Summary
McKesson Corporation reported a significant increase in revenue for the third quarter of fiscal year 2018, reaching $53.6 billion, up 7% year-over-year. This growth was primarily driven by its Distribution Solutions segment, particularly in North America, benefiting from market growth and strategic acquisitions. Despite revenue gains, net income attributable to McKesson Corporation saw a decrease of 18% for the first nine months of the year, totaling $1.21 billion, down from $1.48 billion in the prior year period. This decline was influenced by a substantial goodwill impairment charge of $350 million related to its European operations, restructuring and asset impairment charges in the UK, and increased operating expenses from acquisitions and business integration efforts. The company also reported a loss from its equity method investment in Change Healthcare, impacting profitability. Financially, McKesson maintained a solid liquidity position with $2.6 billion in cash and cash equivalents. The company continued its share repurchase program, demonstrating a commitment to returning capital to shareholders. However, investors should note the impact of significant non-cash charges related to goodwill impairment and restructuring, particularly in its European segment, which weigh on profitability. The company's outlook is subject to risks including changes in the healthcare industry, regulatory environments, and operational challenges in international markets.
Financial Highlights
53 data points| Revenue | $53.62B |
| Cost of Revenue | $50.90B |
| Gross Profit | $2.71B |
| Operating Expenses | $1.88B |
| Operating Income | $834.00M |
| Net Income | $903.00M |
| EPS (Basic) | $4.35 |
| EPS (Diluted) | $4.33 |
| Shares Outstanding (Basic) | 207.00M |
| Shares Outstanding (Diluted) | 208.00M |
Key Highlights
- 1Revenue increased by 7% to $53.6 billion for the third quarter, driven by the Distribution Solutions segment.
- 2Net income attributable to McKesson Corporation decreased by 18% for the first nine months, totaling $1.21 billion.
- 3A significant non-cash goodwill impairment charge of $350 million was recorded for McKesson Europe.
- 4Restructuring and asset impairment charges of $189 million and $53 million were recognized for the UK retail business.
- 5The company reported a loss of $90 million from its equity method investment in Change Healthcare for the quarter.
- 6Cash and cash equivalents remained strong at $2.6 billion.
- 7Share repurchases continued, with $1.8 billion authorized outstanding at the end of the period.