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Perrigo Profit Tops View, Cuts FY18 Forecast; Plans To Separate Rx Unit

Perrigo Co. plc (PRGO), a healthcare supplier, reported Thursday that its second-quarter net income was $36 million, compared to a net loss of $70 million last year. Earnings per share were $0.26, compared to losses per share of $0.49 last year.

Adjusted net income was $169 million, compared to $175 million a year ago, and adjusted earnings per share were $1.22, same as last year.

Net sales for the quarter fell 4.2 percent to $1.19 billion from $1.24 billion a year earlier. At constant rates, sales dropped 5.7 percent.

On average, analysts polled by Thomson Reuters expected earnings of $1.19 per share on net sales of $1.23 billion for the quarter. Analysts' estimates typically exclude special items.

Looking ahead, the Company now expects calendar year 2018 reported earnings per share to be in the range of $2.11 to $2.31, adjusted earnings per share in the range of $4.75 to $4.95, and net sales in the range of $4.8 billion to $4.9 billion. The revision in outlook is primarily due to revised net sales expectations for the RX segment.

The company previously expected reported earnings per share to be in the range of $2.90 to $3.30, adjusted earnings per share in the range of $5.05 to $5.45, and net sales in the range of $5.0 billion to $5.1 billion.

Analysts expect earnings of $5.2 per share on sales of $5.01 billion for the year.

Separately, Perrigo announced that its Board of Directors approved a plan to separate the Company's Prescription Pharmaceuticals or Rx business following the Company's previously announced strategic portfolio review. The Board will consider all value-enhancing options, including a possible tax-efficient separation to shareholders, a sale or merger.

Further, Perrigo announced that it has entered into a licensing agreement with a subsidiary of Merck & Co, Inc., Kenilworth, NJ, USA for the exclusive rights in the United States to pursue regulatory approval for a non-prescription, over-the-counter Nasonex (mometasone furoate monohydrate) Nasal Spray.

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