue was attributed to several factors, including a $206.1 million drop in net sales volumes, particularly in the Pain & Sleep Aids, Upper Respiratory, and Digestive Health categories, as well as a $108.4 million decrease in the U.S. Nutrition category. The company also faced a $50.6 million reduction in sales due to divestitures, including the sale of its Rare Diseases Business and Hospital & Specialty Business. Despite these challenges, Perrigo noted growth in its Women's Health and Skin Care categories, driven by new product launches such as the Opill® birth control pill.

Strategically, Perrigo has been active in restructuring its operations, launching initiatives like the Supply Chain Reinvention Program and Project Energize, aimed at improving efficiency and profitability. The company reported that it expects to achieve annual savings of $200 million to $300 million by the end of fiscal year 2028 from these initiatives. Additionally, Perrigo completed the sale of its Rare Diseases Business for $244.5 million and the Hospital & Specialty Business for $13.3 million, which contributed to a pre-tax gain of $5.8 million and $0.6 million, respectively.

Operationally, Perrigo's workforce consisted of 8,379 employees across 33 countries as of December 31, 2024. The company continues to focus on enhancing its product offerings and expanding its market presence, particularly in the self-care sector. The company reported that sales to Walmart represented 11.9% of its consolidated net sales in 2024, consistent with the previous year. Looking ahead, Perrigo anticipates ongoing challenges from inflationary pressures and geopolitical instability, particularly related to the war in Ukraine and conflicts in the Middle East, which may impact its supply chain and overall financial performance.

In conclusion, while Perrigo faced significant headwinds in 2024, including declining sales and increased operational costs, the company is implementing strategic initiatives aimed at stabilizing and strengthening its business model. The outlook remains cautious, with management emphasizing the need to navigate ongoing market uncertainties while focusing on long-term growth and efficiency improvements.