Summary
Cardinal Health Inc. (CAH) reported robust revenue growth in fiscal year 2012, reaching $107.6 billion, driven by strong performance in its Pharmaceutical segment and contributions from acquisitions. The company's operating earnings increased by 18% to $1.8 billion. Key drivers included effective generic pharmaceutical programs and strategic acquisitions that bolstered both revenue and profit. Despite overall growth, the company faces significant customer concentration, with its top two customers, CVS and Walgreens, accounting for a substantial portion of its revenue. The upcoming expiration of major contracts, particularly with Express Scripts, Inc., which provided $9.0 billion in revenue in fiscal 2012, poses a notable risk. The company is also navigating regulatory scrutiny, including a settlement with the DEA regarding controlled substance distribution at its Lakeland, Florida facility, which resulted in a suspension of its registration for these substances until May 2014. The company's financial health remains solid, with increased cash and equivalents and ongoing capital deployment through dividends and share repurchases.
Financial Highlights
50 data points| Revenue | $107.55B |
| Cost of Revenue | $103.01B |
| Gross Profit | $4.54B |
| SG&A Expenses | $2.68B |
| Operating Income | $1.79B |
| Interest Expense | $95.00M |
| Net Income | $1.07B |
| EPS (Basic) | $3.10 |
| EPS (Diluted) | $3.06 |
| Shares Outstanding (Basic) | 345.00M |
| Shares Outstanding (Diluted) | 349.00M |
Key Highlights
- 1Total revenue for fiscal year 2012 reached $107.6 billion, a 5% increase from the previous year, demonstrating continued top-line growth.
- 2Operating earnings saw a significant improvement, increasing by 18% to $1.8 billion, indicating enhanced profitability.
- 3The Pharmaceutical segment was a key driver of growth, with strong performance in generic programs and the positive impact of acquisitions contributing to a 17% increase in segment profit.
- 4Significant customer concentration exists, with CVS and Walgreens accounting for 43% of total revenue in fiscal 2012, highlighting reliance on a few key clients.
- 5The company faces a material risk due to the non-renewal of its pharmaceutical distribution contract with Express Scripts, Inc., which generated $9.0 billion in revenue in fiscal 2012.
- 6Cardinal Health entered into a settlement with the DEA regarding its Lakeland, Florida distribution center, resulting in a suspension of its controlled substance distribution registration until May 2014.
- 7The company continued to return value to shareholders through dividends and share repurchases, with a 10% increase in quarterly dividends and $450 million in share repurchases during fiscal 2012.