Cardinal Health, Inc. · NYSE:CAH
Cardinal Health — Investor Day (June 2023)
92 slides from Cardinal Health's investor day presentation, Jun 8, 2023
Slide 1: Moving healthcare forward
Moving healthcare forward Cardinal Health Investor Day June 8, 2023 © 2023 Cardinal Health. All Rights Reserved.
Slide 2: Welcome and overview
Welcome and overview Kevin Moran, VP, Investor Relations 2 © 2023 Cardinal Health. All Rights Reserved.
Slide 3: Forward-looking statements
• Cardinal Health Investor Day | Forward-looking statements Cautions Concerning Forward-Looking Statements This presentation contains forward-looking statements addressing expectations, prospects, estimates and other matters that are dependent upon future events or developments. These statements may
Slide 4: Overview of the day
• Cardinal Health Investor Day | Moving healthcare forward Overview of the day 9:00am Welcome and overview | Kevin Moran, VP, Investor Relations 9:05am Our focus | Jason Hollar, Chief Executive Officer 9:30am Pharmaceutical Segment: Growth and resiliency | Debbie Weitzman, Pharmaceutical Segment CEO
Slide 5: Our focus
Our focus Jason Hollar Chief Executive Officer 5 © 2023 Cardinal Health. All Rights Reserved.
Slide 6: Healthcare's crucial link
Our focus | Mission critical Healthcare’s crucial link ~90% 20K 5K+ ~4M 20+ product 40K 30 ~130 U.S. hospitals specialty sourcing/ patients served pharmaceutical PET nuclear served physician manufacturer in the home by categories as deliveries a day cyclotron pharmacies offices and partners across d
Slide 7: Strategic priorities
• Our focus | Strategic priorities Strategic priorities Ruthless prioritization, resilient core & relentless focus 1 2 3 Build upon the Execute Medical Relentless focus growth and Improvement Plan on shareholder resiliency of initiatives value creation Pharmaceutical Segment 7 © 2023 Cardinal Health
Slide 8: Taking action to maximize and sustain value at Cardinal Health
• Our focus | Value creation Taking action to maximize and sustain value at Cardinal Health Value creation initiatives to-date1 Strategy, Capital FY23 financial portfolio and Governance deployment performance operations Executed Returning over $2.0B Raised non-GAAP EPS Appointed four simplification
Slide 9: Company snapshot
• Our focus | Company overview Company snapshot Expecting Operating in Approximately $200B+ 30 46,500 in FY23 Revenue1 countries Employees worldwide Pharmaceutical Medical FY23 Revenue1: ~$189.5B FY23 Revenue1: ~$14.9B FY23 Segment Profit1: ~$2.0B FY23 Segment Profit1: ~$108M 1FY23 Revenue and Segme
Slide 10: Our executive leadership team
• Our focus | Executive leadership Our executive Jason Hollar Aaron Alt Michelle Greene Steve Mason leadership Chief Executive Officer Chief Financial Officer Chief Information Officer Chief Executive Officer, Medical Segment team Jessica L. Mayer Ola Snow Debbie Weitzman Chief Legal and Compliance
Slide 11: Enabling a more sustainable and equitable world
• Our focus | ESG Enabling a more sustainable and equitable world And a healthier future for our communities, customers and employees Our ESG priorities Diversity, Equity and Inclusion By 20301: Increase representation of women2 Human capital Supply chain Customers Climate Governance, management ste
Slide 12: How we are evolving: Strategy, portfolio and operations
• Our focus | Key updates How we are evolving Strategy, Capital Financial portfolio and deployment performance operations 12 © 2023 Cardinal Health. All Rights Reserved.
Slide 13: Business and portfolio review
Our focus | Strategy, portfolio and operations Business Strategy • Core strategic alignment • Synergies/dis-synergies and portfolio Operational review performance framework • Financial results • Long-term growth prospects Key considerations Value • Intrinsic value Key considerations • Capital market
Slide 14: Our focus
• Our focus | Strategy, portfolio and operations Our focus Cardinal Health 1 Continue path towards becoming a simplified and more focused company 2 Prioritize Specialty as key long-term enterprise growth driver and investment opportunity 3 Realize growth opportunities in both Pharmaceutical and Medi
Slide 15: Expanding in Specialty: Navista Network
• Our focus | Strategy, portfolio and operations Expanding in Specialty Prioritizing expansion in Specialty as key long-term growth driver and investment opportunity for the enterprise Attractive market with strong innovation pipeline; repositioned business for increased organizational focus Scaled
Slide 16: Investing in Nuclear & Precision Health Solutions
• Our focus | Strategy, portfolio and operations Investing in Nuclear & Precision Health Solutions After evaluating strategic alternatives, we’ve determined retaining and investing in the business will drive the most long-term value for shareholders On trend with future of precision medicine and syn
Slide 17: Accelerating Outcomes
• Our focus | Strategy, portfolio and operations Accelerating Outcomes™ Merging Outcomes™ business into Blackrock’s Transaction Data Systems – Cardinal Health retains minority stake and strategic commercial partnership with combined business Expands solutions to retail pharmacies Combines network an
Slide 18: Executing our Medical Improvement Plan
• Our focus | Strategy, portfolio and operations Executing our Medical Improvement Plan Updating timeline for $650M+ in segment profit to FY26 Strategic priorities Status 1 Mitigate inflation and global supply chain constraints Exit FY23 offsetting at least 50% of gross impact On target Exit FY24 of
Slide 19: Our work is ongoing
• Our focus | Strategy, portfolio and operations “Over the past nine months, Jason and his team have demonstrated an Our work impressive commitment to profitable growth, responsible capital allocation is ongoing and sustainable shareholder value creation. As investors will see today, Cardinal Health
Slide 20: How we are evolving: Capital deployment
• Our focus | Capital deployment How we are evolving Strategy, Capital Financial portfolio and deployment performance operations 20 © 2023 Cardinal Health. All Rights Reserved.
Slide 21: Disciplined capital allocation framework
Our focus | Capital deployment Disciplined capital allocation framework Focused on driving sustainable, profitable growth, robust cash flow generation and responsible capital deployment to maximize shareholder value Table stakes Opportunistic Investing back into the business Active, disciplined and
Slide 22: How we are evolving: Financial performance
• Our focus | Financial performance How we are evolving Strategy, Capital Financial portfolio and deployment performance operations 22 © 2023 Cardinal Health. All Rights Reserved.
Slide 23: Key financial updates
• Our focus | Financial performance Key financial updates We are providing updates with respect to FY23, FY24 and our long-term financial targets: Narrowed Provided Updated Medical Provided long-term FY23 guidance: preliminary Improvement financial targets: $5.65 to $5.80 FY24 guidance: Plan timelin
Slide 24: Overall takeaways
Our focus | Bringing it all together Overall takeaways • Crucial link between clinical and operational • Execution of Medical Improvement Plan aspects of U.S. healthcare ecosystem remains a critical priority • Becoming a simplified and more focused company • Strong balance sheet, robust cash flow ge
Slide 25: Growth and resiliency
Growth and resiliency Debbie Weitzman CEO, Pharmaceutical Segment 25 © 2023 Cardinal Health. All Rights Reserved.
Slide 26: Today's agenda
Pharmaceutical Segment | Growth and resiliency Building upon our 1 strong core foundation Today’s agenda Accelerating growth in 2 Specialty and Nuclear Growth and resiliency Bringing it all together: 3 delivering results 26 © 2023 Cardinal Health. All Rights Reserved.
Slide 27: Who we are today
Pharmaceutical Segment | Growth and resiliency Who we are today Key areas Distribution Sourcing and Nuclear & Precision (including Specialty) Manufacturer Services Health Solutions 27 © 2023 Cardinal Health. All Rights Reserved.
Slide 28: Key trends
Pharmaceutical Segment | Growth and resiliency Key trends Supporting our strategies and enabling our long-term growth Patient Pharmaceutical Lowering the Technology demographics innovation cost of care advancement s Increasing demand for Novel therapy types Scaled capabilities Deploying new pharmace
Slide 29: Resilient US pharmaceutical market
Pharmaceutical Segment | Growth and resiliency Resilient US pharmaceutical market 7% US Pharmaceutical Industry IQVIA, invoice prices1 10-yr CAGR ($ in billions) $664 $621 $568 $526 $503 $477 $443 $451 $424 $379 $333 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 FY23 Outlook Consistent growth; U
Slide 30: Strong and diverse customer base
Pharmaceutical Segment | Strong core foundation Strong and diverse customer base Continued resilient demand and above-market revenue growth nearly Pharmaceutical manufacturers 40K daily deliveries serving millions of patients Strong and diverse customer base Retail Retail chain Mail order Long-term
Slide 31: Recent growth momentum
Pharmaceutical Segment | Strong core foundation Recent growth momentum Improved business fundamentals and financial performance create solid foundation to build upon 11% 4% 3-yr CAGR 3-yr CAGR Pharma Segment revenue Pharma Segment profit ($ in billions) ($ in billions) $2.0 $189.5 $165.5 $137.5 $145
Slide 32: Strong generics program performance
Pharmaceutical Segment | Strong core foundation Strong 9-year partnership Leading scale generics program with CVS Health extended through June 2029 in U.S. generic purchasing performance Brand sales loss of exclusivity Anchored by the scale and expertise (IQVIA – Small molecule only)1 of Red Oak Sou
Slide 33: Building upon our strong core foundation
Pharmaceutical Segment | Growth and resiliency Building upon our strong core foundation Growth and Providing customer- focused solutions across classes of trade Unlocking operational efficiencies through investments in technology and automation resiliency Key priorities Accelerating growth in Specia
Slide 34: Providing customer-focused solutions
Pharmaceutical Segment | Strong core foundation Providing customer-focused solutions 1 Striving to deliver a flawless end-to-end customer experience 2 Strategic utilization of the breadth of our solutions 3 Helping our customers lower the cost of care while improving patient outcomes Customer experi
Slide 35: Accelerating Outcomes
Pharmaceutical Segment | Strong core foundation Accelerating Strategic combination Outcomes™ Merging Outcomes™ business into Blackrock’s Transaction Data Systems to expand offerings Providing customer-focused to retail pharmacies solutions for retail pharmacies Combination creates a broad, integrate
Slide 36: A clinically-integrated supply chain
Pharmaceutical Segment | Strong core foundation A clinically-integrated supply chain Providing customer-focused solutions for health systems Shortages Manufacturer Shortages Manufacturer Until now, the We’re Patient mix, pharmaceutical population reshaping changes, etc. supply chain has the supply P
Slide 37: Unlocking further operational efficiencies
Pharmaceutical Segment | Strong core foundation Supporting customers and manufacturer partners through our Unlocking scale and operational efficiency further Unlocking additional value operational from our technology investments while delivering a frictionless customer efficiencies experience throug
Slide 38: Consumer health hub
Pharmaceutical Segment | Strong core foundation Demand for consumer health products is rapidly growing Consumer health hub Investing to create new tech-driven central distribution hub by FY25 Providing customer- focused solutions To increase fill rates, drive efficiencies and free capacity to suppor
Slide 39: Accelerating growth in Specialty
Pharmaceutical Segment | Accelerating growth in Specialty Accelerating growth in Specialty Our Specialty business is >$30B in revenue, growing at a 14% CAGR over the last 3 years 14% 3-yr CAGR Specialty Revenue1 $32 Expanding downstream ($ in billions) $27 across key therapeutic areas $22 $23 Partne
Slide 40: Introducing the Navista Network
Pharmaceutical Segment | Accelerating growth in Specialty Introducing the ™ Navista Network Supporting and enabling community oncology practices to remain independent Services and capital funding Stability of practice Shared practice insights to enable practice growth economics and value through dat
Slide 41: Expanding scale and capabilities for rheumatologists
Pharmaceutical Segment | Accelerating growth in Specialty Expanding scale and capabilities for rheumatologists Business Practice Bendcare partnership is driving a differentiated support operations engagement model with physicians Patient Payor services support Rheumatology is a $20B market opportuni
Slide 42: Biosimilars focus
Pharmaceutical Segment | Accelerating growth in Specialty Biosimilars focus Expanding downstream across key therapeutic areas Brand sales loss of exclusivity (IQVIA – Biologics only)1 2018 - 2022 2023 2024 - 2026 (Annual Average) Outlook Outlook (Annual Average) 42 © 2023 Cardinal Health. All Rights
Slide 43: Partnering upstream with manufacturer services
Partnering upstream with manufacturer services Craig Cowman, EVP, Strategic Sourcing & Manufacturer Services 43 © 2023 Cardinal Health. All Rights Reserved.
Slide 44: Serving the full breadth of manufacturers' critical needs
Pharmaceutical Segment | Accelerating growth in Specialty Manufacturer Serving the full breadth of services ✓ Market access manufacturers’ critical needs and availability ✓ Improved cost Manufacturer needs ✓ Patient adherence and support Product research Clinical trials Product Product delivery, Lif
Slide 45: Growing our established platforms: 3PL
Pharmaceutical Segment | Accelerating growth in Specialty Growing our established 3-year revenue CAGR of platforms: 3PL >15% nearly doubling market1 Partnering upstream with manufacturer services 3rd Party logistics (3PL): Strong leadership The leader in Specialty 3PL services with superior customer
Slide 46: Growing our established platforms: Sonexus Access and Patient Support
Pharmaceutical Segment | Accelerating growth in Specialty Growing our established platforms: Sonexus™ Access and Patient Support Partnering upstream with manufacturer services Sonexus™ Hub: Leading capabilities Full-service access and patient hub services platform that removes obstacles to care Our
Slide 47: Building advanced capabilities in cell and gene therapy
Pharmaceutical Segment | Accelerating growth in Specialty Building advanced capabilities in cell and gene therapy: Advanced Therapy Solutions Partnering upstream with manufacturer services Advanced Therapy Solutions (ATS) Cell and gene therapies provide Market projected for exponential unique challe
Slide 48: Specialty growth cycle
Pharmaceutical Segment | Accelerating growth in Specialty Specialty growth cycle Linking our downstream and upstream strategies Manufacturer services Clinically-integrated provider network Manufacturers seeking to reach patients and their Providers participating providers in networks Unique patient
Slide 49: The future of precision medicine
Pharmaceutical Segment | Accelerating growth in Nuclear The future of precision medicine Supporting pharmaceutical innovation through our Center for Theranostics Advancement Financial outlook Capabilities Investments Center for Theranostics Announcing phase 2 ~$1B+ revenue Advancement already invest
Slide 50: Bringing it all together – delivering results
Pharmaceutical Segment | Bringing it all together Strong core foundation Specialty and Nuclear Providing customer- Expanding downstream focused solutions across key therapeutic areas across classes of trade Growth and Unlocking operational efficiencies Partnering upstream with manufacturer services
Slide 51: Medical Improvement Plan
Medical Improvement Plan Steve Mason, CEO, Medical Segment 51 © 2023 Cardinal Health. All Rights Reserved.
Slide 52: Today's agenda
Medical Segment | Medical Improvement Plan Who we are 1 and what we do Today’s agenda Medical Improvement 2 Plan progress Medical Improvement Plan Bringing it all together: 3 delivering results 52 © 2023 Cardinal Health. All Rights Reserved.
Slide 53: Providing the right product at the right place and time
• Medical Segment | Who we are and what we do Providing the right product at the right place and time So healthcare providers can focus on caring for their patients Integrated manufacturer Direct to patient Digital supply chain Manufacturing, sourcing, and distributing at-Home Solutions distributing
Slide 54: Leveraging our scale and global reach
• Medical Segment | Who we are and what we do Leveraging our scale and global reach To address healthcare’s most pressing challenges 1 Total revenue by product Total revenue by region 1 Direct to Patient, ~$1B ~$600M Digital Supply Chain, Canada Other2 Rest of the world $3.2B National Brand Cardinal
Slide 55: The journey to $650M+ in segment profit by FY26
• Medical Segment | Medical Improvement Plan The journey to $650M+ in segment profit by FY26 Original Target Updated Target Strategic priorities Areas of focus Status FY23-FY25 FY23-FY26 Fully offset with mitigation initiatives Mitigate inflation and global 1 • Exit FY23 offsetting at least 50% of g
Slide 56: On track to mitigate the impact of inflation
• Medical Segment | Inflation mitigation On track to mitigate the impact of inflation on our business • Expect observed improvements Improving net impact: mitigation actions and cost reductions in international freight to drive the overall cost improvement FY23 from Q2 FY23 peak exit rate 50%+ FY24
Slide 57: Optimizing and growing Cardinal Health Brand
Optimizing and growing Cardinal Health™ Brand Ben Brinker, President, Global Products & Supply Chain 57 © 2023 Cardinal Health. All Rights Reserved.
Slide 58: An integrated manufacturer with distribution
• Medical Segment | Optimizing and growing Cardinal Health™ Brand An integrated manufacturer with distribution Patients, caregivers and providers worldwide rely upon our products every day Global products Global operations Total Cardinal Health™ Brand Revenue1 U.S. 40 DCs (in billions $) Specialty p
Slide 59: Enabling the backbone and future of healthcare
• Medical Segment | Optimizing and growing Cardinal Health™ Brand Enabling the backbone and future of healthcare Core to Distribution Products (backbone of healthcare) Specialty Products (future of healthcare) Presource® Drapes & Gowns Incontinence Kangaroo™ Kendall™ Procedure Packs Enteral Feeding
Slide 60: Placing a renewed focus on new product development
• Medical Segment | Optimizing and growing Cardinal Health™ Brand Placing a renewed focus on new product development And innovation investments for Cardinal Health™ Brand Kangaroo OMNI™ Platform is the next generation enteral feeding platform with wireless connectivity potential that is designed to
Slide 61: Making deliberate investments
• Medical Segment | Optimizing and growing Cardinal Health™ Brand Making deliberate investments To create the right environment to grow our Cardinal Health™ Brand portfolio Distribution network Nutritional Delivery Fluid Management Protexis™ Surgical Gloves Incontinence Increasing space in our distr
Slide 62: A clear five-point plan to accelerate product growth
• Medical Segment | Optimizing and growing Cardinal Health™ Brand A clear five-point plan to accelerate product growth Observing improvements across key leading indicators 1 Customer experience 2 Portfolio and supply chain health 3 New product development and commercialization 4 Commercial structure
Slide 63: Our at-Home Solutions business continues to accelerate
• Medical Segment | Accelerating our growth businesses: direct to patient Our at-Home Solutions business continues to accelerate Through focused investments to meet growing demand Breadth and scale1 Direct to patient network Customer experience focused ~4M patients served in their homes in U.S. annu
Slide 64: Our OptiFreight Logistics business is driving strong growth
• Medical Segment | Accelerating our growth businesses: digital supply chain solutions Our OptiFreight® Logistics business is driving strong growth By delivering value and efficiencies for our customers Breadth and scale1 Digital supply chain solutions Customer digital platforms 20M+ Leading logisti
Slide 65: Strong track record of simplification and cost optimization
• Medical Segment | Simplification and cost optimization Strong track record of simplification and cost optimization Countries served with Active portfolio Manufacturing products management excellence 128 Classified categories to deploy Assessed make vs. buy decisions resources according to value an
Slide 66: Path to $650M+ by FY26
Medical Segment | Bringing it all together Mitigate inflation We are on track to fully offset inflation by the time we exit FY24 through our mitigation actions and observed improvements in international freight Path to Optimize and grow Cardinal Health™ Brand With focused commercial actions and inve
Slide 67: Value creation
Value creation Aaron Alt, CFO 67 © 2023 Cardinal Health. All Rights Reserved.
Slide 68: Updated launching point: Narrowing our FY23 guidance
Value creation | Updated FY23 guidance Updated launching point: Narrowing our FY23 guidance Cardinal Health non-GAAP EPS: Adjusted Free Cash Flow: $5.65 to $5.80 13% growth at mid-point $2.0 to $2.3B Previously $5.60 to $5.80 Pharmaceutical Medical Revenue: Segment Profit: Revenue: Segment Profit1:
Slide 69: Value creation framework
Value creation | Value creation framework Value creation Growth from strategic portfolio framework and customer positioning Improved operational performance CAH and strong execution SHAREHOLDER Operating leverage VALUE Sustainable profitable growth CREATION Working capital focus Robust cash flow gen
Slide 70: Preliminary Enterprise FY24 guidance
Value creation | Preliminary FY24 guidance EPS Growth non-GAAP diluted EPS: $6.45 to $6.70 +15% FY23: $5.65 to $5.80 Growth at the mid-points Cash Flow Preliminary Adjusted free cash flow and Capital Capital expenditures Enterprise ~$2B ~$500M FY24 guidance Other Assumptions Interest and other: non-
Slide 71: Pharma Segment FY24 guidance
Value creation | Pharma Segment FY24 guidance Revenue and segment profit Pharma Revenue growth of Segment profit growth of Segment ~10% 4% to 6% FY24 guidance Key Assumptions: • Anticipate contribution from manufacturer price increases to be in line with FY22 (do not anticipate repeat of modest FY23
Slide 72: Medical Segment FY24 guidance
Value creation | Medical Segment FY24 guidance Revenue and segment profit Medical Revenue growth of Segment profit of Segment ~3% ~$400M FY24 guidance Key Assumptions: • Increased contributions from Medical Improvement Plan initiatives • Exit FY24 fully mitigating gross impact of inflation • Year-ov
Slide 73: Our long-term targets: FY24-26
Value creation | Long-term targets Our long-term targets: FY24-26 (FY23 Baseline) 4% to 6% $650M+ at least 12% to 14% Growth CAGR in FY26 $2B Growth CAGR Pharma Medical Share non-GAAP diluted Segment Profit Segment Profit repurchases1 EPS growth 1Includes base share repurchases of $500M per year and
Slide 74: Pharma Segment long-term targets
Value creation| Long-term targets Pharma Segment Long-term targets FY24 – FY26 Segment profit CAGR of 4% to 6% Key assumptions ~10% revenue CAGR Low-single digit profit growth in core Pharmaceutical Distribution 2% to 3% market growth in generic units Double-digit profit growth in Specialty and Nucl
Slide 75: Medical Segment long-term targets
Value creation| Long-term targets Medical Segment Long-term targets FY26 Segment profit of $650M+ Key assumptions 3% to 4% revenue CAGR ~$50M contribution from 2% to 3% Cardinal Health™ Brand revenue CAGR1 Low-single digit market growth for medical surgical consumable $75M+ contribution from growth
Slide 76: Robust cash flow generation
Value creation| Robust cash flow generation Robust cash flow generation Adjusted free cash flow Anticipate generating ~$6B+ ($ in billions) in total adjusted free cash flow over the next 3 years $2.3B $2.0B to $2.3B + ~$2B of available opportunistic $1.9B ~$2.0B cash currently on balance sheet = ~$8
Slide 77: Disciplined Capital Allocation Framework
Value creation| Capital allocation framework Table stakes Investing back into the business to drive organic growth Maintain investment grade balance sheet Disciplined Capital Baseline return of capital to shareholders ▪ Continue to grow the dividend Allocation Framework ▪ Base share repurchases FY24
Slide 78: Driving organic growth
Value creation | Investing back into the business Driving organic growth Investing to support our Strong focus on return on customers’ needs while building invested capital to drive upon our technology capabilities sustainable, profitable growth Capital expenditures ($ in millions) ~$500 ~$450 $400
Slide 79: Focus: Maintaining investment grade balance sheet
Value creation | Investment grade balance sheet Focus: Maintaining investment grade balance sheet And our current BBB/Baa2 credit ratings Outstanding notes Moody’s CAH Debt/EBITDA Current Ratings: ($ inBBB millions)/ Baa2 as of March 20231 3.2x 1,346 2.5x - 3.0x 750 500 566 400 344 350 445 FY24 FY25
Slide 80: Dividend aristocrat: increased dividend each year for 30+ years
Value creation | Returning capital to shareholders Dividend aristocrat: We’ve increased our dividend each year for 30+ years Dividend yield comparison1 CAH dividend per share ~2.4% ~1.8% ~1.7% ~1.1% ~0.6% CAH S&P 500 S&P 500 Competitor 1 Competitor 2 1993 2003 2013 2023 Healthcare Index Committed to
Slide 81: Baseline return of capital to shareholders
Shareholder value creation| Returning capital to shareholders Baseline return of At a minimum, returning ~$1B to shareholders capital to shareholders each year dividend + base share repurchases Growing our dividend: Base share repurchases: + 1% dividend increase announced May 11, 2023 Minimum ~$500M
Slide 82: Active, disciplined and targeted M&A
Value creation | M&A framework M&A framework Active Always evaluating potential M&A Disciplined Active, disciplined M&A must exceed internal hurdle rates and targeted M&A Opportunistic with timing and magnitude Prioritizing expansion of Specialty Targeted for any potential M&A View M&A as opportunit
Slide 83: Opportunistic share repurchases
Value creation | Opportunistic share repurchases 293 12% reduction in diluted share Opportunistic over last ~2 years share repurchases Q4 FY21 258 Q3 FY23 New share repurchase authorization: Share repurchases framework $3.5B expiring December 31, 2027 ~$500M of annual base share repurchases + additi
Slide 84: Robust cash flow generation + disciplined capital deployment
Value creation | Cash flow and capital allocation framework Robust cash flow generation + disciplined capital deployment ~$1.5B Dividend FY24-FY26 Baseline Remaining ~$3.0B+ return of opportunistic ~$8B+ capital deployment FY24-FY26 ~$3.0B total adjusted FCF + Opportunistic levers current balance sh
Slide 85: Compelling investment thesis
Cardinal Health Investor Day | Shareholder value creation Compelling investment thesis Moving healthcare forward Pharma Medical Cash flow Capital deployment Value creation Resilient and growing business, Executing our plan to Expect continued = Disciplined M&A and Relentlessly focused supported by k
Slide 86: Strategic priorities
• Cardinal Health Investor Day | Our focus Strategic priorities Ruthless prioritization, resilient core & relentless focus 1 2 3 Build upon the Execute Medical Relentless focus growth and Improvement Plan on shareholder resiliency of initiatives value creation Pharmaceutical Segment 86 © 2023 Cardin
Slide 87: Appendix
Appendix 87 © 2023 Cardinal Health. All Rights Reserved.
Slide 88: GAAP / Non-GAAP Reconciliation
Cardinal Health, Inc. and Subsidiaries 1 GAAP / Non-GAAP Reconciliation Earnings/ Gross Operating (Loss) Provision for/ Net Diluted 2 3 3 Margin SG&A Operating Earnings Before (Benefit from) Net Earnings Effective EPS Gross Growth Growth Earnings/ Growth Income Income Earnings/ Growth Tax Diluted Gr
Slide 89: GAAP Cash Flow to Non-GAAP Adjusted Free Cash Flow
Cardinal Health, Inc. and Subsidiaries GAAP / Non-GAAP Reconciliation - GAAP Cash Flow to Non-GAAP Adjusted Free Cash Flow Fiscal Year Fiscal Year (in millions) 2022 2021 GAAP - Cash Flow Categories Net cash provided by operating activities $ 3,122 $ 2,429 Net cash provided by/(used in) investing ac
Slide 90: Forward Looking non-GAAP Measures
Cardinal Health, Inc. and Subsidiaries Forward Looking non-GAAP Measures In this document, the Company presents certain forward-looking non-GAAP metrics. The Company does not provide outlook on a GAAP basis because the items that the Company excludes from GAAP to calculate the comparable non-GAAP me
Slide 91: Definitions
Cardinal Health, Inc. and Subsidiaries Definitions Growth rate calculation: growth rates are determined by dividing the difference between current-period results and prior-period results by prior-period results. Interest and Other, net: other (income)/expense, net plus interest expense, net. Segment
Slide 92: Definitions Continued
Cardinal Health, I nc. and Subsidiaries Definitions Continued 1 LIFO charges and credits are excluded because the factors that drive last-in first-out ("LIFO") inventory charges or credits, such as pharmaceutical manufacturer price appreciation or deflation and year-end inventory levels (which can b