Research Update: Perrigo Co. PLC Ratings Affirmed; Outlook Stable

S&P Global Ratings expects Perrigo Co. PLC's de-leveraging plans to take hold in 2023 following supply chain, inflation, and currency headwinds in 2022. We also view management's commitment to reduce company-defined leverage from 5.5x presently to about 3x by 2025 as a key rating factor. We assume S&P Global Ratings-adjusted EBITDA should increase by 15%-20% in 2023 as these headwinds lessen and the company benefits from the integration of HRA and Gateway. We also believe the defensive nature of the industry should limit category declines in a potential downturn. S&P Global Ratings-adjusted leverage is forecast to improve to slightly below 5x in 2023, notwithstanding the Dublin-based consumer self-care company's costly but strategically designed multiyear Supply Chain Reinvention Program. We affirmed

...- S&P Global Ratings expects Perrigo Co. PLC's de-leveraging plans to take hold in 2023 following supply chain, inflation, and currency headwinds in 2022. We also view management's commitment to reduce company-defined leverage from 5.5x presently to about 3x by 2025 as a key rating factor. - We assume S&P Global Ratings-adjusted EBITDA should increase by 15%-20% in 2023 as these headwinds lessen and the company benefits from the integration of HRA and Gateway. We also believe the defensive nature of the industry should limit category declines in a potential downturn. S&P Global Ratings-adjusted leverage is forecast to improve to slightly below 5x in 2023, notwithstanding the Dublin-based consumer self-care company's costly but strategically designed multiyear Supply Chain Reinvention Program. - We affirmed our '##' issuer credit on the company and affirmed our '##+' rating on the senior secured debt and '##-' rating on the senior unsecured debt. The recovery rating on the senior secured...

Research Update