AmerisourceBergen sees Q2 revenue growth

Related tags Depreciation Income statement

AmerisourceBergen’s commercial services arm was its key driver in Q2, offsetting the loss of key customer for its drug business.

Revenue for the three months ended March 31 grew 1.6 per cent to $20.1bn with the contribution from AmerisourceBergen’s specialty group (ABSG) – which provides direct to physician distribution services and commercial support – increasing by 6 per cent.

The firm said that the growth came from both its vaccine distribution business and it ‘strong’ performance by its third party logistics business.

This contrasted with AmerisourceBergen's Drug Corporation (ABDC) business – which focuses on pharmacy distribution, staffing and market consulting services – which the firm said had generated flat revenue compared with the year-earlier quarter largely due to the loss of an unidentified retail customer.

Despite the revenue growth operating income for the period increased only modestly, climbing just 0.8 percent to $368 m due – according to the firm - to higher costs.

“The increase in operating expenses was driven by $9.0m in employee severance and acquisition-related transaction costs, the operating expenses of our recently acquired companies, and increased depreciation and amortization expenses, which was offset in large part by a significant improvement in distribution, selling and administrative expenses.”

CEO Steven Collis was upbeat about the performance, commenting that: "We overcame a challenging comparison with the prior year, we continued to demonstrate tremendous expense and working capital discipline, and our balance sheet remains strong, giving us outstanding financial flexibility.”

He also spoke about AmerisourceBergen’s acquisitions – explaining that the integration of reimbursement services firm Theracom is on track and that the planned purchase of trial distribution services provider World Courier is about to complete.

“We expect to complete our $520m acquisition of World Courier Group by the end of April, and we are excited to welcome their 2,500 associates to AmerisourceBergen, and to explore the possibilities of extending our capabilities in select international markets."