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Perrigo is a leading global consumer-focused self-care company. Our vision is to making lives better by bringing “Quality, Affordable Self-Care Products” that consumers trust everywhere they are sold. The Company is a leading provider of health and wellness solutions that enhance individual well-being by empowering consumers to proactively prevent or treat conditions that can be self-managed.

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Perrigo Company Reports Third Quarter Fiscal 2003 Earnings of $0.20 Per Share
PRNewswire-FirstCall
ALLEGAN, Mich.

The Perrigo Company (NASDAQ: PRGO) today announced results for the third quarter and nine months of fiscal 2003 ended March 29, 2003.

                      Perrigo Company (NASDAQ: PRGO)
                 (in thousands, except per share amounts)

                                   Third Quarter           Year-To-Date
                                 2003        2002        2003        2002
  Sales                        $202,616    $198,491    $643,352    $644,301
  Net Income                    $14,132     $17,910     $49,724     $44,861
  Diluted EPS                     $0.20       $0.24       $0.70       $0.60
  Diluted Shares                 70,601      73,859      70,967      74,939

Net sales for the third quarter were $202.6 million, an increase of two percent compared with $198.5 million last year. Net income was $14.1 million, or $0.20 per share, compared with net income of $17.9 million, or $0.24 per share a year ago, which included income from the settlement of a lawsuit of $5.0 million after-tax, or $0.07 per share. Without the lawsuit settlement, earnings on an operating basis were $12.9 million, or $0.17 per share, last year.

Commenting on the third quarter, David T. Gibbons, Perrigo President and Chief Executive Officer, said, "We delivered excellent results this quarter. Our improved operational efficiency and rising productivity were significant contributors to higher gross profits. Higher-than-anticipated sales volume and good product mix also helped profits. Lastly, we benefited from good expense control and improved results at our Mexican operation. Cash flow from operations was $45 million during the quarter and stands at $82 million year-to-date. We continue to be virtually debt-free and remain in a very strong financial position."

Net sales for the nine months ended March 29, 2003, were $643.4 million compared with $644.3 million a year ago. Net income for the nine months improved to $49.7 million, or $0.70 per share, from $44.9 million, or $0.60 per share for last year. Excluding proceeds from a lawsuit settlement in the first quarter this year of $2.0 million after-tax, or $0.03 per share, and income from the settlement of a lawsuit last year of $5.0 million after-tax, or $0.07 per share, net income on an operating basis increased 20 percent to $47.7 million, or $0.67 per share, from $39.9 million, or $0.53 per share, for the prior year.

Commenting further, Mr. Gibbons stated, "Over the past few quarters, our earnings have been driven by operational benefits, specifically, improved operating efficiencies and supply chain management. We have been making good progress, not driven by any single initiative, but from contributions across many functional areas. I am very proud of our employees' combined efforts, and I'm pleased that we continue to outpace our own goals. We feel very good about our operational momentum, and look forward to the upcoming launch of store brand equivalents to the branded allergy medication Claritin®.

"In line with our historical seasonal pattern, we anticipate sequentially lower fourth-quarter sales and margins and expect earnings of $0.04 to $0.05 per share. With year-to-date results of $0.70 per share, we now project earnings of $0.74 to $0.75 for the full year, compared with $0.60 per share for fiscal 2003, restated for expensing of stock options."

The Company noted that, effective with the fiscal second quarter ended December 28, 2002, it elected to expense stock option compensation. All prior periods have been restated to reflect the compensation cost that would have been recognized had the stock option expense been applied to all awards granted after July 1, 1995. Please refer to the restated results in the summary table at the end of this announcement.

The Company is furnishing this earnings release to the Securities and Exchange Commission via Form 8-K and it is hereby incorporated by reference. The information provided on Form 8-K includes a summary of each non-GAAP financial measure included in this earnings release and the reasons management believes these non-GAAP financial measures are useful to investors.

Perrigo will host a conference call to discuss third quarter fiscal 2003 results at 11:00 a.m. (EDT) today. The call and replay will be available via webcast on the Company's web site at www.perrigo.com/investor or by phone, toll free, 888-489-0147. A taped replay of the call will be available beginning at approximately 2:30 p.m. (EDT) Wednesday, April 23. To listen to the replay, call 800-642-1687, access code 9713471.

Perrigo Company is the nation's largest manufacturer of over-the-counter (non-prescription) pharmaceutical and nutritional products sold by supermarket, drug, and mass merchandise chains under their own labels. The Company's products include over-the-counter pharmaceuticals such as analgesics, cough and cold remedies, gastrointestinal, and feminine hygiene products, and nutritional products, such as vitamins, nutritional supplements and nutritional drinks. Visit Perrigo on the Internet (www.perrigo.com ).

Note: Certain statements in this press release are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor created thereby. These statements relate to future events or the Company's future financial performance and involve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of the Company or its industry to be materially different from those expressed or implied by any forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as "may," "will," "could," "would," "should," "expect," "plan," "anticipate," "intend," "believe," "estimate," "predict," "potential" or other comparable terminology. Please see the "Cautionary Note Regarding Forward-Looking Statements" on pages 23-27 of the Company's Form 10-K for the year ended June 29, 2002 for a discussion of certain important factors that relate to forward-looking statements contained in this press release. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. Unless otherwise required by applicable securities laws, the Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

                             PERRIGO COMPANY
               CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                 (in thousands, except per share amounts)
                               (unaudited)

                                      Third Quarter        Year-To-Date
                                     2003       2002      2003       2002
                                                (as                  (as
                                              restated)            restated)

  Net sales                        $202,616   $198,491  $643,352   $644,301
  Cost of sales                     143,910    141,883   458,671    472,650
  Gross profit                       58,706     56,608   184,681    171,651

  Operating expenses
     Distribution                     3,814      4,048    11,924     12,330
     Research and development         5,468      5,762    16,237     17,465
     Selling and administration      27,833     26,264    81,983     76,089
       Subtotal                      37,115     36,074   110,144    105,884
     Restructuring                        -          -         -      2,046
     Unusual litigation                   -     (7,813)   (3,128)    (7,813)
       Total                         37,115     28,261   107,016    100,117

  Operating income                   21,591     28,347    77,665     71,534
  Interest and other, net            (1,307)      (220)   (2,029)      (496)

  Income before income taxes         22,898     28,567    79,694     72,030
  Income tax expense                  8,766     10,657    29,970     27,169

  Net income                        $14,132    $17,910   $49,724    $44,861

  Earnings per share
     Basic                            $0.20      $0.25     $0.71      $0.61
     Diluted                          $0.20      $0.24     $0.70      $0.60

  Weighted average shares
   outstanding:
     Basic                           69,337     72,690    69,781     73,451
     Diluted                         70,601     73,859    70,967     74,939

  Dividends declared per share        $0.03        $ -     $0.03        $ -


                             PERRIGO COMPANY
                  CONDENSED CONSOLIDATED BALANCE SHEETS
                              (in thousands)

                                         March 29,    June 29,   March 30,
                                            2003        2002        2002
                                                        (as     (unaudited)
  Assets                                (unaudited)   restated)     (as
  Current assets                                                  restated)
     Cash and cash equivalents            $105,233     $76,824     $36,674
     Accounts receivable, net of
      allowances                            84,973      82,560      98,755
     Inventories, net of allowances        156,043     155,611     145,379
     Prepaid expenses and other current
      assets                                 6,064       6,896       8,936
     Current deferred income taxes          23,603      19,860      19,364
            Total current assets           375,916     341,751     309,108

  Property and equipment                   417,673     399,461     396,398
     Less accumulated depreciation         206,907     188,417     184,943
                                           210,766     211,044     211,455

  Goodwill, net                             35,919      35,919      47,471
  Other                                      6,127       5,073       5,156
                                          $628,728    $593,787    $573,190

  Liabilities and Shareholders' Equity
  Current liabilities
     Accounts payable                      $73,489     $74,449     $61,111
     Notes payable                           8,741       8,338       7,321
     Payrolls and related taxes             34,539      31,338      27,733
     Accrued expenses                       36,469      32,721      31,808
     Income taxes                            8,815       8,088      10,134
            Total current liabilities      162,053     154,934     138,107

  Deferred income taxes                     25,146      18,295      16,180
  Other long-term liabilities                3,193       2,396       2,685

  Shareholders' equity
     Preferred stock, without par
      value, 10,000 shares authorized            -           -           -
     Common stock, without par value,
      200,000 shares authorized             82,564     110,698     108,585
     Unearned compensation                    (262)       (608)       (756)
     Accumulated other comprehensive
      income                                   348         373         619
     Retained earnings                     355,686     307,699     307,770
            Total shareholders' equity     438,336     418,162     416,218
                                          $628,728    $593,787    $573,190

  Supplemental Disclosures of Balance
   Sheet Information
     Allowance for doubtful accounts        $9,907      $7,569      $8,809
     Allowance for inventory               $19,806     $21,360     $23,448
     Working capital                      $213,863    $186,817    $171,001
     Preferred stock, shares issued              -           -           -
     Common stock, shares issued            69,425      72,550      72,471


                             PERRIGO COMPANY
             CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                              (in thousands)
                               (unaudited)

                                                         Year-To-Date
                                                    2003             2002
      Cash Flows From (For) Operating Activities:                    (as
                                                                   restated)
        Net income                                $49,724          $44,861
        Adjustments to derive cash flows:
           Depreciation and amortization           19,777           17,968
           Compensation - stock options             3,998            4,549
           Deferred income taxes                    3,108               92
           Restructuring, net of cash                   -            2,046

     Changes in operating assets and
      liabilities, net of restructuring:
           Accounts receivable                     (2,845)          (5,102)
           Inventories                               (712)          15,784
           Current income taxes                       718          (10,412)
           Accounts payable                          (750)         (23,256)
           Payroll and related taxes                3,195            1,617
           Accrued expenses                         4,038            5,951
           Other                                    1,682             (752)
              Net cash from operating activities   81,933           53,346

      Cash Flows (For) From Investing Activities:
        Additions to property and equipment       (19,458)         (17,386)
        Proceeds from sale of assets
         held for sale                                  -           14,161
        Investment in equity subsidiaries          (1,233)             (41)
        Other                                           -             (385)
              Net cash for investing activities   (20,691)          (3,651)

     Cash Flows (For) From Financing Activities:
        Borrowings (repayments) of
         short-term debt, net                         776           (5,554)
        Tax benefit of stock transactions             153            1,669
        Issuance of common stock                    1,353           10,232
        Repurchase of common stock                (33,682)         (31,923)
        Cash dividends                             (1,737)               -
        Other                                           -            1,584
              Net cash for financing activities   (33,137)         (23,992)

     Net Increase in Cash and Cash Equivalents     28,105           25,703
     Cash and Cash Equivalents, at
      Beginning of Period                          76,824           11,016
     Effect of exchange rate changes on cash          304              (45)
     Cash and Cash Equivalents, at End
      of Period                                  $105,233          $36,674

     Supplemental Disclosures of Cash Flow Information:
        Interest paid                                $598           $1,266
        Income taxes paid                         $26,854          $36,939



                             PERRIGO COMPANY
                    STOCK OPTION COMPENSATION EXPENSE
                       IMPACT ON NET INCOME AND EPS
                 (in thousands, except per share amounts)
                               (unaudited)

                                           Third Quarter     Year-To-Date
                                           2003     2002     2003     2002
  Net income before adoption             $15,507  $19,261  $53,565  $48,916
  Compensation expenses (net of tax
   benefit)                                1,375    1,351    3,841    4,055
  Net income after adoption              $14,132  $17,910  $49,724  $44,861

  Weighted average shares outstanding:
    Basic                                 69,337   72,690   69,781   73,451
    Diluted
        Before adoption                   71,041   74,309   71,395   75,474
        After adoption                    70,601   73,859   70,967   74,939

  Basic EPS
    Before adoption                        $0.22    $0.26    $0.77    $0.67
    After adoption                         $0.20    $0.25    $0.71    $0.61

  Diluted EPS
    Before adoption                        $0.22    $0.26    $0.75    $0.65
    After adoption                         $0.20    $0.24    $0.70    $0.60


                             PERRIGO COMPANY
                   RECONCILIATION OF NON-GAAP MEASURES
                 (in thousands, except per share amounts)
                               (unaudited)

                                           Third Quarter      Year-To-Date
                                           2003     2002     2003     2002
  Net income (GAAP)                      $14,132  $17,910  $49,724  $44,861
  Less: unusual litigation, net of tax         -    5,000    2,000    5,000
  Net income before unusual litigation   $14,132  $12,910  $47,724  $39,861

  Earnings per share:
     Basic                                 $0.20    $0.18    $0.68    $0.54
     Diluted                               $0.20    $0.17    $0.67    $0.53

  Weighted average shares outstanding:
     Basic                                69,337   72,690   69,781   73,451
     Diluted                              70,601   73,859   70,967   74,939

SOURCE: Perrigo Company

CONTACT: Ernest J. Schenk, Manager, Investor Relations and Communication
of Perrigo Company, +1-269-673-9212, E-mail: eschenk@perrigo.com

Web site: http://www.perrigo.com/investor

Web site: http://www.perrigo.com/

Company News On-Call: http://www.prnewswire.com/gh/cnoc/comp/699550.html