Cardinal Health Reports Second-quarter Results for Fiscal Year 2018
"Overall, we are very pleased with the quarter," said
"As we look to the remainder of the year," Kaufmann continued, "we anticipate our overall operating performance to be as expected."
Q2 FY18 summary
Q2 FY18 |
Q2 FY17 |
Y/Y |
|
Revenue |
|
|
6% |
Operating earnings |
|
|
(26)% |
Non-GAAP operating |
|
|
4% |
Net earnings attributable to |
|
|
225% |
Non-GAAP net earnings |
|
|
12% |
Diluted EPS attributable to |
|
|
226%
|
Non-GAAP diluted EPS |
|
|
13% |
The enactment of the
Second, as part of
Fiscal year 2018 outlook
The company does not provide GAAP EPS outlook because it is unable to reliably forecast most of the items that are excluded from GAAP EPS to calculate non-GAAP EPS. These items could cause EPS to differ materially from non-GAAP EPS. See "Use of Non-GAAP Measures" following the attached schedules for additional explanation.
The company is raising its outlook for fiscal 2018 non-GAAP EPS to
Segment results
Pharmaceutical segment
Second-quarter revenue for the Pharmaceutical segment increased 5 percent to
Segment profit for the quarter decreased 4 percent to
Q2 FY18 |
Q2 FY17 |
Y/Y |
|
Revenue |
|
|
5% |
Segment profit |
|
|
(4)% |
Medical segment
Second-quarter revenue for the Medical segment increased 19 percent to
Segment profit increased 38 percent to
Q2 FY18 |
Q2 FY17 |
Y/Y |
|
Revenue |
|
|
19% |
Segment profit |
|
|
38% |
Additional second-quarter and recent highlights
- The
Cardinal Health board of directors approved a new authorization to repurchase up to$1 billion ofCardinal Health common shares, which will expire onDec. 31, 2020 . With this new authorization,Cardinal Health is now authorized to repurchase up to$1.3 billion of its common shares. - The company closed its divestiture of its Cardinal Health China distribution business on
Feb. 1 with net proceeds of approximately$800 million . - Cordis and Medinol announced
U.S. Food and Drug Administration approval of the EluNIR™ drug-eluting stent for the treatment of patients with narrowing or blockages to their coronary arteries. The companies also announced treatment of the first patients inthe United States with the device following its approval. - The company launched the Opioid Action Program, aimed at helping communities in four of the nation's hardest-hit states combat the opioid epidemic. The pilot program will deliver much needed front-line assistance to help prevent opioid abuse and support first responders in
Ohio ,Kentucky ,Tennessee andWest Virginia .
Webcast
Presentation slides and a webcast replay will be available on the
Upcoming webcasted investor events
Leerink Partners 7th Annual Global Healthcare Conference onFeb. 15 at9 a.m. inNew York City - 2018
RBC Capital Markets Global Healthcare Conference onFeb. 21 at8:30 a.m. inNew York City Cowen 38th AnnualHealth Care Conference onMarch 12 at11:20 a.m. inBoston Barclays Global Healthcare Conference onMarch 13 at9 a.m. inMiami
About
1GAAP refers to
Cautions Concerning Forward-Looking Statements
This news release contains forward-looking statements addressing expectations, prospects, estimates and other matters that are dependent upon future events or developments. These statements may be identified by words such as "expect," "anticipate," "intend," "plan," "believe," "will," "should," "could," "would," "project," "continue," "likely," and similar expressions, and include statements reflecting future results or guidance, statements of outlook and expense accruals. These matters are subject to risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. These risks and uncertainties include competitive pressures in
Schedule 1 |
||||||||||
Condensed Consolidated Statements of Earnings (Unaudited) |
||||||||||
Second Quarter |
||||||||||
(in millions, except per common share amounts) |
2018 |
2017 |
% Change |
|||||||
Revenue |
$ |
35,186 |
$ |
33,150 |
6 |
% |
||||
Cost of products sold |
33,325 |
31,548 |
6 |
% |
||||||
Gross margin |
1,861 |
1,602 |
16 |
% |
||||||
Operating expenses: |
||||||||||
Distribution, selling, general and administrative expenses |
1,131 |
910 |
24 |
% |
||||||
Restructuring and employee severance |
21 |
7 |
N.M. |
|||||||
Amortization and other acquisition-related costs |
184 |
115 |
N.M. |
|||||||
Impairments and (gain)/loss on disposal of assets, net |
68 |
9 |
N.M. |
|||||||
Litigation (recoveries)/charges, net |
58 |
19 |
N.M. |
|||||||
Operating earnings |
399 |
542 |
(26) |
% |
||||||
Other (income)/expense, net |
(5) |
7 |
N.M. |
|||||||
Interest expense, net |
87 |
44 |
96 |
% |
||||||
Earnings before income taxes |
317 |
491 |
(35) |
% |
||||||
Provision for/(benefit from) income taxes |
(736) |
167 |
(541) |
% |
||||||
Net earnings |
1,053 |
324 |
225 |
% |
||||||
Less: Net earnings attributable to noncontrolling interests |
— |
— |
N.M. |
|||||||
Net earnings attributable to |
$ |
1,053 |
$ |
324 |
225 |
% |
||||
Earnings per common share attributable to |
||||||||||
Basic |
$ |
3.35 |
$ |
1.02 |
228 |
% |
||||
Diluted |
3.33 |
1.02 |
226 |
% |
||||||
Weighted-average number of common shares outstanding: |
||||||||||
Basic |
315 |
318 |
||||||||
Diluted |
316 |
319 |
Schedule 2 |
||||||||||
Condensed Consolidated Statements of Earnings (Unaudited) |
||||||||||
Year-to-Date |
||||||||||
(in millions, except per common share amounts) |
2018 |
2017 |
% Change |
|||||||
Revenue |
$ |
67,827 |
$ |
65,189 |
4 |
% |
||||
Cost of products sold |
64,294 |
61,997 |
4 |
% |
||||||
Gross margin |
3,533 |
3,192 |
11 |
% |
||||||
Operating expenses: |
||||||||||
Distribution, selling, general and administrative expenses |
2,193 |
1,831 |
20 |
% |
||||||
Restructuring and employee severance |
153 |
16 |
N.M. |
|||||||
Amortization and other acquisition-related costs |
368 |
237 |
N.M. |
|||||||
Impairments and (gain)/loss on disposal of assets, net |
68 |
12 |
N.M. |
|||||||
Litigation (recoveries)/charges, net |
90 |
20 |
N.M. |
|||||||
Operating earnings |
661 |
1,076 |
(39) |
% |
||||||
Other (income)/expense, net |
(4) |
3 |
N.M. |
|||||||
Interest expense, net |
168 |
88 |
91 |
% |
||||||
Loss on extinguishment of debt |
2 |
— |
N.M. |
|||||||
Earnings before income taxes |
495 |
985 |
(50) |
% |
||||||
Provision for/(benefit from) income taxes |
(675) |
351 |
(292) |
% |
||||||
Net earnings |
1,170 |
634 |
85 |
% |
||||||
Less: Net earnings attributable to noncontrolling interest |
(2) |
(1) |
N.M. |
|||||||
Net earnings attributable to |
$ |
1,168 |
$ |
633 |
85 |
% |
||||
Earnings per common share attributable to |
||||||||||
Basic |
$ |
3.70 |
$ |
1.99 |
86 |
% |
||||
Diluted |
3.68 |
1.97 |
87 |
% |
||||||
Weighted-average number of common shares outstanding: |
||||||||||
Basic |
315 |
319 |
||||||||
Diluted |
317 |
321 |
Schedule 3 |
|||||||
Condensed Consolidated Balance Sheets (Unaudited) |
|||||||
(in millions) |
|
|
|||||
Assets |
|||||||
Current assets: |
|||||||
Cash and equivalents |
$ |
1,249 |
$ |
6,879 |
|||
Trade receivables, net |
7,664 |
8,048 |
|||||
Inventories, net |
12,087 |
11,301 |
|||||
Prepaid expenses and other |
1,972 |
2,117 |
|||||
Assets held for sale |
2,216 |
— |
|||||
Total current assets |
25,188 |
28,345 |
|||||
Property and equipment, net |
2,547 |
1,879 |
|||||
|
14,366 |
9,207 |
|||||
Other assets |
804 |
681 |
|||||
Total assets |
$ |
42,905 |
$ |
40,112 |
|||
Liabilities, Redeemable Noncontrolling Interests and Shareholders' Equity |
|||||||
Current liabilities: |
|||||||
Accounts payable |
$ |
19,194 |
$ |
17,906 |
|||
Current portion of long-term obligations and other short-term borrowings |
702 |
1,327 |
|||||
Other accrued liabilities |
1,890 |
1,988 |
|||||
Liabilities related to assets held for sale |
1,339 |
— |
|||||
Total current liabilities |
23,125 |
21,221 |
|||||
Long-term obligations, less current portion |
9,057 |
9,068 |
|||||
Deferred income taxes and other liabilities |
3,091 |
2,877 |
|||||
Redeemable noncontrolling interests |
13 |
118 |
|||||
|
7,599 |
6,808 |
|||||
Noncontrolling interests |
20 |
20 |
|||||
Total shareholders' equity |
7,619 |
6,828 |
|||||
Total liabilities, redeemable noncontrolling interests and shareholders' equity |
$ |
42,905 |
$ |
40,112 |
Schedule 4 |
|||||||||||||||
Condensed Consolidated Statements of Cash Flows (Unaudited) |
|||||||||||||||
Second Quarter |
Year-to-Date |
||||||||||||||
(in millions) |
2018 |
2017 |
2018 |
2017 |
|||||||||||
Cash flows from operating activities: |
|||||||||||||||
Net earnings |
$ |
1,053 |
$ |
324 |
$ |
1,170 |
$ |
634 |
|||||||
Adjustments to reconcile net earnings to net cash provided by operating activities: |
|||||||||||||||
Depreciation and amortization |
291 |
166 |
520 |
339 |
|||||||||||
Loss on extinguishment of debt |
— |
— |
2 |
— |
|||||||||||
Impairments and loss on sale of other investments |
— |
3 |
6 |
3 |
|||||||||||
Impairments and loss on disposal of assets, net |
67 |
9 |
68 |
12 |
|||||||||||
Share-based compensation |
23 |
24 |
40 |
47 |
|||||||||||
Provision for bad debts |
24 |
22 |
49 |
29 |
|||||||||||
Change in operating assets and liabilities, net of effects from acquisitions: |
|||||||||||||||
Decrease/(increase) in trade receivables |
(258) |
160 |
(617) |
(146) |
|||||||||||
Increase in inventories |
(614) |
(996) |
(995) |
(1,294) |
|||||||||||
Increase in accounts payable |
811 |
1,284 |
2,107 |
1,563 |
|||||||||||
Other accrued liabilities and operating items, net |
(1,118) |
(442) |
(890) |
(529) |
|||||||||||
Net cash provided by operating activities |
279 |
554 |
1,460 |
658 |
|||||||||||
Cash flows from investing activities: |
|||||||||||||||
Acquisition of subsidiaries, net of cash acquired |
(2) |
(2) |
(6,141) |
(11) |
|||||||||||
Additions to property and equipment |
(101) |
(113) |
(168) |
(213) |
|||||||||||
Purchase of available-for-sale securities and other investments |
(3) |
(73) |
(6) |
(125) |
|||||||||||
Proceeds from sale of available-for-sale securities and other investments |
1 |
38 |
65 |
72 |
|||||||||||
Proceeds from maturities of available-for-sale securities |
— |
22 |
— |
39 |
|||||||||||
Proceeds from divestitures and disposal of property and equipment and held for sale assets |
— |
1 |
1 |
1 |
|||||||||||
Net cash used in investing activities |
(105) |
(127) |
(6,249) |
(237) |
|||||||||||
Cash flows from financing activities: |
|||||||||||||||
Payment of contingent consideration obligation |
(2) |
— |
(17) |
— |
|||||||||||
Net change in short-term borrowings |
161 |
8 |
155 |
33 |
|||||||||||
Purchase of noncontrolling interests |
(103) |
(2) |
(106) |
(12) |
|||||||||||
Proceeds from long-term obligations, net of issuance costs |
3 |
— |
3 |
— |
|||||||||||
Reduction of long-term obligations |
(1) |
(59) |
(403) |
(60) |
|||||||||||
Proceeds from interest rate swap terminations |
— |
— |
— |
14 |
|||||||||||
Net tax proceeds/(withholdings) from share-based compensation |
2 |
9 |
(16) |
— |
|||||||||||
Excess tax benefits from share-based compensation |
— |
2 |
— |
32 |
|||||||||||
Dividends on common shares |
(146) |
(144) |
(296) |
(293) |
|||||||||||
Purchase of treasury shares |
— |
(350) |
(150) |
(600) |
|||||||||||
Net cash used in financing activities |
(86) |
(536) |
(830) |
(886) |
|||||||||||
Effect of exchange rates changes on cash and equivalents |
(2) |
(11) |
7 |
(10) |
|||||||||||
Cash reclassified to assets held for sale |
(18) |
— |
(18) |
— |
|||||||||||
Net increase/(decrease) in cash and equivalents |
68 |
(120) |
(5,630) |
(475) |
|||||||||||
Cash and equivalents at beginning of period |
1,181 |
2,001 |
6,879 |
2,356 |
|||||||||||
Cash and equivalents at end of period |
$ |
1,249 |
$ |
1,881 |
$ |
1,249 |
$ |
1,881 |
Schedule 5 |
||||||||||||||||
Segment Information |
||||||||||||||||
Second Quarter |
Second Quarter |
|||||||||||||||
(in millions) |
2018 |
2017 |
(in millions) |
2018 |
2017 |
|||||||||||
Pharmaceutical |
Medical |
|||||||||||||||
Revenue |
Revenue |
|||||||||||||||
Amount |
$ |
31,146 |
$ |
29,743 |
Amount |
$ |
4,044 |
$ |
3,410 |
|||||||
Growth rate |
5 |
% |
5 |
% |
Growth rate |
19 |
% |
8 |
% |
|||||||
Segment profit |
Segment profit |
|||||||||||||||
Amount |
$ |
514 |
$ |
537 |
Amount |
$ |
220 |
$ |
159 |
|||||||
Growth rate |
(4) |
% |
(14) |
% |
Growth rate1 |
38 |
% |
50 |
% |
|||||||
Segment profit margin |
1.65 |
% |
1.81 |
% |
Segment profit margin |
5.43 |
% |
4.68 |
% |
1Segment profit includes a |
Supplemental Consolidated Information
Total consolidated revenue for the three months ended
Total consolidated operating earnings for the three months ended
Schedule 6 |
||||||||||||||||
Segment Information |
||||||||||||||||
Year-to-Date |
Year-to-Date |
|||||||||||||||
(in millions) |
2018 |
2017 |
(in millions) |
2018 |
2017 |
|||||||||||
Pharmaceutical |
Medical |
|||||||||||||||
Revenue |
Revenue |
|||||||||||||||
Amount |
$ |
60,066 |
$ |
58,505 |
Amount |
$ |
7,768 |
$ |
6,690 |
|||||||
Growth rate |
3 |
% |
10 |
% |
Growth rate |
16 |
% |
10 |
% |
|||||||
Segment profit |
Segment profit |
|||||||||||||||
Amount |
$ |
981 |
$ |
1,071 |
Amount |
$ |
348 |
$ |
286 |
|||||||
Growth rate |
(8) |
% |
(17) |
% |
Growth rate1 |
22 |
% |
39 |
% |
|||||||
Segment profit margin |
1.63 |
% |
1.83 |
% |
Segment profit margin |
4.48 |
% |
4.28 |
% |
1Segment profit includes a |
Supplemental Consolidated Information
Total consolidated revenue for the six months ended
Total consolidated operating earnings for the six months ended
Schedule 7 |
|||||||||||||||||||||
GAAP / Non-GAAP Reconciliation1 |
|||||||||||||||||||||
Operating |
Earnings |
Provision for/ |
|||||||||||||||||||
Earnings |
Before |
(Benefit from) |
Net |
Diluted |
|||||||||||||||||
Operating |
Growth |
Income |
Income |
Net |
Earnings2 |
Diluted |
EPS2 |
||||||||||||||
(in millions, except per common share amounts) |
Earnings |
Rate |
Taxes |
Taxes |
Earnings2 |
Growth Rate |
EPS2 |
Growth Rate |
|||||||||||||
Second Quarter 2018 |
|||||||||||||||||||||
GAAP |
$ |
399 |
(26) |
% |
$ |
317 |
$ |
(736) |
$ |
1,053 |
225 |
% |
$ |
3.33 |
226 |
% |
|||||
Restructuring and employee severance |
21 |
21 |
(2) |
23 |
0.07 |
||||||||||||||||
Amortization and other acquisition-related costs |
184 |
184 |
41 |
143 |
0.46 |
||||||||||||||||
Impairments and (gain)/loss on disposal of assets, net |
68 |
68 |
(43) |
111 |
0.35 |
||||||||||||||||
Litigation (recoveries)/charges, net |
58 |
58 |
17 |
41 |
0.13 |
||||||||||||||||
Transitional tax benefit, net3 |
— |
— |
894 |
(894) |
(2.83) |
||||||||||||||||
Non-GAAP |
$ |
730 |
4 |
% |
$ |
648 |
$ |
171 |
$ |
478 |
12 |
% |
$ 1.514 |
13 |
% |
||||||
Second Quarter 2017 |
|||||||||||||||||||||
GAAP |
$ |
542 |
(4) |
% |
$ |
491 |
$ |
167 |
$ |
324 |
— |
% |
$ |
1.02 |
4 |
% |
|||||
LIFO charges/(credits) |
9 |
9 |
4 |
5 |
0.02 |
||||||||||||||||
Restructuring and employee severance |
7 |
7 |
2 |
5 |
0.01 |
||||||||||||||||
Amortization and other acquisition-related costs |
115 |
115 |
39 |
76 |
0.24 |
||||||||||||||||
Impairments and (gain)/loss on disposal of assets, net |
9 |
9 |
3 |
6 |
0.02 |
||||||||||||||||
Litigation (recoveries)/charges, net |
19 |
19 |
7 |
12 |
0.04 |
||||||||||||||||
Non-GAAP |
$ |
701 |
(4) |
% |
$ |
650 |
$ |
222 |
$ |
427 |
(1) |
% |
$ |
1.34 |
3 |
% |
|||||
Operating |
Earnings |
Provision for/ |
|||||||||||||||||||
Earnings |
Before |
(Benefit from) |
Net |
Diluted |
|||||||||||||||||
Operating |
Growth |
Income |
Income |
Net |
Earnings2 |
Diluted |
EPS2 |
||||||||||||||
(in millions, except per common share amounts) |
Earnings |
Rate |
Taxes |
Taxes |
Earnings2 |
Growth Rate |
EPS2 |
Growth Rate |
|||||||||||||
Year-to-Date 2018 |
|||||||||||||||||||||
GAAP |
$ |
661 |
(39) |
% |
$ |
495 |
$ |
(675) |
$ |
1,168 |
85 |
% |
$ |
3.68 |
87 |
% |
|||||
Restructuring and employee severance |
153 |
153 |
45 |
108 |
0.34 |
||||||||||||||||
Amortization and other acquisition-related costs |
368 |
368 |
98 |
270 |
0.85 |
||||||||||||||||
Impairments and (gain)/loss on disposal of assets, net |
68 |
68 |
(43) |
111 |
0.35 |
||||||||||||||||
Litigation (recoveries)/charges, net |
90 |
90 |
30 |
60 |
0.19 |
||||||||||||||||
Loss on extinguishment of debt |
— |
2 |
1 |
1 |
— |
||||||||||||||||
Transitional tax benefit, net3 |
— |
— |
894 |
(894) |
(2.82) |
||||||||||||||||
Non-GAAP |
$ |
1,340 |
(2) |
% |
$ |
1,175 |
$ |
350 |
$ |
823 |
— |
% |
$ 2.604 |
1 |
% |
||||||
Year-to-Date 2017 |
|||||||||||||||||||||
GAAP |
$ |
1,076 |
(9) |
% |
$ |
985 |
$ |
351 |
$ |
633 |
(11) |
% |
$ |
1.97 |
(8) |
% |
|||||
LIFO charges/(credits) |
9 |
9 |
4 |
5 |
0.02 |
||||||||||||||||
Restructuring and employee severance |
16 |
16 |
6 |
10 |
0.03 |
||||||||||||||||
Amortization and other acquisition-related costs |
237 |
237 |
79 |
158 |
0.49 |
||||||||||||||||
Impairments and (gain)/loss on disposal of assets, net |
12 |
12 |
4 |
8 |
0.02 |
||||||||||||||||
Litigation (recoveries)/charges, net |
20 |
20 |
8 |
12 |
0.04 |
||||||||||||||||
Non-GAAP |
$ |
1,370 |
(6) |
% |
$ |
1,279 |
$ |
452 |
$ |
826 |
(7) |
% |
$ |
2.57 |
(4) |
% |
1For more information on these measures, refer to the Use of Non-GAAP Measures and Definitions schedules. |
2attributable to |
3Reflects the estimated net transitional benefit from the re-measurement of our deferred tax assets and liabilities partially offset by the one-time repatriation tax on cash and earnings of foreign subsidiaries. We have not yet completed our analysis of the impact of the Tax Act and, as such, these amounts are provisional estimates and we may record additional provisional amounts or adjustments to the provisional amounts in future periods. |
4Non-GAAP EPS for the three and six months ended |
The sum of the components may not equal the total due to rounding.
We generally apply varying tax rates depending on the item's nature and tax jurisdiction where it is incurred.
Use of Non-GAAP Measures
This earnings release contains financial measures that are not calculated in accordance with
In addition to analyzing our business based on financial information prepared in accordance with GAAP, we use these non-GAAP financial measures internally to evaluate our performance, engage in financial and operational planning, and determine incentive compensation because we believe that these measures provide additional perspective on and, in some circumstances are more closely correlated to, the performance of our underlying, ongoing business. We provide these non-GAAP financial measures to investors as supplemental metrics to assist readers in assessing the effects of items and events on our financial and operating results on a year-over-year basis and in comparing our performance to that of our competitors. However, the non-GAAP financial measures that we use may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. The non-GAAP financial measures disclosed by us should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial statements set forth below should be carefully evaluated.
Exclusions from Non-GAAP Financial Measures
Management believes it is useful to exclude the following items from the non-GAAP measures presented in this earnings release for its own and for investors' assessment of the business for the reasons identified below:
- 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 be meaningfully influenced by customer buying behavior immediately preceding our fiscal year-end), are largely out of our control and cannot be accurately predicted. The exclusion of LIFO charges from non-GAAP metrics facilitates comparison of our current financial results to our historical financial results and to our peer group companies' financial results.
- Restructuring and employee severance costs are excluded because they relate to programs in which we fundamentally change our operations and because they are not part of the ongoing operations of our underlying business.
- Amortization and other acquisition-related costs are excluded primarily for consistency with the presentation of the financial results of our peer group companies. Additionally, costs for amortization of acquisition-related intangible assets are non-cash amounts, which are variable in amount and frequency and are significantly impacted by the timing and size of acquisitions, so their exclusion facilitates comparison of historical, current and forecasted financial results. We also exclude other acquisition-related costs, which are directly related to an acquisition but do not meet the criteria to be recognized on the acquired entity's initial balance sheet as part of the purchase price allocation. These costs are also significantly impacted by the timing, complexity and size of acquisitions.
- Impairments and gain or loss on disposal of assets are excluded because they do not occur in or reflect the ordinary course of our ongoing business operations and are inherently unpredictable in timing and amount, and in the case of impairments, are non-cash amounts, so their exclusion facilitates comparison of historical, current and forecasted financial results.
- Litigation recoveries or charges, net are excluded because they often relate to events that may have occurred in prior or multiple periods, do not occur in or reflect the ordinary course of our business and are inherently unpredictable in timing and amount.
- Loss on extinguishment of debt is excluded because it does not typically occur in the normal course of business and may obscure analysis of trends and financial performance. Additionally, the amount and frequency of this type of charge is not consistent and is significantly impacted by the timing and size of debt financing transactions.
- Transitional tax benefit, net related to the Tax Cuts and Jobs Act is excluded because it results from the one-time impact during the one-year measurement period of a very significant change in the
U.S. federal corporate tax rate and, due to the significant size of the benefit, obscures analysis of trends and financial performance. The transitional tax benefit includes the estimate for the re-measurement of deferred tax assets and liabilities due to the reduction of theU.S. federal corporate income tax rate and the repatriation tax on undistributed foreign earnings, both of which are subject to adjustment during an up to 12 month measurement period.
The tax effect for each of the items listed above, other than the transitional tax benefit item, is determined using the tax rate and other tax attributes applicable to the item and the jurisdiction(s) in which the item is recorded. The gross, tax and net impact of each item are presented with our GAAP to non-GAAP reconciliations.
Forward Looking Non-GAAP Measures
In this earnings release, the Company presents its outlook for fiscal 2018 non-GAAP EPS. The Company does not provide EPS outlook, which is the most directly comparable GAAP measure to non-GAAP EPS, because changes in the items that the Company excludes from EPS to calculate non-GAAP EPS, described above, can be dependent on future events that are less capable of being controlled or reliably predicted by management and are not part of the Company's routine operating activities. Additionally, due to their unpredictability, management does not forecast many of the excluded items for internal use and therefore cannot create or rely on an EPS outlook.
The timing and amount of any of the excluded items could significantly impact the Company's fiscal 2018 EPS. Over the past five fiscal years, the excluded items have lowered the Company's EPS from
Definitions
Growth rate calculation: growth rates in this earnings release are determined by dividing the difference between current-period results and prior-period results by prior-period results.
Non-GAAP operating earnings: operating earnings excluding (1) LIFO charges/(credits), (2) restructuring and employee severance, (3) amortization and other acquisition-related costs, (4) impairments and (gain)/loss on disposal of assets and (5) litigation (recoveries)/charges, net.
Non-GAAP earnings before income taxes: earnings before income taxes excluding (1) LIFO charges/(credits), (2) restructuring and employee severance, (3) amortization and other acquisition-related costs, (4) impairments and (gain)/loss on disposal of assets, (5) litigation (recoveries)/charges, net and (6) loss on extinguishment of debt.
Non-GAAP effective tax rate: (provision for income taxes adjusted for (1) LIFO charges/(credits), (2) restructuring and employee severance, (3) amortization and other acquisition-related costs, (4) impairments and (gain)/loss on disposal of assets, (5) litigation (recoveries)/charges, net, (6) loss on extinguishment of debt, and (7) transitional tax benefit, net) divided by (earnings before income taxes adjusted for the first six items).
Non-GAAP net earnings attributable to
Non-GAAP diluted EPS attributable to
View original content:http://www.prnewswire.com/news-releases/cardinal-health-reports-second-quarter-results-for-fiscal-year-2018-300595730.html
SOURCE
The RMR Group Inc. Announces First Quarter Fiscal 2018 Results
New Jersey Resources Reports First-Quarter Fiscal 2018 Results and Raises Earnings Guidance for the Year
Advisor News
Annuity News
Health/Employee Benefits News
Life Insurance News