Slide 1: McKesson Corporation Second Quarter Fiscal 2025 Earnings Call
McKesson Corporation Second Quarter Fiscal 2025 Earnings Call November 6, 2024
Slide 2: Cautionary Statements
Cautionary Statements Cautionary Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward- looking statements may be identified by their use of terminology such as
Slide 3: Accelerating the Enterprise: Sustaining Long-Term Growth and Value
Accelerating the Enterprise Sustaining Long-Term Growth and Value • Integrity & Inclusion • Respect Our Purpose: • Customer-first • Excellence Advancing Health Outcomes for All® • Accountability Our Growth Pillars: Focus Expand Oncology Strengthen Modernize on People & Biopharma & Grow & Accelerate
Slide 4: Second Quarter Fiscal 2025 Results
Second Quarter Fiscal 2025 Results
Slide 5: Strategy and Execution Accelerating and Driving Sustainable Growth
Strategy and Execution Accelerating and Driving Sustainable Growth Business Summary Company Updates • Revenues of $93.7 billion increased 21% • Continued to advance the Oncology platform • Announced an agreement to acquire a controlling • Earnings per diluted share of $1.87 decreased $3.05 interest
Slide 6: Consolidated adjusted financial information
Consolidated adjusted financial information Q2 and YTD Fiscal 2025 Results Adjusted Results Q2 YoY YTD Q2 YoY ($ and shares in millions, except per share amounts) FY 25 Change FY 25 Change GAAP Revenues $ 93,651 21 % $ 172,934 14 % Gross Profit $ 3,246 7% $ 6,306 5% Operating Expenses $ (1,989) 7% $
Slide 7: Adjusted Earnings Per Share Results
Adjusted Earnings Per Share Results Fiscal 2025 Q2 year-over-year $0.15 $7.07 $0.22 $0.46 $(0.03) $0.04 $6.23 Q2 FY24 Operating McKesson Ventures Held-for-Sale Tax Rate Other1 Q2 FY25 Performance Adj. EPS Adj. EPS See endnotes for details 7 © 2024 McKesson Corporation. All rights reserved.
Slide 8: U.S. Pharmaceutical
U.S. Pharmaceutical Q2 and YTD Fiscal 2025 Results Results Q2 YoY YTD Q2 YoY ($ in millions) FY 25 Change FY 25 Change U.S. Pharmaceutical Revenues $ 85,726 23 % $ 157,441 15 % Adjusted Segment Operating Profit $ 902 11 % $ 1,717 8% Adjusted Segment Operating Profit Margin 1.05 % (12) bp 1.09 % (7)
Slide 9: Prescription Technology Solutions
Prescription Technology Solutions Q2 and YTD Fiscal 2025 Results Results Q2 YoY YTD Q2 YoY ($ in millions) FY 25 Change FY 25 Change Prescription Technology Solutions Revenues $ 1,265 11 % $ 2,506 5% Adjusted Segment Operating Profit $ 218 4% $ 441 2% Adjusted Segment Operating Profit Margin 17.23 %
Slide 10: Medical-Surgical Solutions
Medical-Surgical Solutions Q2 and YTD Fiscal 2025 Results Results Q2 YoY YTD Q2 YoY ($ in millions) FY 25 Change FY 25 Change Medical-Surgical Solutions Revenues $ 2,948 4% $ 5,584 3% Adjusted Segment Operating Profit $ 243 (4) % $ 443 (9) % Adjusted Segment Operating Profit Margin 8.24 % (72) bp 7.
Slide 11: International
International Q2 and YTD Fiscal 2025 Results Results Q2 YoY YTD Q2 YoY ($ in millions) FY 25 Change FY 25 Change International Revenues $ 3,709 7% $ 7,400 7% Adjusted Segment Operating Profit $ 100 12 % $ 202 13 % Adjusted Segment Operating Profit Margin 2.70 % 14 bp 2.73 % 15 bp Q2 revenue increase
Slide 12: Corporate
Corporate Q2 and YTD Fiscal 2025 Results Results Q2 YoY YTD Q2 YoY ($ in millions) FY 25 Change FY 25 Change Corporate Revenues $ 3 —% $ 3 —% Adjusted Corporate Expenses $ (172) 8% $ (207) (33) % Q2 Adjusted Corporate Expenses increase driven by pre-tax losses of $15 million associated with McKesson
Slide 13: Consistent cash flow + capital allocation driving shareholder value
Consistent cash flow + capital allocation driving shareholder value ($ in millions) $2,100 $(218) $(80) $(1,492) $(103) $2,509 $2,302 Q1 Cash1, Operating Cash Flow Capital Expenditures Dividends Share Repurchases Other2 Q2 Cash1, 6/30/24 9/30/24 See endnotes for details 13 © 2024 McKesson Corporatio
Slide 14: Fiscal 2025 Outlook
Fiscal 2025 Outlook On the following slides, McKesson presents an overview of its fiscal 2025 Outlook and assumptions. The company does not provide forward-looking guidance on a GAAP basis as McKesson is unable to provide a quantitative reconciliation of forward- looking Non-GAAP measures to the mos
Slide 15: Raising Fiscal 2025 Adjusted EPS outlook
Raising Fiscal 2025 Adjusted EPS outlook $32.40 to $33.00 Strong Business Performance Capital Deployment Fiscal 2025 Adjusted Operating Profit growth of 13% to Raised the full year share repurchases target from 15% compared to the prior year approximately $2.8 billion to approximately $3.2 billion F
Slide 16: Fiscal 2025 Adjusted EPS outlook
Fiscal 2025 Adjusted EPS outlook $32.40 to $33.00 18-20% growth $27.44 FY24 Operating McKesson Ventures Other1 FY25 Outlook Performance Actual November 6, 2024 See endnotes for details 16 © 2024 McKesson Corporation. All rights reserved.
Slide 17: Fiscal 2025 adjusted outlook
Fiscal 2025 adjusted outlook Consolidated metrics Metric Fiscal 2025 Outlook Fiscal 2024 Actual Earnings per Diluted Share $32.40 to $33.00 $27.44 Previously $31.75 to $32.55 GAAP Revenues 15% to 17% growth 12% growth Previously 13% to 15% growth Operating Profit 13% to 15% growth 2% decline Previou
Slide 18: Fiscal 2025 adjusted outlook: Segment metrics
Fiscal 2025 adjusted outlook Segment metrics U.S. Pharmaceutical Prescription Technology Medical-Surgical International Solutions Solutions Revenue 16% to 19% growth 8% to 12% growth 1% to 5% growth 5% to 9% growth Previously 13% to 16% growth Previously 14% to 18% growth Previously 3% to 7% growth
Slide 19: Appendix
olecolonofecedeceth ae ee ose g bobs » «6 of e Appendix
Slide 20: Endnotes
Endnotes These notes refer to the financial metrics and/or defined terms presented on: Slide 3 – Accelerating the Enterprise 1. Long-Term Adjusted EPS Growth Target excludes gains or losses associated with McKesson Venture’s portfolio investments Slide 5 – Strategy and Execution Accelerating and Dri
Slide 21: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q2 Fiscal 2025 and Q2 Fiscal 2024 McKESSON CORPORATION Schedule 2 RECONCILIATION OF GAAP OPERATING RESULTS TO ADJUSTED RESULTS (NON-GAAP) (unaudited) (in millions) Three Months Ended September 30, Six Months Ended September 30, 2024 2023 Change 2024 2023 Change Net in
Slide 22: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q2 Fiscal 2025 and Q2 Fiscal 2024 McKESSON CORPORATION Schedule 2 RECONCILIATION OF GAAP OPERATING RESULTS TO ADJUSTED RESULTS (NON-GAAP) (Continued) (unaudited) (in millions, except per share amounts) Three Months Ended September 30, Six Months Ended September 30, 20
Slide 23: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q2 Fiscal 2025 and Q2 Fiscal 2024 McKESSON CORPORATION Schedule 2 RECONCILIATION OF GAAP OPERATING RESULTS TO ADJUSTED RESULTS (NON-GAAP) (Continued) (unaudited) (in millions) Three Months Ended September 30, Six Months Ended September 30, 2024 2023 Change 2024 2023 C
Slide 24: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q2 Fiscal 2025 and Q2 Fiscal 2024 McKESSON CORPORATION Schedule 2 RECONCILIATION OF GAAP OPERATING RESULTS TO ADJUSTED RESULTS (NON-GAAP) (Continued) (unaudited) (in millions) Three Months Ended September 30, Six Months Ended September 30, 2024 2023 Change 2024 2023 C
Slide 25: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q2 Fiscal 2025 and Q2 Fiscal 2024 McKESSON CORPORATION Schedule 2 RECONCILIATION OF GAAP OPERATING RESULTS TO ADJUSTED RESULTS (NON-GAAP) (Continued) (unaudited) (in millions, except per share amounts) (a) Certain computations may reflect rounding adjustments. Any per
Slide 26: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q2 Fiscal 2025 and Q2 Fiscal 2024 McKESSON CORPORATION Schedule 3 RECONCILIATION OF GAAP SEGMENT OPERATING RESULTS TO ADJUSTED RESULTS (NON-GAAP) (unaudited) (in millions) Three Months Ended September 30, 2024 2023 Change As reported As adjusted As reported As adjuste
Slide 27: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q2 Fiscal 2025 and Q2 Fiscal 2024 McKESSON CORPORATION Schedule 3 RECONCILIATION OF GAAP SEGMENT OPERATING RESULTS TO ADJUSTED RESULTS (NON-GAAP) (Continued) (unaudited) (in millions) Six Months Ended September 30, 2024 2023 Change As reported As adjusted As reported
Slide 28: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q2 Fiscal 2025 and Q2 Fiscal 2024 McKESSON CORPORATION Schedule 6 RECONCILIATION OF GAAP CASH FLOW TO FREE CASH FLOW (NON-GAAP) (unaudited) (in millions) Six Months Ended September 30, 2024 2023 Change GAAP CASH FLOW CATEGORIES Net cash provided by (used in) operating
Slide 29: Financial Statement Notes
Financial Statement Notes McKESSON CORPORATION 1 of 2 FINANCIAL STATEMENT NOTES (1) Transaction-related expenses and adjustments for the three and six months ended September 30, 2024 includes a net loss of $643 million (pre-tax and after- tax), to remeasure assets and liabilities held for sale to fa
Slide 30: Financial Statement Notes
Financial Statement Notes 2 of 2 FINANCIAL STATEMENT NOTES (continued) (5) Other adjustments, net for the six months ended September 30, 2024 includes a pre-tax charge of $43 million ($31 million after-tax) within U.S. Pharmaceutical related to a loss from one of the Company's investments in equity
Slide 31: Supplemental Non-GAAP Financial Information
Supplemental Non-GAAP Financial Information McKESSON CORPORATION 1 of 3 SUPPLEMENTAL NON-GAAP FINANCIAL INFORMATION In an effort to provide investors with additional information regarding the Company's financial results as determined by generally accepted accounting principles ("GAAP"), McKesson Cor
Slide 32: Supplemental Non-GAAP Financial Information
Supplemental Non-GAAP Financial Information SUPPLEMENTAL NON-GAAP FINANCIAL INFORMATION (continued) 2 of 3 • Adjusted Segment Operating Profit (Non-GAAP) and Adjusted Segment Operating Profit Margin (Non-GAAP): We define Adjusted Segment Operating Profit as GAAP segment operating profit, excluding a
Slide 33: Supplemental Non-GAAP Financial Information
Supplemental Non-GAAP Financial Information SUPPLEMENTAL NON-GAAP FINANCIAL INFORMATION (continued) 3 of 3 Other adjustments - The Company evaluates the nature and significance of transactions qualitatively and quantitatively on an individual basis and may include them in the determination of our ad