Company: PRGO
Filing Date: 2025-05-07
Form Type: 10-Q
Source: 0001585364-25-000056
Chunk: 253

Company: PERRIGO Co plc
Filing Date: 2025-05-07
Form: 10-Q
Item: Item 15
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 positions the Company to win in self-care. 

As part of the Company's sustainable, value accretive growth strategy, the Company launched Project Energize - a global investment and efficiency program to drive the next evolution of capabilities and organizational agility. This three-year program is expected to produce significant benefits in the Company’s long-term business performance by enabling our One Perrigo growth strategy, increasing organizational agility and mitigating impacts from stabilizing and strengthening the infant formula business. 

Project Energize was initiated in the first quarter of 2024, subject to local law and consultation requirements, and is expected to deliver annualized pre-tax savings in the range of $140 million to $170 million by the end of 2026. The Company expects an annual reinvestment of approximately $40 million to $60 million of these savings to drive its business model. Restructuring and related charges associated with these actions are estimated 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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