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McKESSON CORPORATION
FINANCIAL NOTES (Continued)
73
Restructuring Activities – Liabilities Related to Business Combinations
In connection with our OTN acquisition within our Distribution Solutions segment, to date we recorded a total
of $8 million of employee severance costs and $5 million of facility exit costs.
As of March 31, 2010, the majority of the restructuring accruals of $9 million, which primarily consist of
employee severance costs and facility exit and contract termination costs, are anticipated to be disbursed through
2011. Accrued restructuring liabilities are included in other accrued and other noncurrent liabilities in the
consolidated balance sheets.
The majority of past initiatives were completed during 2010. Based on our current existing initiatives, we
expect to complete the majority of these activities by the end of 2011. Expenses associated with these initiatives are
not anticipated to be material. Approximately 970 employees, consisting primarily of distribution, general and
administrative staffs were planned to be terminated as part of our restructuring plans since 2008, of which 891
employees had been terminated as of March 31, 2010. Restructuring expenses are included in cost of sales and
operating expenses in our consolidated statements of operations.
Other Workforce Reduction Charges
In 2010, 2009 and 2008, we recorded $20 million ($9 million for our Distribution Solutions segment and
$11 million for our Technology Solutions segment), $32 million ($7 million for our Distribution Solutions segment
and $25 million for our Technology Solutions segment) and $8 million of net charges (for our Technology Solutions
segment) associated with various reductions in workforce actions. Other workforce reduction charges also reflected
related facility exit costs of $4 million and $3 million in 2010 and 2009 for our Technology Solutions segment.
Although these actions do not constitute a restructuring plan, as defined under U.S. GAAP, they do represent
independent actions taken from time-to-time, as appropriate.
Total restructuring and other workforce reduction charges were recorded within our consolidated statements of
operations as follows: $5 million, $5 million and $7 million in cost of sales in 2010, 2009 and 2008 and $17 million,
$28 million and $20 million within operating expenses.
5. Other Income, Net
Years Ended March 31,
(In millions) 2010 2009 2008
Interest income $ 16 $ 31 $ 89
Equity in earnings, net 6 7 21
Gain on sale of investment 17 24 —
Impairment of investments — (63) —
Other, net 4 13 11
Total $ 43 $ 12 $ 121
In October 2009, our Distribution Solutions segment sold its 50% equity interest in McKesson Logistics
Solutions L.L.C. (“MLS”), a Canadian logistics company, for a pre-tax gain of $17 million or $14 million after-tax.
In July 2008, our Distribution Solutions segment sold its 42% equity interest in Verispan L.L.C. (“Verispan”), a
data analytics company, for a pre-tax gain of $24 million or $14 million after-tax.