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|
Delaware
|
|
23-3079390
|
(State or other jurisdiction of
|
|
(I.R.S. Employer
|
incorporation or organization)
|
|
Identification No.)
|
|
|
|
1300 Morris Drive, Chesterbrook, PA
|
|
19087-5594
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
|
Page No.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands, except share and per share data)
|
|
June 30,
2016 |
|
September 30,
2015 |
||||
|
|
(Unaudited)
|
|
|
||||
ASSETS
|
|
|
|
|
|
|
||
Current assets:
|
|
|
|
|
|
|
||
Cash and cash equivalents
|
|
$
|
1,865,202
|
|
|
$
|
2,167,442
|
|
Accounts receivable, less allowances for returns and doubtful accounts:
$909,533 at June 30, 2016 and $899,764 at September 30, 2015
|
|
8,984,533
|
|
|
8,222,951
|
|
||
Merchandise inventories
|
|
10,492,561
|
|
|
9,755,094
|
|
||
Prepaid expenses and other
|
|
114,959
|
|
|
189,001
|
|
||
Total current assets
|
|
21,457,255
|
|
|
20,334,488
|
|
||
|
|
|
|
|
||||
Property and equipment, at cost:
|
|
|
|
|
|
|
||
Land
|
|
40,300
|
|
|
39,499
|
|
||
Buildings and improvements
|
|
485,634
|
|
|
413,854
|
|
||
Machinery, equipment and other
|
|
1,693,849
|
|
|
1,449,545
|
|
||
Total property and equipment
|
|
2,219,783
|
|
|
1,902,898
|
|
||
Less accumulated depreciation
|
|
(1,054,120
|
)
|
|
(923,647
|
)
|
||
Property and equipment, net
|
|
1,165,663
|
|
|
979,251
|
|
||
|
|
|
|
|
||||
Goodwill and other intangible assets
|
|
8,986,106
|
|
|
6,123,944
|
|
||
Other assets
|
|
305,219
|
|
|
298,474
|
|
||
|
|
|
|
|
||||
TOTAL ASSETS
|
|
$
|
31,914,243
|
|
|
$
|
27,736,157
|
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
||
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
|
|
||
Accounts payable
|
|
$
|
22,692,064
|
|
|
$
|
20,886,439
|
|
Accrued expenses and other
|
|
692,011
|
|
|
679,309
|
|
||
Short-term debt
|
|
613,180
|
|
|
—
|
|
||
Total current liabilities
|
|
23,997,255
|
|
|
21,565,748
|
|
||
|
|
|
|
|
||||
Long-term debt
|
|
3,794,036
|
|
|
3,493,048
|
|
||
Deferred income taxes
|
|
2,121,331
|
|
|
1,954,205
|
|
||
Other liabilities
|
|
122,304
|
|
|
89,636
|
|
||
|
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
|
|
|
||
Common stock, $0.01 par value - authorized: 600,000,000 shares; issued and outstanding:
276,977,072 shares and 214,646,806 shares at June 30, 2016, respectively,
and 274,991,824 shares and 206,891,873 shares at September 30, 2015, respectively
|
|
2,770
|
|
|
2,750
|
|
||
Additional paid-in capital
|
|
4,063,724
|
|
|
3,736,477
|
|
||
Retained earnings
|
|
2,250,868
|
|
|
1,181,623
|
|
||
Accumulated other comprehensive loss
|
|
(110,978
|
)
|
|
(136,333
|
)
|
||
Treasury stock, at cost: 62,330,266 shares at June 30, 2016 and 68,099,951 shares at September 30, 2015
|
|
(4,327,067
|
)
|
|
(4,150,997
|
)
|
||
Total stockholders’ equity
|
|
1,879,317
|
|
|
633,520
|
|
||
|
|
|
|
|
||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
$
|
31,914,243
|
|
|
$
|
27,736,157
|
|
|
|
Three months ended
June 30, |
|
Nine months ended
June 30, |
||||||||||||
(in thousands, except per share data)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Revenue
|
|
$
|
36,881,680
|
|
|
$
|
34,233,556
|
|
|
$
|
109,289,083
|
|
|
$
|
100,491,425
|
|
Cost of goods sold
|
|
35,773,817
|
|
|
33,342,092
|
|
|
106,141,012
|
|
|
97,935,686
|
|
||||
Gross profit
|
|
1,107,863
|
|
|
891,464
|
|
|
3,148,071
|
|
|
2,555,739
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Distribution, selling and administrative
|
|
520,032
|
|
|
502,744
|
|
|
1,571,088
|
|
|
1,361,678
|
|
||||
Depreciation
|
|
52,419
|
|
|
48,283
|
|
|
153,232
|
|
|
137,755
|
|
||||
Amortization
|
|
40,268
|
|
|
20,147
|
|
|
112,205
|
|
|
36,177
|
|
||||
Warrants
|
|
(83,704
|
)
|
|
(14,900
|
)
|
|
(120,275
|
)
|
|
1,109,211
|
|
||||
Employee severance, litigation and other
|
|
52,234
|
|
|
2,625
|
|
|
88,719
|
|
|
30,999
|
|
||||
Pension settlement
|
|
—
|
|
|
—
|
|
|
47,607
|
|
|
—
|
|
||||
Operating income (loss)
|
|
526,614
|
|
|
332,565
|
|
|
1,295,495
|
|
|
(120,081
|
)
|
||||
Other (income) loss
|
|
(2,158
|
)
|
|
(1,534
|
)
|
|
(3,224
|
)
|
|
11,185
|
|
||||
Interest expense, net
|
|
32,115
|
|
|
29,793
|
|
|
96,107
|
|
|
70,081
|
|
||||
Income (loss) from operations before income taxes
|
|
496,657
|
|
|
304,306
|
|
|
1,202,612
|
|
|
(201,347
|
)
|
||||
Income tax expense (benefit)
|
|
146,854
|
|
|
90,143
|
|
|
(81,703
|
)
|
|
297,827
|
|
||||
Net income (loss)
|
|
$
|
349,803
|
|
|
$
|
214,163
|
|
|
$
|
1,284,315
|
|
|
$
|
(499,174
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
|
$
|
1.62
|
|
|
$
|
0.98
|
|
|
$
|
6.12
|
|
|
$
|
(2.27
|
)
|
Diluted
|
|
$
|
1.56
|
|
|
$
|
0.89
|
|
|
$
|
5.69
|
|
|
$
|
(2.27
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
|
215,688
|
|
|
219,359
|
|
|
209,898
|
|
|
219,689
|
|
||||
Diluted
|
|
224,802
|
|
|
240,236
|
|
|
225,646
|
|
|
219,689
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Cash dividends declared per share of common stock
|
|
$
|
0.34
|
|
|
$
|
0.29
|
|
|
$
|
1.02
|
|
|
$
|
0.87
|
|
|
|
Three months ended
June 30, |
|
Nine months ended
June 30, |
||||||||||||
(in thousands)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net income (loss)
|
|
$
|
349,803
|
|
|
$
|
214,163
|
|
|
$
|
1,284,315
|
|
|
$
|
(499,174
|
)
|
Other comprehensive (loss) income
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net change in foreign currency translation adjustments
|
|
(8,911
|
)
|
|
6,712
|
|
|
(5,434
|
)
|
|
(20,126
|
)
|
||||
Pension plan adjustment, net of tax of $19,054
|
|
—
|
|
|
—
|
|
|
31,538
|
|
|
—
|
|
||||
Other
|
|
117
|
|
|
(133
|
)
|
|
(749
|
)
|
|
3,166
|
|
||||
Total other comprehensive (loss) income
|
|
(8,794
|
)
|
|
6,579
|
|
|
25,355
|
|
|
(16,960
|
)
|
||||
Total comprehensive income (loss)
|
|
$
|
341,009
|
|
|
$
|
220,742
|
|
|
$
|
1,309,670
|
|
|
$
|
(516,134
|
)
|
|
|
Nine months ended June 30,
|
||||||
(in thousands)
|
|
2016
|
|
2015
|
||||
OPERATING ACTIVITIES
|
|
|
|
|
|
|
||
Net income (loss)
|
|
$
|
1,284,315
|
|
|
$
|
(499,174
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
|
|
|
||
Depreciation, including amounts charged to cost of goods sold
|
|
167,124
|
|
|
137,870
|
|
||
Amortization, including amounts charged to interest expense
|
|
116,931
|
|
|
39,943
|
|
||
Provision (benefit) for doubtful accounts
|
|
11,310
|
|
|
(3,482
|
)
|
||
Benefit for deferred income taxes
|
|
(219,535
|
)
|
|
(15,799
|
)
|
||
Warrants (income) expense
|
|
(120,275
|
)
|
|
1,109,211
|
|
||
Share-based compensation
|
|
56,561
|
|
|
46,496
|
|
||
Pension settlement
|
|
47,607
|
|
|
—
|
|
||
Loss on sale of business
|
|
—
|
|
|
9,128
|
|
||
Other
|
|
(6,446
|
)
|
|
(9,322
|
)
|
||
Changes in operating assets and liabilities, excluding the effects of acquisitions and divestitures:
|
|
|
|
|
|
|
||
Accounts receivable
|
|
(705,462
|
)
|
|
(868,708
|
)
|
||
Merchandise inventories
|
|
(675,582
|
)
|
|
(700,331
|
)
|
||
Prepaid expenses and other assets
|
|
35,270
|
|
|
(16,008
|
)
|
||
Accounts payable, accrued expenses, and income taxes
|
|
1,812,329
|
|
|
3,530,780
|
|
||
Other liabilities
|
|
17,811
|
|
|
(339
|
)
|
||
NET CASH PROVIDED BY OPERATING ACTIVITIES
|
|
1,821,958
|
|
|
2,760,265
|
|
||
INVESTING ACTIVITIES
|
|
|
|
|
|
|
||
Capital expenditures
|
|
(310,178
|
)
|
|
(157,089
|
)
|
||
Cost of acquired companies, net of cash acquired
|
|
(2,731,356
|
)
|
|
(2,606,524
|
)
|
||
Cost of equity investments
|
|
(19,034
|
)
|
|
—
|
|
||
Proceeds from sale of business
|
|
—
|
|
|
17,184
|
|
||
Proceeds from sale of investment securities available-for-sale
|
|
101,829
|
|
|
—
|
|
||
Purchases of investment securities available-for-sale
|
|
(41,136
|
)
|
|
—
|
|
||
Other
|
|
(21,186
|
)
|
|
1,790
|
|
||
NET CASH USED IN INVESTING ACTIVITIES
|
|
(3,021,061
|
)
|
|
(2,744,639
|
)
|
||
FINANCING ACTIVITIES
|
|
|
|
|
|
|
||
Term loan and senior note borrowings
|
|
1,000,000
|
|
|
1,996,390
|
|
||
Term loan repayments
|
|
(600,000
|
)
|
|
(250,000
|
)
|
||
Borrowings under revolving and securitization credit facilities
|
|
8,788,432
|
|
|
75,542
|
|
||
Repayments under revolving and securitization credit facilities
|
|
(8,273,610
|
)
|
|
(68,641
|
)
|
||
Purchases of common stock
|
|
(1,023,149
|
)
|
|
(800,299
|
)
|
||
Exercises of warrants
|
|
1,168,891
|
|
|
—
|
|
||
Exercises of stock options, including excess tax benefits of $21,853 and $82,345 in fiscal 2016 and 2015, respectively
|
|
73,356
|
|
|
178,146
|
|
||
Cash dividends on common stock
|
|
(215,070
|
)
|
|
(192,054
|
)
|
||
Purchases of call options
|
|
—
|
|
|
(180,000
|
)
|
||
Debt issuance costs and other
|
|
(21,987
|
)
|
|
(28,040
|
)
|
||
NET CASH PROVIDED BY FINANCING ACTIVITIES
|
|
896,863
|
|
|
731,044
|
|
||
(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS
|
|
(302,240
|
)
|
|
746,670
|
|
||
Cash and cash equivalents at beginning of period
|
|
2,167,442
|
|
|
1,808,513
|
|
||
CASH AND CASH EQUIVALENTS AT END OF PERIOD
|
|
$
|
1,865,202
|
|
|
$
|
2,555,183
|
|
|
Pharmaceutical
Distribution
|
|
Other
|
|
Total
|
||||||
Goodwill at September 30, 2015
|
$
|
2,418,806
|
|
|
$
|
1,712,019
|
|
|
$
|
4,130,825
|
|
Goodwill recognized in connection with acquisitions
|
1,832,114
|
|
|
18,195
|
|
|
1,850,309
|
|
|||
Foreign currency translation
|
—
|
|
|
(2,354
|
)
|
|
(2,354
|
)
|
|||
Goodwill at June 30, 2016
|
$
|
4,250,920
|
|
|
$
|
1,727,860
|
|
|
$
|
5,978,780
|
|
|
June 30, 2016
|
|
September 30, 2015
|
||||||||||||||||||||
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||||||||
Indefinite-lived intangibles - trade names
|
$
|
685,020
|
|
|
$
|
—
|
|
|
$
|
685,020
|
|
|
$
|
684,966
|
|
|
$
|
—
|
|
|
$
|
684,966
|
|
Finite-lived intangibles: Customer relationships
|
2,322,887
|
|
|
(240,222
|
)
|
|
2,082,665
|
|
|
1,421,230
|
|
|
(146,227
|
)
|
|
1,275,003
|
|
||||||
Trade names and other
|
305,981
|
|
|
(66,340
|
)
|
|
239,641
|
|
|
81,241
|
|
|
(48,091
|
)
|
|
33,150
|
|
||||||
Total other intangible assets
|
$
|
3,313,888
|
|
|
$
|
(306,562
|
)
|
|
$
|
3,007,326
|
|
|
$
|
2,187,437
|
|
|
$
|
(194,318
|
)
|
|
$
|
1,993,119
|
|
|
June 30,
2016 |
|
September 30,
2015 |
||||
Revolving credit note
|
$
|
—
|
|
|
$
|
—
|
|
Receivables securitization facility due 2018
|
500,000
|
|
|
—
|
|
||
Term loans due in 2020
|
900,000
|
|
|
500,000
|
|
||
Multi-currency revolving credit facility due 2020
|
—
|
|
|
—
|
|
||
Overdraft facility due in 2021
|
13,360
|
|
|
—
|
|
||
$600,000, 1.15% senior notes due 2017
|
599,820
|
|
|
599,658
|
|
||
$400,000, 4.875% senior notes due 2019
|
398,718
|
|
|
398,456
|
|
||
$500,000, 3.50% senior notes due 2021
|
499,621
|
|
|
499,568
|
|
||
$500,000, 3.40% senior notes due 2024
|
498,884
|
|
|
498,777
|
|
||
$500,000, 3.25% senior notes due 2025
|
497,704
|
|
|
497,503
|
|
||
$500,000, 4.25% senior notes due 2045
|
499,109
|
|
|
499,086
|
|
||
Total debt
|
$
|
4,407,216
|
|
|
$
|
3,493,048
|
|
Less current portion
|
613,180
|
|
|
—
|
|
||
Total, net of current portion
|
$
|
3,794,036
|
|
|
$
|
3,493,048
|
|
(in thousands)
|
|
|
Warrants Exercisable
|
22,697
|
|
|
|
|
Shares repurchased under special share repurchase program through June 30, 2016
|
10,447
|
|
Shares expected to be repurchased under remaining Capped Calls
|
13,620
|
|
Total repurchases
|
24,067
|
|
|
|
|
Warrants Coverage
|
106
|
%
|
|
|
Three months ended
June 30, |
|
Nine months ended
June 30, |
||||||||
(in thousands)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||
Weighted average common shares outstanding - basic
|
|
215,688
|
|
|
219,359
|
|
|
209,898
|
|
|
219,689
|
|
Dilutive effect of stock options, restricted stock, and restricted stock units
|
|
3,042
|
|
|
4,878
|
|
|
3,440
|
|
|
—
|
|
Dilutive effect of Warrants
|
|
6,072
|
|
|
15,999
|
|
|
12,308
|
|
|
—
|
|
Weighted average common shares outstanding - diluted
|
|
224,802
|
|
|
240,236
|
|
|
225,646
|
|
|
219,689
|
|
|
Revenue
|
||||||||||||||
|
Three months ended
June 30, |
|
Nine months ended
June 30, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Pharmaceutical Distribution
|
$
|
35,373,725
|
|
|
$
|
32,758,828
|
|
|
$
|
104,734,137
|
|
|
$
|
97,504,075
|
|
Other
|
1,576,368
|
|
|
1,532,907
|
|
|
4,753,988
|
|
|
3,214,977
|
|
||||
Intersegment eliminations
|
(68,413
|
)
|
|
(58,179
|
)
|
|
(199,042
|
)
|
|
(227,627
|
)
|
||||
Revenue
|
$
|
36,881,680
|
|
|
$
|
34,233,556
|
|
|
$
|
109,289,083
|
|
|
$
|
100,491,425
|
|
|
Segment Operating Income
|
||||||||||||||
|
Three months ended
June 30, |
|
Nine months ended
June 30, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Pharmaceutical Distribution
|
$
|
410,718
|
|
|
$
|
377,771
|
|
|
$
|
1,288,672
|
|
|
$
|
1,256,747
|
|
Other
|
82,511
|
|
|
77,372
|
|
|
272,032
|
|
|
186,688
|
|
||||
Total segment operating income
|
$
|
493,229
|
|
|
$
|
455,143
|
|
|
$
|
1,560,704
|
|
|
$
|
1,443,435
|
|
|
Income (Loss) From
Operations Before Income Taxes
|
||||||||||||||
|
Three months ended
June 30, |
|
Nine months ended
June 30, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Total segment operating income
|
$
|
493,229
|
|
|
$
|
455,143
|
|
|
$
|
1,560,704
|
|
|
$
|
1,443,435
|
|
Gain from antitrust litigation settlements
|
120,960
|
|
|
43,567
|
|
|
133,758
|
|
|
65,050
|
|
||||
LIFO expense
|
(80,364
|
)
|
|
(158,710
|
)
|
|
(274,305
|
)
|
|
(453,878
|
)
|
||||
Acquisition-related intangibles amortization
|
(38,681
|
)
|
|
(19,710
|
)
|
|
(108,611
|
)
|
|
(34,478
|
)
|
||||
Warrants income (expense)
|
83,704
|
|
|
14,900
|
|
|
120,275
|
|
|
(1,109,211
|
)
|
||||
Employee severance, litigation and other
|
(52,234
|
)
|
|
(2,625
|
)
|
|
(88,719
|
)
|
|
(30,999
|
)
|
||||
Pension settlement
|
—
|
|
|
—
|
|
|
(47,607
|
)
|
|
—
|
|
||||
Operating income (loss)
|
526,614
|
|
|
332,565
|
|
|
1,295,495
|
|
|
(120,081
|
)
|
||||
Other (income) loss
|
(2,158
|
)
|
|
(1,534
|
)
|
|
(3,224
|
)
|
|
11,185
|
|
||||
Interest expense, net
|
32,115
|
|
|
29,793
|
|
|
96,107
|
|
|
70,081
|
|
||||
Income (loss) from operations before income taxes
|
$
|
496,657
|
|
|
$
|
304,306
|
|
|
$
|
1,202,612
|
|
|
$
|
(201,347
|
)
|
•
|
Revenue
increased
7.7%
and
8.8%
from the prior year quarter and
nine
month period, respectively, as a result of ABDC’s increased sales of brand and generic products, and the strong revenue growth of ABSG. The addition of MWI, which was acquired in February 2015, also contributed to the revenue growth in the current year nine month period;
|
•
|
Pharmaceutical Distribution gross profit
increased
6.5%
and
4.3%
from the prior year quarter and
nine
month period, respectively, as the result of the contribution from our recent PharMEDium acquisition, and segment revenue growth. Gross profit growth in the current year quarter was adversely impacted by the early renewal of our contract with a significant group purchasing organization (“GPO”) customer at less favorable terms. Gross profit growth in the current year
nine
month period benefited from the incremental income from ABDC's participation in the WBA global sourcing arrangement and was adversely impacted by lower generic price appreciation and contract renewals with the Department of Defense (“DOD”) and a significant GPO customer at less favorable terms;
|
•
|
Total gross profit
increased
24.3%
in the current year quarter primarily due to the reduction of LIFO expense, which was
$80.4 million
in the current year quarter in comparison to
$158.7 million
in the prior year quarter and an increased gain from antitrust litigation settlements, which was
$121.0 million
in the current year quarter in comparison to
$43.6 million
in the prior year quarter. Total gross profit
increased
23.2%
in the current year
nine
month period primarily due to the addition of MWI, a reduction in LIFO expense, which was
$274.3 million
in the current year
nine
month period, in comparison to
$453.9 million
in the prior year
nine
month period, and an increased gain from antitrust litigation settlements, which was
$133.8 million
in the current year
nine
month period, in comparison to
$65.1 million
in the prior year
nine
month period;
|
•
|
Distribution, selling, and administrative expenses
increased
3.4%
compared to the prior year quarter, primarily due to our November 2015 acquisition of PharMEDium and
15.4%
compared to the prior year
nine
month period, primarily due to the addition of MWI, and to a lesser extent, PharMEDium, and to support our revenue growth;
|
•
|
Total operating expenses were impacted by Warrants. Warrants income was
$83.7 million
in the current year quarter and
$14.9 million
in the prior year quarter. Warrants income was
$120.3 million
in the current year
nine
month period compared to Warrants expense of
$1,109.2 million
in the prior year
nine
month period. Warrants income in the current year quarter increased primarily due to the decline in our stock price during the quarter ended
June 30, 2016
. Warrants expense decreased significantly from the prior year nine month period primarily due to the decline in our stock price since June 30, 2015. We also incurred a pension settlement charge during the
nine
month period ended
June 30, 2016
in connection with the settlement of our salaried defined benefit pension plan. In addition, depreciation and amortization expense
increased
$24.3 million
and
$91.5 million
from the prior year quarter and
nine
month period, respectively;
|
•
|
Total segment operating income
increased
by
8.4%
compared to the prior year quarter primarily due to the addition of PharMEDium, and
8.1%
compared to the prior year
nine
month period, primarily due to the additions of MWI and PharMEDium; and
|
•
|
Income taxes were an expense of
$146.9 million
and a benefit of
$81.7 million
in the current year quarter and
nine
month period, respectively, as compared to an expense of
$90.1 million
and
$297.8 million
in the prior year quarter and
nine
month period, respectively. In November 2015, we received a private letter ruling from the Internal Revenue Service, which entitles us to an income tax deduction equal to the fair value of the Warrants at the date of exercise. As a result, we recognized a tax benefit adjustment of approximately $456 million, which represented the estimated benefit from the tax deduction for the increase in the value of the Warrants from the issuance date through September 30, 2015. This tax benefit adjustment had a significant impact to our effective tax rate in the
nine
month period ended
June 30, 2016
. Our income tax rate has also been favorably impacted in fiscal 2016 due to the growth of our international service offerings.
|
|
|
Three months ended
June 30, |
|
|
|
Nine months ended
June 30, |
|
|
||||||||||||||
(dollars in thousands)
|
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||
Pharmaceutical Distribution
|
|
$
|
35,373,725
|
|
|
$
|
32,758,828
|
|
|
8.0
|
%
|
|
$
|
104,734,137
|
|
|
$
|
97,504,075
|
|
|
7.4
|
%
|
Other
|
|
1,576,368
|
|
|
1,532,907
|
|
|
2.8
|
%
|
|
4,753,988
|
|
|
3,214,977
|
|
|
47.9
|
%
|
||||
Intersegment eliminations
|
|
(68,413
|
)
|
|
(58,179
|
)
|
|
17.6
|
%
|
|
(199,042
|
)
|
|
(227,627
|
)
|
|
(12.6
|
)%
|
||||
Revenue
|
|
$
|
36,881,680
|
|
|
$
|
34,233,556
|
|
|
7.7
|
%
|
|
$
|
109,289,083
|
|
|
$
|
100,491,425
|
|
|
8.8
|
%
|
|
|
Three months ended
June 30, |
|
|
|
Nine months ended
June 30, |
|
|
||||||||||||||
(dollars in thousands)
|
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||
Pharmaceutical Distribution
|
|
$
|
794,424
|
|
|
745,866
|
|
|
6.5
|
%
|
|
2,448,601
|
|
|
2,347,070
|
|
|
4.3
|
%
|
|||
Other
|
|
272,843
|
|
|
260,741
|
|
|
4.6
|
%
|
|
840,017
|
|
|
597,497
|
|
|
40.6
|
%
|
||||
Gain from antitrust litigation settlements
|
|
120,960
|
|
|
43,567
|
|
|
|
|
|
133,758
|
|
|
65,050
|
|
|
|
|
||||
LIFO expense
|
|
(80,364
|
)
|
|
(158,710
|
)
|
|
|
|
|
(274,305
|
)
|
|
(453,878
|
)
|
|
|
|
||||
Gross profit
|
|
$
|
1,107,863
|
|
|
$
|
891,464
|
|
|
24.3
|
%
|
|
$
|
3,148,071
|
|
|
$
|
2,555,739
|
|
|
23.2
|
%
|
|
|
Three months ended
June 30, |
|
|
|
Nine months ended
June 30, |
|
|
||||||||||||||
(dollars in thousands)
|
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||
Distribution, selling and administrative
|
|
$
|
520,032
|
|
|
$
|
502,744
|
|
|
3.4
|
%
|
|
$
|
1,571,088
|
|
|
$
|
1,361,678
|
|
|
15.4
|
%
|
Depreciation and amortization
|
|
92,687
|
|
|
68,430
|
|
|
35.4
|
%
|
|
265,437
|
|
|
173,932
|
|
|
52.6
|
%
|
||||
Warrants (income) expense
|
|
(83,704
|
)
|
|
(14,900
|
)
|
|
|
|
|
(120,275
|
)
|
|
1,109,211
|
|
|
|
|
||||
Employee severance, litigation and other
|
|
52,234
|
|
|
2,625
|
|
|
|
|
|
88,719
|
|
|
30,999
|
|
|
|
|
||||
Pension settlement charge
|
|
—
|
|
|
—
|
|
|
|
|
|
47,607
|
|
|
—
|
|
|
|
|
||||
Total operating expenses
|
|
$
|
581,249
|
|
|
$
|
558,899
|
|
|
|
|
|
$
|
1,852,576
|
|
|
$
|
2,675,820
|
|
|
|
|
|
|
Three months ended
June 30, |
|
|
|
Nine months ended
June 30, |
|
|
||||||||||||||
(dollars in thousands)
|
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||
Pharmaceutical Distribution
|
|
$
|
410,718
|
|
|
$
|
377,771
|
|
|
8.7
|
%
|
|
$
|
1,288,672
|
|
|
$
|
1,256,747
|
|
|
2.5
|
%
|
Other
|
|
82,511
|
|
|
77,372
|
|
|
6.6
|
%
|
|
272,032
|
|
|
186,688
|
|
|
45.7
|
%
|
||||
Total segment operating income
|
|
493,229
|
|
|
455,143
|
|
|
8.4
|
%
|
|
1,560,704
|
|
|
1,443,435
|
|
|
8.1
|
%
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Gain from antitrust litigation settlements
|
|
120,960
|
|
|
43,567
|
|
|
|
|
|
133,758
|
|
|
65,050
|
|
|
|
|
||||
LIFO expense
|
|
(80,364
|
)
|
|
(158,710
|
)
|
|
|
|
|
(274,305
|
)
|
|
(453,878
|
)
|
|
|
|
||||
Acquisition-related intangibles amortization
|
|
(38,681
|
)
|
|
(19,710
|
)
|
|
|
|
|
(108,611
|
)
|
|
(34,478
|
)
|
|
|
|
||||
Warrants income (expense)
|
|
83,704
|
|
|
14,900
|
|
|
|
|
|
120,275
|
|
|
(1,109,211
|
)
|
|
|
|
||||
Employee severance, litigation and other
|
|
(52,234
|
)
|
|
(2,625
|
)
|
|
|
|
|
(88,719
|
)
|
|
(30,999
|
)
|
|
|
|
||||
Pension settlement
|
|
—
|
|
|
—
|
|
|
|
|
|
(47,607
|
)
|
|
—
|
|
|
|
|
||||
Operating income (loss)
|
|
$
|
526,614
|
|
|
$
|
332,565
|
|
|
|
|
|
$
|
1,295,495
|
|
|
$
|
(120,081
|
)
|
|
|
|
|
2016
|
|
2015
|
||||||||||
|
Amount
|
|
Weighted Average
Interest Rate
|
|
Amount
|
|
Weighted Average
Interest Rate
|
||||||
Interest expense
|
$
|
33,640
|
|
|
2.71
|
%
|
|
$
|
30,654
|
|
|
2.78
|
%
|
Interest income
|
(1,525
|
)
|
|
0.50
|
%
|
|
(861
|
)
|
|
0.16
|
%
|
||
Interest expense, net
|
$
|
32,115
|
|
|
|
|
|
$
|
29,793
|
|
|
|
|
|
2016
|
|
2015
|
||||||||||
|
Amount
|
|
Weighted
Average
Interest Rate
|
|
Amount
|
|
Weighted
Average
Interest Rate
|
||||||
Interest expense
|
$
|
99,086
|
|
|
2.71
|
%
|
|
$
|
71,919
|
|
|
2.89
|
%
|
Interest income
|
(2,979
|
)
|
|
0.46
|
%
|
|
(1,838
|
)
|
|
0.17
|
%
|
||
Interest expense, net
|
$
|
96,107
|
|
|
|
|
|
$
|
70,081
|
|
|
|
|
|
Outstanding
Balance
|
|
Additional
Availability
|
||||
Fixed-Rate Debt:
|
|
|
|
|
|
||
$600,000, 1.15% senior notes due 2017
|
$
|
599,820
|
|
|
$
|
—
|
|
$400,000, 4.875% senior notes due 2019
|
398,718
|
|
|
—
|
|
||
$500,000, 3.50% senior notes due 2021
|
499,621
|
|
|
—
|
|
||
$500,000, 3.40% senior notes due 2024
|
498,884
|
|
|
—
|
|
||
$500,000, 3.25% senior notes due 2025
|
497,704
|
|
|
—
|
|
||
$500,000, 4.25% senior notes due 2045
|
499,109
|
|
|
—
|
|
||
Total fixed-rate debt
|
2,993,856
|
|
|
—
|
|
||
|
|
|
|
||||
Variable-Rate Debt:
|
|
|
|
|
|
||
Revolving credit note
|
—
|
|
|
75,000
|
|
||
Receivables securitization facility due 2018
|
500,000
|
|
|
950,000
|
|
||
Term loans due in 2020
|
900,000
|
|
|
—
|
|
||
Multi-currency revolving credit facility due 2020
|
—
|
|
|
1,400,000
|
|
||
Overdraft facility due in 2021 (£30,000)
|
13,360
|
|
|
26,579
|
|
||
Total variable-rate debt
|
1,413,360
|
|
|
2,451,579
|
|
||
Total debt
|
$
|
4,407,216
|
|
|
$
|
2,451,579
|
|
(in thousands)
|
|
|
Warrants Exercisable
|
22,697
|
|
|
|
|
Shares repurchased under special share repurchase program through June 30, 2016
|
10,447
|
|
Shares expected to be repurchased under remaining Capped Calls
|
13,620
|
|
Total repurchases
|
24,067
|
|
|
|
|
Warrants Coverage
|
106
|
%
|
|
Payments Due by Period
|
||||||||||||||||||
|
Total
|
|
Within 1
Year
|
|
1-3 Years
|
|
4-5 Years
|
|
After 5
Years
|
||||||||||
Debt, including interest payments
|
$
|
5,559,905
|
|
|
$
|
732,555
|
|
|
$
|
720,786
|
|
|
$
|
1,471,814
|
|
|
$
|
2,634,750
|
|
Operating leases
|
519,387
|
|
|
84,660
|
|
|
156,691
|
|
|
113,703
|
|
|
164,333
|
|
|||||
Other commitments
|
97,029
|
|
|
64,611
|
|
|
29,909
|
|
|
2,509
|
|
|
—
|
|
|||||
Total
|
$
|
6,176,321
|
|
|
$
|
881,826
|
|
|
$
|
907,386
|
|
|
$
|
1,588,026
|
|
|
$
|
2,799,083
|
|
|
Three months ended
June 30, |
|
Nine months ended
June 30, |
||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||
Days sales outstanding
|
21.6
|
|
|
20.5
|
|
|
21.4
|
|
|
19.8
|
|
Days inventory on hand
|
29.8
|
|
|
29.6
|
|
|
30.2
|
|
|
30.0
|
|
Days payable outstanding
|
57.7
|
|
|
54.0
|
|
|
56.7
|
|
|
51.4
|
|
Period
|
|
Total
Number of
Shares
Purchased
|
|
Average Price
Paid per
Share
|
|
Total Number of
Shares Purchased
as Part of Publicly
Announced
Programs
|
|
Approximate Dollar
Value of
Shares that May Yet Be
Purchased
Under the Programs
|
||||||
April 1 to April 30
|
|
8,431,508
|
|
|
$
|
54.54
|
|
|
8,431,508
|
|
|
$
|
1,630,408,114
|
|
May 1 to May 31
|
|
1,368,588
|
|
|
$
|
75.28
|
|
|
1,360,807
|
|
|
$
|
2,103,533,257
|
|
June 1 to June 30
|
|
10,671
|
|
|
$
|
73.63
|
|
|
10,149
|
|
|
$
|
2,102,787,504
|
|
Total
|
|
9,810,767
|
|
|
|
|
|
9,802,464
|
|
|
|
|
10.1
|
Tenth Amendment to Amended and Restated Receivables Purchase Agreement, dated as of June 21, 2016, among AmeriSource Receivables Financial Corporation, as seller, AmerisourceBergen Drug Corporation, as servicer, the Purchaser Agents and Purchasers party thereto,Working Capital Management Co., LP, as assignor, Advantage Asset Securitization Corp., Mizuho Bank, Ltd., as assignee, and The Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch, as administrator (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on June 23, 2016).
|
|
|
10.2
|
Fifth Amendment to Receivables Sale Agreement, dated as of June 21, 2016, among AmeriSource Receivables Financial Corporation, as buyer, and AmerisourceBergen Drug Corporation, as originator (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed on June 23, 2016).
|
|
|
10.3
|
Employment Agreement, dated as of May 20, 2016, between the Registrant and Kathy H. Gaddes.
|
|
|
10.4
|
Employment Agreement, dated as of May 20, 2016, between the Registrant and Sun Park.
|
|
|
31.1
|
Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.
|
|
|
31.2
|
Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer.
|
|
|
32
|
Section 1350 Certifications of Chief Executive Officer and Chief Financial Officer.
|
|
|
101
|
Financial statements from the Quarterly Report on Form 10-Q of AmerisourceBergen Corporation for the quarter ended June 30, 2016, formatted in Extensible Business Reporting Language (XBRL): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Cash Flows, and (v) the Notes to Consolidated Statements.
|
|
AMERISOURCEBERGEN CORPORATION
|
|
|
August 2, 2016
|
/s/ Steven H. Collis
|
|
Steven H. Collis
|
|
President and Chief Executive Officer
|
|
|
August 2, 2016
|
/s/ Tim G. Guttman
|
|
Tim G. Guttman
|
|
Executive Vice President
|
|
and Chief Financial Officer
|
Exhibit
|
|
|
Number
|
|
Description
|
|
|
|
10.1
|
|
Tenth Amendment to Amended and Restated Receivables Purchase Agreement, dated as of June 21, 2016, among AmeriSource Receivables Financial Corporation, as seller, AmerisourceBergen Drug Corporation, as servicer, the Purchaser Agents and Purchasers party thereto,Working Capital Management Co., LP, as assignor, Advantage Asset Securitization Corp., Mizuho Bank, Ltd., as assignee, and The Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch, as administrator (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on June 23, 2016).
|
|
|
|
10.2
|
|
Fifth Amendment to Receivables Sale Agreement, dated as of June 21, 2016, among AmeriSource Receivables Financial Corporation, as buyer, and AmerisourceBergen Drug Corporation, as originator (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed on June 23, 2016).
|
|
|
|
10.3
|
|
Employment Agreement, dated May 20, 2016, between the Registrant and Kathy H. Gaddes.
|
|
|
|
10.4
|
|
Employment Agreement, dated May 20, 2016, between the Registrant and Sun Park.
|
|
|
|
31.1
|
|
Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.
|
|
|
|
31.2
|
|
Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer.
|
|
|
|
32
|
|
Section 1350 Certifications of Chief Executive Officer and Chief Financial Officer.
|
|
|
|
101
|
|
Financial statements from the Quarterly Report on Form 10-Q of AmerisourceBergen Corporation for the quarter ended June 30, 2016, formatted in Extensible Business Reporting Language (XBRL): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Cash Flows, and (v) the Notes to Consolidated Statements.
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q (the “Report”) of AmerisourceBergen Corporation (the “Registrant”);
|
2.
|
Based on my knowledge, this Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this Report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this Report;
|
4.
|
The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Report based on such evaluation; and
|
(d)
|
Disclosed in this Report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and
|
5.
|
The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors:
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q (the “Report”) of AmerisourceBergen Corporation (the “Registrant”);
|
2.
|
Based on my knowledge, this Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this Report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this Report;
|
4.
|
The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Report based on such evaluation; and
|
(d)
|
Disclosed in this Report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and
|
5.
|
The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors:
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.
|
No information found
* THE VALUE IS THE MARKET VALUE AS OF THE LAST DAY OF THE QUARTER FOR WHICH THE 13F WAS FILED.
FUND | NUMBER OF SHARES | VALUE ($) | PUT OR CALL |
---|
DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
---|
No information found
No Customers Found
Price
Yield
Owner | Position | Direct Shares | Indirect Shares |
---|