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Cardinal Health(CAH) - 2024 Q3 - Quarterly Results
CAHCardinal Health(CAH)2024-05-02 10:50

Revenue Growth - Revenue increased 9% to 54.9billioninQ3FY24comparedtoQ3FY23[1][3]−RevenueforQ32024increasedby954.9 billion in Q3 FY24 compared to Q3 FY23[1][3] - Revenue for Q3 2024 increased by 9% to 54.911 billion compared to 50.487billioninQ32023[20]−Year−to−daterevenuefor2024increasedby1050.487 billion in Q3 2023[20] - Year-to-date revenue for 2024 increased by 10% to 167.119 billion compared to 151.559billionin2023[20]−PharmaceuticalandSpecialtySolutionssegmentrevenueincreased9151.559 billion in 2023[20] - Pharmaceutical and Specialty Solutions segment revenue increased 9% to 50.7 billion in Q3 FY24[5] - Other segment revenue increased 14% to 1.2billioninQ3FY24[8]−PharmaceuticalandSolutionssegmentrevenuegrew91.2 billion in Q3 FY24[8] - Pharmaceutical and Solutions segment revenue grew 9% YoY to 50,651 million in Q3 2024[26] - Global Medical Products and Distribution segment revenue grew 4% YoY to 3,113millioninQ32024[26]−Year−to−daterevenueforPharmaceuticalandSolutionssegmentgrew113,113 million in Q3 2024[26] - Year-to-date revenue for Pharmaceutical and Solutions segment grew 11% YoY to 154,524 million[27] - Year-to-date revenue for Global Medical Products and Distribution segment grew 1% YoY to 9,264million[27]Non−GAAPFinancialPerformance−Non−GAAPoperatingearningsincreased109,264 million[27] Non-GAAP Financial Performance - Non-GAAP operating earnings increased 10% to 666 million in Q3 FY24[1][3] - Non-GAAP diluted EPS increased 20% to 2.08inQ3FY24[1][3]−Fiscalyear2024non−GAAPEPSguidanceraisedto2.08 in Q3 FY24[1][3] - Fiscal year 2024 non-GAAP EPS guidance raised to 7.30 to 7.40[1][9]−Preliminaryfiscalyear2025non−GAAPEPSguidanceofatleast7.40[1][9] - Preliminary fiscal year 2025 non-GAAP EPS guidance of at least 7.50[1][10] - Non-GAAP net earnings for Q3 2024 were 509million,a14509 million, a 14% increase YoY[32] - Non-GAAP diluted EPS for Q3 2024 was 2.08, a 20% increase YoY[32] - Non-GAAP operating earnings for the nine months ended March 31, 2024, were 1,799million,witha201,799 million, with a 20% effective tax rate, resulting in a diluted EPS of 5.62, a 33% increase year-over-year[35] - Non-GAAP operating earnings for the nine months ended March 31, 2023, were 1,497million,witha211,497 million, with a 21% effective tax rate, resulting in a diluted EPS of 4.24[35] Segment Performance - Pharmaceutical and Specialty Solutions segment profit growth outlook updated to 8.5% to 9.5% for FY24[9] - Global Medical Products and Distribution segment profit increased 66millionto66 million to 20 million in Q3 FY24[6][7] - Global Medical Products and Distribution segment profit expected to be ~175millioninFY25[11]−ImpairmentchargesfortheGMPDsegmentwere175 million in FY25[11] - Impairment charges for the GMPD segment were 90 million in Q3 2024 and 671millionyear−to−date[20]−Thecompanyrecognizedacumulativepre−taxgoodwillimpairmentchargeof671 million year-to-date[20] - The company recognized a cumulative pre-tax goodwill impairment charge of 671 million related to the GMPD segment for the nine months ended March 31, 2024, with an estimated net tax benefit of 56million[35]−Thecompanyrecognizedacumulativepre−taxgoodwillimpairmentchargeof56 million[35] - The company recognized a cumulative pre-tax goodwill impairment charge of 863 million related to the GMPD segment for the nine months ended March 31, 2023, with a net tax benefit of 68million[35]GAAPFinancialPerformance−NetearningsforQ32024decreasedby2568 million[35] GAAP Financial Performance - Net earnings for Q3 2024 decreased by 25% to 259 million compared to 347millioninQ32023[20]−GAAPnetearningsforQ32024were347 million in Q3 2023[20] - GAAP net earnings for Q3 2024 were 258 million, a 25% decrease YoY[31] - GAAP diluted EPS for Q3 2024 was 1.05,a221.05, a 22% decrease YoY[31] - GAAP operating earnings for the nine months ended March 31, 2024, were 835 million, with a 42% effective tax rate, resulting in a diluted EPS of 2.49[35]−GAAPoperatingearningsfortheninemonthsendedMarch31,2023,were2.49[35] - GAAP operating earnings for the nine months ended March 31, 2023, were 590 million, with a 36.7% effective tax rate, resulting in a diluted EPS of 1.23[35]CashFlowandLiquidity−Cashandequivalentsdecreasedto1.23[35] Cash Flow and Liquidity - Cash and equivalents decreased to 3.718 billion as of March 31, 2024, from 4.043billionasofJune30,2023[22]−NetcashprovidedbyoperatingactivitiesinQ32024was−4.043 billion as of June 30, 2023[22] - Net cash provided by operating activities in Q3 2024 was -49 million, compared to 1,361millioninQ32023[25]−GAAPnetcashprovidedbyoperatingactivitiesfortheninemonthsendedMarch31,2024,was1,361 million in Q3 2023[25] - GAAP net cash provided by operating activities for the nine months ended March 31, 2024, was 1,685 million, compared to 1,981millionforthesameperiodin2023[37]−Non−GAAPadjustedfreecashflowfortheninemonthsendedMarch31,2024,was1,981 million for the same period in 2023[37] - Non-GAAP adjusted free cash flow for the nine months ended March 31, 2024, was 2,128 million, compared to 2,090millionforthesameperiodin2023[37]−Thecompanyexcluded2,090 million for the same period in 2023[37] - The company excluded 246 million in payments related to litigation recoveries/charges from non-GAAP adjusted free cash flow for the third quarter of 2024[37] Balance Sheet Changes - Total current assets increased to 35.734billionasofMarch31,2024,from35.734 billion as of March 31, 2024, from 33.833 billion as of June 30, 2023[22] - Total liabilities increased to 45.880billionasofMarch31,2024,from45.880 billion as of March 31, 2024, from 43.417 billion as of June 30, 2023[23] - Accounts payable increased to 32.089billionasofMarch31,2024,from32.089 billion as of March 31, 2024, from 29.813 billion as of June 30, 2023[23] - Total shareholders' deficit increased to 3.262billionasofMarch31,2024,from3.262 billion as of March 31, 2024, from 2.851 billion as of June 30, 2023[23] Gross Margin and Operating Earnings - Gross margin for Q3 2024 increased by 9% to 1.947billioncomparedto1.947 billion compared to 1.785 billion in Q3 2023[20] - Non-GAAP gross margin excludes LIFO charges/(credits)[44] - Non-GAAP SG&A excludes state opioid assessment related to prior fiscal years and shareholder cooperation agreement costs[44] - Non-GAAP operating earnings exclude LIFO charges/(credits), state opioid assessment, shareholder cooperation agreement costs, restructuring and employee severance, amortization and other acquisition-related costs, impairments and (gain)/loss on disposal of assets, net, and litigation (recoveries)/charges, net[44] Non-GAAP Adjustments and Definitions - The company's non-GAAP financial measures exclude items such as LIFO charges, state opioid assessments, shareholder cooperation agreement costs, restructuring costs, and acquisition-related costs to provide a clearer view of ongoing business performance[39] - Segment Profit is calculated as segment revenue minus segment cost of products sold and segment distribution, selling, general and administrative expenses[44] - Segment Profit margin is derived by dividing segment profit by segment revenue[44] - Non-GAAP earnings before income taxes exclude LIFO charges/(credits), state opioid assessment, shareholder cooperation agreement costs, restructuring and employee severance, amortization and other acquisition-related costs, impairments and (gain)/loss on disposal of assets, net, litigation (recoveries)/charges, net, and loss on early extinguishment of debt[44] - Non-GAAP net earnings attributable to Cardinal Health, Inc. exclude LIFO charges/(credits), state opioid assessment, shareholder cooperation agreement costs, restructuring and employee severance, amortization and other acquisition-related costs, impairments and (gain)/loss on disposal of assets, net, litigation (recoveries)/charges, net, and loss on early extinguishment of debt, each net of tax[44] - Non-GAAP effective tax rate adjusts for the tax impacts of LIFO charges/(credits), state opioid assessment, shareholder cooperation agreement costs, restructuring and employee severance, amortization and other acquisition-related costs, impairments and (gain)/loss on disposal of assets, net, litigation (recoveries)/charges, net, and loss on early extinguishment of debt[44] - Non-GAAP diluted earnings per share attributable to Cardinal Health, Inc. is calculated by dividing non-GAAP net earnings attributable to Cardinal Health, Inc. by diluted weighted-average shares outstanding[44] - Non-GAAP adjusted free cash flow is net cash provided by/(used in) operating activities less payments related to additions to property and equipment, excluding settlement payments and receipts related to litigation (recoveries)/charges, net, or other significant and unusual or non-recurring cash payments or receipts[44]