Cardinal Health 2011 Annual Report Download - page 96

repackaging services; helps pharmaceutical manufacturers with services, including distribution, inventory
management,
d
ata/report
i
ng, new pro
d
uct
l
aunc
h
support, an
d
contract an
d
c
h
arge
b
ac
k
a
d
m
i
n
i
strat
i
on; an
d
maintains prime vendor relationships that streamline the purchasin
g
process resultin
g
in
g
reater efficienc
y
an
d
l
ower costs for our customers. Through our Yong Yu business, this segment imports and distributes
p
h
armaceut
i
ca
l
san
dh
ea
l
t
h
care pro
d
ucts
i
nC
hi
na.
T
he Medical segment distributes a broad range of medical, surgical and laboratory products to hospitals,
surgery centers,
l
a
b
orator
i
es, p
h
ys
i
c
i
an o
ffi
ces an
d
ot
h
er
h
ea
l
t
h
care prov
id
ers. T
hi
s segment a
l
so
d
eve
l
ops,
manufactures and sources medical and sur
g
ical products. These products include sterile and non-sterile procedur
e
kits; single-use surgical drapes, gowns and apparel; exam and surgical gloves; and fluid suction and collection
systems. Our me
di
ca
l
an
d
surg
i
ca
l
pro
d
ucts are so
ld di
rect
l
yort
h
roug
h
t
hi
r
d
-party
di
str
ib
utors
i
nt
h
eUn
i
te
d
States, Canada, Europe, South America, and the Asia/Pacific re
g
ion.
Th
e
f
o
ll
ow
i
ng ta
bl
e
i
nc
l
u
d
es revenue
f
or eac
h
reporta
bl
e segment an
d
reconc
ili
ng
i
tems necessary to agre
e
to amounts re
p
orted in the consolidated financial statements
:
Fiscal Year Ended June 30
,
(
in millions
)
2011
2010
2009
Segment revenue:
Ph
armaceut
i
ca
l(
1
)
.
........................................
$
9
3
,
743.5
$
89
,
789.9
$
87
,
862.9
Medical (2)
..............................................
8,921.
5
8,7
5
0.1 8,1
5
9.3
T
ota
l
se
g
ment revenu
e
.................................
102
,
665.0 98
,
540.0 96
,
022.2
Cor
p
orate (3)
.............................................
(
20.8) (37.2) (30.7)
T
ota
l
conso
lid
ate
d
re
v
enue
......................................
$102,644.2 $98,502.8 $95,991.5
(1) T
h
eP
h
armaceut
i
ca
l
se
g
ment’s revenue
i
spr
i
mar
ily d
er
i
ve
df
rom t
h
e
di
str
ib
ut
i
on o
fb
ran
d
e
d
an
dg
ener
i
c
p
harmaceutical, over-the-counter healthcare, and consumer
p
roducts
.
(2) T
h
eMe
di
ca
l
segment’s revenue
i
spr
i
mar
il
y
d
er
i
ve
df
rom t
h
e manu
f
actur
i
ng an
ddi
str
ib
ut
i
on o
f
me
di
ca
l,
s
ur
gi
ca
l
an
dl
a
b
orator
y
pro
d
ucts an
d
me
di
ca
l
proce
d
ure
ki
ts.
(3) Corporate revenue consists of the elimination of inter-se
g
ment revenue
.
We eva
l
uate se
g
ment per
f
ormance
b
ase
d
upon se
g
ment pro
fi
t, amon
g
ot
h
er measures. Se
g
ment pro
fi
t
i
s
se
g
ment revenue, less se
g
ment cost of products sold, less se
g
ment distribution, sellin
g
,
g
eneral an
d
ad
m
i
n
i
strat
i
ve expense (“SG&A”). Segment SG&A expenses
i
nc
l
u
d
e equ
i
ty s
h
are-
b
ase
d
compensat
i
on expense
a
swe
ll
as a
ll
ocate
d
corporate expenses
f
or s
h
are
df
unct
i
ons,
i
nc
l
u
di
ng corporate management, corporate
fi
nance,
f
inancial shared services, human resources, information technolo
gy
,le
g
al and an inte
g
rated hospital sale
s
o
rgan
i
zat
i
on. Corporate expenses are a
ll
ocate
d
to t
h
e segments
b
ase
d
upon
h
ea
d
count,
l
eve
l
o
fb
ene
fi
t prov
id
e
d
a
n
d
rata
bl
ea
ll
ocat
i
on. In
f
ormat
i
on a
b
out
i
nterest
i
ncome an
d
expense an
di
ncome taxes
i
s not prov
id
e
d
at t
he
se
g
ment level. In addition, restructurin
g
and emplo
y
ee severance, acquisition-related costs, impairments and los
s
o
nsa
l
eo
f
assets,
li
t
i
gat
i
on (recover
i
es)/c
h
arges, net, certa
i
n
i
nvestment an
d
ot
h
er spen
di
ng are not a
ll
ocate
d
t
o
t
h
e segments. Investment spen
di
ng genera
ll
y
i
nc
l
u
d
es t
h
e
fi
rst year spen
df
or certa
i
n pro
j
ects t
h
at requ
i
r
e
incremental strate
g
ic investments in the form of additional operatin
g
expenses. We encoura
g
e our se
g
ments to
id
ent
if
y
i
nvestment pro
j
ects t
h
at w
ill
promote
i
nnovat
i
on an
d
prov
id
e
f
uture returns. As approva
ld
ec
i
s
i
ons
f
or
suc
h
pro
j
ects are
d
epen
d
ent upon execut
i
ve mana
g
ement, t
h
e expenses
f
or suc
h
pro
j
ects are o
f
ten reta
i
ne
d
at
C
orporate. Investment spendin
g
within Corporate was $13.8 million and $26.5 million for fiscal 2011 and 2010,
respect
i
ve
l
y. See Notes 2, 3, 4 an
d
10, respect
i
ve
l
y,
f
or
f
urt
h
er
di
scuss
i
on o
f
our acqu
i
s
i
t
i
on-re
l
ate
d
costs
,
restructur
i
n
g
an
d
emp
l
o
y
ee severance,
i
mpa
i
rments an
dl
oss on sa
l
eo
f
assets an
dli
t
ig
at
i
on (recover
i
es)/c
h
ar
g
es,
net. In addition, S
p
in-Off costs included in SG&A of $9.6 million and $10.8 million for fiscal 2011 and 2010
,
respect
i
ve
l
y, are not a
ll
ocate
d
to our segments. T
h
e account
i
ng po
li
c
i
es o
f
t
h
e segments are t
h
e same as t
h
os
e
d
escr
ib
e
di
n
N
ote 1
.
70