(By Balaseshan) Cardinal Health Inc. (NYSE:CAH) reported a 14% increase in quarterly earnings on strong segments growth despite flat revenue. Despite results exceeding Street's expectations, the company guided full year 2013 earnings outlook below Street.
Profit from continuing operations grew 14% to $236 million for the fourth quarter. Adjusted earnings from continuing operations rose to $255 million or $0.73 per share from $214 million or $0.60 per share.
Revenue remained flat at $26.76 billion. Analysts, on average, had expected a profit of $0.72 per share on revenue of $27.25 billion for the fourth quarter.
Revenue for the Pharmaceutical segment declined 1% to $24.3 billion, primarily due to brand-to-generic conversions. Segment profit grew 15% to $354 million, on strong performance of generic programs and the benefits of expanded business with new and existing customers.
Revenue for the Medical segment increased 5% to $2.4 billion. Segment profit rose 2% to $79 million, primarily driven by increased sales of preferred products, offset by expenses related to the new systems implementation.
Return on equity rose to 15.1% from 14.1%, while adjusted return on equity increased to 16.3% from 14.9%. Net debt to capital for the quarter remained unchanged at 9%.
Looking ahead into the fiscal 2013, the company expects adjusted earnings from continuing operations of $3.35 to $3.50 per share, while Street predicts $3.55 per share. The outlook incorporates the previously announced non-renewal of the Express Scripts (NASDAQ:ESRX) contract.
CAH closed Wednesday's regular session down 1.30% at $42.53. The stock has been trading between $37.53 and $46.23 for the past 52 weeks.