Company: PRGO
Filing Date: 2025-02-28
Form Type: 10-K
Source: 0001585364-25-000014
Chunk: 31

Company: PERRIGO Co plc
Filing Date: 2025-02-28
Form: 10-K
Item: Item 7
Chunk 31
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 Corporate led initiatives, the Supply Chain Reinvention program, and Project Energize, and, as a result, the reporting unit is sensitive to changes in estimates related to the Supply Chain Reinvention Program and Project Energize. Reductions in the net projected benefits could represent a potential indicator of impairment requiring further impairment analysis. 

Based on the sensitivity of the discount rate assumptions on these analyses, an increase in the discount rate over the next twelve months could negatively impact the estimated fair value of the reporting units and lead to a future impairment. Certain macroeconomic factors which are not controlled by the reporting units, such as rising inflation or interest rates, could cause an increase in the discount rate to occur. Deterioration in performance of our reporting units over the next twelve months, such as lower than expected revenue or profitability that has a sustained impact on future periods, could also represent potential indicators of impairment requiring further impairment analysis. We have experienced significant decreases in our market capitalization. Given the sensitivity of assumptions on control premium, further decreases in our market capitalization in the next twelve months, could represent a potential impairment indicator requiring further impairment analysis.

During the three months ending June 29, 2024, we recorded goodwill impairment charge of $22.1 million related to our now divested Rare Disease reporting unit. During the three months ended September 28, 2024, we recorded impairment charge of $5.4 million for our CSCI reporting unit related to the now divested Hospital & Specialty disposal group. During 2023, we recorded goodwill impairment charges of $90.0 million. We continue to monitor the progress of our reporting units and assess them for potential impairment should impairment indicators arise, as applicable, and at least annually during our fourth quarter impairment testing.

See Item 8. Note 9 and Note 10 for further information.

Recently Issued Accounting Standards Pronouncements

See Item 8. Note 1 for information regarding recently issued accounting standards.