McKesson posts strong Q4, fiscal year results
McKesson delivered solid results for the fourth-quarter and full-year. Total revenue for the quarter was $58.5 billion, an increase of 12% over the prior-year period. Total revenue for fiscal year 2020 was $231.1 billion, an increase of 8% over the prior-fiscal year, which the company attributed to growth in the U.S. pharmaceutical and specialty solutions segment, largely due to branded pharmaceutical price increases and higher volumes from retail national account customers.
Earnings per diluted share for Q4 increased to $5.82 and earnings per diluted share for the full-year increased were $4.99.
“McKesson delivered a strong finish to fiscal 2020, reflecting continued momentum in the business and meaningful progress in our transformation towards becoming a more focused organization as we look to capture future growth opportunities,” said Brian Tyler, McKesson CEO. “During fiscal 2020, we achieved adjusted operating profit growth in all three operating segments, generated $3.9 billion of free cash flow, and successfully completed the exit of our investment in Change Healthcare.”
Tyler added, “As we enter fiscal 2021, McKesson is leveraging our expertise, leadership and scale to play a critical role in the fight against the COVID-19 pandemic. We continue to remain focused on supporting our people, our customers and our communities during this challenging time. I want to thank caregivers worldwide for their heroic efforts and acknowledge the entire McKesson team, particularly our frontline workers, for their extraordinary dedication. Despite the uncertainties in the near term macro environment, we remain confident in the resiliency of our business model and committed to creating long-term shareholder value.”
The company’s pharmaceutical and specialty solutions segment saw revenue up 13% over Q4 2019, totaling $46.3 billion. The company said the increase was driven primarily by branded pharmaceutical price increases and higher volumes from retail national account customers, partially offset by branded to generic conversions. For the full-year, the segment saw revenue up 9% over the prior fiscal year, totaling $183.3 billion. The company said the increase was driven primarily by the same factors that contributed to growth in this segment for Q4.
The company’s medical-surgical solutions segment saw revenue up 13% over Q4 2019, totaling $2.2 billion. McKesson said the increase was driven primarily by growth in its primary care business, due to higher pharmaceutical volumes and a stronger influenza season. The segment saw full year revenue up 9%, totaling $8.3 billion. The company attributed the increase to growth in its primary care business.
As a result of "anticipated headwinds in fiscal 2021 as a result of the COVID-19 pandemic and a continuation of disciplined, efficient capital deployment, including investments in the business," the company said it expects full-year 2021 adjusted earnings of $13.95 to $14.75 per share.