Summary
Cardinal Health Inc. reported its second quarter fiscal year 2023 results, highlighting a 13% increase in revenue to $51.5 billion, driven primarily by branded and specialty pharmaceutical sales. While overall revenue showed strong growth, the company experienced a GAAP operating loss of $119 million. This loss was significantly influenced by a substantial goodwill impairment charge of $709 million related to its Medical segment. On a non-GAAP basis, which excludes these charges and other one-time items, the company reported operating earnings of $467 million and diluted EPS of $1.32, showing a slight increase of 4% year-over-year. The Pharmaceutical segment showed robust profit growth, while the Medical segment's profit declined due to lower volumes and inflationary pressures. The company's liquidity remains adequate, with $3.7 billion in cash and equivalents. Net cash provided by operating activities was $620 million for the six months ended December 31, 2022, though this was impacted by the second annual payment of $372 million for opioid lawsuit settlements. Cardinal Health also continued its capital deployment through share repurchases totaling $1.3 billion and dividend payments. The company faces ongoing challenges from inflation and supply chain costs, particularly impacting the Medical segment, and is implementing pricing strategies to mitigate these effects. Significant developments include the ongoing review initiated by the Shareholder Cooperation Agreement with Elliott.
Financial Highlights
47 data points| Revenue | $51.47B |
| Cost of Revenue | $49.78B |
| Gross Profit | $1.68B |
| SG&A Expenses | $1.18B |
| Operating Income | -$86.00M |
| Interest Expense | $24.00M |
| Net Income | -$77.00M |
| EPS (Basic) | $-0.30 |
| EPS (Diluted) | $-0.30 |
| Shares Outstanding (Basic) | 261.00M |
| Shares Outstanding (Diluted) | 261.00M |
Key Highlights
- 1Total revenue increased by 13% to $51.5 billion for the quarter, primarily due to growth in pharmaceutical sales.
- 2GAAP operating loss of $119 million was recorded, largely due to a $709 million goodwill impairment charge in the Medical segment.
- 3Non-GAAP operating earnings remained stable at $467 million, with non-GAAP diluted EPS increasing by 4% to $1.32, driven by a lower share count.
- 4Pharmaceutical segment profit increased by 9% year-over-year, benefiting from branded and specialty pharmaceutical products and the generics program.
- 5Medical segment profit decreased by 66% year-over-year due to lower volumes and inflationary cost pressures.
- 6The company ended the quarter with $3.7 billion in cash and equivalents, and generated $620 million in operating cash flow for the first six months of the fiscal year.
- 7Significant share repurchases of $1.3 billion were made during the six-month period.