DUBLIN, Ohio, April 18, 2017 /PRNewswire/ -- Cardinal
Health (NYSE: CAH) today is updating its Non-GAAP1
fiscal 2017 earnings per share (EPS) guidance and providing a
preliminary view on fiscal 2018 and 2019. This is in
conjunction with this morning's announcement of the planned
acquisition of Medtronic's Patient Care, Deep Vein Thrombosis and
Nutritional Insufficiency businesses.
Cardinal Health now believes that fiscal 2017 Non-GAAP EPS from
continuing operations will be at the bottom of its previous
guidance range of $5.35 to $5.50,
with the EPS update attributable to expected fourth-quarter
results. This takes into consideration generic deflation,
which the company now expects to be in the low-double digits for
the full fiscal year.
Using the updated fiscal 2017 guidance as a base, Cardinal
Health's preliminary fiscal 2018 view is for Non-GAAP EPS to be
flat to down mid-single digits.
The company's early fiscal 2018 outlook reflects the
following:
- A significant increase in the Medical segment's profit,
including the contributions from the acquisition announced
today. This acquisition is expected to contribute at least
$0.21 Non-GAAP EPS accretion in
fiscal 2018, assuming a first-quarter fiscal 2018 close,
- Several company-specific discrete items that, in the aggregate,
will have a negative impact on EPS of at least $0.50, approximately half of which is reflected
in the Pharmaceutical segment decline mentioned below, and
- While the company expects generic deflation to moderate to
mid-single digits in fiscal 2018, this deflation is still a
headwind for the Pharmaceutical segment for the year. This,
combined with the discrete items mentioned above, could result in
an estimated Pharmaceutical segment profit decline in the
high-single digits versus fiscal 2017.
In addition, fiscal 2019 Non-GAAP EPS is expected to grow at
least high-single digits versus fiscal 2018.
The company expects to provide an update to its fiscal 2018
preliminary outlook at its fourth-quarter earnings call later this
year.
Conference Call
Please also reference today's release entitled "Cardinal Health
to Acquire Leading Patient Product Portfolio from Medtronic for
$6.1 Billion."
Cardinal Health will host a webcast and a conference call today
at 8:30 a.m. Eastern to discuss both
of today's announcements. To access the call and
corresponding slide presentation, go to the Investor Relations page
at ir.cardinalhealth.com. The call also can be accessed by
dialing 913-312-1502, passcode #2495375. There is no
pre-registration for the call; however, participants are advised to
dial into the call at least 10 minutes prior to the start time.
Presentation slides and an audio replay will be archived on the
website after the conclusion of the meeting. The audio replay
will be available until Tuesday, April
25 at 12 p.m. Eastern at
719-457-0820, passcode #2495375.
Non-GAAP Financial Measures (including footnote)
Footnote (1) Non-GAAP diluted earnings per share from continuing
operations: (A) earnings from continuing operations, excluding
(1) LIFO charges/(credits), (2) restructuring and employee
severance, (3) amortization and acquisition-related costs, (4)
impairments and (gain)/loss on disposal of assets, (5) litigation
(recoveries)/charges, net, and (6) loss on extinguishment of debt,
each net of tax, (B) divided by diluted weighted average shares
outstanding. Cardinal Health presents Non-GAAP diluted earnings per
share from continuing operations on a forward-looking basis.
The most directly comparable forward-looking GAAP measure is
diluted earnings per share from continuing operations.
Cardinal Health is unable to provide a quantitative
reconciliation of this forward-looking Non-GAAP measure to the most
directly comparable forward-looking GAAP measure, because Cardinal
Health cannot reliably forecast LIFO charges/(credits),
restructuring and employee severance, amortization and
acquisition-related costs (which Cardinal Health expects to
increase significantly as a result of the acquisition of
Medtronic's Patient Care, Deep Vein Thrombosis and Nutritional
Insufficiency businesses), impairments and (gain)/loss on disposal
of assets and litigation (recoveries)/charges, net, which are
difficult to predict and estimate. Please note that the
unavailable reconciling items could significantly impact Cardinal
Health's future financial results. These items could cause EPS and
the accretion to EPS to differ materially from the company's
Non-GAAP expectations.
About Cardinal Health
Cardinal Health Inc. is a global, integrated healthcare services
and products company, providing customized solutions for hospitals,
healthcare systems, pharmacies, ambulatory surgery centers,
clinical laboratories and physician offices worldwide. The
company provides clinically-proven medical products and
pharmaceuticals and cost-effective solutions that enhance supply
chain efficiency. Cardinal Health connects patients,
providers, payers, pharmacists and manufacturers for integrated
care coordination and better patient management. Backed by
nearly 100 years of experience, with more than 40,000 employees in
nearly 60 countries, Cardinal Health ranks among the top 25 on the
Fortune 500. For more information, visit
cardinalhealth.com, follow @CardinalHealth on Twitter and connect
on LinkedIn at linkedin.com/company/cardinal-health.
Cautions Concerning Forward-Looking Statements
This release contains forward-looking statements addressing
Cardinal Health's plans to acquire Medtronic's Patient Care, Deep
Vein Thrombosis and Nutritional Insufficiency businesses and other
statements about future 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, trends 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: the ability to successfully complete the acquisition of
the Patient Care, Deep Vein Thrombosis and Nutritional
Insufficiency businesses on a timely basis, including receipt of
required regulatory approvals and satisfaction of other conditions;
the conditions of the credit markets and the company's ability to
issue debt to fund the acquisition on acceptable terms; if the
acquisition of the Patient Care, Deep Vein Thrombosis and
Nutritional Insufficiency businesses is completed, the ability to
retain the acquired businesses' customers and employees, the
ability to successfully integrate the acquired business into
Cardinal Health's operations, and the ability to achieve the
expected synergies as well as accretion in earnings; competitive
pressures in Cardinal Health's various lines of business; the
amount or rate of generic and branded pharmaceutical price
appreciation or deflation and the timing of and benefit from
generic pharmaceutical introductions; the ability to maintain the
benefits from the generic sourcing venture with CVS Health; the
risk of non-renewal or a default under one or more key customer or
supplier arrangements or changes to the terms of or level of
purchases under those arrangements; uncertainties due to government
health care reform including proposals to modify or repeal the
Affordable Care Act; uncertainties with respect to U.S. tax or
trade laws, including proposals relating to a "border adjustment
tax" or new import tariffs; changes in the distribution patterns or
reimbursement rates for health care products and services; the
effects of any investigation or action by any regulatory authority;
and changes in foreign currency rates and the cost of commodities
such as oil-based resins, cotton, latex and diesel fuel. Cardinal
Health is subject to additional risks and uncertainties described
in Cardinal Health's Form 10-K, Form 10-Q and Form 8-K reports and
exhibits to those reports. This release reflects management's views
as of April 18, 2017. Except to the
extent required by applicable law, Cardinal Health undertakes no
obligation to update or revise any forward-looking
statement.
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SOURCE Cardinal Health