Cover Page
Cover Page - shares | 3 Months Ended | |
Apr. 01, 2023 | May 05, 2023 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Apr. 01, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-36353 | |
Entity Registrant Name | Perrigo Company plc | |
Entity Incorporation, State or Country Code | L2 | |
Entity Address, Address Line One | The Sharp Building, | |
Entity Address, Address Line Two | Hogan Place, | |
Entity Address, City or Town | Dublin 2, | |
Entity Address, Country | IE | |
Entity Address, Postal Zip Code | D02 TY74 | |
Country Region | 353 | |
City Area Code | 1 | |
Local Phone Number | 7094000 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 135,325,847 | |
Entity Central Index Key | 0001585364 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Ordinary Shares, 0.001 Par Value | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Ordinary shares, €0.001 par value | |
Trading Symbol | PRGO | |
Security Exchange Name | NYSE | |
3.900% senior note due 2024 | ||
Document Information [Line Items] | ||
Title of 12(b) Security | 3.900% Notes due 2024 | |
Trading Symbol | PRGO24 | |
Security Exchange Name | NYSE | |
4.375% senior note due March 15, 2026 | ||
Document Information [Line Items] | ||
Title of 12(b) Security | 4.375% Notes due 2026 | |
Trading Symbol | PRGO26 | |
Security Exchange Name | NYSE | |
4.400% Senior Notes due June 15, 2030 | ||
Document Information [Line Items] | ||
Title of 12(b) Security | 4.400% Notes due 2030 | |
Trading Symbol | PRGO30 | |
Security Exchange Name | NYSE | |
5.300% Unsecured Senior Notes due November 15, 2043 | ||
Document Information [Line Items] | ||
Title of 12(b) Security | 5.300% Notes due 2043 | |
Trading Symbol | PRGO43 | |
Security Exchange Name | NYSE | |
4.900% Senior Loan due 2044 | ||
Document Information [Line Items] | ||
Title of 12(b) Security | 4.900% Notes due 2044 | |
Trading Symbol | PRGO44 | |
Security Exchange Name | NYSE |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Apr. 02, 2022 | |
Income Statement [Abstract] | ||
Net sales | $ 1,181.7 | $ 1,074.5 |
Cost of sales | 767.9 | 736.7 |
Gross profit | 413.8 | 337.8 |
Operating expenses | ||
Distribution | 28.6 | 24.4 |
Research and development | 31.1 | 29.3 |
Selling | 167.9 | 135.6 |
Administration | 135 | 122.3 |
Restructuring | 3.4 | 3.6 |
Other operating (income) expense, net | (0.7) | 0.9 |
Total operating expenses | 365.3 | 316.1 |
Operating income | 48.5 | 21.7 |
Interest expense, net | 43.7 | 35.8 |
Other expense (income), net | 0.5 | (1.1) |
Income (loss) from continuing operations before income taxes | 4.3 | (13) |
Income tax expense (benefit) | 5.4 | (11.7) |
Income (loss) from continuing operations | (1.1) | (1.3) |
Income (loss) from discontinued operations, net of tax | (1.9) | (1.1) |
Net income (loss) | $ (3) | $ (2.4) |
Basic | ||
Continuing operations (in dollars per share) | $ (0.01) | $ (0.01) |
Discontinued operations (in dollars per share) | (0.01) | (0.01) |
Basic earnings (loss) per share (in dollars per share) | (0.02) | (0.02) |
Diluted | ||
Continuing operations (in dollars per share) | (0.01) | (0.01) |
Discontinued operations (in dollars per share) | (0.01) | (0.01) |
Diluted earnings (loss) per share (in dollars per share) | $ (0.02) | $ (0.02) |
Weighted-average shares outstanding | ||
Basic (in shares) | 134.9 | 134 |
Diluted (in shares) | 134.9 | 134 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Apr. 02, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ (3) | $ (2.4) |
Other comprehensive income (loss): | ||
Foreign currency translation adjustments | 52.7 | (24.6) |
Change in fair value of derivative financial instruments, net of tax | (31.5) | 10.4 |
Change in post-retirement and pension liability, net of tax | (0.5) | (6.3) |
Other comprehensive income (loss), net of tax | 20.7 | (20.5) |
Comprehensive income (loss) | $ 17.7 | $ (22.9) |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) shares in Millions, $ in Millions | Apr. 01, 2023 | Dec. 31, 2022 |
Assets | ||
Cash and cash equivalents | $ 553 | $ 600.7 |
Accounts receivable, net of allowance for credit losses of $7.1 and $6.8, respectively | 738.7 | 697.1 |
Inventories | 1,183 | 1,150.3 |
Prepaid expenses and other current assets | 266 | 271.8 |
Total current assets | 2,740.7 | 2,719.9 |
Property, plant and equipment, net | 919.3 | 926.3 |
Operating lease assets | 211.7 | 217.1 |
Goodwill and indefinite-lived intangible assets | 3,650.4 | 3,549 |
Definite-lived intangible assets, net | 3,083.9 | 3,230.2 |
Deferred income taxes | 6.1 | 7.1 |
Other non-current assets | 342.8 | 367.7 |
Total non-current assets | 8,214.2 | 8,297.4 |
Total assets | 10,954.9 | 11,017.3 |
Liabilities and Shareholders’ Equity | ||
Accounts payable | 505.2 | 537.3 |
Payroll and related taxes | 106.5 | 136.4 |
Accrued customer programs | 146.7 | 139.1 |
Other accrued liabilities | 272 | 250.2 |
Accrued income taxes | 17.6 | 14.4 |
Current indebtedness | 38.8 | 36.2 |
Total current liabilities | 1,086.8 | 1,113.6 |
Long-term debt, less current portion | 4,062.8 | 4,070.4 |
Deferred income taxes | 333.8 | 368.2 |
Other non-current liabilities | 637.6 | 623 |
Total non-current liabilities | 5,034.2 | 5,061.6 |
Total liabilities | 6,121 | 6,175.2 |
Contingencies - Refer to Note 16 | ||
Controlling interests: | ||
Preferred shares, $0.0001 par value per share, 10 shares authorized | 0 | 0 |
Ordinary shares, €0.001 par value per share, 10,000 shares authorized | 6,910.8 | 6,936.7 |
Accumulated other comprehensive income | (6.3) | (27) |
Retained earnings (accumulated deficit) | (2,070.6) | (2,067.6) |
Total shareholders’ equity | 4,833.9 | 4,842.1 |
Total liabilities and shareholders' equity | $ 10,954.9 | $ 11,017.3 |
Supplemental Disclosures of Balance Sheet Information | ||
Preferred shares, issued and outstanding (in shares) | 0 | 0 |
Ordinary shares, issued and outstanding (in shares) | 135.3 | 134.7 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) $ in Millions | Apr. 01, 2023 € / shares | Apr. 01, 2023 USD ($) $ / shares shares | Dec. 31, 2022 € / shares | Dec. 31, 2022 USD ($) $ / shares shares |
Statement of Financial Position [Abstract] | ||||
Allowance for credit losses | $ | $ 7.1 | $ 6.8 | ||
Stockholders' Equity: | ||||
Preferred shares, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | ||
Preferred shares, authorized (shares) | 10,000,000 | 10,000,000 | ||
Ordinary shares, par value (in EUR per share) | € / shares | € 0.001 | € 0.001 | ||
Ordinary shares, authorized (shares) | 10,000,000,000 | 10,000,000,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Shareholders' Equity - USD ($) shares in Millions, $ in Millions | Total | Ordinary Shares Issued | Accumulated Other Comprehensive Income | Retained Earnings (Accumulated Deficit) |
Beginning balance (shares) at Dec. 31, 2021 | 133.8 | |||
Beginning balance at Dec. 31, 2021 | $ 5,151.7 | $ 7,043.2 | $ 35.5 | $ (1,927) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income (loss) | (2.4) | (2.4) | ||
Other comprehensive income (loss) | (20.5) | (20.5) | ||
Restricted stock plan (shares) | 1.2 | |||
Compensation for restricted stock | 26.3 | $ 26.3 | ||
Cash dividends | (34.2) | $ (34.2) | ||
Shares withheld for payment of employees' withholding tax liability (shares) | (0.4) | |||
Shares withheld for payment of employees' withholding tax liability | (16.4) | $ (16.4) | ||
Ending balance (shares) at Apr. 02, 2022 | 134.6 | |||
Ending balance at Apr. 02, 2022 | 5,104.5 | $ 7,018.9 | 15 | (1,929.4) |
Beginning balance (shares) at Dec. 31, 2022 | 134.7 | |||
Beginning balance at Dec. 31, 2022 | 4,842.1 | $ 6,936.7 | (27) | (2,067.6) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income (loss) | (3) | (3) | ||
Other comprehensive income (loss) | 20.7 | 20.7 | ||
Restricted stock plan (shares) | 1 | |||
Compensation for restricted stock | 24.9 | $ 24.9 | ||
Cash dividends | (36.2) | $ (36.2) | ||
Shares withheld for payment of employees' withholding tax liability (shares) | (0.4) | |||
Shares withheld for payment of employees' withholding tax liability | (14.6) | $ (14.6) | ||
Ending balance (shares) at Apr. 01, 2023 | 135.3 | |||
Ending balance at Apr. 01, 2023 | $ 4,833.9 | $ 6,910.8 | $ (6.3) | $ (2,070.6) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Shareholders' Equity (Parenthetical) - $ / shares | 3 Months Ended | |
Apr. 01, 2023 | Apr. 02, 2022 | |
Statement of Stockholders' Equity [Abstract] | ||
Dividends paid (in dollars per share) | $ 0.27 | $ 0.26 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Apr. 02, 2022 | |
Cash Flows From (For) Operating Activities | ||
Net income (loss) | $ (3) | $ (2.4) |
Adjustments to derive cash flows: | ||
Depreciation and amortization | 88.7 | 69.5 |
Share-based compensation | 24.9 | 26.3 |
Restructuring charges | 3.4 | 3.6 |
Loss on sale of business | 0 | 1.4 |
Amortization of debt discount (premium) | 0.7 | (0.2) |
Gain on sale of assets | (3.9) | (5.8) |
Deferred income taxes | (9.9) | 5.1 |
Other non-cash adjustments, net | 6.4 | (17.5) |
Subtotal | 107.3 | 80 |
Increase (decrease) in cash due to: | ||
Accounts receivable | (39.8) | (38.1) |
Inventories | (28.6) | (10.5) |
Prepaid expenses and other current assets | 17.1 | 8.1 |
Accounts payable | (29.8) | 72.6 |
Payroll and related taxes | (34.3) | (31.8) |
Accrued customer programs | 6.8 | 8.9 |
Accrued liabilities | 8 | 23.7 |
Accrued income taxes | 2.5 | (33.9) |
Other, net | 10.2 | 0.1 |
Subtotal | (87.9) | (0.9) |
Net cash from (for) operating activities | 19.4 | 79.1 |
Cash Flows From (For) Investing Activities | ||
Additions to property, plant and equipment | (23.2) | (20.3) |
Net proceeds from sale of businesses | 0 | 58.7 |
Proceeds from sale of assets | 1.8 | 22.9 |
Proceeds from royalty rights | 1.8 | 1.4 |
Net cash from (for) investing activities | (19.6) | 62.7 |
Cash Flows From (For) Financing Activities | ||
Borrowings (repayments) of revolving credit agreements and other financing, net | (5.9) | 0 |
Cash dividends | (36.2) | (34.2) |
Other financing, net | (8.6) | (17.7) |
Net cash from (for) financing activities | (50.7) | (51.9) |
Effect of exchange rate changes on cash and cash equivalents | 3.2 | (3.7) |
Net increase (decrease) in cash and cash equivalents | (47.7) | 86.2 |
Cash and cash equivalents of continuing operations, beginning of period | 600.7 | 1,864.9 |
Cash and cash equivalents held for sale, beginning of period | 0 | 14.4 |
Less cash and cash equivalents held for sale, end of period | 0 | 0 |
Cash and cash equivalents of continuing operations, end of period | $ 553 | $ 1,965.5 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Apr. 01, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES General Information Perrigo Company plc was incorporated under the laws of Ireland on June 28, 2013 and became the successor registrant of Perrigo Company, a Michigan corporation, on December 18, 2013 in connection with the acquisition of Elan Corporation, plc ("Elan"). Unless the context requires otherwise, the terms "Perrigo," the "Company," "we," "our," "us," and similar pronouns used herein refer to Perrigo Company plc, its subsidiaries, and all predecessors of Perrigo Company plc and its subsidiaries. We are a leading provider of over-the-counter ("OTC") health and wellness solutions that are designed to enhance individual well-being and empower consumers to proactively prevent or treat conditions that can be self-managed. Our vision is t o make lives better by bringing Quality, Affordable Self-Care Products that consumers trust everywhere they are sold . We are headquartered in Ireland and sell our products primarily in North America and Europe as well as in other markets around the world. Basis of Presentation Our unaudited Condensed Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and footnotes included in our Annual Report on Form 10-K for the year ended December 31, 2022. In the opinion of management, all adjustments considered necessary for a fair presentation of the unaudited Condensed Consolidated Financial Statements have been included and include our accounts and accounts of all majority-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Certain prior period amounts have been reclassified to conform to the current period presentation. Some amounts in this report may not add due to rounding. Segment Reporting Our reporting and operating segments are as follows: • Consumer Self-Care Americas ("CSCA") comprises our consumer self-care business in the U.S. and Canada. CSCA previously included our Latin American businesses until they were disposed on March 9, 2022. • Consumer Self-Care International ("CSCI") comprises our consumer self-care business outside of the U.S. and Canada, primarily in Europe and Australia. We previously had an Rx segment which was comprised of our generic prescription pharmaceuticals business in the U.S., and other pharmaceuticals and diagnostic business in Israel, which have been divested. Following the divestiture, there were no substantial assets or operations left in this segment. The Rx segment was reported as Discontinued Operations in 2021, and is presented as such for all periods in this report (refer to Note 4 ) . Our segments reflect the way in which our chief operating decision maker, who is our CEO, makes operating decisions, allocates resources and manages the growth and profitability of the Company. Financial information related to our business segments and geographic locations can be found in Note 2 and Note 17 . Foreign Currency Translation and Transactions We translate our non-U.S. dollar-denominated operations’ assets and liabilities into U.S. dollars at current rates of exchange as of the balance sheet date and income and expense items at the average exchange rate for the reporting period. Translation adjustments resulting from exchange rate fluctuations are recorded in the cumulative translation account, a component of Accumulated other comprehensive income (loss) ("AOCI"). Gains or losses from foreign currency transactions are included in Other (income) expense, net. Allowance for Credit Losses Expected credit losses on trade receivables and contract assets are measured collectively by geographic location. Historical credit loss experience provides the primary basis for estimation of expected credit losses and is adjusted for current conditions and for reasonable and supportable forecasts. Receivables that do not share risk characteristics are evaluated on an individual basis and are not included in the collective evaluation. The following table presents the allowance for credit losses activity (in millions): Three Months Ended April 1, 2023 April 2, 2022 Balance at beginning of period $ 6.8 $ 7.2 Provision for credit losses, net — 0.3 Receivables written-off (0.3) (0.8) Currency translation adjustment 0.6 0.4 Balance at end of period $ 7.1 $ 7.1 |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Apr. 01, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | REVENUE RECOGNITION The following is a summary of our net sales by category (1) (in millions): Three Months Ended April 1, 2023 April 2, 2022 CSCA Upper Respiratory $ 154.3 $ 152.8 Nutrition 139.9 127.2 Digestive Health 124.2 118.6 Pain and Sleep-Aids 103.5 102.9 Oral Care 84.4 70.4 Healthy Lifestyle 73.4 67.6 Skin Care 52.3 40.9 Women's Health 11.9 8.2 Vitamins, Minerals, and Supplements ("VMS") 4.0 7.7 Other CSCA (2) 15.8 13.7 Total CSCA 763.7 710.0 CSCI Upper Respiratory 84.8 66.5 Skin Care 83.4 73.9 Healthy Lifestyle 66.4 58.9 Pain and Sleep-Aids 49.9 54.0 VMS 47.8 49.5 Women's Health 29.1 13.7 Oral Care 29.1 28.9 Digestive Health 8.8 9.2 Other CSCI (3) 18.8 9.9 Total CSCI 418.1 364.5 Total net sales $ 1,181.7 $ 1,074.5 (1) We updated our global reporting product categories as a result of our product portfolio reconfiguration. These product categories have been adjusted retroactively to reflect the changes and have no impact on historical financial position, results of operations, or cash flows. (2) Consists primarily of product sales and royalty income related to supply and distribution agreements and other miscellaneous or otherwise uncategorized product lines and markets, none of which is greater than 10% of the segment net sales. (3) Consists primarily of our rare diseases business and other miscellaneous or otherwise uncategorized product lines, none of which is greater than 10% of the segment net sales. While the majority of revenue is recognized at a point in time, certain of our product revenue is recognized over time. Customer contracts recognized over time exist predominately in contract manufacturing arrangements, which occur in both the CSCA and CSCI segments. Contract manufacturing revenue was $90.0 million for the three months ended April 1, 2023, and $70.8 million for the three months ended April 2, 2022. We also recognize a portion of the store brand OTC product revenues in the CSCA segment on an over time basis; however, the timing difference between over time and point in time revenue recognition for store brand contracts is not significant due to the short time period between the customization of the product and shipment or delivery. The following table provides information about contract assets from contracts with customers (in millions): Balance Sheet Location April 1, 2023 December 31, 2022 Short-term contract assets Prepaid expenses and other current assets $ 31.7 $ 41.5 We generated net sales in the following geographic locations (1) (in millions): Three Months Ended April 1, 2023 April 2, 2022 U.S. $ 750.0 $ 683.1 Europe (2) 407.3 351.7 All other countries (3) 24.4 39.7 Total net sales $ 1,181.7 $ 1,074.5 (1) The net sales by geography are derived from the location of the entity that sells to a third party. (2) Includes Ireland net sales of $7.3 million and $6.6 million for the three months ended April 1, 2023 and April 2, 2022, respectively. (3) Includes net sales generated primarily in Australia and Canada. |
Acquisitions and Divestitures
Acquisitions and Divestitures | 3 Months Ended |
Apr. 01, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions and Divestitures | ACQUISITIONS AND DIVESTITURES Acquisitions During the Year Ended December 31, 2022 Héra SAS (" HRA Pharma") On April 29, 2022, we completed the previously announced acquisition of 100% of the outstanding equity interest in HRA Pharma for total consideration of €1.8 billion, or approximately $1.9 billion. We funded the transaction with cash on hand and borrowings under our New Senior Secured Credit Facilities (as defined in Note 11 ). The acquisition of HRA Pharma was accounted for as a business combination and has been reported in our Condensed Consolidated Statements of Operations as of the acquisition date. HRA Pharma is a self-care based company with consumer brands such as Compeed ® , ellaOne ® and Mederma ® , as well as a trusted rare disease portfolio. The acquisition completed our transformation to a consumer self-care company. HRA Pharma’s operations are reported in both our CSCA and CSCI segments. We recorded the preliminary purchase price allocation in the second quarter of 2022. During the first quarter of 2023, we recorded measurement period adjustments resulting in an increase to goodwill of $80.6 million, which consisted of a $104.3 million decrease in definite-lived intangibles, $27.2 million decrease in net Deferred income tax liabilities, a net increase of $2.0 million to other non-current liabilities, and a $1.5 million decrease in Prepaid expenses and other current assets. Current period earnings adjustments of $3.5 million to Cost of sales were recorded that would have been recognized during the year-ended December 31, 2022, if the measurement period adjustments to the provisional opening balance sheet were reflected as of the acquisition date. Nestlé’s Gateway Infant Formula Plant and GoodStart ® infant formula brand Acquisition On November 1, 2022, we purchased Nestlé’s Gateway infant formula plant in Eau Claire, Wisconsin, along with the U.S. and Canadian rights to the GoodStart ® infant formula brand ("Gateway"), for $110.0 million in cash, subject to customary post-closing adjustments. The acquisition was accounted for as a business combination and operating results attributable to the products are included in our CSCA segment in the Nutrition product category. We are in the process of finalizing the valuation for the assets acquired. As a result, the initial accounting for the acquisition is incomplete. The provisional acquisition amounts recognized for assets acquired will be finalized as soon as possible but no later than one year from the acquisition date. The final determination may result in asset fair values and tax bases that differ from the preliminary estimates and require changes to the preliminary amounts recognized. Pro Forma Impact of Business Combinations The following table presents unaudited pro forma information as if the HRA Pharma and Gateway acquisitions had occurred on January 1, 2021 and had been combined with the results reported in our Condensed Consolidated Statements of Operations for the three months ended April 2, 2022 (in millions): Three Months Ended (Unaudited) April 2, 2022 Net sales $ 1,209.3 Income (loss) from continuing operations $ 10.8 The unaudited pro forma information is presented for information purposes only and is not indicative of the results that would have been achieved if the acquisition had taken place at such time. The unaudited pro forma information presented above includes adjustments primarily for amortization charges for acquired intangible assets, depreciation of property, plant and equipment that have been revalued, certain acquisition-related charges, and related tax effects. Divestitures During the Year Ended December 31, 2022 Latin American businesses On March 9, 2022, we completed the sale of our Mexico and Brazil-based OTC businesses ("Latin American businesses"), both within our CSCA segment, to Advent International for total consideration of $23.9 million, consisting of $5.4 million in cash, installment receivables due 12 and 18 months from completion totaling $11.3 million based on the Mexican peso exchange rate at the time of sale, and contingent consideration of $7.2 million based on the Brazilian real exchange rate at the time of sale. The sale resulted in a pre-tax loss of $1.4 million, net of professional fees, recorded in Other operating expense, net on the Condensed Consolidated Statements of Operations. ScarAway ® On March 24, 2022, we completed the sale of the ScarAway ® brand asset, a leading U.S. OTC scar management brand, to Alliance Pharmaceuticals Ltd. for cash consideration of $20.7 million. The sale resulted in a pre-tax gain of $3.6 million recorded in our CSCA segment in Other operating expense, net on the Condensed Consolidated Statements of Operations. |
Discontinued Operations
Discontinued Operations | 3 Months Ended |
Apr. 01, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | DISCONTINUED OPERATIONS Our discontinued operations consist of our generic prescription pharmaceuticals business in the U.S. and our pharmaceuticals and diagnostic businesses in Israel (collectively, the “Rx business”). On July 6, 2021, we completed the sale of the Rx business to Altaris Capital Partners, LLC ("Altaris") for aggregate consideration of $1.55 billion. The consideration included a $53.3 million reimbursement related to an Abbreviated New Drug Application (“ANDA") for a generic topical lotion which Altaris delivered in cash to Perrigo pursuant to the terms of the definitive agreement during the three months ended April 2, 2022. Under the terms of a transition services agreement ("TSA"), we provided transition services which were substantially completed as of the end of the third quarter of 2022. We also entered into reciprocal supply agreements pursuant to which Perrigo will supply certain products to the Rx business and the Rx business will supply certain products to Perrigo. The supply agreements have a term of four years, extendable up to seven years by the party who is the purchaser of the products under such agreement. We also extended distribution rights to the Rx business for certain OTC products owned and manufactured by Perrigo that may be fulfilled through pharmacy channels, in return for a share of the net profits. In connection with the sale, Perrigo retained certain pre-closing liabilities arising out of antitrust (refer to Note 16 - Contingencies under the header "Price-Fixing Lawsuits") and opioid matters and the Company’s Albuterol recall, subject to, in each case, Altaris' obligation to indemnify the Company for fifty percent of these liabilities up to an aggregate cap on Altaris' obligation of $50.0 million. We have not requested payments from Altaris related to the indemnity of these liabilities during the three months ended April 1, 2023. |
Inventories
Inventories | 3 Months Ended |
Apr. 01, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | INVENTORIES Major components of inventory were as follows (in millions): April 1, 2023 December 31, 2022 Finished goods $ 674.7 $ 620.3 Work in process 251.1 262.2 Raw materials 257.2 267.8 Total inventories $ 1,183.0 $ 1,150.3 |
Investments
Investments | 3 Months Ended |
Apr. 01, 2023 | |
Investments [Abstract] | |
Investments | INVESTMENTS The following table summarizes the measurement category, balance sheet location, and balances of our equity securities (in millions): Measurement Category Balance Sheet Location April 1, 2023 December 31, 2022 Fair value method Prepaid expenses and other current assets $ 0.1 $ 0.1 Fair value method (1) Other non-current assets $ 1.7 $ 1.7 Equity method Other non-current assets $ 62.7 $ 63.4 (1) Measured at fair value using the Net Asset Value practical expedient. The following table summarizes the expense recognized in earnings of our equity securities (in millions): Three Months Ended Measurement Category Income Statement Location April 1, 2023 April 2, 2022 Fair value method Other expense (income), net $ 0.1 $ 0.2 Equity method Other expense (income), net $ 0.7 $ 0.7 |
Leases
Leases | 3 Months Ended |
Apr. 01, 2023 | |
Leases [Abstract] | |
Leases | LEASES The balance sheet locations of our lease assets and liabilities were as follows (in millions): Assets Balance Sheet Location April 1, 2023 December 31, 2022 Operating Operating lease assets $ 211.7 $ 217.1 Finance Other non-current assets 21.0 22.0 Total $ 232.7 $ 239.1 Liabilities Balance Sheet Location April 1, 2023 December 31, 2022 Current Operating Other accrued liabilities $ 28.3 $ 28.4 Finance Current indebtedness 2.8 3.3 Non-Current Operating Other non-current liabilities 184.7 189.5 Finance Long-term debt, less current portion 16.9 17.4 Total $ 232.7 $ 238.6 The below tables show our lease assets and liabilities by reporting segment (in millions): Assets Operating Financing April 1, 2023 December 31, 2022 April 1, 2023 December 31, 2022 CSCA $ 97.9 $ 100.5 $ 13.5 $ 13.8 CSCI 48.4 49.5 6.5 6.6 Unallocated 65.4 67.1 1.0 1.6 Total $ 211.7 $ 217.1 $ 21.0 $ 22.0 Liabilities Operating Financing April 1, 2023 December 31, 2022 April 1, 2023 December 31, 2022 CSCA $ 99.4 $ 102.2 $ 14.6 $ 14.9 CSCI 51.0 51.7 4.0 4.1 Unallocated 62.6 64.0 1.1 1.7 Total $ 213.0 $ 217.9 $ 19.7 $ 20.7 Lease expense was as follows (in millions): Three Months Ended April 1, 2023 April 2, 2022 Operating leases (1) $ 12.0 $ 9.7 Finance leases Amortization $ 1.1 $ 1.5 Interest 0.1 0.2 Total finance leases $ 1.2 $ 1.7 (1) Includes short-term leases and variable lease costs, which are immaterial. The annual future maturities of our leases as of April 1, 2023 are as follows (in millions): Operating Leases Finance Leases Total 2023 $ 24.7 $ 2.7 $ 27.4 2024 29.5 2.4 31.9 2025 27.6 2.2 29.8 2026 22.4 2.0 24.4 2027 21.7 2.0 23.7 After 2027 117.9 11.6 129.5 Total lease payments 243.8 22.9 266.7 Less: Interest 30.8 3.2 34.0 Present value of lease liabilities $ 213.0 $ 19.7 $ 232.7 Our weighted average lease terms and discount rates are as follows: April 1, 2023 April 2, 2022 Weighted-average remaining lease term (in years) Operating leases 10.85 12.09 Finance leases 9.49 9.28 Weighted-average discount rate Operating leases 2.5 % 2.6 % Finance leases 3.0 % 2.8 % Our lease cash flow classifications are as follows (in millions): Three Months Ended April 1, 2023 April 2, 2022 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows for operating leases $ 9.0 $ 8.5 Operating cash flows for finance leases $ 0.1 $ 0.2 Financing cash flows for finance leases $ 1.0 $ 1.3 Leased assets obtained in exchange for new operating lease liabilities $ 1.4 $ 31.6 |
Leases | LEASES The balance sheet locations of our lease assets and liabilities were as follows (in millions): Assets Balance Sheet Location April 1, 2023 December 31, 2022 Operating Operating lease assets $ 211.7 $ 217.1 Finance Other non-current assets 21.0 22.0 Total $ 232.7 $ 239.1 Liabilities Balance Sheet Location April 1, 2023 December 31, 2022 Current Operating Other accrued liabilities $ 28.3 $ 28.4 Finance Current indebtedness 2.8 3.3 Non-Current Operating Other non-current liabilities 184.7 189.5 Finance Long-term debt, less current portion 16.9 17.4 Total $ 232.7 $ 238.6 The below tables show our lease assets and liabilities by reporting segment (in millions): Assets Operating Financing April 1, 2023 December 31, 2022 April 1, 2023 December 31, 2022 CSCA $ 97.9 $ 100.5 $ 13.5 $ 13.8 CSCI 48.4 49.5 6.5 6.6 Unallocated 65.4 67.1 1.0 1.6 Total $ 211.7 $ 217.1 $ 21.0 $ 22.0 Liabilities Operating Financing April 1, 2023 December 31, 2022 April 1, 2023 December 31, 2022 CSCA $ 99.4 $ 102.2 $ 14.6 $ 14.9 CSCI 51.0 51.7 4.0 4.1 Unallocated 62.6 64.0 1.1 1.7 Total $ 213.0 $ 217.9 $ 19.7 $ 20.7 Lease expense was as follows (in millions): Three Months Ended April 1, 2023 April 2, 2022 Operating leases (1) $ 12.0 $ 9.7 Finance leases Amortization $ 1.1 $ 1.5 Interest 0.1 0.2 Total finance leases $ 1.2 $ 1.7 (1) Includes short-term leases and variable lease costs, which are immaterial. The annual future maturities of our leases as of April 1, 2023 are as follows (in millions): Operating Leases Finance Leases Total 2023 $ 24.7 $ 2.7 $ 27.4 2024 29.5 2.4 31.9 2025 27.6 2.2 29.8 2026 22.4 2.0 24.4 2027 21.7 2.0 23.7 After 2027 117.9 11.6 129.5 Total lease payments 243.8 22.9 266.7 Less: Interest 30.8 3.2 34.0 Present value of lease liabilities $ 213.0 $ 19.7 $ 232.7 Our weighted average lease terms and discount rates are as follows: April 1, 2023 April 2, 2022 Weighted-average remaining lease term (in years) Operating leases 10.85 12.09 Finance leases 9.49 9.28 Weighted-average discount rate Operating leases 2.5 % 2.6 % Finance leases 3.0 % 2.8 % Our lease cash flow classifications are as follows (in millions): Three Months Ended April 1, 2023 April 2, 2022 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows for operating leases $ 9.0 $ 8.5 Operating cash flows for finance leases $ 0.1 $ 0.2 Financing cash flows for finance leases $ 1.0 $ 1.3 Leased assets obtained in exchange for new operating lease liabilities $ 1.4 $ 31.6 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Apr. 01, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | GOODWILL AND INTANGIBLE ASSETS Goodwill Changes in the carrying amount of goodwill, by reportable segment, were as follows (in millions): December 31, 2022 Purchase accounting adjustments Currency translation adjustments April 1, 2023 CSCA (1) $ 2,044.4 $ 35.2 $ — $ 2,079.6 CSCI (2) 1,446.0 45.4 20.2 1,511.6 Total goodwill $ 3,490.4 $ 80.6 $ 20.2 $ 3,591.2 (1) We had accumulated goodwill impairments of $6.1 million as of April 1, 2023 and December 31, 2022. (2) We had accumulated goodwill impairments of $878.4 million as of April 1, 2023 and December 31, 2022. Intangible Assets Intangible assets and related accumulated amortization consisted of the following (in millions): April 1, 2023 December 31, 2022 Gross Accumulated Gross Accumulated Indefinite-lived intangibles: (1) Trademarks, trade names, and brands $ 3.2 $ — $ 3.2 $ — In-process research and development 56.0 — 55.4 — Total indefinite-lived intangibles $ 59.2 $ — $ 58.6 $ — Definite-lived intangibles: Distribution and license agreements and supply agreements $ 95.1 $ 59.2 $ 94.9 $ 58.1 Developed product technology, formulations, and product rights 474.9 218.2 484.8 211.8 Customer relationships and distribution networks 1,844.7 1,006.8 1,825.1 965.9 Trademarks, trade names, and brands 2,462.4 509.0 2,542.2 481.0 Non-compete agreements 2.0 2.0 2.0 2.0 Total definite-lived intangibles $ 4,879.1 $ 1,795.2 $ 4,949.0 $ 1,718.8 Total intangible assets $ 4,938.3 $ 1,795.2 $ 5,007.6 $ 1,718.8 (1) Certain intangible assets are denominated in currencies other than U.S. dollar; therefore, their gross and net carrying values are subject to foreign currency movements. We recorded amortization expense of $65.4 million and $48.5 million for the three months ended April 1, 2023 and April 2, 2022, respectively. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Apr. 01, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS The table below summarizes the valuation of our financial instruments carried at fair value by the applicable pricing categories (in millions): April 1, 2023 December 31, 2022 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Measured at fair value on a recurring basis: Assets: Investment securities $ 0.1 $ — $ — $ 0.1 $ — $ — Foreign currency forward contracts — 3.4 — — 4.2 — Interest rate swap agreements — 24.9 — — 50.5 — Total assets $ 0.1 $ 28.3 $ — $ 0.1 $ 54.7 $ — Liabilities: Cross-currency swap $ — $ 111.3 $ — $ — $ 96.1 $ — Foreign currency forward contracts — 3.1 — — 5.2 — Total liabilities $ — $ 114.4 $ — $ — $ 101.3 $ — There were no transfers within Level 3 fair value measurements during the three months ended April 1, 2023 or the year ended December 31, 2022. Non-recurring Fair Value Measurements The non-recurring fair values represent only those assets whose carrying values were adjusted to fair value during the reporting period. Fixed Rate Long-term Debt Our fixed rate long-term debt consisted of the following (in millions): April 1, 2023 December 31, 2022 Level 1 Level 1 Public Bonds Carrying value (excluding discount) $ 2,544.4 $ 2,544.4 Fair value $ 2,315.0 $ 2,225.4 The fair values of our public bonds for all periods were based on quoted market prices. The fair values of our private placement note for all periods were based on interest rates offered for borrowings of a similar nature and remaining maturities. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 3 Months Ended |
Apr. 01, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES Foreign Currency Option Contracts In September 2021, to economically hedge the foreign currency exposure associated with the planned payment of the euro-denominated purchase price for HRA Pharma, we entered into two non-designated currency option contracts with a total notional amount of $1.1 billion that were scheduled to mature in September 2022. In April 2022, due to market conditions, we unwound the two options and entered into two new undesignated options to economically hedge the purchase price for HRA Pharma for a total notional amount of $2.0 billion. All premiums associated with the HRA Pharma related currency options were settled in April 2022 for $37.1 million. Within Other (income) expense we recorded a $3.5 million loss for the three months ended April 2, 2022. Interest Rate Swaps In April 2022, to economically hedge the interest rate risk of the New Senior Secured Credit Facilities (as defined in Note 11 ), we entered into five variable-to-fixed interest rate swap agreements. Three of the interest rate swaps were designated as cash flow hedges to fix the interest rate on a substantial portion of the 2022 Term Loan B Facility (as defined in Note 11 ). The interest rate swaps cover an interest period ranging from June 1, 2022, through April 1, 2029, on notional balances that decline from $1.0 billion to $812.5 million over the term. The other two interest rate swaps were designated as cash flow hedges to fix the interest rate on a substantial portion of the 2022 Term Loan A Facility (as defined in Note 11 ). The interest rate swaps cover an interest period ranging from June 1, 2022, through April 1, 2027, on notional balances that decline from $487.5 million to $387.5 million over the term. As a designated cash flow hedge, gains and losses will be deferred in AOCI and recognized within Interest expense, net when interest is paid on the New Senior Secured Credit Facilities. Cross-currency Swaps In April 2022, we entered into three fixed-for-fixed cross currency interest rate swaps designated as net investment hedge to hedge the EUR currency exposure of our investment in European operations. In October 2022, we replaced those swaps by entering into three fixed-for-fixed cross currency interest rate swaps at market rates and designated the instruments as net investment hedges on our investment in European operations. The following are the terms and notional amounts outstanding: • $700 million notional amount outstanding from October 25, 2022 through December 15, 2024; • $700 million notional amount outstanding from October 25, 2022 through March 15, 2026; and • $100 million notional amount outstanding from October 25, 2022 through June 15, 2030. Foreign Currency Forwards Notional amounts of foreign currency forward contracts were as follows (in millions): April 1, 2023 December 31, 2022 British Pound (GBP) $ 213.1 $ 224.9 European Euro (EUR) 65.8 61.7 Swedish Krona (SEK) 65.6 56.9 United States Dollar (USD) 54.8 51.7 Chinese Yuan (CNH) 26.5 34.4 Danish Krone (DKK) 26.3 51.7 Canadian Dollar (CAD) 19.7 24.9 Mexican Peso (MXN) 19.4 13.3 Hungarian Forint (HUF) 15.8 10.6 Polish Zloty (PLZ) 15.7 25.2 Norwegian Krone (NOK) 10.5 12.4 Other (1) 26.3 25.9 Total $ 559.5 $ 593.6 (1) Number consists of various currencies notional amounts, none of which individually exceed $10 million in either period presented. The maximum term of our forward currency exchange contracts is 60 months. Effects of Derivatives on the Financial Statements The below tables indicate the effects of all derivative instruments on the Condensed Consolidated Financial Statements. All amounts exclude income tax effects. The balance sheet location and gross fair value of our derivative instruments were as follows (in millions): Balance Sheet Location April 1, 2023 December 31, 2022 Designated derivative assets: Foreign currency forward contracts Prepaid expenses and other current assets $ 1.6 $ 1.1 Interest rate swap agreements Prepaid expenses and other current assets — 3.0 Foreign currency forward contracts Other non-current assets 0.7 0.7 Interest rate swap agreements Other non-current assets 24.9 47.5 Total designated derivative assets $ 27.2 $ 52.3 Non-designated derivative assets: Foreign currency forward contracts Prepaid expenses and other current assets $ 1.1 $ 2.4 Total non-designated derivative assets $ 1.1 $ 2.4 Designated derivative liabilities: Foreign currency forward contracts Other accrued liabilities $ 2.3 $ 4.2 Cross-currency swap Other accrued liabilities 111.3 96.1 Total designated derivative liabilities $ 113.6 $ 100.3 Non-designated derivative liabilities: Foreign currency forward contracts Other accrued liabilities $ 0.8 $ 1.0 The amounts of (income)/expense recognized in earnings related to our non-designated derivatives on the Consolidated Statements of Operations were as follows (in millions): Three months ended Non-Designated Derivatives Income Statement Location April 1, 2023 April 2, 2022 Foreign currency forward contracts Other expense (income), net $ (1.2) $ 0.5 Interest expense, net (0.6) (0.4) $ (1.8) $ 0.1 Foreign currency options Other expense (income), net $ — $ 3.5 The following tables summarize the effect of derivative instruments designated as hedging instruments in AOCI (in millions): Gain/(Loss) Reclassified from AOCI into Earnings Related to Amounts Excluded from Effectiveness Testing Amount Recorded in OCI (1) Classification Amount Classification Amount Recognized in Earnings on Derivatives Three Months Ended April 1, 2023 Cash flow hedges: Interest rate swap agreements $ 24.9 Interest expense, net $ 2.9 Interest expense, net $ — Foreign currency forward contracts (6.7) Net sales 0.4 Net sales — Cost of sales (0.2) Cost of sales — Other (income) expense, net 0.1 Total Cash flow hedges $ 18.2 $ 3.1 $ 0.1 Net investment hedges: Cross-currency swap $ (23.7) Interest expense, net $ (6.5) Three Months Ended April 2, 2022 Cash flow hedges: Interest rate swap agreements $ — Interest expense, net $ (0.5) Interest expense, net $ — Foreign currency forward contracts $ (7.2) Net sales 0.3 Net sales $ — Cost of sales (0.4) Cost of sales $ 0.1 Other expense (income), net $ 0.1 Total Cash flow hedges $ (7.2) $ (0.6) $ 0.2 Net investment hedges: Cross-currency swap $ (4.6) Interest expense, net $ (0.5) (1) Net loss of $1.6 million is expected to be reclassified out of AOCI into earnings during the next 12 months. The classification and amount of gain/(loss) recognized in earnings on fair value and hedging relationships were as follows (in millions): Net Sales Cost of Sales Interest Expense, net Other (Income) Expense, net Three Months Ended April 1, 2023 Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded $ 1,181.7 $ 767.9 $ 43.7 $ 0.5 Gain (loss) on cash flow hedging relationships Foreign currency forward contracts Amount of gain or (loss) reclassified from AOCI into earnings $ 0.4 $ (0.2) $ — $ — Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach $ — $ — $ — $ 0.1 Interest rate swap agreements Amount of gain or (loss) reclassified from AOCI into earnings $ — $ — $ 2.9 $ — Three Months Ended April 2, 2022 Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded $ 1,074.5 $ 736.7 $ 35.8 $ (1.1) Gain (loss) on cash flow hedging relationships Foreign currency forward contracts Amount of gain or (loss) reclassified from AOCI into earnings $ 0.3 $ (0.4) $ — $ — Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach $ — $ 0.1 $ — $ 0.1 Interest rate swap agreements Amount of gain or (loss) reclassified from AOCI into earnings $ — $ — $ (0.5) $ — |
Indebtedness
Indebtedness | 3 Months Ended |
Apr. 01, 2023 | |
Debt Disclosure [Abstract] | |
Indebtedness | INDEBTEDNESS Total borrowings are summarized as follows (in millions): April 1, 2023 December 31, 2022 Term loan 2022 Term loan A due April 20, 2027 490.6 493.8 2022 Term loan B due April 20, 2029 1,091.8 1,094.5 Total term loans 1,582.4 1,588.3 Notes and Bonds Coupon Due 3.900% December 15, 2024 700.0 700.0 4.375% March 15, 2026 700.0 700.0 4.400% June 15, 2030 (1) 750.0 750.0 5.300% November 15, 2043 90.5 90.5 4.900% December 15, 2044 303.9 303.9 Total notes and bonds 2,544.4 2,544.4 Other financing 19.4 20.6 Unamortized premium (discount), net (15.3) (15.9) Deferred financing fees (29.3) (30.8) Total borrowings outstanding 4,101.6 4,106.6 Current indebtedness (38.8) (36.2) Total long-term debt less current portion $ 4,062.8 $ 4,070.4 (1) The coupon rate noted above is as of April 1, 2023, this will increase from 4.400% to 4.650% on payments starting after June 15, 2023, following a credit rating downgrade by Moody's in the first quarter of 2023. Future interest rate adjustments are subject to a 2.0% total cap above the original 3.150% interest rate based on certain rating events as specified in the Note’s Supplemental Indenture No. 3, dated as of June 19, 2020, among Perrigo Finance Unlimited Company, Perrigo Company plc and Wells Fargo Bank, National Association, as trustee. Credit Agreements On April 20, 2022, we and our wholly owned subsidiary, Perrigo Investments, LLC, entered into new senior secured credit facilities consisting of (i) a $1.0 billion five-year revolving credit facility (the “2022 Revolver”), (ii) a $500 million five-year Term Loan A facility (the “2022 Term Loan A Facility”), and (iii) a $1.1 billion seven-year Term Loan B facility (the “2022 Term Loan B Facility” and, together with the 2022 Revolver and 2022 Term Loan A Facility, the “New Senior Secured Credit Facilities”), pursuant to a new Term Loan and Revolving Credit Agreement. The New Senior Secured Credit Facilities are guaranteed, along with any hedging or cash management obligations entered into with a lender, by us and certain of our direct and indirect wholly-owned subsidiaries organized in the United States, Ireland, Belgium and England and Wales (subject to certain exceptions) (the “Guarantor Subsidiaries”). The Guarantor Subsidiaries and Perrigo Investments, LLC provide full and unconditional guarantees, jointly and severally, on a senior unsecured basis, of the 5.300% Notes due 2043 issued by the Company, and the Guarantor Subsidiaries, Perrigo Investments, LLC and the Company provide full and unconditional guarantees, jointly and severally, on a senior unsecured basis, of the 3.900% Notes due 2024, the 4.375% Notes due 2026, the 4.400% Notes due 2030 and the 4.900% Notes due 2044 issued by Perrigo Finance Unlimited Company. The Credit Agreement also contains customary representations and warranties and customary affirmative and negative covenants applicable to the Borrower and its restricted subsidiaries, including, among other things, restrictions on indebtedness, liens, investments, mergers, dispositions, prepayment of junior indebtedness and dividends and other distributions. The Credit Agreement contains financial covenants that require the Borrower and its restricted subsidiaries to (a) not exceed a maximum first lien secured net leverage ratio of 3.00 to 1.00 at the end of each fiscal quarter and (b) not fall below a minimum interest coverage ratio of 3.00 to 1.00 at the end of each fiscal quarter, provided that such covenants apply only to the 2022 Revolver and the 2022 Term Loan A Facility. If we consummate certain qualifying acquisitions during the term of the loan, the maximum first lien secured net leverage ratio covenant would increase to 3.25 to 1.00 for such quarter and the three following fiscal quarters thereafter. The Credit Agreement also contains customary events of default relating to, among other things, failure to make payments, breach of covenants and breach of representations. During the three months ended April 1, 2023, principal repayments o f $5.9 million were made on the 2022 Term Loan A Facility and 2022 Term Loan B Facility. There we re no borrowings outstanding under the 2022 Revolver as of April 1, 2023 or December 31, 2022, respectively. We are in compliance with all the covenants under our debt agreements as of April 1, 2023. Other Financing We have overdraft facilities available that we use to support our cash management operations. We report any balances outstanding under such facilities in the above table under "Other financing". Th ere were no borrowings o utstanding under the overdraft facilities as of April 1, 2023 or December 31, 2022. We have financing leases that are reported in the above table under "Other financing" (refer to Note 7 ). |
Earnings Per Share and Sharehol
Earnings Per Share and Shareholders' Equity | 3 Months Ended |
Apr. 01, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share and Shareholders' Equity | EARNINGS PER SHARE AND SHAREHOLDERS' EQUITY Earnings per Share A reconciliation of the numerators and denominators used in our basic and diluted earnings per share ("EPS") calculation is as follows (in millions): Three Months Ended April 1, 2023 April 2, 2022 Numerator: Income (loss) from continuing operations $ (1.1) $ (1.3) Income (loss) from discontinued operations, net of tax (1.9) (1.1) Net income (loss) $ (3.0) $ (2.4) Denominator: Weighted average shares outstanding for basic EPS 134.9 134.0 Weighted average shares outstanding for diluted EPS (1) 134.9 134.0 Anti-dilutive share-based awards excluded from computation of diluted EPS (1) — — (1) In the period of a net loss from continuing operations, diluted shares equal basic shares. Shareholders' Equity |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Apr. 01, 2023 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) Changes in our AOCI balances, net of tax were as follows (in millions): Fair Value of Derivative Financial Instruments, net of tax Foreign Currency Translation Adjustments Post-Employment Plan Adjustments, net of tax (1) Total AOCI Balance at December 31, 2022 $ 24.5 $ (58.6) $ 7.1 $ (27.0) OCI before reclassifications (28.4) 52.7 (0.5) 23.8 Amounts reclassified from AOCI (3.1) — — (3.1) Other comprehensive income (loss) $ (31.5) $ 52.7 $ (0.5) $ 20.7 Balance at April 1, 2023 $ (7.0) $ (5.9) $ 6.6 $ (6.3) |
Restructuring Charges
Restructuring Charges | 3 Months Ended |
Apr. 01, 2023 | |
Restructuring Charges [Abstract] | |
Restructuring Charges | RESTRUCTURING CHARGES We periodically take action to reduce redundant expenses and improve operating efficiencies. Restructuring activity includes severance, lease exit costs, and related consulting fees. The following reflects our restructuring activity (in millions): Three Months Ended April 1, 2023 April 2, 2022 Supply Chain Reinvention HRA Pharma Integration Other Initiatives Total Total Beginning balance $ 2.2 $ 13.3 $ 4.3 $ 19.8 $ 6.9 Additional charges 2.6 0.8 $ — 3.4 3.6 Payments (4.4) (2.6) $ (1.0) (8.0) (2.1) Non-cash adjustments — 0.3 $ 0.1 0.4 (0.2) Ending balance $ 0.4 $ 11.8 $ 3.4 $ 15.6 $ 8.2 The charges incurred during the three months ended April 1, 2023 and April 2, 2022 were primarily associated with actions taken on our multi-year supply chain restructuring program initiative started in 2022, and HRA Pharma integration activities associated with employee separation, continuity and other benefit-related costs. We have incurred $13.5 million of cumulative restructuring expense to date related to HRA Pharma integration. We expect that most of the HRA Pharma integration expenses will be incurred by the end of 2023. Of the amount recorded during the three months ended April 1, 2023, $0.9 million was related to our CSCI segment, due primarily to supply chain restructuring and HRA Pharma integration initiatives, and $1.2 million related to our CSCA segment, also due primarily to supply chain restructuring initiatives. Remaining amounts recorded, including $3.6 million recorded during the three months ended April 2, 2022, related to our Unallocated segment due primarily to supply chain restructuring. There were no other material restructuring programs for the periods presented. All charges are recorded in Restructuring expense on the Condensed Consolidated Statements of Operations. The remaining $15.6 million liability for employee severance benefits and consulting fees is expected to be paid within the next year. |
Income Taxes
Income Taxes | 3 Months Ended |
Apr. 01, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES The effective tax rates were as follows: Three Months Ended April 1, 2023 April 2, 2022 123.8 % 90.2 % The effective tax rate on the pre-tax income for the three months ended April 1, 2023 increased compared to the effective tax rate on the pre-tax loss for the three months ended April 2, 2022, primarily due to the tax benefit of the loss on sale of our Latin American businesses recognized in the three months ended April 2, 2022, offset by changes in the jurisdictional mix of earnings in the three months ended April 1, 2023. The effective tax rate for this period differs from the statutory income tax rate of 12.5% primarily due to non-deductible expenses, as well as changes in our reserves for unrecognized tax benefits. Internal Revenue Service Audits of Perrigo Company, a U.S. Subsidiary Perrigo Company, our U.S. subsidiary ("Perrigo U.S."), is engaged in a series of tax disputes in the U.S. relating primarily to transfer pricing adjustments including income in connection with the purchase, distribution, and sale of store-brand OTC pharmaceutical products in the United States, including the generic heartburn medication omeprazole. On August 27, 2014, we received a statutory notice of deficiency from the IRS relating to our fiscal tax years ended June 27, 2009, and June 26, 2010 (the “2009 tax year” and “2010 tax year”, respectively). On April 20, 2017, we received a statutory notice of deficiency from the IRS for the years ended June 25, 2011 and June 30, 2012 (the “2011 tax year” and “2012 tax year”, respectively). Specifically, both statutory notices proposed adjustments related to the offshore reporting of profits on sales of omeprazole in the United States resulting from the assignment of an omeprazole distribution contract to an Israeli affiliate. In addition to the transfer pricing adjustments, which applied to all four tax years, the statutory notice of deficiency for the 2011 and 2012 tax years included adjustments requiring the capitalization and amortization of certain legal expenses that were deducted when paid or incurred in defending against certain patent infringement lawsuits related to ANDAs filed with a Paragraph IV Certification. We do not agree with the audit adjustments proposed by the IRS in either of the notices of deficiency. We paid the assessed amounts of tax, interest, and penalties set forth in the statutory notices and timely filed claims for refund on June 11, 2015 for the 2009 and 2010 tax years, and on June 7, 2017, for the 2011 and 2012 tax years. On August 15, 2017, following disallowance of such refund claims, we timely filed a complaint in the United States District Court for the Western District of Michigan seeking refunds of tax, interest, and penalties of $27.5 million for the 2009 tax year, $41.8 million for the 2010 tax year, $40.1 million for the 2011 tax year, and $24.7 million for the 2012 tax year, for a total of $134.1 million, plus statutory overpayment interest thereon from the dates of payment. The amounts sought in the complaint for the 2009 and 2010 tax years were recorded as deferred charges in Other non-current assets on our balance sheet during the three months ended March 28, 2015, and the amounts sought in the complaint for the 2011 and 2012 tax years were recorded as deferred charges in Other non-current assets on our balance sheet during the three months ended July 1, 2017. A bench trial was held during the period May 25, 2021 to June 7, 2021 for the refund case in the United States District Court for the Western District of Michigan. The total amount of cumulative deferred charge that we are seeking to receive in this litigation is approximately $111.6 million, which reflects the impact of conceding that Perrigo U.S. should have received a 5.24% royalty on all omeprazole sales. That concession was previously paid and is the subject of the above refund claims. The issues outlined in the statutory notices of deficiency described above are continuing in nature, and the IRS will likely carry forward the adjustments set forth therein as long as the drug is sold, in the case of the omeprazole issue, and for all post-2012 Paragraph IV filings that trigger patent infringement suits, in the case of the ANDA issue. Post-trial briefings were completed on September 24, 2021 and the case is now fully submitted for the court’s decision. On April 30, 2021, we filed a Notice of New Authority in our refund case in the Western District of Michigan alerting the court to a United States Tax Court decision in Mylan v. Comm'r that ruled in favor of the taxpayer on nearly identical ANDA issues as we have before the court. On January 28, 2022, the IRS filed a Notice of Appeal with the United States Court of Appeals of the Third Circuit to appeal the United States Tax Court's decision in Mylan v. Comm'r. Briefing to the appellate court was completed during 2022, oral argument was held before the Third Circuit on January 12, 2023, and the case is awaiting decision. On August 22, 2022, the parties filed a Notice of New Authority in the refund case alerting the court to a United States Court of Federal Claims decision in Actavis Laboratories v. United States that also ruled in favor of the taxpayer on the ANDA issues. The government appealed the Actavis Laboratories decision to the United States court of Appeals for the Federal Circuit in December of 2022 and briefing to the appellate court is ongoing. On January 13, 2021, the IRS issued a 30-day letter and Revenue Agent's Report ("RAR") with respect to its audit of our fiscal tax years ended June 29, 2013, June 28, 2014, and June 27, 2015. The 30-day letter proposed, among other modifications, transfer pricing adjustments in connection with the distribution of omeprazole in the aggregate amount of $141.6 million and ANDA-related adjustments in the aggregate amount of $21.9 million. The 30-day letter also set forth adjustments described in the next two paragraphs. We timely filed a protest to the 30-day letter for those additional adjustments but noting that due to the pending refund litigation described above, IRS Appeals would not consider the merits of the omeprazole or ANDA matters. We believe that we should prevail on the merits on both carryforward issues and have reserved for taxes and interest payable on the 5.24% deemed royalty on omeprazole through the tax year ended December 31, 2018. Beginning with the tax year ended December 31, 2019, we began reporting income commensurate with the 5.24% deemed royalty. We have not reserved for the ANDA-related issue described above. While we believe we should prevail on the merits of this case, the outcome remains uncertain. If our litigation position on the omeprazole issue is not sustained, the outcome for the 2009–2012 tax years could range from a reduction in the refund amount to denial of any refund. In addition, we expect that the outcome of the refund litigation could effectively bind future tax years. In that event, an adverse ruling on the omeprazole issue could have a material impact on subsequent periods, with additional tax liability in the range of $24.0 million to $112.0 million, not including interest and any applicable penalties. The 30-day letter for the 2013-2015 tax years also proposed to reduce Perrigo U.S.'s deductible interest expense for the 2014 tax year and the 2015 tax year on $7.5 billion in certain intercompany debts owed by it to Perrigo Company plc, which is the subject matter of a Notice of Proposed Adjustment, or "NOPA" issued on May 7, 2020. Subsequent to the end of the first quarter of fiscal 2023, we finalized an agreement with IRS Appeals providing for settlement of the NOPA. Refer to Note 18 - Subsequent Events for additional details. In addition, the 30-day letter for the 2013-2015 tax years expanded on a NOPA issued on December 11, 2019 and proposed to disallow reductions to gross sales income on the sale of prescription products to wholesalers for accrued wholesale customer pipeline chargebacks where the prescription products were not re-sold by such wholesalers to covered retailers by the end of the tax year. On December 28, 2022, we finalized an agreement with IRS Appeals providing for settlement of the December 11, 2019 NOPA, which would not only cover the 2013-2015 tax years but all of the remaining tax years through 2021, the last tax year with chargebacks due to the sale of the Rx business in July 2021. We made a settlement payment of $8.3 million in 2022 which was fully covered by reserves for this issue. On December 2, 2021, the IRS commenced an audit of our federal income tax returns for the tax years ended December 31, 2015, through December 31, 2019. Internal Revenue Service Audit of Athena Neurosciences, Inc., a U.S. Subsidiary Subsequent to the end of the first quarter of fiscal 2023, we were notified by the IRS regarding the Competent Authority request filed for the Tysabri royalty issue, which concludes the competent authority process without the need for negotiations between the competent authorities and constitutes a full and final resolution of the April 26, 2019 NOPA received by Athena Neurosciences, Inc. Refer to Note 18 - Subsequent Events . for additional details. Although we believe that our tax estimates are reasonable and that we prepare our tax filings in accordance with all applicable tax laws, the final determination with respect to any tax audit and any related litigation could be materially different from our estimates or from our historical income tax provisions and accruals. The results of an audit or litigation could have a material effect on operating results and/or cash flows in the periods for which that determination is made. In addition, future period earnings may be adversely impacted by litigation costs, settlements, penalties, and/or interest assessments. Based on the final resolution of tax examinations, judicial or administrative proceedings, changes in facts or law, expirations of statute of limitations in specific jurisdictions or other resolutions of, or changes in, tax positions - one or more of which may occur within the next twelve months - it is reasonably possible that unrecognized tax benefits for certain tax positions taken on previously filed tax returns may change materially from those recorded as of April 1, 2023. However, we are not able to estimate a reasonably possible range of how these events may impact our unrecognized tax benefits in the next twelve months. |
Contingencies
Contingencies | 3 Months Ended |
Apr. 01, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | CONTINGENCIES In view of the inherent difficulties of predicting the outcome of various types of legal proceedings, we cannot determine the ultimate resolution of the matters described below. We establish reserves for litigation and regulatory matters when losses associated with the claims become probable and the amounts can be reasonably estimated. The actual costs of resolving legal matters may be substantially higher or lower than the amounts reserved for those matters. For matters where the likelihood or extent of a loss is not probable or cannot be reasonably estimated as of April 1, 2023, we have not recorded a loss reserve. If certain of these matters are determined against us, there could be a material adverse effect on our financial condition, results of operations, or cash flows. We currently believe we have valid defenses to the claims in these lawsuits and intend to defend these lawsuits vigorously regardless of whether or not we have a loss reserve. Other than what is disclosed below, we do not expect the outcome of the litigation matters to which we are currently subject to, individually or in the aggregate, have a material adverse effect on our financial condition, results of operations, or cash flows. Price-Fixing Lawsuits Beginning in 2013, the Company, along with other manufacturers, has been named as a defendant in lawsuits in the United States and Canada generally alleging anticompetitive conduct with respect to the sale of generic drugs by the Company’s former Rx business. The complaints – which have been filed by putative classes of direct purchasers, end payors, and indirect resellers, as well as individual direct and indirect purchasers and certain cities and counties - allege a conspiracy to fix, maintain, stabilize, and/or raise prices, rig bids, and allocate markets or customers for various generic drugs in violation of federal and state antitrust and consumer protection laws. While most of the complaints involve alleged single-drug conspiracy, the three putative classes have each filed an over- arching conspiracy complaint alleging that Perrigo and other manufacturers (and some individuals) entered into an “overarching conspiracy” that involved allocating customers, rigging bids, and raising, maintaining, and fixing prices for various products. The vast majority of the lawsuits described in this paragraph have been consolidated in the generic pricing multidistrict litigation ("MDL") MDL No. 2724 (United States District Court for Eastern District of Pennsylvania). The Court has ordered that the following cases involving Perrigo will proceed on a more expedited basis (as a bellwether) than the other cases in MDL No. 2724: (i) class actions alleging “single drug” conspiracies involving Clobetasol; and (ii) the State Attorney General Complaint (described below). The bellwether cases are proceeding in discovery, which must be completed by June 1, 2023 under the schedule set by the Court, and motions for summary judgment will be due on March 13, 2024. No trial dates have been set for any of the bellwether cases, or any of the other cases in the MDL. State Attorney General Complaint On June 10, 2020, the Connecticut Attorney General’s office filed a lawsuit on behalf of Connecticut and 50 other states and territories against Perrigo, 35 other generic pharmaceutical manufacturers, and certain individuals (including two former Perrigo employees), alleging an overarching conspiracy to allocate customers and/or fix, raise, or stabilize prices of eighty products. This case is included among the “bellwether cases” designated to follow the expedited schedule described above. Like the other cases in the MDL, no trial date has been set for this case. Canadian Class Action Complaint In June 2020, an end payor filed a class action in Ontario, Canada against Perrigo and 29 other manufacturers alleging an overarching conspiracy to allocate customers and/or fix, raise, or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other MDL complaints naming Perrigo: Clobetasol, Desonide, Econazole, and Nystatin. In December 2020, Plaintiffs amended their complaint to add additional claims based on the State Attorney General Complaint of June 2020. At this stage, we cannot reasonably estimate the outcome of the liability if any, associated with the claims listed above. Securities Litigation In the United States (cases related to events in 2015-2017) Beginning in May 2016, purported class action complaints were filed against the Company and our former CEO, Joseph Papa, in the U.S. District Court for the District of New Jersey ( Roofers’ Pension Fund v. Papa, et al. ) purporting to represent a class of shareholders for the period from April 21, 2015 through May 11, 2016, inclusive. The original complaint alleged violations of federal securities laws in connection with the actions taken by us and the former executive to defend against the unsolicited takeover bid by Mylan in the period from April 21, 2015 through November 13, 2015. The plaintiff also alleged that the defendants provided inadequate disclosure concerning alleged business developments during the alleged class period including integration problems related to the Omega acquisition. The operative complaint is the first amended complaint filed on June 21, 2017, and named as defendants us and 11 current or former directors and officers of Perrigo (Mses. Judy Brown, Laurie Brlas, Jacqualyn Fouse, Ellen Hoffing, and Messrs. Joe Papa, Marc Coucke, Gary Cohen, Michael Jandernoa, Gerald Kunkle, Herman Morris, and Donal O’Connor). The amended complaint alleges violations of federal securities laws arising out of the actions taken by us and the former directors and executives to defend against the unsolicited takeover bid by Mylan in the period from April 21, 2015 through November 13, 2015 and the allegedly inadequate disclosure throughout the entire class period related to the business developments during that period including purported integration problems related to the Omega acquisition, alleges incorrect reporting of organic growth at the Company and at Omega, alleges price fixing activities with respect to six generic prescription pharmaceuticals, and alleges improper accounting for the Tysabri ® royalty stream. During 2017, the defendants filed motions to dismiss, which the plaintiffs opposed. On July 27, 2018, the court issued an opinion and order granting the defendants’ motions to dismiss in part and denying the motions to dismiss in part. The court dismissed without prejudice defendants Laurie Brlas, Jacqualyn Fouse, Ellen Hoffing, Gary Cohen, Michael Jandernoa, Gerald Kunkle, Herman Morris, Donal O’Connor, and Marc Coucke. The court also dismissed without prejudice claims arising from the Tysabri ® accounting issue described above and claims alleging incorrect disclosure of organic growth described above. The defendants who were not dismissed are the Company, Joe Papa, and Judy Brown. The claims (described above) that were not dismissed relate to the integration issue regarding the Omega acquisition, the defense against the Mylan tender offer, and the alleged price fixing activities with respect to six generic prescription pharmaceuticals. The defendants who remain in the case (us, Mr. Papa, and Ms. Brown) have filed answers denying liability. On November 14, 2019, the court granted the lead plaintiffs’ motion and certified three classes for the case: (i) all those who purchased shares between April 21, 2015 through May 2, 2017 inclusive on a U.S. exchange and were damaged thereby; (ii) all those who purchased shares between April 21, 2015 through May 2, 2017 inclusive on the Tel Aviv exchange and were damaged thereby; and (iii) all those who owned shares as of November 12, 2015 and held such stock through at least 8:00 a.m. on November 13, 2015 (whether or not a person tendered shares in response to the Mylan tender offer) (the "tender offer class"). Plaintiffs' counsels have sent notices to the alleged class. The parties took discovery from 2018 through 2020. After discovery ended, defendants filed motions for summary judgement and to exclude plaintiffs' experts, which were fully briefed. The case was then re-assigned to a new federal judge, who heard oral argument on the motions in April 2022. The motions are pending. In addition to the class action, the following opt-out cases have been filed against us, and in some cases, Mr. Papa and Ms. Brown, and contain factual allegations and claims that are similar to some or all of the factual allegations and claims in the class actions: Case Date Filed Carmignac Gestion, S.A. v. Perrigo Company plc, et al. 11/1/2017 First Manhattan Co. v. Perrigo Company plc, et al. 2/16/2018; amended 4/20/2018 Nationwide Mutual Funds, et al. v. Perrigo Company plc, et al. 10/29/2018 Schwab Capital Trust, et al. v. Perrigo Company plc, et al. 1/31/2019 Aberdeen Canada Funds -- Global Equity Fund, et al. v. Perrigo Company plc, et al. 2/22/2019 Principal Funds, Inc., et al. v. Perrigo Company plc, et al. 3/5/2020 Kuwait Investment Authority, et al. v. Perrigo Company plc, et al. 3/31/2020 Mason Capital L.P., et al. v. Perrigo Company plc, et al. 1/26/2018 Pentwater Equity Opportunities Master Fund Ltd., et al. v. Perrigo Company plc, et al. 1/26/2018 WCM Alternatives: Event-Drive Fund, et al. v. Perrigo Co., plc, et al. 11/15/2018 Hudson Bay Master Fund Ltd., et al. v. Perrigo Co., plc, et al. 11/15/2018 Discovery Global Citizens Master Fund, Ltd., et al. v. Perrigo Co. plc, et al. 12/18/2019 York Capital Management, L.P., et al. v. Perrigo Co. plc, et al. 12/20/2019 Burlington Loan Management DAC v. Perrigo Co. plc, et al. 2/12/2020 Universities Superannuation Scheme Limited v. Perrigo Co. plc, et al. 3/2/2020 Harel Insurance Company, Ltd., et al. v. Perrigo Company plc, et al. 2/13/2018 TIAA-CREF Investment Management, LLC., et al. v. Perrigo Company plc, et al. 4/20/2018 Sculptor Master Fund (f/k/a OZ Master Fund, Ltd.), et al. v. Perrigo Company plc, et al. 2/6/2019 BlackRock Global Allocation Fund, Inc., et al. v. Perrigo Co. plc, et al. 4/21/2020 Starboard Value and Opportunity C LP, et al. v. Perrigo Company plc, et al. 2/25/2021 In June 2020, three Highfields Capital entities filed a lawsuit in Massachusetts State Court with factual allegations that generally were similar to the factual allegations in the Amended Complaint in the Roofers' Pension Fund case described above, except that the Highfields plaintiffs did not include allegations about alleged collusive pricing of generic prescription drugs, and alleged Massachusetts state law claims under the Massachusetts Unfair Business Methods Law (chapter 93A) and Massachusetts common law claims of tortious interference with prospective economic advantage, common law fraud, negligent misrepresentation, and unjust enrichment. In December 2021, the Massachusetts State Court granted Defendants’ motion to dismiss in part and denied it in part. Defendants’ filed their answers in January 2022 denying liability. The discovery phase in this case has begun (including discovery related to some factual allegations that were not part of the discovery in the actions in New Jersey federal court). The Court held a discovery conference and approved fact discovery deadlines into May 2023 and later deadlines to complete expert discovery. Subsequently, the Court held a further conference in March 2023 and revised the schedule with fact discovery ending in October 2023 and expert discovery in May 2024. In Israel (cases related to events in 2015-2017) On June 28, 2017, a plaintiff filed a complaint in Tel Aviv District Court styled Israel Elec. Corp. Employees’ Educ. Fund v. Perrigo Company plc, et al. The lead plaintiff seeks to represent a class of shareholders who purchased Perrigo stock on the Tel Aviv exchange during the period from April 24, 2015 through May 3, 2017 and also a claim for those that owned shares on the final day of the Mylan tender offer (November 13, 2015). The amended complaint names as defendants the Company, Ernst & Young LLP (the Company’s auditor), and 11 current or former directors and officers of Perrigo (Mses. Judy Brown, Laurie Brlas, Jacqualyn Fouse, Ellen Hoffing, and Messrs. Joe Papa, Marc Coucke, Gary Cohen, Michael Jandernoa, Gerald Kunkle, Herman Morris, and Donal O’Connor). The complaint alleges violations under Israeli securities laws that are similar to U.S. Securities Exchange Act sections 10(b) (and Rule 10b‑5) and 14(e) against all defendants and 20(a) control person liability against the 11 individuals or, in the alternative, under other Israeli securities laws. In general, the allegations are similar to the factual allegations in the Roofers' Pension Fund case in the U.S. as described above. The plaintiff indicates an initial, preliminary class damages estimate of 2.7 billion NIS (approximately $760.0 million at 1 NIS = 0.28 cents). After the other two cases filed in Israel were voluntarily dismissed, the plaintiff in this case agreed to stay this case pending the outcome of the Roofers’ Pension Fund case in the U.S. (described above). The Israeli court approved the stay, and this case is now stayed. We intend to defend the lawsuit vigorously. In Israel (case related to Irish Tax events) On December 31, 2018, a shareholder filed an action against the Company, our CEO Murray Kessler, and our former CFO Ronald Winowiecki in Tel Aviv District Court ( Baton v. Perrigo Company plc, et. al. ). The case is a securities class action brought in Israel making similar factual allegations for the same period as those asserted in a securities class action case (for those who purchased on a U.S. exchange) in New York federal court in which the settlement received final approval in February 2022. The Baron case alleges that persons who purchased securities through the Tel Aviv stock exchange and suffered damages can assert claims under Israeli securities law that will follow the liability principles of Sections 10(b) and 20(a) of the U.S. Securities Exchange Act. The plaintiff does not provide an estimate of class damages. Since 2019, the court granted several requests by Perrigo to stay the proceedings pending the resolution of proceedings in the New York federal court. During 2022, the case was reassigned to a newly-appointed judge. After the settlement of the U.S. case in New York federal court, Perrigo's counsel informed the Israeli Court of the final approval of the settlement of the U.S. case. The parties then sought further stays of the case while they attempted mediation, which the Court granted. In April 2023, the parties reported to the Court that the mediation had led to a preliminary agreement on settlement; the Court ordered that a motion for approval of the settlement and related papers be filed no later than June 17, 2023. Other Matters Talcum Powder The Company has been named, together with other manufacturers, in product liability lawsuits in a variety of state courts alleging that the use of body powder products containing talcum powder causes mesothelioma and lung cancer due to the presence of asbestos. All but one of these cases involve legacy talcum powder products that have not been manufactured by the Company since 1999. One of the pending actions involves a current prescription product that contains talc as an excipient. As of April 24, 2023, the Company is currently named in 90 individual lawsuits seeking compensatory and punitive damages and has accepted a tender for a portion of the defense costs and liability from a retailer for one additional matter. The Company has several defenses and intends to aggressively defend these lawsuits. Trials for these lawsuits are currently scheduled throughout 2023, 2024 and 2025, with the earliest trial date in May 2023. Ranitidine After regulatory bodies announced worldwide that ranitidine may potentially contain N-nitrosodimethylamine ("NDMA"), a known environmental contaminant, the Company promptly began testing its externally-sourced ranitidine API and ranitidine-based products. On October 8, 2019, the Company halted shipments of the product based upon preliminary results and on October 23, 2019, the Company made the decision to conduct a voluntary retail market withdrawal. In February 2020, the resulting actions involving Zantac ® and other ranitidine products were transferred for coordinated pretrial proceedings to a Multi-District Litigation (In re Zantac ® /Ranitidine Products Liability Litigation MDL No. 2924) in the U.S. District Court for the Southern District of Florida. After the Company successfully moved to dismiss the first set of Master Complaints in the MDL, it now includes three: 1) an Amended Master Personal Injury Complaint; 2) a Consolidated Amended Consumer Economic Loss Class Action Complaint; and 3) a Consolidated Medical Monitoring Class Action Complaint. All three name the Company. Plaintiffs appealed one of the original Master Complaints, the Third-Party Payor Complaint, and two individual plaintiffs appealed their individual personal injury claims on limited grounds. The Company is not named in the appeals. On June 30, 2021, the Court dismissed all claims against the retail and distributor defendants with prejudice, thereby reducing the Company’s potential for exposure and liability related to possible indemnification. On July 8, 2021, the Court dismissed all claims against the Company with prejudice. Appeals of these dismissal orders to the U.S. Court of Appeals for the 11th Circuit have been filed, as well as several state level claims related to the theories advanced in the MDL litigation. The Company will continue to vigorously defend each of these lawsuits. As of April 1, 2023, the Company has been named in 352 personal injury lawsuits, most of which are in the MDL tied to various federal courts alleging that plaintiffs developed various types of cancers or are placed at higher risk of developing cancer as a result of ingesting products containing ranitidine. The Company has also been named in a handful of similar lawsuits in the state courts of California, Illinois, Ohio, New Jersey, New York and Pennsylvania. The Company is named in these lawsuits with manufacturers of the national brand Zantac ® and other manufacturers of ranitidine products, as well as distributors, repackagers, and/or retailers. Plaintiffs seek compensatory and punitive damages, and in some instances seek applicable remedies under state consumer protection laws. The Company believes that it has strong defenses to such claims based on a significant body of scientific evidence, and pursuant to the doctrine of federal preemption. As noted above, the Company has won multiple motions to dismiss in the MDL, as well as additional state court actions in California and Maryland. The Company has also been named in a Complaint brought by the New Mexico Attorney General based on the following theories: violation of a New Mexico public nuisance statute, NMSA 30-8-1 to -14; common law nuisance; and negligence and gross negligence. The Company is named in this lawsuit with manufacturers of the national brand Zantac ® and other manufacturers of ranitidine products and/or retailers. Brand name manufactures named in the lawsuit also face claims under the state’s Unfair Practices & False Advertising acts. The Company filed motions to dismiss the action. The New Mexico District Court denied the Company’s Motion to Dismiss and litigation continues. The Company will continue to vigorously defend this lawsuit. Some of the Company’s retailer customers are seeking indemnity from the Company for a portion of their defense costs and liability relating to these cases. Acetaminophen In October 2022 the Judicial Panel on Multidistrict Litigation ("MDL") consolidated a number of pending actions filed in various federal courts alleging that prenatal exposure to acetaminophen is purportedly associated with the development of autism spectrum disorder (“ASD”) and attention-deficit/hyperactivity disorder (“ADHD”). The MDL is styled In re: Acetaminophen – ASD/ADHD Products Liability Litigation (MDL No. 3043) and is pending before the U.S. District Court for the Southern District of New York. Plaintiffs in the MDL have asserted claims against Johnson & Johnson Consumer, Inc. (“JJCI”) and various retailer chains alleging that plaintiff-mothers took acetaminophen products while pregnant and that plaintiff-children developed ASD and/or ADHD as a result of prenatal exposure to these acetaminophen products. At this time, the MDL proceedings are in the early stages. Currently, it is not possible to assess reliably the outcome of these cases or any potential future financial impact on the Company. As of April 24, 2023 the Company has not been named as a defendant in any Complaints filed in the MDL. It is anticipated that some of the Company’s retailer customers may seek indemnity from the Company for a portion of their defense costs and potential liability relating to these cases. Contingencies Accruals As a result of the matters discussed in this Note, the Company has established a loss accrual for litigation contingencies where we believe a loss to be probable and for which an amount of loss can be reasonably estimated. However, we cannot determine a reasonable estimate of the maximum possible loss or range of loss for these matters given that they are at various stages of the litigation process and each case is subject to inherent uncertainties of litigation. At April 1, 2023, the loss accrual for litigation contingencies reflected on the balance sheet in Other accrued liabilities was approximately $67.6 million. The Company also recorded an insurance recovery receivable reflected on the balance sheet in Prepaid expenses and other current assets of approximately $37.2 million related to these litigation contingencies because it believes such amount is recoverable based on communications with its insurers to date; however, the Company may erode this insurance receivable as it incurs defense costs associated with defending the matters. The Company’s management believes these accruals for contingencies are reasonable and sufficient based upon information currently available to management; however, there can be no assurance that final costs related to these contingencies will not exceed current estimates or that all of the final costs related to these contingencies will be covered by insurance. (See " Insurance Coverage Litigation ," below.) In addition, we have other litigation matters pending for which we have not recorded any accruals because our potential liability for those matters is not probable or cannot be reasonably estimated based on currently available information. For those matters where we have not recorded an accrual but a loss is reasonably possible, we cannot determine a reasonable estimate of the maximum possible loss or range of loss for these matters given that they are at various stages of the litigation process and each case is subject to the inherent uncertainties of litigation. Insurance Coverage Litigation In May 2021, insurers on multiple policies of D&O insurance filed an action in the High Court in Dublin against the Company and multiple current and former directors and officers of the Company seeking declaratory judgments on certain coverage issues. Those coverage issues include claims that policies for periods beginning in December 2015 and December 2016, respectively, do not have to provide coverage for the securities actions described above pending in the District of New Jersey or in Massachusetts state court concerning the events of 2015-2017. The policy for the period beginning December 2014 is currently providing coverage for those matters, and the litigation would not affect that existing coverage. However, if the plaintiffs are successful, the total amount of insurance coverage available to defend such lawsuits and to satisfy any judgment or settlement costs thereunder would be limited to one policy period. The insurers’ lawsuit also challenges coverage for Krueger derivatively on behalf of nominal defendant Perrigo Company plc v. Alford et al., a prior derivative action filed in the District of New Jersey that was dismissed in August 2020, and for the counterclaims brought in the Omega arbitration proceedings. Perrigo responded on November 1, 2021; Perrigo’s response includes its position that the policies for the periods beginning December 2015 and December 2016 provide coverage for the underlying litigation matters and seeks a ruling to that effect. The discovery stage of the case occurred in 2022. The Court has set a schedule for submissions by the parties during 2023 and for a bench trial in mid-November 2023. We intend to defend the lawsuit vigorously. |
Segment Information
Segment Information | 3 Months Ended |
Apr. 01, 2023 | |
Segment Reporting [Abstract] | |
Segment Information | SEGMENT INFORMATION The tables below show select financial measures by reporting segment (in millions): Total Assets April 1, 2023 December 31, 2022 CSCA $ 5,057.7 $ 5,134.1 CSCI 5,897.2 5,883.2 Total $ 10,954.9 $ 11,017.3 Three Months Ended April 1, 2023 April 2, 2022 Net Operating Income (Loss) Intangible Asset Amortization Net Operating Income (Loss) Intangible Asset Amortization CSCA $ 763.7 $ 83.2 $ 13.9 $ 710.0 $ 78.5 $ 12.4 CSCI 418.1 21.3 51.5 364.5 16.2 36.1 Unallocated — (56.0) — — (73.0) — Continuing Operations Total $ 1,181.7 $ 48.5 $ 65.4 $ 1,074.5 $ 21.7 $ 48.5 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Apr. 01, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS Internal Revenue Service Audit of Athena Neurosciences, Inc., a U.S. Subsidiary On April 26, 2019, we received a revised NOPA from the IRS regarding transfer pricing positions related to the IRS audit of Athena Neurosciences, LLC ("Athena") for the years ended December 31, 2011, December 31, 2012, and December 31, 2013. The April 26, 2019 NOPA carried forward the IRS's theory from its 2017 draft NOPA that when Elan took over the future funding of Athena's in-process research and development after acquiring Athena in 1996, Elan should have paid a substantially higher royalty rate for the right to exploit Athena’s intellectual property in various developmental products, including the Multiple Sclerosis drug Tysabri, rather than rates based on transfer pricing documentation prepared by Elan's external tax advisors. The April 26, 2019 NOPA proposed a payment of $843.0 million, which represented additional tax based on imputing royalty income to Athena using a 24.7% royalty rate derived by the IRS and a 40.0% accuracy-related penalty. This amount excluded consideration of offsetting tax attributes and any potential interest that may be imposed. We strongly disagreed with the IRS position. On December 22, 2016, we also received a NOPA for these years denying the deductibility of settlement costs incurred in 2011 by Athena's parent company Elan Pharmaceuticals, Inc. ("EPI") related to illegal marketing of Zonegran by EPI's employees in the United States raised in a Qui Tam action under the U.S. False Claims Act. We strongly disagreed with the IRS' position on this issue as well. Because we believed that any concession on these issues in Appeals would be contrary to our evaluation of the issues and to avoid double taxation of the same income in the United States and Ireland, we pursued our remedies under the Mutual Agreement Procedure ("MAP") of the U.S.-Ireland Income Tax Treaty to alleviate double taxation. On April 21 and 23, 2020, we filed requests for Competent Authority assistance with the IRS and Irish Revenue on the Tysabri royalty issue, and those MAP applications were accepted. On October 20, 2020, we amended our requests for Competent Authority assistance to include the Zonegran issue and these supplemental requests were also accepted. On April 24, 2023, we received a letter from the IRS regarding the Competent Authority request filed for the Tysabri royalty issue, which concludes the competent authority process commenced by such submissions without the need for negotiations between the competent authorities and constitutes a full and final resolution of the April 26, 2019 NOPA. In the second quarter of fiscal year 2023 we plan to adjust any previously established reserves related to this matter. The Zonegran deduction issue remains pending in the MAP case and is being considered by APMA and the Irish Competent Authority. Internal Revenue Service Audits of Perrigo Company, a U.S. Subsidiary As detailed in Note 15. Income Taxes , on January 13, 2021, the IRS issued a 30-day letter for the 2013-2015 tax years, which included a proposal to reduce Perrigo U.S.'s deductible interest expense for the 2014 tax year and the 2015 tax year on $7.5 billion in certain intercompany debts owed by it to Perrigo Company plc. The debts were incurred in connection with the 2013 Elan merger transaction. On May 7, 2020, the IRS issued a NOPA capping the interest rate on the debts for U.S. federal tax purposes at 130.0% of the Applicable Federal Rate ("AFR") (a blended |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Apr. 01, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of PresentationOur unaudited Condensed Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and footnotes included in our Annual Report on Form 10-K for the year ended December 31, 2022. |
Principles of consolidation | In the opinion of management, all adjustments considered necessary for a fair presentation of the unaudited Condensed Consolidated Financial Statements have been included and include our accounts and accounts of all majority-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Certain prior period amounts have been reclassified to conform to the current period presentation. Some amounts in this report may not add due to rounding. |
Segment Reporting | Segment Reporting Our reporting and operating segments are as follows: • Consumer Self-Care Americas ("CSCA") comprises our consumer self-care business in the U.S. and Canada. CSCA previously included our Latin American businesses until they were disposed on March 9, 2022. • Consumer Self-Care International ("CSCI") comprises our consumer self-care business outside of the U.S. and Canada, primarily in Europe and Australia. We previously had an Rx segment which was comprised of our generic prescription pharmaceuticals business in the U.S., and other pharmaceuticals and diagnostic business in Israel, which have been divested. Following the divestiture, there were no substantial assets or operations left in this segment. The Rx segment was reported as Discontinued Operations in 2021, and is presented as such for all periods in this report (refer to Note 4 ) . |
Foreign Currency Translation and Transactions | Foreign Currency Translation and Transactions We translate our non-U.S. dollar-denominated operations’ assets and liabilities into U.S. dollars at current rates of exchange as of the balance sheet date and income and expense items at the average exchange rate for the reporting period. Translation adjustments resulting from exchange rate fluctuations are recorded in the cumulative translation account, a component of Accumulated other comprehensive income (loss) ("AOCI"). Gains or losses from foreign currency transactions are included in Other (income) expense, net. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Apr. 01, 2023 | |
Accounting Policies [Abstract] | |
Summary of Allowance for Credit Losses | The following table presents the allowance for credit losses activity (in millions): Three Months Ended April 1, 2023 April 2, 2022 Balance at beginning of period $ 6.8 $ 7.2 Provision for credit losses, net — 0.3 Receivables written-off (0.3) (0.8) Currency translation adjustment 0.6 0.4 Balance at end of period $ 7.1 $ 7.1 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Apr. 01, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Disaggregation of Revenue | The following is a summary of our net sales by category (1) (in millions): Three Months Ended April 1, 2023 April 2, 2022 CSCA Upper Respiratory $ 154.3 $ 152.8 Nutrition 139.9 127.2 Digestive Health 124.2 118.6 Pain and Sleep-Aids 103.5 102.9 Oral Care 84.4 70.4 Healthy Lifestyle 73.4 67.6 Skin Care 52.3 40.9 Women's Health 11.9 8.2 Vitamins, Minerals, and Supplements ("VMS") 4.0 7.7 Other CSCA (2) 15.8 13.7 Total CSCA 763.7 710.0 CSCI Upper Respiratory 84.8 66.5 Skin Care 83.4 73.9 Healthy Lifestyle 66.4 58.9 Pain and Sleep-Aids 49.9 54.0 VMS 47.8 49.5 Women's Health 29.1 13.7 Oral Care 29.1 28.9 Digestive Health 8.8 9.2 Other CSCI (3) 18.8 9.9 Total CSCI 418.1 364.5 Total net sales $ 1,181.7 $ 1,074.5 (1) We updated our global reporting product categories as a result of our product portfolio reconfiguration. These product categories have been adjusted retroactively to reflect the changes and have no impact on historical financial position, results of operations, or cash flows. (2) Consists primarily of product sales and royalty income related to supply and distribution agreements and other miscellaneous or otherwise uncategorized product lines and markets, none of which is greater than 10% of the segment net sales. (3) Consists primarily of our rare diseases business and other miscellaneous or otherwise uncategorized product lines, none of which is greater than 10% of the segment net sales. We generated net sales in the following geographic locations (1) (in millions): Three Months Ended April 1, 2023 April 2, 2022 U.S. $ 750.0 $ 683.1 Europe (2) 407.3 351.7 All other countries (3) 24.4 39.7 Total net sales $ 1,181.7 $ 1,074.5 (1) The net sales by geography are derived from the location of the entity that sells to a third party. (2) Includes Ireland net sales of $7.3 million and $6.6 million for the three months ended April 1, 2023 and April 2, 2022, respectively. (3) Includes net sales generated primarily in Australia and Canada. |
Summary of Contract with Customer Balances | The following table provides information about contract assets from contracts with customers (in millions): Balance Sheet Location April 1, 2023 December 31, 2022 Short-term contract assets Prepaid expenses and other current assets $ 31.7 $ 41.5 |
Business Combinations and Asset
Business Combinations and Asset Acquisitions (Tables) | 3 Months Ended |
Apr. 01, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Pro Forma Impact of Business Combinations | The following table presents unaudited pro forma information as if the HRA Pharma and Gateway acquisitions had occurred on January 1, 2021 and had been combined with the results reported in our Condensed Consolidated Statements of Operations for the three months ended April 2, 2022 (in millions): Three Months Ended (Unaudited) April 2, 2022 Net sales $ 1,209.3 Income (loss) from continuing operations $ 10.8 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Apr. 01, 2023 | |
Inventory Disclosure [Abstract] | |
Major Components of Inventory | Major components of inventory were as follows (in millions): April 1, 2023 December 31, 2022 Finished goods $ 674.7 $ 620.3 Work in process 251.1 262.2 Raw materials 257.2 267.8 Total inventories $ 1,183.0 $ 1,150.3 |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Apr. 01, 2023 | |
Investments [Abstract] | |
Equity Securities | The following table summarizes the measurement category, balance sheet location, and balances of our equity securities (in millions): Measurement Category Balance Sheet Location April 1, 2023 December 31, 2022 Fair value method Prepaid expenses and other current assets $ 0.1 $ 0.1 Fair value method (1) Other non-current assets $ 1.7 $ 1.7 Equity method Other non-current assets $ 62.7 $ 63.4 (1) Measured at fair value using the Net Asset Value practical expedient. |
Equity Security Expense (Income) | The following table summarizes the expense recognized in earnings of our equity securities (in millions): Three Months Ended Measurement Category Income Statement Location April 1, 2023 April 2, 2022 Fair value method Other expense (income), net $ 0.1 $ 0.2 Equity method Other expense (income), net $ 0.7 $ 0.7 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Apr. 01, 2023 | |
Leases [Abstract] | |
Balance Sheet Location of Lease Assets and Liabilities | The balance sheet locations of our lease assets and liabilities were as follows (in millions): Assets Balance Sheet Location April 1, 2023 December 31, 2022 Operating Operating lease assets $ 211.7 $ 217.1 Finance Other non-current assets 21.0 22.0 Total $ 232.7 $ 239.1 Liabilities Balance Sheet Location April 1, 2023 December 31, 2022 Current Operating Other accrued liabilities $ 28.3 $ 28.4 Finance Current indebtedness 2.8 3.3 Non-Current Operating Other non-current liabilities 184.7 189.5 Finance Long-term debt, less current portion 16.9 17.4 Total $ 232.7 $ 238.6 The below tables show our lease assets and liabilities by reporting segment (in millions): Assets Operating Financing April 1, 2023 December 31, 2022 April 1, 2023 December 31, 2022 CSCA $ 97.9 $ 100.5 $ 13.5 $ 13.8 CSCI 48.4 49.5 6.5 6.6 Unallocated 65.4 67.1 1.0 1.6 Total $ 211.7 $ 217.1 $ 21.0 $ 22.0 Liabilities Operating Financing April 1, 2023 December 31, 2022 April 1, 2023 December 31, 2022 CSCA $ 99.4 $ 102.2 $ 14.6 $ 14.9 CSCI 51.0 51.7 4.0 4.1 Unallocated 62.6 64.0 1.1 1.7 Total $ 213.0 $ 217.9 $ 19.7 $ 20.7 |
Lease Expense | Lease expense was as follows (in millions): Three Months Ended April 1, 2023 April 2, 2022 Operating leases (1) $ 12.0 $ 9.7 Finance leases Amortization $ 1.1 $ 1.5 Interest 0.1 0.2 Total finance leases $ 1.2 $ 1.7 (1) Includes short-term leases and variable lease costs, which are immaterial. |
Finance Lease Maturity | The annual future maturities of our leases as of April 1, 2023 are as follows (in millions): Operating Leases Finance Leases Total 2023 $ 24.7 $ 2.7 $ 27.4 2024 29.5 2.4 31.9 2025 27.6 2.2 29.8 2026 22.4 2.0 24.4 2027 21.7 2.0 23.7 After 2027 117.9 11.6 129.5 Total lease payments 243.8 22.9 266.7 Less: Interest 30.8 3.2 34.0 Present value of lease liabilities $ 213.0 $ 19.7 $ 232.7 |
Operating Lease Liability Maturity | The annual future maturities of our leases as of April 1, 2023 are as follows (in millions): Operating Leases Finance Leases Total 2023 $ 24.7 $ 2.7 $ 27.4 2024 29.5 2.4 31.9 2025 27.6 2.2 29.8 2026 22.4 2.0 24.4 2027 21.7 2.0 23.7 After 2027 117.9 11.6 129.5 Total lease payments 243.8 22.9 266.7 Less: Interest 30.8 3.2 34.0 Present value of lease liabilities $ 213.0 $ 19.7 $ 232.7 |
Weighted Average Lease Terms and Discount Rates | Our weighted average lease terms and discount rates are as follows: April 1, 2023 April 2, 2022 Weighted-average remaining lease term (in years) Operating leases 10.85 12.09 Finance leases 9.49 9.28 Weighted-average discount rate Operating leases 2.5 % 2.6 % Finance leases 3.0 % 2.8 % |
Lease Cash Flow Classifications | Our lease cash flow classifications are as follows (in millions): Three Months Ended April 1, 2023 April 2, 2022 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows for operating leases $ 9.0 $ 8.5 Operating cash flows for finance leases $ 0.1 $ 0.2 Financing cash flows for finance leases $ 1.0 $ 1.3 Leased assets obtained in exchange for new operating lease liabilities $ 1.4 $ 31.6 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Apr. 01, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Changes in the carrying amount of goodwill, by reportable segment, were as follows (in millions): December 31, 2022 Purchase accounting adjustments Currency translation adjustments April 1, 2023 CSCA (1) $ 2,044.4 $ 35.2 $ — $ 2,079.6 CSCI (2) 1,446.0 45.4 20.2 1,511.6 Total goodwill $ 3,490.4 $ 80.6 $ 20.2 $ 3,591.2 (1) We had accumulated goodwill impairments of $6.1 million as of April 1, 2023 and December 31, 2022. (2) We had accumulated goodwill impairments of $878.4 million as of April 1, 2023 and December 31, 2022. |
Schedule of Finite and Indefinite-lived Intangible Assets | Intangible assets and related accumulated amortization consisted of the following (in millions): April 1, 2023 December 31, 2022 Gross Accumulated Gross Accumulated Indefinite-lived intangibles: (1) Trademarks, trade names, and brands $ 3.2 $ — $ 3.2 $ — In-process research and development 56.0 — 55.4 — Total indefinite-lived intangibles $ 59.2 $ — $ 58.6 $ — Definite-lived intangibles: Distribution and license agreements and supply agreements $ 95.1 $ 59.2 $ 94.9 $ 58.1 Developed product technology, formulations, and product rights 474.9 218.2 484.8 211.8 Customer relationships and distribution networks 1,844.7 1,006.8 1,825.1 965.9 Trademarks, trade names, and brands 2,462.4 509.0 2,542.2 481.0 Non-compete agreements 2.0 2.0 2.0 2.0 Total definite-lived intangibles $ 4,879.1 $ 1,795.2 $ 4,949.0 $ 1,718.8 Total intangible assets $ 4,938.3 $ 1,795.2 $ 5,007.6 $ 1,718.8 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Apr. 01, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Assets Measured on Recurring and Nonrecurring Basis | The table below summarizes the valuation of our financial instruments carried at fair value by the applicable pricing categories (in millions): April 1, 2023 December 31, 2022 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Measured at fair value on a recurring basis: Assets: Investment securities $ 0.1 $ — $ — $ 0.1 $ — $ — Foreign currency forward contracts — 3.4 — — 4.2 — Interest rate swap agreements — 24.9 — — 50.5 — Total assets $ 0.1 $ 28.3 $ — $ 0.1 $ 54.7 $ — Liabilities: Cross-currency swap $ — $ 111.3 $ — $ — $ 96.1 $ — Foreign currency forward contracts — 3.1 — — 5.2 — Total liabilities $ — $ 114.4 $ — $ — $ 101.3 $ — |
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments | Our fixed rate long-term debt consisted of the following (in millions): April 1, 2023 December 31, 2022 Level 1 Level 1 Public Bonds Carrying value (excluding discount) $ 2,544.4 $ 2,544.4 Fair value $ 2,315.0 $ 2,225.4 |
Derivative Instruments and He_2
Derivative Instruments and Hedging Activities (Tables) | 3 Months Ended |
Apr. 01, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Foreign Currency Forward Contracts | oreign currency forward contracts were as follows (in millions): April 1, 2023 December 31, 2022 British Pound (GBP) $ 213.1 $ 224.9 European Euro (EUR) 65.8 61.7 Swedish Krona (SEK) 65.6 56.9 United States Dollar (USD) 54.8 51.7 Chinese Yuan (CNH) 26.5 34.4 Danish Krone (DKK) 26.3 51.7 Canadian Dollar (CAD) 19.7 24.9 Mexican Peso (MXN) 19.4 13.3 Hungarian Forint (HUF) 15.8 10.6 Polish Zloty (PLZ) 15.7 25.2 Norwegian Krone (NOK) 10.5 12.4 Other (1) 26.3 25.9 Total $ 559.5 $ 593.6 (1) Number consists of various currencies notional amounts, none of which individually exceed $10 million in either period presented. |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The balance sheet location and gross fair value of our derivative instruments were as follows (in millions): Balance Sheet Location April 1, 2023 December 31, 2022 Designated derivative assets: Foreign currency forward contracts Prepaid expenses and other current assets $ 1.6 $ 1.1 Interest rate swap agreements Prepaid expenses and other current assets — 3.0 Foreign currency forward contracts Other non-current assets 0.7 0.7 Interest rate swap agreements Other non-current assets 24.9 47.5 Total designated derivative assets $ 27.2 $ 52.3 Non-designated derivative assets: Foreign currency forward contracts Prepaid expenses and other current assets $ 1.1 $ 2.4 Total non-designated derivative assets $ 1.1 $ 2.4 Designated derivative liabilities: Foreign currency forward contracts Other accrued liabilities $ 2.3 $ 4.2 Cross-currency swap Other accrued liabilities 111.3 96.1 Total designated derivative liabilities $ 113.6 $ 100.3 Non-designated derivative liabilities: Foreign currency forward contracts Other accrued liabilities $ 0.8 $ 1.0 |
Amount of Gain/(Loss) Recognized against Earnings | The amounts of (income)/expense recognized in earnings related to our non-designated derivatives on the Consolidated Statements of Operations were as follows (in millions): Three months ended Non-Designated Derivatives Income Statement Location April 1, 2023 April 2, 2022 Foreign currency forward contracts Other expense (income), net $ (1.2) $ 0.5 Interest expense, net (0.6) (0.4) $ (1.8) $ 0.1 Foreign currency options Other expense (income), net $ — $ 3.5 |
Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) | The following tables summarize the effect of derivative instruments designated as hedging instruments in AOCI (in millions): Gain/(Loss) Reclassified from AOCI into Earnings Related to Amounts Excluded from Effectiveness Testing Amount Recorded in OCI (1) Classification Amount Classification Amount Recognized in Earnings on Derivatives Three Months Ended April 1, 2023 Cash flow hedges: Interest rate swap agreements $ 24.9 Interest expense, net $ 2.9 Interest expense, net $ — Foreign currency forward contracts (6.7) Net sales 0.4 Net sales — Cost of sales (0.2) Cost of sales — Other (income) expense, net 0.1 Total Cash flow hedges $ 18.2 $ 3.1 $ 0.1 Net investment hedges: Cross-currency swap $ (23.7) Interest expense, net $ (6.5) Three Months Ended April 2, 2022 Cash flow hedges: Interest rate swap agreements $ — Interest expense, net $ (0.5) Interest expense, net $ — Foreign currency forward contracts $ (7.2) Net sales 0.3 Net sales $ — Cost of sales (0.4) Cost of sales $ 0.1 Other expense (income), net $ 0.1 Total Cash flow hedges $ (7.2) $ (0.6) $ 0.2 Net investment hedges: Cross-currency swap $ (4.6) Interest expense, net $ (0.5) (1) Net loss of $1.6 million is expected to be reclassified out of AOCI into earnings during the next 12 months. |
Classification of Gain (Loss) Recognized in Earnings on Fair Value and Cash Flow Hedging Relationships | The classification and amount of gain/(loss) recognized in earnings on fair value and hedging relationships were as follows (in millions): Net Sales Cost of Sales Interest Expense, net Other (Income) Expense, net Three Months Ended April 1, 2023 Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded $ 1,181.7 $ 767.9 $ 43.7 $ 0.5 Gain (loss) on cash flow hedging relationships Foreign currency forward contracts Amount of gain or (loss) reclassified from AOCI into earnings $ 0.4 $ (0.2) $ — $ — Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach $ — $ — $ — $ 0.1 Interest rate swap agreements Amount of gain or (loss) reclassified from AOCI into earnings $ — $ — $ 2.9 $ — Three Months Ended April 2, 2022 Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded $ 1,074.5 $ 736.7 $ 35.8 $ (1.1) Gain (loss) on cash flow hedging relationships Foreign currency forward contracts Amount of gain or (loss) reclassified from AOCI into earnings $ 0.3 $ (0.4) $ — $ — Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach $ — $ 0.1 $ — $ 0.1 Interest rate swap agreements Amount of gain or (loss) reclassified from AOCI into earnings $ — $ — $ (0.5) $ — |
Indebtedness (Tables)
Indebtedness (Tables) | 3 Months Ended |
Apr. 01, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Total borrowings are summarized as follows (in millions): April 1, 2023 December 31, 2022 Term loan 2022 Term loan A due April 20, 2027 490.6 493.8 2022 Term loan B due April 20, 2029 1,091.8 1,094.5 Total term loans 1,582.4 1,588.3 Notes and Bonds Coupon Due 3.900% December 15, 2024 700.0 700.0 4.375% March 15, 2026 700.0 700.0 4.400% June 15, 2030 (1) 750.0 750.0 5.300% November 15, 2043 90.5 90.5 4.900% December 15, 2044 303.9 303.9 Total notes and bonds 2,544.4 2,544.4 Other financing 19.4 20.6 Unamortized premium (discount), net (15.3) (15.9) Deferred financing fees (29.3) (30.8) Total borrowings outstanding 4,101.6 4,106.6 Current indebtedness (38.8) (36.2) Total long-term debt less current portion $ 4,062.8 $ 4,070.4 (1) The coupon rate noted above is as of April 1, 2023, this will increase from 4.400% to 4.650% on payments starting after June 15, 2023, following a credit rating downgrade by Moody's in the first quarter of 2023. Future interest rate adjustments are subject to a 2.0% total cap above the original 3.150% interest rate based on certain rating events as specified in the Note’s Supplemental Indenture No. 3, dated as of June 19, 2020, among Perrigo Finance Unlimited Company, Perrigo Company plc and Wells Fargo Bank, National Association, as trustee. |
Earnings Per Share and Shareh_2
Earnings Per Share and Shareholders' Equity (Tables) | 3 Months Ended |
Apr. 01, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings per Share, Basic and Diluted | A reconciliation of the numerators and denominators used in our basic and diluted earnings per share ("EPS") calculation is as follows (in millions): Three Months Ended April 1, 2023 April 2, 2022 Numerator: Income (loss) from continuing operations $ (1.1) $ (1.3) Income (loss) from discontinued operations, net of tax (1.9) (1.1) Net income (loss) $ (3.0) $ (2.4) Denominator: Weighted average shares outstanding for basic EPS 134.9 134.0 Weighted average shares outstanding for diluted EPS (1) 134.9 134.0 Anti-dilutive share-based awards excluded from computation of diluted EPS (1) — — (1) In the period of a net loss from continuing operations, diluted shares equal basic shares. |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Apr. 01, 2023 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | Changes in our AOCI balances, net of tax were as follows (in millions): Fair Value of Derivative Financial Instruments, net of tax Foreign Currency Translation Adjustments Post-Employment Plan Adjustments, net of tax (1) Total AOCI Balance at December 31, 2022 $ 24.5 $ (58.6) $ 7.1 $ (27.0) OCI before reclassifications (28.4) 52.7 (0.5) 23.8 Amounts reclassified from AOCI (3.1) — — (3.1) Other comprehensive income (loss) $ (31.5) $ 52.7 $ (0.5) $ 20.7 Balance at April 1, 2023 $ (7.0) $ (5.9) $ 6.6 $ (6.3) |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 3 Months Ended |
Apr. 01, 2023 | |
Restructuring Charges [Abstract] | |
Restructuring and Related Costs | The following reflects our restructuring activity (in millions): Three Months Ended April 1, 2023 April 2, 2022 Supply Chain Reinvention HRA Pharma Integration Other Initiatives Total Total Beginning balance $ 2.2 $ 13.3 $ 4.3 $ 19.8 $ 6.9 Additional charges 2.6 0.8 $ — 3.4 3.6 Payments (4.4) (2.6) $ (1.0) (8.0) (2.1) Non-cash adjustments — 0.3 $ 0.1 0.4 (0.2) Ending balance $ 0.4 $ 11.8 $ 3.4 $ 15.6 $ 8.2 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Apr. 01, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of effective income tax rate reconciliation | The effective tax rates were as follows: Three Months Ended April 1, 2023 April 2, 2022 123.8 % 90.2 % |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Apr. 01, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The tables below show select financial measures by reporting segment (in millions): Total Assets April 1, 2023 December 31, 2022 CSCA $ 5,057.7 $ 5,134.1 CSCI 5,897.2 5,883.2 Total $ 10,954.9 $ 11,017.3 Three Months Ended April 1, 2023 April 2, 2022 Net Operating Income (Loss) Intangible Asset Amortization Net Operating Income (Loss) Intangible Asset Amortization CSCA $ 763.7 $ 83.2 $ 13.9 $ 710.0 $ 78.5 $ 12.4 CSCI 418.1 21.3 51.5 364.5 16.2 36.1 Unallocated — (56.0) — — (73.0) — Continuing Operations Total $ 1,181.7 $ 48.5 $ 65.4 $ 1,074.5 $ 21.7 $ 48.5 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Allowance for Credit Losses (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Apr. 02, 2022 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Balance at beginning of period | $ 6.8 | $ 7.2 |
Provision for credit losses, net | 0 | 0.3 |
Receivables written-off | (0.3) | (0.8) |
Currency translation adjustment | 0.6 | 0.4 |
Balance at end of period | $ 7.1 | $ 7.1 |
Revenue Recognition - Schedule
Revenue Recognition - Schedule of Revenue by Product (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Apr. 02, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 1,181.7 | $ 1,074.5 |
CSCA | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 763.7 | 710 |
CSCA | Upper Respiratory | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 154.3 | 152.8 |
CSCA | Nutrition | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 139.9 | 127.2 |
CSCA | Digestive Health | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 124.2 | 118.6 |
CSCA | Pain and Sleep-Aids | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 103.5 | 102.9 |
CSCA | Oral Care | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 84.4 | 70.4 |
CSCA | Healthy Lifestyle | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 73.4 | 67.6 |
CSCA | Skin Care | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 52.3 | 40.9 |
CSCA | Women's Health | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 11.9 | 8.2 |
CSCA | Vitamins, Minerals, and Supplements ("VMS") | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 4 | 7.7 |
CSCA | Other CSCA | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 15.8 | 13.7 |
CSCI | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 418.1 | 364.5 |
CSCI | Upper Respiratory | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 84.8 | 66.5 |
CSCI | Digestive Health | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 8.8 | 9.2 |
CSCI | Pain and Sleep-Aids | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 49.9 | 54 |
CSCI | Oral Care | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 29.1 | 28.9 |
CSCI | Healthy Lifestyle | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 66.4 | 58.9 |
CSCI | Skin Care | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 83.4 | 73.9 |
CSCI | Women's Health | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 29.1 | 13.7 |
CSCI | Vitamins, Minerals, and Supplements ("VMS") | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 47.8 | 49.5 |
CSCI | Other CSCI | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 18.8 | $ 9.9 |
Revenue Recognition - Additiona
Revenue Recognition - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Apr. 02, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 1,181.7 | $ 1,074.5 |
Contract manufacturing | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 90 | $ 70.8 |
Revenue Recognition - Schedul_2
Revenue Recognition - Schedule of Contract Balances (Details) - USD ($) $ in Millions | Apr. 01, 2023 | Dec. 31, 2022 |
Revenue from Contract with Customer [Abstract] | ||
Short-term contract assets | $ 31.7 | $ 41.5 |
Revenue Recognition - Schedul_3
Revenue Recognition - Schedule of Revenue by Geographic Location (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Apr. 02, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 1,181.7 | $ 1,074.5 |
U.S. | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 750 | 683.1 |
Europe | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 407.3 | 351.7 |
All other countries | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 24.4 | 39.7 |
Ireland | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 7.3 | $ 6.6 |
Acquisitions and Divestitures -
Acquisitions and Divestitures - Narrative (Details) $ in Millions, € in Billions | 3 Months Ended | 12 Months Ended | ||||||
Nov. 01, 2022 USD ($) | Apr. 29, 2022 USD ($) | Apr. 29, 2022 EUR (€) | Mar. 24, 2022 USD ($) | Mar. 09, 2022 USD ($) | Apr. 01, 2023 USD ($) | Apr. 02, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Business Acquisition [Line Items] | ||||||||
Goodwill | $ 3,591.2 | $ 3,490.4 | ||||||
Adjustment, cost of sales | 3.5 | |||||||
Net proceeds from sale of businesses | 0 | $ 58.7 | ||||||
Gain on sale of business | 0 | $ (1.4) | ||||||
Discontinued Operations, Disposed of by Sale | ||||||||
Business Acquisition [Line Items] | ||||||||
Installment receivable, period one | 12 months | |||||||
Installment receivable, period two | 18 months | |||||||
Consideration, installment receivables | $ 11.3 | |||||||
Contingent consideration | 7.2 | |||||||
Discontinued Operations, Disposed of by Sale | Advent International | ||||||||
Business Acquisition [Line Items] | ||||||||
Total consideration | 23.9 | |||||||
Net proceeds from sale of businesses | 5.4 | |||||||
Discontinued Operations, Disposed of by Sale | Latin America Business | ||||||||
Business Acquisition [Line Items] | ||||||||
Gain on sale of business | $ (1.4) | |||||||
CSCA | ||||||||
Business Acquisition [Line Items] | ||||||||
Goodwill | 2,079.6 | 2,044.4 | ||||||
CSCI | ||||||||
Business Acquisition [Line Items] | ||||||||
Goodwill | 1,511.6 | $ 1,446 | ||||||
CSCI | ScarAway Member | ||||||||
Business Acquisition [Line Items] | ||||||||
Net proceeds from sale of businesses | $ 20.7 | |||||||
Gain on sale of business | $ 3.6 | |||||||
HRA Pharma | ||||||||
Business Acquisition [Line Items] | ||||||||
Outstanding equity interest acquired (percent) | 100% | 100% | ||||||
Total consideration | $ 1,900 | € 1.8 | ||||||
Goodwill | 80.6 | |||||||
Definite-lived intangibles | 104.3 | |||||||
Deferred income tax liabilities | 27.2 | |||||||
Other non-current liabilities | 2 | |||||||
Accounts payable | $ 1.5 | |||||||
Nestlé’s Gateway Infant Formula Plant and Good Start® infant formula | ||||||||
Business Acquisition [Line Items] | ||||||||
Total consideration | $ 110 |
Acquisitions and Divestitures_2
Acquisitions and Divestitures - Pro Forma (Details) $ in Millions | 3 Months Ended |
Apr. 02, 2022 USD ($) | |
Business Combination and Asset Acquisition [Abstract] | |
Net sales | $ 1,209.3 |
Income (loss) from continuing operations | $ 10.8 |
Discontinued Operations - Narra
Discontinued Operations - Narrative (Details) - RX Pharmaceuticals - Discontinued Operations, Disposed of by Sale $ in Millions | Jul. 06, 2021 USD ($) |
Discontinued Operations | |
Total consideration | $ 1,550 |
Potential R&D milestone payments and contingent purchase obligations assumed by purchaser | $ 53.3 |
Supply agreement term | 4 years |
Supply agreement, extension period | 7 years |
Aggregate cap on buyer's obligation for certain pre-closing liabilities (percent) | 5,000% |
Aggregate cap on buyer's obligation for certain pre-closing liabilities | $ 50 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Apr. 01, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 674.7 | $ 620.3 |
Work in process | 251.1 | 262.2 |
Raw materials | 257.2 | 267.8 |
Total inventories | $ 1,183 | $ 1,150.3 |
Investments (Details)
Investments (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 01, 2023 | Apr. 02, 2022 | Dec. 31, 2022 | |
Other expense (income), net | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity securities, fair value method, other expense (income) | $ 0.1 | $ 0.2 | |
Equity securities, equity method, other expense (income) | 0.7 | $ 0.7 | |
Prepaid expenses and other current assets | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity securities, fair value method | 0.1 | $ 0.1 | |
Other non-current assets | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity securities, fair value method | 1.7 | 1.7 | |
Equity securities, equity method, other non-current assets | $ 62.7 | $ 63.4 |
Leases - Balance Sheet Location
Leases - Balance Sheet Location of Assets and Liabilities (Details) - USD ($) $ in Millions | Apr. 01, 2023 | Dec. 31, 2022 |
Lessee, Lease, Description [Line Items] | ||
Operating lease assets | $ 211.7 | $ 217.1 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other non-current assets | Other non-current assets |
Finance leases | $ 21 | $ 22 |
Right-of-use asset | $ 232.7 | $ 239.1 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Other accrued liabilities | Other accrued liabilities |
Operating lease liability, current | $ 28.3 | $ 28.4 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Current indebtedness | Current indebtedness |
Finance lease liability, current | $ 2.8 | $ 3.3 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other non-current liabilities | Other non-current liabilities |
Operating lease liability, noncurrent | $ 184.7 | $ 189.5 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Long-term debt, less current portion | Long-term debt, less current portion |
Finance lease liability, noncurrent | $ 16.9 | $ 17.4 |
Present value of lease liabilities | 232.7 | 238.6 |
Total operating lease liabilities | 213 | 217.9 |
Total finance lease liabilities | 19.7 | 20.7 |
Unallocated | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease assets | 65.4 | 67.1 |
Finance leases | 1 | 1.6 |
Total operating lease liabilities | 62.6 | 64 |
Total finance lease liabilities | 1.1 | 1.7 |
CSCA | Operating Segments | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease assets | 97.9 | 100.5 |
Finance leases | 13.5 | 13.8 |
Total operating lease liabilities | 99.4 | 102.2 |
Total finance lease liabilities | 14.6 | 14.9 |
CSCI | Operating Segments | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease assets | 48.4 | 49.5 |
Finance leases | 6.5 | 6.6 |
Total operating lease liabilities | 51 | 51.7 |
Total finance lease liabilities | $ 4 | $ 4.1 |
Leases - Lease Expense (Details
Leases - Lease Expense (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Apr. 02, 2022 | |
Leases [Abstract] | ||
Operating leases | $ 12 | $ 9.7 |
Finance leases | ||
Amortization | 1.1 | 1.5 |
Interest | 0.1 | 0.2 |
Total finance leases | $ 1.2 | $ 1.7 |
Leases - Annual Future Maturiti
Leases - Annual Future Maturities of Leases (Details) - USD ($) $ in Millions | Apr. 01, 2023 | Dec. 31, 2022 |
Operating Leases | ||
2023 | $ 24.7 | |
2024 | 29.5 | |
2025 | 27.6 | |
2026 | 22.4 | |
2027 | 21.7 | |
After 2027 | 117.9 | |
Total lease payments | 243.8 | |
Less: Interest | 30.8 | |
Present value of lease liabilities | 213 | $ 217.9 |
Finance Leases | ||
2023 | 2.7 | |
2024 | 2.4 | |
2025 | 2.2 | |
2026 | 2 | |
2027 | 2 | |
After 2027 | 11.6 | |
Total lease payments | 22.9 | |
Less: Interest | 3.2 | |
Present value of lease liabilities | 19.7 | 20.7 |
Total | ||
2023 | 27.4 | |
2024 | 31.9 | |
2025 | 29.8 | |
2026 | 24.4 | |
2027 | 23.7 | |
After 2027 | 129.5 | |
Total lease payments | 266.7 | |
Less: Interest | 34 | |
Present value of lease liabilities | $ 232.7 | $ 238.6 |
Leases - Weighted Average Lease
Leases - Weighted Average Lease Terms and Discount Rates (Details) | Apr. 01, 2023 | Apr. 02, 2022 |
Leases [Abstract] | ||
Weighted-average remaining lease term - Operating leases | 10 years 10 months 6 days | 12 years 1 month 2 days |
Weighted-average lease term - Finance leases | 9 years 5 months 26 days | 9 years 3 months 10 days |
Weighted-average discount rate - Operating lease (percent) | 2.50% | 2.60% |
Weighted-average discount rate - Finance lease (percent) | 3% | 2.80% |
Leases - Lease Cash Flow Classi
Leases - Lease Cash Flow Classifications (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Apr. 02, 2022 | |
Leases [Abstract] | ||
Operating cash flows for operating leases | $ 9 | $ 8.5 |
Operating cash flows for finance leases | 0.1 | 0.2 |
Financing cash flows for finance leases | 1 | 1.3 |
Leased assets obtained in exchange for new operating lease liabilities | $ 1.4 | $ 31.6 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Goodwill (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Dec. 31, 2022 | |
Goodwill [Roll Forward] | ||
Goodwill, beginning of period | $ 3,490.4 | |
Purchase accounting adjustments | 80.6 | |
Currency translation adjustments | 20.2 | |
Goodwill, end of period | 3,591.2 | |
CSCA | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning of period | 2,044.4 | |
Purchase accounting adjustments | 35.2 | |
Currency translation adjustments | 0 | |
Goodwill, end of period | 2,079.6 | |
Accumulated impairments | (6.1) | $ (6.1) |
CSCI | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning of period | 1,446 | |
Purchase accounting adjustments | 45.4 | |
Currency translation adjustments | 20.2 | |
Goodwill, end of period | 1,511.6 | |
Accumulated impairments | $ (878.4) | $ (878.4) |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Intangible categories (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 01, 2023 | Apr. 02, 2022 | Dec. 31, 2022 | |
Finite And Indefinite Lived Assets By Major Class [Line Items] | |||
Indefinite-lived intangible assets | $ 59.2 | $ 58.6 | |
Definite-lived intangible assets | 4,879.1 | 4,949 | |
Accumulated Amortization | 1,795.2 | 1,718.8 | |
Total intangible assets | 4,938.3 | 5,007.6 | |
Intangible assets amortization expense | 65.4 | $ 48.5 | |
Distribution and license agreements and supply agreements | |||
Finite And Indefinite Lived Assets By Major Class [Line Items] | |||
Definite-lived intangible assets | 95.1 | 94.9 | |
Accumulated Amortization | 59.2 | 58.1 | |
Developed product technology, formulations, and product rights | |||
Finite And Indefinite Lived Assets By Major Class [Line Items] | |||
Definite-lived intangible assets | 474.9 | 484.8 | |
Accumulated Amortization | 218.2 | 211.8 | |
Customer relationships and distribution networks | |||
Finite And Indefinite Lived Assets By Major Class [Line Items] | |||
Definite-lived intangible assets | 1,844.7 | 1,825.1 | |
Accumulated Amortization | 1,006.8 | 965.9 | |
Trademarks, trade names, and brands | |||
Finite And Indefinite Lived Assets By Major Class [Line Items] | |||
Definite-lived intangible assets | 2,462.4 | 2,542.2 | |
Accumulated Amortization | 509 | 481 | |
Non-compete agreements | |||
Finite And Indefinite Lived Assets By Major Class [Line Items] | |||
Definite-lived intangible assets | 2 | 2 | |
Accumulated Amortization | 2 | 2 | |
Trademarks, trade names, and brands | |||
Finite And Indefinite Lived Assets By Major Class [Line Items] | |||
Indefinite-lived intangible assets | 3.2 | 3.2 | |
In-process research and development | |||
Finite And Indefinite Lived Assets By Major Class [Line Items] | |||
Indefinite-lived intangible assets | $ 56 | $ 55.4 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Instruments at Fair Value (Details) - Measured at fair value on a recurring basis - USD ($) $ in Millions | Apr. 01, 2023 | Dec. 31, 2022 |
Level 1 | ||
Assets: | ||
Investment securities | $ 0.1 | $ 0.1 |
Total assets | 0.1 | 0.1 |
Liabilities: | ||
Total liabilities | 0 | 0 |
Level 1 | Foreign currency forward contracts | ||
Assets: | ||
Derivative assets | 0 | 0 |
Liabilities: | ||
Derivative liabilities | 0 | 0 |
Level 1 | Interest rate swap agreements | ||
Assets: | ||
Derivative assets | 0 | 0 |
Level 1 | Cross-currency swap | ||
Liabilities: | ||
Derivative liabilities | 0 | 0 |
Level 2 | ||
Assets: | ||
Investment securities | 0 | 0 |
Total assets | 28.3 | 54.7 |
Liabilities: | ||
Total liabilities | 114.4 | 101.3 |
Level 2 | Foreign currency forward contracts | ||
Assets: | ||
Derivative assets | 3.4 | 4.2 |
Liabilities: | ||
Derivative liabilities | 3.1 | 5.2 |
Level 2 | Interest rate swap agreements | ||
Assets: | ||
Derivative assets | 24.9 | 50.5 |
Level 2 | Cross-currency swap | ||
Liabilities: | ||
Derivative liabilities | 111.3 | 96.1 |
Level 3 | ||
Assets: | ||
Investment securities | 0 | 0 |
Total assets | 0 | 0 |
Liabilities: | ||
Total liabilities | 0 | 0 |
Level 3 | Foreign currency forward contracts | ||
Assets: | ||
Derivative assets | 0 | 0 |
Liabilities: | ||
Derivative liabilities | 0 | 0 |
Level 3 | Interest rate swap agreements | ||
Assets: | ||
Derivative assets | 0 | 0 |
Level 3 | Cross-currency swap | ||
Liabilities: | ||
Derivative liabilities | $ 0 | $ 0 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Fixed Rate Long-term Debt (Details) - USD ($) $ in Millions | Apr. 01, 2023 | Dec. 31, 2022 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Public Bonds | $ 2,544.4 | $ 2,544.4 |
Public Bonds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Public Bonds | 2,315 | 2,225.4 |
Reported Value Measurement | Public Bonds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Public Bonds | $ 2,544.4 | $ 2,544.4 |
Derivative Instruments and He_3
Derivative Instruments and Hedging Activities - Narrative (Details) $ in Millions | 1 Months Ended | 3 Months Ended | ||||
Apr. 30, 2022 USD ($) derivative brand | Apr. 01, 2023 USD ($) | Apr. 02, 2022 USD ($) | Oct. 25, 2022 USD ($) derivative | Jun. 01, 2022 USD ($) | Sep. 30, 2021 USD ($) derivative | |
Foreign currency options | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Number of instruments held | derivative | 2 | 2 | ||||
Notional amount of derivatives | $ 2,000 | |||||
Payments for premiums | $ 37.1 | |||||
Foreign currency options | Not Designated as Hedging Instrument | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Notional amount of derivatives | $ 1,100 | |||||
Change in fair value of option contract | $ 0 | $ 3.5 | ||||
Interest rate swap agreements | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Number of instruments held | derivative | 5 | |||||
Interest rate swap agreements | Cash Flow Hedging | New Term Loan B Facility | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Number of instruments held | derivative | 3 | |||||
Interest rate swap agreements | Cash Flow Hedging | New Term Loan A Facility | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Number of instruments held | brand | 2 | |||||
Interest rate swap agreements | Net Investment Hedging | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Number of instruments held | derivative | 3 | 3 | ||||
Interest rate swap agreements | Net Investment Hedging | October 25, 2022 Through December 15, 2024 | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Notional amount of derivatives | $ 700 | |||||
Interest rate swap agreements | Net Investment Hedging | October 25, 2022 through March 25, 2026 | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Notional amount of derivatives | 700 | |||||
Interest rate swap agreements | Net Investment Hedging | October 25, 2022 through June 15, 2030 | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Notional amount of derivatives | $ 100 | |||||
Interest rate swap agreements | June 1, 2022 Through April 1, 2029 | Maximum | Cash Flow Hedging | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Notional amount of derivatives | $ 1,000 | |||||
Interest rate swap agreements | June 1, 2022 Through April 1, 2029 | Minimum | Cash Flow Hedging | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Notional amount of derivatives | $ 812.5 | |||||
Interest rate swap agreements | June 1, 2022 Through April 1, 2027 | Maximum | Cash Flow Hedging | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Notional amount of derivatives | $ 487.5 | |||||
Interest rate swap agreements | June 1, 2022 Through April 1, 2027 | Minimum | Cash Flow Hedging | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Notional amount of derivatives | $ 387.5 |
Derivative Instruments and He_4
Derivative Instruments and Hedging Activities - Foreign Currency Forward Contracts (Details) - Foreign currency forward contracts - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Dec. 31, 2022 | |
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Notional amount of derivatives | $ 559.5 | $ 593.6 |
Maximum remaining maturity of foreign currency derivatives | 60 months | |
British Pound (GBP) | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Notional amount of derivatives | $ 213.1 | 224.9 |
European Euro (EUR) | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Notional amount of derivatives | 65.8 | 61.7 |
Swedish Krona (SEK) | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Notional amount of derivatives | 65.6 | 56.9 |
United States Dollar (USD) | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Notional amount of derivatives | 54.8 | 51.7 |
Chinese Yuan (CNH) | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Notional amount of derivatives | 26.5 | 34.4 |
Danish Krone (DKK) | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Notional amount of derivatives | 26.3 | 51.7 |
Canadian Dollar (CAD) | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Notional amount of derivatives | 19.7 | 24.9 |
Mexican Peso (MXN) | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Notional amount of derivatives | 19.4 | 13.3 |
Hungarian Forint (HUF) | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Notional amount of derivatives | 15.8 | 10.6 |
Polish Zloty (PLZ) | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Notional amount of derivatives | 15.7 | 25.2 |
Norwegian Krone (NOK) | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Notional amount of derivatives | 10.5 | 12.4 |
Other | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Notional amount of derivatives | 26.3 | 25.9 |
Maximum individual amount | $ 10 | $ 10 |
Derivative Instruments and He_5
Derivative Instruments and Hedging Activities - Balance Sheet Location (Details) - USD ($) $ in Millions | Apr. 01, 2023 | Dec. 31, 2022 |
Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives | $ 27.2 | $ 52.3 |
Liability derivative | 113.6 | 100.3 |
Designated as Hedging Instrument | Prepaid expenses and other current assets | Foreign currency forward contracts | ||
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives | 1.6 | 1.1 |
Designated as Hedging Instrument | Prepaid expenses and other current assets | Interest rate swap agreements | ||
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives | 0 | 3 |
Designated as Hedging Instrument | Other non-current assets | Foreign currency forward contracts | ||
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives | 0.7 | 0.7 |
Designated as Hedging Instrument | Other non-current assets | Interest rate swap agreements | ||
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives | 24.9 | 47.5 |
Designated as Hedging Instrument | Other accrued liabilities | Foreign currency forward contracts | ||
Derivatives, Fair Value [Line Items] | ||
Liability derivative | 2.3 | 4.2 |
Designated as Hedging Instrument | Other accrued liabilities | Cross-currency swap | ||
Derivatives, Fair Value [Line Items] | ||
Liability derivative | 111.3 | 96.1 |
Not Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives | 1.1 | 2.4 |
Not Designated as Hedging Instrument | Prepaid expenses and other current assets | Foreign currency forward contracts | ||
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives | 1.1 | 2.4 |
Not Designated as Hedging Instrument | Other accrued liabilities | Foreign currency forward contracts | ||
Derivatives, Fair Value [Line Items] | ||
Liability derivative | $ 0.8 | $ 1 |
Derivative Instruments and He_6
Derivative Instruments and Hedging Activities - Non-designated Derivatives (Details) - Not Designated as Hedging Instrument - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Apr. 02, 2022 | |
Foreign currency forward contracts | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Change in fair value of option contract | $ (1.8) | $ 0.1 |
Foreign currency forward contracts | Other expense (income), net | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Change in fair value of option contract | (1.2) | 0.5 |
Foreign currency forward contracts | Interest Expense, net | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Change in fair value of option contract | (0.6) | (0.4) |
Foreign currency options | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Change in fair value of option contract | $ 0 | $ 3.5 |
Derivative Instruments and He_7
Derivative Instruments and Hedging Activities - Effect of Cash Flow Hedges Included in AOCI (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Apr. 02, 2022 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Amount of Gain/(Loss) Recorded in OCI, Cash flow hedges | $ 18.2 | $ (7.2) |
Amount | 3.1 | (0.6) |
Gain (loss) from components excluded from assessment of cash flow hedge effectiveness, net, total | 0.1 | 0.2 |
Foreign currency cash flow hedge loss to be reclassified during next 12 months | 1.6 | |
Interest Expense, net | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Amount of gain or (loss) reclassified from AOCI into earnings , Foreign currency forward contracts | 0 | 0 |
Gain (loss) recognized in earnings on derivatives related to amounts excluded from effectiveness testing, Interest rate swap agreements | 0 | 0 |
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach | 0 | 0 |
Net Sales | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Amount of gain or (loss) reclassified from AOCI into earnings , Foreign currency forward contracts | 0.4 | 0.3 |
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach | 0 | 0 |
Cost of Sales | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Amount of gain or (loss) reclassified from AOCI into earnings , Foreign currency forward contracts | (0.2) | (0.4) |
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach | 0 | 0.1 |
Other expense (income), net | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Amount of gain or (loss) reclassified from AOCI into earnings , Foreign currency forward contracts | 0 | 0 |
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach | 0.1 | 0.1 |
Interest rate swap agreements | Interest Expense, net | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Amount of Gain/(Loss) Recorded in OCI, Cash flow hedges | 24.9 | 0 |
Amount of gain or (loss) reclassified from AOCI into earnings, Interest rate swap agreements | 2.9 | (0.5) |
Interest rate swap agreements | Net Sales | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Amount of gain or (loss) reclassified from AOCI into earnings, Interest rate swap agreements | 0 | 0 |
Interest rate swap agreements | Cost of Sales | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Amount of gain or (loss) reclassified from AOCI into earnings, Interest rate swap agreements | 0 | 0 |
Interest rate swap agreements | Other expense (income), net | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Amount of gain or (loss) reclassified from AOCI into earnings, Interest rate swap agreements | 0 | 0 |
Foreign currency forward contracts | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Amount of Gain/(Loss) Recorded in OCI, Cash flow hedges | (6.7) | (7.2) |
Cross-currency swap | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Amount of Gain/(Loss) Recorded in OCI, Net investment hedges | (23.7) | (4.6) |
Cross-currency swap | Interest Expense, net | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach | $ (6.5) | $ (0.5) |
Derivative Instruments and He_8
Derivative Instruments and Hedging Activities - Classification of Gain (Loss) of Cash Flow And Fair Value Hedging Relationships (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Apr. 02, 2022 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Net sales | $ 1,181.7 | $ 1,074.5 |
Cost of sales | 767.9 | 736.7 |
Interest expense, net | 43.7 | 35.8 |
Other expense (income), net | 0.5 | (1.1) |
Net Sales | ||
Foreign currency forward contracts | ||
Amount of gain or (loss) reclassified from AOCI into earnings | 0.4 | 0.3 |
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach | 0 | 0 |
Cost of Sales | ||
Foreign currency forward contracts | ||
Amount of gain or (loss) reclassified from AOCI into earnings | (0.2) | (0.4) |
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach | 0 | 0.1 |
Interest Expense, net | ||
Foreign currency forward contracts | ||
Amount of gain or (loss) reclassified from AOCI into earnings | 0 | 0 |
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach | 0 | 0 |
Other expense (income), net | ||
Foreign currency forward contracts | ||
Amount of gain or (loss) reclassified from AOCI into earnings | 0 | 0 |
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach | 0.1 | 0.1 |
Interest rate swap agreements | Net Sales | ||
Interest rate swap agreements | ||
Amount of gain or (loss) reclassified from AOCI into earnings | 0 | 0 |
Interest rate swap agreements | Cost of Sales | ||
Interest rate swap agreements | ||
Amount of gain or (loss) reclassified from AOCI into earnings | 0 | 0 |
Interest rate swap agreements | Interest Expense, net | ||
Interest rate swap agreements | ||
Amount of gain or (loss) reclassified from AOCI into earnings | 2.9 | (0.5) |
Interest rate swap agreements | Other expense (income), net | ||
Interest rate swap agreements | ||
Amount of gain or (loss) reclassified from AOCI into earnings | $ 0 | $ 0 |
Indebtedness - Schedule of Borr
Indebtedness - Schedule of Borrowings Outstanding (Details) - USD ($) $ in Millions | Jun. 15, 2023 | Apr. 01, 2023 | Dec. 31, 2022 | Jun. 15, 2022 |
Debt Instrument [Line Items] | ||||
Term loans | $ 1,582.4 | $ 1,588.3 | ||
Senior notes | 2,544.4 | 2,544.4 | ||
Other financing | 19.4 | 20.6 | ||
Unamortized premium (discount), net | (15.3) | (15.9) | ||
Deferred financing fees | (29.3) | (30.8) | ||
Total borrowings outstanding | 4,101.6 | 4,106.6 | ||
Current indebtedness | (38.8) | (36.2) | ||
Long-term debt, less current portion | 4,062.8 | 4,070.4 | ||
June 1, 2022 Through April 1, 2027 | ||||
Debt Instrument [Line Items] | ||||
Term loans | 490.6 | 493.8 | ||
June 1, 2022 Through April 1, 2029 | ||||
Debt Instrument [Line Items] | ||||
Term loans | $ 1,091.8 | 1,094.5 | ||
3.900% senior note due 2024 | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 3.90% | |||
Senior notes | $ 700 | 700 | ||
4.375% senior note due March 15, 2026 | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 4.375% | |||
Senior notes | $ 700 | 700 | ||
4.400% Senior Notes due June 15, 2030 | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 4.40% | 4.40% | ||
Senior notes | $ 750 | 750 | ||
5.300% Unsecured Senior Notes due November 15, 2043 | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 5.30% | |||
Senior notes | $ 90.5 | 90.5 | ||
4.900% Senior Loan due 2044 | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 4.90% | |||
Senior notes | $ 303.9 | $ 303.9 | ||
4.650% Senior Notes due June 15, 2030 | Forecast | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 4.65% | |||
3.150% Senior Notes due June 15, 2030 | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 3.15% | |||
Debt Instrument, Interest Rate, Percentage Cap | 0.020 |
Indebtedness - Narrative (Detai
Indebtedness - Narrative (Details) | 3 Months Ended | |||
Apr. 20, 2022 USD ($) | Apr. 01, 2023 USD ($) | Dec. 31, 2022 USD ($) | Jun. 15, 2022 | |
Debt Instrument [Line Items] | ||||
Outstanding balance | $ 0 | $ 0 | ||
Domestic Line of Credit | ||||
Debt Instrument [Line Items] | ||||
Secured net leverage ratio, maximum | 3 | |||
Maximum leverage ratio, subject to consummation of qualifying acquisitions | 3.25 | |||
2022 Revolver | ||||
Debt Instrument [Line Items] | ||||
Borrowings on line of credit | $ 0 | $ 0 | ||
2022 Revolver | Secured Debt | Line of Credit | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 1,000,000,000 | |||
Term of debt | 5 years | |||
New Term Loan A Facility | Secured Debt | Line of Credit | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 500,000,000 | |||
Term of debt | 5 years | |||
Principal repayments | 5,900,000 | |||
New Term Loan B Facility | Secured Debt | Line of Credit | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 1,100,000,000 | |||
Term of debt | 7 years | |||
Principal repayments | $ 5,900,000 | |||
5.300% Unsecured Senior Notes due November 15, 2043 | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 5.30% | |||
3.900% senior note due 2024 | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 3.90% | |||
4.375% senior note due March 15, 2026 | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 4.375% | |||
4.400% Senior Notes due June 15, 2030 | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 4.40% | 4.40% | ||
4.900% Senior Loan due 2044 | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 4.90% |
Earnings Per Share and Shareh_3
Earnings Per Share and Shareholders' Equity (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 01, 2023 | Apr. 02, 2022 | Oct. 31, 2018 | |
Numerator: | |||
Income (loss) from continuing operations | $ (1.1) | $ (1.3) | |
Income (loss) from discontinued operations, net of tax | (1.9) | (1.1) | |
Net income (loss) | $ (3) | $ (2.4) | |
Denominator: | |||
Weighted average shares outstanding for basic EPS (in shares) | 134,900,000 | 134,000,000 | |
Weighted average shares outstanding for diluted EPS (in shares) | 134,900,000 | 134,000,000 | |
Anti-dilutive share-based awards excluded from computation of diluted EPS (shares) | 0 | 0 | |
Stock repurchase program, authorized amount | $ 1,000 | ||
Repurchases of ordinary shares (shares) | 0 | 0 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Apr. 02, 2022 | |
Accumulated Other Comprehensive Income [Roll Forward] | ||
Beginning balance | $ 4,842.1 | $ 5,151.7 |
OCI before reclassifications | 23.8 | |
Amounts reclassified from AOCI | (3.1) | |
Other comprehensive income (loss), net of tax | 20.7 | (20.5) |
Ending balance | 4,833.9 | 5,104.5 |
Total AOCI | ||
Accumulated Other Comprehensive Income [Roll Forward] | ||
Beginning balance | (27) | 35.5 |
Other comprehensive income (loss), net of tax | 20.7 | (20.5) |
Ending balance | (6.3) | $ 15 |
Fair Value of Derivative Financial Instruments, net of tax | ||
Accumulated Other Comprehensive Income [Roll Forward] | ||
Beginning balance | 24.5 | |
OCI before reclassifications | (28.4) | |
Amounts reclassified from AOCI | (3.1) | |
Other comprehensive income (loss), net of tax | (31.5) | |
Ending balance | (7) | |
Foreign Currency Translation Adjustments | ||
Accumulated Other Comprehensive Income [Roll Forward] | ||
Beginning balance | (58.6) | |
OCI before reclassifications | 52.7 | |
Amounts reclassified from AOCI | 0 | |
Other comprehensive income (loss), net of tax | 52.7 | |
Ending balance | (5.9) | |
Posey-Retirement and Pension Liability Adjustments, net of tax | ||
Accumulated Other Comprehensive Income [Roll Forward] | ||
Beginning balance | 7.1 | |
OCI before reclassifications | (0.5) | |
Amounts reclassified from AOCI | 0 | |
Other comprehensive income (loss), net of tax | (0.5) | |
Ending balance | $ 6.6 |
Restructuring Charges (Details)
Restructuring Charges (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2023 | Apr. 02, 2022 | |
Restructuring Cost and Reserve [Line Items] | ||
Beginning balance | $ 19.8 | $ 6.9 |
Additional charges | 3.4 | 3.6 |
Payments | (8) | (2.1) |
Non-cash adjustments | 0.4 | (0.2) |
Ending balance | 15.6 | $ 8.2 |
Supply Chain Reinvention | ||
Restructuring Cost and Reserve [Line Items] | ||
Beginning balance | 2.2 | |
Additional charges | 2.6 | |
Payments | (4.4) | |
Non-cash adjustments | 0 | |
Ending balance | 0.4 | |
HRA Pharma Integration | ||
Restructuring Cost and Reserve [Line Items] | ||
Beginning balance | 13.3 | |
Additional charges | 0.8 | |
Payments | (2.6) | |
Non-cash adjustments | 0.3 | |
Ending balance | 11.8 | |
Other Initiatives | ||
Restructuring Cost and Reserve [Line Items] | ||
Beginning balance | 4.3 | |
Additional charges | 0 | |
Payments | (1) | |
Non-cash adjustments | 0.1 | |
Ending balance | $ 3.4 |
Restructuring Charges - Narrati
Restructuring Charges - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 15 Months Ended | |||
Apr. 01, 2023 | Apr. 02, 2022 | Apr. 01, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | $ 3.4 | $ 3.6 | |||
Restructuring reserve | 15.6 | 8.2 | $ 15.6 | $ 19.8 | $ 6.9 |
HRA Pharma Integration | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | 13.5 | ||||
Restructuring reserve | 11.8 | $ 11.8 | $ 13.3 | ||
CSCI | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | 0.9 | ||||
Corporate and Other | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | $ 1.2 | ||||
Unallocated Segment | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | $ 3.6 |
Income Taxes (Details)
Income Taxes (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||
Dec. 28, 2022 USD ($) | Jan. 13, 2021 USD ($) | Aug. 15, 2017 USD ($) | Apr. 01, 2023 USD ($) year | Apr. 02, 2022 | Dec. 31, 2012 USD ($) | Dec. 31, 2011 USD ($) | Dec. 31, 2010 USD ($) | Dec. 31, 2009 USD ($) | |
Income Tax Contingency [Line Items] | |||||||||
Effective income tax rate reconciliation, percent | 123.80% | 90.20% | |||||||
Income tax examination, penalties and interest expense | $ 134.1 | $ 24.7 | $ 40.1 | $ 41.8 | $ 27.5 | ||||
Cumulative deferred charge related to tax litigation | $ 111.6 | ||||||||
Royalty conceded on all omeprazole sales as a percent of refund claims (percent) | 5.24% | ||||||||
IRS Notice of Proposed Audit Adjustment from 2013, 2014 and 2015 | $ 141.6 | ||||||||
IRS Notice of Proposed Audit Adjustment for ANDA from 2013, 2014 and 2015 | 21.9 | ||||||||
Income tax examination, debts subject to limit of deductibility of interest expense | 7,500 | ||||||||
Settlement payment | $ 8.3 | ||||||||
Internal Revenue Service (IRS) | |||||||||
Income Tax Contingency [Line Items] | |||||||||
Income tax examination, number of taxable years | year | 4 | ||||||||
Minimum | |||||||||
Income Tax Contingency [Line Items] | |||||||||
Income tax examination, estimate of additional tax expense, excluding interest and penalties | 24 | ||||||||
Maximum | |||||||||
Income Tax Contingency [Line Items] | |||||||||
Income tax examination, estimate of additional tax expense, excluding interest and penalties | $ 112 |
Contingencies - Price Fixing La
Contingencies - Price Fixing Lawsuits (Details) | Jun. 30, 2020 manufacturer | Jun. 10, 2020 retailer pharmaceuticalProduct manufacturer plaintiffGroup | Jun. 21, 2017 genericPrescriptionPharmaceutical |
Loss Contingencies [Line Items] | |||
Number of generic prescription pharmaceuticals | genericPrescriptionPharmaceutical | 6 | ||
State Attorney General Complaint | |||
Loss Contingencies [Line Items] | |||
Number of additional states and territories | plaintiffGroup | 50 | ||
Number of manufacturers | 35 | ||
Number of former employees | retailer | 2 | ||
Number of generic prescription pharmaceuticals | pharmaceuticalProduct | 80 | ||
Canadian Class Action Complaint | |||
Loss Contingencies [Line Items] | |||
Number of manufacturers | 29 |
Contingencies - Securities Liti
Contingencies - Securities Litigation (Details) $ in Millions, ₪ in Billions | Jun. 28, 2017 ILS (₪) individual case $ / ₪ | Jun. 28, 2017 USD ($) individual case $ / ₪ | Nov. 14, 2019 class | Jun. 21, 2017 individual genericPrescriptionPharmaceutical |
Loss Contingencies [Line Items] | ||||
Number of current or former directors and officers | 11 | |||
Number of generic prescription pharmaceuticals | genericPrescriptionPharmaceutical | 6 | |||
Number of classes | class | 3 | |||
Israel Elec. Corp. Employees' Educ. Fund v. Perrigo Company plc, et al. | ||||
Loss Contingencies [Line Items] | ||||
Number of current or former directors and officers | 11 | 11 | ||
Preliminary class damages | ₪ 2.7 | $ 760 | ||
Foreign currency exchange rate, remeasurement | $ / ₪ | 0.28 | 0.28 | ||
Number of cases dismissed | case | 2 | 2 |
Contingencies - Other Matters (
Contingencies - Other Matters (Details) $ in Millions | 1 Months Ended | 3 Months Ended | |
Feb. 29, 2020 complaint claim | Apr. 01, 2023 USD ($) lawsuit tender | May 31, 2021 policyPeriod | |
Loss Contingencies [Line Items] | |||
Estimated litigation liability | $ | $ 67.6 | ||
Loss contingency, receivable, additions | $ | $ 37.2 | ||
Number of policy periods | policyPeriod | 1 | ||
Talcum Powder Litigation | |||
Loss Contingencies [Line Items] | |||
Pending claims, number | lawsuit | 90 | ||
Number of tenders accepted | tender | 1 | ||
Ranitidine Litigation | |||
Loss Contingencies [Line Items] | |||
Number of master complaints | 3 | ||
Number of master complaints naming company | 3 | ||
Number of appeals of master complaints | 1 | ||
Number of appeals of personal injury claims | claim | 2 | ||
Number of personal injury lawsuits | lawsuit | 352 |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 01, 2023 | Apr. 02, 2022 | Dec. 31, 2022 | |
Segment Reporting Information [Line Items] | |||
Assets | $ 10,954.9 | $ 11,017.3 | |
Net sales | 1,181.7 | $ 1,074.5 | |
Operating Income (Loss) | 48.5 | 21.7 | |
Intangible Asset Amortization | 65.4 | 48.5 | |
Unallocated | |||
Segment Reporting Information [Line Items] | |||
Net sales | 0 | 0 | |
Operating Income (Loss) | (56) | (73) | |
Intangible Asset Amortization | 0 | 0 | |
CSCA | |||
Segment Reporting Information [Line Items] | |||
Assets | 5,057.7 | 5,134.1 | |
Net sales | 763.7 | 710 | |
CSCA | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Net sales | 763.7 | 710 | |
Operating Income (Loss) | 83.2 | 78.5 | |
Intangible Asset Amortization | 13.9 | 12.4 | |
CSCI | |||
Segment Reporting Information [Line Items] | |||
Assets | 5,897.2 | $ 5,883.2 | |
Net sales | 418.1 | 364.5 | |
CSCI | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Net sales | 418.1 | 364.5 | |
Operating Income (Loss) | 21.3 | 16.2 | |
Intangible Asset Amortization | $ 51.5 | $ 36.1 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Millions | May 05, 2023 | Jan. 20, 2022 | May 07, 2020 | Jan. 13, 2021 | Apr. 26, 2019 |
Subsequent Event [Line Items] | |||||
IRS notice of proposed adjustment amount from 2011,2012 and 2013 audit of Athena, including penalty | $ 843 | ||||
IRS notice of proposed adjustment, penalty (percent) | 40% | ||||
Income tax examination, debts subject to limit of deductibility of interest expense | $ 7,500 | ||||
Interest rate cap on debts for U.S. Federal tax purposes, as percent of Applicable Federal Rate | 130% | ||||
Income tax examination, reduction in blended interest rate due to cap for U.S. Federal tax purposes | 4% | ||||
IRS notice of proposed audit adjustment to reduce deductible interest expense for fiscal years 2014 and 2015 | $ 414.7 | ||||
Blended interest rate proposed on debts | 4.36% | ||||
Blended interest rate in revenue agent report | 2.57% | ||||
Stated blended interest rate | 6.80% | ||||
Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Blended interest rate proposed on debts | 5.44% | ||||
Interest expense | $ (153.4) |