Confirms FY guidance (Il Sole 24 Ore Radiocor) - New York, 22 Apr - Cardinal Health announced today that its pharmaceutical distribution contracts with OptumRx, which expire at the end of June 2024, will not be renewed.

The US distributor of pharmaceuticals, as well as manufacturer and distributor of medical and laboratory products, reaffirmed its fiscal 2024 adjusted diluted EPS guidance of 7.20-7.35 dollars.

Despite the nonrenewal of the OptumRx contracts, the company also reiterated the compound annual growth rate target of 12-14% for EPS for fiscal years from 2024 to 2026.

Sales to OptumRx generated 16% of Cardinal Health's revenue in fiscal year 2023. Sales to OptumRx generate a "meaningfully lower operating margin" than the overall Pharmaceutical and Specialty Solutions segments, it added.

Cardinal Health continues to expect to generate adjusted free cash flow of approximately 2 billion dollars on average from fiscal 2024 to 2026. However, the company anticipates lower-than-average adjusted free cash flow in fiscal 2025 due to the unwinding of negative net working capital associated with the OptumRx contract and day-of-the-week timing.

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(RADIOCOR) 22-04-24 19:35:23 (0691) 5 NNNN