Summary
Cardinal Health Inc. reported a significant turnaround in its financial performance for the quarter ended September 30, 2010, compared to the same period in the prior year. The company achieved earnings from continuing operations of $294.4 million, a substantial improvement from a loss of $61.8 million in the prior year quarter. This positive shift was driven by a strong increase in gross margin, up 6% to $962.2 million, and a 52% surge in operating earnings to $363.9 million. Key factors contributing to this performance include the success of generic pharmaceutical programs and increased branded margins within the Pharmaceutical segment, as well as favorable comparisons due to the absence of significant restructuring and asset impairment charges recorded in the prior year. Operationally, total revenue saw a slight decrease of 1% to $24.4 billion, primarily due to customer losses and the impact of branded-to-generic pharmaceutical conversions in the Pharmaceutical segment, and the prior year's recognition of deferred intercompany revenue with CareFusion in the Medical segment. The company also completed the acquisition of P4 Healthcare for $509.1 million, expanding its presence in specialty pharmaceutical services. Furthermore, Cardinal Health finalized the sale of its remaining investment in CareFusion, realizing a $74.8 million gain. The company's liquidity remains robust, with cash and equivalents at $2.7 billion, supported by operating cash flow and the proceeds from the CareFusion investment sale, despite significant cash outflows for acquisitions and share repurchases.
Financial Highlights
48 data points| Revenue | $24.44B |
| Cost of Revenue | $23.48B |
| Gross Profit | $962.00M |
| SG&A Expenses | $581.00M |
| Operating Income | $363.90M |
| Interest Expense | $22.00M |
| Net Income | $295.00M |
| EPS (Basic) | $0.84 |
| EPS (Diluted) | $0.84 |
| Shares Outstanding (Basic) | 348.90M |
| Shares Outstanding (Diluted) | 351.90M |
Key Highlights
- 1Net earnings from continuing operations improved dramatically to $294.4 million from a loss of $61.8 million in the prior year's quarter.
- 2Gross margin increased by 6% to $962.2 million, driven by successful generic pharmaceutical programs and improved branded margins.
- 3Operating earnings saw a substantial increase of 52% to $363.9 million, aided by higher gross margins and the absence of significant prior-year charges.
- 4Total revenue slightly decreased by 1% to $24.4 billion, reflecting shifts in customer mix and product sales.
- 5Completed the acquisition of P4 Healthcare for $509.1 million to expand specialty pharmaceutical services.
- 6Finalized the sale of its remaining investment in CareFusion, recognizing a $74.8 million gain.
- 7Maintained a strong liquidity position with $2.7 billion in cash and equivalents, despite significant acquisitions and share repurchases.