Cardinal Health Conference Call Highlights

Cardinal Health CAH reported its quarterly earnings on Monday. Shares of the company are down 4.2 percent.

Below are some key highlights from its conference call:

Global, Growth, Results:

• Non-GAAP operating earnings grow 4 percent to $2.1 billion, while non-GAAP diluted earnings per share were $3.84, up 3 percent.
• And our gross margin rate expanded by 80 basis points to 5.7 percent for the year.
• Our team continued to drive capital efficiency this year, generating $2.5 billion in cash from operations.
• We returned over $1.1 billion to shareholders in fiscal 2014 through both our strong dividend and share buybacks.
• And I'm very pleased that we're able to provide our investors with a total shareholder return of 46.7 percent a year.
• Walgreens would have been a robust 8 percent for our Pharmaceutical segment. Our overall Pharmaceutical segment profit margin expanded almost 30 basis points for the year.
• Current data suggest that generics now represent over 85 percent of all prescriptions in the United States.
• Moving to the Medical segment, fiscal 2014 revenues grew 9 percent. Margin rate expanded by 35 basis points and segment profit grew at almost 20 percent.
• Our medical consumables business has represented an opportunity to use our scale to bring significant savings to the healthcare system, while at the same time expanding our margins.
• We saw full-year sales growth of 6 percent and launched over 500 new SKUs during FY 2014.
• A few comments on China. China has continued to be an outstanding growth story for us. In 2014, we grew revenues by 30 percent reaching $2.6 billion.
• So with this as backdrop, we are guiding to a fiscal year 2015, non-GAAP EPS range of $4.10 to $4.30.
• SG&A expenses moderately increased by 2.5 percent in Q4, driven by recent acquisitions and year-over-year compensation related items.
• Our consolidated non-GAAP operating margin rate increased 16 basis points to over 2 percent.
• The non-GAAP tax rate for the quarter was about 34 percent versus the prior year's 37 percent. This period lower rate is related to favorable state tax outcomes in the quarter.
• We have over $700 million remaining under board authorized repurchase program.
• Moving onto the consolidated cash flows and the balance sheet. Our operations generate $715 million in cash flow during the quarter.
• Pharma segment profit decreased by 5 percent to $377 million, primarily driven by the continued impact of the Walgreens contract termination, which was partially offset by strong performance in our generic programs.

Guidance:

• As George stated, for fiscal 2015, we expect our non-GAAP earnings per share to be in the range of $4.10 and $4.30 and we expect revenues will increase modestly.
• We expect net interest and other expense of $140 million $150 million.
• As the Medical segment performance ramps over fiscal 2015, we expect a relatively flat utilization environment in the acute settings and mid single-digit growth in the home setting.

Date
ticker
name
Actual EPS
EPS Surprise
Actual Rev
Rev Surprise
Posted In: EarningsNewsGuidance
We simplify the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!

Loading...