AmerisourceBergen (ABC) Tops Q1 EPS by 24c, Revenues Beat; Raises FY21 EPS Guidance

AmerisourceBergen (NYSE: ABC) reported Q1 EPS of $2.18, $0.24 better than the analyst estimate of $1.94. Revenue for the quarter came in at $52.5 billion versus the consensus estimate of $50.49 billion.

"AmerisourceBergen is driven by our purpose and we continue to leverage our scale and expertise to provide innovative solutions for our partners. Our strong performance in the December quarter and the improved outlook and financial guidance we are providing for fiscal year 2021 are the result of our continued ability to execute and the resilience of our businesses," said Steven H. Collis, Chairman, President and Chief Executive Officer of AmerisourceBergen.

"As we move our business forward, we will continue to focus on execution excellence and supporting pharmaceutical innovation globally to enable positive outcomes by facilitating market access," Mr. Collis continued. "Our ongoing focus on long-term, sustainable growth and our purpose of being united in our responsibility to create healthier futures position us well to create significant value for all our stakeholders."

First Quarter Adjusted (non-GAAP) Results

• Revenue: No adjustments were made to the GAAP presentation of revenue. In the first quarter of fiscal 2021, revenue was $52.5 billion, up 9.7 percent compared to the same quarter in the previous fiscal year, reflecting a 9.7 percent increase in Pharmaceutical Distribution Services revenue and an 11.1 percent increase in revenue within Other.
• Adjusted Gross Profit: Adjusted gross profit in the fiscal 2021 first quarter was $1.4 billion, which was up 14.8 percent compared to the same period in the previous year due to increases in gross profit in Pharmaceutical Distribution Services and Other. Adjusted gross profit as a percentage of revenue was 2.72 percent in the fiscal 2021 first quarter, an increase of 12 basis points when compared to the prior year quarter due to an increase in specialty product sales.
• Adjusted Operating Expenses: In the first quarter of fiscal 2021, adjusted operating expenses were $809.6 million, an increase of 8.3 percent compared to the same period in the previous fiscal year due to higher distribution, selling, and administrative expenses. Adjusted operating expenses as a percentage of revenue in the fiscal 2021 first quarter was 1.54%, a decrease of 2 basis points when compared to the prior year quarter.
• Adjusted Operating Income: In the fiscal 2021 first quarter, adjusted operating income of $616.9 million increased 24.6 percent from the prior year period due to a 26.6 percent increase in Pharmaceutical Distribution Services' operating income and a 16.4 percent increase in operating income within Other. Adjusted operating income as a percentage of revenue was 1.17 percent in the fiscal 2021 first quarter, an increase of 14 basis points when compared to the prior year quarter.
• Interest Expense, Net: No adjustments were made to the GAAP presentation of net interest expense. In the fiscal 2021 first quarter, net interest expense of $33.6 million was up 8.4 percent versus the prior year quarter due to a decrease in interest income resulting primarily from a decline in investment interest rates and was partially offset by a decrease in interest expense.
• Adjusted Effective Tax Rate: The adjusted effective tax rate was 22.0 percent for the first quarter of fiscal 2021 compared to 21.0 percent in the prior year quarter.
• Adjusted Diluted Earnings Per Share: Adjusted diluted earnings per share was up 23.9 percent to $2.18 in the first quarter of fiscal 2021 compared to $1.76 in the previous fiscal year’s first quarter, driven by the increase in adjusted operating income.
• Diluted Shares Outstanding: No adjustments were made to the GAAP presentation of diluted shares outstanding. Diluted weighted average shares outstanding for the first quarter of fiscal 2021 were 206.8 million, a 0.3 percent decline versus the prior fiscal year first quarter primarily due to share repurchases, net of stock option exercises and restricted stock vesting.

GUIDANCE:

AmerisourceBergen sees Q2 2021 EPS of $8.40-$8.60, versus the consensus of $8.40.

AmerisourceBergen has updated its fiscal year 2021 financial guidance to reflect the Company’s continued strong performance and solid execution. This updated financial guidance does not include any contribution from the proposed Alliance Healthcare acquisition or any incremental growth from the expanded U.S. partnership announced in January 2021. The Company now expects:

• Revenue growth in the high-single digit percent range, up from the mid-single digit percent range; and
• Adjusted Diluted EPS to be in the range of $8.40 to $8.60, up from the previous range of $8.25 to $8.50.

Additional expectations now include:

• Adjusted operating expense growth in the mid- to high-single digit percent range, widened from the mid-single digit percent range;
• Adjusted operating income growth in the high-single digit percent range, up from the mid-single digit percent range;
  • Pharmaceutical Distribution Services segment operating income growth in the high-single digit percent range, up from the mid-single digit percent range;
  • Other, which is comprised of our Global Commercialization Services & Animal Health businesses, operating income growth in the mid- to high-single digit percent range, up from the mid-single digit percent range;
• Weighted average shares to be approximately 207 million, narrowed from the previous expectation of between 206 and 207 million for the fiscal year.

All other previously communicated aspects of the Company's fiscal year 2021 financial guidance and assumptions remain the same.

For earnings history and earnings-related data on AmerisourceBergen (ABC) click here.

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