Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Jun. 30, 2018 | Jul. 31, 2018 | Dec. 31, 2017 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Jun. 30, 2018 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | cah | ||
Entity Registrant Name | CARDINAL HEALTH INC | ||
Entity Central Index Key | 721,371 | ||
Current Fiscal Year End Date | --06-30 | ||
Entity Current Reporting Status | Yes | ||
Entity Well-Known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Public Float | $ 19,248,647,885 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 308,828,810 |
Consolidated Statements of Earn
Consolidated Statements of Earnings - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Income Statement [Abstract] | |||
Revenue | $ 136,809 | $ 129,976 | $ 121,546 |
Cost of Goods and Services Sold | 129,628 | 123,432 | 115,003 |
Gross margin | 7,181 | 6,544 | 6,543 |
Operating expenses: | |||
Distribution, selling, general and administrative expenses | 4,596 | 3,775 | 3,648 |
Restructuring and employee severance | 176 | 56 | 25 |
Amortization and other acquisition-related costs | 707 | 527 | 459 |
Impairments and (gain)/loss on disposal of assets, net | 1,417 | 18 | 21 |
Litigation (recoveries)/charges, net | 159 | 48 | (69) |
Operating earnings | 126 | 2,120 | 2,459 |
Other (income)/expense, net | 23 | (5) | 5 |
Interest expense, net | 329 | 201 | 178 |
Loss on extinguishment of debt | 2 | 0 | 0 |
Earnings/(loss) before income taxes | (228) | 1,924 | 2,276 |
Provision for/(benefit from) income taxes | (487) | 630 | 845 |
Net earnings | 259 | 1,294 | 1,431 |
Less: Net earnings attributable to noncontrolling interests | (3) | (6) | (4) |
Net earnings attributable to Cardinal Health, Inc. | $ 256 | $ 1,288 | $ 1,427 |
Earnings per common share attributable to Cardinal Health, Inc. | |||
Net basic earnings per common share attributable to Cardinal Health, Inc. (in usd per share) | $ 0.82 | $ 4.06 | $ 4.36 |
Diluted earnings per common share attributable to Cardinal Health, Inc.: | |||
Net diluted earnings per common share attributable to Cardinal Health, Inc. (in usd per share) | $ 0.81 | $ 4.03 | $ 4.32 |
Weighted-average number of common shares outstanding: | |||
Basic (in shares) | 313 | 317 | 327 |
Diluted (in shares) | 315 | 320 | 330 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Statement of Comprehensive Income [Abstract] | |||
Net earnings | $ 259 | $ 1,294 | $ 1,431 |
Other comprehensive income/(loss): | |||
Foreign currency translation adjustments and other | 58 | (25) | (82) |
Amounts reclassified to earnings | (23) | 0 | 0 |
Net unrealized gain/(loss) on derivative instruments, net of tax | (2) | 16 | (11) |
Total other comprehensive income/(loss), net of tax | 33 | (9) | (93) |
Total comprehensive income | 292 | 1,285 | 1,338 |
Net Income (Loss) Attributable to Noncontrolling Interest | 3 | 6 | 4 |
Total comprehensive income attributable to Cardinal Health, Inc. | $ 289 | $ 1,279 | $ 1,334 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 30, 2017 |
Current assets: | ||
Cash and equivalents | $ 1,763 | $ 6,879 |
Trade receivables, net | 7,800 | 8,048 |
Inventories, net | 12,308 | 11,301 |
Prepaid expenses and other | 1,926 | 2,117 |
Total assets held for sale | 756 | 0 |
Total current assets | 24,553 | 28,345 |
Property and equipment, net | 2,487 | 1,879 |
Goodwill and other intangibles, net | 12,229 | 9,207 |
Other assets | 682 | 681 |
Total assets | 39,951 | 40,112 |
Current liabilities: | ||
Accounts payable | 19,677 | 17,906 |
Current portion of long-term obligations and other short-term borrowings | 1,001 | 1,327 |
Other accrued liabilities | 2,002 | 1,988 |
Disposal Group, Including Discontinued Operation, Liabilities | 213 | 0 |
Total current liabilities | 22,893 | 21,221 |
Long-term obligations, less current portion | 8,012 | 9,068 |
Deferred income taxes and other liabilities | 2,975 | 2,877 |
Redeemable noncontrolling interests | 12 | 118 |
Preferred shares, without par value: | ||
Authorized—500 thousand shares, Issued—none | 0 | 0 |
Common shares, without par value: | ||
Authorized—755 million shares, Issued—327 million shares at June 30, 2018 and June 30, 2017, respectively | 2,730 | 2,697 |
Retained earnings | 4,645 | 4,967 |
Common shares in treasury, at cost: 18 million shares and 11 million shares at June 30, 2018 and June 30, 2017, respectively | (1,224) | (731) |
Accumulated other comprehensive loss | (92) | (125) |
Total Cardinal Health, Inc. shareholders' equity | 6,059 | 6,808 |
Noncontrolling interests | 0 | 20 |
Total shareholders’ equity | 6,059 | 6,828 |
Total liabilities, redeemable noncontrolling interests and shareholders’ equity | $ 39,951 | $ 40,112 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - shares | Jun. 30, 2018 | Jun. 30, 2017 |
Statement of Financial Position [Abstract] | ||
Preferred shares, authorized | 500,000 | 500,000 |
Preferred shares, issued | 0 | 0 |
Common shares, authorized | 755,000,000 | 755,000,000 |
Common shares, issued | 327,000,000 | 327,000,000 |
Common shares in treasury | 18,000,000 | 11,000,000 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) shares in Millions, $ in Millions | Total | Common Shares | Retained Earnings | Treasury Shares | Accumulated Other Comprehensive Income/(Loss) | Noncontrolling Interests |
Net Income (Loss) Attributable to Parent | $ 1,427 | $ 1,427 | ||||
Balance at beginning of period (in shares) at Jun. 30, 2015 | 364 | |||||
Balance at beginning of period at Jun. 30, 2015 | 6,256 | $ 3,003 | 5,521 | $ (23) | ||
Treasury, balance at beginning of period (in shares) at Jun. 30, 2015 | (36) | |||||
Treasury, balance at beginning of period at Jun. 30, 2015 | $ (2,245) | |||||
Increase (Decrease) in Shareholders' Equity | ||||||
Net earnings | 1,431 | $ 3 | ||||
Net Earnings Including Portion Attributable to Noncontrolling Interest Excluding Redeemable Noncontrolling Interest | 1,430 | |||||
Other Comprehensive Income (Loss), Net of Tax | (93) | |||||
Other comprehensive loss, net of tax | (93) | (93) | ||||
Purchase of noncontrolling interests | 7 | 7 | ||||
Stock Issued During Period, Value, Share-based Compensation, Net of Forfeitures | 144 | $ 7 | $ 137 | |||
Stock Issued During Period, Shares, Share-based Compensation, Net of Forfeitures | 2 | |||||
Treasury shares acquired (in shares) | (8.2) | |||||
Treasury shares acquired | (651) | $ (651) | ||||
Dividends declared | (529) | (529) | ||||
Other | 21 | 21 | ||||
Balance at end of period (in shares) at Jun. 30, 2016 | 364 | |||||
Balance at end of period at Jun. 30, 2016 | 6,571 | $ 3,010 | 6,419 | (116) | 17 | |
Treasury, balance at end of period (in shares) at Jun. 30, 2016 | (42) | |||||
Treasury, balance at end of period at Jun. 30, 2016 | $ (2,759) | |||||
Balance at beginning of period (in shares) at Jun. 30, 2015 | 364 | |||||
Balance at beginning of period at Jun. 30, 2015 | $ 6,256 | $ 3,003 | 5,521 | (23) | ||
Treasury, balance at beginning of period (in shares) at Jun. 30, 2015 | (36) | |||||
Treasury, balance at beginning of period at Jun. 30, 2015 | $ (2,245) | |||||
Increase (Decrease) in Shareholders' Equity | ||||||
Treasury shares acquired | $ (1,800) | |||||
Balance at end of period (in shares) at Jun. 30, 2018 | 327 | 327 | ||||
Balance at end of period at Jun. 30, 2018 | $ 6,059 | $ 2,730 | 4,645 | (92) | 0 | |
Treasury, balance at end of period (in shares) at Jun. 30, 2018 | (18) | (18) | ||||
Treasury, balance at end of period at Jun. 30, 2018 | $ (1,224) | $ (1,224) | ||||
Net Income (Loss) Attributable to Parent | 1,288 | 1,288 | ||||
Balance at beginning of period (in shares) at Jun. 30, 2016 | 364 | |||||
Balance at beginning of period at Jun. 30, 2016 | 6,571 | $ 3,010 | 6,419 | (116) | 17 | |
Treasury, balance at beginning of period (in shares) at Jun. 30, 2016 | (42) | |||||
Treasury, balance at beginning of period at Jun. 30, 2016 | $ (2,759) | |||||
Increase (Decrease) in Shareholders' Equity | ||||||
Net earnings | 1,294 | 2 | ||||
Net Earnings Including Portion Attributable to Noncontrolling Interest Excluding Redeemable Noncontrolling Interest | 1,290 | |||||
Other Comprehensive Income (Loss), Net of Tax | (9) | (9) | ||||
Other comprehensive loss, net of tax | (9) | (9) | ||||
Purchase of noncontrolling interests | (1) | (1) | ||||
Stock Issued During Period, Value, Share-based Compensation, Net of Forfeitures | 156 | $ (11) | $ 167 | |||
Stock Issued During Period, Shares, Share-based Compensation, Net of Forfeitures | 2 | |||||
Treasury shares acquired (in shares) | (8.1) | |||||
Treasury shares acquired | (600) | $ (600) | ||||
Dividends declared | (580) | (580) | ||||
Other | 1 | (1) | 2 | |||
Retirement of Treasury Shares (in shares) | 37 | 37 | ||||
Retirement of Treasury Shares | $ 0 | $ 302 | (2,159) | $ 2,461 | ||
Balance at end of period (in shares) at Jun. 30, 2017 | 327 | 327 | ||||
Balance at end of period at Jun. 30, 2017 | $ 6,828 | $ 2,697 | 4,967 | (125) | 20 | |
Treasury, balance at end of period (in shares) at Jun. 30, 2017 | (11) | (11) | ||||
Treasury, balance at end of period at Jun. 30, 2017 | $ (731) | $ (731) | ||||
Net Income (Loss) Attributable to Parent | 256 | |||||
Increase (Decrease) in Shareholders' Equity | ||||||
Net earnings | 259 | (1) | ||||
Net Earnings Including Portion Attributable to Noncontrolling Interest Excluding Redeemable Noncontrolling Interest | 255 | |||||
Other Comprehensive Income (Loss), Net of Tax | 33 | |||||
Other comprehensive loss, net of tax | 33 | 33 | ||||
Purchase of noncontrolling interests | (19) | (19) | ||||
Stock Issued During Period, Value, Share-based Compensation, Net of Forfeitures | 90 | $ 33 | $ 57 | |||
Stock Issued During Period, Shares, Share-based Compensation, Net of Forfeitures | 1 | |||||
Treasury shares acquired (in shares) | (8.4) | |||||
Treasury shares acquired | (550) | $ (550) | ||||
Dividends declared | (584) | (584) | ||||
Other | $ 6 | 6 | ||||
Balance at end of period (in shares) at Jun. 30, 2018 | 327 | 327 | ||||
Balance at end of period at Jun. 30, 2018 | $ 6,059 | $ 2,730 | $ 4,645 | $ (92) | $ 0 | |
Treasury, balance at end of period (in shares) at Jun. 30, 2018 | (18) | (18) | ||||
Treasury, balance at end of period at Jun. 30, 2018 | $ (1,224) | $ (1,224) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Cash flows from operating activities: | |||
Net earnings | $ 259 | $ 1,294 | $ 1,431 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | |||
Depreciation and amortization | 1,032 | 717 | 641 |
Loss on extinguishment of debt | 2 | 0 | 0 |
Loss on Sale of Investments | 6 | 4 | 0 |
Impairments and (gain)/loss on disposal of assets, net | 1,417 | 18 | 21 |
Share-based compensation | 85 | 96 | 111 |
Provision for/(benefit from) deferred income taxes | (1,012) | 291 | 87 |
Provision for bad debts | 111 | 63 | 73 |
Change in fair value of contingent consideration obligation | (2) | (5) | (16) |
Change in operating assets and liabilities, net of effects from acquisitions and divestitures: | |||
Increase in trade receivables | (871) | (665) | (866) |
Increase in inventories | (1,211) | (673) | (1,179) |
Increase in accounts payable | 2,574 | 564 | 2,815 |
Other accrued liabilities and operating items, net | 378 | (520) | (147) |
Net cash provided by operating activities | 2,768 | 1,184 | 2,971 |
Cash flows from investing activities: | |||
Acquisition of subsidiaries, net of cash acquired | (6,142) | (132) | (3,614) |
Additions to property and equipment | (384) | (387) | (465) |
Purchase of available-for-sale securities and other investments | (9) | (194) | (200) |
Proceeds from sale of available-for-sale securities and other investments | 65 | 228 | 136 |
Proceeds from maturities of available-for-sale securities | 0 | 77 | 50 |
Proceeds from divestitures, net of cash sold, and disposal of property and equipment | 862 | 3 | 13 |
Net cash used in investing activities | (5,608) | (405) | (4,080) |
Cash flows from financing activities: | |||
Payment of contingent consideration obligation | (35) | (3) | (25) |
Net change in short-term borrowings | (50) | 3 | 26 |
Purchase of noncontrolling interests | (106) | (12) | (10) |
Reduction of long-term obligations | (954) | (310) | (6) |
Proceeds from interest rate swap terminations | 0 | 14 | 0 |
Proceeds from long-term obligations, net of issuance costs | 3 | 5,171 | 0 |
Net tax proceeds/(withholding) from share-based compensation | (3) | 26 | 6 |
Excess tax benefits from share-based compensation | 0 | 34 | 33 |
Dividends on common shares | (581) | (577) | (512) |
Purchase of treasury shares | (550) | (600) | (651) |
Net cash provided by/(used in) financing activities | (2,276) | 3,746 | (1,139) |
Effect of exchange rates changes on cash and equivalents | 4 | (2) | (12) |
CashReclassifiedtoAssetsHeldforSale | (4) | 0 | 0 |
Net increase/(decrease) in cash and equivalents | (5,116) | 4,523 | (2,260) |
Cash and equivalents at beginning of period | 6,879 | 2,356 | 4,616 |
Cash and equivalents at end of period | 1,763 | 6,879 | 2,356 |
Supplemental Information: | |||
Cash payments for interest | 320 | 200 | 174 |
Cash payments for income taxes | $ 425 | $ 686 | $ 635 |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | 1. Basis of Presentation and Summary of Significant Accounting Policies Cardinal Health, Inc. is a globally integrated healthcare services and products company providing customized solutions for hospitals, healthcare systems, pharmacies, ambulatory surgery centers, clinical laboratories and physician offices. The company provides medical products and pharmaceuticals and cost-effective solutions that enhance supply chain efficiency. References to “we”, “our” and similar pronouns in these consolidated financial statements are to Cardinal Health, Inc. and its majority-owned or controlled subsidiaries unless the context otherwise requires. Our fiscal year ends on June 30. References to fiscal 2018 , 2017 and 2016 in these consolidated financial statements are to the fiscal years ended June 30, 2018 , 2017 and 2016 , respectively. Basis of Presentation Our consolidated financial statements include the accounts of all majority-owned or controlled subsidiaries, and all significant intercompany transactions and amounts have been eliminated. To conform to the current year presentation, certain prior year amounts have been reclassified. The results of businesses acquired or disposed of are included in the consolidated financial statements from the date of the acquisition or up to the date of disposal, respectively. Use of Estimates Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The preparation of financial statements in accordance with GAAP requires us to make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Estimates, judgments and assumptions are used in the accounting and disclosure related to, among other items, allowance for doubtful accounts, inventory valuation and reserves, business combinations, goodwill and other intangible asset impairment, vendor reserves, loss contingencies, self-insurance accruals, income taxes and share-based compensation. Actual amounts could ultimately differ from these estimated amounts. Cash Equivalents We consider liquid investments purchased with an initial maturity of three months or less to be cash equivalents. The carrying value of cash equivalents approximates fair value. Receivables and Allowance for Doubtful Accounts Trade receivables are presented net of an allowance for doubtful accounts of $139 million and $137 million at June 30, 2018 and 2017 , respectively. An account is considered past due on the first day after its due date. In accordance with contract terms, we generally have the ability to charge customers service fees or higher prices if an account is considered past due. We regularly monitor past due accounts and establish appropriate reserves to cover potential losses, which are based primarily on historical collection rates and the credit worthiness of the customer. We write off any amounts deemed uncollectible against the established allowance for doubtful accounts. We provide financing to various customers. Such financing arrangements range from 1 year to 5 years at interest rates that are generally subject to fluctuation. Interest income on these arrangements is recognized as it is earned. The financings may be collateralized, guaranteed by third parties or unsecured. Finance notes, net and related accrued interest were $136 million (current portion $26 million ) and $171 million (current portion $53 million ) at June 30, 2018 and 2017 , respectively, and are included in other assets (current portion is included in prepaid expenses and other) in the consolidated balance sheets. Finance notes receivable allowance for doubtful accounts were $7 million and $9 million at June 30, 2018 and 2017 , respectively. We estimate an allowance for these financing receivables based on historical collection rates and the credit worthiness of the customer. We write off any amounts deemed uncollectible against the established allowance for doubtful accounts. Concentrations of Credit Risk We maintain cash depository accounts with major banks, and we invest in high quality, short-term liquid instruments, and in marketable securities. Our short-term liquid instruments mature within three months and we have not historically incurred any related losses. Investments in marketable debt securities consist of a portfolio of high-grade instruments. Such investments are made only in instruments issued by highly-rated institutions, whose financial condition we monitor. We had none of these investments at June 30, 2018. Our trade receivables and finance notes and related accrued interest are exposed to a concentration of credit risk with certain large customers and with customers in the retail and healthcare sectors. Credit risk can be affected by changes in reimbursement and other economic pressures impacting the healthcare industry. With respect to customers in the retail and healthcare sectors, such credit risk is limited due to supporting collateral and the diversity of the customer base, including its wide geographic dispersion. We perform regular credit evaluations of our customers’ financial conditions and maintain reserves for losses through the established allowance for doubtful accounts. Historically, such losses have been within our expectations. Refer to the "Receivables and Allowance for Doubtful Accounts" section within this Note for additional information on the accounting treatment of reserves for allowance for doubtful accounts. Major Customers CVS Health Corporation ("CVS") and OptumRx, are our only customers that individually account for at least 10 percent of revenue and gross trade receivables. These customers are primarily serviced through our Pharmaceutical segment. The following table summarizes historical percent of revenue and gross trade receivables from CVS and OptumRx: Percent of Revenue Percent of Gross Trade Receivables at June 30 2018 2017 2016 2018 2017 CVS 25 % 23 % 25 % 22 % 20 % OptumRx 11 % 11 % 7 % 4 % 1 % Our pharmaceutical distribution contract with OptumRx began in fiscal 2016 and did not exceed 10 percent until fiscal 2017. We have entered into agreements with group purchasing organizations (“GPOs”) which act as purchasing agents that negotiate vendor contracts on behalf of their members. Vizient, Inc. and Premier, Inc. are our two largest GPO member relationships in terms of revenue. Sales to members of these two GPOs collectively accounted for 22 percent , 21 percent and 17 percent of revenue for fiscal 2018 , 2017 and 2016 , respectively. Our trade receivable balances are with individual members of the GPO, and therefore no significant concentration of credit risk exists with these types of arrangements. Inventories A substantial portion of our inventories ( 56 percent at both June 30, 2018 and 2017 ) are valued at the lower of cost, using the last-in, first-out ("LIFO") method, or market. These inventories are included within the core pharmaceutical distribution facilities of our Pharmaceutical segment (“distribution facilities”) and are primarily merchandise inventories. The LIFO method presumes that the most recent inventory purchases are the first items sold, so LIFO helps us better match current costs and revenue. We believe that the average cost method of inventory valuation provides a reasonable approximation of the current cost of replacing inventory within the distribution facilities. As such, the LIFO reserve is the difference between (a) inventory at the lower of LIFO cost or market and (b) inventory at replacement cost determined using the average cost method of inventory valuation. If we had used the average cost method of inventory valuation for all inventory within the distribution facilities, the value of our inventories would not have changed in fiscal 2018 or 2017 because inventories valued at LIFO were $92 million and $46 million higher than the average cost value at June 30, 2018 and 2017 , respectively. We do not record inventories in excess of replacement cost. As such, we did not record any changes in our LIFO reserve in fiscal 2018 and 2017 . Our remaining inventory that is not valued at the lower of LIFO or market is stated at the lower of cost, using the first-in, first-out method, or net realizable value. Net realizable value is defined as the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Inventories presented in the consolidated balance sheets are net of reserves for excess and obsolete inventory which were $147 million and $76 million at June 30, 2018 and 2017 , respectively. The increase in the reserves for excess and obsolete inventory during fiscal 2018 was driven by increased Cordis inventory reserves and the Patient Recovery acquisition. We reserve for inventory obsolescence using estimates based on historical experience, historical and projected sales trends, specific categories of inventory and age of on-hand inventory. Cash Discounts Manufacturer cash discounts are recorded as a component of inventory cost and recognized as a reduction of cost of products sold as inventory is sold. Property and Equipment Property and equipment are carried at cost less accumulated depreciation. Property and equipment held for sale are recorded at the lower of cost or fair value less cost to sell. When certain events or changes in operating conditions occur, an impairment assessment may be performed on the recoverability of the carrying amounts. Depreciation expense is computed using the straight-line method over the estimated useful lives of the assets, including capital lease assets which are depreciated over the terms of their respective leases. We generally use the following range of useful lives for our property and equipment categories: buildings and improvements— 3 to 39 years ; machinery and equipment— 3 to 20 years ; and furniture and fixtures— 3 to 7 years . We recorded depreciation and amortization expense of $446 million , $314 million and $277 million for fiscal 2018 , 2017 and 2016 , respectively. The following table presents the components of property and equipment, net at June 30: (in millions) 2018 2017 Land, building and improvements $ 2,115 $ 1,637 Machinery and equipment 3,006 2,860 Furniture and fixtures 139 130 Total property and equipment, at cost 5,260 4,627 Accumulated depreciation and amortization (2,773 ) (2,748 ) Property and equipment, net $ 2,487 $ 1,879 Repairs and maintenance expenditures are expensed as incurred. Interest on long-term projects is capitalized using a rate that approximates the weighted-average interest rate on long-term obligations, which was 4 percent at June 30, 2018 . The amount of capitalized interest was immaterial for all periods presented. Business Combinations The assets acquired and liabilities assumed in a business combination, including identifiable intangible assets, are recorded at their estimated fair values as of the acquisition date. The excess of the purchase price over the estimated fair value of the identifiable net assets acquired is recorded as goodwill. We base the fair values of identifiable intangible assets on detailed valuations that require management to make significant judgments, estimates and assumptions. Critical estimates and assumptions include: expected future cash flows for customer relationships, trade names and other identifiable intangible assets; discount rates that reflect the risk factors associated with future cash flows; and estimates of useful lives. When an acquisition involves contingent consideration, we recognize a liability equal to the fair value of the contingent consideration obligation at the acquisition date. The estimate of fair value of a contingent consideration obligation requires subjective assumptions to be made regarding future business results, discount rates, discount periods and probabilities assigned to various potential business result scenarios. See Note 2 for additional information regarding our acquisitions. Goodwill and Other Intangible Assets Purchased goodwill and intangible assets with indefinite lives are not amortized, but instead are tested for impairment annually or when indicators of impairment exist. Purchased goodwill is tested for impairment at least annually. Qualitative factors are first assessed to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If it is determined that it is more likely than not that the fair value does not exceed the carrying amount, then a quantitative test is performed. The quantitative goodwill impairment test involves a comparison of the estimated fair value of the reporting unit to the respective carrying amount. Goodwill impairment testing involves judgment, including the identification of reporting units, qualitative evaluation of events and circumstances to determine if it is more likely than not that an impairment exists, and, if necessary, the estimation of the fair value of the applicable reporting unit. Our qualitative evaluation considers the weight of evidence and significance of all identified events and circumstances and most relevant drivers of fair value, both positive and negative, in determining whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. We have two operating segments, which are the same as our reportable segments: Pharmaceutical and Medical. These operating segments are comprised of divisions (components), for which discrete financial information is available. Components are aggregated into reporting units for purposes of goodwill impairment testing to the extent that they share similar economic characteristics. Our reporting units are: Pharmaceutical operating segment (excluding our Nuclear Pharmacy Services division); Nuclear Pharmacy Services division; Medical operating segment (excluding our Cardinal Health at Home division and naviHealth division) (“Medical Unit”); Cardinal Health at Home division; and naviHealth division. Fair value can be determined using market, income or cost-based approaches. Our determination of estimated fair value of the reporting units is based on a combination of the income-based and market-based approaches. Under the income-based approach, we use a discounted cash flow model in which cash flows anticipated over several future periods, plus a terminal value at the end of that time horizon, are discounted to their present value using an appropriate risk-adjusted rate of return. We use our internal forecasts to estimate future cash flows, which we believe are consistent with those of a market participant, and include an estimate of long-term growth rates based on our most recent views of the long-term outlook for each reporting unit. Actual results may differ materially from those used in our forecasts. We use discount rates that are commensurate with the risks and uncertainty inherent in the respective reporting units and in our internally-developed forecasts. Discount rates used in our reporting unit valuations ranged from 8.5 percent to 13.5 percent . Under the market-based approach, we determine fair value by comparing our reporting units to similar businesses or guideline companies whose securities are actively traded in public markets. We also use the guideline transaction method to determine fair value based on pricing multiples derived from the sale of companies that are similar to our reporting units. To further confirm fair value, we compare the aggregate fair value of our reporting units to our total market capitalization. Estimating the fair value of reporting units requires the use of estimates and significant judgments that are based on a number of factors including forecasted operating results. The use of alternate estimates and assumptions or changes in the industry or peer groups could materially affect the determination of fair value for each reporting unit and potentially result in goodwill impairment. We performed annual impairment testing in fiscal 2018 , 2017 and 2016 and with the exception of our Medical Unit in fiscal 2018, concluded that there were no impairments of goodwill as the estimated fair value of each reporting unit exceeded its carrying value. As discussed further in Note 5 of the "Notes to Consolidated Financial Statements," during the fourth quarter of fiscal 2018 we recognized a $1.4 billion goodwill impairment charge related to our Medical Unit, which is included in impairments and loss on disposal of assets in our consolidated statements of earnings. There was no tax benefit related to this goodwill impairment charge. The impairment test for indefinite-lived intangibles other than goodwill (primarily IPR&D) involves first assessing qualitative factors to determine if it is more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount. If so, then a quantitative test is performed to compare the estimated fair value of the indefinite-lived intangible asset to the respective asset's carrying amount. Our qualitative evaluation requires the use of estimates and significant judgments and considers the weight of evidence and significance of all identified events and circumstances and most relevant drivers of fair value, both positive and negative, in determining whether it is more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount. Intangible assets with finite lives, primarily customer relationships; trademarks, trade names and patents; and developed technology, are amortized using a combination of straight-line and accelerated methods based on the expected cash flows from the asset over their estimated useful lives. We review intangible assets with finite lives for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. Determining whether an impairment loss occurred requires a comparison of the carrying amount to the sum of the future forecasted undiscounted cash flows expected to be generated by the asset group. Actual results may differ materially from those used in our forecasts. Assets Held for Sale We classify assets and liabilities (the “disposal group”) as held for sale when management commits to a plan to sell the disposal group in its present condition and at a price that is reasonable in relation to its current fair value. We also consider whether an active program to locate a buyer has been initiated and if it is probable that the sale will occur within one year without significant changes to the plan to sell. Upon classification of the disposal group as held for sale, we test the assets for impairment and cease related depreciation and amortization. Investments Investments in non-marketable equity securities are accounted for under either the cost or equity method of accounting and are included in other assets in the consolidated balance sheets. For investments in which we can exercise significant influence, we use the equity method of accounting. Our share of the earnings and losses was immaterial, both individually and in the aggregate, for all periods presented and is recorded in other income, net in the consolidated statements of earnings. We closely monitor our investments for other-than-temporary impairment by considering factors such as the operating performance of the investment and current economic and market conditions. Marketable securities are classified as available-for-sale and are carried at fair value in the consolidated balance sheets. Unrealized gains and losses on available-for-sale securities, net of applicable taxes, are included within shareholders’ equity in accumulated other comprehensive income ("AOCI"). We monitor these securities for other-than-temporary impairment by considering factors such as the duration that, and the extent to which, the fair value is below cost, the operating performance and credit worthiness of the issuer of the securities and current economic and market conditions. See Note 6 for additional information regarding available-for-sale securities. Vendor Reserves In the ordinary course of business, our vendors may dispute deductions taken against payments otherwise due to them or assert other disputes. These disputes are researched and resolved based upon the findings of the research performed. At any given time, there are outstanding items in various stages of research and resolution. In determining appropriate reserves for areas of exposure with our vendors, we assess historical experience and current outstanding claims. We have established various levels of reserves based on the type of claim and status of review. Though the claim types are relatively consistent, we periodically refine our methodology by updating the reserve estimate percentages to reflect actual historical experience. The ultimate outcome of certain claims may be different than our original estimate and may require an adjustment. Adjustments to vendor reserves are included in cost of products sold. In addition, the reserve balance will fluctuate due to variations of outstanding claims from period-to-period, timing of settlements and specific vendor issues, such as bankruptcies. Vendor reserves were $45 million and $50 million at June 30, 2018 and 2017 , respectively, excluding third-party returns. See Third-Party Returns section within this Note for a description of third-party returns. Distribution Services Agreement and Other Vendor Fees Our Pharmaceutical segment recognizes fees received from distribution services agreements and other fees received from vendors related to the purchase or distribution of the vendors’ inventory when those fees have been earned and we are entitled to payment. Since the benefit provided to a vendor is related to the purchase and distribution of the vendor’s inventory, we recognize the fees as a reduction in the carrying value of the inventory that generated the fees, and as such, a reduction of cost of products sold in our consolidated statements of earnings when the inventory is sold. Loss Contingencies and Self-Insurance We accrue for contingencies related to disputes, litigation and regulatory matters if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We also self-insure for employee healthcare, general liability, certain product liability matters, auto liability, property and workers' compensation. Self-insurance accruals include an estimate for expected settlements or pending claims, defense costs, administrative fees, claim adjustment costs and an estimate for claims incurred but not reported. Because these matters are inherently unpredictable and unfavorable developments or resolutions can occur, assessing contingencies and other liabilities is highly subjective and requires judgments about future events. We regularly review contingencies and our self-insurance accruals to determine whether our accruals and related disclosures are adequate. The amount of ultimate loss may differ from these estimates. We recognize these estimated loss contingencies, income from favorable resolution of litigation and certain defense costs in litigation (recoveries)/charges in our consolidated statements of earnings. See Note 9 for additional information regarding loss contingencies and product liability lawsuits. Income Taxes We account for income taxes using the asset and liability method. Deferred tax assets and liabilities are measured using enacted tax rates in the respective jurisdictions in which we operate . We assess the realizability of deferred tax assets on a quarterly basis and provide a valuation allowance for deferred tax assets when it is more likely than not that at least a portion of the deferred tax assets will not be realized. The realizability of deferred tax assets depends on our ability to generate sufficient taxable income within the carryback or carryforward periods provided for in the tax law for each applicable tax jurisdiction and also considers all available positive and negative evidence. Deferred taxes for non-U.S. liabilities are not provided on the unremitted earnings of subsidiaries outside of the United States when it is expected that these earnings are indefinitely reinvested. Tax benefits from uncertain tax positions are recognized when it is more likely than not that the position will be sustained upon examination of the technical merits of the position, including resolutions of any related appeals or litigation processes. The amount recognized is measured as the largest amount of tax benefit that is greater than 50 percent likely of being realized upon settlement. See Note 8 for additional information regarding income taxes. Other Accrued Liabilities Other accrued liabilities represent various current obligations, including certain accrued operating expenses and taxes payable. Noncontrolling Interests and Redeemable Noncontrolling Interests Noncontrolling interests represent the portion of net earnings, comprehensive income and net assets that is not attributable to Cardinal Health, Inc. The redeemable noncontrolling interests relate to our ownership interest in naviHealth Holdings, LLC ("naviHealth"), which we acquired during fiscal 2016. The redeemable noncontrolling interests are redeemable at the option of the third-party noncontrolling interest holders at any time after the two-year anniversary of the closing, or earlier if a trigger event occurs. As such, the noncontrolling interests have been presented as redeemable noncontrolling interests in our consolidated balance sheets. The noncontrolling interests will be adjusted each period for net earnings and dividends attributable to the noncontrolling interests and changes in the noncontrolling ownership interests, if any. An additional adjustment to the carrying value of the noncontrolling interests may be required if the redemption value under the terms of the agreement exceeds the carrying value. Changes in the carrying value of the noncontrolling interests related to a change in the redemption value will be recorded through retained earnings and will not affect net earnings attributable to Cardinal Health, Inc. See Note 13 for additional information regarding redeemable noncontrolling interests. In June 2018, we signed a securities purchase agreement and a contribution and rollover agreement with investor entities controlled by Clayton, Dubilier & Rice ("CD&R") to sell our ownership interest in naviHealth. For more information on this divestiture see Note 4 . Share-Based Compensation Share-based compensation provided to employees is recognized in the consolidated statements of earnings based on the grant date fair value of the awards. The fair value of stock options is determined on the grant date using a lattice valuation model. The fair value of restricted share units and performance share units is determined by the grant date market price of our common shares. The compensation expense associated with nonvested performance share units is dependent on our periodic assessment of the probability of the targets being achieved and our estimate, which may vary over time, of the number of shares that ultimately will be issued. The compensation expense recognized for share-based awards is net of estimated forfeitures and is recognized ratably over the service period of the awards. All income tax effects of share-based awards are recognized in the statement of earnings as awards vest or are settled. We classify share-based compensation expense in distribution, selling, general and administrative ("SG&A") expenses to correspond with the same line item as the majority of the cash compensation paid to employees. If awards are modified in connection with a restructuring activity, the incremental share-based compensation expense is classified in restructuring and employee severance. See Note 17 for additional information regarding share-based compensation. Dividends We paid cash dividends per common share of $1.85 , $1.80 and $1.55 in fiscal 2018 , 2017 and 2016 , respectively. Revenue Recognition We recognize revenue when persuasive evidence of an arrangement exists, product delivery has occurred or the services have been rendered, the price is fixed or determinable, and collectability is reasonably assured. Pharmaceutical Segment The Pharmaceutical segment recognizes distribution revenue when title transfers to its customers and we have no further obligation to provide services related to such merchandise. Revenue for deliveries that are directly shipped to customers from the manufacturer when we act as an intermediary in the ordering and delivery of products is recorded gross. This is in accordance with accounting standards addressing reporting revenue on a gross basis as a principal versus on a net basis as an agent. This revenue is recorded on a gross basis since we incur credit risk from the customer, are primarily responsible for fulfillment, bear the risk of loss for incomplete shipments and do not receive a separate fee or commission for the transaction and, as such, are the primary obligor. Revenue from these sales is recognized when title transfers to the customer and we have no further obligation to provide services related to such merchandise. Radiopharmaceutical revenue is recognized upon delivery of the product to the customer and we have no further obligation to provide services related to such merchandise. Medical Segment The Medical segment recognizes revenue when title transfers to its customers and we have no further obligation to provide services related to such products. Sales Returns and Allowances Revenue is recorded net of sales returns and allowances. Our customer return policies generally require that the product be physically returned, subject to restocking fees, in a condition suitable to be added back to inventory and resold at full value, or returned to vendors for credit (“merchantable product”). Product returns are generally consistent throughout the year and typically are not specific to any particular product or customer. We accrue for estimated sales returns and allowances at the time of sale based upon historical customer return trends, margin rates and processing costs. Our accrual for sales returns is reflected as a reduction of revenue and cost of products sold for the sales price and cost, respectively. At June 30, 2018 and 2017 , the accrual for estimated sales returns and allowances was $479 million and $347 million , respectively, the impact of which is reflected in trade receivables, net and inventories, net in the consolidated balance sheets. Sales returns and allowances were $2.4 billion , $2.3 billion and $2.2 billion , for fiscal 2018 , 2017 and 2016 , respectively. Third-Party Returns We generally do not accept non-merchantable pharmaceutical product returns from our customers, so many of our customers return non-merchantable pharmaceutical products to the manufacturer through third parties. Since our customers generally do not have a direct relationship with manufacturers, our vendors pass the value of such returns to us (usually in the form of an accounts payable deduction) for distribution to customers. We, in turn, pass the value received, less an administrative fee, to our customer. In certain instances, we pass the estimated value of the return to our customer prior to our receipt of the value from the vendor. Although we believe we have satisfactory protections, we could be subject to claims from customers or vendors if our administration of this overall process was deficient in some respect or our contractual terms with vendors are in conflict with our contractual terms with our customers. We have maintained reserves for some of these situations based on their nature and our historical experience with their resolution. Shipping and Handling Shipping and handling costs are primarily included in SG&A expenses in our consolidated statements of earnings. Shipping and handling costs include all delivery expenses as well as all costs to prepare the product for shipment to the end customer. Shipping and handling costs were $543 million , $496 million and $504 million , for fiscal 2018 , 2017 and 2016 , respectively. Revenue received for shipping and handling was immaterial for all periods presented. Restructuring and Employee Severance Restructuring activities are programs that are not part of the ongoing operations of our underlying business, such as closing and consolidating facilities, changing the w |
Acquisitions
Acquisitions | 12 Months Ended |
Jun. 30, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | 2. Acquisitions D uring fiscal 2018 , we completed several acquisitions, the most significant of which is the Patient Recovery Business described in more detail below. T he pro forma results of operations and the results of operations for acquired businesses since the acquisition dates have not been separately disclosed because the effects were not significant compared to the consolidated financial statements, individually or in the aggregate. Patient Recovery Business On July 29, 2017, we acquired the Patient Care, Deep Vein Thrombosis, and Nutritional Insufficiency businesses (the "Patient Recovery Business") from Medtronic plc for $6.1 billion in cash. The Patient Recovery Business manufactures 23 categories of medical products sold into multiple healthcare channels. The acquisition further expanded the Medical segment's portfolio of self-manufactured products. We closed the Patient Recovery Business acquisition in 28 principal countries on July 29, 2017, and acquired control of, for GAAP purposes, and the rights to the net economic benefit from the entire Patient Recovery Business in the remaining countries at the closing. We are in the process of transitioning legal ownership in the remaining non-principal countries, which we expect to complete in early calendar 2019. The results for the entire Patient Recovery Business in all countries are included in the consolidated financial statements beginning July 29, 2017. We funded the acquisition through $4.5 billion in long-term debt, existing cash and borrowings under our existing credit arrangements. Transaction and integration costs associated with the acquisition of the Patient Recovery business were $109 million during the fiscal year ended June 30, 2018 and are included in amortization and other acquisition-related costs in the consolidated statements of earnings. Fair Value of Assets Acquired and Liabilities Assumed The allocation of the purchase price for the acquisition of the Patient Recovery Business is not yet finalized and is subject to adjustment as we complete the valuation analysis for this acquisition. The valuation of identifiable intangible assets utilizes significant unobservable inputs and thus represents a Level 3 nonrecurring fair value measurement. The estimated fair value of the identifiable intangible assets was determined using income-based approaches, which includes market participant expectations of the cash flows that an asset could generate over its economic life, discounted back to present value using an appropriate rate of return. The weighted- average discount rate used to arrive at the present value of the identifiable intangible assets was 8.0 percent, and considers the inherent risk of each intangible asset relative to the internal rate of return and weighted-average cost of capital. The following table summarizes the estimated fair value of the assets acquired and liabilities assumed as of the acquisition date for the Patient Recovery Business: (in millions) Patient Recovery Business Identifiable intangible assets: Customer relationships (1) $ 1,733 Trade names (2) 187 Developed technology and other (3) 732 Total identifiable intangible assets acquired 2,652 Cash and equivalents 22 Inventories 425 Prepaid expenses and other 252 Property and equipment, net 741 Other accrued liabilities (322 ) Deferred income taxes and other liabilities (982 ) Total identifiable net assets acquired/(liabilities assumed) 2,788 Goodwill 3,292 Total net assets acquired $ 6,080 (1) The range of useful lives for customer relationships is 10 to 18 years. (2) The useful life of trade names is 15 years. (3) The useful life of developed technology is 15 years. |
Restructuring and Employee Seve
Restructuring and Employee Severance | 12 Months Ended |
Jun. 30, 2018 | |
Restructuring Charges [Abstract] | |
Restructuring and Employee Severance | 3. Restructuring and Employee Severance The following tables summarize restructuring and employee severance costs: (in millions) 2018 2017 2016 Employee-related costs (1) $ 34 $ 51 $ 15 Facility exit and other costs (2) 142 5 10 Total restructuring and employee severance $ 176 $ 56 $ 25 (1) Employee-related costs primarily consist of termination benefits provided to employees who have been involuntarily terminated and duplicate payroll costs during transition periods. (2) Facility exit and other costs primarily consist of product distribution and lease contract termination costs, accelerated depreciation, equipment relocation costs, project consulting fees and costs associated with restructuring our delivery of information technology infrastructure services. In September 2017, we entered into an agreement to transition the distribution of our Medical segment's surgeon gloves in certain international markets from a third-party distribution arrangement to a direct distribution model. The costs with this restructuring include $125 million , on a pre-tax basis, of contract termination costs which have been paid and are reflected in facility exit and other costs in the consolidated statement of earnings during the fiscal year ended 2018. The following table summarizes activity related to liabilities associated with restructuring and employee severance: (in millions) Employee- Related Costs Facility Exit and Other Costs Total Balance at June 30, 2016 $ 15 $ 1 $ 16 Additions 43 1 44 Payments and other adjustments (17 ) (2 ) (19 ) Balance at June 30, 2017 41 — 41 Additions 19 131 150 Payments and other adjustments (36 ) (127 ) (163 ) Balance at June 30, 2018 $ 24 $ 4 $ 28 |
Divestitures and Assets Held fo
Divestitures and Assets Held for Sale | 12 Months Ended |
Jun. 30, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Divestitures and Assets Held for Sale | 4. Divestitures and Assets Held for Sale China Divestiture In February 2018, we sold our pharmaceutical and medical products distribution business in China ("China distribution business") for proceeds of $861 million (after adjusting for third party indebtedness and preliminary transaction adjustments) to Shanghai Pharmaceuticals Holding Co., Ltd. The proceeds are not reflective of tax obligations due in connection with the sale, for which we have recorded a liability of $59 million . The purchase price is subject to adjustment based on working capital requirements as set forth in the definitive agreement, which would impact the loss related to this divestiture. We determined that the sale of the China distribution business does not meet the criteria to be classified as discontinued operations. The China distribution business primarily operated within our Pharmaceutical segment, and a smaller portion operated within our Medical segment. During the fiscal year ended 2018, we recognized a pre-tax loss of $41 million related to this divestiture. naviHealth Assets Held for Sale In June 2018, we entered into a Securities Purchase Agreement and related Contribution and Rollover Agreement with investor entities controlled by CD&R. Pursuant to those agreements, on August 1, 2018, we sold our 98% ownership interest in naviHealth Holdings, LLC in exchange for proceeds of $736 million (after adjusting for certain fees and expenses) and a 44% equity interest in a partnership that owns 100% of the equity interest of naviHealth. We also have certain call rights to reacquire naviHealth. Upon signing the agreement, we met the criteria for the related assets and liabilities of naviHealth to be classified as held for sale. At June 30, 2018, we determined that the fair value less cost to sell exceeded the book value of the disposal group and there were no other indicators of asset impairment. We recognized a provisional tax benefit of $12 million related to the transaction during the three months ended June 30, 2018. See Note 8 for additional information regarding income taxes. We determined that the sale of naviHealth does not meet the criteria to be classified as discontinued operations. The naviHealth business operated within our Medical segment. The following table presents information related to the assets and liabilities that were classified as held for sale at June 30, 2018 in the consolidated balance sheets: (in millions) June 30, 2018 Trade Receivables, net $ 74 Goodwill and other intangibles, net 642 Other assets 40 Total assets held for sale $ 756 Deferred revenue 35 Deferred income taxes 38 Other liabilities 140 Total liabilities related to assets held for sale $ 213 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill The following table summarizes the changes in the carrying amount of goodwill by segment and in total: (in millions) Pharmaceutical (1) Medical (2) Total Balance at June 30, 2016 $ 2,919 $ 4,248 $ 7,167 Goodwill acquired, net of purchase price adjustments 29 35 64 Foreign currency translation adjustments and other (9 ) (1 ) (10 ) Balance at June 30, 2017 2,939 4,282 7,221 Goodwill acquired, net of purchase price adjustments 1 3,342 3,343 Foreign currency translation adjustments and other 28 6 34 Goodwill divested with the sale of our China distribution business (347 ) (54 ) (401 ) naviHealth goodwill reclassified to assets held for sale — (509 ) (509 ) Impairment — (1,372 ) (1,372 ) Balance at June 30, 2018 $ 2,621 $ 5,695 $ 8,316 (1) At June 30, 2018 and 2017, the Pharmaceutical segment accumulated goodwill impairment loss was $829 million . (2) At June 30, 2018 , the Medical segment accumulated goodwill impairment loss was $1.4 billion . The Medical segment had no accumulated goodwill impairment loss at June 30, 2017. The increase in the Medical segment goodwill during fiscal 2018 is primarily due to the Patient Recovery Business acquisition. Goodwill recognized in connection with the Patient Recovery Business acquisition primarily represents the expected benefits from certain synergies of integrating the business, the existing workforce of the acquired entity, and the expected growth from new customers. See Note 2 for further discussion of this acquisition. In conjunction with the preparation of our consolidated financial statements for fiscal 2018, we recently completed our annual quantitative goodwill impairment test, which we perform annually in the fourth quarter. This quantitative test resulted in a $1.4 billion goodwill impairment charge related to our Medical Unit, which is included in impairments and loss on disposal of assets in our consolidated statements of earnings. The impairment was primarily driven by inventory and cost challenges within our Cordis business which furthered in the fourth quarter of fiscal 2018. This impairment charge does not impact our liquidity, cash flows from operations, or compliance with debt covenants. There was no tax benefit related to the goodwill impairment charge. The goodwill balance for our Medical Unit, after recognizing the impairment, was $4.3 billion at June 30, 2018. Using a combination of income and market-based approaches (using a discount rate of 8.5 percent ), the carrying amount exceeded the fair value and resulted in an impairment of $1.4 billion for the Medical unit. Our fair value estimates utilize significant unobservable inputs and thus represent Level 3 fair value measurements. During fiscal 2018, goodwill was also reduced by $401 million and $509 million in connection with the sale of our China distribution business and reclassification of naviHealth's assets and liabilities to held for sale, respectively. See Note 4 for further discussion of this divestiture and assets held for sale. Other Intangible Assets The following tables summarize other intangible assets by class at June 30: 2018 (in millions) Gross Intangible Accumulated Amortization Net Intangible Weighted- Average Remaining Amortization Period (Years) Indefinite-life intangibles: IPR&D, trademarks and other $ 62 $ — $ 62 N/A Total indefinite-life intangibles 62 — 62 N/A Definite-life intangibles: Customer relationships 3,513 1,191 2,322 15 Trademarks, trade names and patents 667 246 421 15 Developed technology and other 1,562 454 1,108 12 Total definite-life intangibles 5,742 1,891 3,851 14 Total other intangible assets $ 5,804 $ 1,891 $ 3,913 N/A 2017 (in millions) Gross Intangible Accumulated Amortization Net Intangible Indefinite-life intangibles: IPR&D, trademarks and other $ 61 $ — $ 61 Total indefinite-life intangibles 61 — 61 Definite-life intangibles: Customer relationships 1,966 967 999 Trademarks, trade names and patents 509 195 314 Developed technology and other 916 304 612 Total definite-life intangibles 3,391 1,466 1,925 Total other intangible assets $ 3,452 $ 1,466 $ 1,986 Total amortization of intangible assets was $574 million , $395 million and $355 million for fiscal 2018 , 2017 and 2016 , respectively. The estimated annual amortization for intangible assets for fiscal 2019 through 2023 is as follows: $529 million , $501 million , $430 million , $398 million and $348 million . During fiscal 2018, other intangible assets were reduced by $62 million and $133 million in connection with the sale of our China distribution business and reclassification of naviHealth's assets and liabilities to held for sale, respectively. See Note 4 for further discussions of this divestiture and assets held for sale. |
Available-for-Sale Securities
Available-for-Sale Securities | 12 Months Ended |
Jun. 30, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Available-for-Sale Securities | 6. Available-for-Sale Securities We invest in marketable securities, which are classified as available-for-sale and are carried at fair value in the consolidated balance sheets. We held the following investments in marketable securities at fair value at June 30: (in millions) 2018 2017 Current available-for-sale securities: Treasury bills — 25 International bonds — 3 Corporate bonds — 30 U.S. agency bonds — 3 Asset-backed securities — 3 International equity securities — 1 Total available-for-sale securities $ — $ 65 In July 2017, we liquidated our marketable securities. There were no unrealized gains or losses at June 30, 2018 and unrealized gains and losses were immaterial at June 30, 2017 . During fiscal 2018 , 2017 and 2016 , gross realized gains and losses were immaterial and we did not recognize any other-than-temporary-impairments. |
Long-Term Obligations and Other
Long-Term Obligations and Other Short-Term Borrowings | 12 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Obligations and Other Short-Term Borrowings | 7. Long-Term Obligations and Other Short-Term Borrowings The following table summarizes long-term obligations and other short-term borrowings at June 30: (in millions) (1) 2018 2017 1.7% Notes due 2018 $ — $ 400 1.95% Notes due 2018 — 547 1.948% Notes due 2019 998 996 2.4% Notes due 2019 448 453 4.625% Notes due 2020 514 519 2.616% Notes due 2022 1,143 1,142 3.2% Notes due 2022 243 248 Floating Rate Notes due 2022 348 347 3.2% Notes due 2023 525 544 3.079% Notes due 2024 742 744 3.5% Notes due 2024 390 396 3.75% Notes due 2025 460 481 3.41% Notes due 2027 1,340 1,340 4.6% Notes due 2043 346 346 4.5% Notes due 2044 342 341 4.9% Notes due 2045 445 445 4.368% Notes due 2047 594 594 7.0% Debentures due 2026 124 124 Other obligations 11 388 Total 9,013 10,395 Less: current portion of long-term obligations and other short-term borrowings 1,001 1,327 Long-term obligations, less current portion $ 8,012 $ 9,068 (1) Maturities are presented on a calendar year basis. Maturities of existing long-term obligations and other short-term borrowings for fiscal 2019 through 2023 and thereafter are as follows: $1.0 billion , $452 million , $516 million , $1.7 billion , $526 million and $4.8 billion . Long-Term Debt All the notes represent unsecured obligations of Cardinal Health, Inc. and rank equally in right of payment with all of our existing and future unsecured and unsubordinated indebtedness. The 7.0% Debentures represent unsecured obligations of Allegiance Corporation (a wholly-owned subsidiary), which Cardinal Health, Inc. has guaranteed. None of these obligations are subject to a sinking fund and the Allegiance obligations are not redeemable prior to maturity. Interest is paid pursuant to the terms of the obligations. These notes are effectively subordinated to the liabilities of our subsidiaries, including trade payables of $19.7 billion . In June 2018, we repaid the full principal of the 1.95% Notes due 2018 at maturity for $550 million . In July 2017, we redeemed the 1.7% Notes due 2018 early in full with a portion of the proceeds from the June 2017 issuance for $400 million . In June 2017, we issued additional debt with the aggregate principal amount of $5.2 billion to fund a portion of the acquisition of the Patient Recovery Business from Medtronic, which closed on July 29, 2017 , to redeem the 1.7% Notes due 2018 and for general corporate purposes. The notes issued in conjunction with the acquisition are 1.948% Notes due 2019, 2.616% Notes due 2022, 3.079% Notes due 2024, 3.41% Notes due 2027, 4.368% Notes due 2047, and floating rate Notes due 2022. The amount of the notes issued net of discounts, premiums, mark-to-market of any interest rate swaps and debt issuance costs was $5.2 billion . If we undergo a change of control, as defined in the notes, and if the notes receive specified ratings below investment grade by each of Standard & Poors Ratings Services, Moody’s Investors Services and Fitch Ratings, any holder of the notes, excluding the debentures, can require with respect to the notes owned by such holder, or we can offer, to repurchase the notes at 101% of the principal amount plus accrued and unpaid interest. Other Financing Arrangements In addition to cash and equivalents and operating cash flow, other sources of liquidity include a $2.0 billion revolving credit facility and a $1.0 billion committed receivables sales facility program, which we increased in August 2017 from $1.75 billion to $2.0 billion . In November 2016, we renewed our committed receivables sales facility program through Cardinal Health Funding, LLC (“CHF”) through November 1, 2019. CHF was organized for the sole purpose of buying receivables and selling undivided interests in those receivables to third-party purchasers. Although consolidated with Cardinal Health, Inc. in accordance with GAAP, CHF is a separate legal entity from Cardinal Health, Inc. and from our subsidiary that sells receivables to CHF. CHF is designed to be a special purpose, bankruptcy-remote entity whose assets are available solely to satisfy the claims of its creditors. We also maintain a $2.0 billion commercial paper program backed by a $2.0 billion revolving credit facility. At June 30, 2018 , we had no amounts outstanding under the revolving credit facility; however, availability was reduced by outstanding letters of credit of $24 million and $20 million at June 30, 2018 and 2017 , respectively. We also had no amounts outstanding under the committed receivables sales facility program; however, availability was reduced by outstanding standby letters of credit of $34 million and $46 million at June 30, 2018 and 2017 , respectively. Under our commercial paper and committed receivables programs, we had a maximum amount outstanding of $1.7 billion and an average daily amount outstanding of $277 million during fiscal 2018 . We had no amounts outstanding under the commercial paper program as of June 30, 2018 . Our revolving credit facility and committed receivables sales facility program require us to maintain, as of the end of any calendar quarter, a consolidated leverage ratio of no more than 4.25 -to-1, which will reduce to 3.25-to-1 in March 2019. As of June 30, 2018 , we were in compliance with these financial covenants. We also maintain other short-term credit facilities and an unsecured line of credit that allowed for borrowings up to $8 million and $690 million at June 30, 2018 and 2017 , respectively. The $11 million and $388 million balance of other obligations at June 30, 2018 and 2017 , respectively, consisted of short-term borrowings and capital leases. In fiscal 2018 we sold our China distribution business, including its debt which was $378 million as of June 30, 2017. See Note 4 for further discussion of this divestiture. |
Income Taxes
Income Taxes | 12 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Earnings/(loss) before Income Taxes and Provision for Income Taxes The following table summarizes earnings/(loss) before income taxes: (in millions) 2018 2017 2016 U.S. operations $ 391 $ 1,772 $ 2,050 Non-U.S. operations (619 ) 152 226 Earnings/(loss) before income taxes $ (228 ) $ 1,924 $ 2,276 The following table summarizes the components of provision for/(benefit from) income taxes: (in millions) 2018 2017 2016 Current: Federal $ 341 $ 273 $ 633 State and local 41 10 52 Non-U.S. 143 56 73 Total current $ 525 $ 339 $ 758 Deferred: Federal $ (1,003 ) $ 258 $ 96 State and local 16 37 12 Non-U.S. (25 ) (4 ) (21 ) Total deferred (1,012 ) 291 87 Provision for/(benefit from) income taxes $ (487 ) $ 630 $ 845 Effective Tax Rate The following table presents a reconciliation of the provision based on the federal statutory income tax rate to our effective income tax rate: 2018 (1) 2017 (2) 2016 (2) Provision at Federal statutory rate 28.1 % 35.0 % 35.0 % State and local income taxes, net of federal benefit (16.0 ) 1.0 1.5 Foreign tax rate differential (48.4 ) (7.3 ) (0.6 ) Nondeductible/nontaxable items (10.2 ) 0.2 1.0 Goodwill impairment (124.7 ) — — Tax Act 410.9 — — Capital loss 71.4 — — Change in valuation allowances (76.9 ) 7.7 0.1 Foreign tax credits 27.3 (1.6 ) (0.1 ) China tax related to divestiture (25.8 ) — — Other (21.9 ) (2.3 ) 0.2 Effective income tax rate 213.8 % 32.7 % 37.1 % (1) The effective income tax rate for fiscal 2018 represents an income tax benefit tax rate. (2) The effective income tax rates for fiscal 2017 and 2016 represents income tax expense tax rates. The income tax benefit rate in fiscal 2018 was 213.8% compared to income tax expense rates of 32.7% in fiscal 2017 and 37.1% in fiscal 2016. Fluctuations in the effective tax rates are primarily due to net benefits from the enactment of the Tax Act, the impact of nondeductible goodwill impairment charges, and a benefit from a capital loss due to international legal entity reorganization. There were also changes in valuation allowances related to capital losses, credit carryforwards and net operating loss carryforwards in U.S. federal, U.S. state and international jurisdictions. On December 22, 2017, the United States enacted the Tax Act. The Tax Act makes broad and complex changes to the U.S. tax code that affect our fiscal year 2018 financial results in two primary ways. First, effective as of January 1, 2018, the Tax Act reduces the U.S. federal corporate tax rate from 35 percent to 21 percent. Second, it requires companies to pay a one-time U.S. repatriation tax on certain undistributed earnings of foreign subsidiaries. Because our fiscal year ends in June, we have a blended U.S. Federal statutory tax rate for fiscal 2018 of 28.1 percent under the Tax Act. The Tax Act also establishes new tax provisions that will affect us beginning July 1, 2018 including, (1) eliminating the U.S. manufacturing deduction; (2) establishing new limitations on deductible interest expense and certain executive compensation; (3) eliminating the corporate alternative minimum tax; (4) creating the base erosion anti-abuse tax; (5) creating a new provision designed to tax global intangible low-tax income (“GILTI”); (6) generally eliminating U.S. federal income taxes on dividends from foreign subsidiaries; and (7) changing rules related to uses and limitations of net operating loss carryforwards created in tax years beginning after December 31, 2017. Regarding the new GILTI tax rules, we are allowed to make an accounting policy election to either (1) treat taxes due on future GILTI exclusions in U.S. taxable income as a current period expense when incurred or (2) reflect such portion of the future GILTI exclusions in U.S. taxable income that relate to existing basis differences in our measurement of deferred taxes. Our analysis of the new GILTI rules and how they may impact us is incomplete. Accordingly, we have not made a policy election regarding the treatment of the GILTI tax. As a result of the enactment of a lower tax rate, we remeasured our U.S. deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future. While we are still analyzing certain aspects of the Tax Act and refining our calculations, we have recorded a provisional net benefit of $977 million related to this required remeasurement. The provisional estimate is based on currently available information related to deferred tax assets and liabilities which is subject to change as additional information becomes available, prepared, and analyzed. At June 30, 2018 , we had $110 million of undistributed earnings from non-U.S. subsidiaries. In connection with the required one-time U.S. repatriation tax on undistributed earnings of foreign subsidiaries, we recorded a provisional tax expense of $41 million which may change when our calculation is complete. The Tax Act permits the payment of this tax in eight installments over an eight-year period beginning in fiscal 2019. Though these foreign earnings have been deemed to be repatriated from a U.S. federal tax perspective, we have not yet completed our assessment of the Tax Act on our plans to reinvest foreign earnings and as such have not changed our prior conclusion that the earnings are indefinitely reinvested. The repatriation tax is based on currently available information and technical guidance related to the new tax law. The provisional estimate will be updated when additional information related to undistributed foreign earnings, foreign taxes and foreign cash and equivalents becomes available, prepared and analyzed. Our effective tax rate was unfavorably impacted by goodwill impairment charges related to our Medical operating segment for the portion attributable to nondeductible goodwill for income tax purposes. On June 28, 2018, we executed an international legal entity reorganization. This transaction resulted in a US capital loss and a tax benefit of $163 million . Due to the uncertainty of the future utilization of the capital loss, we recorded a valuation allowance of $72 million on the carryforward. We had other changes in valuation allowances related to federal credits and various international and state net operating losses that we believe are more likely than not to expire unutilized. Deferred Income Taxes Deferred income taxes arise from temporary differences between financial reporting and tax reporting bases of assets and liabilities and operating loss and tax credit carryforwards for tax purposes. The following table presents the components of the deferred income tax assets and liabilities at June 30: (in millions) 2018 2017 Deferred income tax assets: Receivable basis difference $ 41 $ 42 Accrued liabilities 110 125 Share-based compensation 40 53 Loss and tax credit carryforwards 526 378 Deferred tax assets related to uncertain tax positions 30 51 Other 101 43 Total deferred income tax assets 848 692 Valuation allowance for deferred income tax assets (412 ) (237 ) Net deferred income tax assets $ 436 $ 455 Deferred income tax liabilities: Inventory basis differences $ (1,103 ) $ (1,578 ) Property-related (176 ) (183 ) Goodwill and other intangibles (934 ) (570 ) Total deferred income tax liabilities $ (2,213 ) $ (2,331 ) Net deferred income tax liability $ (1,777 ) $ (1,876 ) Deferred income tax assets and liabilities in the preceding table, after netting by taxing jurisdiction, are in the following captions in the consolidated balance sheets at June 30: (in millions) 2018 2017 Noncurrent deferred income tax asset (1) 37 73 Noncurrent deferred income tax liability (2) (1,814 ) (1,949 ) Net deferred income tax liability $ (1,777 ) $ (1,876 ) (1) Included in other assets in the consolidated balance sheets. (2) Included in deferred income taxes and other liabilities in the consolidated balance sheets. At June 30, 2018 we had gross federal, state and international loss and credit carryforwards of $794 million , $2.0 billion and $1.1 billion , respectively, the tax effect of which is an aggregate deferred tax asset of $526 million . Substantially all of these carryforwards are available for at least three years. Approximately $379 million of the valuation allowance at June 30, 2018 applies to certain federal, state and international loss carryforwards that, in our opinion, are more likely than not to expire unutilized. However, to the extent that tax benefits related to these carryforwards are realized in the future, the reduction in the valuation allowance would reduce income tax expense. Unrecognized Tax Benefits We had $423 million , $417 million and $527 million of unrecognized tax benefits at June 30, 2018 , 2017 and 2016 , respectively. The June 30, 2018 , 2017 and 2016 balances include $262 million , $268 million and $355 million , respectively, of unrecognized tax benefits that, if recognized, would have an impact on the effective tax rate. The remaining unrecognized tax benefits relate to tax positions for which ultimate deductibility is highly certain but for which there is uncertainty as to the timing of such deductibility. Recognition of these tax benefits would not affect our effective tax rate. We include the full amount of unrecognized tax benefits in deferred income taxes and other liabilities in the consolidated balance sheets. The following table presents a reconciliation of the beginning and ending amounts of unrecognized tax benefits: (in millions) 2018 2017 2016 Balance at beginning of fiscal year $ 417 $ 527 $ 542 Additions for tax positions of the current year 15 29 22 Additions for tax positions of prior years (1) 141 23 42 Reductions for tax positions of prior years (40 ) (8 ) (48 ) Settlements with tax authorities (1) (99 ) (154 ) (30 ) Expiration of the statute of limitations (1) (11 ) — (1 ) Balance at end of fiscal year $ 423 $ 417 $ 527 (1) Included in additions for tax positions of prior years is $110 million related to exposures acquired as part of the Patient Recovery Business for which we are indemnified. Settlements of $81 million related to the Patient Recovery Business as well as $11 million of statute expirations. It is reasonably possible that there could be a change in the amount of unrecognized tax benefits within the next 12 months due to activities of the U.S. Internal Revenue Service ("IRS") or other taxing authorities, possible settlement of audit issues, reassessment of existing unrecognized tax benefits or the expiration of statutes of limitations. We estimate that the range of the possible change in unrecognized tax benefits within the next 12 months is a net decrease of $0 million to $35 million , exclusive of penalties and interest. We recognize accrued interest and penalties related to unrecognized tax benefits in the provision for income taxes. At June 30, 2018 , 2017 and 2016 , we had $110 million , $99 million and $145 million , respectively, accrued for the payment of interest and penalties. These balances are gross amounts before any tax benefits and are included in deferred income taxes and other liabilities in the consolidated balance sheets. During fiscal 2018 and 2017, we recognized $8 million and $12 million of expense for interest and penalties in income tax expense, respectively. During fiscal 2016 , we recognized $9 million of benefit for interest and penalties in income tax expense. Other Tax Matters We file income tax returns in the U.S. federal jurisdiction, various U.S. state and local jurisdictions, and various foreign jurisdictions. With few exceptions, we are subject to audit by taxing authorities for fiscal years 2008 through the current fiscal year. We are a party to a tax matters agreement with CareFusion Corporation ("CareFusion"), which has been acquired by Becton, Dickinson and Company. Under the tax matters agreement, CareFusion is obligated to indemnify us for certain tax exposures and transaction taxes prior to our fiscal 2010 spin-off of CareFusion. The indemnification receivable was $151 million and $142 million at June 30, 2018 and 2017 , respectively, and is included in other assets in the consolidated balance sheets. As a result of the acquisition of the Patient Recovery Business, Medtronic plc is obligated to indemnify us for certain tax exposures and transaction taxes related to periods prior to the acquisition under the purchase agreement. The indemnification receivable was $21 million at June 30, 2018 and is included in Other assets in the consolidated balance sheet. |
Commitments, Contingent Liabili
Commitments, Contingent Liabilities and Litigation | 12 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments, Contingent Liabilities and Litigation | 9. Commitments, Contingent Liabilities and Litigation Commitments Operating Leases The future minimum rental payments for operating leases having initial or remaining non-cancelable lease terms in excess of one year at June 30, 2018 for fiscal 2019 through 2023 and thereafter are as follows: $113 million , $97 million , $77 million , $58 million , $41 million and $103 million . Rental expense relating to operating leases was $172 million , $159 million and $126 million in fiscal 2018 , 2017 and 2016 , respectively. Sublease rental income was immaterial for all periods presented. Generic Sourcing Venture With CVS Health Corporation Red Oak Sourcing, LLC ("Red Oak Sourcing") is a U.S.-based generic pharmaceutical sourcing venture with CVS Health for an initial term through June 2024. Red Oak Sourcing negotiates generic pharmaceutical supply contracts on behalf of its participants. Due to the achievement of predetermined milestones, we are required to make quarterly payments of $45.6 million to CVS Health for the initial term. Contingencies New York Opioid Stewardship Act In April 2018, the State of New York passed a budget which included the Opioid Stewardship Act (the "OSA"). The OSA created an aggregate $100 million annual assessment on all manufacturers and distributors licensed to sell or distribute opioids in New York. Each licensed manufacturer and distributor will be required to pay a portion of the assessment based on its ratable share, as determined by the state, of the total morphine milligram equivalents sold or distributed in New York during the applicable calendar year. The initial payment is due on January 1, 2019 for opioids sold or distributed during calendar year 2017. We accrue for contingencies if it is probable that a liability has been incurred and the amount can be reasonably estimated. At this time, we believe that it is probable that we owe an amount under the OSA for calendar years 2017 and 2018, but we are unable to estimate the amount because of uncertainties with respect to the implementation of the assessment and because the information necessary to determine our share of the assessment is not yet available. Legal Proceedings We become involved from time to time in disputes, litigation and regulatory matters. We may be named from time to time in qui tam actions initiated by private third parties. In such actions, the private parties purport to act on behalf of federal or state governments, allege that false claims have been submitted for payment by the government and may receive an award if their claims are successful. After a private party has filed a qui tam action, the government must investigate the private party's claim and determine whether to intervene in and take control over the litigation. These actions may remain under seal while the government makes this determination. If the government declines to intervene, the private party may nonetheless continue to pursue the litigation on his or her own purporting to act on behalf of the government . From time to time, we become aware through employees, internal audits or other parties of possible compliance matters, such as complaints or concerns relating to accounting, internal accounting controls, financial reporting, auditing, or other ethical matters or relating to compliance with laws such as healthcare fraud and abuse, anti-corruption or anti-bribery laws. When we become aware of such possible compliance matters, we investigate internally and take appropriate corrective action. In addition, from time to time, we receive subpoenas or requests for information from various federal or state agencies relating to our business or to the business of a customer, supplier or other industry participants. Internal investigations, subpoenas or requests for information could lead to the assertion of claims or the commencement of legal proceedings against us or result in sanctions. From time to time, we may determine that products we manufacture or market do not meet our specifications, regulatory requirements, or published standards. When we or a regulatory agency identify a potential quality or regulatory issue, we investigate and take appropriate corrective action. Such actions can lead to product recalls, costs to repair or replace affected products, temporary interruptions in product sales, action by regulators and product liability claims and lawsuits, including class actions. Even absent an identified regulatory or quality issue or product recall, we can become subject to product liability claims and lawsuits. We accrue for contingencies related to disputes, litigation and regulatory matters if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Because these matters are inherently unpredictable and unfavorable developments or resolutions can occur, assessing contingencies is highly subjective and requires judgments about future events. We regularly review contingencies to determine whether our accruals and related disclosures are adequate. The amount of ultimate loss may differ from these estimates. We recognize income from the favorable outcome of litigation when we receive the associated cash or assets. We recognize estimated loss contingencies for certain litigation and regulatory matters and income from favorable resolution of litigation in litigation (recoveries)/charges in our consolidated statements of earnings. Opioid Lawsuits Pharmaceutical wholesale distributors, including us, have been named as defendants in over 1,000 lawsuits relating to the distribution of prescription opioid pain medications. These lawsuits have been filed in various federal, state, and other courts by a variety of plaintiffs, which are primarily counties, municipalities and political subdivisions from 48 states. Plaintiffs also include state attorneys general, unions and other health and welfare funds, hospital systems and other healthcare providers. Of these lawsuits, 32 are purported class actions. The lawsuits seek equitable relief and monetary damages based on a variety of legal theories including various common law claims, such as negligence, public nuisance, unjust enrichment as well as violations of controlled substance laws and various other statutes. Many also name pharmaceutical manufacturers, retail pharmacy chains and other entities as defendants. The vast majority of these lawsuits have been filed in U.S. federal court and have been transferred for consolidated pre-trial proceedings in a Multi-District Litigation proceeding in the United States District Court for the Northern District of Ohio. The court, among other things, ordered that three lawsuits proceed to trial in 2019 depending on the outcome of pre-trial motions. As a part of these proceedings, distributors have engaged in preliminary discussions with various parties, including state attorneys general, regarding possible resolution structures. In addition, 39 state attorneys general have formed a multi-state task force to investigate the manufacturing, distribution, dispensing and prescribing practices of opioid medications. We have received requests related to this multi-state investigation, as well as civil investigative demands, subpoenas or requests for information from these and other state attorneys general offices. We are cooperating with the offices conducting these investigations. We are vigorously defending ourselves in all of these opioid matters. Since all of the above-referenced lawsuits and investigations are in early stages, we are unable to predict their outcome or estimate a range of reasonably possible losses. Product Liability Lawsuits As of August 20, 2018, we are named as a defendant in 174 product liability lawsuits filed in Alameda County Superior Court in California involving claims by approximately 1,918 plaintiffs that allege personal injuries associated with the use of Cordis OptEase and TrapEase inferior vena cava (IVC) filter products. Another 20 lawsuits involving similar claims by approximately 21 plaintiffs are pending in other jurisdictions. These lawsuits seek a variety of remedies, including unspecified monetary damages. We are vigorously defending ourselves in these lawsuits. At June 30, 2018, we had a total of $259 million , net of expected insurance recoveries, accrued for losses and legal defense costs related to the Cordis IVC filter lawsuits. While we have recorded accruals based on our assessment of these matters, because these lawsuits are in early stages, we are unable to estimate a range of reasonably possible losses in excess of this accrued amount. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 11. Fair Value Measurements The following tables present the fair values for assets and (liabilities) measured on a recurring basis at June 30: 2018 (in millions) Level 1 Level 2 Level 3 Total Assets: Cash equivalents $ 200 $ — $ — $ 200 Other investments (2) 117 — — 117 Liabilities: Contingent consideration (3) — — (1 ) (1 ) Forward contracts (4) — (76 ) — (76 ) 2017 (in millions) Level 1 Level 2 Level 3 Total Assets: Cash equivalents $ 739 $ — $ — $ 739 Available-for-sale securities (1) — 65 — 65 Other investments (2) 116 — — 116 Liabilities: Contingent consideration (3) — — (32 ) (32 ) Forward contracts (4) — (21 ) — (21 ) (1) We invest in marketable securities, which are classified as available-for-sale and are carried at fair value in the consolidated balance sheets. Observable Level 2 inputs such as quoted prices for similar securities, interest rate spreads, yield curves and credit risk are used to determine the fair value. See Note 6 for additional information regarding available-for-sale securities. (2) Level 1 other investments balance includes investments in mutual funds, which are used to offset fluctuations in deferred compensation liabilities. These mutual funds primarily invest in the equity securities of companies with large market capitalization and high quality fixed income debt securities. The fair value of these investments is determined using quoted market prices. (3) Contingent consideration represents the obligations incurred in connection with acquisitions. We do not deem the fair value of the contingent consideration obligations under any single acquisition to be significant. The estimate of fair value of the contingent consideration obligations requires subjective assumptions to be made regarding future business results, discount rates, discount periods, and probabilities assigned to various potential business result scenarios and was determined using probability assessments with respect to the likelihood of reaching various targets or of achieving certain milestones. The fair value measurement is based on significant inputs unobservable in the market and thus represents a Level 3 measurement. Changes in current expectations of progress could change the probability of achieving the targets within the measurement periods and result in an increase or decrease in the fair value of the contingent consideration obligation. (4) The fair value of interest rate swaps, foreign currency contracts and commodity contracts is determined based on the present value of expected future cash flows considering the risks involved, including non-performance risk, and using discount rates appropriate for the respective maturities. Observable Level 2 inputs are used to determine the present value of expected future cash flows. The fair value of these derivative contracts, which are subject to master netting arrangements under certain circumstances, is presented on a gross basis in the consolidated balance sheets. The following table presents those liabilities measured at fair value on a recurring basis using unobservable inputs (Level 3): (in millions) Contingent Consideration Obligation Balance at June 30, 2016 $ 19 Additions from acquisitions 21 Changes in fair value of contingent consideration (1) (5 ) Payment of contingent consideration (3 ) Balance at June 30, 2017 32 Additions from acquisitions 5 Changes in fair value of contingent consideration (1) (2 ) Payment of contingent consideration (35 ) Balance at June 30, 2018 $ 1 The sum of the components may not equal the total due to rounding. (1) Amount is included in amortization and other acquisition-related costs in the consolidated statements of earnings. |
Financial Instruments
Financial Instruments | 12 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial Instruments | 12. Financial Instruments We utilize derivative financial instruments to manage exposure to certain risks related to our ongoing operations. The primary risks managed through the use of derivative instruments include interest rate risk, currency exchange risk, and commodity price risk. We do not use derivative instruments for trading or speculative purposes. While the majority of our derivative instruments are designated as hedging instruments, we also enter into derivative instruments that are designed to hedge a risk, but are not designated as hedging instruments. These derivative instruments are adjusted to current fair value through earnings at the end of each period. We are exposed to counterparty credit risk on all of our derivative instruments. Accordingly, we have established and maintain strict counterparty credit guidelines and only enter into derivative instruments with major financial institutions that are investment grade or better. We do not have significant exposure to any one counterparty and we believe the risk of loss is remote. Additionally, we do not require collateral under these agreements. Interest Rate Risk Management We are exposed to the impact of interest rate changes. Our objective is to manage the impact of interest rate changes on cash flows and the market value of our borrowings. We utilize a mix of debt maturities along with both fixed-rate and variable-rate debt to manage changes in interest rates. In addition, we enter into interest rate swaps to further manage our exposure to interest rate variations related to our borrowings and to lower our overall borrowing costs. Currency Exchange Risk Management We conduct business in several major international currencies and are subject to risks associated with changing foreign exchange rates. Our objective is to reduce earnings and cash flow volatility associated with foreign exchange rate changes to allow management to focus its attention on business operations. Accordingly, we enter into various contracts that change in value as foreign exchange rates change to protect the value of existing foreign currency assets and liabilities, commitments and anticipated foreign currency revenue and expenses. Commodity Price Risk Management We are exposed to changes in the price of certain commodities. Our objective is to reduce earnings and cash flow volatility associated with forecasted purchases of these commodities to allow management to focus its attention on business operations. Accordingly, we enter into derivative contracts when possible to manage the price risk associated with certain forecasted purchases. The following table summarizes the fair value of our assets and liabilities related to derivatives designated as hedging instruments and the respective line items in which they were recorded in the consolidated balance sheets at June 30: (in millions) 2018 2017 Assets: Foreign currency contracts (1) $ 3 $ 3 Commodity contracts (1) 2 — Total assets $ 5 $ 3 Liabilities: Foreign currency contracts (3) $ 3 $ 2 Pay-floating interest rate swaps (2) 78 19 Pay-floating interest rate swaps (3) $ — $ 2 Commodity contracts (3) — 1 Total liabilities $ 81 $ 24 (1) Included in prepaid expenses and other in the consolidated balance sheets. (2) Included in deferred income taxes and other liabilities in the consolidated balance sheets. (3) Included in other accrued liabilities in the consolidated balance sheets. Fair Value Hedges We enter into pay-floating interest rate swaps to hedge the changes in the fair value of fixed-rate debt resulting from fluctuations in interest rates. These contracts are designated and qualify as fair value hedges. Accordingly, the gain or loss recorded on the pay-floating interest rate swaps is directly offset by the change in fair value of the underlying debt. Both the derivative instrument and the underlying debt are adjusted to market value at the end of each period with any resulting gain or loss recorded in interest expense, net in the consolidated statements of earnings. During fiscal 2018 and 2017 we entered into pay-floating interest rate swaps with total notional amounts of $1.1 billion and $700 million , respectively. These swaps have been designated as fair value hedges of our fixed rate debt and are included in deferred income taxes and other liabilities in the consolidated balance sheets. During fiscal 2017 we terminated notional amounts of $600 million of pay-floating interest rate swaps that were previously designated as fair value hedges. During fiscal 2018 and 2017 , $550 million and $250 million , respectively, of pay-floating interest rate swaps matured. The following tables summarize the outstanding interest rate swaps designated as fair value hedges at June 30: 2018 (in millions) Notional Amount Maturity Date Pay-floating interest rate swaps $ 2,313 Nov 2019 - Sep 2025 2017 (in millions) Notional Amount Maturity Date Pay-floating interest rate swaps $ 1,813 Jun 2018 - Sep 2025 The following table summarizes the gain/(loss) recognized in earnings for interest rate swaps designated as fair value hedges: (in millions) 2018 2017 2016 Pay-floating interest rate swaps (1) $ 11 $ 17 $ 23 Fixed-rate debt (1) (11 ) (17 ) (23 ) (1) Included in interest expense, net in the consolidated statements of earnings. There was no ineffectiveness associated with these derivative instruments for any periods presented. Cash Flow Hedges We enter into derivative instruments to hedge our exposure to changes in cash flows attributable to interest rate, foreign currency and commodity price fluctuations associated with certain forecasted transactions. These derivative instruments are designated and qualify as cash flow hedges. Accordingly, the effective portion of the gain or loss on the derivative instrument is reported as a component of other comprehensive income and reclassified into earnings in the same line item associated with the forecasted transaction and in the same period during which the hedged transaction affects earnings. The ineffective portion of the gain or loss on the derivative instrument is recognized in earnings immediately. During fiscal 2017 we entered into forward interest rate swaps with a total notional amount of $700 million to hedge probable, but not firmly committed, future transactions associated with our debt. During fiscal 2017 we terminated $1.0 billion in forward interest rate swaps that were previously designated as cash-flow hedges. We enter into foreign currency contracts to protect the value of anticipated foreign currency revenues and expenses. At June 30, 2018 and 2017 , we held contracts to hedge probable, but not firmly committed, revenue and expenses. The principal currencies hedged are the Canadian dollar, Thai baht, Euro, and Mexican peso. We enter into commodity contracts to manage the price risk associated with forecasted purchases of certain commodities used in our Medical segment. The following tables summarize the outstanding cash flow hedges at June 30: 2018 (in millions) Notional Amount Maturity Date Foreign currency contracts $ 124 Jul 2018 - Jun 2019 Commodity contracts 12 Jul 2018 - Oct 2020 2017 (in millions) Notional Amount Maturity Date Foreign currency contracts $ 162 Jul 2017 - Jun 2018 Commodity contracts 17 Jul 2017 - Apr 2020 The following table summarizes the gain/(loss) included in AOCI for derivative instruments designated as cash flow hedges at June 30: (in millions) 2018 2017 Commodity contracts 2 (1 ) Foreign currency contracts (2 ) — The following table summarizes the gain/(loss) reclassified from AOCI into earnings for derivative instruments designated as cash flow hedges: (in millions) 2018 2017 2016 Foreign currency contracts (1) $ 1 $ (1 ) $ 1 Foreign currency contracts (2) — (1 ) 5 Foreign currency contracts (3) (2 ) 2 (3 ) Commodity contracts (3) — (3 ) (5 ) (1) Included in revenue in the consolidated statements of earnings. (2) Included in cost of products sold in the consolidated statements of earnings. (3) Included in SG&A expenses in the consolidated statements of earnings. The amount of ineffectiveness associated with these derivative instruments was immaterial for all periods presented. Economic (Non-Designated) Hedges We enter into foreign currency contracts to manage our foreign exchange exposure related to sales transactions, intercompany financing transactions and other balance sheet items subject to revaluation that do not meet the requirements for hedge accounting treatment. Accordingly, these derivative instruments are adjusted to current market value at the end of each period through earnings. The gain or loss recorded on these instruments is substantially offset by the remeasurement adjustment on the foreign currency denominated asset or liability. The settlement of the derivative instrument and the remeasurement adjustment on the foreign currency denominated asset or liability are both recorded in other (income)/expense, net. The principal currencies managed through foreign currency contracts are the Euro, Canadian dollar, British pound, Japanese yen, and Chinese renminbi. The following tables summarize the outstanding economic (non-designated) derivative instruments at June 30: 2018 (in millions) Notional Amount Maturity Date Foreign currency contracts $ 550 Jul 2018 - Jun 2019 2017 (in millions) Notional Amount Maturity Date Foreign currency contracts $ 558 Jul 2017 The following table summarizes the gain/(loss) recognized in earnings for economic (non-designated) derivative instruments: (in millions) 2018 2017 2016 Foreign currency contracts (1) $ (5 ) $ (5 ) $ (17 ) (1) Included in other income, net in the consolidated statements of earnings. Fair Value of Financial Instruments The carrying amounts of cash and equivalents, trade receivables, net, accounts payable, and other accrued liabilities at June 30, 2018 and 2017 approximate fair value due to their short-term maturities. The following table summarizes the estimated fair value of our long-term obligations and other short-term borrowings compared to the respective carrying amounts at June 30: (in millions) 2018 2017 Estimated fair value $ 8,852 $ 10,713 Carrying amount 9,013 10,395 The fair value of our long-term obligations and other short-term borrowings is estimated based on either the quoted market prices for the same or similar issues or other inputs derived from available market information, which represents a Level 2 measurement. The following table is a summary of the fair value gain/(loss) of our derivative instruments based upon the estimated amount that we would receive (or pay), considering counter-party credit risk, to terminate the contracts at June 30: 2018 2017 (in millions) Notional Fair Value Notional Fair Value Pay-floating interest rate swaps $ 2,313 $ (78 ) $ 1,813 $ (19 ) Foreign currency contracts 674 — 720 1 Commodity contracts 12 — 17 (1 ) |
Redeemable Noncontrolling Inter
Redeemable Noncontrolling Interests | 12 Months Ended |
Jun. 30, 2018 | |
Temporary Equity [Abstract] | |
Redeemable Noncontrolling Interests | 13. Redeemable Noncontrolling Interests In connection with the acquisition of a 71 percent ownership interest in naviHealth during fiscal 2016 , we recognized redeemable noncontrolling interests with a fair value of $119 million at the acquisition date. In August 2017, certain third-party noncontrolling interest holders exercised their put right on the noncontrolling interest representing 16 percent of naviHealth with a redemption value of $ 103 million and a carrying value of $ 109 million . We settled the put in September 2017 and our ownership in naviHealth increased to 98 percent , up from 82 percent at June 30, 2017 and 2016. In June 2018, we entered into a Securities Purchase Agreement and related Contribution and Rollover Agreement to sell our 98 percent ownership interest in naviHealth, which closed on August 1, 2018. See Note 4 and Note 19 for more information. The reconciliation of the changes in redeemable noncontrolling interests are as follows: (in millions) Redeemable Noncontrolling Interests Balance at June 30, 2016 $ 117 Net earnings attributable to redeemable noncontrolling interests 4 Net purchase of redeemable noncontrolling interests (3 ) Balance at June 30, 2017 118 Net earnings attributable to redeemable noncontrolling interest 2 Net purchase of redeemable noncontrolling interests (103 ) Adjustment of redeemable noncontrolling interests to redemption value (5 ) Balance at June 30, 2018 $ 12 |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Jun. 30, 2018 | |
Equity [Abstract] | |
Shareholders' Equity | 14. Shareholders' Equity At June 30, 2018 and 2017 , authorized capital shares consisted of the following: 750 million Class A common shares, without par value; 5 million Class B common shares, without par value; and 500 thousand non-voting preferred shares, without par value. The Class A common shares and Class B common shares are collectively referred to below as “common shares”. Holders of common shares are entitled to share equally in any dividends declared by the Board of Directors and to participate equally in all distributions of assets upon liquidation. Generally, the holders of Class A common shares are entitled to one vote per share, and the holders of Class B common shares are entitled to one-fifth of one vote per share on proposals presented to shareholders for vote. Under certain circumstances, the holders of Class B common shares are entitled to vote as a separate class. Only Class A common shares were outstanding at June 30, 2018 and 2017 . We repurchased $1.8 billion of our common shares, in the aggregate, through share repurchase programs during fiscal 2018 , 2017 and 2016 , as described below. We funded the repurchases with available cash and short term borrowings. The common shares repurchased are held in treasury to be used for general corporate purposes. During fiscal 2018 , we repurchased 8.4 million common shares having an aggregate cost of $550 million . The average price paid per common share was $65.30 . These repurchases include $300 million purchased under an accelerated share repurchase ("ASR") program, which began on February 14, 2018 and was completed on March 21, 2018. We repurchased 4.3 million shares under the ASR at an average price paid per share of $69.26 . During fiscal 2017 , we repurchased 8.1 million common shares having an aggregate cost of $600 million . The average price paid per common share was $74.08 . During fiscal 2016 , we repurchased 8.2 million common shares having an aggregate cost of $651 million . The average price paid per common share was $78.98 . During fiscal 2017 , we retired 37 million common shares in treasury. The retirement of these shares had no impact on total shareholders' equity; however, it did impact certain individual components of shareholders' equity as follows: $2.5 billion decrease in common shares in treasury, $302 million decrease in common shares, and $2.2 billion decrease in retained earnings. Accumulated Other Comprehensive Income/(Loss) The following table summarizes the changes in the balance of accumulated other comprehensive income/(loss) by component and in total: (in millions) Foreign Currency Translation Adjustments and other Unrealized Gain/(Loss) on Derivatives, net of tax Accumulated Other Comprehensive Income/(Loss) Balance at June 30, 2016 $ (123 ) $ 7 $ (116 ) Other comprehensive income/(loss), net before reclassifications (25 ) 19 (6 ) Amounts reclassified to earnings — (3 ) (3 ) Total other comprehensive loss attributable to Cardinal Health, Inc., net of tax of $9 million (25 ) 16 (9 ) Balance at June 30, 2017 (148 ) 23 (125 ) Other comprehensive income/(loss), before reclassifications 58 — 58 Amounts reclassified to earnings (23 ) (2 ) (25 ) Total comprehensive income/(loss) attributable to Cardinal Health, Inc., net of tax of $1 million 35 (2 ) 33 Balance at June 30, 2018 $ (113 ) $ 21 $ (92 ) Activity related to realized and unrealized gains and losses on available-for-sale securities, as described in Note 6 , was immaterial during fiscal 2018 and 2017 . |
Earnings Per Share Attributable
Earnings Per Share Attributable to Cardinal Health, Inc. | 12 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share Attributable to Cardinal Health, Inc. | 15. Earnings Per Share Attributable to Cardinal Health, Inc. The following table reconciles the computation of basic and diluted earnings per share attributable to Cardinal Health, Inc.: (in millions, except per share amounts) 2018 2017 2016 Net earnings $ 259 $ 1,294 $ 1,431 Net earnings attributable to noncontrolling interest (3 ) (6 ) (4 ) Net earnings attributable to Cardinal Health, Inc. $ 256 $ 1,288 $ 1,427 Weighted-average common shares–basic 313 317 327 Effect of dilutive securities: Employee stock options, restricted share units, and performance share units 2 3 3 Weighted-average common shares–diluted 315 320 330 Basic earnings per common share attributable to Cardinal Health, Inc.: $ 0.82 $ 4.06 $ 4.36 Diluted earnings per common share attributable to Cardinal Health, Inc.: 0.81 4.03 4.32 The potentially dilutive employee stock options, restricted share units and performance share units that were antidilutive for fiscal 2018 , 2017 and 2016 were 6 million , 3 million and 2 million , respectively. |
Segment Information
Segment Information | 12 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | 16. Segment Information Our operations are principally managed on a products and services basis and are comprised of two operating segments, which are the same as our reportable segments: Pharmaceutical and Medical. The factors for determining the reportable segments include the manner in which management evaluates performance for purposes of allocating resources and assessing performance combined with the nature of the individual business activities. The Pharmaceutical segment distributes branded and generic pharmaceutical, specialty pharmaceutical and over-the-counter healthcare and consumer products in the United States. This segment also provides services to pharmaceutical manufacturers and healthcare providers to support the development, marketing, and distribution of specialty pharmaceutical products; operates nuclear pharmacies and radiopharmaceutical manufacturing facilities; provides pharmacy management services to hospitals as well as medication therapy management and patient outcomes services to hospitals, other healthcare providers and payers; and repackages generic pharmaceuticals and over-the-counter healthcare products. Our Medical segment manufactures, sources and distributes Cardinal Health branded medical, surgical and laboratory products, which are sold in the United States, Canada, Europe, Asia and other markets. We further expanded this segment's portfolio of manufactured products through the acquisition of the Patient Recovery Business from Medtronic in July 2017, which includes incontinence, wound care, enteral feeding, urology, operating room supply, electrode and needle, syringe and sharps disposal product lines. In addition to distributing Cardinal Health branded products, this segment also distributes a broad range of national brand products and provides supply chain services and solutions to hospitals, ambulatory surgery centers, clinical laboratories and other healthcare providers in the United States and Canada . The following table presents revenue for each reportable segment and Corporate: (in millions) 2018 2017 2016 Pharmaceutical $ 121,241 $ 116,463 $ 109,131 Medical 15,581 13,524 12,430 Total segment revenue 136,822 129,987 121,561 Corporate (1) (13 ) (11 ) (15 ) Total revenue $ 136,809 $ 129,976 $ 121,546 (1) Corporate revenue consists of the elimination of inter-segment revenue and other revenue not allocated to the segments. We evaluate segment performance based on segment profit, among other measures. Segment profit is segment revenue, less segment cost of products sold, less segment distribution, selling, general, and administrative ("SG&A") expenses. Segment SG&A expenses include share-based compensation expense as well as allocated corporate expenses for shared functions, including corporate management, corporate finance, financial and customer care shared services, human resources, information technology, and legal and compliance. The results attributable to noncontrolling interests of consolidated entities are recorded within segment profit. Corporate expenses are allocated to the segments based on headcount, level of benefit provided, and other ratable allocation methodologies. We do not allocate the following items to our segments: LIFO inventory charges/(credits); restructuring and employee severance; amortization and other acquisition-related costs; impairments and (gain)/loss on disposal of assets; litigation (recoveries)/charges, net; other income/expense, net; interest expense, net; loss on extinguishment of debt; and provision for/(benefit from) income taxes. In addition, certain investment spending, certain portions of enterprise-wide incentive compensation, and other spending are not allocated to the segments. Investment spending generally includes the first-year spend for certain projects that require incremental investments in the form of additional operating expenses. We encourage our segments and corporate functions to identify investment projects that will promote innovation and provide future returns. As approval decisions for such projects are dependent upon executive management, the expenses for such projects are often retained at Corporate. Investment spending within Corporate was $43 million , $17 million and $34 million for fiscal 2018 , 2017 and 2016 , respectively. The following tables present segment profit by reportable segment and Corporate: (in millions) 2018 2017 2016 Pharmaceutical $ 1,992 $ 2,187 $ 2,488 Medical 662 572 457 Total segment profit 2,654 2,759 2,945 Corporate (2,528 ) (639 ) (486 ) Total operating earnings $ 126 $ 2,120 $ 2,459 The following tables present depreciation and amortization and additions to property and equipment by reportable segment and Corporate: (in millions) 2018 2017 2016 Pharmaceutical $ 156 $ 122 $ 128 Medical 278 156 136 Corporate 598 439 377 Total depreciation and amortization $ 1,032 $ 717 $ 641 (in millions) 2018 2017 2016 Pharmaceutical $ 58 $ 50 $ 88 Medical 127 123 96 Corporate 199 214 281 Total additions to property and equipment $ 384 $ 387 $ 465 The following table presents total assets for each reportable segment and Corporate at June 30: (in millions) 2018 2017 2016 Pharmaceutical $ 21,421 $ 21,848 $ 20,662 Medical 16,066 10,688 10,236 Corporate 2,464 7,576 3,224 Total assets $ 39,951 $ 40,112 $ 34,122 The following tables present revenue and property and equipment, net by geographic area: (in millions) 2018 2017 2016 United States $ 132,526 $ 125,006 $ 116,864 International 4,283 4,970 4,682 Total revenue $ 136,809 $ 129,976 $ 121,546 (in millions) 2018 2017 2016 United States $ 1,950 $ 1,623 $ 1,558 International 537 256 238 Property and equipment, net $ 2,487 $ 1,879 $ 1,796 |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | 17. Share-Based Compensation We maintain stock incentive plans (collectively, the “Plans”) for the benefit of certain of our officers, directors and employees. At June 30, 2018 , 19 million shares remain available for future grants under the Amended Cardinal Health, Inc. 2011 Long-Term Incentive Plan ("2011 LTIP"). Under the 2011 LTIP's fungible share counting provisions, stock options are counted against the plan as one share for every share issued ; awards other than stock options are counted against the plan as two and one-half shares for every share issued . This means that only 8 million shares could be issued under awards other than stock options while 19 million shares could be issued under stock options. Shares are issued out of treasury shares when stock options are exercised and when restricted share units and performance share units vest. The following table provides total share-based compensation expense by type of award: (in millions) 2018 2017 2016 Restricted share unit expense $ 73 $ 69 $ 69 Employee stock option expense 22 19 21 Performance share unit expense (10 ) 8 21 Total share-based compensation expense $ 85 $ 96 $ 111 The total tax benefit related to share-based compensation was $23 million , $34 million and $38 million for fiscal 2018 , 2017 and 2016 , respectively. Restricted Share Units Restricted share units granted under the Plans generally vest in equal annual installments over three years . Restricted share units accrue cash dividend equivalents that are payable upon vesting of the awards. The following table summarizes all transactions related to restricted share units under the Plans: (in millions, except per share amounts) Restricted Share Units Weighted-Average Grant Date Fair Value per Share Nonvested at June 30, 2016 2 $ 71.73 Granted 1 82.34 Vested (1 ) 69.23 Canceled and forfeited — — Nonvested at June 30, 2017 2 76.72 Granted 1 65.97 Vested (1 ) 78.92 Canceled and forfeited — — Nonvested at June 30, 2018 2 $ 71.58 The following table provides additional data related to restricted share unit activity: (in millions) 2018 2017 2016 Total compensation cost, net of estimated forfeitures, related to nonvested restricted share and share unit awards not yet recognized, pre-tax $ 78 $ 73 $ 79 Weighted-average period in years over which restricted share and share unit cost is expected to be recognized (in years) 2 2 2 Total fair value of shares vested during the year $ 65 $ 64 $ 65 Stock Options Employee stock options granted under the Plans generally vest in equal annual installments over three years and are exercisable for a period up to ten years from the grant date. All stock options are exercisable at a price equal to the market value of the common shares underlying the option on the grant date. The following table summarizes all stock option transactions under the Plans: (in millions, except per share amounts) Stock Options Weighted-Average Exercise Price per Common Share Outstanding at June 30, 2016 7 $ 54.09 Granted 1 83.09 Exercised (2 ) 37.79 Canceled and forfeited — — Outstanding at June 30, 2017 6 63.44 Granted 2 66.39 Exercised (1 ) 43.12 Canceled and forfeited — — Outstanding at June 30, 2018 7 $ 64.50 Exercisable at June 30, 2018 5 $ 59.60 The following table provides additional detail related to stock options: (in millions, except per share amounts) 2018 2017 2016 Aggregate intrinsic value of outstanding options at period end $ 13 $ 109 $ 181 Aggregate intrinsic value of exercisable options at period end 13 106 161 Aggregate intrinsic value of exercised options 14 73 63 Net proceeds/(withholding) from share-based compensation (3 ) 26 6 Excess tax benefits from share based compensation 10 34 33 Total compensation cost, net of estimated forfeitures, related to unvested stock options not yet recognized, pre-tax 17 22 22 Total fair value of shares vested during the year 19 19 20 Weighted-average grant date fair value per stock option 13.50 16.67 17.40 (in years) 2018 2017 2016 Weighted-average remaining contractual life of outstanding options 7 7 6 Weighted-average remaining contractual life of exercisable options 5 6 5 Weighted-average period over which stock option compensation cost is expected to be recognized 2 2 2 Stock options are granted to our officers and certain employees. The fair values were estimated on the grant date using a lattice valuation model. We believe the lattice model provides reasonable estimates because it has the ability to take into account individual exercise patterns based on changes in our stock price and other variables, and it provides for a range of input assumptions, which are disclosed in the table below. The risk-free rate is based on the U.S. Treasury yield curve at the time of the grant. We analyzed historical data to estimate option exercise behaviors and employee terminations to be used within the lattice model. The expected life of the options granted was calculated from the option valuation model and represents the length of time in years that the options granted are expected to be outstanding. Expected volatilities are based on implied volatility from traded options on our common shares and historical volatility over a period of time commensurate with the contractual term of the option grant (up to ten years ). The following table provides the range of assumptions used to estimate the fair value of stock options: 2018 2017 2016 Risk-free interest rate 2.1% 1.4% - 2.0% 1.5% - 1.9% Expected volatility 25% 24% 23% Dividend yield 2.7% - 2.8% 2.2% - 2.5% 1.8% - 2.0% Expected life in years 7 7 7 Performance Share Units Performance share units vest over a three -year performance period based on achievement of specific performance goals. Based on the extent to which the targets are achieved, vested shares may range from zero to 200 percent of the target award amount. Performance share units accrue cash dividend equivalents that are payable upon vesting of the awards. The following table summarizes all transactions related to performance share units under the Plans (based on target award amounts): (in millions, except per share amounts) Performance Share Units Weighted-Average Grant Date Fair Value per Share Nonvested at June 30, 2016 0.8 $ 63.96 Granted 0.2 83.19 Vested (1) (0.4 ) 51.49 Canceled and forfeited — — Nonvested at June 30, 2017 0.6 77.83 Granted 0.2 66.43 Vested (2) (0.2 ) 71.57 Canceled and forfeited (0.2 ) — Nonvested at June 30, 2018 0.4 $ 66.13 (1) Vested at 170 percent of the target performance share units granted. (2) Vested at 133 percent of the target performance share units granted. The following table provides additional data related to performance share unit activity: (in millions) 2018 2017 2016 Total compensation cost, net of estimated forfeitures, related to nonvested performance share units not yet recognized, pre-tax $ 1 $ 13 $ 17 Weighted-average period over which performance share unit cost is expected to be recognized (in years) 2 2 2 Total fair value of shares vested during the year $ 14 $ 19 $ 16 Employee Retirement Savings Plans Substantially all of our domestic non-union employees are eligible to be enrolled in our company-sponsored contributory retirement savings plans, which include features under Section 401(k) of the Internal Revenue Code of 1986, and provide for matching and profit sharing contributions by us. Our contributions to the plans are determined by the Board of Directors subject to certain minimum requirements as specified in the plans. The total expense for our employee retirement savings plans was $129 million , $49 million and $84 million for fiscal 2018 , 2017 and 2016 , respectively. |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) | 12 Months Ended |
Jun. 30, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Quarterly Financial Data (Unaudited) | 18. Selected Quarterly Financial Data (Unaudited) The following is selected quarterly financial data for fiscal 2018 and 2017 . The sum of the quarters may not equal year-to-date due to rounding. (in millions, except per common share amounts) First Second Third Fourth Fiscal 2018 Revenue $ 32,641 $ 35,186 $ 33,633 $ 35,349 Gross margin (1) 1,672 1,861 1,913 1,735 Distribution, selling, general and administrative expenses 1,062 1,131 1,132 1,270 Net earnings/(loss) (2) 117 1,053 255 (1,166 ) Less: Net earnings attributable to noncontrolling interests (2 ) — — — Net earnings/(loss) attributable to Cardinal Health, Inc. 115 1,053 255 (1,166 ) Net earnings/(loss) attributable to Cardinal Health, Inc. per common share: Basic $ 0.36 $ 3.35 $ 0.81 $ (3.76 ) Diluted (3) 0.36 3.33 0.81 (3.76 ) (1) Gross margin was not impacted by LIFO benefit/(charges) in fiscal 2018. (2) During the fourth quarter of fiscal 2018, we recognized a goodwill impairment charge of $ 1.4 billion related to our Medical segment. There was no tax benefit related to this goodwill impairment charge. (3) Due to the net loss during the fourth quarter of fiscal 2018, dilutive potential common shares have not been included in the denominator of the dilutive per share computation due to their antidilutive effect. (in millions, except per common share amounts) First Second Third Fourth Fiscal 2017 Revenue $ 32,039 $ 33,150 $ 31,821 $ 32,966 Gross margin (4) 1,590 1,602 1,728 1,623 Distribution, selling, general and administrative expenses 920 910 960 983 Net earnings 310 324 382 278 Less: Net earnings attributable to noncontrolling interests (1 ) — (1 ) (4 ) Net earnings attributable to Cardinal Health, Inc. 309 324 381 274 Net earnings attributable to Cardinal Health, Inc. per common share: Basic $ 0.97 $ 1.02 $ 1.21 $ 0.87 Diluted 0.96 1.02 1.20 0.86 (4) Gross margin is impacted by LIFO benefit/(charges) of $ 9 million and $(9) million in the second and third quarter, respectively. We did not have LIFO benefits/(charges) in the fourth quarter. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Jun. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | 19. Subsequent Events In June 2018, we entered into a Securities Purchase Agreement and related Contribution and Rollover Agreement with investor entities controlled by CD&R. Pursuant to those agreements, on August 1, 2018, we sold our 98% ownership interest in naviHealth in exchange for proceeds of $736 million (after adjusting for certain fees and expenses) and a 44% equity interest in a partnership that owns 100% of the equity interest of naviHealth. We also have certain call rights to reacquire naviHealth. On August 16, 2018 we entered into an ASR program to purchase shares of our common stock for an aggregate purchase price of $ 600 million and received an initial delivery of 9.5 million shares of common stock using a reference price of $ 50.45 . The program is expected to conclude in the second quarter of fiscal 2019. |
Schedule II - Valuations and Qu
Schedule II - Valuations and Qualifying Accounts | 12 Months Ended |
Jun. 30, 2018 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Schedule II - Valuations and Qualifying Accounts | Cardinal Health, Inc. and Subsidiaries Schedule II - Valuation and Qualifying Accounts (1) (in millions) Balance at Beginning of Period Charged to Costs and Expenses (1) Charged to Other Accounts (2) Deductions (3) Balance at End of Period Fiscal 2018 Accounts receivable $ 137 $ 113 $ 1 $ (111 ) $ 139 Finance notes receivable 9 (2 ) — — 7 Sales returns and allowances 347 2,402 — (2,270 ) 479 Other 1 — — — 1 $ 494 $ 2,513 $ 1 $ (2,381 ) $ 626 Fiscal 2017 Accounts receivable $ 135 $ 59 $ 1 $ (58 ) $ 137 Finance notes receivable 19 3 — (13 ) 9 Sales returns and allowances 386 2,285 — (2,324 ) 347 Other 1 — — — 1 $ 541 $ 2,347 $ 1 $ (2,395 ) $ 494 Fiscal 2016 Accounts receivable $ 135 $ 72 $ 2 $ (74 ) $ 135 Finance notes receivable 14 6 — (1 ) 19 Sales returns and allowances 305 2,207 — (2,126 ) 386 Other 1 — — — 1 $ 455 $ 2,285 $ 2 $ (2,201 ) $ 541 (1) Fiscal 2018 , 2017 and 2016 include $3 million , $5 million and $5 million , respectively, for reserves related to customer pricing disputes, excluded from provision for bad debts on the consolidated statements of cash flows and classified as a reduction in revenue in the consolidated statements of earnings. (2) Recoveries of amounts provided for or written off in prior years were $1 million , $1 million and $2 million for fiscal 2018 , 2017 and 2016 , respectively. (3) Write-off of uncollectible accounts or actual sales returns. The sum of the components may not equal the total due to rounding. |
Basis of Presentation and Sum27
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation Our consolidated financial statements include the accounts of all majority-owned or controlled subsidiaries, and all significant intercompany transactions and amounts have been eliminated. To conform to the current year presentation, certain prior year amounts have been reclassified. The results of businesses acquired or disposed of are included in the consolidated financial statements from the date of the acquisition or up to the date of disposal, respectively. |
Use of Estimates | Use of Estimates Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The preparation of financial statements in accordance with GAAP requires us to make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Estimates, judgments and assumptions are used in the accounting and disclosure related to, among other items, allowance for doubtful accounts, inventory valuation and reserves, business combinations, goodwill and other intangible asset impairment, vendor reserves, loss contingencies, self-insurance accruals, income taxes and share-based compensation. Actual amounts could ultimately differ from these estimated amounts. |
Cash Equivalents | Cash Equivalents We consider liquid investments purchased with an initial maturity of three months or less to be cash equivalents. The carrying value of cash equivalents approximates fair value. |
Receivables | Receivables and Allowance for Doubtful Accounts Trade receivables are presented net of an allowance for doubtful accounts of $139 million and $137 million at June 30, 2018 and 2017 , respectively. An account is considered past due on the first day after its due date. In accordance with contract terms, we generally have the ability to charge customers service fees or higher prices if an account is considered past due. We regularly monitor past due accounts and establish appropriate reserves to cover potential losses, which are based primarily on historical collection rates and the credit worthiness of the customer. We write off any amounts deemed uncollectible against the established allowance for doubtful accounts. We provide financing to various customers. Such financing arrangements range from 1 year to 5 years at interest rates that are generally subject to fluctuation. Interest income on these arrangements is recognized as it is earned. The financings may be collateralized, guaranteed by third parties or unsecured. Finance notes, net and related accrued interest were $136 million (current portion $26 million ) and $171 million (current portion $53 million ) at June 30, 2018 and 2017 , respectively, and are included in other assets (current portion is included in prepaid expenses and other) in the consolidated balance sheets. Finance notes receivable allowance for doubtful accounts were $7 million and $9 million at June 30, 2018 and 2017 , respectively. We estimate an allowance for these financing receivables based on historical collection rates and the credit worthiness of the customer. We write off any amounts deemed uncollectible against the established allowance for doubtful accounts. |
Concentrations of Credit Risk | Concentrations of Credit Risk We maintain cash depository accounts with major banks, and we invest in high quality, short-term liquid instruments, and in marketable securities. Our short-term liquid instruments mature within three months and we have not historically incurred any related losses. Investments in marketable debt securities consist of a portfolio of high-grade instruments. Such investments are made only in instruments issued by highly-rated institutions, whose financial condition we monitor. We had none of these investments at June 30, 2018. Our trade receivables and finance notes and related accrued interest are exposed to a concentration of credit risk with certain large customers and with customers in the retail and healthcare sectors. Credit risk can be affected by changes in reimbursement and other economic pressures impacting the healthcare industry. With respect to customers in the retail and healthcare sectors, such credit risk is limited due to supporting collateral and the diversity of the customer base, including its wide geographic dispersion. We perform regular credit evaluations of our customers’ financial conditions and maintain reserves for losses through the established allowance for doubtful accounts. Historically, such losses have been within our expectations. Refer to the "Receivables and Allowance for Doubtful Accounts" section within this Note for additional information on the accounting treatment of reserves for allowance for doubtful accounts. |
Major Customers | Major Customers CVS Health Corporation ("CVS") and OptumRx, are our only customers that individually account for at least 10 percent of revenue and gross trade receivables. These customers are primarily serviced through our Pharmaceutical segment. The following table summarizes historical percent of revenue and gross trade receivables from CVS and OptumRx: Percent of Revenue Percent of Gross Trade Receivables at June 30 2018 2017 2016 2018 2017 CVS 25 % 23 % 25 % 22 % 20 % OptumRx 11 % 11 % 7 % 4 % 1 % Our pharmaceutical distribution contract with OptumRx began in fiscal 2016 and did not exceed 10 percent until fiscal 2017. We have entered into agreements with group purchasing organizations (“GPOs”) which act as purchasing agents that negotiate vendor contracts on behalf of their members. Vizient, Inc. and Premier, Inc. are our two largest GPO member relationships in terms of revenue. Sales to members of these two GPOs collectively accounted for 22 percent , 21 percent and 17 percent of revenue for fiscal 2018 , 2017 and 2016 , respectively. Our trade receivable balances are with individual members of the GPO, and therefore no significant concentration of credit risk exists with these types of arrangements |
Inventories | Inventories A substantial portion of our inventories ( 56 percent at both June 30, 2018 and 2017 ) are valued at the lower of cost, using the last-in, first-out ("LIFO") method, or market. These inventories are included within the core pharmaceutical distribution facilities of our Pharmaceutical segment (“distribution facilities”) and are primarily merchandise inventories. The LIFO method presumes that the most recent inventory purchases are the first items sold, so LIFO helps us better match current costs and revenue. We believe that the average cost method of inventory valuation provides a reasonable approximation of the current cost of replacing inventory within the distribution facilities. As such, the LIFO reserve is the difference between (a) inventory at the lower of LIFO cost or market and (b) inventory at replacement cost determined using the average cost method of inventory valuation. If we had used the average cost method of inventory valuation for all inventory within the distribution facilities, the value of our inventories would not have changed in fiscal 2018 or 2017 because inventories valued at LIFO were $92 million and $46 million higher than the average cost value at June 30, 2018 and 2017 , respectively. We do not record inventories in excess of replacement cost. As such, we did not record any changes in our LIFO reserve in fiscal 2018 and 2017 . Our remaining inventory that is not valued at the lower of LIFO or market is stated at the lower of cost, using the first-in, first-out method, or net realizable value. Net realizable value is defined as the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Inventories presented in the consolidated balance sheets are net of reserves for excess and obsolete inventory which were $147 million and $76 million at June 30, 2018 and 2017 , respectively. The increase in the reserves for excess and obsolete inventory during fiscal 2018 was driven by increased Cordis inventory reserves and the Patient Recovery acquisition. We reserve for inventory obsolescence using estimates based on historical experience, historical and projected sales trends, specific categories of inventory and age of on-hand inventory. |
Cash Discounts | Cash Discounts Manufacturer cash discounts are recorded as a component of inventory cost and recognized as a reduction of cost of products sold as inventory is sold. |
Property and Equipment | Property and Equipment Property and equipment are carried at cost less accumulated depreciation. Property and equipment held for sale are recorded at the lower of cost or fair value less cost to sell. When certain events or changes in operating conditions occur, an impairment assessment may be performed on the recoverability of the carrying amounts. Depreciation expense is computed using the straight-line method over the estimated useful lives of the assets, including capital lease assets which are depreciated over the terms of their respective leases. We generally use the following range of useful lives for our property and equipment categories: buildings and improvements— 3 to 39 years ; machinery and equipment— 3 to 20 years ; and furniture and fixtures— 3 to 7 years . We recorded depreciation and amortization expense of $446 million , $314 million and $277 million for fiscal 2018 , 2017 and 2016 , respectively. The following table presents the components of property and equipment, net at June 30: (in millions) 2018 2017 Land, building and improvements $ 2,115 $ 1,637 Machinery and equipment 3,006 2,860 Furniture and fixtures 139 130 Total property and equipment, at cost 5,260 4,627 Accumulated depreciation and amortization (2,773 ) (2,748 ) Property and equipment, net $ 2,487 $ 1,879 Repairs and maintenance expenditures are expensed as incurred. Interest on long-term projects is capitalized using a rate that approximates the weighted-average interest rate on long-term obligations, which was 4 percent at June 30, 2018 . The amount of capitalized interest was immaterial for all periods presented. |
Business Combinations | Business Combinations The assets acquired and liabilities assumed in a business combination, including identifiable intangible assets, are recorded at their estimated fair values as of the acquisition date. The excess of the purchase price over the estimated fair value of the identifiable net assets acquired is recorded as goodwill. We base the fair values of identifiable intangible assets on detailed valuations that require management to make significant judgments, estimates and assumptions. Critical estimates and assumptions include: expected future cash flows for customer relationships, trade names and other identifiable intangible assets; discount rates that reflect the risk factors associated with future cash flows; and estimates of useful lives. When an acquisition involves contingent consideration, we recognize a liability equal to the fair value of the contingent consideration obligation at the acquisition date. The estimate of fair value of a contingent consideration obligation requires subjective assumptions to be made regarding future business results, discount rates, discount periods and probabilities assigned to various potential business result scenarios. See Note 2 for additional information regarding our acquisitions. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Purchased goodwill and intangible assets with indefinite lives are not amortized, but instead are tested for impairment annually or when indicators of impairment exist. Purchased goodwill is tested for impairment at least annually. Qualitative factors are first assessed to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If it is determined that it is more likely than not that the fair value does not exceed the carrying amount, then a quantitative test is performed. The quantitative goodwill impairment test involves a comparison of the estimated fair value of the reporting unit to the respective carrying amount. Goodwill impairment testing involves judgment, including the identification of reporting units, qualitative evaluation of events and circumstances to determine if it is more likely than not that an impairment exists, and, if necessary, the estimation of the fair value of the applicable reporting unit. Our qualitative evaluation considers the weight of evidence and significance of all identified events and circumstances and most relevant drivers of fair value, both positive and negative, in determining whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. We have two operating segments, which are the same as our reportable segments: Pharmaceutical and Medical. These operating segments are comprised of divisions (components), for which discrete financial information is available. Components are aggregated into reporting units for purposes of goodwill impairment testing to the extent that they share similar economic characteristics. Our reporting units are: Pharmaceutical operating segment (excluding our Nuclear Pharmacy Services division); Nuclear Pharmacy Services division; Medical operating segment (excluding our Cardinal Health at Home division and naviHealth division) (“Medical Unit”); Cardinal Health at Home division; and naviHealth division. Fair value can be determined using market, income or cost-based approaches. Our determination of estimated fair value of the reporting units is based on a combination of the income-based and market-based approaches. Under the income-based approach, we use a discounted cash flow model in which cash flows anticipated over several future periods, plus a terminal value at the end of that time horizon, are discounted to their present value using an appropriate risk-adjusted rate of return. We use our internal forecasts to estimate future cash flows, which we believe are consistent with those of a market participant, and include an estimate of long-term growth rates based on our most recent views of the long-term outlook for each reporting unit. Actual results may differ materially from those used in our forecasts. We use discount rates that are commensurate with the risks and uncertainty inherent in the respective reporting units and in our internally-developed forecasts. Discount rates used in our reporting unit valuations ranged from 8.5 percent to 13.5 percent . Under the market-based approach, we determine fair value by comparing our reporting units to similar businesses or guideline companies whose securities are actively traded in public markets. We also use the guideline transaction method to determine fair value based on pricing multiples derived from the sale of companies that are similar to our reporting units. To further confirm fair value, we compare the aggregate fair value of our reporting units to our total market capitalization. Estimating the fair value of reporting units requires the use of estimates and significant judgments that are based on a number of factors including forecasted operating results. The use of alternate estimates and assumptions or changes in the industry or peer groups could materially affect the determination of fair value for each reporting unit and potentially result in goodwill impairment. We performed annual impairment testing in fiscal 2018 , 2017 and 2016 and with the exception of our Medical Unit in fiscal 2018, concluded that there were no impairments of goodwill as the estimated fair value of each reporting unit exceeded its carrying value. As discussed further in Note 5 of the "Notes to Consolidated Financial Statements," during the fourth quarter of fiscal 2018 we recognized a $1.4 billion goodwill impairment charge related to our Medical Unit, which is included in impairments and loss on disposal of assets in our consolidated statements of earnings. There was no tax benefit related to this goodwill impairment charge. The impairment test for indefinite-lived intangibles other than goodwill (primarily IPR&D) involves first assessing qualitative factors to determine if it is more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount. If so, then a quantitative test is performed to compare the estimated fair value of the indefinite-lived intangible asset to the respective asset's carrying amount. Our qualitative evaluation requires the use of estimates and significant judgments and considers the weight of evidence and significance of all identified events and circumstances and most relevant drivers of fair value, both positive and negative, in determining whether it is more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount. Intangible assets with finite lives, primarily customer relationships; trademarks, trade names and patents; and developed technology, are amortized using a combination of straight-line and accelerated methods based on the expected cash flows from the asset over their estimated useful lives. We review intangible assets with finite lives for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. Determining whether an impairment loss occurred requires a comparison of the carrying amount to the sum of the future forecasted undiscounted cash flows expected to be generated by the asset group. Actual results may differ materially from those used in our forecasts. |
Assets Held for Sale, Policy [Policy Text Block] | Assets Held for Sale We classify assets and liabilities (the “disposal group”) as held for sale when management commits to a plan to sell the disposal group in its present condition and at a price that is reasonable in relation to its current fair value. We also consider whether an active program to locate a buyer has been initiated and if it is probable that the sale will occur within one year without significant changes to the plan to sell. Upon classification of the disposal group as held for sale, we test the assets for impairment and cease related depreciation and amortization. |
Investments | Investments Investments in non-marketable equity securities are accounted for under either the cost or equity method of accounting and are included in other assets in the consolidated balance sheets. For investments in which we can exercise significant influence, we use the equity method of accounting. Our share of the earnings and losses was immaterial, both individually and in the aggregate, for all periods presented and is recorded in other income, net in the consolidated statements of earnings. We closely monitor our investments for other-than-temporary impairment by considering factors such as the operating performance of the investment and current economic and market conditions. Marketable securities are classified as available-for-sale and are carried at fair value in the consolidated balance sheets. Unrealized gains and losses on available-for-sale securities, net of applicable taxes, are included within shareholders’ equity in accumulated other comprehensive income ("AOCI"). We monitor these securities for other-than-temporary impairment by considering factors such as the duration that, and the extent to which, the fair value is below cost, the operating performance and credit worthiness of the issuer of the securities and current economic and market conditions. See Note 6 for additional information regarding available-for-sale securities. |
Vendor Reserves | Vendor Reserves In the ordinary course of business, our vendors may dispute deductions taken against payments otherwise due to them or assert other disputes. These disputes are researched and resolved based upon the findings of the research performed. At any given time, there are outstanding items in various stages of research and resolution. In determining appropriate reserves for areas of exposure with our vendors, we assess historical experience and current outstanding claims. We have established various levels of reserves based on the type of claim and status of review. Though the claim types are relatively consistent, we periodically refine our methodology by updating the reserve estimate percentages to reflect actual historical experience. The ultimate outcome of certain claims may be different than our original estimate and may require an adjustment. Adjustments to vendor reserves are included in cost of products sold. In addition, the reserve balance will fluctuate due to variations of outstanding claims from period-to-period, timing of settlements and specific vendor issues, such as bankruptcies. Vendor reserves were $45 million and $50 million at June 30, 2018 and 2017 , respectively, excluding third-party returns. See Third-Party Returns section within this Note for a description of third-party returns. |
Distribution Service Agreement and Other Vendor Fees | Distribution Services Agreement and Other Vendor Fees Our Pharmaceutical segment recognizes fees received from distribution services agreements and other fees received from vendors related to the purchase or distribution of the vendors’ inventory when those fees have been earned and we are entitled to payment. Since the benefit provided to a vendor is related to the purchase and distribution of the vendor’s inventory, we recognize the fees as a reduction in the carrying value of the inventory that generated the fees, and as such, a reduction of cost of products sold in our consolidated statements of earnings when the inventory is sold. |
Loss Contingencies | Loss Contingencies and Self-Insurance We accrue for contingencies related to disputes, litigation and regulatory matters if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We also self-insure for employee healthcare, general liability, certain product liability matters, auto liability, property and workers' compensation. Self-insurance accruals include an estimate for expected settlements or pending claims, defense costs, administrative fees, claim adjustment costs and an estimate for claims incurred but not reported. Because these matters are inherently unpredictable and unfavorable developments or resolutions can occur, assessing contingencies and other liabilities is highly subjective and requires judgments about future events. We regularly review contingencies and our self-insurance accruals to determine whether our accruals and related disclosures are adequate. The amount of ultimate loss may differ from these estimates. We recognize these estimated loss contingencies, income from favorable resolution of litigation and certain defense costs in litigation (recoveries)/charges in our consolidated statements of earnings. See Note 9 for additional information regarding loss contingencies a |
Income Taxes | Income Taxes We account for income taxes using the asset and liability method. Deferred tax assets and liabilities are measured using enacted tax rates in the respective jurisdictions in which we operate . We assess the realizability of deferred tax assets on a quarterly basis and provide a valuation allowance for deferred tax assets when it is more likely than not that at least a portion of the deferred tax assets will not be realized. The realizability of deferred tax assets depends on our ability to generate sufficient taxable income within the carryback or carryforward periods provided for in the tax law for each applicable tax jurisdiction and also considers all available positive and negative evidence. Deferred taxes for non-U.S. liabilities are not provided on the unremitted earnings of subsidiaries outside of the United States when it is expected that these earnings are indefinitely reinvested. Tax benefits from uncertain tax positions are recognized when it is more likely than not that the position will be sustained upon examination of the technical merits of the position, including resolutions of any related appeals or litigation processes. The amount recognized is measured as the largest amount of tax benefit that is greater than 50 percent likely of being realized upon settlement. See Note 8 for additional information regarding income taxes. |
Other Accrued Liabilities, Policy [Policy Text Block] | Other Accrued Liabilities Other accrued liabilities represent various current obligations, including certain accrued operating expenses and taxes payable. |
Noncontrolling Interests and Redeemable Noncontrolling Interests | Noncontrolling Interests and Redeemable Noncontrolling Interests Noncontrolling interests represent the portion of net earnings, comprehensive income and net assets that is not attributable to Cardinal Health, Inc. The redeemable noncontrolling interests relate to our ownership interest in naviHealth Holdings, LLC ("naviHealth"), which we acquired during fiscal 2016. The redeemable noncontrolling interests are redeemable at the option of the third-party noncontrolling interest holders at any time after the two-year anniversary of the closing, or earlier if a trigger event occurs. As such, the noncontrolling interests have been presented as redeemable noncontrolling interests in our consolidated balance sheets. The noncontrolling interests will be adjusted each period for net earnings and dividends attributable to the noncontrolling interests and changes in the noncontrolling ownership interests, if any. An additional adjustment to the carrying value of the noncontrolling interests may be required if the redemption value under the terms of the agreement exceeds the carrying value. Changes in the carrying value of the noncontrolling interests related to a change in the redemption value will be recorded through retained earnings and will not affect net earnings attributable to Cardinal Health, Inc. See Note 13 for additional information regarding redeemable noncontrolling interests. In June 2018, we signed a securities purchase agreement and a contribution and rollover agreement with investor entities controlled by Clayton, Dubilier & Rice ("CD&R") to sell our ownership interest in naviHealth. For more information on this divestiture see Note 4 . |
Share-Based Compensation | Share-Based Compensation Share-based compensation provided to employees is recognized in the consolidated statements of earnings based on the grant date fair value of the awards. The fair value of stock options is determined on the grant date using a lattice valuation model. The fair value of restricted share units and performance share units is determined by the grant date market price of our common shares. The compensation expense associated with nonvested performance share units is dependent on our periodic assessment of the probability of the targets being achieved and our estimate, which may vary over time, of the number of shares that ultimately will be issued. The compensation expense recognized for share-based awards is net of estimated forfeitures and is recognized ratably over the service period of the awards. All income tax effects of share-based awards are recognized in the statement of earnings as awards vest or are settled. We classify share-based compensation expense in distribution, selling, general and administrative ("SG&A") expenses to correspond with the same line item as the majority of the cash compensation paid to employees. If awards are modified in connection with a restructuring activity, the incremental share-based compensation expense is classified in restructuring and employee severance. See Note 17 for additional information regarding share-based compensation. |
Dividends, Policy [Policy Text Block] | Dividends We paid cash dividends per common share of $1.85 , $1.80 and $1.55 in fiscal 2018 , 2017 and 2016 , respectively. |
Revenue Recognition | Revenue Recognition We recognize revenue when persuasive evidence of an arrangement exists, product delivery has occurred or the services have been rendered, the price is fixed or determinable, and collectability is reasonably assured. Pharmaceutical Segment The Pharmaceutical segment recognizes distribution revenue when title transfers to its customers and we have no further obligation to provide services related to such merchandise. Revenue for deliveries that are directly shipped to customers from the manufacturer when we act as an intermediary in the ordering and delivery of products is recorded gross. This is in accordance with accounting standards addressing reporting revenue on a gross basis as a principal versus on a net basis as an agent. This revenue is recorded on a gross basis since we incur credit risk from the customer, are primarily responsible for fulfillment, bear the risk of loss for incomplete shipments and do not receive a separate fee or commission for the transaction and, as such, are the primary obligor. Revenue from these sales is recognized when title transfers to the customer and we have no further obligation to provide services related to such merchandise. Radiopharmaceutical revenue is recognized upon delivery of the product to the customer and we have no further obligation to provide services related to such merchandise. Medical Segment The Medical segment recognizes revenue when title transfers to its customers and we have no further obligation to provide services related to such products. |
Sales Returns and Allowances | Sales Returns and Allowances Revenue is recorded net of sales returns and allowances. Our customer return policies generally require that the product be physically returned, subject to restocking fees, in a condition suitable to be added back to inventory and resold at full value, or returned to vendors for credit (“merchantable product”). Product returns are generally consistent throughout the year and typically are not specific to any particular product or customer. We accrue for estimated sales returns and allowances at the time of sale based upon historical customer return trends, margin rates and processing costs. Our accrual for sales returns is reflected as a reduction of revenue and cost of products sold for the sales price and cost, respectively. At June 30, 2018 and 2017 , the accrual for estimated sales returns and allowances was $479 million and $347 million , respectively, the impact of which is reflected in trade receivables, net and inventories, net in the consolidated balance sheets. Sales returns and allowances were $2.4 billion , $2.3 billion and $2.2 billion , for fiscal 2018 , 2017 and 2016 , respectively. Third-Party Returns We generally do not accept non-merchantable pharmaceutical product returns from our customers, so many of our customers return non-merchantable pharmaceutical products to the manufacturer through third parties. Since our customers generally do not have a direct relationship with manufacturers, our vendors pass the value of such returns to us (usually in the form of an accounts payable deduction) for distribution to customers. We, in turn, pass the value received, less an administrative fee, to our customer. In certain instances, we pass the estimated value of the return to our customer prior to our receipt of the value from the vendor. Although we believe we have satisfactory protections, we could be subject to claims from customers or vendors if our administration of this overall process was deficient in some respect or our contractual terms with vendors are in conflict with our contractual terms with our customers. We have maintained reserves for some of these situations based on their nature and our historical experience with their resolution. |
Shipping and Handling | Shipping and Handling Shipping and handling costs are primarily included in SG&A expenses in our consolidated statements of earnings. Shipping and handling costs include all delivery expenses as well as all costs to prepare the product for shipment to the end customer. Shipping and handling costs were $543 million , $496 million and $504 million , for fiscal 2018 , 2017 and 2016 , respectively. Revenue received for shipping and handling was immaterial for all periods presented. |
Restructuring and Employee Severance | Restructuring and Employee Severance Restructuring activities are programs that are not part of the ongoing operations of our underlying business, such as closing and consolidating facilities, changing the way we manufacture or distribute our products, moving manufacturing of a product to another location, changes in production or business process outsourcing or insourcing, employee severance (including rationalizing headcount or other significant changes in personnel) and realigning operations (including realignment of the management structure in response to changing market conditions). See Note 3 for additional information regarding our restructuring activities. |
Amortization and Other Acquisition-Related Costs | Amortization and Other Acquisition-Related Costs We classify certain costs incurred in connection with acquisitions as amortization and other acquisition-related costs in our consolidated statements of earnings. These costs consist of amortization of acquisition-related intangible assets, transaction costs, integration costs and changes in the fair value of contingent consideration obligations. Transaction costs are incurred during the initial evaluation of a potential acquisition and primarily relate to costs to analyze, negotiate and consummate the transaction as well as due diligence activities. Integration costs relate to activities required to combine the operations of an acquired enterprise into our operations and, in the case of the Cordis and Patient Recovery businesses, to stand-up the systems and processes needed to support an expanded geographic footprint. We record changes in the fair value of contingent consideration obligations relating to acquisitions as income or expense in amortization and other acquisition-related costs. See Note 5 for additional information regarding amortization of acquisition-related intangible assets and Note 11 for additional information regarding contingent consideration. |
Translation of Foreign Currencies | Translation of Foreign Currencies Financial statements of our subsidiaries outside the United States are generally measured using the local currency as the functional currency. Adjustments to translate the assets and liabilities of these foreign subsidiaries into U.S. dollars are accumulated in shareholders’ equity through AOCI utilizing period-end exchange rates. Revenues and expenses of these foreign subsidiaries are translated using average exchange rates during the year. The foreign currency translation gains/(losses) included in AOCI at June 30, 2018 and 2017 are presented in Note 14 . Foreign currency transaction gains and losses for the period are included in the consolidated statements of earnings in the respective financial statement line item. |
Interest Rate, Currency and Commodity Risk | Interest Rate, Currency and Commodity Risk All derivative instruments are recognized at fair value on the consolidated balance sheets and all changes in fair value are recognized in net earnings or shareholders’ equity through AOCI, net of tax. For contracts that qualify for hedge accounting treatment, the hedge contracts must be effective at reducing the risk associated with the exposure being hedged and must be designated as a hedge at the inception of the contract. Hedge effectiveness is assessed periodically. Any contract not designated as a hedge, or so designated but ineffective, is adjusted to fair value and recognized immediately in net earnings. If a fair value or cash flow hedge ceases to qualify for hedge accounting treatment, the contract continues to be carried on the balance sheet at fair value until settled and future adjustments to the contract’s fair value are recognized immediately in net earnings. If a forecasted transaction is probable not to occur, amounts previously deferred in AOCI are recognized immediately in net earnings. See Note 12 for additional information regarding our derivative instruments, including the accounting treatment for instruments designated as fair value, cash flow and economic hedges. |
Fair Value Measurements | Fair Value Measurements Fair value is defined as the price that would be received upon selling an asset or the price paid to transfer a liability on the measurement date. It focuses on the exit price in the principal or most advantageous market for the asset or liability in an orderly transaction between willing market participants. A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair values are: Level 1 - Observable prices in active markets for identical assets and liabilities. Level 2 - Observable inputs other than quoted prices in active markets for identical assets and liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. See Note 11 for additional information regarding fair value measurements. |
Recent Financial Accounting Standards | Recent Financial Accounting Standards In March 2018, the Financial Accounting Standards Board (the "FASB") issued amended accounting guidance to codify guidance pursuant to SEC staff accounting bulletin 118 (“SAB 118”), which was issued in connection with the Tax Cuts and Jobs Act (the “Tax Act”) of December 2017. The guidance allows companies to use provisional estimates to record the effects of the Tax Act and also provides a measurement period (not to exceed one year from the date of enactment) to complete the accounting for the impacts of the Tax Act. We adopted this guidance in the second quarter of fiscal 2018 when it was initially issued as SAB 118. We are still completing our accounting for the tax effects of the Tax Act because all the necessary information is not currently available, prepared, or analyzed. As such, we have made reasonable estimates of the effects of the Tax Act on our financial results. As we complete our analysis of the accounting for the tax effects of enactment of the Tax Act, we may record additional provisional amounts or adjustments to provisional amounts as discrete items in future periods. See Note 8 for additional information regarding income taxes. In August 2017, the FASB issued accounting guidance which is intended to improve and simplify accounting rules around hedge accounting. The guidance will be effective for us in the first quarter of fiscal 2020 and early adoption is permitted. While we are currently evaluating the timing of adoption, we do not expect the impact of this standard to have a material impact on our consolidated financial statements. In March 2016, the FASB issued amended accounting guidance that changed the accounting for certain aspects of share-based compensation to employees. The guidance requires all income tax effects of share-based awards to be recognized in the statement of earnings as awards vest or are settled. Additionally, the guidance increases the amount employers can withhold in shares to cover employee income taxes without requiring liability classification and allows a policy election for accounting for forfeitures. The primary impact of adoption is the recognition of excess tax benefits in the statement of earnings on a prospective basis, rather than as a component of equity. The impact on the presentation in the consolidated statement of cash flows is also prospective. We adopted this guidance in the first quarter of fiscal 2018. The impact of adoption on the provision for/(benefit from) income taxes on our consolidated statement of earnings was immaterial. The inclusion of excess tax benefits and deficiencies as a component of our income tax expense will increase volatility within our provision for/(benefit from) income taxes as the amount of excess tax benefits or deficiencies from share- based compensation awards depends on our stock price at the date the awards vest or settle. In February 2016, the FASB issued amended accounting guidance that requires lessees to recognize most leases on the balance sheet as a lease liability and corresponding right-of-use asset. The guidance also requires disclosures that meet the objective of enabling financial statement users to assess the amount, timing, and uncertainty of cash flows arising from leases. This guidance will be effective for us in the first quarter of fiscal 2020 and we expect to elect the practical expedient which will allow us to not apply the amended lease accounting guidance to comparative periods that will be presented. The majority of our lease spend relates to certain real estate with the remaining lease spend primarily related to equipment. We are continuing to evaluate the impact of this standard on our consolidated financial statements and the methods of adoption. In May 2014, the FASB issued amended accounting guidance related to revenue recognition which is effective for us in the first quarter of fiscal 2019. This guidance is based on the principle that revenue is recognized in an amount that reflects the consideration to which an entity expects to be entitled in exchange for the transfer of goods or services to customers. The guidance also requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The FASB also subsequently issued several amendments to the standard, including clarification on principal versus agent considerations, performance obligations and licensing, and certain scope improvements and practical expedients. During fiscal 2018 we finalized our evaluation and assessment of the amended revenue recognition guidance. Our revenue is primarily distribution revenue, which we recognize at a point in time when title transfers to customers and we have no further obligation to provide services related to such merchandise. The timing of recognition of our distribution revenue will be unchanged under the amended guidance. The adoption of the amended accounting guidance will not have a material impact on our consolidated financial statements. In May 2017, the FASB issued final guidance that clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. Entities will apply the modification accounting guidance if the value, vesting conditions or classification of the award changes. This guidance will be effective for us in the first quarter of fiscal 2019 and the impact of this new guidance is dependent on future events. In February 2017, the FASB clarified the guidance on how to account for the derecognition of nonfinancial assets (e.g., real estate, land, buildings, intangibles) and in-substance nonfinancial assets once an entity adopts the new revenue recognition guidance that is discussed in more detail above. The guidance also defines what constitutes an in-substance nonfinancial asset. This guidance will be effective for us in the first quarter of fiscal 2019. We anticipate the adoption of this guidance will not impact our consolidated financial statements. In January 2017, the FASB issued amended accounting guidance that simplifies the accounting for goodwill impairment by eliminating the step of measuring a goodwill impairment by estimating the implied fair value of goodwill. Instead, goodwill impairment will be measured as the amount by which the reporting unit’s carrying value exceeds its fair value, limited to the carrying value of the goodwill. We adopted this guidance in the second quarter of fiscal 2018. During the fourth quarter of fiscal 2018, we measured the Medical Unit's impairment at the amount by which the reporting unit's carrying value exceeded its fair value, resulting in an impairment charge of $1.4 billion . Refer to Note 5 for further discussion. Also in January 2017, the FASB issued new accounting guidance that changes the definition of a business when evaluating whether a set of transferred assets and activities is considered a business. This guidance will be effective for us in the first quarter of fiscal 2019. The impact of adoption is dependent on future events. In October 2016, the FASB issued amended accounting guidance that requires an entity to recognize the income tax effect of intercompany sales and transfers of assets other than inventory at the time that the transfer occurs rather than when the asset is sold to a third party. This amendment will be effective for us in the first quarter of fiscal 2019. We are currently evaluating the impact of this standard on our consolidated financial statements. In August 2016, the FASB issued accounting guidance which clarifies the classification of certain cash receipts and cash payments in the statement of cash flows, including those related to contingent consideration payments made after a business combination, distributions received from equity method investees, debt prepayment or debt extinguishment costs and proceeds from the settlement of insurance claims. This guidance will be effective for us in the first quarter of fiscal 2019. We are currently evaluating the impact of this standard on our consolidated financial statements. In June 2016, the FASB issued amended accounting guidance that will require entities to measure credit losses on trade and other receivables, held-to-maturity debt securities, loans and other instruments using an "expected credit loss" model that considers historical experience, current conditions and reasonable supportable forecasts. This guidance also requires that credit losses on available-for-sale debt securities with unrealized losses be recognized as allowances rather than as deductions in the amortized cost of the securities. This guidance will be effective for us in the first quarter of fiscal 2021. We are currently evaluating the impact of adoption on our consolidated financial statements. |
Basis of Presentation and Sum28
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Revenue and Gross Trade Receivables Percentage by Major Customers | The following table summarizes historical percent of revenue and gross trade receivables from CVS and OptumRx: Percent of Revenue Percent of Gross Trade Receivables at June 30 2018 2017 2016 2018 2017 CVS 25 % 23 % 25 % 22 % 20 % OptumRx 11 % 11 % 7 % 4 % 1 % |
Components of Property and Equipment | The following table presents the components of property and equipment, net at June 30: (in millions) 2018 2017 Land, building and improvements $ 2,115 $ 1,637 Machinery and equipment 3,006 2,860 Furniture and fixtures 139 130 Total property and equipment, at cost 5,260 4,627 Accumulated depreciation and amortization (2,773 ) (2,748 ) Property and equipment, net $ 2,487 $ 1,879 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Business Combinations [Abstract] | |
Estimated Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the estimated fair value of the assets acquired and liabilities assumed as of the acquisition date for the Patient Recovery Business: (in millions) Patient Recovery Business Identifiable intangible assets: Customer relationships (1) $ 1,733 Trade names (2) 187 Developed technology and other (3) 732 Total identifiable intangible assets acquired 2,652 Cash and equivalents 22 Inventories 425 Prepaid expenses and other 252 Property and equipment, net 741 Other accrued liabilities (322 ) Deferred income taxes and other liabilities (982 ) Total identifiable net assets acquired/(liabilities assumed) 2,788 Goodwill 3,292 Total net assets acquired $ 6,080 (1) The range of useful lives for customer relationships is 10 to 18 years. (2) The useful life of trade names is 15 years. (3) The useful life of developed technology is 15 years. |
Restructuring and Employee Se30
Restructuring and Employee Severance (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Restructuring Charges [Abstract] | |
Summary of Restructuring and Employee Severance | The following tables summarize restructuring and employee severance costs: (in millions) 2018 2017 2016 Employee-related costs (1) $ 34 $ 51 $ 15 Facility exit and other costs (2) 142 5 10 Total restructuring and employee severance $ 176 $ 56 $ 25 (1) Employee-related costs primarily consist of termination benefits provided to employees who have been involuntarily terminated and duplicate payroll costs during transition periods. (2) Facility exit and other costs primarily consist of product distribution and lease contract termination costs, accelerated depreciation, equipment relocation costs, project consulting fees and costs associated with restructuring our delivery of information technology infrastructure services. |
Schedule of Activity Related to Liabilities Associated with Restructuring and Employee Severance | The following table summarizes activity related to liabilities associated with restructuring and employee severance: (in millions) Employee- Related Costs Facility Exit and Other Costs Total Balance at June 30, 2016 $ 15 $ 1 $ 16 Additions 43 1 44 Payments and other adjustments (17 ) (2 ) (19 ) Balance at June 30, 2017 41 — 41 Additions 19 131 150 Payments and other adjustments (36 ) (127 ) (163 ) Balance at June 30, 2018 $ 24 $ 4 $ 28 |
Divestitures and Assets Held 31
Divestitures and Assets Held for Sale (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Assets and Liabilities Classified as Held for Sale | The following table presents information related to the assets and liabilities that were classified as held for sale at June 30, 2018 in the consolidated balance sheets: (in millions) June 30, 2018 Trade Receivables, net $ 74 Goodwill and other intangibles, net 642 Other assets 40 Total assets held for sale $ 756 Deferred revenue 35 Deferred income taxes 38 Other liabilities 140 Total liabilities related to assets held for sale $ 213 |
Goodwill and Other Intangible32
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill by Reportable Segment | The following table summarizes the changes in the carrying amount of goodwill by segment and in total: (in millions) Pharmaceutical (1) Medical (2) Total Balance at June 30, 2016 $ 2,919 $ 4,248 $ 7,167 Goodwill acquired, net of purchase price adjustments 29 35 64 Foreign currency translation adjustments and other (9 ) (1 ) (10 ) Balance at June 30, 2017 2,939 4,282 7,221 Goodwill acquired, net of purchase price adjustments 1 3,342 3,343 Foreign currency translation adjustments and other 28 6 34 Goodwill divested with the sale of our China distribution business (347 ) (54 ) (401 ) naviHealth goodwill reclassified to assets held for sale — (509 ) (509 ) Impairment — (1,372 ) (1,372 ) Balance at June 30, 2018 $ 2,621 $ 5,695 $ 8,316 (1) At June 30, 2018 and 2017, the Pharmaceutical segment accumulated goodwill impairment loss was $829 million . |
Schedule of Finite-Lived Intangible Assets | The following tables summarize other intangible assets by class at June 30: 2018 (in millions) Gross Intangible Accumulated Amortization Net Intangible Weighted- Average Remaining Amortization Period (Years) Indefinite-life intangibles: IPR&D, trademarks and other $ 62 $ — $ 62 N/A Total indefinite-life intangibles 62 — 62 N/A Definite-life intangibles: Customer relationships 3,513 1,191 2,322 15 Trademarks, trade names and patents 667 246 421 15 Developed technology and other 1,562 454 1,108 12 Total definite-life intangibles 5,742 1,891 3,851 14 Total other intangible assets $ 5,804 $ 1,891 $ 3,913 N/A 2017 (in millions) Gross Intangible Accumulated Amortization Net Intangible Indefinite-life intangibles: IPR&D, trademarks and other $ 61 $ — $ 61 Total indefinite-life intangibles 61 — 61 Definite-life intangibles: Customer relationships 1,966 967 999 Trademarks, trade names and patents 509 195 314 Developed technology and other 916 304 612 Total definite-life intangibles 3,391 1,466 1,925 Total other intangible assets $ 3,452 $ 1,466 $ 1,986 |
Schedule of Indefinite-Lived Intangible Assets | The following tables summarize other intangible assets by class at June 30: 2018 (in millions) Gross Intangible Accumulated Amortization Net Intangible Weighted- Average Remaining Amortization Period (Years) Indefinite-life intangibles: IPR&D, trademarks and other $ 62 $ — $ 62 N/A Total indefinite-life intangibles 62 — 62 N/A Definite-life intangibles: Customer relationships 3,513 1,191 2,322 15 Trademarks, trade names and patents 667 246 421 15 Developed technology and other 1,562 454 1,108 12 Total definite-life intangibles 5,742 1,891 3,851 14 Total other intangible assets $ 5,804 $ 1,891 $ 3,913 N/A 2017 (in millions) Gross Intangible Accumulated Amortization Net Intangible Indefinite-life intangibles: IPR&D, trademarks and other $ 61 $ — $ 61 Total indefinite-life intangibles 61 — 61 Definite-life intangibles: Customer relationships 1,966 967 999 Trademarks, trade names and patents 509 195 314 Developed technology and other 916 304 612 Total definite-life intangibles 3,391 1,466 1,925 Total other intangible assets $ 3,452 $ 1,466 $ 1,986 |
Available-for-Sale Securities (
Available-for-Sale Securities (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Available-for-sale Securities | We held the following investments in marketable securities at fair value at June 30: (in millions) 2018 2017 Current available-for-sale securities: Treasury bills — 25 International bonds — 3 Corporate bonds — 30 U.S. agency bonds — 3 Asset-backed securities — 3 International equity securities — 1 Total available-for-sale securities $ — $ 65 |
Long-Term Obligations and Oth34
Long-Term Obligations and Other Short-Term Borrowings (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | The following table summarizes long-term obligations and other short-term borrowings at June 30: (in millions) (1) 2018 2017 1.7% Notes due 2018 $ — $ 400 1.95% Notes due 2018 — 547 1.948% Notes due 2019 998 996 2.4% Notes due 2019 448 453 4.625% Notes due 2020 514 519 2.616% Notes due 2022 1,143 1,142 3.2% Notes due 2022 243 248 Floating Rate Notes due 2022 348 347 3.2% Notes due 2023 525 544 3.079% Notes due 2024 742 744 3.5% Notes due 2024 390 396 3.75% Notes due 2025 460 481 3.41% Notes due 2027 1,340 1,340 4.6% Notes due 2043 346 346 4.5% Notes due 2044 342 341 4.9% Notes due 2045 445 445 4.368% Notes due 2047 594 594 7.0% Debentures due 2026 124 124 Other obligations 11 388 Total 9,013 10,395 Less: current portion of long-term obligations and other short-term borrowings 1,001 1,327 Long-term obligations, less current portion $ 8,012 $ 9,068 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Before Income Tax, Domestic and Foreign | The following table summarizes earnings/(loss) before income taxes: (in millions) 2018 2017 2016 U.S. operations $ 391 $ 1,772 $ 2,050 Non-U.S. operations (619 ) 152 226 Earnings/(loss) before income taxes $ (228 ) $ 1,924 $ 2,276 |
Schedule of Components of Income Tax Expense (Benefit), Current and Deferred | The following table summarizes the components of provision for/(benefit from) income taxes: (in millions) 2018 2017 2016 Current: Federal $ 341 $ 273 $ 633 State and local 41 10 52 Non-U.S. 143 56 73 Total current $ 525 $ 339 $ 758 Deferred: Federal $ (1,003 ) $ 258 $ 96 State and local 16 37 12 Non-U.S. (25 ) (4 ) (21 ) Total deferred (1,012 ) 291 87 Provision for/(benefit from) income taxes $ (487 ) $ 630 $ 845 |
Schedule of Effective Income Tax Rate Reconciliation | The following table presents a reconciliation of the provision based on the federal statutory income tax rate to our effective income tax rate: 2018 (1) 2017 (2) 2016 (2) Provision at Federal statutory rate 28.1 % 35.0 % 35.0 % State and local income taxes, net of federal benefit (16.0 ) 1.0 1.5 Foreign tax rate differential (48.4 ) (7.3 ) (0.6 ) Nondeductible/nontaxable items (10.2 ) 0.2 1.0 Goodwill impairment (124.7 ) — — Tax Act 410.9 — — Capital loss 71.4 — — Change in valuation allowances (76.9 ) 7.7 0.1 Foreign tax credits 27.3 (1.6 ) (0.1 ) China tax related to divestiture (25.8 ) — — Other (21.9 ) (2.3 ) 0.2 Effective income tax rate 213.8 % 32.7 % 37.1 % |
Schedule of Deferred Tax Assets and Liabilities | The following table presents the components of the deferred income tax assets and liabilities at June 30: (in millions) 2018 2017 Deferred income tax assets: Receivable basis difference $ 41 $ 42 Accrued liabilities 110 125 Share-based compensation 40 53 Loss and tax credit carryforwards 526 378 Deferred tax assets related to uncertain tax positions 30 51 Other 101 43 Total deferred income tax assets 848 692 Valuation allowance for deferred income tax assets (412 ) (237 ) Net deferred income tax assets $ 436 $ 455 Deferred income tax liabilities: Inventory basis differences $ (1,103 ) $ (1,578 ) Property-related (176 ) (183 ) Goodwill and other intangibles (934 ) (570 ) Total deferred income tax liabilities $ (2,213 ) $ (2,331 ) Net deferred income tax liability $ (1,777 ) $ (1,876 ) |
Schedule of Deferred Tax Assets and Liabilities after Netting by Tax Jurisdiction | Deferred income tax assets and liabilities in the preceding table, after netting by taxing jurisdiction, are in the following captions in the consolidated balance sheets at June 30: (in millions) 2018 2017 Noncurrent deferred income tax asset (1) 37 73 Noncurrent deferred income tax liability (2) (1,814 ) (1,949 ) Net deferred income tax liability $ (1,777 ) $ (1,876 ) (1) Included in other assets in the consolidated balance sheets. (2) Included in deferred income taxes and other liabilities in the consolidated balance sheets. |
Schedule of Unrecognized Tax Benefits Roll Forward | sheets. The following table presents a reconciliation of the beginning and ending amounts of unrecognized tax benefits: (in millions) 2018 2017 2016 Balance at beginning of fiscal year $ 417 $ 527 $ 542 Additions for tax positions of the current year 15 29 22 Additions for tax positions of prior years (1) 141 23 42 Reductions for tax positions of prior years (40 ) (8 ) (48 ) Settlements with tax authorities (1) (99 ) (154 ) (30 ) Expiration of the statute of limitations (1) (11 ) — (1 ) Balance at end of fiscal year $ 423 $ 417 $ 527 (1) Included in additions for tax positions of prior years is $110 million related to exposures acquired as part of the Patient Recovery Business for which we are indemnified. Settlements of $81 million related to the Patient Recovery Business as well as $11 million of statute expirations. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Assets and Liabilities Measured on Recurring Basis | The following tables present the fair values for assets and (liabilities) measured on a recurring basis at June 30: 2018 (in millions) Level 1 Level 2 Level 3 Total Assets: Cash equivalents $ 200 $ — $ — $ 200 Other investments (2) 117 — — 117 Liabilities: Contingent consideration (3) — — (1 ) (1 ) Forward contracts (4) — (76 ) — (76 ) 2017 (in millions) Level 1 Level 2 Level 3 Total Assets: Cash equivalents $ 739 $ — $ — $ 739 Available-for-sale securities (1) — 65 — 65 Other investments (2) 116 — — 116 Liabilities: Contingent consideration (3) — — (32 ) (32 ) Forward contracts (4) — (21 ) — (21 ) (1) We invest in marketable securities, which are classified as available-for-sale and are carried at fair value in the consolidated balance sheets. Observable Level 2 inputs such as quoted prices for similar securities, interest rate spreads, yield curves and credit risk are used to determine the fair value. See Note 6 for additional information regarding available-for-sale securities. (2) Level 1 other investments balance includes investments in mutual funds, which are used to offset fluctuations in deferred compensation liabilities. These mutual funds primarily invest in the equity securities of companies with large market capitalization and high quality fixed income debt securities. The fair value of these investments is determined using quoted market prices. (3) Contingent consideration represents the obligations incurred in connection with acquisitions. We do not deem the fair value of the contingent consideration obligations under any single acquisition to be significant. The estimate of fair value of the contingent consideration obligations requires subjective assumptions to be made regarding future business results, discount rates, discount periods, and probabilities assigned to various potential business result scenarios and was determined using probability assessments with respect to the likelihood of reaching various targets or of achieving certain milestones. The fair value measurement is based on significant inputs unobservable in the market and thus represents a Level 3 measurement. Changes in current expectations of progress could change the probability of achieving the targets within the measurement periods and result in an increase or decrease in the fair value of the contingent consideration obligation. (4) The fair value of interest rate swaps, foreign currency contracts and commodity contracts is determined based on the present value of expected future cash flows considering the risks involved, including non-performance risk, and using discount rates appropriate for the respective maturities. Observable Level 2 inputs are used to determine the present value of expected future cash flows. The fair value of these derivative contracts, which are subject to master netting arrangements under certain circumstances, is presented on a gross basis in the consolidated balance sheets. |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The following table presents those liabilities measured at fair value on a recurring basis using unobservable inputs (Level 3): (in millions) Contingent Consideration Obligation Balance at June 30, 2016 $ 19 Additions from acquisitions 21 Changes in fair value of contingent consideration (1) (5 ) Payment of contingent consideration (3 ) Balance at June 30, 2017 32 Additions from acquisitions 5 Changes in fair value of contingent consideration (1) (2 ) Payment of contingent consideration (35 ) Balance at June 30, 2018 $ 1 The sum of the components may not equal the total due to rounding. (1) Amount is included in amortization and other acquisition-related costs in the consolidated statements of earnings. |
Financial Instruments (Tables)
Financial Instruments (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Fair Value of Assets and Liabilities Related to Derivatives Designated as Hedging Instruments | The following table summarizes the fair value of our assets and liabilities related to derivatives designated as hedging instruments and the respective line items in which they were recorded in the consolidated balance sheets at June 30: (in millions) 2018 2017 Assets: Foreign currency contracts (1) $ 3 $ 3 Commodity contracts (1) 2 — Total assets $ 5 $ 3 Liabilities: Foreign currency contracts (3) $ 3 $ 2 Pay-floating interest rate swaps (2) 78 19 Pay-floating interest rate swaps (3) $ — $ 2 Commodity contracts (3) — 1 Total liabilities $ 81 $ 24 (1) Included in prepaid expenses and other in the consolidated balance sheets. (2) Included in deferred income taxes and other liabilities in the consolidated balance sheets. (3) Included in other accrued liabilities in the consolidated balance sheets. |
Derivative [Line Items] | |
Schedule of Gain/(Loss) Included in AOCI for Derivative Instruments | The following table summarizes the gain/(loss) included in AOCI for derivative instruments designated as cash flow hedges at June 30: (in millions) 2018 2017 Commodity contracts 2 (1 ) Foreign currency contracts (2 ) — |
Schedule of Gain/(Loss) Recognized in Earnings for Interest Rate Contracts Designated as Fair Value Hedges | The following table summarizes the gain/(loss) recognized in earnings for interest rate swaps designated as fair value hedges: (in millions) 2018 2017 2016 Pay-floating interest rate swaps (1) $ 11 $ 17 $ 23 Fixed-rate debt (1) (11 ) (17 ) (23 ) (1) Included in interest expense, net in the consolidated statements of earnings. |
Schedule of Gain/(Loss) Reclassified from AOCI into Earnings for Derivative Instruments Designated as Cash Flow Hedges | The following table summarizes the gain/(loss) reclassified from AOCI into earnings for derivative instruments designated as cash flow hedges: (in millions) 2018 2017 2016 Foreign currency contracts (1) $ 1 $ (1 ) $ 1 Foreign currency contracts (2) — (1 ) 5 Foreign currency contracts (3) (2 ) 2 (3 ) Commodity contracts (3) — (3 ) (5 ) (1) Included in revenue in the consolidated statements of earnings. (2) Included in cost of products sold in the consolidated statements of earnings. (3) Included in SG&A expenses in the consolidated statements of earnings. |
Schedule of Gain/(Loss) Recognized in Earnings for Economic (Non-designated) Derivative Instruments | The following table summarizes the gain/(loss) recognized in earnings for economic (non-designated) derivative instruments: (in millions) 2018 2017 2016 Foreign currency contracts (1) $ (5 ) $ (5 ) $ (17 ) (1) Included in other income, net in the consolidated statements of earnings. |
Schedule of Estimated Fair Value of Long-term Obligations and Other Short-term Borrowings Compared to the Respective Carrying Amount | The following table summarizes the estimated fair value of our long-term obligations and other short-term borrowings compared to the respective carrying amounts at June 30: (in millions) 2018 2017 Estimated fair value $ 8,852 $ 10,713 Carrying amount 9,013 10,395 |
Schedule of Fair Value Gain/(Loss) Derivative Instrument | The following table is a summary of the fair value gain/(loss) of our derivative instruments based upon the estimated amount that we would receive (or pay), considering counter-party credit risk, to terminate the contracts at June 30: 2018 2017 (in millions) Notional Fair Value Notional Fair Value Pay-floating interest rate swaps $ 2,313 $ (78 ) $ 1,813 $ (19 ) Foreign currency contracts 674 — 720 1 Commodity contracts 12 — 17 (1 ) |
Not Designated as Hedging Instrument | |
Derivative [Line Items] | |
Schedule of Outstanding Instruments | The following tables summarize the outstanding economic (non-designated) derivative instruments at June 30: 2018 (in millions) Notional Amount Maturity Date Foreign currency contracts $ 550 Jul 2018 - Jun 2019 2017 (in millions) Notional Amount Maturity Date Foreign currency contracts $ 558 Jul 2017 |
Fair Value Hedging | |
Derivative [Line Items] | |
Schedule of Outstanding Instruments | The following tables summarize the outstanding interest rate swaps designated as fair value hedges at June 30: 2018 (in millions) Notional Amount Maturity Date Pay-floating interest rate swaps $ 2,313 Nov 2019 - Sep 2025 2017 (in millions) Notional Amount Maturity Date Pay-floating interest rate swaps $ 1,813 Jun 2018 - Sep 2025 |
Cash Flow Hedging | |
Derivative [Line Items] | |
Schedule of Outstanding Instruments | The following tables summarize the outstanding cash flow hedges at June 30: 2018 (in millions) Notional Amount Maturity Date Foreign currency contracts $ 124 Jul 2018 - Jun 2019 Commodity contracts 12 Jul 2018 - Oct 2020 2017 (in millions) Notional Amount Maturity Date Foreign currency contracts $ 162 Jul 2017 - Jun 2018 Commodity contracts 17 Jul 2017 - Apr 2020 |
Redeemable Noncontrolling Int38
Redeemable Noncontrolling Interests (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Temporary Equity [Abstract] | |
Reconciliation of the Changes in Redeemable Noncontrolling Interests | The reconciliation of the changes in redeemable noncontrolling interests are as follows: (in millions) Redeemable Noncontrolling Interests Balance at June 30, 2016 $ 117 Net earnings attributable to redeemable noncontrolling interests 4 Net purchase of redeemable noncontrolling interests (3 ) Balance at June 30, 2017 118 Net earnings attributable to redeemable noncontrolling interest 2 Net purchase of redeemable noncontrolling interests (103 ) Adjustment of redeemable noncontrolling interests to redemption value (5 ) Balance at June 30, 2018 $ 12 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Equity [Abstract] | |
Schedule of Changes in the Balance of Accumulated Other Comprehensive Loss by Component and in Total | The following table summarizes the changes in the balance of accumulated other comprehensive income/(loss) by component and in total: (in millions) Foreign Currency Translation Adjustments and other Unrealized Gain/(Loss) on Derivatives, net of tax Accumulated Other Comprehensive Income/(Loss) Balance at June 30, 2016 $ (123 ) $ 7 $ (116 ) Other comprehensive income/(loss), net before reclassifications (25 ) 19 (6 ) Amounts reclassified to earnings — (3 ) (3 ) Total other comprehensive loss attributable to Cardinal Health, Inc., net of tax of $9 million (25 ) 16 (9 ) Balance at June 30, 2017 (148 ) 23 (125 ) Other comprehensive income/(loss), before reclassifications 58 — 58 Amounts reclassified to earnings (23 ) (2 ) (25 ) Total comprehensive income/(loss) attributable to Cardinal Health, Inc., net of tax of $1 million 35 (2 ) 33 Balance at June 30, 2018 $ (113 ) $ 21 $ (92 ) |
Earnings Per Share Attributab40
Earnings Per Share Attributable to Cardinal Health, Inc. (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Reconciliation of Common Shares Used to Compute Basic and Diluted Earnings Per Share | The following table reconciles the computation of basic and diluted earnings per share attributable to Cardinal Health, Inc.: (in millions, except per share amounts) 2018 2017 2016 Net earnings $ 259 $ 1,294 $ 1,431 Net earnings attributable to noncontrolling interest (3 ) (6 ) (4 ) Net earnings attributable to Cardinal Health, Inc. $ 256 $ 1,288 $ 1,427 Weighted-average common shares–basic 313 317 327 Effect of dilutive securities: Employee stock options, restricted share units, and performance share units 2 3 3 Weighted-average common shares–diluted 315 320 330 Basic earnings per common share attributable to Cardinal Health, Inc.: $ 0.82 $ 4.06 $ 4.36 Diluted earnings per common share attributable to Cardinal Health, Inc.: 0.81 4.03 4.32 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
Revenue by Reportable Segment | The following table presents revenue for each reportable segment and Corporate: (in millions) 2018 2017 2016 Pharmaceutical $ 121,241 $ 116,463 $ 109,131 Medical 15,581 13,524 12,430 Total segment revenue 136,822 129,987 121,561 Corporate (1) (13 ) (11 ) (15 ) Total revenue $ 136,809 $ 129,976 $ 121,546 (1) Corporate revenue consists of the elimination of inter-segment revenue and other revenue not allocated to the segments. |
Segment Profit by Reportable Segment | The following tables present segment profit by reportable segment and Corporate: (in millions) 2018 2017 2016 Pharmaceutical $ 1,992 $ 2,187 $ 2,488 Medical 662 572 457 Total segment profit 2,654 2,759 2,945 Corporate (2,528 ) (639 ) (486 ) Total operating earnings $ 126 $ 2,120 $ 2,459 |
Depreciation and Amortization and Additions to Property and Equipment by Reportable Segment | The following tables present depreciation and amortization and additions to property and equipment by reportable segment and Corporate: (in millions) 2018 2017 2016 Pharmaceutical $ 156 $ 122 $ 128 Medical 278 156 136 Corporate 598 439 377 Total depreciation and amortization $ 1,032 $ 717 $ 641 (in millions) 2018 2017 2016 Pharmaceutical $ 58 $ 50 $ 88 Medical 127 123 96 Corporate 199 214 281 Total additions to property and equipment $ 384 $ 387 $ 465 |
Assets by Reportable Segment | The following table presents total assets for each reportable segment and Corporate at June 30: (in millions) 2018 2017 2016 Pharmaceutical $ 21,421 $ 21,848 $ 20,662 Medical 16,066 10,688 10,236 Corporate 2,464 7,576 3,224 Total assets $ 39,951 $ 40,112 $ 34,122 |
Revenue and Property and Equipment, Net by Geographic Area | The following tables present revenue and property and equipment, net by geographic area: (in millions) 2018 2017 2016 United States $ 132,526 $ 125,006 $ 116,864 International 4,283 4,970 4,682 Total revenue $ 136,809 $ 129,976 $ 121,546 (in millions) 2018 2017 2016 United States $ 1,950 $ 1,623 $ 1,558 International 537 256 238 Property and equipment, net $ 2,487 $ 1,879 $ 1,796 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Total Share-based Compensation Expense by Type of Award | The following table provides total share-based compensation expense by type of award: (in millions) 2018 2017 2016 Restricted share unit expense $ 73 $ 69 $ 69 Employee stock option expense 22 19 21 Performance share unit expense (10 ) 8 21 Total share-based compensation expense $ 85 $ 96 $ 111 |
Schedule of Stock Option Transactions Under the Plans | The following table summarizes all stock option transactions under the Plans: (in millions, except per share amounts) Stock Options Weighted-Average Exercise Price per Common Share Outstanding at June 30, 2016 7 $ 54.09 Granted 1 83.09 Exercised (2 ) 37.79 Canceled and forfeited — — Outstanding at June 30, 2017 6 63.44 Granted 2 66.39 Exercised (1 ) 43.12 Canceled and forfeited — — Outstanding at June 30, 2018 7 $ 64.50 Exercisable at June 30, 2018 5 $ 59.60 |
Schedule of Additional Data Related to Stock Option Activity | The following table provides additional detail related to stock options: (in millions, except per share amounts) 2018 2017 2016 Aggregate intrinsic value of outstanding options at period end $ 13 $ 109 $ 181 Aggregate intrinsic value of exercisable options at period end 13 106 161 Aggregate intrinsic value of exercised options 14 73 63 Net proceeds/(withholding) from share-based compensation (3 ) 26 6 Excess tax benefits from share based compensation 10 34 33 Total compensation cost, net of estimated forfeitures, related to unvested stock options not yet recognized, pre-tax 17 22 22 Total fair value of shares vested during the year 19 19 20 Weighted-average grant date fair value per stock option 13.50 16.67 17.40 |
Schedule of Remaining Stock Option Plan Data | (in years) 2018 2017 2016 Weighted-average remaining contractual life of outstanding options 7 7 6 Weighted-average remaining contractual life of exercisable options 5 6 5 Weighted-average period over which stock option compensation cost is expected to be recognized 2 2 2 |
Schedule of Range of Assumptions Used to Estimate Fair Value of Stock Options | The following table provides the range of assumptions used to estimate the fair value of stock options: 2018 2017 2016 Risk-free interest rate 2.1% 1.4% - 2.0% 1.5% - 1.9% Expected volatility 25% 24% 23% Dividend yield 2.7% - 2.8% 2.2% - 2.5% 1.8% - 2.0% Expected life in years 7 7 7 |
Schedule of Transactions Related to Restricted Share Units Under the Plans | The following table summarizes all transactions related to restricted share units under the Plans: (in millions, except per share amounts) Restricted Share Units Weighted-Average Grant Date Fair Value per Share Nonvested at June 30, 2016 2 $ 71.73 Granted 1 82.34 Vested (1 ) 69.23 Canceled and forfeited — — Nonvested at June 30, 2017 2 76.72 Granted 1 65.97 Vested (1 ) 78.92 Canceled and forfeited — — Nonvested at June 30, 2018 2 $ 71.58 |
Additional Restricted Shares and Restricted Share Units Activity | The following table provides additional data related to restricted share unit activity: (in millions) 2018 2017 2016 Total compensation cost, net of estimated forfeitures, related to nonvested restricted share and share unit awards not yet recognized, pre-tax $ 78 $ 73 $ 79 Weighted-average period in years over which restricted share and share unit cost is expected to be recognized (in years) 2 2 2 Total fair value of shares vested during the year $ 65 $ 64 $ 65 |
Schedule of Transactions Related to Performance Share Units Under the Plans | The following table summarizes all transactions related to performance share units under the Plans (based on target award amounts): (in millions, except per share amounts) Performance Share Units Weighted-Average Grant Date Fair Value per Share Nonvested at June 30, 2016 0.8 $ 63.96 Granted 0.2 83.19 Vested (1) (0.4 ) 51.49 Canceled and forfeited — — Nonvested at June 30, 2017 0.6 77.83 Granted 0.2 66.43 Vested (2) (0.2 ) 71.57 Canceled and forfeited (0.2 ) — Nonvested at June 30, 2018 0.4 $ 66.13 (1) Vested at 170 percent of the target performance share units granted. (2) Vested at 133 percent of the target performance share units granted. |
Additional Data Related to Performance Share Units Activity | The following table provides additional data related to performance share unit activity: (in millions) 2018 2017 2016 Total compensation cost, net of estimated forfeitures, related to nonvested performance share units not yet recognized, pre-tax $ 1 $ 13 $ 17 Weighted-average period over which performance share unit cost is expected to be recognized (in years) 2 2 2 Total fair value of shares vested during the year $ 14 $ 19 $ 16 |
Selected Quarterly Financial 43
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Selected Quarterly Financial Data | The following is selected quarterly financial data for fiscal 2018 and 2017 . The sum of the quarters may not equal year-to-date due to rounding. (in millions, except per common share amounts) First Second Third Fourth Fiscal 2018 Revenue $ 32,641 $ 35,186 $ 33,633 $ 35,349 Gross margin (1) 1,672 1,861 1,913 1,735 Distribution, selling, general and administrative expenses 1,062 1,131 1,132 1,270 Net earnings/(loss) (2) 117 1,053 255 (1,166 ) Less: Net earnings attributable to noncontrolling interests (2 ) — — — Net earnings/(loss) attributable to Cardinal Health, Inc. 115 1,053 255 (1,166 ) Net earnings/(loss) attributable to Cardinal Health, Inc. per common share: Basic $ 0.36 $ 3.35 $ 0.81 $ (3.76 ) Diluted (3) 0.36 3.33 0.81 (3.76 ) (1) Gross margin was not impacted by LIFO benefit/(charges) in fiscal 2018. (2) During the fourth quarter of fiscal 2018, we recognized a goodwill impairment charge of $ 1.4 billion related to our Medical segment. There was no tax benefit related to this goodwill impairment charge. (3) Due to the net loss during the fourth quarter of fiscal 2018, dilutive potential common shares have not been included in the denominator of the dilutive per share computation due to their antidilutive effect. (in millions, except per common share amounts) First Second Third Fourth Fiscal 2017 Revenue $ 32,039 $ 33,150 $ 31,821 $ 32,966 Gross margin (4) 1,590 1,602 1,728 1,623 Distribution, selling, general and administrative expenses 920 910 960 983 Net earnings 310 324 382 278 Less: Net earnings attributable to noncontrolling interests (1 ) — (1 ) (4 ) Net earnings attributable to Cardinal Health, Inc. 309 324 381 274 Net earnings attributable to Cardinal Health, Inc. per common share: Basic $ 0.97 $ 1.02 $ 1.21 $ 0.87 Diluted 0.96 1.02 1.20 0.86 (4) Gross margin is impacted by LIFO benefit/(charges) of $ 9 million and $(9) million in the second and third quarter, respectively. We did not have LIFO benefits/(charges) in the fourth quarter. |
Basis of Presentation and Sum44
Basis of Presentation and Summary of Significant Accounting Policies (Narrative, Receivables) (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
SEC Schedule, 12-09, Valuation Allowances and Reserves, Amount | $ 626 | $ 494 | $ 541 | $ 455 |
Finance notes and related accrued interest, net, total | 136 | 171 | ||
Finance notes and related accrued interest, net, current | $ 26 | 53 | ||
Minimum | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Receivable financing agreement term | 1 year | |||
Maximum | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Receivable financing agreement term | 5 years | |||
SEC Schedule, 12-09, Allowance, Credit Loss [Member] | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
SEC Schedule, 12-09, Valuation Allowances and Reserves, Amount | $ 139 | 137 | 135 | 135 |
SEC Schedule, 12-09, Allowance, Loss on Finance Receivable [Member] | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
SEC Schedule, 12-09, Valuation Allowances and Reserves, Amount | $ 7 | $ 9 | $ 19 | $ 14 |
Basis of Presentation and Sum45
Basis of Presentation and Summary of Significant Accounting Policies (Revenue and Gross Trade Receivables Percentage by Major Customers) (Details) - Pharmaceutical | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
CVS Health | |||
Revenue, Major Customer [Line Items] | |||
Percent of Revenue | 25.00% | 23.00% | 25.00% |
Percent of Gross Trade Receivables | 22.00% | 20.00% | |
OptumRx [Member] | |||
Revenue, Major Customer [Line Items] | |||
Percent of Revenue | 11.00% | 11.00% | 7.00% |
Percent of Gross Trade Receivables | 4.00% | 1.00% |
Basis of Presentation and Sum46
Basis of Presentation and Summary of Significant Accounting Policies (Narrative, Major Customers) (Details) - organization | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Concentration Risk [Line Items] | |||
Largest group purchasing organizations | 2 | ||
Group Purchasing Organizations | |||
Concentration Risk [Line Items] | |||
Revenue, major customer, percentage | 22.00% | 21.00% | 17.00% |
Basis of Presentation and Sum47
Basis of Presentation and Summary of Significant Accounting Policies (Narrative, Inventories) (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 30, 2017 |
Accounting Policies [Abstract] | ||
Portion of inventories held at LIFO, percentage | 56.00% | 56.00% |
Inventories valued at LIFO amount higher than average cost value | $ 92 | $ 46 |
Reserves for excess and obsolete inventory | $ 147 | $ 76 |
Basis of Presentation and Sum48
Basis of Presentation and Summary of Significant Accounting Policies (Narrative, Property and Equipment) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation | $ 446 | $ 314 | $ 277 |
Interest rate on long-term projects (approximates weighted-average on long-term obligations) | 4.00% | ||
Building and Improvements | Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Useful life of property and equipment | 3 years | ||
Building and Improvements | Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Useful life of property and equipment | 39 years | ||
Machinery and equipment | Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Useful life of property and equipment | 3 years | ||
Machinery and equipment | Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Useful life of property and equipment | 20 years | ||
Furniture and fixtures | Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Useful life of property and equipment | 3 years | ||
Furniture and fixtures | Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Useful life of property and equipment | 7 years |
Basis of Presentation and Sum49
Basis of Presentation and Summary of Significant Accounting Policies (Components of Property and Equipment) (Details) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018USD ($)segment | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | |
Property, Plant and Equipment [Line Items] | |||
Long-term Debt, Weighted Average Interest Rate, at Point in Time | 4.00% | ||
Number of Operating Segments | segment | 2 | ||
Total property and equipment, at cost | $ 5,260 | $ 4,627 | |
Accumulated depreciation and amortization | (2,773) | (2,748) | |
Property and equipment, net | 2,487 | 1,879 | $ 1,796 |
Land, building and improvements | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment, at cost | 2,115 | 1,637 | |
Machinery and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment, at cost | 3,006 | 2,860 | |
Furniture and fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment, at cost | $ 139 | $ 130 | |
Maximum | Building and Improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 39 years | ||
Maximum | Machinery and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 20 years | ||
Maximum | Furniture and fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 7 years | ||
Minimum | Building and Improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 3 years | ||
Minimum | Machinery and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 3 years | ||
Minimum | Furniture and fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 3 years |
Basis of Presentation and Sum50
Basis of Presentation and Summary of Significant Accounting Policies (Narrative, Goodwill and Other Intangible Assets) (Details) $ in Millions | 12 Months Ended |
Jun. 30, 2018USD ($)segment | |
Goodwill and Intangible Assets [Line Items] | |
Goodwill, Impairment Loss | $ | $ 1,372 |
Discount Rate, fair value inputs | 8.50% |
Number of Operating Segments | segment | 2 |
Minimum | |
Goodwill and Intangible Assets [Line Items] | |
Discount Rate, fair value inputs | 8.50% |
Maximum | |
Goodwill and Intangible Assets [Line Items] | |
Discount Rate, fair value inputs | 13.50% |
Basis of Presentation and Sum51
Basis of Presentation and Summary of Significant Accounting Policies (Narrative, Vendor Reserves) (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 30, 2017 |
Accounting Policies [Abstract] | ||
Vendor reserves | $ 45 | $ 50 |
Basis of Presentation and Sum52
Basis of Presentation and Summary of Significant Accounting Policies (Narrative, Dividends) (Details) - $ / shares | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Accounting Policies [Abstract] | |||
Cash dividends per common share (in usd per share) | $ 1.85 | $ 1.80 | $ 1.55 |
Basis of Presentation and Sum53
Basis of Presentation and Summary of Significant Accounting Policies (Narrative, Sales Returns and Allowances) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Accounting Policies [Abstract] | |||
Accrual for estimated sales returns and allowances | $ 479 | $ 347 | |
Revenue Recognition, Sales Returns, Reserve for Sales Returns | $ 2,400 | $ 2,300 | $ 2,200 |
Basis of Presentation and Sum54
Basis of Presentation and Summary of Significant Accounting Policies (Narrative, Shipping and Handling) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
goods and services sold [Line Items] | |||
Cost of Goods and Services Sold | $ 129,628 | $ 123,432 | $ 115,003 |
Shipping and Handling [Member] | |||
goods and services sold [Line Items] | |||
Cost of Goods and Services Sold | $ 543 | $ 496 | $ 504 |
Basis of Presentation and Sum55
Basis of Presentation and Summary of Significant Accounting Policies (Narrative, Recent Financial Accounting Standards) (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
SEC Schedule, 12-09, Valuation Allowances and Reserves, Amount | $ 626 | $ 494 | $ 541 | $ 455 |
Acquisitions (Narrative) (Detai
Acquisitions (Narrative) (Details) $ in Millions | 12 Months Ended | |||
Jun. 30, 2018USD ($)product_category | Jul. 29, 2017country | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | |
Business Acquisition | ||||
Goodwill | $ 8,316 | $ 7,221 | $ 7,167 | |
Weighted Average Discount Rate, Identifiable Intangible Assets Acquired Present Value | 8.00% | |||
Patient Recovery Business [Member] | ||||
Business Acquisition | ||||
Payments to Acquire Intangible Assets | $ 6,100 | |||
Number of principal countries | country | 28 | |||
Transaction and integration costs | $ 109 | |||
Number of Product Categories Manufactured | product_category | 23 | |||
Proceeds from Issuance of Debt | $ 4,500 |
Acquisitions (Schedule of Estim
Acquisitions (Schedule of Estimated Fair Values of the Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Business Acquisition [Line Items] | |||
Goodwill | $ 8,316 | $ 7,221 | $ 7,167 |
Customer relationships | Minimum | |||
Business Acquisition [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 10 years | ||
Customer relationships | Maximum | |||
Business Acquisition [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 18 years | ||
Trade names | |||
Business Acquisition [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 15 years | ||
Developed technology | |||
Business Acquisition [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 15 years | ||
Patient Recovery Business | |||
Business Acquisition [Line Items] | |||
Total identifiable intangible assets acquired | $ 2,652 | ||
Cash and equivalents | 22 | ||
Inventories | 425 | ||
Prepaid expenses and other | 252 | ||
Property and equipment, net | 741 | ||
Other accrued liabilities | (322) | ||
Deferred income taxes and other liabilities | (982) | ||
Total identifiable net assets acquired/(liabilities assumed) | 2,788 | ||
Goodwill | 3,292 | ||
Total net assets acquired | 6,080 | ||
Patient Recovery Business | Customer relationships | |||
Business Acquisition [Line Items] | |||
Finite-lived intangible assets | 1,733 | ||
Patient Recovery Business | Trade names | |||
Business Acquisition [Line Items] | |||
Finite-lived intangible assets | 187 | ||
Patient Recovery Business | Developed technology | |||
Business Acquisition [Line Items] | |||
Finite-lived intangible assets | $ 732 |
Restructuring and Employee Se58
Restructuring and Employee Severance (Activity Related to Restructuring and Employee Severance Costs) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Restructuring Charges [Abstract] | |||
Employee-related costs | $ 34 | $ 51 | $ 15 |
Facility Exit and Other Costs | 142 | 5 | 10 |
Total restructuring and employee severance | $ 176 | $ 56 | $ 25 |
Restructuring and Employee Se59
Restructuring and Employee Severance (Liabilities Associated with Restructuring and Employee Severance Activities) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Restructuring Reserve [Roll Forward] | ||
Beginning Balance | $ 41 | $ 16 |
Additions | 150 | 44 |
Payments and other adjustments | (163) | (19) |
Ending Balance | 28 | 41 |
Employee- Related Costs | ||
Restructuring Reserve [Roll Forward] | ||
Beginning Balance | 41 | 15 |
Additions | 19 | 43 |
Payments and other adjustments | (36) | (17) |
Ending Balance | 24 | 41 |
Facility Exit and Other Costs | ||
Restructuring Reserve [Roll Forward] | ||
Beginning Balance | 0 | 1 |
Additions | 131 | 1 |
Payments and other adjustments | (127) | (2) |
Ending Balance | $ 4 | $ 0 |
Restructuring and Employee Se60
Restructuring and Employee Severance Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Restructuring Cost and Reserve [Line Items] | |||
Facility Exit and Other Costs | $ 142 | $ 5 | $ 10 |
Distributor Contract [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Facility Exit and Other Costs | $ 125 |
Divestitures and Assets Held 61
Divestitures and Assets Held for Sale (Narrative) (Details) - USD ($) $ in Millions | Aug. 01, 2018 | Jun. 30, 2018 | Jun. 30, 2018 | Sep. 30, 2017 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Initial Ownership Interest Before Sale | 98.00% | |||
China Pharmaceutical and Medical Products Distribution Business [Member] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Proceeds from Divestiture of Businesses | $ 861 | |||
Disposal Group, Including Discontinued Operation, Deferred Tax Liabilities | $ 59 | 59 | ||
Disposal Group, Not Discontinued Operation, Gain (Loss) on Disposal | 41 | |||
naviHealth [Member] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Deferred Tax Liabilities | 38 | $ 38 | ||
Provisional tax benefit related to transaction | $ 12 | |||
Subsequent Event | naviHealth [Member] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Proceeds from Divestiture of Businesses | $ 736 | |||
Initial Ownership Interest Before Sale | 98.00% | |||
Ownership interest in Partnership | 44.00% | |||
Partnership Indirect Ownership | 100.00% |
Divestitures and Assets Held 62
Divestitures and Assets Held for Sale (Schedule of Assets and Liabilities Classified as Held for Sale (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 30, 2017 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Total assets held for sale | $ 756 | $ 0 |
Total liabilities related to assets held for sale | 213 | $ 0 |
naviHealth [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Trade Receivables, net | 74 | |
Goodwill and other intangibles, net | 642 | |
Other Assets | 40 | |
Total assets held for sale | 756 | |
Deferred revenue | 35 | |
Deferred income taxes | 38 | |
Other liabilities | 140 | |
Total liabilities related to assets held for sale | $ 213 |
Goodwill and Other Intangible63
Goodwill and Other Intangible Assets (Schedule of Goodwill by Reportable Segment) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | |
Goodwill [Roll Forward] | |||
Beginning balance | $ 7,221 | $ 7,167 | |
Goodwill acquired, net of purchase price adjustments | 3,343 | 64 | |
Foreign currency translation adjustments and other | (34) | 10 | |
Goodwill Divested with Sale of business | (401) | ||
Goodwill reclassified to assets held for sale | (509) | ||
Goodwill, Impairment Loss | (1,372) | ||
Ending balance | $ 8,316 | 8,316 | 7,221 |
Pharmaceutical | |||
Goodwill [Roll Forward] | |||
Beginning balance | 2,939 | 2,919 | |
Goodwill acquired, net of purchase price adjustments | 1 | 29 | |
Foreign currency translation adjustments and other | (28) | 9 | |
Goodwill Divested with Sale of business | (347) | ||
Goodwill reclassified to assets held for sale | 0 | ||
Goodwill, Impairment Loss | 0 | ||
Ending balance | 2,621 | 2,621 | 2,939 |
Accumulated goodwill impairment loss | (829) | (829) | (829) |
Medical | |||
Goodwill [Roll Forward] | |||
Beginning balance | 4,282 | 4,248 | |
Goodwill acquired, net of purchase price adjustments | 3,342 | 35 | |
Foreign currency translation adjustments and other | (6) | 1 | |
Goodwill Divested with Sale of business | (54) | ||
Goodwill reclassified to assets held for sale | (509) | ||
Goodwill, Impairment Loss | (1,372) | (1,372) | |
Ending balance | 5,695 | 5,695 | 4,282 |
Accumulated goodwill impairment loss | $ (1,372) | $ (1,372) | $ 0 |
Goodwill and Other Intangible64
Goodwill and Other Intangible Assets (Schedule of Intangible Assets) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Indefinite-lived Intangible Assets [Line Items] | |||
Net Intangible | $ 62 | $ 61 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of Intangible Assets | 574 | 395 | $ 355 |
Gross Intangible | 5,742 | 3,391 | |
Accumulated Amortization | 1,891 | 1,466 | |
Net Intangible | $ 3,851 | 1,925 | |
Weighted- Average Remaining Amortization Period (Years) | 14 years | ||
Gross Intangible, Total other intangible assets | $ 5,804 | 3,452 | |
Net Intangible, Total other intangible assets | 3,913 | 1,986 | |
IPR&D, trademarks and other | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Net Intangible | 62 | ||
IPR&D, trademarks and other | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Net Intangible | 61 | ||
Customer relationships | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Intangible | 3,513 | 1,966 | |
Accumulated Amortization | 1,191 | 967 | |
Net Intangible | $ 2,322 | 999 | |
Weighted- Average Remaining Amortization Period (Years) | 15 years | ||
Trademarks, trade names and patents | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Intangible | $ 667 | 509 | |
Accumulated Amortization | 246 | 195 | |
Net Intangible | $ 421 | 314 | |
Weighted- Average Remaining Amortization Period (Years) | 15 years | ||
Developed technology and other | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Intangible | $ 1,562 | 916 | |
Accumulated Amortization | 454 | 304 | |
Net Intangible | $ 1,108 | $ 612 | |
Weighted- Average Remaining Amortization Period (Years) | 12 years |
Goodwill and Other Intangible65
Goodwill and Other Intangible Assets (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Goodwill [Line Items] | |||
Discount Rate, fair value inputs | 8.50% | ||
Goodwill, Impairment Loss | $ (1,372) | ||
Goodwill | 8,316 | $ 7,221 | $ 7,167 |
Amortization of Intangible Assets | 574 | $ 395 | $ 355 |
Estimated annual amortization of intangible assets - 2019 | 529 | ||
Estimated annual amortization of intangible assets - 2020 | 501 | ||
Estimated annual amortization of intangible assets - 2021 | 430 | ||
Estimated annual amortization of intangible assets - 2022 | 398 | ||
Estimated annual amortization of intangible assets - 2023 | 348 | ||
Medical Reporting Unit [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 4,300 | ||
China Pharmaceutical and Medical Products Distribution Business [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Impairment Loss | (401) | ||
Other intangible assets divested with sale of business | 62 | ||
naviHealth [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Impairment Loss | (509) | ||
Other intangible assets divested with sale of business | $ 133 |
Available-for-Sale Securities66
Available-for-Sale Securities (Schedule of Available-for-Sale Securities) (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 30, 2017 |
Debt Securities, Available-for-sale [Line Items] | ||
Total available-for-sale securities | $ 0 | $ 65 |
Treasury bills | ||
Debt Securities, Available-for-sale [Line Items] | ||
Total current available-for-sale securities | 0 | 25 |
International bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Total current available-for-sale securities | 0 | 3 |
Corporate bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Total current available-for-sale securities | 0 | 30 |
U.S. agency bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Total current available-for-sale securities | 0 | 3 |
Asset-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Total current available-for-sale securities | 0 | 3 |
International equity securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Total current available-for-sale securities | $ 0 | 1 |
Fair Value, Measurements, Recurring | ||
Debt Securities, Available-for-sale [Line Items] | ||
Total available-for-sale securities | 65 | |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Total available-for-sale securities | $ 65 |
Long-Term Obligations and Oth67
Long-Term Obligations and Other Short-Term Borrowings Summary of Debt (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 30, 2017 |
Debt Instrument [Line Items] | ||
Other obligations | $ 11 | $ 388 |
Total | 9,013 | 10,395 |
Less: current portion of long-term obligations and other short-term borrowings | 1,001 | 1,327 |
Long-term obligations, less current portion | 8,012 | 9,068 |
1.7% Notes due 2018 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 0 | 400 |
1.95% Notes due 2018 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 0 | 547 |
1.948% Notes due 2019 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 998 | 996 |
2.4% Notes due 2019 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 448 | 453 |
4.625% Notes due 2020 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 514 | 519 |
2.616% Notes due fiscal 2022 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 1,143 | 1,142 |
3.2% Notes due 2022 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 243 | 248 |
Floating Rate Notes due fiscal 2022 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 348 | 347 |
3.2% Notes due 2023 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 525 | 544 |
3.079% Notes due fiscal 2024 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 742 | 744 |
3.5% Notes due fiscal 2025 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 390 | 396 |
3.75% Notes due 2025 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 460 | 481 |
3.41% Notes due fiscal 2027 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 1,340 | 1,340 |
4.6% Notes due 2043 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 346 | 346 |
4.5% Notes due 2044 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 342 | 341 |
4.9% Notes due 2045 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 445 | 445 |
4.368% Notes due fiscal 2047 | ||
Debt Instrument [Line Items] | ||
Notes Payable | 594 | 594 |
7.0% Debentures due 2026 | ||
Debt Instrument [Line Items] | ||
Notes Payable | $ 124 | $ 124 |
Long-Term Obligations and Oth68
Long-Term Obligations and Other Short-Term Borrowings Narrative (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Jul. 31, 2017 | Jun. 30, 2017 | Jun. 30, 2018 | Aug. 31, 2017 | |
Line of Credit Facility [Line Items] | ||||
Carrying Amount of Debt Associated with Divestiture | $ 378 | |||
Maturities of existing long-term obligations and other short-term borrowings - 2018 | 1,001 | |||
Maturities of existing long-term obligations and other short-term borrowings-2019 | 452 | |||
Maturities of existing long-term obligations and other short-term borrowings-2020 | 516 | |||
Maturities of existing long-term obligations and other short-term borrowings-2021 | 1,735 | |||
Maturities of existing long-term obligations and other short-term borrowings-2022 | 526 | |||
Maturities of existing long-term obligations and other short-term borrowings-Thereafter | 4,783 | |||
Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Line of Credit Facility, Maximum Borrowing Capacity | 2,000 | $ 1,750 | ||
Commercial paper | ||||
Line of Credit Facility [Line Items] | ||||
Line of Credit Facility, Maximum Amount Outstanding During Period | 1,700 | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 2,000 | |||
1.7% Notes due 2018 | ||||
Line of Credit Facility [Line Items] | ||||
Proceeds from (Repayments of) Notes Payable | $ 400 | |||
Patient Recovery Business [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Proceeds from Notes Payable | $ 5,200 |
Long-Term Obligations and Oth69
Long-Term Obligations and Other Short-Term Borrowings Long-Term Debt (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Jun. 30, 2018 | Jul. 31, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Debt Instrument [Line Items] | ||||
Accounts payable | $ 19,677 | $ 19,677 | $ 17,906 | |
1.7% Notes due 2018 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 1.70% | |||
Proceeds from (Repayments of) Notes Payable | $ (400) | |||
Offer as percentage of principal amount | 101.00% | |||
1.948% Notes due 2019 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 1.948% | |||
2.616% Notes due fiscal 2022 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 2.616% | |||
3.079% Notes due fiscal 2024 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 3.079% | |||
3.41% Notes due fiscal 2027 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 3.41% | |||
4.368% Notes due fiscal 2047 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 4.368% | |||
1.95% Notes due 2018 | ||||
Debt Instrument [Line Items] | ||||
Proceeds from (Repayments of) Notes Payable | $ (550) | |||
7.0% Debentures due 2026 | Allegiance Corporation | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 7.00% | 7.00% | ||
Medtronic | ||||
Debt Instrument [Line Items] | ||||
Proceeds from Notes Payable, Net | $ 5,200 |
Long-Term Obligations and Oth70
Long-Term Obligations and Other Short-Term Borrowings Other Financing Arrangements (Details) | 12 Months Ended | ||
Jun. 30, 2018USD ($) | Aug. 31, 2017USD ($) | Jun. 30, 2017USD ($) | |
Debt Instrument [Line Items] | |||
Other obligations | $ 11,000,000 | $ 388,000,000 | |
Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 2,000,000,000 | $ 1,750,000,000 | |
Revolving Credit Facility | Committed Receivables Sales Facility Program | |||
Debt Instrument [Line Items] | |||
Leverage ratio | 4.25 | ||
Letter of Credit | |||
Debt Instrument [Line Items] | |||
Line of credit | $ 24,000,000 | 20,000,000 | |
Letter of Credit | Committed Receivables Sales Facility Program | |||
Debt Instrument [Line Items] | |||
Line of credit | 34,000,000 | 46,000,000 | |
Short Term Credit Facilities | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | 8,000,000 | $ 690,000,000 | |
Short Term Credit Facilities | Committed Receivables Sales Facility Program | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | 1,000,000,000 | ||
Commercial Paper | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | 2,000,000,000 | ||
Average amount outstanding | $ 277,000,000 |
Income Taxes (Schedule of Incom
Income Taxes (Schedule of Income before Income Tax, Domestic and Foreign) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | |||
U.S. operations | $ 391 | $ 1,772 | $ 2,050 |
Non-U.S. operations | (619) | 152 | 226 |
Earnings/(loss) before income taxes | $ (228) | $ 1,924 | $ 2,276 |
Income Taxes (Schedule of Compo
Income Taxes (Schedule of Components of Income Tax Expense (Benefit), Current and Deferred) (Details) - USD ($) $ in Millions | Jun. 28, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 |
Current: | ||||
Federal | $ 341 | $ 273 | $ 633 | |
State and local | 41 | 10 | 52 | |
Non-U.S. | 143 | 56 | 73 | |
Total current | 525 | 339 | 758 | |
Deferred: | ||||
Federal | $ (163) | (1,003) | 258 | 96 |
State and local | 16 | 37 | 12 | |
Non-U.S. | (25) | (4) | (21) | |
Total deferred | (1,012) | 291 | 87 | |
Provision for/(benefit from) income taxes | $ (487) | $ 630 | $ 845 |
Income Taxes (Schedule of Effec
Income Taxes (Schedule of Effective Income Tax Rate Reconciliation) (Details) | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | |||
Provision at Federal statutory rate | 28.10% | 35.00% | 35.00% |
State and local income taxes, net of federal benefit | (16.00%) | 1.00% | 1.50% |
Foreign tax rate differential | (48.40%) | (7.30%) | (0.60%) |
Nondeductible/nontaxable items | (10.20%) | 0.20% | 1.00% |
Goodwill impairment | (124.70%) | (0.00%) | (0.00%) |
Tax Act | 410.90% | (0.00%) | (0.00%) |
Capital loss | 71.40% | (0.00%) | (0.00%) |
Change in valuation allowances | (76.90%) | 7.70% | 0.10% |
Foreign tax credits | 27.30% | (1.60%) | (0.10%) |
China tax related to divestiture | (25.80%) | (0.00%) | (0.00%) |
Other | (21.90%) | (2.30%) | 0.20% |
Effective income tax rate | 213.80% | 32.70% | 37.10% |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Millions | Jun. 28, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 |
Income Taxes | |||||
Effective Income Tax Rate Reconciliation, Percent | 213.80% | 32.70% | 37.10% | ||
Provision at Federal statutory rate | 28.10% | 35.00% | 35.00% | ||
Provisional net tax benefit related to Tax Act | $ 977 | ||||
Undistributed earnings from non-U.S. subsidiaries | 110 | ||||
Provisional Tax Expense on Repatriated Undistributed Earnings of Foreign Subsidiaries | 41 | ||||
Federal | $ 163 | 1,003 | $ (258) | $ (96) | |
Deferred Tax Assets, Valuation Allowance | $ 72 | ||||
Deferred tax assets on tax credit carryforwards | 526 | 378 | |||
Valuation allowance on operating loss carryforwards | 379 | ||||
Unrecognized tax benefits that would impact effective tax rate | 262 | 268 | 355 | ||
Unrecognized Tax Benefits, Increase Resulting from Prior Period Tax Positions | 141 | 23 | 42 | ||
Unrecognized tax benefits | 423 | 417 | 527 | $ 542 | |
Unrecognized Tax Benefits, Decrease Resulting from Settlements with Taxing Authorities | 99 | 154 | 30 | ||
Unrecognized Tax Benefits, Reduction Resulting from Lapse of Applicable Statute of Limitations | 11 | 0 | 1 | ||
Unrecognized tax benefits, interest and penalties accrued | 110 | 99 | 145 | ||
Unrecognized tax benefits, interest and penalties | 8 | 12 | $ 9 | ||
Amount CareFusion is liable under tax matters agreement in the event amount must be paid to the taxing authority | 151 | $ 142 | |||
Minimum | |||||
Income Taxes | |||||
Estimated range of decrease in unrecognized tax benefits within the next 12 months | 0 | ||||
Maximum | |||||
Income Taxes | |||||
Estimated range of decrease in unrecognized tax benefits within the next 12 months | 35 | ||||
Federal | |||||
Income Taxes | |||||
Tax credit carryforwards | 794 | ||||
State and Local | |||||
Income Taxes | |||||
Tax credit carryforwards | 2,026 | ||||
Foreign | |||||
Income Taxes | |||||
Tax credit carryforwards | 1,149 | ||||
Patient Recovery Business [Member] | |||||
Income Taxes | |||||
Unrecognized Tax Benefits, Increase Resulting from Prior Period Tax Positions | 110 | ||||
Unrecognized Tax Benefits, Decrease Resulting from Settlements with Taxing Authorities | 81 | ||||
Unrecognized Tax Benefits, Reduction Resulting from Lapse of Applicable Statute of Limitations | 11 | ||||
Business Combination, Indemnification Assets, Amount as of Acquisition Date | $ 21 |
Income Taxes (Schedule of Defer
Income Taxes (Schedule of Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | |||
Effective Income Tax Rate Reconciliation, Percent | 213.80% | 32.70% | 37.10% |
Deferred income tax assets: | |||
Receivable basis difference | $ 41 | $ 42 | |
Accrued liabilities | 110 | 125 | |
Share-based compensation | 40 | 53 | |
Loss and tax credit carryforwards | 526 | 378 | |
Deferred tax assets related to uncertain tax positions | 30 | 51 | |
Other | 101 | 43 | |
Total deferred income tax assets | 848 | 692 | |
Valuation allowance for deferred income tax assets | (412) | (237) | |
Net deferred income tax assets | 436 | 455 | |
Deferred income tax liabilities: | |||
Inventory basis differences | (1,103) | (1,578) | |
Property-related | (176) | (183) | |
Goodwill and other intangibles | (934) | (570) | |
Total deferred income tax liabilities | (2,213) | (2,331) | |
Net deferred income tax liability | $ (1,777) | $ (1,876) |
Income Taxes (Schedule of Def76
Income Taxes (Schedule of Deferred Tax Assets and Liabilities After Netting by Tax Jurisdiction) (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 30, 2017 |
Income Tax Disclosure [Abstract] | ||
Noncurrent deferred income tax asset | $ 37 | $ 73 |
Noncurrent deferred income tax liability | (1,814) | (1,949) |
Net deferred income tax liability | $ (1,777) | $ (1,876) |
Income Taxes (Schedule of Unrec
Income Taxes (Schedule of Unrecognized Tax Benefits Roll Forward) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Balance at beginning of fiscal year | $ 417 | $ 527 | $ 542 |
Additions for tax positions of the current year | 15 | 29 | 22 |
Additions for tax positions of prior years (1) | 141 | 23 | 42 |
Reductions for tax positions of prior years | (40) | (8) | (48) |
Settlements with tax authorities (1) | (99) | (154) | (30) |
Expiration of the statute of limitations (1) | (11) | 0 | (1) |
Balance at end of fiscal year | 423 | $ 417 | $ 527 |
Patient Recovery Business [Member] | |||
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Additions for tax positions of prior years (1) | 110 | ||
Settlements with tax authorities (1) | (81) | ||
Expiration of the statute of limitations (1) | $ (11) |
Commitments, Contingent Liabi78
Commitments, Contingent Liabilities and Litigation (Details) $ in Millions | Aug. 20, 2018plaintiffstateslawsuit | Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | ||||
Future minimum rental payments for operating leases - 2019 | $ 113 | |||
Future minimum rental payments for operating leases - 2020 | 97 | |||
Future minimum rental payments for operating leases - 2021 | 77 | |||
Future minimum rental payments for operating leases - 2022 | 58 | |||
Future minimum rental payments for operating leases - 2023 | 41 | |||
Future minimum rental payments for operating leases - thereafter | 103 | |||
Rent expense, operating leases | 172 | $ 159 | $ 126 | |
Opioid Lawsuits | Subsequent Event | ||||
Loss Contingencies [Line Items] | ||||
Number of lawsuits filed | lawsuit | 1,000 | |||
Number of counties | states | 48 | |||
Loss Contingency State Attorneys Investigating Opioids | lawsuit | 39 | |||
Cordis | ||||
Loss Contingencies [Line Items] | ||||
Loss Contingency Accrual, Net of Insurance Recoveries | 259 | |||
Alameda County [Member] | Product Liability Lawsuits | Subsequent Event | ||||
Loss Contingencies [Line Items] | ||||
Number of lawsuits filed | lawsuit | 174 | |||
Number of plaintiffs | plaintiff | 1,918 | |||
Other Jurisdictions [Member] | Product Liability Lawsuits | Subsequent Event | ||||
Loss Contingencies [Line Items] | ||||
Number of lawsuits filed | plaintiff | 20 | |||
Number of plaintiffs | plaintiff | 21 | |||
Class Action Lawsuits [Member] | Opioid Lawsuits | Subsequent Event | ||||
Loss Contingencies [Line Items] | ||||
Number of lawsuits filed | lawsuit | 32 | |||
CVS Health | ||||
Loss Contingencies [Line Items] | ||||
Maximum quarterly payment | $ 45.6 |
Fair Value Measurements (Fair V
Fair Value Measurements (Fair Value of Assets and Liabilities Measured on a Recurring Basis) (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 30, 2017 |
Assets: | ||
Total available-for-sale securities | $ 0 | $ 65 |
Fair Value, Measurements, Recurring | ||
Assets: | ||
Cash equivalents | 200 | 739 |
Total available-for-sale securities | 65 | |
Other investments | 117 | 116 |
Liabilities: | ||
Contingent Consideration | (1) | (32) |
Forward contracts | (76) | (21) |
Fair Value, Measurements, Recurring | Level 1 | ||
Assets: | ||
Cash equivalents | 200 | 739 |
Total available-for-sale securities | 0 | |
Other investments | 117 | 116 |
Liabilities: | ||
Contingent Consideration | 0 | 0 |
Forward contracts | 0 | 0 |
Fair Value, Measurements, Recurring | Level 2 | ||
Assets: | ||
Cash equivalents | 0 | 0 |
Total available-for-sale securities | 65 | |
Other investments | 0 | 0 |
Liabilities: | ||
Contingent Consideration | 0 | 0 |
Forward contracts | (76) | (21) |
Fair Value, Measurements, Recurring | Level 3 | ||
Assets: | ||
Cash equivalents | 0 | 0 |
Total available-for-sale securities | 0 | |
Other investments | 0 | 0 |
Liabilities: | ||
Contingent Consideration | (1) | (32) |
Forward contracts | $ 0 | $ 0 |
Fair Value Measurements (Reconc
Fair Value Measurements (Reconciliation of Liabilities Measured at Fair Value on a Recurring Basis Using Unobservable Inputs (Level 3)) (Details) - Fair Value, Measurements, Recurring - Contingent Consideration Obligation - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance at beginning of period | $ 32 | $ 19 |
Additions from acquisitions | 5 | 21 |
Changes in fair value of contingent consideration | (2) | (5) |
Payment of contingent consideration | 35 | 3 |
Balance at end of period | $ 1 | $ 32 |
Financial Instruments (Schedule
Financial Instruments (Schedule of the Fair Value of Assets and Liabilities Related to Derivatives Designated as Hedging Instruments) (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 30, 2017 |
Derivatives, Fair Value [Line Items] | ||
Total assets | $ 5 | $ 3 |
Total liabilities | 81 | 24 |
Designated as Hedging Instrument | Cash Flow Hedging | Foreign Currency Contracts | Prepaid Expenses and Other | ||
Derivatives, Fair Value [Line Items] | ||
Total assets | 3 | 3 |
Designated as Hedging Instrument | Cash Flow Hedging | Foreign Currency Contracts | Other Accrued Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Total liabilities | 3 | 2 |
Designated as Hedging Instrument | Cash Flow Hedging | Commodity Contracts | Other Accrued Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Total liabilities | 0 | 1 |
Designated as Hedging Instrument | Cash Flow Hedging | Commodity Contracts | Deferred Income Taxes and Other Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Total liabilities | 2 | 0 |
Designated as Hedging Instrument | Fair Value Hedging | Interest Rate Swaps | Deferred Income Taxes and Other Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Total liabilities | 78 | 19 |
Designated as Hedging Instrument | Fair Value Hedging | Interest Rate Swaps | Other Current Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Total liabilities | $ 0 | $ 2 |
Financial Instruments (Narrativ
Financial Instruments (Narrative) (Details) - Interest Rate Swaps - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 30, 2017 |
Fair Value Hedging | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 2,313 | $ 1,813 |
Designated as Hedging Instrument | Fair Value Hedging | ||
Derivative [Line Items] | ||
Derivative, notional amount | 1,050 | 700 |
Derivatives, terminated notional amounts | 600 | |
Derivatives, matured notional amounts | $ 550 | 250 |
Designated as Hedging Instrument | Cash Flow Hedging | ||
Derivative [Line Items] | ||
Derivative, notional amount | 700 | |
Derivatives, terminated notional amounts | $ 1,000 |
Financial Instruments (Schedu83
Financial Instruments (Schedule of Outstanding Instruments, Fair Value Hedges) (Details) - Fair Value Hedging - Interest Rate Swaps - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Derivative [Line Items] | ||
Notional Amount | $ 2,313 | $ 1,813 |
Minimum | ||
Derivative [Line Items] | ||
Maturity Date | Nov. 15, 2019 | Jun. 15, 2018 |
Maximum | ||
Derivative [Line Items] | ||
Maturity Date | Sep. 15, 2025 | Sep. 15, 2025 |
Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Notional Amount | $ 1,050 | $ 700 |
Financial Instruments (Schedu84
Financial Instruments (Schedule of Gain/(Loss) Recognized in Earnings for Interest Rate Contracts Designated as Fair Value Hedges) (Details) - Fair Value Hedging - Interest Expense, Net - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Interest Rate Swaps | |||
Derivative [Line Items] | |||
Gain/(loss) on derivative | $ 11 | $ 17 | $ 23 |
Fixed-Rate Debt | |||
Derivative [Line Items] | |||
Gain/(loss) on derivative | $ (11) | $ (17) | $ (23) |
Financial Instruments (Schedu85
Financial Instruments (Schedule of Outstanding Instruments, Cash Flow Hedges) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Fair Value Hedging | Interest Rate Swaps | ||
Derivative [Line Items] | ||
Notional Amount | $ 2,313 | $ 1,813 |
Fair Value Hedging | Interest Rate Swaps | Minimum | ||
Derivative [Line Items] | ||
Maturity Date | Nov. 15, 2019 | Jun. 15, 2018 |
Fair Value Hedging | Interest Rate Swaps | Maximum | ||
Derivative [Line Items] | ||
Maturity Date | Sep. 15, 2025 | Sep. 15, 2025 |
Cash Flow Hedging | Foreign Currency Contracts | ||
Derivative [Line Items] | ||
Notional Amount | $ 124 | $ 162 |
Cash Flow Hedging | Foreign Currency Contracts | Minimum | ||
Derivative [Line Items] | ||
Maturity Date | Jul. 15, 2018 | Jul. 15, 2017 |
Cash Flow Hedging | Foreign Currency Contracts | Maximum | ||
Derivative [Line Items] | ||
Maturity Date | Jun. 15, 2019 | Jun. 30, 2018 |
Cash Flow Hedging | Commodity Contracts | ||
Derivative [Line Items] | ||
Notional Amount | $ 12 | $ 17 |
Cash Flow Hedging | Commodity Contracts | Minimum | ||
Derivative [Line Items] | ||
Maturity Date | Jul. 15, 2018 | Jul. 7, 2017 |
Cash Flow Hedging | Commodity Contracts | Maximum | ||
Derivative [Line Items] | ||
Maturity Date | Oct. 15, 2020 | Apr. 7, 2020 |
Designated as Hedging Instrument | Fair Value Hedging | Interest Rate Swaps | ||
Derivative [Line Items] | ||
Notional Amount | $ 1,050 | $ 700 |
Derivatives, Hedge Discontinuances, Termination of Hedging Instrument, Amount | 600 | |
Designated as Hedging Instrument | Cash Flow Hedging | Interest Rate Swaps | ||
Derivative [Line Items] | ||
Notional Amount | 700 | |
Derivatives, Hedge Discontinuances, Termination of Hedging Instrument, Amount | $ 1,000 |
Financial Instruments (Schedu86
Financial Instruments (Schedule of Gain/(Loss) Included in AOCI for Derivative Instruments Designated as Cash Flow Hedges) (Details) - Cash Flow Hedging - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Commodity Contracts | ||
Derivative [Line Items] | ||
Gain/(loss) included in AOCI for derivative instruments designated as cash flow hedges | $ 2 | $ (1) |
Foreign Currency Contracts | ||
Derivative [Line Items] | ||
Gain/(loss) included in AOCI for derivative instruments designated as cash flow hedges | $ (2) | $ 0 |
Financial Instruments (Schedu87
Financial Instruments (Schedule of Gain/(Loss) Reclassified from AOCI into Earnings for Derivative Instruments Designated as Cash Flow Hedges) (Details) - Cash Flow Hedging - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Foreign Currency Contracts | Revenue | |||
Derivative [Line Items] | |||
Gain/(loss) reclassified from AOCI into earnings for derivative instruments designated as cash flow hedges | $ 1 | $ (1) | $ 1 |
Foreign Currency Contracts | Cost of Products Sold | |||
Derivative [Line Items] | |||
Gain/(loss) reclassified from AOCI into earnings for derivative instruments designated as cash flow hedges | 0 | (1) | 5 |
Foreign Currency Contracts | SG&A Expenses | |||
Derivative [Line Items] | |||
Gain/(loss) reclassified from AOCI into earnings for derivative instruments designated as cash flow hedges | (2) | 2 | (3) |
Commodity Contracts | SG&A Expenses | |||
Derivative [Line Items] | |||
Gain/(loss) reclassified from AOCI into earnings for derivative instruments designated as cash flow hedges | $ 0 | $ (3) | $ (5) |
Financial Instruments (Schedu88
Financial Instruments (Schedule of Outstanding Instruments, Economic Hedges) (Details) - Foreign Currency Contracts - Not Designated as Hedging Instrument - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Derivative [Line Items] | ||
Notional Amount | $ 550 | $ 558 |
Minimum | ||
Derivative [Line Items] | ||
Maturity Date | Jul. 15, 2018 | Jul. 28, 2017 |
Maximum | ||
Derivative [Line Items] | ||
Maturity Date | Jun. 15, 2019 |
Financial Instruments (Schedu89
Financial Instruments (Schedule of Gain/(Loss) Recognized in Earnings for Derivatives Not Designated as Hedging Instrument) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Not Designated as Hedging Instrument | Foreign Currency Contracts | Other Income, Net | |||
Derivative [Line Items] | |||
Gain/(loss) recognized in earnings for economic (non-designated) derivative instruments | $ (5) | $ (5) | $ (17) |
Financial Instruments (Summary
Financial Instruments (Summary of Estimated Fair Value of Long-term Obligations and Other Short-term Borrowings) (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 30, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Carrying amount | $ 9,013 | $ 10,395 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Estimated fair value | $ 8,852 | 10,713 |
Interest Rate Swaps | Designated as Hedging Instrument | Fair Value Hedging | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives, Hedge Discontinuances, Termination of Hedging Instrument, Amount | $ 600 |
Financial Instruments (Schedu91
Financial Instruments (Schedule of Fair Value Gain Loss Derivative Instrument) (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 30, 2017 |
Fair Value Hedging | Interest Rate Swaps | ||
Derivative [Line Items] | ||
Notional Amount | $ 2,313 | $ 1,813 |
Fair Value Gain/(Loss) | (78) | (19) |
Cash Flow Hedging | Foreign Currency Contracts | ||
Derivative [Line Items] | ||
Notional Amount | 674 | 720 |
Fair Value Gain/(Loss) | 0 | 1 |
Cash Flow Hedging | Commodity Contracts | ||
Derivative [Line Items] | ||
Notional Amount | 12 | 17 |
Fair Value Gain/(Loss) | $ 0 | $ (1) |
Redeemable Noncontrolling Int92
Redeemable Noncontrolling Interests (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | 34 Months Ended | |||
Sep. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2018 | Aug. 26, 2015 | |
Redeemable Noncontrolling Interest [Line Items] | ||||||
Ownership interest (as a percent) | 98.00% | |||||
Noncontrolling interest decrease from redemptions or purchase of interests percent | 16.00% | |||||
Redeemable Noncontrolling Interest, Equity, Other, Redemption Value | $ 19 | $ 1 | $ (7) | $ 103 | ||
Redeemable Noncontrolling Interest, Equity, Redemption Value | 109 | $ 109 | ||||
naviHealth [Member] | ||||||
Redeemable Noncontrolling Interest [Line Items] | ||||||
Ownership interest (as a percent) | 82.00% | 82.00% | 71.00% | |||
Fair value of redeemable noncontrolling interests | $ 119 | |||||
Redeemable Noncontrolling Interest, Equity, Other, Redemption Value | $ 103 | $ 3 |
Redeemable Noncontrolling Int93
Redeemable Noncontrolling Interests (Changes in Redeemable Noncontrolling Interests) (Details) - USD ($) $ in Millions | 12 Months Ended | 34 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2018 | |
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||
Balance at beginning of period | $ 118 | |||
Net purchase of redeemable noncontrolling interests | (19) | $ (1) | $ 7 | $ (103) |
Balance at end of period | 12 | 118 | 12 | |
naviHealth [Member] | ||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||
Balance at beginning of period | 118 | 117 | ||
Net earnings attributable to redeemable noncontrolling interest | 2 | 4 | ||
Net purchase of redeemable noncontrolling interests | (103) | (3) | ||
Noncontrolling Interest, Change in Redemption Value | (5) | |||
Balance at end of period | $ 12 | $ 118 | $ 117 | $ 12 |
Shareholders' Equity (Narrative
Shareholders' Equity (Narrative) (Details) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | 36 Months Ended | ||
Mar. 21, 2018USD ($)$ / sharesshares | Jun. 30, 2018USD ($)$ / sharesshares | Jun. 30, 2017USD ($)$ / sharesshares | Jun. 30, 2016USD ($)$ / sharesshares | Jun. 30, 2018USD ($)shares | |
Class of Stock [Line Items] | |||||
Common shares, authorized | shares | 755,000,000 | 755,000,000 | 755,000,000 | ||
Preferred shares, authorized | shares | 500,000 | 500,000 | 500,000 | ||
Treasury shares acquired | $ | $ (550) | $ (600) | $ (651) | ||
Payments for Repurchase of Common Stock | $ | 550 | 600 | 651 | ||
Retained earnings decrease | $ | (4,645) | (4,967) | $ (4,645) | ||
Treasury Shares | |||||
Class of Stock [Line Items] | |||||
Treasury shares acquired | $ | $ (550) | $ (600) | $ (651) | $ (1,800) | |
Treasury Stock, Shares, Acquired | shares | (8,400,000) | (8,100,000) | (8,200,000) | ||
Treasury shares acquired, average price per share (in usd per share) | $ / shares | $ 65.30 | $ 74.08 | $ 78.98 | ||
Retirement of Treasury Shares (in shares) | shares | (37,000,000) | ||||
Common Class A | |||||
Class of Stock [Line Items] | |||||
Common shares, authorized | shares | 750,000,000 | 750,000,000 | 750,000,000 | ||
Common Stock, Voting Rights, Votes | 1 | ||||
Common Class B | |||||
Class of Stock [Line Items] | |||||
Common shares, authorized | shares | 5,000,000 | 5,000,000 | 5,000,000 | ||
Common Stock, Voting Rights, Votes | 0.2 | ||||
Retirement of Treasury Shares [Member] | |||||
Class of Stock [Line Items] | |||||
Retirement of Treasury Shares (in shares) | shares | 37,000,000 | ||||
Decrease in Common Shares in Treasury | $ | $ 2,500 | ||||
Decrease in Common Shares, Value | $ | 302 | ||||
Retained earnings decrease | $ | $ 2,200 | ||||
Accelerated share repurchase plan | Treasury Shares | |||||
Class of Stock [Line Items] | |||||
Treasury Stock, Shares, Acquired | shares | (4,300,000) | ||||
Payments for Repurchase of Common Stock | $ | $ 300 | ||||
Treasury shares acquired, average price per share (in usd per share) | $ / shares | $ 69.26 |
Shareholders' Equity (Changes i
Shareholders' Equity (Changes in the Accumulated Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance at beginning of period | $ 6,828 | $ 6,571 | $ 6,256 |
Amounts reclassified to earnings | (23) | 0 | 0 |
Total other comprehensive income/(loss), net of tax | 33 | (9) | (93) |
Total comprehensive income/(loss) attributable to Cardinal Health, Inc., net of tax of $1 million | 33 | (9) | (93) |
Balance at end of period | 6,059 | 6,828 | 6,571 |
Other comprehensive loss, tax | (1) | (9) | |
Foreign Currency Translation Adjustments and other | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance at beginning of period | (148) | (123) | |
Other comprehensive income/(loss), net before reclassifications | 58 | (25) | |
Amounts reclassified to earnings | (23) | 0 | |
Total other comprehensive income/(loss), net of tax | (25) | ||
Total comprehensive income/(loss) attributable to Cardinal Health, Inc., net of tax of $1 million | 35 | ||
Balance at end of period | (113) | (148) | (123) |
Unrealized Gain/(Loss) on Derivatives, net of tax | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance at beginning of period | 23 | 7 | |
Other comprehensive income/(loss), net before reclassifications | 0 | 19 | |
Amounts reclassified to earnings | (2) | (3) | |
Total other comprehensive income/(loss), net of tax | 16 | ||
Total comprehensive income/(loss) attributable to Cardinal Health, Inc., net of tax of $1 million | (2) | ||
Balance at end of period | 21 | 23 | 7 |
Accumulated Other Comprehensive Income/(Loss) | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance at beginning of period | (125) | (116) | (23) |
Other comprehensive income/(loss), net before reclassifications | 58 | (6) | |
Amounts reclassified to earnings | (25) | (3) | |
Total other comprehensive income/(loss), net of tax | (9) | ||
Total comprehensive income/(loss) attributable to Cardinal Health, Inc., net of tax of $1 million | 33 | (9) | (93) |
Balance at end of period | $ (92) | $ (125) | $ (116) |
Earnings Per Share Attributab96
Earnings Per Share Attributable to Cardinal Health, Inc. (Reconciliation of Common Shares Used to Compute Basic and Diluted EPS) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Earnings Per Share [Abstract] | |||||||||||
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | $ (1,166) | $ 255 | $ 1,053 | $ 117 | $ 278 | $ 382 | $ 324 | $ 310 | $ 259 | $ 1,294 | $ 1,431 |
Net earnings attributable to noncontrolling interest | 0 | 0 | 0 | 2 | 4 | 1 | 0 | 1 | (3) | (6) | (4) |
Net Income (Loss) Attributable to Parent | $ (1,166) | $ 255 | $ 1,053 | $ 115 | $ 274 | $ 381 | $ 324 | $ 309 | $ 256 | $ 1,288 | $ 1,427 |
Weighted-average common shares–basic (in shares) | 313 | 317 | 327 | ||||||||
Effect of dilutive securities: | |||||||||||
Employee stock options, restricted share units, and performance share units (in shares) | 2 | 3 | 3 | ||||||||
Weighted-average common shares–diluted (in shares) | 315 | 320 | 330 | ||||||||
Diluted earnings per common share attributable to Cardinal Health, Inc.: | |||||||||||
Earnings Per Share, Basic | $ 0.82 | $ 4.06 | $ 4.36 | ||||||||
Earnings Per Share, Diluted | $ 0.81 | $ 4.03 | $ 4.32 |
Earnings Per Share Attributab97
Earnings Per Share Attributable to Cardinal Health, Inc. (Narrative) (Details) - shares shares in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Earnings Per Share [Abstract] | |||
Potentially dilutive employee stock options, restricted share units and performance share units that were antidilutive (in shares) | 6 | 3 | 2 |
Segment Information (Narrative)
Segment Information (Narrative) (Details) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018USD ($)segment | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | |
Segment Reporting [Abstract] | |||
Number of Operating Segments | 2 | ||
Number of reportable segments | 2 | ||
Project costs on investment and other spending | $ | $ 43 | $ 17 | $ 34 |
Segment Information (Revenue by
Segment Information (Revenue by Reportable Segment) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Segment Reporting Information [Line Items] | |||||||||||
Total revenue | $ 35,349 | $ 33,633 | $ 35,186 | $ 32,641 | $ 32,966 | $ 31,821 | $ 33,150 | $ 32,039 | $ 136,809 | $ 129,976 | $ 121,546 |
Operating Segments | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total revenue | 136,822 | 129,987 | 121,561 | ||||||||
Operating Segments | Pharmaceutical | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total revenue | 121,241 | 116,463 | 109,131 | ||||||||
Operating Segments | Medical | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total revenue | 15,581 | 13,524 | 12,430 | ||||||||
Corporate | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total revenue | $ (13) | $ (11) | $ (15) |
Segment Information (Segment Pr
Segment Information (Segment Profit by Reportable Segment) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Total operating earnings | $ 126 | $ 2,120 | $ 2,459 |
Operating Segments | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Total operating earnings | 2,654 | 2,759 | 2,945 |
Operating Segments | Pharmaceutical | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Total operating earnings | 1,992 | 2,187 | 2,488 |
Operating Segments | Medical | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Total operating earnings | 662 | 572 | 457 |
Corporate | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Total operating earnings | $ (2,528) | $ (639) | $ (486) |
Segment Information (Depreciati
Segment Information (Depreciation and Amortization and Additions to Property and Equipment by Reportable Segment) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Segment Reporting Information [Line Items] | |||
Total depreciation and amortization | $ 1,032 | $ 717 | $ 641 |
Total additions to property and equipment | 384 | 387 | 465 |
Operating Segments | Pharmaceutical | |||
Segment Reporting Information [Line Items] | |||
Total depreciation and amortization | 156 | 122 | 128 |
Total additions to property and equipment | 58 | 50 | 88 |
Operating Segments | Medical | |||
Segment Reporting Information [Line Items] | |||
Total depreciation and amortization | 278 | 156 | 136 |
Total additions to property and equipment | 127 | 123 | 96 |
Corporate | |||
Segment Reporting Information [Line Items] | |||
Total depreciation and amortization | 598 | 439 | 377 |
Total additions to property and equipment | $ 199 | $ 214 | $ 281 |
Segment Information (Assets by
Segment Information (Assets by Reportable Segment) (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 |
Segment Reporting Information [Line Items] | |||
Total assets | $ 39,951 | $ 40,112 | $ 34,122 |
Operating Segments | Pharmaceutical | |||
Segment Reporting Information [Line Items] | |||
Total assets | 21,421 | 21,848 | 20,662 |
Operating Segments | Medical | |||
Segment Reporting Information [Line Items] | |||
Total assets | 16,066 | 10,688 | 10,236 |
Corporate | |||
Segment Reporting Information [Line Items] | |||
Total assets | $ 2,464 | $ 7,576 | $ 3,224 |
Segment Information (Revenue an
Segment Information (Revenue and Property and Equipment, net by Geographic Area) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total revenue | $ 35,349 | $ 33,633 | $ 35,186 | $ 32,641 | $ 32,966 | $ 31,821 | $ 33,150 | $ 32,039 | $ 136,809 | $ 129,976 | $ 121,546 |
Property and equipment, net | 2,487 | 1,879 | 2,487 | 1,879 | 1,796 | ||||||
United States | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total revenue | 132,526 | 125,006 | 116,864 | ||||||||
Property and equipment, net | 1,950 | 1,623 | 1,950 | 1,623 | 1,558 | ||||||
International | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total revenue | 4,283 | 4,970 | 4,682 | ||||||||
Property and equipment, net | $ 537 | $ 256 | $ 537 | $ 256 | $ 238 |
Share-Based Compensation (Narra
Share-Based Compensation (Narrative) (Details) shares in Millions, $ in Millions | 12 Months Ended | ||
Jun. 30, 2018USD ($)shares | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Tax benefit related to share-based compensation | $ | $ 23 | $ 34 | $ 38 |
Total expense on employee retirement savings plans | $ | $ 129 | $ 49 | $ 84 |
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period (in years) | 3 years | ||
Exercisable period of plans (in years) | 10 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate, Maximum | 2.10% | 2.00% | 1.90% |
Stock Options | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercisable period of plans (in years) | 10 years | ||
Restricted Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period (in years) | 3 years | ||
Performance Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period (in years) | 3 years | ||
Target performance goal (as a percent) | 133.00% | 170.00% | |
Performance Share Units | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Target performance goal (as a percent) | 0.00% | ||
Performance Share Units | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Target performance goal (as a percent) | 200.00% | ||
2011 LTIP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares available for grant | 19 | ||
2011 LTIP | Awards Other than Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares available for grant | 8 | ||
Number of shares per award issued | 2.5 | ||
2011 LTIP | Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares available for grant | 19 | ||
Number of shares per award issued | 1 |
Share-Based Compensation (Sched
Share-Based Compensation (Schedule of Total Share-Based Compensation Expense by Type of Award) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based compensation expense | $ 85 | $ 96 | $ 111 |
Restricted Share Unit | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based compensation expense | 73 | 69 | 69 |
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based compensation expense | 22 | 19 | 21 |
Performance Share Unit | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based compensation expense | $ (10) | $ 8 | $ 21 |
Share-Based Compensation (Sc106
Share-Based Compensation (Schedule of All Stock Option Transactions Under the Plans) (Details) - $ / shares shares in Millions | 12 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Stock Options | ||
Outstanding at beginning of period (in shares) | 6 | 7 |
Granted (in shares) | 2 | 1 |
Exercised (in shares) | (1) | (2) |
Canceled and forfeited (in shares) | 0 | 0 |
Outstanding at end of period (in shares) | 7 | 6 |
Exercisable at end of period (in shares) | 5 | |
Weighted-Average Exercise Price per Common Share | ||
Outstanding at beginning of period (in usd per share) | $ 63.44 | $ 54.09 |
Granted (in usd per share) | 66.39 | 83.09 |
Exercised (in usd per share) | 43.12 | 37.79 |
Canceled and forfeited (in usd per share) | 0 | 0 |
Outstanding at end of period (in usd per share) | 64.50 | $ 63.44 |
Exercisable at end of period (in usd per share) | $ 59.60 |
Share-Based Compensation (Sc107
Share-Based Compensation (Schedule of Additional Data Related to Stock Options) (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Net proceeds/(withholding) from share-based compensation | $ (3) | $ 26 | $ 6 |
Excess tax benefits from share based compensation | 0 | 34 | 33 |
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Aggregate intrinsic value of outstanding options at period end | 13 | 109 | 181 |
Aggregate intrinsic value of exercisable options at period end | 13 | 106 | 161 |
Aggregate intrinsic value of exercised options | 14 | 73 | 63 |
Net proceeds/(withholding) from share-based compensation | (3) | 26 | 6 |
Excess tax benefits from share based compensation | 10 | 34 | 33 |
Total compensation cost, net of estimated forfeitures, related to unvested stock options not yet recognized, pre-tax | 17 | 22 | 22 |
Total fair value of shares vested during the year | $ 19 | $ 19 | $ 20 |
Weighted-average grant date fair value per stock option (in usd per share) | $ 13.50 | $ 16.67 | $ 17.40 |
Share-Based Compensation Schedu
Share-Based Compensation Schedule of Remaining Stock Option Plan Data (Details) - Stock Options | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted-average remaining contractual life of outstanding options | 7 years | 7 years | 6 years |
Weighted-average remaining contractual life of exercisable options | 5 years | 6 years | 5 years |
Weighted-average period over which stock option compensation cost is expected to be recognized | 2 years | 2 years | 2 years |
Share-Based Compensation (Sc109
Share-Based Compensation (Schedule of the Range of Assumptions Used to Estimate the Fair Value of Stock Options) (Details) - Stock Options | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate (minimum) | 2.10% | 1.40% | 1.50% |
Risk-free interest rate (maximum) | 2.10% | 2.00% | 1.90% |
Expected volatility | 25.00% | 24.00% | 23.00% |
Expected life in years | 7 years | 7 years | 7 years |
Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend yield | 2.70% | 2.20% | 1.80% |
Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend yield | 2.80% | 2.50% | 2.00% |
Share-Based Compensation (Sc110
Share-Based Compensation (Schedule of All Transactions Related to Restricted Share Units Under the Plans) (Details) - $ / shares shares in Millions | 12 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Restricted Share Units | ||
Canceled and forfeited (in shares) | 0 | |
Restricted Share Units | ||
Restricted Share Units | ||
Nonvested at beginning of period (in shares) | 2 | 2 |
Granted (in shares) | 1 | 1 |
Vested (in shares) | (1) | (1) |
Canceled and forfeited (in shares) | 0 | |
Nonvested at end of period (in shares) | 2 | 2 |
Weighted-Average Grant Date Fair Value per Share | ||
Nonvested at beginning of period (in usd per share) | $ 76.72 | $ 71.73 |
Granted (in usd per share) | 65.97 | 82.34 |
Vested (in usd per share) | 78.92 | 69.23 |
Canceled and forfeited (in usd per share) | 0 | 0 |
Nonvested at end of period (in usd per share) | $ 71.58 | $ 76.72 |
Share-Based Compensation (Addit
Share-Based Compensation (Additional Data Related to Restricted Share Unit Activity) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Restricted Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total compensation cost, net of estimated forfeitures, related to nonvested restricted share and share unit awards not yet recognized, pre-tax | $ 78 | $ 73 | $ 79 |
Weighted-average period in years over which restricted share and share unit cost is expected to be recognized (in years) | 2 years | 2 years | 2 years |
Total fair value of shares vested during the year | $ 65 | $ 64 | $ 65 |
Performance Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total compensation cost, net of estimated forfeitures, related to nonvested restricted share and share unit awards not yet recognized, pre-tax | $ 1 | $ 13 | $ 17 |
Weighted-average period in years over which restricted share and share unit cost is expected to be recognized (in years) | 2 years | 2 years | 2 years |
Total fair value of shares vested during the year | $ 14 | $ 19 | $ 16 |
Share-Based Compensation (Sc112
Share-Based Compensation (Schedule of All Transactions Related to Performance Share Units Under the Plans) (Details) - $ / shares shares in Millions | 12 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Performance Share Units | ||
Canceled and forfeited (in shares) | 0 | |
Performance Share Units | ||
Performance Share Units | ||
Nonvested at beginning of period (in shares) | 0.6 | 0.8 |
Granted (in shares) | 0.2 | 0.2 |
Vested (in shares) | (0.2) | (0.4) |
Canceled and forfeited (in shares) | (0.2) | 0 |
Nonvested at end of period (in shares) | 0.4 | 0.6 |
Weighted-Average Grant Date Fair Value per Share | ||
Nonvested at beginning of period (in usd per share) | $ 77.83 | $ 63.96 |
Granted (in usd per share) | 66.43 | 83.19 |
Vested (in usd per share) | 71.57 | 51.49 |
Canceled and forfeited (in usd per share) | 0 | 0 |
Nonvested at end of period (in usd per share) | $ 66.13 | $ 77.83 |
Target performance goal (as a percent) | 133.00% | 170.00% |
Share-Based Compensation (Ad113
Share-Based Compensation (Additional Data Related to Performance Share Unit Activity) (Details) - Performance Share Units - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total compensation cost, net of estimated forfeitures, related to nonvested performance share units not yet recognized, pre-tax | $ 1 | $ 13 | $ 17 |
Weighted-average period over which performance share unit cost is expected to be recognized (in years) | 2 years | 2 years | 2 years |
Total fair value of shares vested during the year | $ 14 | $ 19 | $ 16 |
Selected Quarterly Financial114
Selected Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenue | $ 35,349 | $ 33,633 | $ 35,186 | $ 32,641 | $ 32,966 | $ 31,821 | $ 33,150 | $ 32,039 | $ 136,809 | $ 129,976 | $ 121,546 |
Gross margin | 1,735 | 1,913 | 1,861 | 1,672 | 1,623 | 1,728 | 1,602 | 1,590 | 7,181 | 6,544 | 6,543 |
Distribution, selling, general and administrative expenses | 1,270 | 1,132 | 1,131 | 1,062 | 983 | 960 | 910 | 920 | 4,596 | 3,775 | 3,648 |
Net earnings | (1,166) | 255 | 1,053 | 117 | 278 | 382 | 324 | 310 | 259 | 1,294 | 1,431 |
Less: Net earnings attributable to noncontrolling interests | 0 | 0 | 0 | 2 | 4 | 1 | 0 | 1 | (3) | (6) | (4) |
Net earnings attributable to Cardinal Health, Inc. | $ (1,166) | $ 255 | $ 1,053 | $ 115 | $ 274 | $ 381 | $ 324 | $ 309 | 256 | $ 1,288 | $ 1,427 |
Net earnings/(loss) attributable to Cardinal Health, Inc. per common share: | |||||||||||
Basic (in usd per share) | $ (3.76) | $ 0.81 | $ 3.35 | $ 0.36 | $ 0.87 | $ 1.21 | $ 1.02 | $ 0.97 | |||
Diluted (in usd per share) | $ (3.76) | $ 0.81 | $ 3.33 | $ 0.36 | $ 0.86 | $ 1.20 | $ 1.02 | $ 0.96 | |||
LIFO benefit/(charges) | $ 9 | $ (9) | |||||||||
Goodwill and Intangible Assets [Line Items] | |||||||||||
Goodwill, Impairment Loss | 1,372 | ||||||||||
Medical | |||||||||||
Goodwill and Intangible Assets [Line Items] | |||||||||||
Goodwill, Impairment Loss | $ 1,372 | $ 1,372 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | Aug. 16, 2018 | Aug. 01, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | Sep. 30, 2017 |
Subsequent Event [Line Items] | ||||||
Initial Ownership Interest Before Sale | 98.00% | |||||
Payments for Repurchase of Common Stock | $ 550 | $ 600 | $ 651 | |||
naviHealth [Member] | Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Initial Ownership Interest Before Sale | 98.00% | |||||
Proceeds from Divestiture of Businesses | $ 736 | |||||
Partnership Indirect Ownership | 100.00% | |||||
Common Shares | Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Payments for Repurchase of Common Stock | $ 600 | |||||
Common shares repurchased, amount | 9.5 | |||||
Average price per common share (in usd per share) | $ 50.45 |
Schedule II - Valuations and116
Schedule II - Valuations and Qualifying Accounts (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | $ 494 | $ 541 | $ 455 |
Charged to Costs and Expenses | (2,513) | (2,347) | (2,285) |
Charged to Other Accounts | 1 | 1 | 2 |
Deductions | (2,381) | (2,395) | (2,201) |
Balance at End of Period | 626 | 494 | 541 |
Accounts receivable | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 137 | 135 | 135 |
Charged to Costs and Expenses | (113) | (59) | (72) |
Charged to Other Accounts | 1 | 1 | 2 |
Deductions | (111) | (58) | (74) |
Balance at End of Period | 139 | 137 | 135 |
Finance notes receivable | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 9 | 19 | 14 |
Charged to Costs and Expenses | (2) | (3) | (6) |
Charged to Other Accounts | 0 | 0 | 0 |
Deductions | 0 | (13) | (1) |
Balance at End of Period | 7 | 9 | 19 |
Sales returns and allowances | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 347 | 386 | 305 |
Charged to Costs and Expenses | (2,402) | (2,285) | (2,207) |
Charged to Other Accounts | 0 | 0 | 0 |
Deductions | (2,270) | (2,324) | (2,126) |
Balance at End of Period | 479 | 347 | 386 |
Other | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 1 | 1 | 1 |
Charged to Costs and Expenses | 0 | 0 | 0 |
Charged to Other Accounts | 0 | 0 | 0 |
Deductions | 0 | 0 | 0 |
Balance at End of Period | 1 | 1 | 1 |
Pricing Disputes | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Charged to Costs and Expenses | (3) | (5) | (5) |
Prior Year Recoveries | |||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | |||
SEC Schedule, 12-09, Valuation Allowances and Reserves, Addition, Recovery | $ 1 | $ 1 | $ 2 |