MCKESSON CORP Quarterly Report for Q1 Ended Jun 30, 2024

Summary

McKesson Corporation reported total revenues of $79.3 billion for the fiscal second quarter ended June 30, 2024, a 6% increase compared to the prior year. This growth was primarily driven by its U.S. Pharmaceutical segment, benefiting from market growth in specialty pharmaceuticals and higher volumes. Despite revenue growth, net income attributable to McKesson Corporation saw a slight decrease to $915 million, or $7.00 per diluted share, down from $958 million, or $7.02 per diluted share, in the same period last year. This decline was influenced by increased operating expenses, particularly higher claims and litigation charges related to opioid settlements, and a decrease in gross profit margin. The company repurchased $528 million of its common stock and paid $82 million in dividends during the quarter, underscoring its commitment to returning capital to shareholders, with an additional $4.0 billion authorization for share repurchases approved in July 2024.

Key Highlights

• 1Revenues increased by 6% year-over-year to $79.3 billion, driven by the U.S. Pharmaceutical segment.
• 2Net income attributable to McKesson Corporation decreased slightly to $915 million ($7.00 per diluted share) from $958 million ($7.02 per diluted share) in the prior year quarter.
• 3Operating expenses increased by 10% due to higher claims and litigation charges related to opioid settlements ($114 million impact).
• 4The company returned $609 million to shareholders through $528 million in share repurchases and $82 million in dividends.
• 5McKesson received $90 million from antitrust legal settlements, recorded as a gain within Cost of Sales.
• 6A net discrete tax benefit of $125 million was recognized, primarily from an election to change the tax status of a foreign affiliate.
• 7The company's total estimated liability for opioid-related claims stood at $6.9 billion as of June 30, 2024.

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