What is the overall financial performance of McKesson for the quarter?

McKesson reported a strong increase in revenue, up 23% to $12.16 billion, and a significant rise in net income to $79.0 million, or $0.27 per diluted share, compared to $61.9 million, or $0.22 per diluted share, in the same period last year. This growth was driven by robust performance in the Supply Solutions segment.

What are the key accounting changes impacting the financial results?

McKesson adopted SFAS No. 142, which eliminated the amortization of goodwill starting April 1, 2001. This change positively affects reported net income and earnings per share by removing goodwill amortization expenses that were previously recognized.

How are the company's different business segments performing?

The Supply Solutions segment, which is the largest contributor, saw a 24% revenue increase, primarily in pharmaceutical distribution. The Information Solutions segment also showed growth, with revenues up 7%, driven by software sales. Operating profit improved in both segments.

What is the status of McKesson's legal proceedings?

McKesson continues to address numerous legal proceedings related to past accounting improprieties at its subsidiary, HBOC. While some claims are being stayed pending other trials, several actions remain active, and the company is unable to predict the outcome or estimate potential losses, which could materially impact its financial position.

MCK 10-Q Quarterly Report Q2 FY2002 — Revenue, Net Income, EPS

Summary

McKesson Corporation's (MCK) third-quarter 2001 report indicates robust revenue growth across its segments, particularly in Supply Solutions, driven by pharmaceutical distribution and services. The company saw a significant increase in net income, rising to $79.0 million ($0.27 per diluted share) from $61.9 million ($0.22 per diluted share) in the prior year's quarter. This performance improvement is attributed to revenue growth and operating margin expansion. Key strategic shifts include the adoption of SFAS No. 142, discontinuing goodwill amortization, which positively impacts reported earnings. While the company is navigating ongoing legal proceedings related to past accounting improprieties, it is also actively managing its portfolio through divestitures, such as the sale of information solutions businesses. Investors should note the increase in inventory, linked to new distribution agreements, and the slight increase in the net debt-to-capital ratio.

Key Highlights

1Total revenues increased by 23% to $12.16 billion for the quarter ended September 30, 2001, compared to $9.87 billion in the prior year period.
2Net income grew to $79.0 million ($0.27 per diluted share) from $61.9 million ($0.22 per diluted share) year-over-year.
3The company adopted SFAS No. 142, discontinuing goodwill amortization effective April 1, 2001, which improved reported earnings.
4Supply Solutions segment revenues rose 24%, driven by strong performance in Pharmaceutical Distribution & Services.
5Information Solutions segment revenues grew by 7%, with notable increases in software sales.
6Operating profit for Supply Solutions increased by 11% to $176.0 million, and for Information Solutions, it improved significantly to $14.5 million from a loss of $0.6 million in the prior year quarter.
7The company continues to address legal proceedings related to past accounting issues, with several cases ongoing but some claims being stayed.
8Inventories increased significantly to $5.7 billion, attributed to the implementation of new pharmaceutical distribution agreements.

MCKESSON CORP Quarterly Report for Q2 Ended Sep 30, 2001

Summary

Key Highlights

Frequently Asked Questions