Company: PRGO
Filing Date: 2025-08-06
Form Type: 10-Q
Source: 0001585364-25-000122
Chunk: 189

Company: PERRIGO Co plc
Filing Date: 2025-08-06
Form: 10-Q
Item: Item 7
Chunk 189
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 to be in the range of $140 million to $160 million, including $20 million to $40 million in investments to enhance capabilities, and are expected to be substantially incurred by the end of 2026. Restructuring activities as part of Project Energize are expected to result in the net reduction of approximately 6% of total Perrigo roles. Refer to Item 1. Note 14 for further details on restructuring charges.

Nutrition Network Optimization

In 2025, Perrigo initiated the Nutrition Network Optimization project to optimize our infant formula manufacturing footprint, upgrade packaging capabilities, harmonize quality processes, and enhance our research and development capabilities. We plan to invest approximately $240 million into our infant formula production network over the next three years as a strategic move expected to provide substantial cash returns and secure this business over the long-term. By enhancing our production capabilities, we can achieve significant cost reductions through economies of scale and improved operational efficiencies, leading to higher margins. Additionally, this investment will position us well in the current evolving regulatory landscape, promoting compliance and reducing the risk of costly disruptions, while facilitating greater access of our essential products to more consumers. 

As we expect cash generation from 2025 to 2027 to offset a piece of the investment, we anticipate recouping our investment within two years post project completion. Refer to Item 1. Note 14 for further details on restructuring charges.

Market Factors and Trends 

Macroeconomic Uncertainty

Current macroeconomic conditions remain dynamic, including impacts from inflation and interest rates, volatile changes in foreign currency exchange rates, tariffs, political unrest and uncertainty and legislative and regulatory 

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Perrigo Company plc - Item 2Executive Overview

changes. Any causes of market size contraction could reduce our sales or erode our operating margin and consequently reduce our net earnings and cash flows. As a result of these dynamic conditions and uncertainties, we have modified, and may further modify, our operations and strategic initiatives, including by adjusting our investment priorities, reallocating resources, or delaying specific initiatives, such as deferring capital expenditures on the Nutrition Network Optimization project and seeking further working capital improvements.

Current uncertainties arising from increased tariffs on imported products could have an adverse effect on our Company. In 2025, the U.S. government announced new or additional tariffs on products imported from many countries and individualized "reciprocal" tariffs on countries with which the U.S. has the largest trade deficits. While some tariffs have become effective, others have been temporarily suspended or permanently repealed and the U.S