Cardinal Health 2011 Annual Report Download - page 52

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Consolidated Operatin
g
Earnin
g
s
I
n addition to revenue,
g
ross mar
g
in and SG&A discussed above, operatin
g
earnin
g
s were impacted b
y
th
e
f
o
ll
ow
i
ng
:
(
in millions
)
2011
2010
2009
R
estructur
i
n
g
an
d
emp
l
o
y
ee severanc
e
.......................................
$15.5 $ 90.7 $104.7
Ac
q
uisition-related cost
s
..................................................
22.9 8.4 2.
8
I
mpa
i
rments an
dl
oss on sa
l
eo
f
asset
s
.......................................
8
.
6
2
9.1 13.9
Liti
g
ation (recoveries)/char
g
es, net
.
........................................
6
.2 (62.4) 5.2
Restructurin
g
an
d
emp
l
o
y
ee severance
Fiscal 2011, 2010 and 2009 restructuring and employee severance charges included
$
7 million,
$
65 millio
n
a
nd
$
74 million, respectively, of costs arising from the Spin-Off.
Ac
q
uisition-related cost
s
D
urin
g
fiscal 2011, net acquisition-related costs included $21 million, related to the Kinra
y
, Yon
g
Yu an
d
P4 Healthcare acquisitions. The costs were partially offset by
$
6 million of income as a result of a decrease in the
cont
i
ngent cons
id
erat
i
on
li
a
bili
ty re
l
at
i
ng to t
h
e P4 Hea
l
t
h
care acqu
i
s
i
t
i
on, w
hi
c
h
re
fl
ects actua
l
per
f
ormance
f
or
the first measurement period and chan
g
es in our estimate of performance in future measurement periods. See
Note 2 o
f
t
h
e “Notes to Conso
lid
ate
d
F
i
nanc
i
a
l
Statements”
f
or a
ddi
t
i
ona
li
n
f
ormat
i
on on t
hi
sc
h
ange.
I
mpairments and loss on sale of assets
I
n fiscal 2010, we reco
g
nized an impairment char
g
e of $18 million related to the write-down o
f
Specialt
y
Scripts, a business within our Pharmaceutical se
g
ment. We completed the sale of Specialt
y
Script
s
d
ur
i
ng t
h
et
hi
r
d
quarter o
ffi
sca
l
2010.
L
itigation (recoveries)/charges, ne
t
I
n fiscal 2010, we received income of $41 million resultin
g
from settlement of a class action antitrust claim
in which we were a class member. In addition, we received
$
26 million of income for insurance
p
roceeds
re
l
ease
df
rom escrow a
f
ter
li
t
i
gat
i
on, commence
d
aga
i
nst certa
i
n
di
rectors an
d
o
ffi
cers
i
n 2004, was reso
l
ve
d.
E
arnings Before Income Taxes an
d
Discontinue
d
Operations
I
n addition to items discussed above, earnin
g
s before income taxes and discontinued operations were
i
mpacte
db
yt
h
e
f
o
ll
ow
i
ng:
C
hange
Earn
i
n
g
sBe
f
ore Income Taxes
a
nd D
i
scont
i
nued
Op
erat
i
ons
(
in millions, except
g
rowth rates
)
2011
2010
2011
2010
2009
Other (income)/ex
p
ense, ne
t
.............................
6
1%
N
.M. $(21.8) $ (13.5) $ 13.2
I
nterest ex
p
ense, net
.
.................................. (18)% (1)% 92.8 113.
5
114.
4
Loss on ext
i
ngu
i
s
h
ment o
fd
e
bt
...........................
N.M. N.M.
0
.
039
.
90
.
0
Gain on sale of CareFusion common stoc
k
..................
N.M. N.M. (7
5
.3) (44.6) 0.0
I
nterest ex
p
ense, net
Th
e
d
ecrease
i
n
i
nterest expense
f
or
fi
sca
l
2011 was pr
i
mar
il
y
d
ue to t
h
e
f
avora
bl
e
i
mpact o
fi
nterest rat
e
s
w
aps.
26