Cencora(COR) - 2024 Q4 - Annual Results

Revenue and Earnings - Revenue for the fourth quarter of fiscal 2024 was $79.1 billion, a 14.7% year-over-year increase, with U.S. Healthcare Solutions revenue increasing by 15.7% and International Healthcare Solutions revenue increasing by 5.5%[4][19][20] - For fiscal year 2024, revenue reached $294.0 billion, reflecting a 12.1% year-over-year increase, while GAAP diluted EPS decreased to $7.53 from $8.53 in the prior fiscal year[21][22] - Adjusted diluted EPS for the fourth quarter was $3.34, a 16.8% increase compared to $2.86 in the previous fiscal year fourth quarter[16] - Total revenue for the fiscal year ended September 30, 2024, was $293,958,599, representing a 12.1% increase from the previous year[37] - U.S. Healthcare Solutions revenue reached $265,339,427, a 13.0% increase from $234,759,218 year-over-year[51] - International Healthcare Solutions revenue grew by 4.4% to $28,627,542, compared to $27,418,679 in the prior year[51] Operating Income and Expenses - Adjusted operating income for the fourth quarter was $851.1 million, a 6.3% increase compared to the same period in the prior fiscal year[14] - Operating expenses in the fourth quarter increased by 33.2% to $2.4 billion, primarily due to a $418 million goodwill impairment charge related to PharmaLex[6][21] - U.S. Healthcare Solutions segment operating income was $697.4 million, up 10.2% year-over-year, while International Healthcare Solutions segment operating income decreased by 8.6% to $153.7 million[19][20] - Operating income for fiscal 2024 was $3.6 billion, with a negative impact from foreign currency translation of $38.8 million, resulting in constant currency operating income of $3.7 billion[67] - The company achieved an operating income of $2,175,249 for the fiscal year, down 7.1% from $2,340,731 in the previous year[52] Cash Flow and Capital Expenditures - Adjusted free cash flow for the fiscal year ended September 30, 2024, was $3,064.3 million, consisting of net cash from operating activities of $3,484.7 million minus capital expenditures of $487.2 million[66] - Net cash provided by operating activities was $3,484,685 thousand for the fiscal year ended September 2024, down from $3,911,334 thousand in the previous year, a decrease of 10.9%[54] - The company reported capital expenditures of $487,173 thousand, an increase from $458,359 thousand in the previous year, indicating a rise of 6.1%[54] - Net cash used in investing activities was $618,096 thousand, significantly lower than $2,602,465 thousand in the previous year, showing a decrease of 76.3%[54] Guidance and Future Projections - Cencora's fiscal year 2025 financial guidance includes adjusted operating income growth of 5% to 6.5% and adjusted diluted EPS growth of 8% to 10%[27] - Expected revenue growth for fiscal year 2025 is projected to be in the range of 7% to 9%[27] - Adjusted diluted earnings per share is anticipated to be between $14.80 and $15.10[27] - Cencora's fiscal 2025 guidance does not currently include the impact of the RCA acquisition, which will be incorporated after the transaction closes[29] - The company provided non-GAAP fiscal year 2025 guidance for diluted earnings per share, operating income, effective income tax rate, and free cash flow, excluding significant items outside its control[68] Tax and Impairment Charges - The effective tax rate for the fourth quarter was 94.0%, significantly higher than the prior year quarter's 21.8%, primarily due to the PharmaLex goodwill impairment[9][21] - For the fiscal year ended September 30, 2024, the company reported a goodwill impairment charge of $418 million related to PharmaLex[39] - The fiscal year ended September 30, 2024, includes $263.1 million in litigation accruals, partially offset by a $92.2 million reduction in opioid settlement accruals[38] Acquisitions and Strategic Initiatives - Cencora announced the acquisition of Retina Consultants of America, enhancing its specialty healthcare capabilities[2][24] - The company anticipates continued market expansion and product development as part of its strategic initiatives moving forward[42] Assets and Liabilities - Total assets increased to $67,101,667 thousand as of September 2024, up from $62,558,746 thousand in September 2023, representing a growth of approximately 8.7%[53] - Total current liabilities increased to $54,277,053 thousand, up from $48,831,198 thousand, reflecting a rise of approximately 11.1%[53] - Long-term debt decreased to $3,811,745 thousand from $4,146,113 thousand, a reduction of approximately 8.1%[53] - Total equity increased to $786,742 thousand as of September 2024, compared to $666,287 thousand in September 2023, reflecting a growth of approximately 18.1%[53] Other Financial Metrics - Diluted weighted average shares outstanding for the fourth quarter were 198.1 million, a decrease of 2.6% compared to the prior fiscal year fourth quarter due to share repurchases[10][17] - The company reported a gain of $40.7 million from the divestiture of non-core businesses in the fiscal year ended September 30, 2023[39] - The company incurred $227,070 thousand in litigation and opioid-related expenses for the fiscal year ended September 30, 2024[45] - The company faced a goodwill impairment of $418,000 during the fiscal year, which was not present in the previous year[52] - Cash and cash equivalents rose to $3,132,648 thousand in September 2024, compared to $2,592,051 thousand in September 2023, marking an increase of 20.9%[55] - The company’s cash, cash equivalents, and restricted cash at the end of the fiscal year totaled $3,297,880 thousand, up from $2,752,889 thousand, an increase of 19.8%[55]