<PAGE> 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended March 31, 1996 Commission File Number 0-12591
Cardinal Health, Inc.
---------------------
(Exact name of registrant as specified in its charter)
Ohio 31-0958666
---- ----------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
5555 GLENDON COURT, DUBLIN, OHIO 43016
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code (614) 717-5000
655 Metro Place South, Suite 925, Dublin, Ohio 43017
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
----------------- ------------------
The number of Registrant's Common Shares outstanding at April 23, 1996
was as follows:
Common Shares, without par value: 48,680,629
----------
<PAGE> 2
CARDINAL HEALTH, INC. AND SUBSIDIARIES
Index *
<TABLE>
<CAPTION>
Page No.
Part I. Financial Information:
----------------------
Item 1. Financial Statements
<S> <C>
Consolidated Statements of Earnings for the Fiscal Quarter and Nine
Months Ended March 31, 1996 and March 31, 1995..................................... 3
Consolidated Balance Sheets at March 31, 1996 and June 30, 1995.................... 4
Consolidated Statements of Cash Flows for the Nine Months Ended
March 31, 1996 and March 31, 1995.................................................. 5
Notes to Consolidated Financial Statements......................................... 6-8
Item 2. Management's Discussion and Analysis of Results of Operations
and Financial Condition............................................................ 9-10
Part II. Other Information:
------------------
Item 1. Legal Proceedings.................................................................. 11
Item 6. Exhibits and Reports on Form 8-K................................................... 12
<FN>
* Items deleted are inapplicable.
</TABLE>
Page 2
<PAGE> 3
PART I. FINANCIAL INFORMATION
CARDINAL HEALTH, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Fiscal Quarter Ended Nine Months Ended
------------------------------- --------------------------------
March 31, March 31, March 31, March 31,
1996 1995 1996 1995
--------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Net revenues $ 2,202,804 $ 2,001,250 $ 6,381,569 $ 5,832,645
Cost of products sold 2,051,878 1,863,258 5,964,137 5,456,944
--------------- --------------- --------------- ---------------
Gross margin 150,926 137,992 417,432 375,701
Selling, general and administrative expenses 84,117 81,660 254,459 237,842
Unusual item, merger costs (16,374)
--------------- --------------- --------------- ---------------
Operating earnings 66,809 56,332 146,599 137,859
Other income (expense):
Interest expense (6,037) (6,443) (14,278) (14,689)
Other, net-- primarily interest income 1,072 1,041 4,614 3,654
--------------- --------------- --------------- ---------------
Earnings before income taxes 61,844 50,930 136,935 126,824
Provision for income taxes 25,047 20,944 57,932 52,186
--------------- --------------- --------------- ---------------
Net earnings $ 36,797 $ 29,986 $ 79,003 $ 74,638
=============== =============== =============== ===============
Net earnings per Common Share:
Primary $ 0.75 $ 0.61 $ 1.61 $ 1.54
Fully diluted $ 0.75 $ 0.61 $ 1.61 $ 1.54
Weighted average number of
Common Shares outstanding:
Primary 49,157 49,170 49,060 48,478
Fully diluted 49,224 49,178 49,100 48,522
</TABLE>
See notes to consolidated financial statements.
Page 3
<PAGE> 4
CARDINAL HEALTH, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
March 31, June 30,
1996 1995
--------------- ----------------
ASSETS
Current assets:
<S> <C> <C>
Cash and equivalents $ 114,479 $ 42,525
Marketable securities available for sale 15,001 40,695
Trade receivables 560,495 529,672
Merchandise inventories 1,232,641 1,071,811
Prepaid expenses and other 30,855 25,472
--------------- ----------------
Total current assets 1,953,471 1,710,175
--------------- ----------------
Property and equipment, at cost 228,727 183,287
Accumulated depreciation and amortization (98,477) (86,205)
--------------- ----------------
Property and equipment, net 130,250 97,082
Other assets:
Finance notes and accrued interest receivable, net 29,019 27,278
Intangibles and other 87,809 85,141
--------------- ----------------
Total $ 2,200,549 $ 1,919,676
=============== ================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Notes payable, banks $ $ 3,000
Current portion of long-term obligations 101,963 2,083
Accounts payable 1,001,205 952,206
Other accrued liabilities 118,691 116,789
--------------- ----------------
Total current liabilities 1,221,859 1,074,078
--------------- ----------------
Long-term obligations, less current portion 257,943 209,202
Deferred tax and other liabilities 17,422 12,710
Shareholders' equity:
Common Shares, without par value 368,184 360,468
Retained earnings 343,203 270,363
Common Shares in treasury, at cost (4,889) (4,011)
Unamortized restricted stock awards (3,173) (3,134)
--------------- ----------------
Total shareholders' equity 703,325 623,686
--------------- ----------------
Total $ 2,200,549 $ 1,919,676
=============== ================
</TABLE>
See notes to consolidated financial statements.
Page 4
<PAGE> 5
CARDINAL HEALTH, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Nine Months Ended
--------------------------------
March 31, March 31,
1996 1995
--------------- ----------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C>
Net earnings $ 79,003 $ 74,638
Adjustments to reconcile net earnings to net cash from operations:
Depreciation and amortization 19,219 15,890
Provision for bad debts 7,817 6,867
Change in operating assets and liabilities, net of effects from acquisitions:
Increase in trade and finance notes receivable (40,381) (135,800)
Increase in merchandise inventories (160,830) (173,461)
Increase in accounts payable 48,999 68,202
Other operating items, net (8,397) 6,782
--------------- ----------------
Net cash used in operating activities (54,570) (136,882)
--------------- ----------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of subsidiary, net of cash acquired (15,784)
Proceeds from sale of property and equipment 613
Additions to property and equipment (50,285) (22,221)
Purchase of marketable securities available for sale (88,034) (157,428)
Proceeds from sale of marketable securities available for sale 120,846 117,308
--------------- ----------------
Net cash used in investing activities (16,860) (78,125)
--------------- ----------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net short-term borrowing activity (3,000) 92,000
Reduction of long-term obligations (2,462) (3,698)
Proceeds from long-term obligations 150,000
Issuance costs of long-term obligations (1,277)
Proceeds from issuance of Common Shares 2,357 72,304
Tax benefit of stock options 4,500 16,362
Dividends paid on Common shares (6,163) (6,758)
Purchase of treasury shares (571) (3,903)
--------------- ----------------
Net cash provided by financing activities 143,384 166,307
--------------- ----------------
NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS 71,954 (48,700)
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD 42,525 58,053
--------------- ----------------
CASH AND EQUIVALENTS AT END OF PERIOD $ 114,479 $ 9,353
=============== ================
</TABLE>
See notes to consolidated financial statements.
Page 5
<PAGE> 6
CARDINAL HEALTH, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1. The consolidated financial statements of the Company include the
accounts of all majority-owned subsidiaries and all significant
intercompany amounts have been eliminated. The consolidated financial
statements contained herein have been restated to give retroactive
effect to the merger of a wholly-owned subsidiary of the Company with
and into Medicine Shoppe International, Inc. ("Medicine Shoppe"), on
November 13, 1995, which business combination was accounted for under
the pooling-of-interests method (see Note 3).
These consolidated financial statements have been prepared in
accordance with the instructions to Form 10-Q and include all of the
information and disclosures required by generally accepted accounting
principles for interim reporting. In the opinion of management, all
adjustments necessary for a fair presentation have been included. All
such adjustments are of a normal and recurring nature.
The consolidated financial statements included herein should be read
in conjunction with the audited consolidated financial statements and
related notes for the fiscal years ended June 30, 1995, 1994 and March
31, 1993 contained in the Company's report on Form 8-K, dated January
10, 1996. The financial statements contained in the Form 8-K were
restated for the business combination with Medicine Shoppe (see Note
3).
Note 2. Net earnings per Common Share are based on the weighted average
number of Common Shares outstanding during each period and the
dilutive effect of stock options from the date of grant, computed
using the treasury stock method.
Note 3. Effective November 13, 1995, a wholly-owned subsidiary of the
Company was merged with and into Medicine Shoppe. The Medicine Shoppe
merger was accounted for as a pooling-of-interests business
combination. The Company issued 6,425,717 Common Shares to Medicine
Shoppe shareholders. In addition, Medicine Shoppe's outstanding stock
options were converted into options to purchase approximately 121,000
Common Shares.
In the second quarter of fiscal 1996, the Company recorded a
nonrecurring charge to reflect estimated Medicine Shoppe merger costs
of approximately $16.4 million ($11.8 million net of tax), which
includes approximately $6.2 million for anticipated investment
advisor, banking, legal, accounting, and other related transaction
fees and costs associated with the Medicine Shoppe merger and
approximately $10.2 million related to revaluation of certain
operating assets, integrating operations and implementing
efficiencies with regard to information systems, customer systems,
marketing programs and administrative functions.
Certain Medicine Shoppe merger cost amounts are based upon estimates
of costs to be incurred and actual costs may differ from these
estimates. As of March 31, 1996, the Company has incurred gross
Medicine Shoppe merger costs of approximately $6.2 million.
Page 6
<PAGE> 7
The following pro forma results for nine months ended March 31, 1996
are presented excluding the Medicine Shoppe merger costs of
approximately $16.4 million ($11.8 million net of tax). This
information is presented to facilitate meaningful comparisons to
ongoing operations and to other companies (in thousands, except per
share amounts).
<TABLE>
<CAPTION>
Nine Months Ended
----------------------------------------------------------------
Percentage Percentage
March 31, of Net March 31, of Net
1996 Revenues 1995 Revenues
------------------ ------------ ------------------ ------------
<S> <C> <C> <C> <C>
Operating earnings $ 162,973 2.55% $ 137,859 2.36%
Net earnings $ 90,803 1.42% $ 74,638 1.28%
Net earnings per Common Share:
Primary $ 1.85 $ 1.54
Fully diluted $ 1.85 $ 1.54
</TABLE>
The differences between the above results and those reported in the
Consolidated Statements of Earnings are due solely to the assumed
elimination of the Medicine Shoppe merger costs of approximately $16.4
million ($11.8 million net of tax).
Note 4. During the nine months ended March 31, 1996, the Company incurred
costs associated with the Company's February 7, 1994 merger with
Whitmire Distribution Corporation ("Whitmire") of approximately $7.3
million and as of March 31, 1996 had incurred aggregate costs of
approximately $34.2 million. The estimated remaining Whitmire merger
costs to be incurred are approximately $1.7 million at March 31, 1996,
and the Company's current estimates of the Whitmire merger costs
ultimately to be incurred are not materially different than the
amounts originally recorded. The Company anticipates that the
remainder of these costs will be expended during fiscal 1996.
Note 5. On July 1, 1994, the Company acquired all of the outstanding stock
of Humiston-Keeling, Inc., a drug wholesaler based in Calumet City,
Illinois, for cash of $33,334,000 in a transaction accounted for by
the purchase method. Had the purchase occurred at the beginning of
fiscal 1994, operating results on a pro forma basis would not have
been significantly different.
Note 6. On July 18, 1994, the Company issued approximately 944,000 Common
Shares in a merger transaction for all of the common shares of Behrens
Inc. ("Behrens"), a drug wholesaler based in Waco, Texas. The
transaction was accounted for as a pooling-of-interests business
combination. The impact of the Behrens merger, on both an historical
and pro forma basis, is not significant. Accordingly, prior periods
have not been restated for the Behrens merger.
Note 7. On September 26, 1994, 8,050,000 of the Company's Common Shares
were sold pursuant to a public offering. Approximately 1,867,000
Common Shares (the "Issued Shares") were sold by the Company, and
approximately 6,183,000 Common Shares (the "Existing Shares") were
sold by certain shareholders of the Company. Net proceeds received by
the Company from the sale of the Issued Shares of approximately $70
million were used to finance working capital growth and for other
general corporate purposes. The Company did not receive any of the
proceeds from the sale of the Existing Shares.
Note 8. On January 23, 1996, the Company sold $150 million of 6% Notes due
2006 (the "6% Notes") in a public offering. The 6% Notes represent
unsecured obligations of the Company, are not redeemable prior to
maturity and are not subject to a sinking fund. Issuance costs of
approximately $1.3 million incurred in connection with the offering
will be amortized on a straight-line basis over the period the 6%
Notes will be outstanding. The Company plans to use the proceeds of
this sale for general corporate purposes, which may include repayment
of bank lines of credit and other maturing debt, working capital
growth, capital expenditures, and acquisitions.
Page 7
<PAGE> 8
Note 9. On February 7, 1996, the Company announced that it had entered into a
definitive merger agreement with Pyxis Corporation ("Pyxis") pursuant
to which Pyxis will become a wholly-owned subsidiary of the Company
in a stock-for-stock merger intended to be tax-free and accounted for
as a pooling-of-interests for financial reporting purposes. In
connection with the merger, the Company estimates that it will issue
approximately 15.0 million Company Common Shares. Under the terms of
the merger agreement, shareholders of Pyxis will receive 0.406557
Company Common Shares for each share of Pyxis they own at the time
the transaction is consummated. In addition, pursuant to the terms of
the merger agreement, options for Pyxis common stock will be
converted into equivalent options for approximately 1.6 million
Company Common Shares, based upon the exchange ratio. In connection
with the transaction, Pyxis has granted the Company an option to
purchase a number of shares of Pyxis common stock equal to 19.9% of
the number of shares currently outstanding, exercisable upon the
occurrence of certain events. Special meetings of the shareholders of
both the Company and Pyxis were held on April 26, 1996, at which the
transaction was approved.
Page 8
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION
Management's discussion and analysis presented below has been prepared to
give retroactive effect to the pooling-of-interest business combination with
Medicine Shoppe on November 13, 1995 (see Note 3 of "Notes to Consolidated
Financial Statements"). This discussion and analysis is concerned with material
changes in financial condition and results of operations for the Company's
consolidated balance sheets as of March 31, 1996 and June 30, 1995, and for the
consolidated statements of earnings for the three and nine month periods ended
March 31, 1996 and March 31, 1995.
RESULTS OF OPERATIONS
Net Revenues. Net revenues increased 10% for the third quarter of fiscal
1996 and 9% for the nine-month period ended March 31, 1996. The increase in the
third quarter and the nine-month period is primarily due to internal revenue
growth from wholesaling activities, resulting from increased sales to existing
customers and the addition of new customers (primarily in the managed care and
chain sectors) as well as price increases. The revenue growth rate is lower than
historical averages due in large part to unusually high revenue growth rates in
the same periods of the prior year (31% in the third quarter and 38% for the
nine-month period of fiscal 1995) and to the Company's focus on customers that
meet certain performance objectives.
Gross Margin. As a percentage of net revenues, gross margin for the third
quarter decreased slightly to 6.85% from 6.90% for the comparative quarter. For
the nine-month period, gross margin increased to 6.54% from 6.44% in the prior
year. Gross margin was positively affected in both periods by expanded
merchandising and marketing programs with customers and suppliers. Conversely,
gross margin was negatively affected by lower selling margin rates, reflecting a
highly competitive market and a greater mix of high volume customers, where a
lower cost of distribution and better asset management enable the Company to
offer lower selling margins.
Selling, General and Administration Expenses. Selling, general and
administrative expenses as a percentage of net revenues improved to 3.82% and
3.99%, for the three and nine month periods ended March 31, 1996, respectively,
from 4.08% for both of the prior periods. The improvement in the third quarter
reflects the economies associated with the Company's revenue growth, as well as
productivity improvements resulting in part from management information system
enhancements.
Unusual Item - Merger Costs. In the second quarter of fiscal 1996, the
Company recorded a nonrecurring charge to reflect the estimated Medicine Shoppe
merger costs of approximately $16.4 million ($11.8 million, net of tax). See
further discussion in Note 3 of "Notes to Consolidated Financial Statements."
Provision for Income Taxes. The Company's effective tax rate increased for
the nine-months ended March 31, 1996 compared to the prior year due primarily to
certain nondeductible Medicine Shoppe merger costs recorded in the second
quarter of fiscal 1996.
LIQUIDITY AND CAPITAL RESOURCES
Working capital increased to $731.6 million at March 31, 1996 from $636.0
million at June 30, 1995. This increase included additional investments in
merchandise inventories and trade receivables of $160.8 million and $30.8
million, respectively, and a decrease in notes payable, banks of $3.0 million.
Offsetting the increase in working capital were a decrease in marketable
securities available for sale of $25.7 million, and increases in accounts
payable of $49.0 million and the current portion of long-term debt of $99.9
million. The increases in merchandise inventories and accounts payable, as well
as the decreases in marketable securities available for sale and notes payable,
banks reflect the timing of seasonal inventory purchases and the related
payments. The increase in trade receivables primarily reflects the growth of the
Company's net revenues (see "Net Revenues" above) and the increase in direct
deliveries to customer warehouses relative to the timing of cash receipts for
these deliveries. The increase in the current portion of long-term debt is due
to the Company's $100 million 8% notes which are due March, 1997.
Property and equipment, at cost increased by $45.4 million from June 30,
1995. The property acquired included increased investment in management
information systems and customer support systems, as well as the construction
and automation of distribution facilities.
Page 9
<PAGE> 10
Shareholders' equity increased to $703.3 million at March 31, 1996 from
$623.7 million at June 30, 1995 primarily due to net earnings of $79.0 million
during the nine month period ended March 31, 1996.
On January 23, 1996, the Company sold $150 million of 6% Notes, due 2006 in
a public offering. See further discussion in Note 8 of "Notes to Consolidated
Financial Statements." The Company believes that it has adequate capital
resources at its disposal to meet currently anticipated capital expenditures,
routine business growth and expansion, and current and projected debt service.
OTHER
On February 7, 1996, the Company announced that it had entered into a
definitive merger agreement with Pyxis Corporation ("Pyxis") pursuant to which
Pyxis will become a wholly-owned subsidiary of the Company in a stock-for-stock
merger intended to be tax-free and accounted for as a pooling-of-interests for
financial reporting purposes. In connection with the merger, the Company
estimates that it will issue approximately 15.0 million Company Common Shares.
Under the terms of the merger agreement, shareholders of Pyxis will receive
0.406557 Company Common Shares for each share of Pyxis they own at the time the
transaction is consummated. In addition, pursuant to the terms of the merger
agreement, options for Pyxis common stock will be converted into equivalent
options for approximately 1.6 million Company Common Shares, based upon the
exchange ratio. In connection with the transaction, Pyxis has granted the
Company an option to purchase a number of shares of Pyxis common stock equal to
19.9% of the number of shares currently outstanding, exercisable upon the
occurrence of certain events. Special meetings of the shareholders of both the
Company and Pyxis were held on April 26, 1996, at which the transaction was
approved.
Page 10
<PAGE> 11
PART II. OTHER INFORMATION
Item 1: Legal Proceedings
In November 1993, Cardinal and Whitmire were each named as defendants in a
series of purported class action antitrust lawsuits which were later
consolidated and transferred by the Judicial Panel for Multi-District Litigation
to the United States District Court for the Northern District of Illinois (the
"Brand Name Prescription Drug Litigation"). Subsequent to the consolidation, a
new consolidated complaint ("amended complaint") was filed which included
allegations that the wholesaler defendants, including Cardinal and Whitmire,
conspired with manufacturers to inflate prices by using a chargeback pricing
system. Cardinal and Whitmire filed an answer denying the allegations in the
amended complaint. In addition to the federal court case described above,
Whitmire has been named as a defendant in a series of state court cases alleging
similar claims under various state laws regarding the sale of brand name
prescription drugs.
Effective October 26, 1994, the Company entered into a Judgment Sharing
Agreement in the Brand Name Prescription Drug Litigation with other wholesaler
and pharmaceutical manufacturer defendants. Under the Judgment Sharing
Agreement: (a) the manufacturer defendants agreed to reimburse the wholesaler
defendants for litigation costs incurred, up to an aggregate of $9 million; and
(b) if a judgment is entered against both manufacturers and wholesalers, the
total exposure for joint and several liability of the Company is limited to the
lesser of 1% of such judgment or one million dollars. In addition, the Company
has released any claims which it might have had against the manufacturers for
the claims presented by the plaintiffs in the Brand Name Prescription Drug
Litigation. The Judgment Sharing Agreement covers the federal court litigation
as well as the cases which have been filed in various state courts. On December
15, 1994, the plaintiffs filed a motion to declare the Judgment Sharing
Agreement unenforceable. On April 10, 1995, the court denied that motion and
ruled that the Judgment Sharing Agreement is valid and enforceable. The
plaintiffs filed a motion for reconsideration of the court's April 10, 1995
ruling, and the court denied that motion and reaffirmed its earlier decision on
April 24, 1995.
On November 9, 1995, the Company along with the other wholesaler defendants
filed a motion for summary judgment in the Brand Name Prescription Drug
Litigation. On April 4, 1996, summary judgment was granted in favor of the
Company and the other wholesaler defendants. The plaintiffs have indicated that
they plan to appeal this decision.
The Company believes that both federal and state allegations against
Cardinal and Whitmire are without merit, and it intends to contest such
allegations vigorously. The Company does not believe that the outcome of these
lawsuits will have a material adverse effect on the Company's financial
condition or results of operations.
Cardinal, Pyxis (which has entered into a merger agreement and a stock
option agreement with Cardinal) and the directors of Pyxis have been named as
defendants in four purported class action lawsuits (the "Stockholder Actions")
filed in connection with the proposed merger of Pyxis with a wholly-owned
subsidiary of Cardinal in the Court of Chancery, County of New Castle, State of
Delaware. The Stockholder Actions allege that the defendants breached their
fiduciary duties to the public stockholders of Pyxis: by agreeing to sell Pyxis
at an unfair and inadequate price; by agreeing to the granting of the option
with respect to Pyxis common shares pursuant to Pyxis' stock option agreement
with Cardinal, which is alleged to preclude any superior proposal for the
acquisition of Pyxis; by agreeing to an allegedly unfair exchange ratio; and by
agreeing to the proposed merger without having conducted an "auction process or
active market check." Each of the Stockholder Actions is brought on behalf of a
purported class of persons consisting of the stockholders of Pyxis, other than
defendants. As relief, the Stockholder Actions seek, among other things, an
order enjoining consummation of the proposed merger, or, in the event it is
consummated, rescission of the merger, and an award of "rescissory and/or
compensatory damages" in an unspecified amount. The Company believes that the
complaints in the Stockholder Actions are without merit.
The Company also becomes involved from time to time in ordinary routine
litigation incidental to its business, none of which is expected to have any
material adverse effect on the Company's financial condition or results of
operations.
Page 11
<PAGE> 12
Item 6: Exhibits and Reports on Form 8-K:
(a) Listing of Exhibits:
Exhibit 2.01 Agreement and Plan of Merger, dated as of February 7,
1996, by and among the Registrant, Aztec Merger Corp.
and Pyxis Corporation (1)
Exhibit 4.01 Indenture between the Registrant and Bank One,
Indianapolis, NA relating to the Registrant's 6 1/2%
Notes due 2004 and 6% Notes due 2006. (2)
Exhibit 11.01 Computation of Per Share Earnings.
Exhibit 27.01 Financial Data Schedule.
--------------------------
(1) Included as an exhibit to the Registrant's Schedule 13D
reporting Registrant's beneficial ownership of shares of
Pyxis Corporation (No. 5-43690) and incorporated herein by
reference.
(2) Included as an exhibit to the Registrant's Quarterly Report on
Form 10-Q for the quarter ended March 31, 1994 (No. 0-12591) and
incorporated herein by reference. The referenced Indenture was
entered into prior to the quarter for which this Form 10-Q is
being filed. However, during the quarter ended March 31, 1996, the
Company issued 6% Notes due 2006 pursuant to the terms of such
Indenture.
(b) Reports on Form 8-K:
On January 11, 1996 the Company filed a report on Form 8-K, under Item
5, announcing that it was filing under Item 7 restated supplemental
consolidated financial statements pursuant to Part I, Item 11 (b)(iii)
of Form S-3 in conjunction with the Company's shelf registration
statements previously filed on Form S-3 (file No. 33-57223 and No.
33-62198).
Page 12
<PAGE> 13
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CARDINAL HEALTH, INC.
Date: April 29, 1996 By: /s/ Robert D. Walter
--------------------
Robert D. Walter
Chairman and Chief Executive Officer
By: /s/ David Bearman
--------------------
David Bearman
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer and
Principal Accounting Officer)
Page 13
<PAGE> 1
Exhibit 11.01
CARDINAL HEALTH, INC.
COMPUTATION OF PER SHARE EARNINGS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Fiscal Quarter Ended Nine Months Ended
------------------------------- --------------------------------
March 31, March 31, March 31, March 31,
1996 1995 1996 1995
--------------- --------------- --------------- ---------------
PRIMARY:
<S> <C> <C> <C> <C>
Net earnings $ 36,797 $ 29,986 $ 79,003 $ 74,638
=============== =============== =============== ===============
Average shares outstanding 48,663 48,254 48,568 47,309
Dilutive effect of stock options 494 916 492 1,169
--------------- --------------- --------------- ---------------
Weighted average number of Common
Shares outstanding 49,157 49,170 49,060 48,478
=============== =============== =============== ===============
Primary earnings per Common Share $ 0.75 $ 0.61 $ 1.61 $ 1.54
=============== =============== =============== ===============
FULLY DILUTED:
Net earnings $ 36,797 $ 29,986 $ 79,003 $ 74,638
=============== =============== =============== ===============
Average shares outstanding 48,663 48,254 48,568 47,309
Dilutive effect of stock options 561 924 532 1,213
--------------- --------------- --------------- ---------------
Weighted average number of Common
Shares outstanding 49,224 49,178 49,100 48,522
=============== =============== =============== ===============
Fully diluted earnings per Common Share $ 0.75 $ 0.61 $ 1.61 $ 1.54
=============== =============== =============== ===============
</TABLE>
Page 14
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1996
<PERIOD-START> JUL-01-1995
<PERIOD-END> MAR-31-1996
<CASH> 114,479
<SECURITIES> 15,001
<RECEIVABLES> 592,486
<ALLOWANCES> (39,923)
<INVENTORY> 1,232,641
<CURRENT-ASSETS> 1,953,471
<PP&E> 228,727
<DEPRECIATION> (98,477)
<TOTAL-ASSETS> 2,200,549
<CURRENT-LIABILITIES> 1,221,859
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<COMMON> 368,184
0
0
<OTHER-SE> 335,141
<TOTAL-LIABILITY-AND-EQUITY> 2,200,549
<SALES> 6,381,569
<TOTAL-REVENUES> 6,381,569
<CGS> 5,964,137
<TOTAL-COSTS> 5,964,137
<OTHER-EXPENSES> 254,459
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<INTEREST-EXPENSE> (14,278)
<INCOME-PRETAX> 136,935
<INCOME-TAX> 57,932
<INCOME-CONTINUING> 79,003
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<EXTRAORDINARY> 0
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<NET-INCOME> 79,003
<EPS-PRIMARY> 1.61
<EPS-DILUTED> 1.61
</TABLE>
