AmerisourceBergen Corporation (NYSE: ABC) today reported that in its fiscal year 2022 first quarter ended December 31, 2021, revenue increased 13.5 percent year-over-year to $59.6 billion. On the basis of U.S. generally accepted accounting principles (GAAP), diluted earnings per share (EPS) was $2.13 for the December quarter of fiscal 2022, compared to $1.81 in the prior year quarter. Adjusted diluted EPS, which is a non-GAAP measure that excludes items described below, increased 18.3 percent to $2.58 in the fiscal first quarter.
AmerisourceBergen is updating its outlook for fiscal year 2022. The Company does not provide forward-looking guidance on a GAAP basis, as discussed below in Fiscal Year 2022 Expectations. Adjusted diluted EPS guidance has been raised from the previous range of $10.50 to $10.80 to a range of $10.60 to $10.90.
"AmerisourceBergen continues to play an important role in supporting the COVID response, both in the U.S. and abroad," said Steven H. Collis, Chairman, President and Chief Executive Officer of AmerisourceBergen. "We are proud of the work our teams do in leveraging our capabilities and expertise to deliver innovative solutions to help advance pharmaceutical innovation and access."
"As we move further into 2022, AmerisourceBergen remains focused on execution and delivering differentiated solutions through our pharmaceutical-centric strategy," Mr. Collis continued. "Our updated fiscal 2022 guidance reflects the value of purpose-minded team members helping us play a crucial role in supporting the evolving needs of the global healthcare system and I remain inspired by their dedication."
First Quarter Fiscal Year 2022 Summary Results
|
GAAP |
Adjusted (Non-GAAP) |
Revenue |
$59.6B |
$59.6B |
Gross Profit |
$2.1B |
$2.0B |
Operating Expenses |
$1.4B |
$1.3B |
Operating Income |
$644M |
$749M |
Interest Expense, Net |
$53M |
$53M |
Effective Tax Rate |
24.6% |
21.3% |
Net Income Attributable to AmerisourceBergen Corporation |
$449M |
$545M |
Diluted Earnings Per Share |
$2.13 |
$2.58 |
Diluted Shares Outstanding |
211.2M |
211.2M |
Below, AmerisourceBergen presents descriptive summaries of the Company’s GAAP and adjusted (non-GAAP) quarterly results. In the tables that follow, GAAP results and GAAP to non-GAAP reconciliations are presented. For more information related to non-GAAP financial measures, including adjustments made in the periods presented, please refer to the "Supplemental Information Regarding non-GAAP Financial Measures" following the tables.
First Quarter GAAP Results
First Quarter Adjusted (non-GAAP) Results
Segment Discussion
The Company is organized geographically based upon the products and services it provides to its customers. The Company has re-aligned its reporting structure under two reportable segments: U.S. Healthcare Solutions and International Healthcare Solutions. U.S. Healthcare Solutions consists of the legacy Pharmaceutical Distribution Services reportable segment (excluding Profarma), MWI Animal Health, Xcenda, Lash Group, and ICS 3PL. International Healthcare Solutions consists of Alliance Healthcare, World Courier, Innomar, Profarma, and Profarma Specialty. The Company’s previously reported segment results have been revised to conform to its re-aligned reporting structure.
U.S. Healthcare Solutions
U.S. Healthcare Solutions revenue was $53.0 billion in the first quarter of fiscal 2022, an increase of 2.7 percent compared to the same quarter in the prior fiscal year primarily due to overall market growth, increased sales to specialty physician practices, and growth in the MWI Animal Health business, partially offset by lower revenue from COVID-19 therapies. Segment operating income of $569.1 million in the first quarter of fiscal 2022 was up 0.6 percent compared to the same period in the previous fiscal year as a result of an increase in gross profit, largely offset by an increase in operating expenses.
International Healthcare Solutions
Revenue in International Healthcare Solutions was $6.6 billion in the first quarter of fiscal 2022, an increase from the previous fiscal year’s first quarter of 604.2 percent on a reported basis, and 632 percent on a constant currency basis, primarily due to the June 2021 acquisition of Alliance Healthcare. Segment operating income in the first quarter of fiscal 2022 was $180.1 million, an increase of 253.1 percent on a reported basis and 268 percent on a constant currency basis, due to the June 2021 acquisition of Alliance Healthcare.
Recent Company Highlights & Milestones
Fiscal Year 2022 Expectations
The Company does not provide forward-looking guidance on a GAAP basis as certain financial information, the probable significance of which cannot be determined, is not available or cannot be reasonably estimated. Please refer to the Supplemental Information Regarding Non-GAAP Financial Measures following the tables for additional information.
Fiscal Year 2022 Expectations on an Adjusted (non-GAAP) Basis
AmerisourceBergen is now updating its fiscal year 2022 financial guidance to reflect the updated full year expectations from COVID therapy distribution and higher interest expense. The Company now expects:
Additional expectations now include:
All other previously communicated aspects of the Company's fiscal year 2022 financial guidance and assumptions remain the same.
Dividend Declaration
The Company's Board of Directors declared a quarterly cash dividend of $0.46 per common share, payable February 28, 2022, to stockholders of record at the close of business on February 14, 2022.
Opioid Litigation
On December 22, 2021, the Company announced that the deadline for political subdivisions in participating states to join the previously announced proposed opioid settlement agreement was extended from January 2, 2022 to January 26, 2022. Subsequently, several additional states confirmed their intent to sign on the agreement, increasing the number of participating states to 46 out of 49 states, all 5 U.S. territories and Washington, D.C. The deadline for the Company and the two other national distributors to independently determine whether to proceed with the proposed opioid settlement is February 25, 2022.
Conference Call & Slide Presentation
The Company will host a conference call to discuss the results at 8:30 a.m. ET on February 2, 2022. A slide presentation for investors has also been posted on the Company's website at investor.amerisourcebergen.com. Participating in the conference call will be:
The dial-in number for the live call will be (844) 200-6205. From outside the United States and Canada, dial +1 (929) 526-1599. The access code for the call will be 034703. The live call will also be webcast via the Company’s website at investor.amerisourcebergen.com. Users are encouraged to log on to the webcast approximately 10 minutes in advance of the scheduled start time of the call.
Replays of the call will be made available via telephone and webcast. A replay of the webcast will be posted on investor.amerisourcebergen.com approximately one hour after the completion of the call and will remain available for one year. The telephone replay will also be available approximately one hour after the completion of the call and will remain available for seven days. To access the telephone replay from within the U.S. and Canada, dial (866) 813-9403. From outside the United States and Canada, dial +44 (204) 525-0658. The access code for the replay is 009158.
Upcoming Investor Events
AmerisourceBergen management will be attending the following investor conference in the coming months:
About AmerisourceBergen
AmerisourceBergen fosters a positive impact on the health of people and communities around the world by advancing the development and delivery of pharmaceuticals and healthcare products. As a leading global healthcare company, with a foundation in pharmaceutical distribution and solutions for manufacturers, pharmacies and providers, we create unparalleled access, efficiency and reliability for human and animal health. Our 42,000 global team members power our purpose: We are united in our responsibility to create healthier futures. AmerisourceBergen is ranked #8 on the Fortune 500 with more than $200 billion in annual revenue. Learn more at investor.amerisourcebergen.com.
AmerisourceBergen's Cautionary Note Regarding Forward-Looking Statements
Certain of the statements contained in this press release are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Securities Exchange Act"). Words such as "expect," "likely," "outlook," "forecast," "would," "could," "should," "can," "project," "intend," "plan," "continue," "sustain," "synergy," "on track," "believe," "seek," "estimate," "anticipate," "may," "possible," "assume," variations of such words, and similar expressions are intended to identify such forward-looking statements. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances and speak only as of the date hereof. These statements are not guarantees of future performance and are based on assumptions and estimates that could prove incorrect or could cause actual results to vary materially from those indicated. Among the factors that could cause actual results to differ materially from those projected, anticipated, or implied are the following: unfavorable trends in brand and generic pharmaceutical pricing, including in rate or frequency of price inflation or deflation; competition and industry consolidation of both customers and suppliers resulting in increasing pressure to reduce prices for our products and services; changes in the United States healthcare and regulatory environment, including changes that could impact prescription drug reimbursement under Medicare and Medicaid; increasing governmental regulations regarding the pharmaceutical supply channel; declining reimbursement rates for pharmaceuticals; continued federal and state government enforcement initiatives to detect and prevent suspicious orders of controlled substances and the diversion of controlled substances; continued prosecution or suit by federal, state and other governmental entities of alleged violations of laws and regulations regarding controlled substances, including due to failure to achieve a global resolution of the multi-district opioid litigation and other related state court litigation, and any related disputes, including shareholder derivative lawsuits; increased federal scrutiny and litigation, including qui tam litigation, for alleged violations of laws and regulations governing the marketing, sale, purchase and/or dispensing of pharmaceutical products or services, and associated reserves and costs; failure to comply with the Corporate Integrity Agreement; material adverse resolution of pending legal proceedings; the retention of key customer or supplier relationships under less favorable economics or the adverse resolution of any contract or other dispute with customers or suppliers; changes to customer or supplier payment terms, including as a result of the COVID-19 impact on such payment terms; the integration of the Alliance Healthcare business into the Company being more difficult, time consuming or costly than expected; the Company’s or Alliance Healthcare’s failure to achieve expected or targeted future financial and operating performance and results; the effects of disruption from the acquisition and related strategic transactions on the respective businesses of the Company and Alliance Healthcare and the fact that the acquisition and related strategic transactions may make it more difficult to establish or maintain relationships with employees, suppliers and other business partners; the acquisition of businesses, including the acquisition of the Alliance Healthcare businesses and related strategic transactions, that do not perform as expected, or that are difficult to integrate or control, or the inability to capture all of the anticipated synergies related thereto or to capture the anticipated synergies within the expected time period; risks associated with the strategic, long-term relationship between Walgreens Boots Alliance, Inc. and the Company, including with respect to the pharmaceutical distribution agreement and/or the global generic purchasing services arrangement; managing foreign expansion, including non-compliance with the U.S. Foreign Corrupt Practices Act, anti-bribery laws, economic sanctions and import laws and regulations; financial market volatility and disruption; changes in tax laws or legislative initiatives that could adversely affect the Company's tax positions and/or the Company's tax liabilities or adverse resolution of challenges to the Company's tax positions; substantial defaults in payment, material reduction in purchases by or the loss, bankruptcy or insolvency of a major customer, including as a result of COVID-19; the loss, bankruptcy or insolvency of a major supplier, including as a result of COVID-19; financial and other impacts of COVID-19 on our operations or business continuity; changes to the customer or supplier mix; malfunction, failure or breach of sophisticated information systems to operate as designed; risks generally associated with data privacy regulation and the international transfer of personal data; natural disasters or other unexpected events, such as additional pandemics, that affect the Company’s operations; the impairment of goodwill or other intangible assets (including any additional impairments with respect to foreign operations), resulting in a charge to earnings; the Company's ability to manage and complete divestitures; the disruption of the Company's cash flow and ability to return value to its stockholders in accordance with its past practices; interest rate and foreign currency exchange rate fluctuations; declining economic conditions in the United States and abroad; and other economic, business, competitive, legal, tax, regulatory and/or operational factors affecting the Company's business generally. Certain additional factors that management believes could cause actual outcomes and results to differ materially from those described in forward-looking statements are set forth (i) in Item 1A (Risk Factors), in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2021 and elsewhere in that report and (ii) in other reports filed by the Company pursuant to the Securities Exchange Act. The Company undertakes no obligation to publicly update or revise any forward-looking statements, except as required by the federal securities laws.
AMERISOURCEBERGEN CORPORATION FINANCIAL SUMMARY (in thousands, except per share data) (unaudited) |
|||||||||||||||||
|
|
Three
|
|
% of
Revenue |
|
Three
|
|
% of
Revenue |
|
%
Change |
|||||||
Revenue |
|
$ |
59,628,810 |
|
|
|
|
$ |
52,516,556 |
|
|
|
|
13.5 |
% |
||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Cost of goods sold |
|
|
57,568,451 |
|
|
|
|
|
51,064,326 |
|
|
|
|
12.7 |
% |
||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Gross profit 1 |
|
|
2,060,359 |
|
|
3.46 |
% |
|
|
1,452,230 |
|
|
2.77 |
% |
|
41.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|||||||
Distribution, selling, and administrative |
|
|
1,170,110 |
|
|
1.96 |
% |
|
|
735,068 |
|
|
1.40 |
% |
|
59.2 |
% |
Depreciation and amortization |
|
|
175,929 |
|
|
0.30 |
% |
|
|
99,553 |
|
|
0.19 |
% |
|
76.7 |
% |
Employee severance, litigation, and other 2 |
|
|
64,969 |
|
|
|
|
|
70,381 |
|
|
|
|
|
|||
Impairment of assets |
|
|
4,946 |
|
|
|
|
|
— |
|
|
|
|
|
|||
Total operating expenses |
|
|
1,415,954 |
|
|
2.37 |
% |
|
|
905,002 |
|
|
1.72 |
% |
|
56.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Operating income |
|
|
644,405 |
|
|
1.08 |
% |
|
|
547,228 |
|
|
1.04 |
% |
|
17.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Other income, net 3 |
|
|
(5,172 |
) |
|
|
|
|
(14,268 |
) |
|
|
|
|
|||
Interest expense, net |
|
|
53,372 |
|
|
|
|
|
33,614 |
|
|
|
|
58.8 |
% |
||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Income before income taxes |
|
|
596,205 |
|
|
1.00 |
% |
|
|
527,882 |
|
|
1.01 |
% |
|
12.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Income tax expense 4 |
|
|
146,789 |
|
|
|
|
|
149,175 |
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Net income |
|
|
449,416 |
|
|
0.75 |
% |
|
|
378,707 |
|
|
0.72 |
% |
|
18.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Net income attributable to noncontrolling interests |
|
|
(311 |
) |
|
|
|
|
(3,862 |
) |
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Net income attributable to AmerisourceBergen Corporation |
|
$ |
449,105 |
|
|
0.75 |
% |
|
$ |
374,845 |
|
|
0.71 |
% |
|
19.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Earnings per share: |
|
|
|
|
|
|
|
|
|
|
|||||||
Basic |
|
$ |
2.15 |
|
|
|
|
$ |
1.83 |
|
|
|
|
17.5 |
% |
||
Diluted |
|
$ |
2.13 |
|
|
|
|
$ |
1.81 |
|
|
|
|
17.7 |
% |
||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Weighted average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|||||||
Basic |
|
|
208,555 |
|
|
|
|
|
204,683 |
|
|
|
|
1.9 |
% |
||
Diluted |
|
|
211,168 |
|
|
|
|
|
206,801 |
|
|
|
|
2.1 |
% |
________________________________________
1 Includes $44.7 million and $25.7 million of LIFO credits in the three months ended December 31, 2021 and 2020, respectively.
2 Includes $0.3 million of employee severance, a $6.8 million legal accrual related to opioid litigation settlements, $25.8 million of legal fees in connection with opioid lawsuits and investigations, and $32.0 million of other costs in connection with acquisition-related deal and integration costs, business transformation efforts, and other restructuring initiatives in the three months ended December 31, 2021. Includes $32.1 million of legal fees in connection with opioid lawsuits and investigations and $38.3 million of other costs in connection with acquisition-related deal and integration costs, business transformation efforts, and other restructuring initiatives in the three months ended December 31, 2020.
3 Includes $5.3 million and $14.0 million of gains on the currency remeasurement of deferred tax assets relating to 2020 Swiss tax reform in the three months ended December 31, 2021 and 2020, respectively.
4 Includes $11.1 million of discrete tax expense and $8.9 million of amortization expense relating to deferred tax assets established in connection with 2020 Swiss tax reform in the three months ended December 31, 2021. Includes $52.3 million of expense relating to Swiss tax reform and $20.4 million of discrete tax benefits primarily attributable to the income tax deductions resulting from the shutdown of the PharMEDium business in the three months ended December 31, 2020.
AMERISOURCEBERGEN CORPORATION GAAP TO NON-GAAP RECONCILIATIONS (in thousands, except per share data) (unaudited) |
|||||||||||||||||||||||||||||||||
|
|
Three Months Ended December 31, 2021 |
|
||||||||||||||||||||||||||||||
|
|
Gross Profit |
|
Operating
|
|
Operating
|
|
Income
|
|
Income Tax
Expense |
|
Net Income
|
|
Net Income
to ABC |
|
Diluted
|
|
||||||||||||||||
GAAP |
|
$ |
2,060,359 |
|
|
$ |
1,415,954 |
|
|
$ |
644,405 |
|
|
$ |
596,205 |
|
|
$ |
146,789 |
|
|
$ |
(311 |
) |
|
$ |
449,105 |
|
|
$ |
2.13 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
LIFO credit |
|
|
(44,679 |
) |
|
|
— |
|
|
|
(44,679 |
) |
|
|
(44,679 |
) |
|
|
(10,245 |
) |
|
|
— |
|
|
|
(34,434 |
) |
|
|
(0.16 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Acquisition-related intangibles amortization |
|
|
— |
|
|
|
(79,506 |
) |
|
|
79,506 |
|
|
|
79,506 |
|
|
|
18,230 |
|
|
|
(1,790 |
) |
|
|
59,486 |
|
|
|
0.28 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Employee severance, litigation, and other |
|
|
— |
|
|
|
(64,969 |
) |
|
|
64,969 |
|
|
|
64,969 |
|
|
|
13,333 |
|
|
|
— |
|
|
|
51,636 |
|
|
|
0.24 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Impairment of assets |
|
|
— |
|
|
|
(4,946 |
) |
|
|
4,946 |
|
|
|
4,946 |
|
|
|
— |
|
|
|
— |
|
|
|
4,946 |
|
|
|
0.02 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Certain discrete tax expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(11,079 |
) |
|
|
— |
|
|
|
11,079 |
|
|
|
0.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Tax reform 1 |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(5,307 |
) |
|
|
(8,875 |
) |
|
|
— |
|
|
|
3,568 |
|
|
|
0.02 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Adjusted Non-GAAP |
|
$ |
2,015,680 |
|
|
$ |
1,266,533 |
|
|
$ |
749,147 |
|
|
$ |
695,640 |
|
|
$ |
148,153 |
|
|
$ |
(2,101 |
) |
|
$ |
545,386 |
|
|
$ |
2.58 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Adjusted Non-GAAP % change vs. prior year |
|
|
41.3 |
% |
|
|
56.4 |
% |
|
|
21.4 |
% |
|
|
19.2 |
% |
|
|
15.4 |
% |
|
|
|
|
21.0 |
% |
|
|
18.3 |
% |
|
Percentages of Revenue: |
|
GAAP |
|
Adjusted Non-GAAP |
Gross profit |
|
3.46% |
|
3.38% |
Operating expenses |
|
2.37% |
|
2.12% |
Operating income |
|
1.08% |
|
1.26% |
________________________________________
1 Includes a $5.3 million gain on the currency remeasurement of the deferred tax assets relating to Swiss tax reform, which is recorded within Other Income, Net.
Note: For more information related to non-GAAP financial measures, refer to the section titled "Supplemental Information Regarding Non-GAAP Financial Measures" of this release.
AMERISOURCEBERGEN CORPORATION GAAP TO NON-GAAP RECONCILIATIONS (in thousands, except per share data) (unaudited) |
||||||||||||||||||||||||||||||||
|
|
Three Months Ended December 31, 2020 |
||||||||||||||||||||||||||||||
|
|
Gross Profit |
|
Operating
|
|
Operating
|
|
Income Before
|
|
Income Tax
|
|
Net Income
|
|
Net Income
to ABC |
|
Diluted
Per Share |
||||||||||||||||
GAAP |
|
$ |
1,452,230 |
|
|
$ |
905,002 |
|
|
$ |
547,228 |
|
|
$ |
527,882 |
|
|
$ |
149,175 |
|
|
$ |
(3,862 |
) |
|
$ |
374,845 |
|
|
$ |
1.81 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
LIFO Credit |
|
|
(25,727 |
) |
|
|
— |
|
|
|
(25,727 |
) |
|
|
(25,727 |
) |
|
|
(4,976 |
) |
|
|
— |
|
|
|
(20,751 |
) |
|
|
(0.10 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Acquisition-related intangibles amortization |
|
|
— |
|
|
|
(25,034 |
) |
|
|
25,034 |
|
|
|
25,034 |
|
|
|
4,096 |
|
|
|
(437 |
) |
|
|
20,501 |
|
|
|
0.10 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Employee severance, litigation, and other |
|
|
— |
|
|
|
(70,381 |
) |
|
|
70,381 |
|
|
|
70,381 |
|
|
|
11,974 |
|
|
|
— |
|
|
|
58,407 |
|
|
|
0.28 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Certain discrete tax benefits 1 |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
20,425 |
|
|
|
— |
|
|
|
(20,425 |
) |
|
|
(0.10 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Tax reform 2 |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(14,039 |
) |
|
|
(52,318 |
) |
|
|
— |
|
|
|
38,279 |
|
|
|
0.19 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Adjusted Non-GAAP |
|
$ |
1,426,503 |
|
|
$ |
809,587 |
|
|
$ |
616,916 |
|
|
$ |
583,531 |
|
|
$ |
128,376 |
|
|
$ |
(4,299 |
) |
|
$ |
450,856 |
|
|
$ |
2.18 |
|
Percentages of Revenue: |
|
GAAP |
|
Adjusted Non-GAAP |
Gross profit |
|
2.77% |
|
2.72% |
Operating expenses |
|
1.72% |
|
1.54% |
Operating income |
|
1.04% |
|
1.17% |
________________________________________
1 Represents discrete tax benefits primarily attributable to the income tax deductions resulting from the permanent shutdown of the PharMEDium business.
2 Represents tax expense relating to Swiss tax reform and a $14.0 million gain on the currency remeasurement of the related deferred tax assets, which is recorded within Other Income, Net.
Note: For more information related to non-GAAP financial measures, refer to the section titled "Supplemental Information Regarding Non-GAAP Financial Measures" of this release.
AMERISOURCEBERGEN CORPORATION SUMMARY SEGMENT INFORMATION (in thousands) (unaudited) |
|||||||||||
|
|
Three Months Ended December 31, |
|||||||||
Revenue |
|
|
2021 |
|
|
|
2020 |
|
|
% Change |
|
U.S. Healthcare Solutions |
|
$ |
52,979,647 |
|
|
$ |
51,572,581 |
|
|
2.7 |
% |
International Healthcare Solutions |
|
|
6,649,782 |
|
|
|
944,311 |
|
|
604.2 |
% |
Intersegment eliminations |
|
|
(619 |
) |
|
|
(336 |
) |
|
|
|
|
|
|
|
|
|
|
|||||
Revenue |
|
$ |
59,628,810 |
|
|
$ |
52,516,556 |
|
|
13.5 |
% |
|
|
Three Months Ended December 31, |
|||||||||
Operating income |
|
|
2021 |
|
|
|
2020 |
|
|
% Change |
|
U.S. Healthcare Solutions |
|
$ |
569,087 |
|
|
$ |
565,927 |
|
|
0.6 |
% |
International Healthcare Solutions |
|
|
180,060 |
|
|
|
50,989 |
|
|
253.1 |
% |
Total segment operating income |
|
|
749,147 |
|
|
|
616,916 |
|
|
21.4 |
% |
|
|
|
|
|
|
|
|||||
LIFO credit |
|
|
44,679 |
|
|
|
25,727 |
|
|
|
|
Acquisition-related intangibles amortization |
|
|
(79,506 |
) |
|
|
(25,034 |
) |
|
|
|
Employee severance, litigation, and other |
|
|
(64,969 |
) |
|
|
(70,381 |
) |
|
|
|
Impairment of assets |
|
|
(4,946 |
) |
|
|
— |
|
|
|
|
Operating income |
|
$ |
644,405 |
|
|
$ |
547,228 |
|
|
|
|
|
|
|
|
|
|
|
|||||
Percentages of Revenue: |
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|||||
U.S. Healthcare Solutions |
|
|
|
|
|
|
|||||
Gross profit |
|
|
2.41 |
% |
|
|
2.41 |
% |
|
|
|
Operating expenses |
|
|
1.34 |
% |
|
|
1.31 |
% |
|
|
|
Operating income |
|
|
1.07 |
% |
|
|
1.10 |
% |
|
|
|
|
|
|
|
|
|
|
|||||
International Healthcare Solutions |
|
|
|
|
|
|
|||||
Gross profit |
|
|
11.08 |
% |
|
|
19.71 |
% |
|
|
|
Operating expenses |
|
|
8.38 |
% |
|
|
14.31 |
% |
|
|
|
Operating income |
|
|
2.71 |
% |
|
|
5.40 |
% |
|
|
|
|
|
|
|
|
|
|
|||||
AmerisourceBergen Corporation (GAAP) |
|
|
|
|
|
|
|||||
Gross profit |
|
|
3.46 |
% |
|
|
2.77 |
% |
|
|
|
Operating expenses |
|
|
2.37 |
% |
|
|
1.72 |
% |
|
|
|
Operating income |
|
|
1.08 |
% |
|
|
1.04 |
% |
|
|
|
|
|
|
|
|
|
|
|||||
AmerisourceBergen Corporation (Non-GAAP) |
|
|
|
|
|
|
|||||
Adjusted gross profit |
|
|
3.38 |
% |
|
|
2.72 |
% |
|
|
|
Adjusted operating expenses |
|
|
2.12 |
% |
|
|
1.54 |
% |
|
|
|
Adjusted operating income |
|
|
1.26 |
% |
|
|
1.17 |
% |
|
|
Note: For more information related to non-GAAP financial measures, refer to the section titled "Supplemental Information Regarding Non-GAAP Financial Measures" of this release.
AMERISOURCEBERGEN CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) (unaudited) |
|||||
|
December 31, |
|
September 30, |
||
|
|
2021 |
|
|
2021 |
ASSETS |
|
|
|
||
|
|
|
|
||
Current assets: |
|
|
|
||
Cash and cash equivalents |
$ |
3,168,881 |
|
$ |
2,547,142 |
Accounts receivable, net |
|
17,146,056 |
|
|
18,167,175 |
Inventories |
|
16,293,933 |
|
|
15,368,352 |
Right to recover assets |
|
1,361,828 |
|
|
1,271,557 |
Prepaid expenses and other |
|
1,408,187 |
|
|
1,448,383 |
Total current assets |
|
39,378,885 |
|
|
38,802,609 |
|
|
|
|
||
Property and equipment, net |
|
2,129,697 |
|
|
2,162,961 |
Goodwill and other intangible assets |
|
14,002,463 |
|
|
14,287,458 |
Deferred income taxes |
|
270,049 |
|
|
290,791 |
Other long-term assets |
|
1,796,470 |
|
|
1,793,986 |
|
|
|
|
||
Total assets |
$ |
57,577,564 |
|
$ |
57,337,805 |
|
|
|
|
||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
||
|
|
|
|
||
Current liabilities: |
|
|
|
||
Accounts payable |
$ |
38,617,734 |
|
$ |
38,009,954 |
Other current liabilities |
|
2,727,308 |
|
|
3,048,474 |
Short-term debt |
|
268,563 |
|
|
300,213 |
Total current liabilities |
|
41,613,605 |
|
|
41,358,641 |
|
|
|
|
||
Long-term debt |
|
6,412,537 |
|
|
6,383,711 |
|
|
|
|
||
Accrued income taxes |
|
288,915 |
|
|
281,070 |
Deferred income taxes |
|
1,689,496 |
|
|
1,685,296 |
Other long-term liabilities |
|
1,060,416 |
|
|
1,082,723 |
Accrued litigation liability |
|
5,911,474 |
|
|
5,961,953 |
|
|
|
|
||
Total equity |
|
601,121 |
|
|
584,411 |
|
|
|
|
||
Total liabilities and stockholders' equity |
$ |
57,577,564 |
|
$ |
57,337,805 |
AMERISOURCEBERGEN CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited) |
|||||||
|
Three Months Ended December 31, |
||||||
|
|
2021 |
|
|
|
2020 |
|
Operating Activities: |
|
|
|
||||
Net income |
$ |
449,416 |
|
|
$ |
378,707 |
|
Adjustments to reconcile net income to net cash provided by operating activities |
|
221,652 |
|
|
|
234,717 |
|
Changes in operating assets and liabilities, excluding the effects of acquisitions: |
|
|
|
||||
Accounts receivable |
|
716,380 |
|
|
|
(906,495 |
) |
Inventories |
|
(989,993 |
) |
|
|
(545,459 |
) |
Accounts payable |
|
824,056 |
|
|
|
1,721,495 |
|
Other, net |
|
(358,100 |
) |
|
|
20,088 |
|
Net cash provided by operating activities |
|
863,411 |
|
|
|
903,053 |
|
|
|
|
|
||||
Investing Activities: |
|
|
|
||||
Capital expenditures |
|
(79,691 |
) |
|
|
(65,410 |
) |
Cost of acquired companies, net of cash acquired |
|
(62,641 |
) |
|
|
— |
|
Other, net |
|
(788 |
) |
|
|
— |
|
Net cash used in investing activities |
|
(143,120 |
) |
|
|
(65,410 |
) |
|
|
|
|
||||
Financing Activities: |
|
|
|
||||
Net debt repayments |
|
(6,486 |
) |
|
|
(431,250 |
) |
Purchases of common stock |
|
— |
|
|
|
(56,175 |
) |
Exercises of stock options |
|
38,937 |
|
|
|
58,216 |
|
Cash dividends on common stock |
|
(100,541 |
) |
|
|
(91,103 |
) |
Other |
|
(38,333 |
) |
|
|
(24,159 |
) |
Net cash used in financing activities |
|
(106,423 |
) |
|
|
(544,471 |
) |
|
|
|
|
||||
Effect of exchange rate changes on cash, cash equivalents, and restricted cash |
|
(2,654 |
) |
|
|
— |
|
|
|
|
|
||||
Increase in cash, cash equivalents, and restricted cash, including cash classified within assets held for sale |
|
611,214 |
|
|
|
293,172 |
|
Plus: Decrease in cash classified within assets held for sale |
|
1,038 |
|
|
|
— |
|
Increase in cash, cash equivalents, and restricted cash |
|
612,252 |
|
|
|
293,172 |
|
|
|
|
|
||||
Cash, cash equivalents, and restricted cash at beginning of period 1 |
|
3,070,128 |
|
|
|
4,597,746 |
|
|
|
|
|
||||
Cash, cash equivalents, and restricted cash at end of period 1 |
$ |
3,682,380 |
|
|
$ |
4,890,918 |
|
________________________________________
1 The following represents a reconciliation of cash and cash equivalents in the Condensed Consolidated Balance Sheets to cash, cash equivalents, and restricted cash used in the Condensed Consolidated Statements of Cash Flows:
|
|
December 31,
|
|
September 30,
|
||
Cash and cash equivalents |
|
$ |
3,168,881 |
|
$ |
2,547,142 |
Restricted cash (included in Prepaid Expenses and Other) |
|
|
453,485 |
|
|
462,986 |
Restricted cash (included in Other Long-Term Assets) |
|
|
60,014 |
|
|
60,000 |
Cash, cash equivalents, and restricted cash |
|
$ |
3,682,380 |
|
$ |
3,070,128 |
SUPPLEMENTAL INFORMATION REGARDING
NON-GAAP FINANCIAL MEASURES
To supplement the financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), the Company uses the non-GAAP financial measures described below. The non-GAAP financial measures should be viewed in addition to, and not in lieu of, financial measures calculated in accordance with GAAP. These supplemental measures may vary from, and may not be comparable to, similarly titled measures by other companies.
The non-GAAP financial measures are presented because management uses non-GAAP financial measures to evaluate the Company’s operating performance, to perform financial planning, and to determine incentive compensation. Therefore, the Company believes that the presentation of non-GAAP financial measures provides useful supplementary information to, and facilitates additional analysis by, investors. The presented non-GAAP financial measures exclude items that management does not believe reflect the Company’s core operating performance because such items are outside the control of the Company or are inherently unusual, non-operating, unpredictable, non-recurring, or non-cash. We have included the following non-GAAP earnings-related financial measures in this release:
The company also presents certain information related to current period operating results in “constant currency,” which is a non-GAAP financial measure. These amounts are calculated by translating current period results at the foreign currency exchange rates used in the comparable period in the prior year. The company presents such constant currency financial information because it has significant operations outside of the United States reporting in currencies other than the U.S. dollar and this presentation provides a framework to assess how its business performed excluding the impact of foreign currency exchange rate fluctuations.
In addition, the Company updated its non-GAAP fiscal year 2022 guidance for diluted earnings per share and operating income, and has previously provided non-GAAP fiscal year 2022 guidance for adjusted free cash flow and effective income tax rate. The guidance for each metric excludes the same or similar items as those that are excluded from the historical non-GAAP financial measures, as well as significant items that are outside the control of the Company or inherently unusual, non-operating, unpredictable, non-recurring or non-cash in nature. For fiscal year 2022, we have defined the non-GAAP financial measure of adjusted free cash flow as net cash provided by operating activities, excluding other significant unpredictable or non-recurring cash payments or receipts relating to legal settlements, minus capital expenditures. For the three months ended December 31, 2021 adjusted free cash flow of $808.9 million consisted of net cash provided by operating activities of $863.4 million minus capital expenditures of $79.7 million plus legal settlement payments of $25.2 million. The Company does not provide forward looking guidance on a GAAP basis for such metrics because certain financial information, the probable significance of which cannot be determined, is not available and cannot be reasonably estimated. For example, LIFO expense (credit) is largely dependent upon the future inflation or deflation of brand and generic pharmaceuticals, which is out of the Company’s control, and acquisition-related intangibles amortization depends on the timing and amount of future acquisitions, which cannot be reasonably estimated. Similarly, the timing and amount of litigation settlements is unpredictable and non-recurring.
View source version on businesswire.com: https://www.businesswire.com/news/home/20220201006151/en/
Bennett S. Murphy
Senior Vice President, Investor Relations
610-727-3693
[email protected]