McKesson(MCK) - 2025 Q1 - Quarterly Results

Financial Performance - Consolidated revenues for the first quarter were $79.3 billion, an increase of 6% compared to the previous year[1] - Adjusted Earnings per Diluted Share for the first quarter was $7.88, reflecting an 8% increase from $7.27 in the prior year[4] - The company raised its fiscal 2025 Adjusted Earnings per Diluted Share guidance to a range of $31.75 to $32.55, indicating a growth of 16% to 19% compared to the prior year[2] - Revenues for the three months ended June 2024 were $79,283 million, a 6% increase from $74,483 million in the same period last year[20] - Gross profit increased by 4% to $3,152 million compared to $3,022 million in the prior year[20] - Adjusted earnings per diluted share increased by 8% to $7.88 from $7.27[23] - Adjusted gross profit for the three months ended June 2024 was $3,060 million, a 4% increase from $2,936 million in the same period last year[26] - Total revenues for the quarter reached $79,283 million, reflecting a 6% increase from $74,483 million year-over-year[29] - Net income for the quarter was $960 million, a decrease from $997 million in the prior year[33] Segment Performance - The U.S. Pharmaceutical segment generated revenues of $71.7 billion, a 7% increase driven by higher prescription volumes, including specialty products and GLP-1 medications[7] - The Medical-Surgical Solutions segment reported revenues of $2.6 billion, a 1% increase, despite challenges in customer mix and product demand shifts[9] - The International segment achieved revenues of $3.7 billion, a 6% increase, attributed to higher pharmaceutical distribution volumes in Canada[10] - U.S. Pharmaceutical revenues increased by 7% to $71,715 million compared to $67,160 million in the previous year[29] - Operating profit for U.S. Pharmaceutical segment was $781 million, down 6% from $827 million in the same quarter last year[29] - The Prescription Technology Solutions segment's revenues were flat at $1.2 billion, impacted by lower contributions from third-party logistics[8] Shareholder Returns - The Board approved a 15% increase in the quarterly dividend to $0.71 per share, marking the eighth consecutive year of dividend increases[1] - The company returned $609 million to shareholders in the first quarter, including $527 million in stock repurchases and $82 million in dividends[5] - Dividends declared per common share increased by 15% to $0.62 from $0.54[20] Cash Flow and Expenses - McKesson's cash from operations for the first three months was $1.4 billion, resulting in negative Free Cash Flow of $1.5 billion due to capital expenditures[5] - Total operating expenses rose by 10% to $2,123 million, up from $1,922 million[20] - Net cash used in operating activities for the three months ended June 30, 2024, was $(1,380) million, an increase of 31% compared to $(1,052) million in the same period of 2023[35] - Free Cash Flow (Non-GAAP) for the three months ended June 30, 2024, was $(1,547) million, reflecting a 32% increase from $(1,176) million in the same period of 2023[35] - Cash and cash equivalents decreased to $2,302 million from $4,583 million at the end of the previous quarter[32] Assets and Liabilities - Total assets increased to $71,670 million from $67,443 million at the end of the previous quarter[32] - Total current liabilities rose to $56,434 million from $52,357 million in the previous quarter[32] - The company’s long-term debt remained stable at $5,584 million, slightly up from $5,579 million[32] Other Financial Metrics - Net income attributable to McKesson Corporation decreased by 4% to $915 million from $958 million year-over-year[20] - Diluted earnings per share remained stable at $7.00, compared to $7.02 in the previous year[20] - Other income increased significantly by 242% to $130 million from $38 million[20] - Interest expense increased by 60% to $75 million compared to $47 million in the prior year[20] - The company recognized a pre-tax net gain of $97 million related to a recapitalization event of one of its investments in equity securities[39] Charges and Expenditures - Claims and litigation charges for the three months ended June 30, 2024, included pre-tax charges of $114 million related to opioid-related claims[38] - Restructuring, impairment, and related charges for the three months ended June 30, 2024, amounted to $10 million, down from $52 million in the same period of 2023[37] - Payments for property, plant, and equipment increased by 36%, from $(78) million in 2023 to $(106) million in 2024[35] - Capitalized software expenditures rose by 33%, from $(46) million in 2023 to $(61) million in 2024[35]