Acquisitions and Restructuring - The company acquired PharmaLex Holding Gmbh for €1.381 billion, with an additional €101 million paid due to subsequent acquisitions by PharmaLex[71] - Total acquisition, integration, and restructuring expenses for the three months ended December 31, 2022, were 37.236million,comparedto32.334 million in the same period in 2021[80] - The company plans to change its name to Cencora in the second half of 2023, which will result in additional acquisition-related intangibles amortization expense[108] Financial Performance and Revenue - Revenue increased by 5.4% to 62.85billion,drivenby6.156.24 billion[111][112] - U.S. Healthcare Solutions gross profit rose by 8.4% to 1.39billion,witha5−basispointmarginimprovementto2.466.61 billion, impacted by unfavorable foreign exchange rates and divestiture of Brazil specialty business[111][133] - Gross profit increased by 4.2% to 2.15billion,supportedby49.9 million in antitrust litigation settlement gains[114][115][136] - Total segment operating income for the three months ended December 31, 2022, was 733.698million,withgainsfromantitrustlitigationsettlementscontributing49.899 million[91] - U.S. Healthcare Solutions' operating income increased by 3.3million,or0.6572.4 million, with an operating income margin of 1.02%, a decline of 5 basis points due to increased operating expenses[142] - International Healthcare Solutions' operating income decreased by 10.4% to 161.3million[142]−Totalsegmentoperatingincomedecreasedby2.1733.7 million[142] Operating Expenses and Costs - Total operating expenses increased by 96.9million,or6.81.29 billion, representing 2.05% of revenue[117][140] - LIFO expense of 25.1millionwasrecorded,drivenbyhigherbrandpharmaceuticalinflationandinventorymix[139]LitigationandLiabilities−Thecompany′saccruedlitigationliabilityrelatedtotheDistributorSettlementAgreementwas5.9 billion as of December 31, 2022, with 471.8millionexpectedtobepaidbeforeDecember31,2023[82]ForeignExchangeandInternationalOperations−TheInternationalHealthcareSolutionssegment′soperatingincomedecreasedduetounfavorableforeigncurrencyexchangeratesinthecurrentyearquarter[109]−OperatingincomeinInternationalHealthcareSolutionsdecreasedby10.42.4 billion multi-currency senior unsecured revolving credit facility expiring in October 2027, with interest rates ranging from 80.5 to 122.5 basis points over SOFR/EURIBOR/CDOR/RFR[74] - Net interest expense decreased by 13.8% due to higher interest income from increased investment rates[123] - Net interest expense increased to 46.0million,withaweightedaverageinterestrateof3.215.64 billion, with 3.80billioninadditionalavailabilityundervariable−ratedebtfacilities[155]−Thecompanyhasacommercialpaperprogramwithanaggregateamountofupto2.4 billion, fully backed by the Multi-Currency Revolving Credit Facility, with no borrowings outstanding as of December 31, 2022[156] Tax and Financial Metrics - Effective tax rate decreased to 19.8% from 24.6% due to non-U.S. income taxed at lower rates and stock-related tax benefits[124][130] - Days sales outstanding improved to 27.5 days, and days inventory on hand decreased to 27.4 days[129] Cash Flow and Investments - Cash and cash equivalents held by foreign subsidiaries increased to 830.6millionasofDecember31,2022,from688.4 million as of September 30, 2022[147] - Net income for the period was 476.2million,withpositivenon−cashitemstotaling242.9 million, including 100.3millionindepreciationexpenseand75.1 million in amortization expense[148] - The company expects to invest approximately 500millionincapitalexpendituresduringfiscal2023,focusingontechnologyinitiativesandregulatorycompliance[152]−Netcashusedinfinancingactivitiesincluded807.2 million in purchases of common stock and $99.7 million in cash dividends paid on common stock[153]
