ALLEGAN, Mich., Oct. 24 /PRNewswire-FirstCall/ --
The Perrigo Company (Nasdaq: PRGO) today announced results for the first
quarter of fiscal 2003 ended September 28, 2002.
Perrigo Company (Nasdaq: PRGO)
(In thousands, except per share amounts)
Fiscal 2003 Fiscal 2002
1st Quarter Ended 1st Quarter Ended
Sales $213,215 $217,116
Net Income $20,011 $13,090
Diluted Shares 72,136 76,925
Diluted EPS $0.28 $0.17
Net sales for fiscal 2003's first quarter were $213.2 million, a decrease
of two percent from $217.1 million last year. Net income was $20.0 million,
or $0.28 per share, including a lawsuit settlement of $2.0 million after-tax,
or $0.03 per share. Excluding the lawsuit settlement, net income in the
quarter was $18.0 million, or $0.25 per share compared with $13.1 million, or
$0.17 per share, a year ago.
"We are pleased with the excellent results recorded in our fiscal first
quarter," stated David T. Gibbons, Perrigo's President and Chief Executive
Officer. "The strong start to fiscal 2003 was achieved despite a difficult
sales comparison from the successful new product sell-in of famotidine
(Pepcid(R)) a year ago. Earnings reflect the execution of our key strategies
and the collective positive effect from several factors. Among the key
factors this quarter were the operational improvement initiatives begun last
year. Our continuing focus on manufacturing efficiencies and costs have
benefited margins. Other key factors were a favorable product mix, improved
net pricing, and excellent inventory management. Inventories declined $7.4
million, or four percent from last year's first quarter, allowing us to manage
inventory obsolescence expense closely."
Mr. Gibbons also noted, "With operational improvements taking hold, we
continue to generate cash and our balance sheet remains very strong. In the
quarter, our cash position and operating cash flow of $8.8 million helped us
buy back 3.1 million shares of the Company's common stock under our ongoing
share repurchase program.
"We have had a great start to the year and feel confident that we will
continue to make progress toward meeting our long-term financial goals. The
cough, cold and flu season, however, still lies ahead, and the timing and
magnitude of the season are not yet clear. It's off to a slow start so far.
Until we begin to see signs as to how this cough, cold and flu season will
compare with last year's, we are reluctant to change our relatively flat
operating earnings expectations for fiscal 2003."
Continuing, Gibbons said, "Another concern is the impact on our store
brand allergy business of the likely switch of Claritin(R) from prescription
to over-the-counter (OTC) status. While this switch will benefit us in fiscal
2004, a switch to OTC in December or January will impact the sales of existing
allergy products during the third and fourth quarters of fiscal 2003. We do,
however, remain confident the strategies that have helped us to this point
will help us grow our store brand market leadership position in the future.
Specifically, we continue to improve upon our low-cost producer status, invest
in research and development, and generate cash."
"Relatively flat" earnings expectations for fiscal 2003 are prior to
accounting for $0.03 per share from this quarter's lawsuit settlement income
and an additional $0.02 to $0.03 per share for the year since there will be
fewer shares outstanding as a result of the share repurchase program.
Perrigo will host a conference call to discuss first 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 http://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) Thursday, October 24. To listen to
the replay, call 800-642-1687, access code 6217377 (outside the United States,
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 (http://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. 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.