Perrigo To Cut 800 Jobs; Urges Shareholders To Reject Mylan Offer

(RTTNews) - Perrigo Company plc (PRGO) said Thursday it plans to reduce its workforce by 800 employees, or about 6 percent of its current global headcount, and expects to add incremental benefits of $175 million, as part of its actions to drive substantial profit growth in 2016 and beyond. Perrigo further said it is positioned to create substantially more value than the Mylan (MYL) offer and urged shareholders not to tender shares to the offer. In addition, Perrigo announced a $2 billion share repurchase plan.

The company sais it is taking immediate steps to consolidate its operations, supply chain and procurement management activities into one global center of excellence in Ireland and expects annualized operational and tax benefits of $105 million from these initiatives. Perrigo said it is streamlining its organizational structure and eliminating redundant administrative functions. Perrigo said it also taking actions to refine its portfolio, including commencing a sales process for the U.S. Vitamins, Minerals and Supplements business.

Perrigo also reported GAAP net income of $113 million or $0.77 per share with GAAP gross margin of 41% and GAAP operating margin of 14% for the third calendar quarter ended September 26, 2015. Adjusted net income increased 38% to $258 million, with adjusted diluted earnings per share of $1.76. Net sales were $1.34 billion, an increase of 41% on a reported basis. Perrigo also narrowed full year 2015 adjusted EPS guidance range to $7.65 - 7.85, excluding the benefits from Share Repurchase Plan.