McKesson Corporation · NYSE:MCK
McKesson — Credit Suisse Healthcare Conference 2013
28 slides from McKesson's conference presentation, Nov 12, 2013
Slide 1: McKesson: In Business for Better Health
McKesson: In Business for Better Health Credit Suisse Healthcare Conference John Hammergren Chairman and Chief Executive Officer McKesson Corporation November 12, 2013
Slide 2: Forward-Looking Statements
Forward-Looking Statements Some of the information in this presentation is not historical in nature and may GAAP / Non-GAAP constitute forward-looking statements, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Reconciliation These state
Slide 3: McKesson Overview
McKesson Overview Driving Better Health for 180 years • Headquartered in San Francisco, CA 3 Unless indicated otherwise, presentation reflects results as of FYE13
Slide 4: In Business for Better Health
In Business for Better Health Better Business Better Care We make healthcare We enable better businesses run better clinical outcomes Better Connectivity Providers Payers Pharmacies Manufacturers Consumers 4
Slide 5: McKesson Drives Sustained Value Creation
McKesson Drives Sustained Value Creation Attractive healthcare markets Experienced and • Public policy agenda supports greater tenured management access and improved efficiency team with a steady • Demographics drive long-term demand track record of delivering results Strong balance Well-positioned
Slide 6: We Have a Track Record of Steady Revenue Growth
We Have a Track Record of Steady Revenue Growth… $ Billions $122 $122 $108 $112 $101 $106 $93 FY07 FY08 FY09 FY10 FY11 FY12 FY13 6 Revenues for fiscal years 2007 through 2013 from continuing operations.
Slide 7: Higher Adjusted EPS Growth
…That We Have Leveraged into Higher Adjusted EPS Growth… FY14 Guidance $8.40 - $8.70 $6.28 $6.38 $4.65 $5.13 $4.23 $3.41 $2.81 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 Reflects non-GAAP information calculated on an Adjusted Earnings basis. Reconciliation to GAAP information for fiscal years 2007 thro
Slide 8: Solid First Half Results In Fiscal 2014
… And Solid First Half Results In Fiscal 2014 (In Millions except Adjusted EPS) Six Months Ended September 30, 2013 2012 Chg Revenues Distribution Solutions $ 63,572 $ 58,986 8% Technology Solutions 1,590 1,468 8% $ 65,162 $ 60,454 8% Adjusted Operating Profit Distribution Solutions $ 1,527 $ 1,255
Slide 9: We've Steadily Increased Operating Cash Flow
We’ve Steadily Increased Operating Cash Flow 7 Year Moving Average $2.5 $2.0 OCF $ Billions $1.5 $1.0 $0.5 FY07 FY08* FY09 FY10 FY11 FY12 FY13 9 *FY08 excludes $962 million Securities Litigation payment
Slide 10: Enabling Effective Capital Deployment
…Enabling Effective Capital Deployment $8.8B in Value-Creating FY07 – FY13 $ Billions Acquisitions from FY07 – FY13 $0.9 Dividends PSS World Medical $1.9B Internal Capital • Expanding medical surgical reach and capabilities Spending Drug Trading - Katz $0.9B $2.6 $8.8 • Solidifying market leadership
Slide 11: Expanding Global Reach
Expanding Global Reach Recent Acquisition Announcement 11
Slide 12: Celesio Overview
Celesio Overview More Positive Lives • Founded in 1835 and listed since 1904 • Headquartered in Stuttgart, Germany • Operates in 14 countries • 38,000 employees Financials*: • Extensive network of pharmacies in Europe FY12 Revenue: € 22.3 B • Leading positions as a pharmaceutical distributor in Euro
Slide 13: Expected Transaction Timeline
Expected Transaction Timeline F3Q 2014 F4Q 2014 Fiscal 2015 ending December 31, 2013 ending March 31, 2014 beginning April 1, 2014 • Tender offers launched* • Tender offers conclude • Operational control obtained • McKesson consolidates financial results of Celesio *The tender offers will start only
Slide 14: Creating a Global Healthcare Services Leader
Creating a Global Healthcare Services Leader • 120,000 pharmacy and hospital delivery locations • 11,000+ community pharmacies • 81,500 employees worldwide • $150+ billion in annual revenues 14
Slide 15: Combination Drives Value Creation
Combination Drives Value Creation Accretion • Expected accretion to Adjusted Earnings per share of $1.00 to $1.20 in the first twelve months following the successful completion of the tender offers • Assumes McKesson achieves 100% ownership of the shares of Celesio at the conclusion of the tender of
Slide 16: Creating a Unique Partnership and Bright Future
Creating a Unique Partnership and Bright Future 16
Slide 17: In Business For Better Health
In Business For Better Health 17
Slide 18: McKesson
MCKESSON
Slide 19: Appendix
MSKESSON Appendix BUSINESS CARE CONNECTIVITY ©
Slide 20: Adjusted Earnings (Non-GAAP) Financial Information
Adjusted Earnings(Non-GAAP) Financial Information The Company believes the presentation of non‐GAAP measures such as Adjusted Earnings provides useful supplemental information to investors with regard to its core operating performance, as well as assists with the comparison of its past financial per
Slide 21: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) Reconciliation McKESSON CORPORATION RECONCILIATION OF GAAP OPERATING RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions, except per share amounts) Six Months Ended September 30, 2013 Amortizat
Slide 22: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) Reconciliation McKESSON CORPORATION RECONCILIATION OF GAAP OPERATING RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions, except per share amounts) Year Ended March 31, 2013 (a) Amortization Ac
Slide 23: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) Reconciliation McKESSON CORPORATION RECONCILIATION OF GAAP OPERATING RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions, except per share amounts) Year Ended March 31, 2011 (a) Amortization Ac
Slide 24: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) Reconciliation McKESSON CORPORATION RECONCILIATION OF GAAP OPERATING RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions, except per share amounts) Year Ended March 31, 2009 (a) Amortization Ac
Slide 25: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) Reconciliation McKESSON CORPORATION RECONCILIATION OF GAAP OPERATING RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions, except per share amounts) Year Ended March 31, 2007 (a) Amortization of
Slide 26: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) Reconciliation McKESSON CORPORATION RECONCILIATION OF GAAP SEGMENT FINANCIAL RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions) Six Months Ended September 30, 2013 Six Months Ended September
Slide 27: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) Reconciliation McKESSON CORPORATION RECONCILIATION OF GAAP SEGMENT FINANCIAL RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions) Year Ended March 31, 2012 (a) Year Ended March 31, 2011 (a) Yea
Slide 28: GAAP/Adjusted Earnings (Non-GAAP) Reconciliation
GAAP/Adjusted Earnings (Non-GAAP) Reconciliation McKESSON CORPORATION RECONCILIATION OF GAAP SEGMENT FINANCIAL RESULTS TO ADJUSTED EARNINGS (NON-GAAP) FOR FISCAL 2007 THROUGH SIX MONTHS ENDED SEPTEMBER 30, 2013 (unaudited) (in millions) Year Ended March 31, 2009 (a) Year Ended March 31, 2008 (a) Yea