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44
McKESSON CORPORATION
FINANCIAL REVIEW (Continued)
Operating activities for 2012 reflect an increase in drafts and accounts payable primarily associated with longer payment
terms for certain purchases, partially offset by an increase in receivables and higher inventories primarily associated with
revenue growth.
Operating activities for 2011 reflect an increase in receivables primarily associated with revenue growth, partially offset
by improved management of inventories and longer payment terms for certain purchases.
Cash flows from operations can be significantly impacted by factors such as the timing of receipts from customers and
payments to vendors.
Net cash used in investing activities was $2,209 million in 2013 compared to $1,502 million in 2012 and $624 million in
2011. Investing activities for 2013 included $1,873 million of cash payments for acquisitions, including $1,299 million for
our acquisition of PSS World Medical. Investing activities in 2013 also included $246 million and $160 million in capital
expenditures for property acquisitions and capitalized software.
Investing activities for 2012 included $1,156 million of cash payments for acquisitions, including $919 million for our
acquisition of the Katz Assets. Investing activities in 2012 also included $225 million and $178 million in capital
expenditures for property acquisitions and capitalized software.
Investing activities for 2011 included $292 million of cash payments for acquisitions, including $244 million for our
acquisition of US Oncology, and $109 million of cash received from the sale of MAP. Investing activities in 2011 also
included $233 million and $155 million in capital expenditures for property acquisitions and capitalized software.
Financing activities utilized cash of $956 million in 2013 compared to $1,905 million in 2012 and $1,841 million in
2011. Financing activities for 2013 include cash receipts of $1,325 million and cash paid of $1,725 million from short-term
borrowings. In addition, in connection with our acquisition of PSS World Medical, we borrowed $900 million for bridge
financing in February 2013, which was fully repaid in March 2013. Financing activities for 2013 also include cash receipts of
$1,798 million for the issuance of long-term debt and cash paid of $1,143 million for repayments of long-term debt. In
December 2012, we issued $500 million of 0.95% Notes due 2015 and $400 million of 2.70% Notes due 2022. In March
2013, we issued $500 million of 1.40% Notes due 2018 and $400 million of 2.85% Notes dues 2023. Long-term debt
repayments include $500 million paid on the maturity of our 5.25% Notes due in March 2013 and $635 million paid to
redeem the debt acquired on the acquisition of PSS World Medical. Additionally, financing activities for 2013 included
$1,214 million of cash paid for stock repurchases and $194 million of dividends paid.
Financing activities for 2012 included $1,874 million of cash paid for share repurchases, $400 million of cash paid on the
maturity of our 7.75% Notes in February 2012, $195 million of dividends paid, $400 million of cash receipts from secured
borrowings and $167 million of cash receipts from employees' exercises of stock options.
Financing activities for 2011 reflect $1,689 million of cash received from the issuance of long-term debt. In February
2011, we issued $600 million of 3.25% notes due 2016, $600 million of 4.75% notes due 2021, and $500 million of 6.00%
notes due 2041. Net proceeds from the issuance of the long-term notes, after discounts and offering expenses, were used to
pay off the $1,730 million of debt assumed as part of the acquisition of US Oncology. Also as part of our acquisition of US
Oncology, we borrowed $1,000 million for bridge financing which was fully repaid by February 2011. Financing activities
for 2011 also included $2,050 million of cash paid for share repurchases, $171 million of cash paid for dividends and
$367 million of cash receipts from employees' exercises of stock options.
The Company's Board has authorized the repurchase of McKesson's common stock from time-to-time in open market
transactions, privately negotiated transactions, through accelerated share repurchase (“ASR”) programs, or by any
combination of such methods. The timing of any repurchases and the actual number of shares repurchased will depend on a
variety of factors, including our stock price, corporate and regulatory requirements, restrictions under our debt obligations and
other market and economic conditions.