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McKesson Reports Fiscal 2022 Fourth Quarter

McKesson Reports Fiscal 2022 Fourth Quarter

Highlights. Revenue: Mckesson Chttps://en.wikipedia.org/wiki/McKesson_Corporationorporation’s revenue jumped 11.77% since last year same period to $66102Mn in the Q1 2022.

Revenue $66102Mn
Net Profits $368Mn
Net Profit Margins 0.56%

McKesson Reports Fiscal 2022

Highlights
Revenue:Mckesson Corporation’s revenue jumped 11.77% since last year same period to $66102Mn in the Q1 2022. On a quarterly growth basis, Mckesson Corporation has generated -3.66% fall in its revenue since last 3-months.

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Net Profits:Mckesson Corporation’s net profit fell -44.74% since last year same period to $368Mn in the Q1 2022. On a quarterly growth basis, Mckesson Corporation has generated 5357.14% jump in its net profits since last 3-months.
Net Profit Margins:Mckesson Corporation’s net profit margin fell -50.56% since last year same period to 0.56% in the Q1 2022. On a quarterly growth basis, Mckesson Corporation has generated 5556.92% jump in its net profit margins since last 3-months.

McKesson Reports Fiscal 2022

Earnings per share (EPS) Estimates
Earnings per share (EPS) estimates of the Mckesson Corporation post its latest quarter earnings
EPS Estimate Current Quarter 5.28
EPS Estimate Current Year 5.28

Highlights
Earnings per share (EPS) forecasts for the current quarter at McKesson Corporation are 5.28, down 12.58% from forecasts for the prior quarter.
Earnings Per Share (EPS) Estimate for the Current Year: The current year’s EPS predictions for McKesson Corporation are 5.28.

McKesson Reports Fiscal 2022

A key ratio
The Mckesson Corporation’s key ratios for its Q2 2022 results
Dividend per share (DPS) was 1.88, Return on Assets (ROA) was 0.03, and Return on Equity (ROE) was 0.14

Highlights
Return on Assets (ROA): The company’s profitability in relation to its total assets is shown by return on assets (ROA). This ratio reveals the company’s financial situation. The greater the company’s financial health, the higher the ROA. Any firm with a ROA between 5% and 20% is typically regarded as having a good ROA. ROA of 20% or more is typically regarded as exceptional. The return on assets (ROA) for Mckesson Corporation is 0.03.

Earnings Per Share (EPS): The Return On Equity ratio shows how well a business is able to convert equity money from investors into profits. ROE demonstrates how effectively equity money is used to manage the company. A return on equity of double digits is typically seen as positive. The return on equity (ROE) for Mckesson Corporation is 0.14.

Dividend Per Share (DPS): During the Q2 2022 results report, McKesson Corporation announced a 1.88 dividend per share.

Earnings Date Estimated EPS Reported EPS Surprise% 2022-2021 2020 2019 2018 2017 2016 2015 Earnings Calendar 6.04 5.83 -3.48%

Company Information
McKesson Corporation is a global leader in healthcare supply chain management solutions, retail pharmacy, community oncology and specialty care, and healthcare information solutions. McKesson partners with pharmaceutical manufacturers, providers, pharmacies, governments and other organizations in healthcare to help provide the right medicines, medical products and healthcare services to the right patients at the right time, safely and cost-effectively. United by our ICARE shared principles, its employees work every day to innovate and deliver opportunities that make our customers and partners more successful – all for the better health of patients. McKesson has been named a ‘Most Admired Company’ in the healthcare wholesaler category by FORTUNE, a ‘Best Place to Work’ by the Human Rights Campaign Foundation, and a top military-friendly company by Military Friendly.

McKesson Reports Fiscal 2022

Organization Mckesson Corporation CEO Brian Tyler 6555 State Highway 161, Irving, Texas, 75039 Personnel 67500 Sector Medical Distributors

Quarter Four Highlights:

$66.1 billion in total sales is a 12% increase.
$2.48 in diluted earnings from continuing operations per share declined by $1.67.
15% more adjusted earnings per diluted share were $5.83.
Absent certain adjustments, adjusted earnings per diluted share climbed by 21%.
Highlights throughout the entire year:

An 11% rise in total revenues to $264.0 billion.
From ongoing operations, earnings per diluted share grew by $35.52 to $7.26.
Adjusted Earnings per Diluted Share grew by 38% to $23.69 per share.
Absent certain adjustments, adjusted earnings per diluted share climbed by 31%.

Texas, Irving, May 5, 2022 – The fourth quarter and fiscal year results for McKesson Corporation (NYSE:MCK) ended March 31, 2022, were released today.

Fourth-Quarter and Full-Year Result Summary for Fiscal 2022

McKesson Reports Fiscal 2022

According to CEO Brian Tyler, “McKesson had good financial success in fiscal 2022.” “Our approach is bearing fruit as we transition into a diversified healthcare services organisation

The expansion of our strategic pillars, oncology and biopharma services, as well as the resilience of our main North American distribution operations, Mr. Tyler remarked, “are encouraging. “Our performance is a direct result of our team members’ constant dedication and tenacity in providing for the needs of our clients, patients, patients, communities, and shareholders. We are enthusiastic about the possibilities we have to improve healthcare outcomes for everyone in fiscal

Fourth-quarter revenues were $66.1 billion, an increase of 12% from a year ago, and full-year revenues were $264.0 billion, an increase of 11%, primarily driven by growth in the U.S. Pharmaceutical segment, due to increased volumes of specialty products, including higher volumes from retail national account customers, and market growth, partially offset by branded to generic conversions.

Fourth-quarter earnings per diluted share from continuing operations was $2.48 compared to $4.15 a year ago, a decrease of $1.67. Full-year earnings per diluted share from continuing operations was $7.26 compared to a loss per diluted share of ($28.26) a year ago, an increase of $35.52, due to a prior year pre-tax charge of $8.1 billion expense accrual related to the opioid litigation.

McKesson Reports Fiscal 2022

Fourth-quarter Adjusted Earnings per Diluted Share was $5.83 compared to $5.05 a year ago, an increase of 15%, driven by growth across the business and a lower share count. Full-year Adjusted Earnings per Diluted Share was $23.69 compared to $17.21 a year ago, an increase of 38%, driven by strong operating performance across the segments, the contribution from COVID-19 vaccine distribution, kitting, and storage programs with the U.S. government, and a lower share count.

For the full-year, McKesson returned $3.8 billion of cash to shareholders, which included $3.5 billion of common stock repurchases and $277 million of dividend payments. During the fiscal year, McKesson generated cash from operations of $4.4 billion, and invested $535 million in capital expenditures, resulting in Free Cash Flow of $3.9 billion.

Business Highlights

In fiscal 2022, McKesson announced a planned exit from the European market, exemplifying its commitment to streamline the business and prioritizing investments in areas that are central to the long-term growth strategy.
On July 7, 2021, McKesson announced an agreement to sell certain McKesson Europe businesses in France, Italy, Ireland, Portugal, Belgium, and Slovenia to the PHOENIX Group. The transaction is expected to close in the second half of fiscal 2023.
On November 1, 2021, McKesson announced an agreement to sell its UK businesses to AURELIUS. The transaction closed on April 6, 2022.

On November 30, 2021, McKesson announced an agreement to sell the remaining share of its German joint venture to Walgreens Boots Alliance. The transaction closed on January 31, 2022.
On December 20, 2021, McKesson announced an agreement to sell its Austrian business to Quadrifolia Management GmbH. The transaction closed on January 31, 2022.
Norway and Denmark remain the only countries that McKesson has not entered into agreements to sell.

McKesson Reports Fiscal 2022

McKesson continued to expand its differentiated Oncology and Biopharma ecosystems, further demonstrating the significant progress against its company priorities.
McKesson’s proprietary oncology-focused software suite has documented approximately 10 million patient visits in the last year, helping to advance cancer care within the Oncology ecosystem.
Within the Biopharma ecosystem, McKesson helped patients save more than $6 billion on brand and specialty medications.

McKesson played a leading role in the fight against COVID-19. Through March 31, 2022:
U.S. Pharmaceutical successfully shipped over 380 million COVID-19 vaccines to administration sites across the U.S. and in support of the U.S. government’s international donation mission.
Medical-Surgical Solutions assembled enough kits to support the administration of more than 1.2 billion doses of COVID-19 vaccines.

Medical-Surgical Solutions distributed more than 135 million COVID-19 tests to physicians’ offices and other alternate healthcare sites.

U.S. Pharmaceutical Segment
Fourth-Quarter

Revenues were $53.7 billion, an increase of 14%, driven by increased volume of specialty products, including higher volumes from retail national account customers, and market growth, partially offset by branded to generic conversions.
Segment Operating Profit was $693 million. Adjusted Segment Operating Profit was $780 million, a decrease of 4%, driven by lower demand of COVID-19 vaccine distribution, partially offset by growth in distribution of specialty products to providers and health systems. Excluding the impact of COVID-19 vaccine distribution, the U.S. Pharmaceutical segment delivered Adjusted Segment Operating Profit growth of 2%.

Revenues were $212.1 billion, an increase of 12%, driven by increased volumes of specialty products, including higher volumes from retail national account customers, and market growth, partially offset by branded to generic conversions.
Segment Operating Profit was $2.9 billion. Adjusted Segment Operating Profit was $2.9 billion, an increase of 8%, driven by growth in distribution of specialty products to providers and health systems and contribution from COVID-19 vaccine distribution.

Prescription Technology Solutions Segment
Fourth-Quarter

Revenues were $1.0 billion, an increase of 29%, driven by volume growth related to biopharma services, including third-party logistics services and increased technology service revenue, partially resulting from the growth of prescription volumes.
Segment Operating Profit was $139 million. Adjusted Segment Operating Profit was $162 million, an increase of 11%, driven by growth from access and adherence solutions.

Revenues were $3.9 billion, an increase of 34%, driven by volume growth related to biopharma services, including third-party logistics services and increased technology service revenue.
Segment Operating Profit was $500 million. Adjusted Segment Operating Profit was $590 million, an increase of 26%, driven by growth from access and adherence solutions.
Medical-Surgical Solutions Segment
Fourth-Quarter

Revenues were $2.9 billion, an increase of 6%, driven by growth and improvements in the primary care business.
Segment Operating Profit was $280 million. Adjusted Segment Operating Profit was $298 million, an increase of 55%, driven by prior year inventory charges on PPE and related products as well as growth and improvements in the primary care business.
Full-Year

Revenues were $11.6 billion, an increase of 15%, driven by growth and improvements in the primary care business and the contribution from kitting, storage, and distribution of ancillary supplies for the U.S. government’s COVID-19 vaccine program.
Segment Operating Profit was $959 million. Adjusted Segment Operating Profit was $1.2 billion, an increase of 50%, driven by growth and improvements in the primary care business, prior year inventory charges on PPE and related products, and the contribution from kitting, storage, and distribution of ancillary supplies for the U.S. government’s COVID-19 vaccine program, partially offset by increased labor expens

International Segment
Fourth-Quarter

Revenues were $8.5 billion. On an FX-Adjusted basis, revenues were $8.8 billion, an increase of 3%, driven by the sales to new customers in the Canadian business and year-over-year volume recovery from COVID-19, partially offset by the divestiture of McKesson’s Austrian business, which was closed during the fourth quarter of fiscal 2022.
Segment Operating Loss was $207 million. On an FX-Adjusted basis, Adjusted Segment Operating Profit was $152 million, an increase of 10%, driven by the reduction of depreciation and amortization on European assets under agreements to sell and increased volumes in the pharmaceutical distribution business, including COVID-19 vaccines, tests, and PPE.

Revenues were $36.3 billion. On an FX-Adjusted basis, revenues were $35.4 billion, a decrease of 2%, driven by the contribution of McKesson’s German pharmaceutical wholesale business to a joint venture with Walgreens Boots Alliance, partially offset by year-over-year volume recovery from COVID-19 and sales to new customers in the Canadian business.
Segment Operating Loss was $968 million. On an FX-Adjusted basis, Adjusted Segment Operating Profit was $681 million, an increase of 40%, driven by increased volumes in the pharmaceutical distribution business, including COVID-19 vaccines, tests, and PPE, and the reduction of depreciation and amortization on European assets under agreements to sell.

Corporate Responsibility Updates

On February 25, 2022, McKesson announced the approval of the proposed opioid settlement agreement with 46 of 49 eligible states, as well as the District of Columbia and all eligible territories.

McKesson accomplished a significant refresh of the Board of Directors in fiscal 2022:
McKesson completed a smooth transition as Donald R. Knauss became independent chair of McKesson’s Board of Directors on April 1, 2022.

W. Roy Dunbar joined McKesson’s Board of Directors as a new director and member of the Audit and Governance Committees effective April 1, 2022.
James H. Hinton joined McKesson’s Board of Directors as a new director and member of the Compliance and Governance Committees effective January 13, 2022.

Kathleen Wilson-Thompson joined McKesson’s Board of Directors as a new director and member of the Compensation and Governance Committees effective January 13, 2022.
Dr. Richard H. Carmona joined McKesson’s Board of Directors as an independent director and member of the Compensation and Compliance Committees effective September 6, 2021

McKesson received multiple awards and acknowledgements for its diversity, equity, and inclusion achievements. McKesson continues to build a diverse workplace by expanding representation of women and people of color in leadership roles

McKesson Reports Fiscal 2022

McKesson submitted science-based targets to the Science Based Targets initiative (SBTi) for official validation in fourth quarter fiscal 2022. McKesson remains committed to establishing science-based greenhouse gas emissions reduction targets that are intended to meet SBTi’s standards.

Fiscal 2023 Outlook
McKesson continues its focused execution on company priorities including its planned exit from the European market. For fiscal 2023, McKesson expects Adjusted Earnings per Diluted Share of $22.90 to $23.60 to reflect continued operating momentum and a balanced approach to capital deployment.

Fiscal 2023 Adjusted Earnings per Diluted Share guidance includes approximately $0.20 to $0.60 of impacts attributable to the following:

$0.05 to $0.25 related to the U.S. government’s COVID-19 vaccine distribution, kitting, and storage programs; and $0.15 to $0.35 related to COVID-19 tests.

Fiscal 2023 Adjusted Earnings per Diluted Share guidance excluding the impacts of the above items from both fiscal 2023 guidance and fiscal 2022 results and $0.47 related to net gains associated with McKesson Ventures’ equity investments in fiscal 2022, indicates 9% to 14% forecasted growth compared to prior year.

Additional modeling considerations will be provided in the earnings call presentation.

Conference Call Details
McKesson has scheduled a conference call for today, Thursday, May 5th at 4:30 PM ET to discuss the company’s financial results. The audio webcast of the conference call will be available live and archived on McKesson’s Investor Relations website at investor.mckesson.com.

Upcoming Investor Events
McKesson management will be participating in the following investor conference:

Bank of America Healthcare Conference, May 12, 2022
Audio webcast, and a complete listing of upcoming events for the investment community, including details and updates, will be available on McKesson’s Investor Relations website.

Non-GAAP Financial Measures
GAAP refers to the U.S. generally accepted accounting principles. This press release includes GAAP financial measures as well as Non-GAAP financial measures, including Adjusted Gross Profit, Adjusted Operating Expenses, Adjusted Other Income, Adjusted Loss on Debt Extinguishment, Adjusted Income Tax Expense, Adjusted Earnings, Adjusted Earnings per Diluted Share, Adjusted Segment Operating Profit, Adjusted Segment Operating Profit Margin, Adjusted Corporate Expenses, Adjusted Operating Profit, FX-Adjusted results and Free Cash Flow which are financial measures not calculated in accordance with GAAP. Refer to the “Supplemental Non-GAAP Financial Information” section of the accompanying financial statement tables for the definitions and usefulness of the Company’s Non-GAAP financial measures and the attached schedules for reconciliations of the differences between the Non-GAAP financial measures and their most directly comparable GAAP financial measures.

The Company does not provide forward-looking guidance on a GAAP basis as McKesson is unable to provide a quantitative reconciliation of this forward-looking Non-GAAP measure to the most directly comparable forward-looking GAAP measure, without unreasonable effort, because McKesson cannot reliably forecast LIFO inventory-related adjustments, certain litigation loss and gain contingencies, restructuring, impairment and related charges, and other adjustments, which are difficult to predict and estimate. These items are inherently uncertain and depend on various factors, many of which are beyond the company’s control, and as such, any associated estimate and its impact on GAAP performance could vary materially.

Cautionary Statements
This earnings release 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 “believes”, “expects”, “anticipates”, “may”, “will”, “should”, “seeks”, “approximately”, “intends”, “projects,” “plans”, “estimates” or the negative of these words or other comparable terminology. The discussion of financial outlook, trends, strategy, plans, assumptions, or intentions may also include forward-looking statements. Readers should not place undue reliance on forward-looking statements, such as financial performance forecasts, which speak only as of the date they are first made. Except to the extent required by law, we undertake no obligation to update or revise our forward-looking statements. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected, anticipated, or implied. Although it is not possible to predict or identify all such risks and uncertainties, we encourage investors to read the risk factors described in our most recent annual and periodic report filed with the Securities and Exchange Commission.

These risk factors include, but are not limited to: we experience costly and disruptive legal disputes and settlements, including regarding our role in distributing controlled substances such as opioids; we might experience losses not covered by insurance or indemnification; we might be adversely impacted by changes in tax legislation or challenges to our tax positions; we from time to time record significant charges from impairment to goodwill, intangibles, inventory and other assets or investments; we experience cybersecurity incidents and might experience significant computer system compromises or data breaches; we might experience significant problems with information systems or networks; we may be unsuccessful in achieving our strategic growth objectives; we might be harmed by large customer purchase reductions, payment defaults or contract non-renewal; our contracts with government entities involve future funding and compliance risks; we might be harmed by changes in our relationships or contracts with suppliers; we might be adversely impacted by delays or other difficulties with divestitures; our use of third party data is subject to limitations that could impede the growth of our data services business; we might be adversely impacted by healthcare reform such as changes in pricing and reimbursement models; we might be adversely impacted by changes or disruptions in product supply and we have experienced and may experience difficulties in sourcing products and changes in pricing due to the effects of the COVID-19 pandemic on supply chains; we might be adversely impacted as a result of our distribution of generic pharmaceuticals; we might be adversely impacted by inflation, an economic slowdown (including the effects we have experienced from the COVID-19 pandemic) or recession and by disruption in capital and credit markets that might impede our access to credit, increase our borrowing costs and impair the financial soundness of our customers and suppliers; we might be adversely impacted by fluctuations in foreign currency exchange rates; we might be adversely impacted by events outside of our control, such as widespread public health issues (including the effects we have experienced from the COVID-19 pandemic), natural disasters, political events and other catastrophic events; we may be adversely affected by global climate change or by legal, regulatory or market responses to such change; and we face uncertainties and risks related to COVID-19 vaccination mandates and to vaccination distribution and related ancillary supply kit programs.

About McKesson Corporation
McKesson Corporation is a diversified healthcare services leader dedicated to advancing health outcomes for patients everywhere. Our teams partner with biopharma companies, care providers, pharmacies, manufacturers, governments, and others to deliver insights, products and services to help make quality care more accessible and affordable. Learn more about how McKesson is impacting virtually every aspect of healthcare

  1. A $4.4 billion cash flow from operations and a $3.9 billion free cash flow.
    Fiscal Outlook for 2023:

The guidance range for adjusted earnings per diluted share for fiscal 2023 is $22.90 to $23.60.
The projection for adjusted earnings per diluted share for fiscal 2023 accounts for implications ranging from $0.20 to $0.60.

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