DUBLIN, Ohio, April 28, 2016 /PRNewswire/ -- Cardinal
Health today reported third-quarter results for fiscal year 2016,
including a 21 percent increase in revenue to $30.7 billion and a 20 percent increase in
non-GAAP operating earnings to $788
million. Non-GAAP diluted earnings per share (EPS) increased
20 percent to $1.43. On a GAAP basis,
operating earnings increased 11 percent to $656 million, and diluted EPS increased 7 percent
to $1.17.
"We had a strong financial and operational performance in our
fiscal third quarter. At the same time, we continued to enhance and
grow enterprise-wide service and product lines, which are important
to our customers and address some of health care's most difficult
challenges," said George Barrett,
chairman and chief executive officer of Cardinal Health. "We
delivered double-digit growth in revenue and profit in both our
Pharmaceutical and Medical reporting segments and had very solid
performance across our lines of business."
The company tightened the range for its fiscal 2016 non-GAAP
diluted earnings per share guidance to $5.17
to $5.27 from the prior range of $5.15 to $5.35.
Q3 FY16 SUMMARY
|
Q3
FY16
|
Q3
FY15
|
Y/Y
|
Revenue
|
$30.7
billion
|
$25.4
billion
|
21%
|
|
|
|
|
Operating
Earnings
|
$656
million
|
$ 591
million
|
11%
|
Non-GAAP Operating
Earnings
|
$788
million
|
$657
million
|
20%
|
|
|
|
|
Net Earnings
attributable to
Cardinal Health, Inc.
|
$386
million
|
$365
million
|
6%
|
Non-GAAP Net
Earnings
attributable to Cardinal
Health, Inc.
|
$472
million
|
$396
million
|
19%
|
|
|
|
|
Diluted EPS
attributable to
Cardinal Health, Inc.
|
$1.17
|
$1.09
|
7%
|
Non-GAAP Diluted
EPS
attributable to Cardinal Health,
Inc.
|
$1.43
|
$1.19
|
20%
|
SEGMENT RESULTS
Pharmaceutical segment
Third-quarter revenue for the Pharmaceutical segment increased
22 percent to $27.5 billion due to
growth from new and existing customers as well as acquisitions.
Strong performance from both acquisitions and new and existing
customers significantly contributed to segment profit growth of 16
percent to $660 million.
|
Q3
FY16
|
Q3
FY15
|
Y/Y
|
Revenue
|
$27.5
billion
|
$22.6
billion
|
22%
|
Segment
Profit
|
$660
million
|
$567
million
|
16%
|
Medical segment
Third-quarter revenue for the Medical segment increased 13
percent to $3.1 billion due to the
net contribution from acquisitions as well as solid growth from
existing businesses.
Segment profit increased 26 percent to $128 million due to the contribution from
acquisitions, net of divestitures, and from Cardinal Health-branded
products. Segment profit includes the $21
million negative impact of the Cordis-related inventory fair
value step-up.
|
Q3
FY16
|
Q3
FY15
|
Y/Y
|
Revenue
|
$3.1
billion
|
$2.8
billion
|
13%
|
Segment
Profit
|
$128
million
|
$102
million
|
26%
|
ADDITIONAL THIRD-QUARTER AND RECENT HIGHLIGHTS
- Announced agreement to acquire Curaspan Health Group Inc., a
leader in discharge planning and care transitions technology for
hospitals, health systems and post-acute providers
- Recognized as one of the Top Companies for Female Executives by
the National Association for Female Executives
- Launched Cardinal Health MedSync Advantageâ„¢, a custom-built
medication synchronization program to help community pharmacists
improve medication adherence and patient outcomes and increase
pharmacy efficiency
- Announced winners of the sixth annual Generation Rx awards,
recognizing student pharmacists from across the country and a
clinical professor of pharmacy for their ongoing efforts to help
prevent prescription medication misuse
CONFERENCE CALL
Cardinal Health will host a webcast and conference call today at
8:30 a.m. Eastern to discuss
third-quarter results. To access the call and corresponding slide
presentation, go to ir.cardinalhealth.com. Alternatively,
participants can call 913.312.1411 and use passcode 4332927.
There is no pre-registration for the call. Participants are
advised to dial into the call at least 10 minutes prior to the
start time.
Presentation slides and a webcast replay will be available on
the Cardinal Health website at ir.cardinalhealth.com.
UPCOMING WEBCASTED INVESTOR EVENTS
- William Blair's 36th
Annual Growth Stock Conference on June
15 at 8 a.m. Central in
Chicago
At the event, Cardinal Health executives will discuss the
company's diverse products and services, company performance and
strategies for continued growth. To access more details and a live
webcast of this event, go to ir.cardinalhealth.com.
About Cardinal Health
Cardinal Health, Inc. (NYSE: CAH), a global health services and
products company, brings scaled solutions that help our customers
thrive in a changing world. We improve the cost-effectiveness of
healthcare through solutions that improve the efficiency of the
supply chain; optimize the process and performance of healthcare;
provide clinically proven, daily use medical products and
pharmaceuticals; and connect patients, providers, payers,
pharmacists and manufacturers for seamless care coordination and
better patient management. Backed by nearly 100 years of
experience, we rank among the top 50 on the Fortune 500 and
among the Fortune Global 100. We support our partners
with more than 37,000 employees in nearly 60 countries worldwide.
For more information, visit cardinalhealth.com and @CardinalHealth
on Twitter.
Cardinal Health uses its website as a channel of distribution
for material company information. Important information, including
news releases, financial information, earnings and analyst
presentations, and information about upcoming presentations and
events is routinely posted and accessible at ir.cardinalhealth.com.
In addition, the website allows investors and other interested
persons to sign up automatically to receive e-mail alerts when the
company posts news releases, SEC filings and certain other
information on its website.
1
|
See the attached
tables for definitions of the non-GAAP financial measures presented
in this news release and reconciliations of the differences between
the non-GAAP financial measures and their most directly comparable
GAAP financial measures.
|
Cautions Concerning Forward-Looking Statements
This news release contains forward-looking statements addressing
expectations, prospects, estimates and other matters that are
dependent upon future events or developments. These statements may
be identified by words such as "expect," "anticipate," "intend,"
"plan," "believe," "will," "should," "could," "would," "project,"
"continue," "likely," and similar expressions, and include
statements reflecting future results or guidance, statements of
outlook and expense accruals. These matters are subject to risks
and uncertainties that could cause actual results to differ
materially from those projected, anticipated or implied. These
risks and uncertainties include competitive pressures in Cardinal
Health's various lines of business; the frequency or rate of
pharmaceutical price appreciation or deflation and the timing of
generic and branded pharmaceutical introductions; the ability to
continue to achieve and maintain the benefits from the generic
sourcing venture with CVS Health and from the acquisitions of
Cordis and The Harvard Drug Group; the risk of non-renewal or a
default under one or more key customer or supplier arrangements or
changes to the terms of or level of purchases under those
arrangements; uncertainties due to government health care reform,
including federal health care reform legislation; changes in the
distribution patterns or reimbursement rates for health care
products and services; the effects of any investigation or action
by any regulatory authority; and changes in foreign currency rates
and the cost of commodities such as oil-based resins, cotton, latex
and diesel fuel. Cardinal Health is subject to additional risks and
uncertainties described in Cardinal Health's Form 10-K, Form 10-Q
and Form 8-K reports and exhibits to those reports. This news
release reflects management's views as of April 28, 2016. Except to the extent required by
applicable law, Cardinal Health undertakes no obligation to update
or revise any forward-looking statement.
Schedule
1
|
|
Cardinal Health,
Inc. and Subsidiaries
|
Condensed
Consolidated Statements of Earnings (Unaudited)
|
|
|
Third
Quarter
|
|
|
(in millions, except
per common share amounts)
|
2016
|
|
2015
|
|
%
Change
|
Revenue
|
$
|
30,662
|
|
|
$
|
25,375
|
|
|
21
|
%
|
Cost of products
sold
|
28,973
|
|
|
23,916
|
|
|
21
|
%
|
Gross
margin
|
1,689
|
|
|
1,459
|
|
|
16
|
%
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
Distribution,
selling, general, and administrative expenses
|
914
|
|
|
803
|
|
|
14
|
%
|
Restructuring and
employee severance
|
6
|
|
|
7
|
|
|
N.M.
|
|
Amortization and
other acquisition-related costs
|
108
|
|
|
77
|
|
|
N.M.
|
|
Impairments and
(gain)/loss on disposal of assets
|
—
|
|
|
(1)
|
|
|
N.M.
|
|
Litigation
(recoveries)/charges, net
|
5
|
|
|
(18)
|
|
|
N.M.
|
|
Operating
earnings
|
656
|
|
|
591
|
|
|
11
|
%
|
|
|
|
|
|
|
Other
(income)/expense, net
|
—
|
|
|
(2)
|
|
|
N.M.
|
|
Interest expense,
net
|
44
|
|
|
35
|
|
|
28
|
%
|
Earnings before
income taxes
|
612
|
|
|
558
|
|
|
10
|
%
|
|
|
|
|
|
|
Provision for income
taxes
|
226
|
|
|
193
|
|
|
17
|
%
|
Net
earnings
|
386
|
|
|
365
|
|
|
6
|
%
|
|
|
|
|
|
|
Less: Net earnings
attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
N.M.
|
|
Net earnings
attributable to Cardinal Health, Inc.
|
$
|
386
|
|
|
$
|
365
|
|
|
6
|
%
|
|
|
|
|
|
|
Earnings per
common share attributable to Cardinal Health, Inc.:
|
|
|
|
|
|
Basic
|
$
|
1.18
|
|
|
$
|
1.10
|
|
|
7
|
%
|
Diluted
|
1.17
|
|
|
1.09
|
|
|
7
|
%
|
|
|
|
|
|
|
Weighted-average
number of common shares outstanding:
|
|
|
|
|
|
Basic
|
328
|
|
|
330
|
|
|
|
Diluted
|
331
|
|
|
334
|
|
|
|
Schedule
2
|
|
Cardinal Health,
Inc. and Subsidiaries
|
Condensed
Consolidated Statements of Earnings (Unaudited)
|
|
|
Year-to-Date
|
|
|
(in millions, except
per common share amounts)
|
2016
|
|
2015
|
|
%
Change
|
Revenue
|
$
|
90,162
|
|
|
$
|
74,983
|
|
|
20
|
%
|
Cost of products
sold
|
85,285
|
|
|
70,729
|
|
|
21
|
%
|
Gross
margin
|
4,877
|
|
|
4,254
|
|
|
15
|
%
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
Distribution,
selling, general, and administrative expenses
|
2,678
|
|
|
2,393
|
|
|
12
|
%
|
Restructuring and
employee severance
|
19
|
|
|
33
|
|
|
N.M.
|
|
Amortization and
other acquisition-related costs
|
327
|
|
|
190
|
|
|
N.M.
|
|
Impairments and
(gain)/loss on disposal of assets
|
17
|
|
|
(19)
|
|
|
N.M.
|
|
Litigation
(recoveries)/charges, net
|
(3)
|
|
|
54
|
|
|
N.M.
|
|
Operating
earnings
|
1,839
|
|
|
1,603
|
|
|
15
|
%
|
|
|
|
|
|
|
Other
(income)/expense, net
|
5
|
|
|
(6)
|
|
|
N.M.
|
|
Interest expense,
net
|
134
|
|
|
105
|
|
|
28
|
%
|
Loss on
extinguishment of debt
|
—
|
|
|
60
|
|
|
N.M.
|
|
Earnings before
income taxes
|
1,700
|
|
|
1,444
|
|
|
18
|
%
|
|
|
|
|
|
|
Provision for income
taxes
|
604
|
|
|
524
|
|
|
15
|
%
|
Net
earnings
|
1,096
|
|
|
920
|
|
|
19
|
%
|
|
|
|
|
|
|
Less: Net earnings
attributable to noncontrolling interests
|
(1)
|
|
|
—
|
|
|
N.M.
|
|
Net earnings
attributable to Cardinal Health, Inc.
|
$
|
1,095
|
|
|
$
|
920
|
|
|
19
|
%
|
|
|
|
|
|
|
Earnings per
common share attributable to Cardinal Health, Inc.:
|
|
|
|
|
|
Basic
|
$
|
3.33
|
|
|
$
|
2.77
|
|
|
20
|
%
|
Diluted
|
3.30
|
|
|
2.74
|
|
|
20
|
%
|
|
|
|
|
|
|
Weighted-average
number of common shares outstanding:
|
|
|
|
|
|
Basic
|
328
|
|
|
332
|
|
|
|
Diluted
|
331
|
|
|
336
|
|
|
|
Schedule
3
|
|
Cardinal Health,
Inc. and Subsidiaries
|
Condensed
Consolidated Balance Sheets (Unaudited)
|
|
(in
millions)
|
March 31,
2016
|
|
June 30,
2015
|
|
|
|
|
Assets
|
|
|
|
Current
assets:
|
|
|
|
Cash and
equivalents
|
$
|
2,598
|
|
|
$
|
4,616
|
|
Trade receivables,
net
|
7,292
|
|
|
6,523
|
|
Inventories,
net
|
10,910
|
|
|
9,211
|
|
Prepaid expenses and
other
|
1,491
|
|
|
1,402
|
|
Total current
assets
|
22,291
|
|
|
21,752
|
|
|
|
|
|
Property and
equipment, net
|
1,683
|
|
|
1,506
|
|
Goodwill and other
intangibles, net
|
9,150
|
|
|
6,018
|
|
Other
assets
|
931
|
|
|
866
|
|
Total
assets
|
$
|
34,055
|
|
|
$
|
30,142
|
|
|
|
|
|
Liabilities,
Redeemable Noncontrolling Interests, and Shareholders'
Equity
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
|
17,340
|
|
|
$
|
14,368
|
|
Current portion of
long-term obligations and other short-term borrowings
|
351
|
|
|
281
|
|
Other accrued
liabilities
|
1,694
|
|
|
2,594
|
|
Total current
liabilities
|
19,385
|
|
|
17,243
|
|
|
|
|
|
Long-term
obligations, less current portion
|
5,195
|
|
|
5,211
|
|
Deferred income taxes
and other liabilities
|
2,628
|
|
|
1,432
|
|
|
|
|
|
Redeemable
noncontrolling interests
|
117
|
|
|
—
|
|
|
|
|
|
Total Cardinal
Health, Inc. shareholders' equity
|
6,713
|
|
|
6,256
|
|
Noncontrolling
interests
|
17
|
|
|
—
|
|
Total shareholders'
equity
|
6,730
|
|
|
6,256
|
|
Total liabilities,
redeemable noncontrolling interests, and shareholders'
equity
|
$
|
34,055
|
|
|
$
|
30,142
|
|
Schedule
4
|
|
Cardinal Health,
Inc. and Subsidiaries
|
Condensed
Consolidated Statements of Cash Flows (Unaudited)
|
|
|
Third
Quarter
|
|
Year-to-Date
|
(in
millions)
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
Net
earnings
|
$
|
386
|
|
|
$
|
365
|
|
|
$
|
1,096
|
|
|
$
|
920
|
|
|
|
|
|
|
|
|
|
Adjustments to
reconcile net earnings to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
159
|
|
|
116
|
|
|
465
|
|
|
336
|
|
Loss on
extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
60
|
|
Gain on sale of other
investments
|
—
|
|
|
—
|
|
|
—
|
|
|
(5)
|
|
Impairments and
(gain)/loss on disposal of assets, net
|
—
|
|
|
(1)
|
|
|
17
|
|
|
(19)
|
|
Share-based
compensation
|
26
|
|
|
27
|
|
|
82
|
|
|
80
|
|
Provision for bad
debts
|
16
|
|
|
16
|
|
|
51
|
|
|
42
|
|
Change in fair value
of contingent consideration obligation
|
(2)
|
|
|
—
|
|
|
(16)
|
|
|
—
|
|
Change in operating
assets and liabilities, net of effects from
acquisitions:
|
|
|
|
|
|
|
|
Increase in trade
receivables
|
(328)
|
|
|
(427)
|
|
|
(721)
|
|
|
(718)
|
|
Decrease/(increase) in
inventories
|
108
|
|
|
287
|
|
|
(1,457)
|
|
|
(850)
|
|
Increase in accounts
payable
|
408
|
|
|
219
|
|
|
2,839
|
|
|
1,657
|
|
Other accrued
liabilities and operating items, net
|
146
|
|
|
56
|
|
|
(26)
|
|
|
169
|
|
Net cash provided by
operating activities
|
919
|
|
|
658
|
|
|
2,330
|
|
|
1,672
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
Acquisition of
subsidiaries, net of cash acquired
|
(99)
|
|
|
(233)
|
|
|
(3,383)
|
|
|
(319)
|
|
Additions to property
and equipment
|
(109)
|
|
|
(56)
|
|
|
(284)
|
|
|
(139)
|
|
Purchase of
available-for-sale securities and other investments
|
(62)
|
|
|
(27)
|
|
|
(150)
|
|
|
(134)
|
|
Proceeds from sale of
available-for-sale securities and other investments
|
42
|
|
|
22
|
|
|
99
|
|
|
129
|
|
Proceeds from
maturities of available-for-sale securities
|
18
|
|
|
8
|
|
|
37
|
|
|
24
|
|
Proceeds from
divestitures and disposal of held for sale assets
|
—
|
|
|
—
|
|
|
—
|
|
|
53
|
|
Net cash used in
investing activities
|
(210)
|
|
|
(286)
|
|
|
(3,681)
|
|
|
(386)
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
Payment of contingent
consideration obligation
|
—
|
|
|
(3)
|
|
|
(23)
|
|
|
(3)
|
|
Net change in
short-term borrowings
|
(5)
|
|
|
9
|
|
|
34
|
|
|
(9)
|
|
Purchase of
noncontrolling interests
|
(10)
|
|
|
—
|
|
|
(10)
|
|
|
—
|
|
Reduction of
long-term obligations
|
(1)
|
|
|
(1)
|
|
|
(5)
|
|
|
(1,221)
|
|
Proceeds from
long-term obligations, net of issuance costs
|
—
|
|
|
—
|
|
|
—
|
|
|
1,182
|
|
Net proceeds/(tax
withholdings) from share-based compensation
|
4
|
|
|
24
|
|
|
(3)
|
|
|
59
|
|
Excess tax benefits
from share-based compensation
|
1
|
|
|
14
|
|
|
33
|
|
|
56
|
|
Dividends on common
shares
|
(127)
|
|
|
(113)
|
|
|
(386)
|
|
|
(346)
|
|
Purchase of treasury
shares
|
(300)
|
|
|
—
|
|
|
(300)
|
|
|
(686)
|
|
Net cash used in
financing activities
|
(438)
|
|
|
(70)
|
|
|
(660)
|
|
|
(968)
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash and equivalents
|
3
|
|
|
—
|
|
|
(7)
|
|
|
—
|
|
|
|
|
|
|
|
|
|
Net
increase/(decrease) in cash and equivalents
|
274
|
|
|
302
|
|
|
(2,018)
|
|
|
318
|
|
Cash and equivalents
at beginning of period
|
2,324
|
|
|
2,881
|
|
|
4,616
|
|
|
2,865
|
|
Cash and
equivalents at end of period
|
$
|
2,598
|
|
|
$
|
3,183
|
|
|
$
|
2,598
|
|
|
$
|
3,183
|
|
Schedule
5
|
|
Cardinal Health,
Inc. and Subsidiaries
|
Total Company
Business Analysis
|
|
|
|
|
Non-GAAP
|
|
Third
Quarter
|
|
Third
Quarter
|
(in
millions)
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Revenue
|
|
|
|
|
|
|
|
Amount
|
$
|
30,662
|
|
|
$
|
25,375
|
|
|
|
|
|
Growth
rate
|
21%
|
|
|
18%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
Margin
|
|
|
|
|
|
|
|
Amount1
|
$
|
1,689
|
|
|
$
|
1,459
|
|
|
$
|
1,702
|
|
|
$
|
1,459
|
|
Growth
rate
|
16%
|
|
|
12%
|
|
|
17%
|
|
|
12%
|
|
|
|
|
|
|
|
|
|
Operating
earnings
|
|
|
|
|
|
|
|
Amount
|
$
|
656
|
|
|
$
|
591
|
|
|
$
|
788
|
|
|
$
|
657
|
|
Growth
rate
|
11%
|
|
|
16%
|
|
|
20%
|
|
|
17%
|
|
|
|
|
|
|
|
|
|
Net earnings
attributable to Cardinal Health, Inc.
|
|
|
|
|
|
|
|
Amount
|
$
|
386
|
|
|
$
|
365
|
|
|
$
|
472
|
|
|
$
|
396
|
|
Growth
rate
|
6%
|
|
|
16%
|
|
|
19%
|
|
|
13%
|
|
|
|
|
|
|
|
|
|
Return on
equity
|
23%
|
|
|
23.4%
|
|
|
28.1%
|
|
|
25.4%
|
|
|
|
|
|
|
|
|
|
Effective tax
rate
|
36.9%
|
|
|
34.6%
|
|
|
36.6%
|
|
|
36.5%
|
|
|
|
|
|
|
|
|
|
Debt to total
capital
|
45%
|
|
|
39%
|
|
|
|
|
|
Net debt to
capital
|
|
|
|
|
31%
|
|
|
11%
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP
|
|
Year-to-Date
|
|
Year-to-Date
|
(in
millions)
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Revenue
|
|
|
|
|
|
|
|
Amount
|
$
|
90,162
|
|
|
$
|
74,983
|
|
|
|
|
|
Growth
rate
|
20%
|
|
|
10%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
Margin
|
|
|
|
|
|
|
|
Amount1
|
$
|
4,877
|
|
|
$
|
4,254
|
|
|
$
|
4,929
|
|
|
$
|
4,254
|
|
Growth
rate
|
15%
|
|
|
9%
|
|
|
16%
|
|
|
9%
|
|
|
|
|
|
|
|
|
|
Operating
earnings
|
|
|
|
|
|
|
|
Amount
|
$
|
1,839
|
|
|
$
|
1,603
|
|
|
$
|
2,251
|
|
|
$
|
1,861
|
|
Growth
rate
|
15%
|
|
|
7%
|
|
|
21%
|
|
|
11%
|
|
|
|
|
|
|
|
|
|
Net earnings
attributable to Cardinal Health, Inc.
|
|
|
|
|
|
|
|
Amount
|
$
|
1,095
|
|
|
$
|
920
|
|
|
$
|
1,361
|
|
|
$
|
1,136
|
|
Growth
rate
|
19%
|
|
|
(1)%
|
|
|
20%
|
|
|
9%
|
|
|
|
|
|
|
|
|
|
Return on
equity
|
22.3%
|
|
|
19.5%
|
|
|
27.7%
|
|
|
24.1%
|
|
|
|
|
|
|
|
|
|
Effective tax
rate
|
35.5%
|
|
|
36.3%
|
|
|
35.6%
|
|
|
35.6%
|
|
|
|
1
GAAP gross margin
includes the negative impact of a $12 million LIFO charge in the
third quarter of fiscal 2016 ($51 million year-to-date).
|
|
Refer to the
GAAP/Non-GAAP reconciliation for definitions and calculations
supporting the Non-GAAP balances.
|
Schedule
6
|
|
Cardinal Health,
Inc. and Subsidiaries
|
Segment Business
Analysis
|
|
|
Third
Quarter
|
|
|
Third
Quarter
|
(in
millions)
|
2016
|
|
2015
|
|
(in
millions)
|
2016
|
|
2015
|
Pharmaceutical
|
|
|
|
|
Medical
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
Revenue
|
|
|
|
Amount
|
$
|
27,527
|
|
|
$
|
22,605
|
|
|
Amount
|
$
|
3,138
|
|
|
$
|
2,774
|
|
Growth
rate
|
22%
|
|
|
20%
|
|
|
Growth
rate
|
13%
|
|
|
4%
|
|
|
|
|
|
|
|
|
|
|
Segment
profit
|
|
|
|
|
Segment
profit
|
|
|
|
Amount
|
$
|
660
|
|
|
$
|
567
|
|
|
Amount
|
$
|
128
|
|
|
$
|
102
|
|
Growth
rate
|
16%
|
|
|
25%
|
|
|
Growth
rate1
|
26%
|
|
|
(8)%
|
|
Segment profit
margin
|
2.40%
|
|
|
2.51%
|
|
|
Segment profit
margin
|
4.08%
|
|
|
3.66%
|
|
|
|
1 Segment profit includes a $21 million impact from the
roll-out of the inventory fair value step up related to the Cordis
acquisition for the three months ended March 31, 2016. Excluding
the impact of the inventory fair value step up, Medical segment
profit would have increased 47% for the three months ended March
31, 2016.
|
|
Refer to definitions
for an explanation of calculations.
|
|
Total consolidated
revenue for the three months ended March 31, 2016 was $30,662
million, which included total segment revenue of $30,665 million
and Corporate revenue of $(3) million. Total consolidated revenue
for the three months ended March 31, 2015 was $25,375 million,
which included total segment revenue of $25,379 million and
Corporate revenue of $(4) million. Corporate revenue consists
primarily of elimination of inter-segment revenue and other revenue
not allocated to the segments.
|
|
Total consolidated
operating earnings for the three months ended March 31, 2016
were $656 million, which included total segment profit of $788
million and Corporate costs of $(132) million. Total consolidated
operating earnings for the three months ended March 31, 2015
were $591 million, which included total segment profit of $669
million and Corporate costs of $(78) million. Corporate includes,
among other things, LIFO (charges)/credits, restructuring and
employee severance, amortization and other acquisition-related
costs, impairments and (gain)/loss on disposal of assets,
litigation (recoveries)/charges, net, and certain investment
spending that are not allocated to the segments.
|
Schedule
7
|
|
Cardinal Health,
Inc. and Subsidiaries
|
Segment Business
Analysis
|
|
|
Year-to-Date
|
|
|
Year-to-Date
|
(in
millions)
|
2016
|
|
2015
|
|
(in
millions)
|
2016
|
|
2015
|
Pharmaceutical
|
|
|
|
|
Medical
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
Revenue
|
|
|
|
Amount
|
$
|
80,954
|
|
|
$
|
66,440
|
|
|
Amount
|
$
|
9,220
|
|
|
$
|
8,540
|
|
Growth
rate
|
22%
|
|
|
11%
|
|
|
Growth
rate
|
8%
|
|
|
5%
|
|
|
|
|
|
|
|
|
|
|
Segment
profit
|
|
|
|
|
Segment
profit
|
|
|
|
Amount
|
$
|
1,945
|
|
|
$
|
1,559
|
|
|
Amount
|
$
|
335
|
|
|
$
|
330
|
|
Growth
rate
|
25%
|
|
|
14%
|
|
|
Growth
rate1
|
1%
|
|
|
(5)%
|
|
Segment profit
margin
|
2.40%
|
|
|
2.35%
|
|
|
Segment profit
margin
|
3.63%
|
|
|
3.86%
|
|
|
|
1 Segment profit includes a $43 million impact from the
roll-out of the inventory fair value step up related to the Cordis
acquisition for the nine months ended March 31, 2016. Excluding the
impact of the inventory fair value step up, Medical segment profit
growth would have been 14% for the nine months ended March 31,
2016.
|
|
Refer to definitions
for an explanation of calculations.
|
|
Total consolidated
revenue for the nine months ended March 31, 2016 was $90,162
million, which included total segment revenue of $90,174 million
and Corporate revenue of $(12) million. Total consolidated revenue
for the nine months ended March 31, 2015 was $74,983 million,
which included total segment revenue of $74,980 million and
Corporate revenue of $3 million. Corporate revenue consists
primarily of elimination of inter-segment revenue and other revenue
not allocated to the segments.
|
|
Total consolidated
operating earnings for the nine months ended March 31, 2016
were $1,839 million, which included total segment profit of $2,280
million and Corporate costs of $(441) million. Total consolidated
operating earnings for the nine months ended March 31, 2015
were $1,603 million, which included total segment profit of $1,889
million and Corporate costs of $(286) million. Corporate includes,
among other things, LIFO charges/(credits), restructuring and
employee severance, amortization and other acquisition-related
costs, impairments and (gain)/loss on disposal of assets,
litigation (recoveries)/charges, net and certain investment
spending that are not allocated to the segments.
|
Schedule
8
|
|
Cardinal Health,
Inc. and Subsidiaries
|
GAAP / Non-GAAP
Reconciliation
|
|
|
|
|
|
|
|
|
|
Net
Earnings
|
Diluted
|
Diluted
EPS
|
|
|
Gross
|
|
Operating
|
Earnings
|
Provision
|
Net
Earnings
|
attributable
|
EPS
|
attributable
|
|
|
Margin
|
|
Earnings
|
Before
|
for
|
attributable
|
to
Cardinal
|
attributable
|
to
Cardinal
|
|
Gross
|
Growth
|
Operating
|
Growth
|
Income
|
Income
|
to
Cardinal
|
Health,
Inc.
|
to
Cardinal
|
Health,
Inc.
|
(in millions, except
per common share amounts)
|
Margin
|
Rate
|
Earnings
|
Rate
|
Taxes
|
Taxes
|
Health,
Inc.
|
Growth
Rate
|
Health,
Inc.
|
Growth
Rate
|
Third Quarter
2016
|
GAAP
|
$
|
1,689
|
|
16%
|
$
|
656
|
|
11%
|
$
|
612
|
|
$
|
226
|
|
$
|
386
|
|
6%
|
$
|
1.17
|
|
7%
|
LIFO
charges/(credits)
|
12
|
|
|
12
|
|
|
12
|
|
4
|
|
8
|
|
|
0.02
|
|
|
Restructuring and
employee severance
|
—
|
|
|
6
|
|
|
6
|
|
2
|
|
4
|
|
|
0.01
|
|
|
Amortization and
other acquisition-related costs
|
—
|
|
|
108
|
|
|
108
|
|
37
|
|
71
|
|
|
0.21
|
|
|
Impairments and
(gain)/loss on disposal of assets
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
Litigation
(recoveries)/charges, net
|
—
|
|
|
5
|
|
|
5
|
|
2
|
|
3
|
|
|
0.01
|
|
|
Non-GAAP
|
$
|
1,702
|
|
17%
|
$
|
788
|
|
20%
|
$
|
744
|
|
$
|
272
|
|
$
|
472
|
|
19%
|
$
|
1.43
|
|
20%
|
|
|
|
|
|
|
|
|
|
|
|
|
Third Quarter
2015
|
GAAP
|
$
|
1,459
|
|
12%
|
$
|
591
|
|
16%
|
$
|
558
|
|
$
|
193
|
|
$
|
365
|
|
16%
|
$
|
1.09
|
|
20%
|
Restructuring and
employee severance
|
—
|
|
|
7
|
|
|
7
|
|
3
|
|
4
|
|
|
0.01
|
|
|
Amortization and
other acquisition-related costs
|
—
|
|
|
77
|
|
|
77
|
|
29
|
|
48
|
|
|
0.15
|
|
|
Impairments and
(gain)/loss on disposal of assets
|
—
|
|
|
(1)
|
|
|
(1)
|
|
(1)
|
|
—
|
|
|
—
|
|
|
Litigation
(recoveries)/charges, net
|
—
|
|
|
(18)
|
|
|
(18)
|
|
3
|
|
(21)
|
|
|
(0.07)
|
|
|
Non-GAAP
|
$
|
1,459
|
|
12%
|
$
|
657
|
|
17%
|
$
|
624
|
|
$
|
228
|
|
$
|
396
|
|
13%
|
$
|
1.19
|
|
18%
|
|
|
|
|
|
|
|
|
|
|
Net
Earnings
|
Diluted
|
Diluted
EPS
|
|
|
Gross
|
|
Operating
|
Earnings
|
Provision
|
Net
Earnings
|
attributable
|
EPS
|
attributable
|
|
|
Margin
|
|
Earnings
|
Before
|
for
|
attributable
|
to
Cardinal
|
attributable
|
to
Cardinal
|
|
Gross
|
Growth
|
Operating
|
Growth
|
Income
|
Income
|
to
Cardinal
|
Health,
Inc.
|
to
Cardinal
|
Health,
Inc.
|
(in millions, except
per common share amounts)
|
Margin
|
Rate
|
Earnings
|
Rate
|
Taxes
|
Taxes
|
Health,
Inc.
|
Growth
Rate
|
Health,
Inc.
|
Growth
Rate
|
Year-to-Date
2016
|
GAAP
|
$
|
4,877
|
|
15%
|
$
|
1,839
|
|
15%
|
$
|
1,700
|
|
$
|
604
|
|
$
|
1,095
|
|
19%
|
$
|
3.30
|
|
20%
|
LIFO
charges/(credits)
|
51
|
|
|
51
|
|
|
51
|
|
20
|
|
31
|
|
|
0.10
|
|
|
Restructuring and
employee severance
|
—
|
|
|
19
|
|
|
19
|
|
7
|
|
12
|
|
|
0.04
|
|
|
Amortization and
other acquisition-related costs
|
—
|
|
|
327
|
|
|
327
|
|
115
|
|
212
|
|
|
0.64
|
|
|
Impairments and
(gain)/loss on disposal of assets
|
—
|
|
|
17
|
|
|
17
|
|
7
|
|
10
|
|
|
0.03
|
|
|
Litigation
(recoveries)/charges, net
|
—
|
|
|
(3)
|
|
|
(3)
|
|
(3)
|
|
—
|
|
|
—
|
|
|
Non-GAAP
|
$
|
4,929
|
|
16%
|
$
|
2,251
|
|
21%
|
$
|
2,112
|
|
$
|
751
|
|
$
|
1,361
|
|
20%
|
$
|
4.10
|
|
21%
|
|
|
|
|
|
|
|
|
|
|
|
|
Year-to-Date
2015
|
GAAP
|
$
|
4,254
|
|
9%
|
$
|
1,603
|
|
7%
|
$
|
1,444
|
|
$
|
524
|
|
$
|
920
|
|
(1)%
|
$
|
2.74
|
|
2%
|
Restructuring and
employee severance
|
—
|
|
|
33
|
|
|
33
|
|
12
|
|
21
|
|
|
0.06
|
|
|
Amortization and
other acquisition-related costs
|
—
|
|
|
190
|
|
|
190
|
|
69
|
|
121
|
|
|
0.36
|
|
|
Impairments and
(gain)/loss on disposal of assets
|
—
|
|
|
(19)
|
|
|
(19)
|
|
(10)
|
|
(9)
|
|
|
(0.03)
|
|
|
Litigation
(recoveries)/charges, net
|
—
|
|
|
54
|
|
|
54
|
|
8
|
|
46
|
|
|
0.14
|
|
|
Loss on
extinguishment of debt
|
—
|
|
|
—
|
|
|
60
|
|
23
|
|
37
|
|
|
0.11
|
|
|
Non-GAAP
|
$
|
4,254
|
|
9%
|
$
|
1,861
|
|
11%
|
$
|
1,763
|
|
$
|
627
|
|
$
|
1,136
|
|
9%
|
$
|
3.38
|
|
12%
|
|
The sum of the
components may not equal the total due to rounding.
|
|
We apply varying tax
rates depending on the item's nature and tax jurisdiction where it
is incurred.
|
Schedule
9
|
|
Cardinal Health,
Inc. and Subsidiaries
|
GAAP / Non-GAAP
Reconciliation
|
|
|
Third
Quarter
|
|
|
(in
millions)
|
2016
|
|
|
|
2015
|
|
|
GAAP return on
equity
|
23%
|
|
|
|
|
23.4%
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP return on
equity
|
|
|
|
|
|
|
|
Net earnings
attributable to Cardinal Health, Inc.
|
$
|
386
|
|
|
|
|
$
|
365
|
|
|
|
LIFO
charges/(credits), net of tax
|
8
|
|
|
|
|
—
|
|
|
|
Restructuring and
employee severance, net of tax
|
4
|
|
|
|
|
4
|
|
|
|
Amortization and
other acquisition-related costs, net of tax
|
71
|
|
|
|
|
48
|
|
|
|
Litigation
(recoveries)/charges, net, net of tax
|
3
|
|
|
|
|
(21)
|
|
|
|
Adjusted net earnings
attributable to Cardinal Health, Inc.
|
$
|
472
|
|
|
|
|
$
|
396
|
|
|
|
Annualized
|
$
|
1,889
|
|
|
|
|
$
|
1,584
|
|
|
|
|
|
|
|
|
|
|
|
|
Third
|
|
Second
|
|
Third
|
|
Second
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
2016
|
|
2016
|
|
2015
|
|
2015
|
Total Cardinal
Health, Inc. shareholders' equity
|
$
|
6,713
|
|
|
$
|
6,711
|
|
|
$
|
6,369
|
|
|
$
|
6,100
|
|
Divided by average
Cardinal Health, Inc. shareholders' equity
|
$
|
6,712
|
|
|
|
|
$
|
6,235
|
|
|
|
Non-GAAP return on
equity
|
28.1%
|
|
|
|
|
25.4%
|
|
|
|
|
The sum of the
components may not equal the total due to rounding.
|
|
We apply varying tax
rates depending on the item's nature and tax jurisdiction where it
is incurred.
|
Schedule
10
|
|
Cardinal Health,
Inc. and Subsidiaries
|
GAAP / Non-GAAP
Reconciliation
|
|
|
Year-to-Date
|
|
|
|
|
|
|
(in
millions)
|
2016
|
|
|
|
|
|
|
|
2015
|
|
|
|
|
|
|
GAAP return on
equity
|
22.3%
|
|
|
|
|
|
|
|
|
19.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP return on
equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
attributable to Cardinal Health, Inc.
|
$
|
1,095
|
|
|
|
|
|
|
|
|
$
|
920
|
|
|
|
|
|
|
|
LIFO
charges/(credits), net of tax
|
31
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
Restructuring and
employee severance, net of tax
|
12
|
|
|
|
|
|
|
|
|
21
|
|
|
|
|
|
|
|
Amortization and
other acquisition-related costs, net of tax
|
212
|
|
|
|
|
|
|
|
|
121
|
|
|
|
|
|
|
|
Impairments and
(gain)/loss on disposal of assets, net of tax
|
10
|
|
|
|
|
|
|
|
|
(9)
|
|
|
|
|
|
|
|
Litigation
(recoveries)/charges, net, net of tax
|
—
|
|
|
|
|
|
|
|
|
46
|
|
|
|
|
|
|
|
Loss on
extinguishment of debt, net of tax
|
—
|
|
|
|
|
|
|
|
|
37
|
|
|
|
|
|
|
|
Adjusted net earnings
attributable to Cardinal Health, Inc.
|
$
|
1,361
|
|
|
|
|
|
|
|
|
$
|
1,136
|
|
|
|
|
|
|
|
Annualized
|
$
|
1,815
|
|
|
|
|
|
|
|
|
$
|
1,515
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Third
|
|
Second
|
|
First
|
|
Fourth
|
|
Third
|
|
Second
|
|
First
|
|
Fourth
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
2016
|
|
2016
|
|
2016
|
|
2015
|
|
2015
|
|
2015
|
|
2015
|
|
2014
|
Total Cardinal
Health, Inc. shareholders' equity
|
$
|
6,713
|
|
|
$
|
6,711
|
|
|
$
|
6,505
|
|
|
$
|
6,256
|
|
|
$
|
6,369
|
|
|
$
|
6,100
|
|
|
$
|
6,256
|
|
|
$
|
6,401
|
|
Divided by average
Cardinal Health, Inc. shareholders' equity
|
$
|
6,546
|
|
|
|
|
|
|
|
|
$
|
6,281
|
|
|
|
|
|
|
|
Non-GAAP return on
equity
|
27.7%
|
|
|
|
|
|
|
|
|
24.1%
|
|
|
|
|
|
|
|
|
The sum of the
components may not equal the total due to rounding.
|
|
We apply varying tax
rates depending on the item's nature and tax jurisdiction where it
is incurred.
|
Schedule
11
|
|
Cardinal Health,
Inc. and Subsidiaries
|
GAAP / Non-GAAP
Reconciliation
|
|
|
Third
Quarter
|
|
Year-to-Date
|
(in
millions)
|
2016
|
|
2015
|
|
2016
|
|
2015
|
GAAP effective tax
rate
|
36.9
|
%
|
|
34.6
|
%
|
|
35.5
|
%
|
|
36.3
|
%
|
|
|
|
|
|
|
|
|
Non-GAAP effective
tax rate
|
|
|
|
|
|
|
|
Earnings before
income taxes
|
$
|
612
|
|
|
$
|
558
|
|
|
$
|
1,700
|
|
|
$
|
1,444
|
|
LIFO
charges/(credits)
|
12
|
|
|
—
|
|
|
51
|
|
|
—
|
|
Restructuring and
employee severance
|
6
|
|
|
7
|
|
|
19
|
|
|
33
|
|
Amortization and
other acquisition-related costs
|
108
|
|
|
77
|
|
|
327
|
|
|
190
|
|
Impairments and
(gain)/loss on disposal of assets
|
—
|
|
|
(1)
|
|
|
17
|
|
|
(19)
|
|
Litigation
(recoveries)/charges, net
|
5
|
|
|
(18)
|
|
|
(3)
|
|
|
54
|
|
Loss on
extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
60
|
|
Adjusted earnings
before income taxes
|
$
|
744
|
|
|
$
|
624
|
|
|
$
|
2,112
|
|
|
$
|
1,763
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
$
|
226
|
|
|
$
|
193
|
|
|
$
|
604
|
|
|
$
|
524
|
|
LIFO
charges/(credits) tax benefit
|
4
|
|
|
—
|
|
|
20
|
|
|
—
|
|
Restructuring and
employee severance tax benefit
|
2
|
|
|
3
|
|
|
7
|
|
|
12
|
|
Amortization and
other acquisition-related costs tax benefit
|
37
|
|
|
29
|
|
|
115
|
|
|
69
|
|
Impairments and
(gain)/loss on disposal of assets tax benefit/(expense)
|
—
|
|
|
(1)
|
|
|
7
|
|
|
(10)
|
|
Litigation
(recoveries)/charges, net tax benefit/(expense)
|
2
|
|
|
3
|
|
|
(3)
|
|
|
8
|
|
Loss on
extinguishment of debt tax benefit
|
—
|
|
|
—
|
|
|
—
|
|
|
23
|
|
Adjusted provision
for income taxes
|
$
|
272
|
|
|
$
|
228
|
|
|
$
|
751
|
|
|
$
|
627
|
|
|
|
|
|
|
|
|
|
Non-GAAP effective
tax rate
|
36.6
|
%
|
|
36.5
|
%
|
|
35.6
|
%
|
|
35.6
|
%
|
|
|
|
|
|
|
|
|
|
Third
Quarter
|
|
|
|
|
|
2016
|
|
2015
|
|
|
|
|
Debt to total
capital
|
45
|
%
|
|
39
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Net debt to
capital
|
|
|
|
|
|
|
|
Current portion of
long-term obligations and other short-term borrowings
|
$
|
351
|
|
|
$
|
283
|
|
|
|
|
|
Long-term
obligations, less current portion
|
5,195
|
|
|
3,720
|
|
|
|
|
|
Debt
|
$
|
5,546
|
|
|
$
|
4,003
|
|
|
|
|
|
Cash and
equivalents
|
(2,598)
|
|
|
(3,183)
|
|
|
|
|
|
Net debt
|
$
|
2,948
|
|
|
$
|
820
|
|
|
|
|
|
Total Cardinal
Health, Inc. shareholders' equity
|
6,713
|
|
|
6,369
|
|
|
|
|
|
Capital
|
$
|
9,661
|
|
|
$
|
7,189
|
|
|
|
|
|
Net debt to
capital
|
31
|
%
|
|
11
|
%
|
|
|
|
|
|
The sum of the
components may not equal the total due to rounding.
|
|
We apply varying tax
rates depending on the item's nature and tax jurisdiction where it
is incurred.
|
Forward-Looking Non-GAAP Financial Measures
We present non-GAAP net earnings attributable to Cardinal
Health, Inc. and non-GAAP effective tax rate (and presentations
derived from these financial measures, including per share
calculations) on a forward-looking basis. The most directly
comparable forward-looking GAAP measures are net earnings
attributable to Cardinal Health, Inc. and effective tax rate. We
are unable to provide a quantitative reconciliation of these
forward-looking non-GAAP measures to the most directly comparable
forward-looking GAAP measures because we cannot reliably forecast
LIFO charges/(credits), restructuring and employee severance,
amortization and other acquisition-related costs, impairments and
(gain)/loss on disposal of assets, litigation (recoveries)/charges,
net, and loss on extinguishment of debt, which are difficult to
predict and estimate and are primarily dependent on future events.
Please note that the unavailable reconciling items could
significantly impact our future financial results.
Cardinal Health, Inc. and Subsidiaries
Use of Non-GAAP Measures
This earnings release contains financial measures that are not
calculated in accordance with U.S. generally accepted accounting
principles ("GAAP"). In general, the measures exclude items
and charges that (i) management does not believe reflect Cardinal
Health, Inc.'s (the "Company") core business and relate more to
strategic, multi-year corporate activities; or (ii) relate to
activities or actions that may have occurred over multiple or in
prior periods without predictable trends. Management uses these
non-GAAP financial measures internally to evaluate the Company's
performance, evaluate the balance sheet, engage in financial and
operational planning and determine incentive compensation.
Management provides these non-GAAP financial measures to
investors as supplemental metrics to assist readers in assessing
the effects of items and events on its financial and operating
results and in comparing the Company's performance to that of its
competitors. However, the non-GAAP financial measures used by
the Company may be calculated differently from, and therefore may
not be comparable to, similarly titled measures used by other
companies.
The non-GAAP financial measures disclosed by the Company should
not be considered a substitute for, or superior to, financial
measures calculated in accordance with GAAP, and the financial
results calculated in accordance with GAAP and reconciliations to
those financial statements set forth above should be carefully
evaluated.
Definitions
Debt: long-term obligations plus short-term
borrowings.
Debt to Total Capital: debt divided by (debt plus total
Cardinal Health, Inc. shareholders' equity).
Net Debt: a Non-GAAP measure defined as debt minus (cash
and equivalents).
Net Debt to Capital: a Non-GAAP measure defined as net
debt divided by (net debt plus total Cardinal Health, Inc.
shareholders' equity).
Non-GAAP Diluted EPS attributable to Cardinal Health, Inc. or
"Non-GAAP Diluted EPS" or "Non-GAAP Diluted Earnings Per
Share": non-GAAP net earnings attributable to Cardinal Health,
Inc. divided by diluted weighted-average shares outstanding.
Non-GAAP Diluted EPS from continuing operations: non-GAAP
earnings from continuing operations divided by diluted
weighted-average shares outstanding.
Non-GAAP Effective Tax Rate: (provision for income taxes
adjusted for (1) LIFO charges/(credits)1, (2)
restructuring and employee severance2, (3) amortization
and other acquisition-related costs3, (4) impairments
and (gain)/loss on disposal of assets4, (5) litigation
(recoveries)/charges, net5, and (6) loss on
extinguishment of debt6) divided by (earnings before
income taxes adjusted for the same six items).
Non-GAAP Gross Margin: Gross margin excluding LIFO
charges/(credits).
Non-GAAP Net Earnings attributable to Cardinal Health, Inc.
or "Non-GAAP Net Earnings": net earnings attributable to
Cardinal Health, Inc. excluding (1) LIFO charges/(credits), (2)
restructuring and employee severance, (3) amortization and other
acquisition-related costs, (4) impairments and (gain)/loss on
disposal of assets, (5) litigation (recoveries)/charges, net, and
(6) loss on extinguishment of debt, each net of tax.
Non-GAAP Earnings from Continuing Operations: earnings
from continuing operations excluding (1) LIFO charges/(credits),
(2) restructuring and employee severance, (3) amortization and
other acquisition-related costs, (4) impairments and (gain)/loss on
disposal of assets, (5) litigation (recoveries)/charges, net, and
(6) loss on extinguishment of debt, each net of tax.
Non-GAAP Operating Earnings: operating earnings excluding
(1) LIFO charges/(credits), (2) restructuring and employee
severance, (3) amortization and other acquisition-related costs,
(4) impairments and (gain)/loss on disposal of assets, and (5)
litigation (recoveries)/charges, net.
Non-GAAP Return on Equity: (annualized current period net
earnings attributable to Cardinal Health, Inc. excluding (1) LIFO
charges/(credits), (2) restructuring and employee severance, (3)
amortization and other acquisition-related costs, (4) impairments
and (gain)/loss on disposal of assets, (5) litigation
(recoveries)/charges, net, and (6) loss on extinguishment of debt,
each net of tax) divided by average Cardinal Health, Inc.
shareholders' equity.
Return on Equity: annualized current period net earnings
attributable to Cardinal Health, Inc. divided by average Cardinal
Health, Inc. shareholders' equity.
Segment Profit: segment revenue minus (segment cost of
products sold and segment distribution, selling, general, and
administrative expenses).
Segment Profit Margin: segment profit divided by segment
revenue.
1
|
The inventories of
the Company's core pharmaceutical distribution facilities in the
Pharmaceutical segment are valued at the lower of cost, using the
LIFO method, or market. These charges or credits are included
in cost of products sold, and represent changes in the Company's
LIFO inventory reserve.
|
|
|
2
|
Programs by which the
Company fundamentally changes its operations such as closing and
consolidating facilities, moving manufacturing of a product to
another location, production or business process sourcing, employee
severance (including rationalizing headcount or other significant
changes in personnel), and realigning operations (including
realignment of the management structure of a business unit in
response to changing market conditions).
|
|
|
3
|
Costs that consist
primarily of amortization of acquisition-related intangibles
assets, transaction costs, integration costs, and changes in the
fair value of contingent consideration obligations.
|
|
|
4
|
Asset impairments and
(gains)/losses from the disposal of assets not eligible to be
classified as discontinued operations are classified within
impairments and (gain)/loss on disposal of assets within the
condensed consolidated statements of earnings.
|
|
|
5
|
Loss contingencies
related to litigation and regulatory matters and income from
favorable resolution of legal matters.
|
|
|
6
|
Charges related to
the make-whole premium on the redemption of notes.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/cardinal-health-reports-strong-third-quarter-results-for-fiscal-year-2016-300259256.html
SOURCE Cardinal Health