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Cardinal Health reports Q3 revenue of $21.4 billion

BY Michael Johnsen

DUBLIN, Ohio — Cardinal Health on Thursday reported fiscal year 2014 third-quarter revenue of $21.4 billion and non-GAAP diluted earnings per share from continuing operations of $1.01. Non-GAAP operating earnings decreased 3% to $561 million, reflecting the continuing impact of the previously announced Walgreens contract expiration.

"Our organization delivered a solid third quarter to our fiscal 2014, completing a first nine months of strong financial performance and excellent progress on our strategic initiatives," stated George Barrett, chairman and CEO of Cardinal Health. "During the recent period, we strengthened our medical preferred products program with the announcement of the acquisition of AccessClosure and enhanced our specialty solutions capabilities with the acquisition of Sonexus Health."

Revenue for the Pharmaceutical segment declined 15% to $18.8 billion, and segment profit decreased 9% to $452 million. The decline in both segment revenue and profit was the result of the impact of the expiration of the Walgreens contract. The decline in segment revenue was partially offset by sales growth from new and existing customers, and the decline in segment profit was partially offset by strong performance from generic programs.

Cardinal Health confirmed that the joint venture with CVS Caremark announced in December 2013, which will form the largest generic sourcing entity in the U.S., remains on track to be operational as soon as July 1, 2014. The U.S.-based joint venture will operate under the name Red Oak Sourcing and will be located in Foxborough, Mass.

The company announced an agreement to acquire AccessClosure, a leading manufacturer and distributor of extravascular closure devices in the U.S., expanding the Cardinal Health portfolio of preferred products that meets industry’s increasing demand for high-quality, cost-efficient solutions. And Cardinal Health enhanced its integrated services for biopharmaceutical manufacturers by acquiring privately held Sonexus Health, which offers a broad range of patient access, support and specialty commercialization services.

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Jean Coutu Group ‘satisfied’ with Q4

BY Antoinette Alexander

LONQUEUIL, Quebec — Canadian pharmacy retailer Jean Coutu Group posted a lift in fourth-quarter revenues and net profits, demonstrating a “solid performance” in a highly competitive retail environment, the company stated on Wednesday.

“We are satisfied with the results of the fourth quarter and fiscal 2014 that demonstrate the solid performance of our organization despite a highly competitive environment. Our efficiency in implementing our business plan, together with our employees and the pharmacist owners affiliated to the Jean Coutu network, contributed to affirm our leadership,” stated Francois Coutu, president and CEO. “During the upcoming year, we expect to continue expanding our network and implement dynamic strategies to ensure the evolution of our offer and favor retail sales growth.”

Revenues during the quarter totaled Canadian $685.4 million compared with C$682.7 million in the year-ago period.

During fiscal year 2014, revenues totaled C$2.733 billion compared with C$2.74 billion in the year-ago period, a decrease of 0.2%. This decrease is due to the deflationary impact on revenues of the volume increase in prescriptions of generic drugs compared with brand name drugs as well as the price reductions of generic drugs, the company stated.

Net profit during the quarter totaled C$57.5 million, or 30 Canadian cents per share, compared with C$53.5 million, or 25 Canadian cents per share, in the year-ago period.

During fiscal year 2014, net profit was C$437 million, or C$2.12 per share, compared with C$558.2 million, or C$2.57 per share, in the year-ago period. The company attributed the decrease to gains of C$212.7 million related to the investment in Rite Aid recognized during fiscal year 2014 compared with C$348 million for fiscal year 2013.

In looking at the performance of its PJC network of franchised stores, retail sales increased 0.2% during the quarter on a same-store basis. Pharmacy same-store sales decreased 0.1% and front-end same-store sales decreased 0.2%.

During fiscal 2014, same-store sales decreased 0.1%. Pharmacy same-store sales decreased 0.5% and front-end same-store sales increased 0.1%.

 

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Revlon sees ‘mixed’ Q1 results

BY Antoinette Alexander

NEW YORK — While posting a “strong” first quarter, Revlon did see mixed dynamics for the consumer and professional segment, said Lorenzo Delpani, president and CEO.

The company reported on Wednesday that net sales, on a GAAP as reported basis, were $469.8 million versus $325.9 million in the year-ago period. Results reflect the inclusion of net sales of brands acquired from the Colomer Group in the first quarter.

Income from continuing operations were (net of taxes) $8.7 million, or 17 cents per share, compared with a loss of $4.5 million (net of taxes), or 8 cents per share, in the year-ago period.

In looking at the consumer segment, it was essentially flat as a result of market softness, while the professional segment had one of its best quarters ever, said Delpani during the company’s conference call on Wednesday.

“It’s worth noting that the consumer segment, albeit flat, benefited from a favorable return adjustment as we are reducing the quantity of new product launches. This is the result of the implementation of our fewer, bigger, better innovation strategy. Our strategy focus on more quality and less quantity of innovation and, therefore, we should see a lower level of returns going forward,” Delpani said.

The consumer segment, which posted sales of $339.5 million during the quarter, includes the results of retail brands acquired in the TCG acquisition, which represented $15.5 million of net sales in the first quarter.

In the United States, net sales were $250.2 million compared with $232 million of pro forma U.S. net sales in the first quarter of 2013, an increase of 7.8%. Higher net sales of CND Shellac and American Crew products during the quarter contributed to the increase.

 

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