By Dow Jones Business News,
January 30, 2014, 05:17:00 PM EDT
By Tess Stynes
McKesson Corp. said its fiscal third-quarter earnings fell 79% despite broad revenue growth as the company was hit
by an increase in one-time charges.
For the fiscal year, the company lowered its adjusted per-share earnings estimate to $8.05 and $8.20, from its
previously increased estimate for per-share profit of $8.40 to $8.70.
Chairman and Chief Executive John H. Hammergren said that in the latest period, operating strength was offset by
increased tax reserves due to a dispute with the Canadian tax authorities and a technology segment charge amid an effort
to align its "Horizon Clinicals software platform development efforts and size the organization appropriately given
For the period ended Dec. 31, McKesson reported a profit of $64 million, or 28 cents a share, down from $298
million, or $1.24 a share, a year earlier. The latest period included losses of 39 cents a share related to discontinued
operations. Excluding inventory-accounting adjustments, tax reserve impacts and other items, adjusted earnings from
continuing operations rose to $1.45 from $1.44. Revenue increased 10% to $34.31 billion.
Analysts polled by Thomson Reuters expected per-share earnings of $1.84 and revenue of $33.57 billion.
McKesson last week received the support it need to acquire German rival Celesio AG. The U.S. drug distributor
agreed to buy the Haniel family's shares in Celesio at 23.50 euros($31.85) each. That, along with buying Celesio
convertible bonds from Elliott Management, gives the U.S. firm the 75% stake needed to complete the on-again, off-again
The planned acquisition is expected to boost McKesson's leverage in negotiations with generic drug manufacturers
and broaden its footprint geographically.
Write to Tess Stynes at firstname.lastname@example.org
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