McKesson 2015 Annual Report Download - page 123

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McKESSON CORPORATION
FINANCIAL NOTES (Continued)
management evaluates the performance of the Company combined with the nature of the individual business
activities. We evaluate the performance of our operating segments on a number of measures, including operating
profit before interest expense, income taxes and results from discontinued operations.
The McKesson Distribution Solutions segment distributes ethical and proprietary drugs and equipment and
health and beauty care products throughout North America and internationally. This segment includes our
International pharmaceutical distribution and services business which reflects the results of operations of Celesio,
which we acquired in February 2014. This segment also provides specialty pharmaceutical solutions for biotech
and pharmaceutical manufacturers, and practice management, technology, clinical support and business solutions
to oncology and other specialty practices operating in the community setting. This segment also provides
medical-surgical supply distribution, equipment, logistics and other services to healthcare providers through a
network of distribution centers within the U.S. In addition, this segment sells financial, operational and clinical
solutions for pharmacies (retail, hospital, alternate site) and provides consulting, outsourcing and other services.
In September 2013, we sold our 49% interest in Nadro, S.A. de C.V. (“Nadro”), a pharmaceutical distributor in
Mexico. Prior to the sale, financial results for Nadro were included in this segment.
The McKesson Technology Solutions segment delivers enterprise-wide clinical, patient care, financial,
supply chain, strategic management software solutions, as well as connectivity, outsourcing and other services,
including remote hosting and managed services, to healthcare organizations. This segment’s customers include
hospitals, physicians, homecare providers, retail pharmacies and payers primarily from North America.
Corporate includes expenses associated with Corporate functions and projects and the results of certain
equity investments. Corporate expenses are allocated to the operating segments to the extent that these items can
be directly attributable to the segment.
Financial information relating to our reportable operating segments and reconciliations to the consolidated
totals is as follows:
Years Ended March 31,
(In millions) 2015 2014 2013
Revenues
Distribution Solutions (1)
North America pharmaceutical distribution and services $143,711 $123,929 $115,443
International pharmaceutical distribution and services 26,358 4,485 —
Medical-Surgical distribution & services 5,907 5,648 3,603
Total Distribution Solutions 175,976 134,062 119,046
Technology Solutions - products and services 3,069 3,330 3,150
Total Revenues $179,045 $137,392 $122,196
Operating profit
Distribution Solutions $ 3,047 $ 2,472 $ 2,195
Technology Solutions 438 448 330
Total 3,485 2,920 2,525
Corporate Expenses, Net (454) (449) (335)
Interest Expense (374) (300) (240)
Income From Continuing Operations Before Income Taxes $ 2,657 $ 2,171 $ 1,950
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