Cardinal Health 2009 Annual Report Download - page 69

consolidated financial statements include the results of operations from each of these business combinations from
the date of acquisition.
The Company’s trend with regard to acquisitions has been to expand its role as a provider of services and
innovative products to the healthcare industry. This trend has resulted in expansion into areas that complement
the Company’s existing operations and provide opportunities for the Company to develop synergies with, and
strengthen, the acquired business. As the healthcare industry continues to change, the Company evaluates
possible candidates for acquisition and considers opportunities to expand its role as a provider of services to the
healthcare industry through all its reportable segments. There can be no assurance, however, that the Company
will be able to successfully take advantage of any such opportunity if and when it arises or consummate any such
transaction, if pursued. If additional transactions are pursued or consummated, the Company would incur
additional acquisition integration charges, and may need to enter into funding arrangements for such acquisitions.
There can be no assurance that the integration efforts associated with any such transaction would be successful.
Divestitures
During fiscal 2009, the Company divested its Tecomet (orthopedic implants and instruments) and
MedSystems (enteral devices and airway management products) businesses.
During fiscal 2007, the Company completed the sale of the PTS Business to an affiliate of The Blackstone
Group. At the closing of the sale, the Company received approximately $3.2 billion in cash, which was the
purchase price of approximately $3.3 billion as adjusted pursuant to certain provisions in the purchase
agreement. The Company recognized an after-tax book gain of approximately $1.1 billion from this transaction.
The Company used the after-tax net proceeds of approximately $3.1 billion from the sale to repurchase shares.
The purchase agreement contained customary indemnification provisions for sale transactions of this type.
The Company continues to evaluate the performance and strategic fit of its businesses and may decide to
sell a business or product line based on such an evaluation. As discussed above, the Company plans to spin off
CareFusion on August 31, 2009. In addition, during the fourth quarter of fiscal 2009, the Company approved
plans to divest Martindale and SpecialtyScripts.
Any divestitures may result in significant write-offs, including those related to goodwill and other intangible
assets, which could have an adverse effect on the Company’s results of operations and financial condition. In
addition, the Company may encounter difficulty in finding buyers or alternative exit strategies at acceptable
prices and terms and in a timely manner.
Liquidity and Capital Resources
Sources and Uses of Cash
The following table summarizes the Company’s consolidated statements of cash flows for fiscal 2009, 2008
and 2007:
(in millions) 2009 2008 2007
Net cash provided by/(used in)—continuing operations:
Operating activities ........................................... $1,558.3 $1,553.6 $ 975.1
Investing activities ............................................ (525.2) (716.3) (1,609.9)
Financing activities ........................................... (468.2) (803.2) (2,593.4)
Net cash provided by/(used in)—discontinued operations:
Operating activities ........................................... $ 9.0 $ (36.0) $ 258.6
Investing activities ............................................ (17.7) (10.1) 3,147.1
Financing activities ........................................... — — (45.4)
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