Cardinal Health11.13.15
Not a bad start to the fiscal year.
Cardinal Health reports a 17 percent increase in first-quarter 2016 revenue and 38 percent spike in non-GAAP diluted earnings per share (EPS). Revenue totaled $28.1 billion and diluted EPS came to $1.38 for the three months ending Sept. 30, according to the company's latest earnings statement.
Non-GAAP (generally accepted accounting principles) operating earnings jumped 30 percent to $737 million. On a GAAP basis, operating earnings increased 33 percent to $620 million, and diluted EPS increased 47 percent to $1.15.
"We are off to a very strong start to our fiscal 2016," Chairman/CEO George Barrett said. "We reported outstanding progress on both the top and bottom lines, reflecting strong execution and alignment with the needs of our customers in an evolving market. Our Pharmaceutical segment continued its momentum into the first quarter, and the Medical segment strengthened its position in strategically critical areas. Subsequent to the quarter end, we closed the Cordis acquisition. Our team did an outstanding job meeting our expected timeline for closing, positioning us to strengthen our offerings in the interventional cardiovascular space and reinforce our physician preference product strategy."
The Pharmaceutical segment clearly outperformed its Medical sibling, posting a 19 percent rise in Q1 revenue to $25.1 billion due to existing and new customer growth as well as contributions from acquisitions. Segment profit for the quarter rose 46 percent to $657 million.
First-quarter revenue for the Medical segment, contrarily, increased 2 percent to $2.9 billion due to gains in Cardinal Health-branded products and the Cardinal Health at Home platform. Segment profit fell 11 percent to $101 million, thanks largely to the company's Canada business and the some unfavorable impact of foreign currency. Included in the prior year results for Canada is a previously disclosed, one-time benefit resulting from winding down the CareFusion contract.
During the quarter, Cardinal Health rolled out the Hospital Quality at Home brand –-- a new range of over-the-counter hospital-quality products. These offerings are specially intended to help caregivers transition care from the hospital to home. The new product line includes a wide array of hospital-quality products such as Advanced Wound Care, First Aid, Personal Care and Home Healthcare. Management at Cardinal Health is certain that these products will speed up the healing process by providing a comfortable environment.
On Oct 4, Cardinal Health completed the acquisition of Johnson & Johnson's Cordis business unit for $1.944 billion which was announced in March this year. The addition of the Cordis unit is expected to strengthen Cardinal Health’s position in the cardiovascular market. The newly-acquired business will be integrated into Cardinal Health’s Medical segment.
Notably, Cardinal Health expects the deal to add 20 cents (including 7 to 8 cents of interest expense) to fiscal 2017 adjusted EPS and save $100 million in annual costs by the end of fiscal 2018.
Cardinal Health raised its fiscal 2016 adjusted earnings guidance range to $5.15-$5.35 from the previous range of $4.85–$5.05. This new range reflects an 18 percent to 22 percent growth rate compared with fiscal 2015.
Cardinal Health reports a 17 percent increase in first-quarter 2016 revenue and 38 percent spike in non-GAAP diluted earnings per share (EPS). Revenue totaled $28.1 billion and diluted EPS came to $1.38 for the three months ending Sept. 30, according to the company's latest earnings statement.
Non-GAAP (generally accepted accounting principles) operating earnings jumped 30 percent to $737 million. On a GAAP basis, operating earnings increased 33 percent to $620 million, and diluted EPS increased 47 percent to $1.15.
"We are off to a very strong start to our fiscal 2016," Chairman/CEO George Barrett said. "We reported outstanding progress on both the top and bottom lines, reflecting strong execution and alignment with the needs of our customers in an evolving market. Our Pharmaceutical segment continued its momentum into the first quarter, and the Medical segment strengthened its position in strategically critical areas. Subsequent to the quarter end, we closed the Cordis acquisition. Our team did an outstanding job meeting our expected timeline for closing, positioning us to strengthen our offerings in the interventional cardiovascular space and reinforce our physician preference product strategy."
The Pharmaceutical segment clearly outperformed its Medical sibling, posting a 19 percent rise in Q1 revenue to $25.1 billion due to existing and new customer growth as well as contributions from acquisitions. Segment profit for the quarter rose 46 percent to $657 million.
First-quarter revenue for the Medical segment, contrarily, increased 2 percent to $2.9 billion due to gains in Cardinal Health-branded products and the Cardinal Health at Home platform. Segment profit fell 11 percent to $101 million, thanks largely to the company's Canada business and the some unfavorable impact of foreign currency. Included in the prior year results for Canada is a previously disclosed, one-time benefit resulting from winding down the CareFusion contract.
During the quarter, Cardinal Health rolled out the Hospital Quality at Home brand –-- a new range of over-the-counter hospital-quality products. These offerings are specially intended to help caregivers transition care from the hospital to home. The new product line includes a wide array of hospital-quality products such as Advanced Wound Care, First Aid, Personal Care and Home Healthcare. Management at Cardinal Health is certain that these products will speed up the healing process by providing a comfortable environment.
On Oct 4, Cardinal Health completed the acquisition of Johnson & Johnson's Cordis business unit for $1.944 billion which was announced in March this year. The addition of the Cordis unit is expected to strengthen Cardinal Health’s position in the cardiovascular market. The newly-acquired business will be integrated into Cardinal Health’s Medical segment.
Notably, Cardinal Health expects the deal to add 20 cents (including 7 to 8 cents of interest expense) to fiscal 2017 adjusted EPS and save $100 million in annual costs by the end of fiscal 2018.
Cardinal Health raised its fiscal 2016 adjusted earnings guidance range to $5.15-$5.35 from the previous range of $4.85–$5.05. This new range reflects an 18 percent to 22 percent growth rate compared with fiscal 2015.