http://www.morningstar.com/earnings/21728052-cardinal-health-inc-cah-q2-2011.aspx

Cardinal Health Inc CAH
Q2 2011 Earnings Call Transcript

Transcript Call Date 02/03/2011

Operator: Good day, ladies and gentlemen and welcome to the Second Quarter 2011 Cardinal Health Incorporated Earnings Conference Call. My name is Shaquana and I will be your coordinator for today. At this time all participants are in a listen-only mode. We will facilitate a question-and-answer session towards the end of the conference. (Operator Instructions).

I would now like to turn the presentation over to your host for today's call, Ms. Sally Curley, Senior Vice President, Investor Relations. Please proceed, ma'am.

Sally J. Curley - SVP, IR: Thank you, Shaquana and welcome to Cardinal Health's second quarter fiscal 2011 conference call.

Today, we will be making forward-looking statements. The matters addressed in these statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected or implied. Please refer to the SEC filings and the forward-looking statement slide at the beginning of the presentation found on the Investor page of our website for a description of risks and uncertainties. In addition, we will reference non-GAAP financial measures. Information about these measures is included at the end of the slides.

Before I turn the call over to Chairman and CEO, George Barrett, I'd like to remind you of few upcoming investment conferences and events in which we will be webcasting, notably the UBS Annual Healthcare Conference on February 7 at 11.30 am at Grand Hyatt in New York, the Citigroup Global Healthcare Conference on March 1 at 8.30 am at New York Hilton and the Barclays Capital Global Healthcare Conference on March 16 at 9.00 am at the Lotus Hotel in Miami.

The details of these events are or will be posted on the IR section of our website, at cardinalhealth.com, so please make sure to visit the site often for updated information. We look forward to seeing you at the upcoming events.

Now, I'd like to turn the call over to George Barrett. George?

George S. Barrett - Chairman and CEO: Thanks, Sally. Good morning everyone and thank you for joining us on our second quarter call. I am really pleased with our operating performance during the second quarter and throughout the first half of fiscal 2011. We reported revenues for the second quarter of $25.4 billion, up 2% over the prior year period and a non-GAAP EPS number of $0.69, up 21%.

Our operating performance in the quarter was driven by excellent results in our Pharmaceutical segment and we continued our disciplined management of expenses and working capital.

We also continued to strengthen our core businesses and position our Company to deliver sustained growth based on our performance in the first half of fiscal 2011, execution on our recent acquisitions and our best assessment of the current environment, we are increasing our full year fiscal 2011 guidance and now expect our non-GAAP earnings to be in the range of $2.54 to $2.60. Jeff will walk you through core assumptions during his remarks.

Now let me provide some color on each segments separately. Our Pharma segment continued its momentum in the second quarter. Revenue increased by 2% versus prior year, primarily driven by a 6% growth in sales to non-bulk customers.

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