McKesson 1Q profit remains flat as costs rise

The company, which distributes drugs, medical supplies and health care products, earned $235 million, or 83 cents per share, compared with profit of $235 million, or 77 cents, during the same period a year earlier. There were 22 million, or 7 percent, fewer shares of common stock outstanding during the most recent quarter.

Revenue rose 9 percent to $26.7 billion from $24.5 billion.

Analysts surveyed by Thomson Financial expected earnings per share of 80 cents, on revenue of $26.03 billion.

Revenue from the company's distribution solutions unit rose 9 percent to $26.96 billion. Within that unit, U.S. pharmaceutical revenue rose 16 percent to $16.4 billion, while Canadian revenue jumped 27 percent to $2.2 billion.

Meanwhile, the technology solutions unit, which provides software to manage a range of health care-related tasks, showed a 2 percent rise in revenue to $744 million.

"While we faced a challenging comparison this quarter versus a year ago, we remain optimistic about our full-year results," said John H. Hammergren, chairman and chief executive. "We continue to invest in the business with new product development, and we have made recent acquisitions that create further opportunities to offer our customers comprehensive solutions."

McKesson's cost of sales rose 9 percent to $25.44 billion, while operating expenses rose 9 percent to $897 million.

Shares of McKesson fell $2.74, or 4.7 percent, to $56.11 in after-hours trading, after rising $2.93, or 5.2 percent, to close the regular session at $58.85.