Cencora(US:COR) ZACKSยท2024-11-06 17:25Core Viewpoint - Cencora, Inc. reported strong fourth-quarter fiscal 2024 results with adjusted earnings per share (EPS) of $3.34, exceeding estimates and showing year-over-year growth, despite a significant decline in GAAP EPS due to increased operating expenses and goodwill impairment charges [1][2][13]. Revenue and Financial Performance - Revenues for the fourth quarter reached $79.1 billion, reflecting a 14.7% increase year over year and surpassing consensus estimates by 1.8% [3]. - For fiscal 2024, total revenues amounted to $294 billion, up 12.1% year over year, with adjusted EPS improving 14.8% to $13.76 [4]. Segmental Analysis - U.S. Healthcare Solutions: Revenues in this segment were $71.7 billion, a 15.7% increase year over year, driven by market growth and increased sales of GLP-1 drugs and specialty products [5]. - International Healthcare Solutions: This segment generated revenues of $7.4 billion, up 5.5% year over year, with operating income declining due to higher IT expenses and lower income from Canada, partially offset by gains in global specialty logistics [7]. Margin Analysis - Adjusted gross profit was $2.5 billion, a 6.6% increase year over year, with an adjusted gross margin of 3.1%, down 24 basis points from the previous year [8]. - Adjusted operating income rose to $851.1 million, up 6.3% year over year, with an adjusted operating margin of 1.1%, contracting 8 basis points [8]. Financial Update - Cencora ended the fiscal fourth quarter with cash and cash equivalents of $3.13 billion, down from $3.31 billion in the prior quarter [9]. - Cumulative net cash from operating activities totaled $3.48 billion, compared to $3.91 billion a year ago [10]. Dividend Update - The board declared a quarterly dividend of 55 cents per share, a 7.8% increase from the previous rate of 51 cents, payable on November 29, 2024 [10]. FY25 Guidance - The company projects adjusted EPS for fiscal 2025 to be between $14.80 and $15.10, indicating growth of 8-10% from the prior year, with revenues expected to rise 7-9% [11]. - Adjusted operating income is anticipated to improve by 5-6.5% for fiscal 2025 [12]. Strategic Developments - Cencora announced a definitive agreement to acquire Retina Consultants of America, enhancing its position in the healthcare sector [15]. - The company continues to face challenges with gross margins due to lower-margin products and rising operational expenses amid competitive pressures [16].