After losing its business with Walgreens ($WBA) a few years back, drug wholesaler Cardinal Health ($CAH) has taken steps to beef up its operations and those keep paying off. The company today reported both Q4 and year-end numbers with enough growth in sales and profits to feel good about raising its projections for fiscal 2016.
The Dublin, OH-based company reported Q4 revenues of $27.5 billion, up 20%, and non-GAAP diluted earnings per share (EPS) from continuing operations of $1, also a 20% jump. For the fiscal year, the numbers were revenues up 13% to $102.5 billion, and non-GAAP diluted EPS from continuing operations up 14% to $4.38.
"It was also a year of meaningful strategic initiatives," said CEO George Barrett in the earnings release. That included a generic drug sourcing program it created with CVS Health ($CVS) and its $1.1 billion deal announced last month to buy The Harvard Drug Group, which specializes in sales of generics and over-the-counter products.
Cardinal has said The Harvard Drug Group will give a boost to its telesales capabilities, expand its OTC portfolio and provide it with some specialized packaging operations for hospital systems and other institutions. It is also projecting that the operation, which has about $450 million a year in sales, could provide it with earnings bump of $0.15 per share in fiscal 2016.
Toward that end, Cardinal today said it now expects fiscal 2016 earnings to be in the range of $4.85 to $5.05.
The Harvard deal was the second for the company this year which in March said it would pump up its device product line with a $1.9 billion deal to buy Johnson & Johnson's ($JNJ) Cordis vascular device unit. The pharma industry has been consolidating around the world in the last few years, as wholesalers look to have enough size to leverage better deals from drug and device makers as payers getting tougher on prices.
- here's the release