Cardinal Health (CAH) Baird 2024 Global Healthcare Conference summary

Leadership and governance updates

• Four new independent directors were added, and a Business Review Committee (BRC) was established to evaluate the portfolio.

• The BRC concluded its work in January, transitioning the company to a normal course of portfolio review and M&A focus.

• Elliott board members decided not to stand for re-election but left on positive terms and remain shareholders.

• Leadership transition from restructuring to growth focus occurred after the first year.

• Strong collaboration with both new and legacy board members drove strategic changes.

Financial performance and strategic execution

• Cumulative EPS growth of nearly 50% and $7 billion in adjusted free cash flow over two years.

• Fiscal 2025 profit target for GMPD is $175 million, with $300 million targeted for 2026.

• Free cash flow guidance was exceeded, reaching $4 billion by June 30, driven by operational improvements.

• Cash flow for the current year will be lower due to working capital needs for new customer growth.

• Increased share repurchase commitment to $750 million for 2025.

Business segment strategies and growth

• Specialty business grew from $32B to $36B in fiscal 2024, with a 14% CAGR over four years.

• Specialty Networks acquisition brought new therapeutic breadth and advanced analytics technology.

• Navista was launched to build an MSO for oncology, leveraging new technology and leadership.

• Medical segment investments include domestic syringe manufacturing and supply chain resilience.

• OptiFreight, Nuclear & Precision Health, and At Home Solutions are high-margin, high-growth businesses benefiting from secular trends.