McKesson earnings slip in Q4, FY09

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McKesson has reported that while revenues for its fourth quarter, which ended March 31, were flat at $26.2 billion compared with a year ago, its net income for the fourth quarter and the 2009 fiscal year fell.

Fourth quarter earnings were impacted by a non-cash, pre-tax impairment charge of $63 million ($60 million after-tax), according to the San Fransisco-based company. The charge, recorded within its distribution solutions segment, is primarily related to its 39 percent equity investment in Parata Systems. Overall, its net income for the 2009 fourth quarter was $281 million, representing an 8 percent drop from the year-ago quarter.

For the 2009 fiscal year, the company booked a net income of $823 million, compared $990 million in 2008, representing an 18 percent McKesson had revenues of $106.6 billion versus $101.7 billion a year ago, which was impacted by a pre-tax charge in the third fiscal quarter of $493 million ($311 million after-tax) for the AWP litigation.

"This quarter, we implemented additional cost control actions across the company in response to the economic environment. With these actions, operating expenses were flat for the quarter," said John H. Hammergren, chairman and CEO of McKesson.

"In the fourth quarter, we resumed share repurchases, although we did so in a measured way that reflects the more challenging economic and financial market climate," Hammergren commented.