Perrigo Reports Record Second Quarter Revenue, Adjusted Earnings and Operating Cash Flow

Perrigo Reports Record Second Quarter Revenue, Adjusted Earnings and Operating
                                  Cash Flow

- Fiscal second quarter adjusted net income increased 14% to a record $128
million, or $1.36 per diluted share.

- Fiscal second quarter GAAP net income increased 6% to $106 million, or $1.12
per diluted share.

- Reports record second quarter operating cash flow of $185 million.

- Management confirms previously provided full-year fiscal 2013 adjusted
earnings per share to be in a range of $5.45 to $5.65 per diluted share and
reported earnings to be between $4.73 and $4.93 per diluted share.

PR Newswire

ALLEGAN, Mich., Feb. 1, 2013

ALLEGAN, Mich., Feb. 1, 2013 /PRNewswire/ -- Perrigo Company (Nasdaq: PRGO;
TASE: PRGO) today announced results for its second quarter ended December 29,
2012.

(Logo: http://photos.prnewswire.com/prnh/20120301/DE62255LOGO )

Perrigo's Chairman and CEO Joseph C. Papa commented, "The team delivered on
another high-quality quarter with all-time record quarterly revenue, as well
as record second quarter adjusted earnings and operating cash flow. The
Consumer Healthcare segment had another great quarter with strong store brand
OTC market share growth. The team is working hard to integrate and expand the
reach of our recent acquisition of Sergeant's Pet Care Products, Inc.
("Sergeant's"). Retailers are excited about the launch of our new plastic
container in the infant formula category, as evidenced by their increased
marketing and advertising efforts promoting the store brand value proposition.
We continue to deliver on our top priority of providing quality, affordable
healthcare products for consumers and customers."

Note that fiscal second quarter 2012 included an extra week of operations
compared to fiscal second quarter 2013.

Refer to Table I at the end of this press release for adjustments in the
current year and prior year periods and additional non-GAAP information. The
Company's reported results are summarized in the attached Condensed
Consolidated Statements of Income, Balance Sheets and Cash Flows.

Perrigo Company

(in thousands, except per share amounts)

(see the attached Table I for reconciliation to GAAP numbers)
                       Fiscal 2013   Fiscal 2012
                       Second        Second

                       Quarter       Quarter       YoY

                       Ended         Ended
                       12/29/2012    12/31/2011    % Change
Net Sales              $882,959      $838,170      +5.3%
Reported Net Income    $105,955      $99,739       +6.2%
Adjusted Net Income    $128,083      $112,431      +13.9%
Reported Diluted EPS   $1.12         $1.06         +5.7%
Adjusted Diluted EPS   $1.36         $1.20         +13.3%
Diluted Shares         94,450        94,043        +0.4%



Second Quarter Results

Net sales in the quarter were $883 million, an increase of 5% over the second
quarter of fiscal 2012, driven primarily by $34 million attributable to the
Sergeant's and CanAm Care, LLC ("CanAm") acquisitions and new product sales of
$25 million, partially offset by decreases in sales of certain existing
products in the Rx segment in addition to the impact of the extra week of
operations experienced in the second quarter of fiscal 2012. Excluding charges
as outlined in Table I at the end of this release, second quarter fiscal 2013
adjusted net income increased 14% to $128 million, or $1.36 per diluted share.
Reported net income increased 6% to $106 million, or $1.12 per diluted share.



Consumer Healthcare



Consumer Healthcare Segment

(in thousands)

(see the attached Table II for reconciliation to GAAP numbers)
                           Fiscal 2013   Fiscal 2012
                           Second        Second

                           Quarter       Quarter      YoY

                           Ended         Ended
                           12/29/2012    12/31/2011   % Change
Net Sales                  $539,288      $471,277     +14.4%
Reported Gross Profit      $162,254      $148,813     +9.0%
Adjusted Gross Profit      $173,168      $149,819     +15.6%
Reported Operating Income  $86,078       $82,250      +4.7%
Adjusted Operating Income  $98,641       $84,470      +16.8%
Reported Gross Margin      30.1%         31.6%        -150 bps
Adjusted Gross Margin      32.1%         31.8%        +30 bps
Reported Operating Margin  16.0%         17.5%        -150 bps
Adjusted Operating Margin  18.3%         17.9%        +40 bps



Consumer Healthcare segment net sales increased 14% to $539 million, driven by
an increase in sales of existing products of $38 million (contract,
analgesics and smoking cessation categories), $34 million attributable to the
Sergeant's and CanAm acquisitions, and new product sales of $12 million
(cough/cold, dermatologic and gastrointestinal categories). These combined
increases were partially offset by a decline of $13 million in sales of
existing products (allergy products and gastrointestinal category) and
approximately $5 million in discontinued products.

Adjusted gross and operating margins expanded 30 and 40 basis points,
respectively, due to new products and increased manufacturing efficiencies.
The disparity between the reported and adjusted margins was due primarily to a
charge of approximately $8 million to cost of sales as a result of the step-up
of inventory acquired and sold related to the Sergeant's acquisition.



Nutritionals



Nutritionals Segment

(in thousands)

(see the attached Table II for reconciliation to GAAP numbers)
                           Fiscal 2013  Fiscal 2012
                           Second       Second       

                           Quarter      Quarter      

                           Ended        Ended        YoY
                           12/29/2012   12/31/2011   % Change
Net Sales                  $121,938     $128,147     -4.8%
Reported Gross Profit      $30,145      $28,230      +6.8%
Adjusted Gross Profit      $33,194      $31,252      +6.2%
Reported Operating Income  $7,160       $4,552       +57.3%
Adjusted Operating Income  $14,470      $11,189      +29.3%
Reported Gross Margin      24.7%        22.0%        +270 bps
Adjusted Gross Margin      27.2%        24.4%        +280 bps
Reported Operating Margin  5.9%         3.6%         +230 bps
Adjusted Operating Margin  11.9%        8.7%         +320 bps



The Nutritionals segment reported second quarter net sales of $122 million,
compared with $128 million a year ago, as existing product sales declined $9
million due primarily to the extra week of sales in fiscal 2012, partially
offset by new product sales of $3 million (Vitamins, Minerals and Supplements
and infant foods categories).

Second quarter gross profit and margin increased due primarily to price
increases and favorable product mix. Operating profit and margin were
positively impacted by lower employee-related expenses, along with the absence
of operating expenses related to the Company's Florida location, which was
closed in the fourth quarter of fiscal 2012.



Rx Pharmaceuticals



Rx Pharmaceuticals Segment

(in thousands)

(see the attached Table II for reconciliation to GAAP numbers)
                           Fiscal 2013  Fiscal 2012
                           Second       Second       

                           Quarter      Quarter      

                           Ended        Ended        YoY
                           12/29/2012   12/31/2011   % Change
Net Sales                  $162,541     $177,196     -8.3%
Reported Gross Profit      $86,036      $91,378      -5.8%
Adjusted Gross Profit      $94,493      $99,347      -4.9%
Reported Operating Income  $64,059      $69,974      -8.5%
Adjusted Operating Income  $74,042      $78,542      -5.7%
Reported Gross Margin      52.9%        51.6%        +130 bps
Adjusted Gross Margin      58.1%        56.1%        +200 bps
Reported Operating Margin  39.4%        39.5%        -10 bps
Adjusted Operating Margin  45.6%        44.3%        +130 bps



The Rx Pharmaceuticals segment second quarter net sales decreased 8% as
existing product sales were lower year-over-year by $11 million due to
increased competition on certain existing products. This decrease was
partially offset by new product sales of $9 million. The extra week of
operations in second quarter fiscal 2012 accounted for most of the difference
in net sales in the segment compared to fiscal 2012.

The adjusted gross margin increased due primarily to favorable product mix as
well as higher margin on new product sales. The adjusted operating margin was
impacted by higher distribution, selling, general and administrative costs.



API



API Segment

(in thousands)

(see the attached Table II for reconciliation to GAAP numbers)
                           Fiscal 2013  Fiscal 2012
                           Second       Second       

                           Quarter      Quarter      

                           Ended        Ended        YoY
                           12/29/2012   12/31/2011   % Change
Net Sales                  $40,854      $42,752      -4.4%
Reported Gross Profit      $22,883      $20,151      +13.6%
Adjusted Gross Profit      $23,364      $20,647      +13.2%
Reported Operating Income  $13,820      $11,693      +18.2%
Adjusted Operating Income  $14,301      $12,189      +17.3%
Reported Gross Margin      56.0%        47.1%        +890 bps
Adjusted Gross Margin      57.2%        48.3%        +890 bps
Reported Operating Margin  33.8%        27.4%        +640 bps
Adjusted Operating Margin  35.0%        28.5%        +650 bps

The API segment's net sales declined by 4% to $41 million due primarily to a
decrease in existing product sales of approximately $5 million as a result of
increased competition, partially offset by $4 million related to the continued
successful launch of a customer's product.

Gross and operating margins were positively impacted by the product launch
referred to above, along with favorable mix of existing product sales,
partially offset by higher research and development and selling, general and
administrative expenses.

Other

The Other category reported second quarter net sales of $18 million, compared
with approximately $19 million a year ago, due primarily to the impact of
unfavorable changes in foreign currency exchange rates.

Adjusted operating income was $1 million, representing a decrease in adjusted
operating margin of 140 basis points from last year due to product mix.

Closing

Chairman, President and CEO Joseph C. Papa concluded, "Once again, the
strength of our diversified business model was evident this quarter. Our
Consumer Healthcare manufacturing operations are producing higher volumes and
are operating more efficiently than at any time in our history. The Company
continues to use our disciplined ROIC-centric process to make positive
investments in operations and products. We expect further growth in store
brand market penetration and strong new product launches, resulting in
significant savings to consumers with quality, affordable healthcare
products."

The Company expects fiscal 2013 reported earnings to be between $4.73 and
$4.93 per diluted share as compared to $4.18 in fiscal 2012. Excluding the
charges outlined in Table III at the end of this release, the Company
continues to expect fiscal 2013 adjusted earnings to be between $5.45 and
$5.65 per diluted share as compared to $4.99 in fiscal 2012. This range
implies a year-over-year growth rate in adjusted earnings of 9% to 13% over
fiscal 2012's adjusted earnings from continuing operations per diluted share.

The conference call will be available live via webcast to interested parties
on the Perrigo website http://perrigo.investorroom.com/events-webcasts or by
phone at 877-248-9413, International 973-582-2737, and reference ID# 87314407.
A taped replay of the call will be available beginning at approximately 1:00
p.m. (ET) Friday, February 1, 2013 until midnight Friday, February 15, 2013.
To listen to the replay, dial 855-859-2056, International 404-537-3406, and
use access code 87314407.

From its beginnings as a packager of generic home remedies in 1887, Perrigo
Company, based in Allegan, Michigan, has grown to become a leading global
provider of quality, affordable healthcare products. The Company develops,
manufactures and distributes over-the-counter ("OTC") and generic prescription
("Rx") pharmaceuticals, nutritional products and active pharmaceutical
ingredients ("API") and is the world's largest manufacturer of OTC
pharmaceutical products for the store brand market. Perrigo's mission is to
offer uncompromised "quality, affordable healthcare products", and it does so
across a wide variety of product categories primarily in the United States,
United Kingdom, Mexico, Israel and Australia, as well as certain other markets
throughout the world, including Canada, China and Latin America. 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. 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. The
Company has based these forward-looking statements on its current
expectations, assumptions, estimates and projections. While the Company
believes these expectations, assumptions, estimates and projections are
reasonable, such forward-looking statements are only predictions and involve
known and unknown risks and uncertainties, many of which are beyond the
Company's control. These and other important factors, including those
discussed under "Risk Factors" in the Company's Form 10-K for the year ended
June 30, 2012, as well as the Company's subsequent filings with the Securities
and Exchange Commission, may cause actual results, performance or achievements
to differ materially from those expressed or implied by these forward-looking
statements. The forward-looking statements in this press release are made only
as of the date hereof, and 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)
                      Three Months Ended          Six Months Ended
                      December 29,  December 31,  December 29,   December 31,
                      2012          2011          2012           2011
Net sales             $         $         $            $  
                      882,959       838,170       1,652,769     1,563,465
Cost of sales         575,794       543,295       1,060,335      1,041,011
Gross profit          307,165       294,875       592,434        522,454
Operating expenses
 Distribution        11,699        9,095         22,466         19,359
 Research and        28,323        31,148        55,718         50,786
development
 Selling and         103,286       93,964        193,820        190,089
administration
 Total operating     143,308       134,207       272,004        260,234
expenses
Operating income      163,857       160,668       320,430        262,220
Interest, net         15,314        15,641        31,167         28,211
Other expense, net    76            752           14             981
Loss on sale of       3,049         —             3,049          —
investment
Income before income  145,418       144,275       286,200        233,028
taxes
Income tax expense    39,463        44,536        74,665         62,831
Net income            $         $        $          $    
                      105,955       99,739        211,535        170,197
Earnings per share
Basic earnings per    $        $        $        $      
share                  1.13        1.07       2.26          1.83
Diluted earnings per  $        $        $        $      
share                  1.12        1.06       2.24          1.81
Weighted average
shares outstanding
Basic                 93,903        93,221        93,755         93,066
Diluted               94,450        94,043        94,408         93,983
Dividends declared    $        $        $        $      
per share              0.09        0.08       0.17          0.15
See accompanying notes to condensed consolidated financial statements.



PERRIGO COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands)
(unaudited)
                        Three Months Ended          Six Months Ended
                        December29,  December31,  December29,  December31,

                        2012          2011          2012          2011
Net income              $         $        $         $    
                        105,955       99,739        211,535       170,197
 Other comprehensive
income (loss):
Change in fair value of
derivative financial    5,244         (1,496)       6,706         (9,292)
instruments, net of tax
Foreign currency        28,026        (12,851)      33,450        (65,812)
translation adjustments
Change in fair value of
investment securities,  1,037         (933)         1,037         (933)
net of tax
Post-retirement
liability adjustments,  —             (24)          (41)          (41)
net of tax
 Other comprehensive
income (loss), net of   34,307        (15,304)      41,152        (76,078)
tax
Comprehensive income    $         $        $         $     
                        140,262       84,435        252,687       94,119
See accompanying notes to condensed consolidated financial statements.



PERRIGO COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
                             December 29,     June 30,         December 31,
                             2012             2012             2011
Assets
Current assets
 Cash and cash equivalents  $         $         $       
                             459,514          602,489          531,410
 Accounts receivable, net   583,903          572,582          530,178
 Inventories                638,797          547,455          580,668
 Current deferred income    44,813           45,738           47,216
taxes
 Income taxes refundable    4,323            1,047            4,111
 Prepaid expenses and other 42,771           26,610           40,509
currentassets
Total current assets         1,774,121        1,795,921        1,734,092
Property and equipment       1,192,787        1,118,837        1,066,307
 Less accumulated           (574,362)        (540,487)        (515,600)
depreciation
                             618,425          578,350          550,707
Goodwill and other
indefinite-lived intangible  962,804          820,122          808,531
assets
Other intangible assets, net 845,666          729,253          752,595
Non-current deferred income  14,938           13,444           12,330
taxes
Other non-current assets     78,382           86,957           84,299
                             $           $           $     
                             4,294,336       4,024,047       3,942,554
Liabilities and
Shareholders' Equity
Current liabilities
 Accounts payable           $         $         $       
                             321,205          317,341          324,349
 Short-term debt            2,648            90               —
 Payroll and related taxes  71,081           89,934           71,059
 Accrued customer programs  122,651          116,055          116,888
 Accrued liabilities        65,981           76,406           85,661
 Accrued income taxes       11,299           12,905           28,684
 Current portion of         40,000           40,000           40,000
long-term debt
Total current liabilities    634,865          652,731          666,641
Non-current liabilities
 Long-term debt, less       1,329,886        1,329,235        1,452,546
current portion
 Non-current deferred       47,481           24,126           9,163
income taxes
 Other non-current          173,644          165,310          183,393
liabilities
Total non-current            1,551,011        1,518,671        1,645,102
liabilities
Shareholders' Equity
Controlling interest:
Preferred stock, without par
value, 10,000 shares         —                —                —
authorized
Common stock, without par
value, 200,000 shares        524,124          504,708          486,665
authorized
Accumulated other            80,556           39,404           50,972
comprehensive income
Retained earnings            1,502,455        1,306,925        1,090,509
                             2,107,135        1,851,037        1,628,146
Noncontrolling interest      1,325            1,608            2,665
Total shareholders' equity   2,108,460        1,852,645        1,630,811
                             $           $           $     
                             4,294,336       4,024,047       3,942,554
Supplemental Disclosures of
Balance Sheet Information
Allowance for doubtful       $         $         $       
accounts                       2,473          2,556          8,993
Working capital              $           $           $     
                             1,139,256       1,143,190       1,067,451
Preferred stock, shares      —                —                —
issued and outstanding
Common stock, shares issued  93,980           93,484           93,287
and outstanding
See accompanying notes to condensed consolidated financial statements.



PERRIGO COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
                                        Six Months Ended
                                        December 29, 2012  December 31,
                                                           2011
Cash Flows From (For) Operating
Activities
Net income                              $            $       
                                        211,535            170,197
Adjustments to derive cash flows
Gain on sale of pipeline development    —                  (3,500)
projects
Loss on sale of investment              3,049              —
Depreciation and amortization           69,939             67,105
Share-based compensation                9,363              8,977
Income tax benefit from exercise of     1,074              934
stock options
Excess tax benefit of stock             (15,668)           (11,215)
transactions
Deferred income taxes                   972                3,669
Subtotal                                280,264            236,167
Changes in operating assets and
liabilities, net of business
acquisitions
Accounts receivable                     16,228             (10,657)
Inventories                             (44,980)           (34,150)
Accounts payable                        (18,072)           (14,319)
Payroll and related taxes               (19,966)           (12,012)
Accrued customer programs               6,596              (1,412)
Accrued liabilities                     (7,156)            16,300
Accrued income taxes                    12,835             46,409
Other                                   3,854              (6,204)
Subtotal                                (50,661)           (16,045)
Net cash from operating activities      229,603            220,122
Cash Flows (For) From Investing
Activities
Acquisitions of businesses, net of      (326,944)          (547,052)
cash acquired
Proceeds from sale of intangible
assets and pipeline development         —                  10,500
projects
Additions to property and equipment     (39,279)           (55,659)
Acquisitions of assets                  —                  (750)
Net cash for investing activities       (366,223)          (592,961)
Cash Flows (For) From Financing
Activities
Borrowings (repayments) of short-term   2,558              (2,770)
debt, net
Borrowings of long-term debt            40,651             1,087,546
Repayments of long-term debt            (40,000)           (485,000)
Deferred financing fees                 (643)              (5,097)
Excess tax benefit of stock             15,668             11,215
transactions
Issuance of common stock                7,617              7,699
Repurchase of common stock              (12,159)           (7,954)
Cash dividends                          (16,005)           (14,021)
Net cash (for) from financing           (2,313)            591,618
activities
Effect of exchange rate changes on      (4,042)            2,527
cash
Net (decrease) increase in cash and     (142,975)          221,306
cash equivalents
Cash and cash equivalents, beginning    602,489            310,104
of period
Cash and cash equivalents, end of       $            $       
period                                  459,514            531,410
Supplemental Disclosures of Cash Flow
Information
Cash paid/received during the period
for:
Interest paid                           $           $        
                                        29,244             22,861
Interest received                       $          $         
                                        2,741              1,301
Income taxes paid                       $           $        
                                        67,863             15,973
Income taxes refunded                   $          $         
                                        1,155               802
See accompanying notes to condensed consolidated financial statements.



Table I
PERRIGO COMPANY
RECONCILIATION OF NON-GAAP MEASURES
(in thousands, except per share amounts)
(unaudited)
               Three Months Ended
Consolidated   December 29, 2012                          December 31, 2011                        % Change
               GAAP       Non-GAAP             As         GAAP       Non-GAAP           As         GAAP  As
                          Adjustments          Adjusted              Adjustments        Adjusted         Adjusted
Net sales      $        $               $        $        $             $        5 %   5 %
               882,959     -                882,959   838,170      -              838,170
Cost of sales  575,794    23,308      ^(a,b)   552,486    543,295    12,931      ^(a)   530,364    6 %   4 %
Gross profit   307,165    23,308               330,473    294,875    12,931             307,806    4 %   7 %
Operating
expenses
Distribution   11,699     -                    11,699     9,095      -                  9,095      29 %  29 %
Research and   28,323     -                    28,323     31,148     -                  31,148     -9 %  -9 %
development
Selling and    103,286    7,476       ^(a,c,d) 95,810     93,964     5,428       ^(a,e) 88,536     10 %  8 %
administration
Total
operating      143,308    7,476                135,832    134,207    5,428              128,779    7 %   5 %
expenses
Operating      163,857    30,784               194,641    160,668    18,359             179,027    2 %   9 %
income
Interest, net  15,314     -                    15,314     15,641     -                  15,641     -2 %  -2 %
Other expense, 76         -                    76         752        -                  752        -90   -90 %
net                                                                                                %
Loss on sale   3,049      3,049                -          -          -                  -          -     -
of investment
Income before  145,418    33,833               179,251    144,275    18,359             162,634    1 %   10 %
income taxes
Income tax     39,463     11,705      ^(j)     51,168     44,536     5,667       ^(j)   50,203     -11   2 %
expense                                                                                            %
Net income     $        $                 $        $       $               $        6 %   14 %
               105,955   22,128              128,083   99,739     12,692             112,431
Diluted        $                           $      $                         $    
earnings per    1.12                           1.36      1.06                         1.20     6 %   13 %
share
Diluted
weighted       94,450                          94,450     94,043                        94,043
average shares
outstanding
Selected
ratios as a
percentage of
net sales
Gross profit   34.8 %                          37.4 %     35.2 %                        36.7 %
Operating      16.2 %                          15.4 %     16.0 %                        15.4 %
expenses
Operating      18.6 %                          22.0 %     19.2 %                        21.4 %
income
               Six Months Ended
Consolidated   December 29, 2012                          December 31, 2011                        % Change
               GAAP       Non-GAAP             As         GAAP       Non-GAAP           As         GAAP  As
                          Adjustments          Adjusted              Adjustments        Adjusted         Adjusted
Net sales      $         $               $         $         $             $         6 %   6 %
               1,652,769    -                1,652,769  1,563,465    -              1,563,465
Cost of sales  1,060,335  36,632      ^(a,b)   1,023,703  1,041,011  55,292      ^(a,g) 985,719    2 %   4 %
Gross profit   592,434    36,632               629,066    522,454    55,292             577,746    13 %  9 %
Operating
expenses
Distribution   22,466     -                    22,466     19,359     -                  19,359     16 %  16 %
Research and   55,718     -                    55,718     50,786     (3,500)     ^(h)   54,286     10 %  3 %
development
Selling and    193,820    14,851      ^(a,c,f) 178,969    190,089    19,049      ^(a,i) 171,040    2 %   5 %
administration
Total
operating      272,004    14,851               257,153    260,234    15,549             244,685    5 %   5 %
expenses
Operating      320,430    51,483               371,913    262,220    70,841             333,061    22 %  12 %
income
Interest, net  31,167     -                    31,167     28,211     -                  28,211     10 %  10 %
Other expense, 14         -                    14         981        -                  981        -99   -99 %
net                                                                                                %
Loss on sale   3,049      3,049                -          -          -                  -          -     -
of investment
Income before  286,200    54,532               340,732    233,028    70,841             303,869    23 %  12 %
income taxes
Income tax     74,665     18,515      ^(j)     93,180     62,831     25,288      ^(j)   88,119     19 %  6 %
expense
Net income     $        $                 $        $        $               $        24 %  15 %
               211,535   36,017              247,552   170,197    45,553             215,750
Diluted        $                           $      $                         $    
earnings per    2.24                           2.62      1.81                         2.30     24 %  14 %
share
Diluted
weighted       94,408                          94,408     93,983                        93,983
average shares
outstanding
Selected
ratios as a
percentage of
net sales
Gross profit   35.8 %                          38.1 %     33.4 %                        37.0 %
Operating      16.5 %                          15.6 %     16.6 %                        15.7 %
expenses
Operating      19.4 %                          22.5 %     16.8 %                        21.3 %
income
(a) Deal-related amortization
(b) Inventory step-up of $7,693
(c) Severance costs of $1,526
(d) Acquisition costs of $40
(e) Severance costs of $599
(f) Acquisition costs of $1,917
(g) Inventory step-up of $27,179
(h) Proceeds from sale of pipeline development projects
(i) Acquisition-related and severance costs of $9,381
(j) Total tax effect for non-GAAP pre-tax adjustments



Table II
PERRIGO COMPANY
REPORTABLE SEGMENTS
RECONCILIATION OF NON-GAAP MEASURES
(in thousands)
(unaudited)
                Three Months Ended
Consumer        December 29, 2012                      December 31, 2011                    % Change
Healthcare
                GAAP      Non-GAAP           As        GAAP      Non-GAAP         As        GAAP  As
                          Adjustments        Adjusted            Adjustments      Adjusted        Adjusted
Net sales       $        $             $        $        $           $        14 %  14 %
                539,288   -                539,288  471,277    -            471,277
Cost of sales   377,034   10,914      ^(a,b) 366,120   322,464   1,006       ^(a) 321,458   17 %  14 %
Gross profit    162,254   10,914             173,168   148,813   1,006            149,819   9 %   16 %
Operating       76,176    1,649       ^(a)   74,527    66,563    1,214       ^(a) 65,349    14 %  14 %
expenses
Operating       $       $                $       $       $            $       5 %   17 %
income          86,078    12,563             98,641   82,250    2,220            84,470
Selected ratios
as a percentage
of net sales
Gross profit    30.1 %                       32.1 %    31.6 %                     31.8 %
Operating       14.1 %                       13.8 %    14.1 %                     13.9 %
expenses
Operating       16.0 %                       18.3 %    17.5 %                     17.9 %
income
                Six Months Ended
Consumer        December 29, 2012                      December 31, 2011                    % Change
Healthcare
                GAAP      Non-GAAP           As        GAAP      Non-GAAP         As        GAAP  As
                          Adjustments        Adjusted            Adjustments      Adjusted        Adjusted
Net sales       $        $             $        $        $           $        12 %  12 %
                989,704   -                989,704  882,958    -            882,958
Cost of sales   681,615   11,929      ^(a,b) 669,686   604,787   2,028       ^(a) 602,759   13 %  11 %
Gross profit    308,089   11,929             320,018   278,171   2,028            280,199   11 %  14 %
Operating       142,723   2,897       ^(a)   139,826   126,732   2,437       ^(a) 124,295   13 %  12 %
expenses
Operating       $        $                $        $        $            $        9 %   16 %
income          165,366  14,826             180,192  151,439  4,465            155,904
Selected ratios
as a percentage
of net sales
Gross profit    31.1 %                       32.3 %    31.5 %                     31.7 %
Operating       14.4 %                       14.1 %    14.4 %                     14.1 %
expenses
Operating       16.7 %                       18.2 %    17.2 %                     17.7 %
income
                Three Months Ended
Nutritionals    December 29, 2012                      December 31, 2011                    % Change
                GAAP      Non-GAAP           As        GAAP      Non-GAAP         As        GAAP  As
                          Adjustments        Adjusted            Adjustments      Adjusted        Adjusted
Net sales       $        $             $        $        $           $        -5 %  -5 %
                121,938   -                121,938  128,147    -            128,147
Cost of sales   91,793    3,049       ^(a)   88,744    99,917    3,022       ^(a) 96,895    -8 %  -8 %
Gross profit    30,145    3,049              33,194    28,230    3,022            31,252    7 %   6 %
Operating       22,985    4,261       ^(a)   18,724    23,678    3,615       ^(a) 20,063    -3 %  -7 %
expenses
Operating       $      $               $       $      $            $       57 %  29 %
income          7,160     7,310              14,470   4,552     6,637            11,189
Selected ratios
as a percentage
of net sales
Gross profit    24.7 %                       27.2 %    22.0 %                     24.4 %
Operating       18.8 %                       15.4 %    18.5 %                     15.7 %
expenses
Operating       5.9 %                        11.9 %    3.6 %                      8.7 %
income
                Six Months Ended
Nutritionals    December 29, 2012                      December 31, 2011                    % Change
                GAAP      Non-GAAP           As        GAAP      Non-GAAP         As        GAAP  As
                          Adjustments        Adjusted            Adjustments      Adjusted        Adjusted
Net sales       $        $             $        $        $           $        -9 %  -9 %
                225,361   -                225,361  248,008    -            248,008
Cost of sales   169,381   6,099       ^(a)   163,282   190,209   8,871       ^(a) 181,338   -11   -10 %
                                                                                            %
Gross profit    55,980    6,099              62,079    57,799    8,871            66,670    -3 %  -7 %
Operating       44,937    8,511       ^(a)   36,426    46,006    7,231       ^(a) 38,775    -2 %  -6 %
expenses
Operating       $       $                $       $       $             $       -6 %  -8 %
income          11,043    14,610             25,653   11,793    16,102           27,895
Selected ratios
as a percentage
of net sales
Gross profit    24.8 %                       27.5 %    23.3 %                     26.9 %
Operating       19.9 %                       16.2 %    18.6 %                     15.6 %
expenses
Operating       4.9 %                        11.4 %    4.8 %                      11.2 %
income
                Three Months Ended
Rx              December 29, 2012                      December 31, 2011                    % Change
Pharmaceuticals
                GAAP      Non-GAAP           As        GAAP      Non-GAAP         As        GAAP  As
                          Adjustments        Adjusted            Adjustments      Adjusted        Adjusted
Net sales       $        $             $        $        $           $        -8 %  -8 %
                162,541   -                162,541  177,196    -            177,196
Cost of sales   76,505    8,457       ^(a)   68,048    85,818    7,969       ^(a) 77,849    -11   -13 %
                                                                                            %
Gross profit    86,036    8,457              94,493    91,378    7,969            99,347    -6 %  -5 %
Operating       21,977    1,526       ^(c)   20,451    21,404    599         ^(c) 20,805    3 %   -2 %
expenses
Operating       $       $               $       $       $            $       -8 %  -6 %
income          64,059    9,983              74,042   69,974    8,568            78,542
Selected ratios
as a percentage
of net sales
Gross profit    52.9 %                       58.1 %    51.6 %                     56.1 %
Operating       13.5 %                       12.6 %    12.1 %                     11.7 %
expenses
Operating       39.4 %                       45.6 %    39.5 %                     44.3 %
income
(a) Deal-related amortization
(b) Inventory step-up of $7,693
(c) Severance costs
(d) Inventory step-up of $27,179
(e) Proceeds of $3,500 from sale of pipeline development projects
(f) Severance costs of $3,755



Table II (Continued)
PERRIGO COMPANY
REPORTABLE SEGMENTS
RECONCILIATION OF NON-GAAP MEASURES
(in thousands)
(unaudited)
                Six Months Ended
Rx              December 29, 2012                    December 31, 2011                      % Change
Pharmaceuticals
                GAAP      Non-GAAP         As        GAAP      Non-GAAP           As        GAAP  As
                          Adjustments      Adjusted            Adjustments        Adjusted        Adjusted
Net sales       $        $           $       $        $             $       7 %   7 %
                325,483  -               325,483   304,823  -                 304,823
Cost of sales   152,763   16,859      ^(a) 135,904   171,985   42,501      ^(a,d) 129,484   -11   5 %
                                                                                            %
Gross profit    172,720   16,859           189,579   132,838   42,501             175,339   30 %  8 %
Operating       40,157    1,526       ^(c) 38,631    38,379    255         ^(e,f) 38,124    5 %   1 %
expenses
Operating       $        $              $       $       $  42,756        $       40 %  10 %
income          132,563  18,385           150,948   94,459                      137,215
Selected ratios
as a percentage
of net sales
Gross profit    53.1 %                     58.2 %    43.6 %                       57.5 %
Operating       12.3 %                     11.9 %    12.6 %                       12.5 %
expenses
Operating       40.7 %                     46.4 %    31.0 %                       45.0 %
income
                Three Months Ended
API             December 29, 2012                    December 31, 2011                      % Change
                GAAP      Non-GAAP         As        GAAP      Non-GAAP           As        GAAP  As
                          Adjustments      Adjusted            Adjustments        Adjusted        Adjusted
Net sales       $       $           $       $       $             $       -4 %  -4 %
                40,854   -               40,854   42,752   -                 42,752
Cost of sales   17,971    481         ^(a) 17,490    22,601    496         ^(a)   22,105    -20   -21 %
                                                                                            %
Gross profit    22,883    481              23,364    20,151    496                20,647    14 %  13 %
Operating       9,063     -                9,063     8,458     -                  8,458     7 %   7 %
expenses
Operating       $       $            $       $       $              $       18 %  17 %
income          13,820   481              14,301   11,693   496                12,189
Selected ratios
as a percentage
of net sales
Gross profit    56.0 %                     57.2 %    47.1 %                       48.3 %
Operating       22.2 %                     22.2 %    19.8 %                       19.8 %
expenses
Operating       33.8 %                     35.0 %    27.4 %                       28.5 %
income
                Six Months Ended
API             December 29, 2012                    December 31, 2011                      % Change
                GAAP      Non-GAAP         As        GAAP      Non-GAAP           As        GAAP  As
                          Adjustments      Adjusted            Adjustments        Adjusted        Adjusted
Net sales       $       $           $       $       $             $       -15   -15 %
                77,273   -               77,273   90,396   -                 90,396   %
Cost of sales   33,030    944         ^(a) 32,086    48,637    1,017       ^(a)   47,620    -32   -33 %
                                                                                            %
Gross profit    44,243    944              45,187    41,759    1,017              42,776    6 %   6 %
Operating       17,104    -                17,104    15,851    -                  15,851    8 %   8 %
expenses
Operating       $       $            $       $       $                $       5 %   4 %
income          27,139   944              28,083   25,908   1,017             26,925
Selected ratios
as a percentage
of net sales
Gross profit    57.3 %                     58.5 %    46.2 %                       47.3 %
Operating       22.1 %                     22.1 %    17.5 %                       17.5 %
expenses
Operating       35.1 %                     36.3 %    28.7 %                       29.8 %
income
                Three Months Ended
Other           December 29, 2012                    December 31, 2011                      % Change
                GAAP      Non-GAAP         As        GAAP      Non-GAAP           As        GAAP  As
                          Adjustments      Adjusted            Adjustments        Adjusted        Adjusted
Net sales       $       $           $       $       $             $       -2 %  -2 %
                18,338   -               18,338   18,798   -                 18,798
Cost of sales   12,491    407         ^(a) 12,084    12,495    438         ^(a)   12,057    -0 %  0 %
Gross profit    5,847     407              6,254     6,303     438                6,741     -7 %  -7 %
Operating       5,184     -                5,184     5,379     -                  5,379     -4 %  -4 %
expenses
Operating       $      $            $      $      $              $      -28   -21 %
income           663    407              1,070     924    438                1,362    %
Selected ratios
as a percentage
of net sales
Gross profit    31.9 %                     34.1 %    33.5 %                       35.9 %
Operating       28.3 %                     28.3 %    28.6 %                       28.6 %
expenses
Operating       3.6 %                      5.8 %     4.9 %                        7.2 %
income
                Six Months Ended
Other           December 29, 2012                    December 31, 2011                      % Change
                GAAP      Non-GAAP         As        GAAP      Non-GAAP           As        GAAP  As
                          Adjustments      Adjusted            Adjustments        Adjusted        Adjusted
Net sales       $       $           $       $       $             $       -6 %  -6 %
                34,948   -               34,948   37,280   -                 37,280
Cost of sales   23,546    800         ^(a) 22,746    25,393    875         ^(a)   24,518    -7 %  -7 %
Gross profit    11,402    800              12,202    11,887    875                12,762    -4 %  -4 %
Operating       10,314    -                10,314    10,678    -                  10,678    -3 %  -3 %
expenses
Operating       $      $            $      $      $              $      -10   -9 %
income          1,088    800              1,888    1,209     875                2,084    %
Selected ratios
as a percentage
of net sales
Gross profit    32.6 %                     34.9 %    31.9 %                       34.2 %
Operating       29.5 %                     29.5 %    28.6 %                       28.6 %
expenses
Operating       3.1 %                      5.4 %     3.2 %                        5.6 %
income
(a) Deal-related amortization
(b) Inventory step-up of $7,693
(c) Severance costs
(d) Inventory step-up of $27,179
(e) Proceeds of $3,500 from sale of pipeline development projects
(f) Severance costs of $3,755



Table III
PERRIGO COMPANY
FY 2013 GUIDANCE AND FY 2012 EPS
RECONCILIATION OF NON-GAAP MEASURES
(unaudited)
                                                         Full Year
                                                         Fiscal 2013 Guidance
 FY13 reported diluted EPS range ^(2)                    $4.73 - $4.93
  Deal-related amortization ^(1,2)                    0.63
  Charge associated with inventory step-up ^(2)       0.05
  Charges associated with acquisition and severance   0.02
 costs^(2)
  Loss on sale of investment                          0.02
 FY13 adjusted diluted EPS range                         $5.45 - $5.65
                                                         Fiscal 2012*
 FY12 reported diluted EPS from continuing operations    $4.18
  Deal-related amortization ^(1)                      0.523
  Charge associated with inventory step-up            0.181
  Charges associated with acquisition-related and     0.062
 severance costs
  Charges associated with restructuring               0.061
  Net charge associated with acquired R&D and         0.012
 proceeds from sale of IPR&D projects
  Earnings associated with sale of pipeline           (0.026)
 development projects
 FY12 adjusted diluted EPS from continuing operations    $4.99
 (1) Amortization of acquired intangible assets related
 to business combinations and asset acquisitions
 (2) Does not include any estimate related to the
 Velcera acquisition
 *All information based on continuing operations.





SOURCE Perrigo Company

Website: http://www.perrigo.com
Contact: Arthur J. Shannon, Vice President, Investor Relations and
Communication, +1-269-686-1709, ajshannon@perrigo.com or Bradley Joseph,
Senior Manager, Investor Relations and Communication, +1-269-686-3373,
bradley.joseph@perrigo.com
 
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