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McKESSON CORPORATION
See Financial Notes
56
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
Years Ended March 31,
2010 2009 2008
Operating Activities
Net income $ 1,263 $ 823 $ 990
Discontinued operations, net of income taxes — — (1)
Adjustments to reconcile to net cash provided by (used in)
operating activities:
Depreciation 148 133 124
Amortization 326 308 247
Provision for bad debts 17 29 41
Impairment of investments — 63 —
Other deferred taxes 161 320 196
Share-based compensation expense 114 99 91
Other non-cash items (20) (99) (107)
Changes in operating assets and liabilities, net of business
acquisitions:
Receivables (133) (708) (288)
Inventories (782) 370 (676)
Drafts and accounts payable 1,340 (189) 762
Deferred revenue 27 (55) 98
Taxes 88 (47) 336
Litigation charge (credit), net (20) 493 (5)
Litigation settlement payments (350) — (962)
Deferred tax (benefit) expense on litigation 116 (172) 2
Other 21 (17) 21
Net cash provided by operating activities 2,316 1,351 869
Investing Activities
Property acquisitions (199) (195) (195)
Capitalized software expenditures (179) (197) (161)
Acquisitions of businesses, less cash and cash equivalents
acquired (18) (358) (610)
Proceeds from sale of businesses 1 63 —
Restricted cash for litigation charge, net 55 (55) 962
Other 31 15 (1)
Net cash used in investing activities (309) (727) (5)
Financing Activities
Proceeds from short-term borrowings 5 3,630 260
Repayments of short-term borrowings (6) (3,630) (260)
Proceeds from issuances of long-term debt, net — 699 —
Repayment of long-term debt (218) (4) (162)
Common stock transactions:
Issuances 212 97 354
Share repurchases, including shares surrendered for tax
withholding (323) (298) (1,698)
Share repurchases, retirements — (204) —
Dividends paid (131) (116) (70)
Other 40 4 106
Net cash provided by (used in) financing activities (421) 178 (1,470)
Effect of exchange rate changes on cash and cash equivalents 36 (55) 14
Net increase (decrease) in cash and cash equivalents 1,622 747 (592)
Cash and cash equivalents at beginning of year 2,109 1,362 1,954
Cash and cash equivalents at end of year $ 3,731 $ 2,109 $ 1,362
Supplemental Cash Flow Information
Cash paid for:
Interest $ 188 $ 139 $ 146
Income taxes, net of refunds 234 235 (66)