Cardinal Health, Inc. · NYSE:CAH
Cardinal Health — Q4 FY2019 Earnings Presentation
21 slides from Cardinal Health's earnings presentation, Aug 8, 2019
Slide 1: Q4 FY19 Cardinal Health, Inc. Earnings Call
Q4 FY19 CARDINAL HEALTH, INC. EARNINGS CALL AUGUST 8, 2019 1
Slide 2: Forward-looking statements and GAAP reconciliation
Forward-looking statements and GAAP reconciliation 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 be ident
Slide 3: Q4 results
Q4 results 3
Slide 4: Q4 FY19 financial summary
Q4 FY19 financial summary GAAP Basis ($M) Non-GAAP Basis ($M) Q4 FY19 Q4 FY19 Revenue $37,353 N/A % change 6% Gross Margin $1,674 N/A % change (4)% SG&A $1,168 N/A % change (8)% Operating Earnings $307 $507 % change N.M. 9% Interest & Other1 $69 N/A % change (35)% Net Earnings2 $194 $334 % change N.
Slide 5: Q4 FY19 Pharmaceutical segment results
Q4 FY19 Pharmaceutical segment results Q4 FY19 ($M) Q4 FY18 ($M) YoY change Revenue $33,401 $31,455 6% Segment profit $447 $416 7% Segment profit margin 1.34% 1.32% +2 bps Drivers: Revenue + Pharmaceutical Distribution and Specialty Solutions customers Segment profit + Specialty Solutions + Brand sa
Slide 6: Q4 FY19 Medical segment results
Q4 FY19 Medical segment results Q4 FY19 ($M) Q4 FY18 ($M) YoY change Revenue $3,956 $3,898 1% Segment profit $97 $114 (15)% Segment profit margin 2.45% 2.92% -47 bps Drivers: Revenue + Existing customers - Divestiture of the naviHealth business Segment profit - Cardinal Health Brand products + Cost
Slide 7: FY19 results
FY19 results 7
Slide 8: FY19 highlights
FY19 highlights ▪ Exceeded non-GAAP EPS guidance for the year ▪ Delivered double digit revenue and profit growth in strategic Operating growth areas – Specialty, At Home, and Medical Services Performance ▪ Realized cost savings of $133M, which exceeded our target ▪ Renewed contracts with CVS and Kro
Slide 9: FY19 financial summary
FY19 financial summary GAAP Basis ($M) Non-GAAP Basis ($M) FY19 FY19 Revenue $145,534 N/A % change 6% Gross Margin $6,834 N/A % change (5)% SG&A $4,480 N/A % change (3)% Operating Earnings $2,060 $2,353 % change N.M. (9)% Interest & Other1 $309 N/A % change (12)% Net Earnings2 $1,363 $1,589 % change
Slide 10: FY19 Pharmaceutical segment results
FY19 Pharmaceutical segment results FY19 ($M) FY18 ($M) YoY change Revenue $129,917 $121,241 7% Segment profit $1,834 $1,992 (8)% Segment profit margin 1.41% 1.64% -23 bps Drivers: Revenue + Pharmaceutical Distribution and Specialty Solutions customers - Divestiture of the company’s China distributi
Slide 11: FY19 Medical segment results
FY19 Medical segment results FY19 ($M) FY18 ($M) YoY change Revenue $15,633 $15,581 0% Segment profit $576 $662 (13)% Segment profit margin 3.68% 4.25% -57 bps Drivers: Revenue + Existing customers - Net impact of acquisitions and divestitures Segment profit - Cardinal Health Brand products + Cost s
Slide 12: FY20 outlook
FY20 outlook 12
Slide 13: FY20 financial expectations
FY20 financial expectations FY20 outlook FY19 actual Non-GAAP EPS $4.85 - $5.10 $5.28 Interest and other $295M - $315M $309M Non-GAAP ETR 24.0% - 26.0% 22.1% Diluted weighted average 292M - 297M 301M shares outstanding Incremental cost savings >$130M $133M Capital expenditures $320M - $360M $328M 13
Slide 14: FY20 segment outlook
FY20 segment outlook Segment Revenue Profit Mid-single digit High-single to low-double Pharmaceutical percentage growth digit percentage decline Low-single digit Low-double digit Medical percentage growth percentage growth 14 © 2019 Cardinal Health. All Rights Reserved.
Slide 15: Q4 FY19 trailing five quarters
Q4 FY19 trailing five quarters GAAP TO NON-GAAP RECONCILIATION STATEMENTS AND SUPPLEMENTAL FINANCIAL INFORMATION 15
Slide 16: Q4 FY19 trailing five quarters segment analysis
Q4 FY19 trailing five quarters segment analysis Pharmaceutical segment Q4 FY18 Q1 FY19 Q2 FY19 Q3 FY19 Q4 FY19 Revenue 31,455 31,416 33,740 31,361 33,401 ($M) Segment Profit ($M) 416 409 443 536 447 Medical segment Q4 FY18 Q1 FY19 Q2 FY19 Q3 FY19 Q4 FY19 Revenue 3,898 3,801 4,006 3,871 3,956 ($M) Se
Slide 17: GAAP / Non-GAAP Reconciliation
Cardinal Health, Inc. and Subsidiaries 1 GAAP / Non-GAAP Reconciliation Gross Operating Earnings Margin Earnings Before Provision for Net Effective Diluted Gross Growth Operating Growth Income Income Net Earnings2 Tax Diluted EPS2,3,4 Margin Rate Earnings Rate Taxes Taxes 2 Growth Rate Rate 2,3,4 Gr
Slide 18: GAAP / Non-GAAP Reconciliation
Cardinal Health, Inc. and Subsidiaries GAAP / Non-GAAP Reconciliation1 Gross Operating Earnings Provision for/ Margin Earnings Before (Benefit From) Net Effective Diluted 2 2,3,4 Gross Growth Operating Growth Income Income Net Earnings Tax Diluted EPS 2 2,3,4 Margin Rate Earnings Rate Taxes Taxes Ea
Slide 19: Segment Information
Cardinal Health, Inc. and Subsidiaries Segment Information Fourth Quarter (in millions) 2019 2018 (in millions) 2019 2018 Pharmaceutical Medical Revenue Revenue Amount $ 33,401 $ 31,455 Amount $ 3,956 $ 3,898 Growth rate 6% 6% Growth rate 1% 14 % Segment profit Segment profit Amount $ 447 $ 416 Amou
Slide 20: 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 changes in the items that the Company excludes from GAAP to calculate the comparable
Slide 21: Definitions
Cardinal Health, Inc. and Subsidiaries Definitions Interest and Other, net: other (income)/expense, net plus interest expense, net. Non-GAAP diluted EPS attributable to Cardinal Health, Inc.: non-GAAP net earnings attributable to Cardinal Health, Inc. divided by diluted weighted-average shares outst