What was McKesson's primary financial performance in fiscal year 2021?

McKesson reported a 3% increase in total revenues, reaching $238.2 billion, primarily driven by growth in its U.S. Pharmaceutical segment. However, the company incurred a substantial net loss of $(4.5) billion, largely due to an $8.1 billion charge for estimated opioid-related claims.

How did COVID-19 impact McKesson's operations?

McKesson was involved in the distribution of COVID-19 vaccines and ancillary supplies, which positively contributed to its performance. While initial demand for pharmaceuticals saw a temporary increase, overall pharmaceutical distribution volumes fluctuated. The company also experienced increased demand for COVID-19 tests and PPE in its Medical-Surgical Solutions segment.

What is the nature of the significant litigation mentioned in the report?

The most significant litigation relates to opioid-related claims, where McKesson is a defendant in approximately 3,200 cases. The company recorded an $8.1 billion charge in fiscal year 2021 as an estimated liability for a probable broad settlement with governmental entities related to these claims.

How is McKesson returning value to shareholders?

In fiscal year 2021, McKesson returned approximately $1.0 billion to shareholders through $770 million in common stock repurchases and $276 million in dividend payments. The company also raised its quarterly dividend and has an ongoing share repurchase program.

MCK 10-K FY2021 Annual Report — Revenue, Net Income, EPS

Summary

McKesson Corporation's 2021 10-K report highlights a year of revenue growth driven primarily by its U.S. Pharmaceutical segment, which saw a 3% increase to $238.2 billion, largely due to market growth. The company played a significant role in the COVID-19 pandemic response, distributing vaccines and ancillary supplies, which positively impacted its Medical-Surgical Solutions and U.S. Pharmaceutical segments. However, the reported net loss attributable to McKesson Corporation was substantial at $(4.5) billion, primarily due to a significant charge of $8.1 billion related to its estimated liability for opioid-related claims. Despite this, the company returned $1.0 billion to shareholders through stock repurchases and dividends, and its financial condition remained strong with access to liquidity. The company also reorganized its business segments into four reportable divisions: U.S. Pharmaceutical, International, Medical-Surgical Solutions, and Prescription Technology Solutions.

Financial Highlights

56 data points

Beta

Revenue

$238.23B

0.1% Gross Margin

Net Income

-$4.54B

-0.0% Net Margin

EPS (Diluted)

$-28.26

Total Assets

$65.02B

Cash & Equivalents

$6.28B

Free Cash Flow

$4.09B

Financial Statements

Beta

Revenue	$238.23B
Cost of Revenue	$226.08B
Gross Profit	$12.15B
SG&A Expenses	$8.85B
Operating Expenses	$17.19B
Operating Income	-$5.04B
Interest Expense	$217.00M
Net Income	-$4.54B
EPS (Basic)	$-28.26
EPS (Diluted)	$-28.26
Shares Outstanding (Basic)	160.60M
Shares Outstanding (Diluted)	160.60M

Key Highlights

1Revenue increased by 3% to $238.2 billion, driven by the U.S. Pharmaceutical segment's market growth.
2McKesson played a key role in distributing COVID-19 vaccines and ancillary supplies, positively impacting revenue and operating profit in specific segments.
3Recorded a significant charge of $8.1 billion for estimated opioid-related claims, leading to a net loss attributable to McKesson Corporation of $(4.5) billion.
4Returned $1.0 billion to shareholders through stock repurchases ($770 million) and dividends ($276 million).
5Completed a reorganization of its business into four reportable segments: U.S. Pharmaceutical, International, Medical-Surgical Solutions, and Prescription Technology Solutions (RxTS).
6The company maintained a strong financial position and liquidity, with $4.0 billion in available credit facilities.
7The company is subject to ongoing litigation and regulatory scrutiny, most notably related to opioid distribution.

MCKESSON CORP Annual Report, Year Ended Mar 31, 2021

Summary

Financial Highlights

Key Highlights

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