McKesson Corporation · NYSE:MCK
McKesson — J.P. Morgan Healthcare Conference 2014
26 slides from McKesson's conference presentation, Jan 13, 2014
Slide 1: McKesson: In Business for Better Health
McKesson: In Business for Better Health J.P. Morgan Healthcare Conference John Hammergren Chairman and Chief Executive Officer McKesson Corporation January 13, 2014
Slide 2: Forward-Looking Statements
Forward-Looking Statements Some of the information in this presentation is not historical in nature and may GAAP / Non-GAAP constitute forward-looking statements, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Reconciliation These state
Slide 3: McKesson At-a-Glance
McKesson At-a-Glance Driving Better Health for 180 years • Headquartered in San Francisco, CA Unless indicated otherwise, presentation reflects results as of FYE13. 3
Slide 4: McKesson Drives Sustained Value Creation
McKesson Drives Sustained Value Creation Attractive healthcare markets Experienced and tenured management • Public policy agenda supports greater access and improved efficiency team with a steady • Demographics drive long-term demand track record of delivering results Strong balance Well-positioned
Slide 5: Celesio Transaction Update
Celesio Transaction Update
Slide 6: Global Sourcing Excellence
Global Sourcing Excellence ENGLAND GERMANY CANADA POLAND IRELAND HUNGARY SPAIN SLOVENIA USA ITALY MALTA ISRAEL CHINA SOUTH KOREA BERMUDA INDIA TAIWAN BRITISH VIRGIN HONG ISLANDS KONG PHILIPPINES THAILAND MALAYSIA Europe India China ENGLAND GERMANY POLAND IRELAND HUNGARY SOUTH SPAIN KOREA SLOVENIA IT
Slide 7: NorthStar Delivers Global Value To U.S. Customers
NorthStar Delivers Global Value To U.S. Customers Raw McKesson Ingredients Materials Distribution Raw Materials Generics Pharmacy Manufacturer Manufacturer 7
Slide 8: A History of Consistent Long-Term Operating Margin Expansion
A History of Consistent Long-Term Operating Margin Expansion in Distribution Solutions… Q4 FY05 earnings release: Achieved full-year Achieved full-year Issued initial operating margin adjusted operating adjusted operating target of 150 – 200 bps margin of 194 bps margin of 208 bps FY05 FY07 FY10 FY1
Slide 9: And a Track Record of Steady Revenue Growth
And a Track Record of Steady Revenue Growth $ Billions $122 $122 $108 $112 $101 $106 $93 FY07 FY08 FY09 FY10 FY11 FY12 FY13 Revenues for fiscal years 2007 through 2013 from continuing operations. 9
Slide 10: Leveraged Top-line Results into Higher Adjusted EPS Growth
We Have Leveraged Strong Top-line Results into Higher Adjusted EPS Growth… FY14 Guidance $8.40 - $8.70 $6.28 $6.38 $4.65 $5.13 $4.23 $3.41 $2.81 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 Reflects non-GAAP information calculated on an Adjusted Earnings basis. Reconciliation to GAAP information for fisc
Slide 11: And Solid First Half Results In Fiscal 2014
… And Solid First Half Results In Fiscal 2014 (In Millions except Adjusted EPS) Six Months Ended September 30, 2013 2012 Chg Revenues Distribution Solutions $ 63,572 $ 58,986 8% Technology Solutions 1,590 1,468 8% $ 65,162 $ 60,454 8% Adjusted Operating Profit Distribution Solutions $ 1,527 $ 1,255
Slide 12: We've Steadily Increased Operating Cash Flow
We’ve Steadily Increased Operating Cash Flow 7 Year Moving Average $2.5 $2.0 OCF $ Billions $1.5 $1.0 $0.5 FY07 FY08* FY09 FY10 FY11 FY12 FY13 *FY08 excludes $962 million Securities Litigation payment. 12
Slide 13: Enabling Effective Capital Deployment
…Enabling Effective Capital Deployment $8.8B in Value-Creating FY07 – FY13 $ Billions Acquisitions from FY07 – FY13 $0.9 Dividends Internal Capital PSS World Medical $1.9B Spending • Expanding medical surgical reach and capabilities $2.6 Drug Trading - Katz $0.9B $8.8 • Solidifying market leadership
Slide 14: PSS World Medical Integration Update
PSS World Medical Integration Update Salesforce Engagement Synergies Leadership Integration 14
Slide 15: In Business for Better Health
In Business for Better Health 15
Slide 16: McKesson
MCKESSON
Slide 17: Appendix
MSKESSON Appendix BUSINESS CARE CONNECTIVITY )
Slide 18: Adjusted Earnings (Non-GAAP) Financial Information
Adjusted Earnings(Non-GAAP) Financial Information The Company believes the presentation of non‐GAAP measures such as Adjusted Earnings provides useful supplemental information to investors with regard to its core operating performance, as well as assists with the comparison of its past financial per
Slide 19: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) Reconciliation McKESSON CORPORATION RECONCILIATION OF GAAP OPERATING RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions, except per share amounts) Six Months Ended September 30, 2013 Amortizat
Slide 20: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) Reconciliation McKESSON CORPORATION RECONCILIATION OF GAAP OPERATING RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions, except per share amounts) Year Ended March 31, 2013 (a) Amortization Ac
Slide 21: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) Reconciliation McKESSON CORPORATION RECONCILIATION OF GAAP OPERATING RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions, except per share amounts) Year Ended March 31, 2011 (a) Amortization Ac
Slide 22: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) Reconciliation McKESSON CORPORATION RECONCILIATION OF GAAP OPERATING RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions, except per share amounts) Year Ended March 31, 2009 (a) Amortization Ac
Slide 23: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) Reconciliation McKESSON CORPORATION RECONCILIATION OF GAAP OPERATING RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions, except per share amounts) Year Ended March 31, 2007 (a) Amortization of
Slide 24: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) McKESSON CORPORATION Reconciliation RECONCILIATION OF GAAP SEGMENT FINANCIAL RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions) Six Months Ended September 30, 2013 Six Months Ended September
Slide 25: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) McKESSON CORPORATION Reconciliation RECONCILIATION OF GAAP SEGMENT FINANCIAL RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions) Year Ended March 31, 2012 (a) Year Ended March 31, 2011 (a) Yea
Slide 26: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) McKESSON CORPORATION Reconciliation RECONCILIATION OF GAAP SEGMENT FINANCIAL RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions) Year Ended March 31, 2009 (a) Year Ended March 31, 2008 (a) Yea