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Cardinal Health Reports Q2 Fiscal 2009 Results

Cardinal Health, Inc. (Cardinal Health) has reported revenue of $25 billion for the second quarter fiscal of 2009, compared with the revenue of $23.2 billion in the year-ago quarter. It reported net earnings of $316.5 million, or $0.88 per diluted share, for the second quarter fiscal of 2009, compared with the net earnings of $324.7 million, or $0.89 per diluted share, in the year-ago quarter.

For the quarter ended Dec. 31, 2008, revenue grew 8% to $25 billion, and non-GAAP earnings from continuing operations (1) increased 2% to $335 million. GAAP diluted earnings per share (EPS) from continuing operations declined 1% to $0.88. The impact of special items, impairments and other costs associated with the proposed spinoff of Clinical and Medical Products (CMP) totaled $16 million after tax or $0.05 per share, bringing non-GAAP diluted EPS from continuing operations(2) to $0.93, a 3% increase over the prior-year period.

“Despite a very challenging economic climate, we had solid growth from both of our primary operating segments,” said R. Kerry Clark, chairman and chief executive officer of Cardinal Health. “HSCS returned to year over year segment profit growth in the second quarter, and we expect to remain on track with positive growth for the second half of the fiscal year. CMP continued its track record of double-digit segment profit growth, though we continue to see the deferral in hospital spending affecting its performance for the remainder of the fiscal year. We are reaffirming our full-year guidance, adjusted on Jan. 8, of non-GAAP EPS of $3.50 to $3.60. In addition, we remain on track to spin off the CMP businesses later this year and intend to file the Form 10 registration statement with the Securities and Exchange Commission during our fiscal third quarter.”

“We built upon the momentum from the first quarter and returned the segment to growth during the quarter, with solid contributions from both the pharmaceutical and medical supply chain businesses,” said George Barrett, Cardinal Health vice chairman and chief executive officer of Healthcare Supply Chain Services. “In addition to the pharmaceutical distribution business, our nuclear pharmacy services and hospital supply businesses performed very well in the quarter with strong profit growth. We remain on track to achieve our goals for fiscal 2009.”

“We continue to see remarkable growth from the Enturia acquisition, and continued top- and bottom-line growth in infusion and dispensing during the quarter,” said David Schlotterbeck, Cardinal Health vice chairman and chief executive officer of Clinical and Medical Products. “Despite a strong second quarter, we continue to expect full-year segment profit to be flat or better because of the delay in hospital capital spending that is expected to impact the second half of our fiscal year.”

Additional second quarter and recent highlights:

Nuclear Pharmacy Services signed new, long-term supply agreements with Lantheus Medical Imaging and GE Healthcare to ensure continued and broadened access to their portfolio of products including Cardiolite, Myoview and other proprietary products.

Announced a five-year supply and co-marketing agreement with SRI Surgical to offer surgical kits that include disposable health care products from Cardinal Health and reusable health care products from SRI Surgical.

Awarded one of the largest infusion contracts in company history that will provide 8,000 IV channels to Sutter Health, a leading not-for-profit network of community-based health care providers in Northern California.

Launched the Pyxis MedStation 4000 automated medication dispensing system that offers new features to help hospitals increase the security of high-alert medications and reduce medication errors.

Introduced an industry-first Performance Analytics Service that provides hospitals with customized, actionable recommendations to help improve medication safety.