Cardinal Health, Inc. · NYSE:CAH
Cardinal Health — Q4 FY2006 Earnings Presentation
23 slides from Cardinal Health's earnings presentation, Aug 3, 2006
Slide 1: 2006 Fourth Quarter Earnings
2006 Fourth Quarter Earnings August 3, 2006 Jeff Henderson Chief Financial Officer Financial Review
Slide 2: Forward-Looking and Adjusted Information
Forward-Looking and Adjusted Information Except for historical information, all other information in this presentation consists of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertai
Slide 3: Today's Agenda
Today's Agenda FY 2006 Q4 Results - Consolidated FY 2006 Q4 Results - Segments FY 2006 Results - Consolidated FY 2006 Financial Targets and Goals FY 2007 Financial Targets and Goals Other Items
Slide 4: Q4 FY 2006 Recap
Revenue Operating earnings Earnings from continuing operations Diluted EPS Operating cash flow Return on equity Q4 FY 2006 Recap $ M % Change 1 $21,708 12% $ 534 (2%) $ 339 12% $ 0.80 14% $ 506 15.9% $ M % Change 1 $ 569 (4%) $ 363 7% $ 0.86 9% GAAP Basis Excluding Special Items 18.6% Excluding Spec
Slide 5: Q4 Operating Earnings and EPS
Operating Earnings and EPS Q4 Operating Earnings and EPS 5
Slide 6: Q4 FY 2006 SG&A Spending
Q4 FY 2006 SG&A Spending Total consolidated SG&A growth - 15% Key Contributors: Equity compensation expense 7 pp One Cardinal Health spending 2 pp Compensation items: executive severance, bonus accrual and other 1 pp Acquisitions: Parmed, Dohmen and Denver Biomedical 1 pp
Slide 7: Business Analysis: Pharmaceutical Distribution and Provider Services
Cardinal Health Business Analysis Pharmaceutical Distribution and Provider Services Q4 FY '06 Q4 FY '05 $ M $ M % change Revenues $ 18,206 $ 15,688 16% Operating earnings $ 268 $ 302 (11%) Non-recurring and other items $ 1 Highlights: DSD (non-bulk) sales increased 8%; Bulk customer sales increased
Slide 8: Business Analysis: Medical Products and Services
Cardinal Health Business Analysis Medical Products and Services Q4 FY '06 Q4 FY '05 $ M $ M % change Revenues $ 2,373 $ 2,532 (6%) Operating earnings $ 170 $ 159 7% Non-recurring and other items $ 12 Highlights: Expected loss of largest customer in Specialty Pharmaceutical Distribution business and
Slide 9: Business Analysis: Pharmaceutical Technologies and Services
Cardinal Health Business Analysis Pharmaceutical Technologies and Services Q4 FY '06 Q4 FY '05 $ M $ M % change Revenues $ 747 $ 713 5% Operating earnings $ 96 $ 75 28% Highlights: Good earnings growth from oral technologies, packaging services and nuclear pharmacy services Strong demand for proprie
Slide 10: Business Analysis: Clinical Technologies and Services
Cardinal Health Business Analysis Clinical Technologies and Services Q4 FY '06 Q4 FY '05 $ M $ M % change Revenues $ 649 $ 596 9% Operating earnings $ 111 $ 75 47% Highlights: Strong demand for both Pyxis and Alaris products - strong committed contract volume New customer contract wins drive Pyxis a
Slide 11: FY 2006 Recap
Revenue Operating earnings Earnings from continuing operations Diluted EPS Operating cash flow Return on equity FY 2006 Recap $ M % Change 1 $81,364 10% $ 1,967 8% $ 1,245 12% $ 2.90 14% $ 2,163 14.4% $ M % Change 1 $ 2,062 1% $ 1,311 4% $ 3.06 6% GAAP Basis Excluding Special Items 16.9% Excluding S
Slide 12: FY 2006 Operating Earnings and EPS
Operating Earnings and EPS FY 2006 Operating Earnings and EPS 12
Slide 13: FY 2006 Second Half Metrics
FY 2006 — 2" Half Metrics Operating Margin PDPS MPS PTS cTs Actual Actual Actual 2" Half 1" Half 2" Half FY 2006 FY 2006 FY 2005 158% 1.38% 2.04% 7.06% 5.89% 6.82% 11.92% 9.56% 11.12% 16.94% 14.61% 11.96% CardinalHealth
Slide 14: FY 2006 Financial Targets & Goals
FY 2006 Financial Targets & Goals 14 Last provided on April 27, 2006
Slide 15: FY 2007 Financial Targets & Goals
FY 2007 Financial Targets & Goals
Slide 16: FY 2007 Key Performance Drivers
FY 2007 - Key Performance Drivers Strong customer demand and stable DSD (non-bulk) margins drive pharmaceutical distribution earnings Strong performance within higher margin manufacturing businesses Decline in equity compensation expense SG&A growth moderation Capital deployment
Slide 17: New Reporting Segments
New Reporting Segments Supply Chain Services Supply Chain Services - Pharmaceutical Supply Chain Services - Medical Pharmaceutical & Medical Products Medical Products Manufacturing Pharmaceutical Technologies and Services Clinical Technologies and Services
Slide 18: Q&A
Q&A CardinalHealth
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Slide 21: GAAP/Non-GAAP Reconciliation
CARDINAL HEALTH, ING. AND SUBSIDIARIES GAAP /NON-GAAP REGONGILIATION 2008 2005 {in milions) a a w a a [7 a a Operating Marain sare asim = aarim —zdemf] 20pm em atm 2.834 Operating Earrings, Excluding Special tems and Equity Gompensation Operating eamings b sme7 § 4904 6 a4 6 sua||S 0x0 § ao 8 HIS 8
Slide 22: Definitions and Calculations
GARDINAL HEALTH, ING. AND SUBSIDIARIES DEFINITIONS AND GALGULATIONS, GAME Debt to Total Gapital: debtdivded by (debt plus blalshareholien’ equity) Debt: curent period lns-em obligations plus curent period short-term borrowings Margin per Expense Dollar: gross margin divided by sling, general and adm
Slide 23: Cardinal Health
CardinalHealth Working together. For life.”