Cardinal Health forecasts full-year profit above estimates on specialty drug strength

Signage is displayed outside of the Cardinal Health Inc. distribution warehouse in Groveport, Ohio, U.S., on Friday, Nov. 3, 2017.

U.S. drug distributor Cardinal Health CAH.N on Tuesday forecast fiscal 2027 profit well above Wall Street expectations after topping fourth-quarter profit estimates, driven by sustained demand for specialty drugs.

Shares of the company were up over 4 per cent in premarket trading.

Here are some details:

• Drug distributors are capitalizing on rising demand for biosimilars and high-margin medicines treating complex conditions such as cancer, rheumatoid arthritis and autoimmune diseases.
• Cardinal Health expects 2027 adjusted profit per share between US$12.40 and US$12.60. Analysts on average were expecting it to be US$12.04 per share.
• The Dublin, Ohio-based company’s total fourth-quarter revenue rose 6 per cent to US$63.67 billion, but missed analysts’ expectations of US$65.03 billion, according to data compiled by LSEG.
• Cardinal Health’s adjusted quarterly profit of US$2.91 per share beat estimates of US$2.42.
• The company’s largest unit by revenue, Pharmaceutical and Specialty Solutions, reported a 6 per cent year-over-year increase in sales to US$55.4 billion during the quarter, fueled by demand for branded and specialty drugs.
• Last month, Cardinal bought AdaptHealth’s diabetes health business and medical supply provider Strive Medical in separate tuck-in deals for about US$360 million in total, expanding its home care business.
• The AdaptHealth transaction broadened the company’s reach in diabetes care by utilizing its direct-to-consumer distribution platform for supplies including continuous glucose monitors and enhanced its position in the urology market through Strive Medical.
• Cardinal also said on Tuesday it sees US$1 billion in share repurchases in fiscal year 2027.

(Reporting by Padmanabhan Ananthan in Bengaluru; Editing by Maju Samuel)