\n| \n Operating Expenses<\/b><\/p>\n<\/td>\n | \n $1,267M<\/i><\/p>\n<\/td>\n | \n $996M<\/i><\/p>\n<\/td>\n<\/tr>\n\n| \n Operating Income<\/b><\/p>\n<\/td>\n | \n $621M<\/i><\/p>\n<\/td>\n | \n $631M<\/i><\/p>\n<\/td>\n<\/tr>\n\n| \n Interest Expense, Net<\/b><\/p>\n<\/td>\n | \n $51M<\/i><\/p>\n<\/td>\n | \n $51M<\/i><\/p>\n<\/td>\n<\/tr>\n\n| \n Effective Tax Rate<\/b><\/p>\n<\/td>\n | \n 48.5%<\/i><\/p>\n<\/td>\n | \n 21.0%<\/i><\/p>\n<\/td>\n<\/tr>\n\n| \n Net Income Attributable to ABC<\/b><\/p>\n<\/td>\n | \n $292M<\/i><\/p>\n<\/td>\n | \n $452M<\/i><\/p>\n<\/td>\n<\/tr>\n\n| \n Diluted Earnings Per Share<\/b><\/p>\n<\/td>\n | \n $1.40<\/i><\/p>\n<\/td>\n | \n $2.16<\/i><\/p>\n<\/td>\n<\/tr>\n\n| \n Diluted Shares Outstanding<\/b><\/p>\n<\/td>\n | \n 209M<\/i><\/p>\n<\/td>\n | \n 209M<\/i><\/p>\n<\/td>\n<\/tr>\n<\/table>\n \nBelow, AmerisourceBergen presents descriptive summaries of the Company\u2019s GAAP and adjusted (non-GAAP) quarterly results. In the tables that follow, GAAP results and GAAP to non-GAAP reconciliations are presented. For more information related to non-GAAP financial measures, including adjustments made in the periods presented, please refer to the “Supplemental Information Regarding non-GAAP Financial Measures” following the tables.\n<\/p>\n Third Quarter GAAP Results<\/span><\/b><\/p>\n\n- Revenue:<\/span> In the third quarter of fiscal 2021, revenue was $53.4 billion, up 17.7 percent compared to the same quarter in the previous fiscal year, reflecting a 13.2 percent increase in Pharmaceutical Distribution Services revenue and a 128.0 percent increase in revenue within Other primarily driven by the June 2021 acquisition of Alliance Healthcare.\n<\/li>\n<\/ul>\n
\n- Gross Profit:<\/span> Gross profit in the third quarter of fiscal 2021 was $1.9 billion, a 54.0 percent increase compared to the same period in the previous fiscal year. Gross profit was favorably impacted by increases in gross profit in Pharmaceutical Distribution Services and Other, a LIFO credit in the current year quarter in comparison to a LIFO expense in the prior year quarter and increases in gains from antitrust litigation settlements. Gross profit as a percentage of revenue was 3.54%, an increase of 84 basis points from the prior year quarter primarily driven by the acquisition of Alliance Healthcare, an increase in sales of specialty products in Pharmaceutical Distribution Services and growth in some of the Company’s higher margin businesses.\n<\/li>\n<\/ul>\n
\n- Operating Expenses:<\/span> In the third quarter of fiscal 2021, operating expenses were $1,267.5 million, a 54.4 percent increase compared to the same period last fiscal year. The increase in operating expenses was primarily due to the acquisition of Alliance Healthcare and a $124.3 million accrual related to opioid settlement discussions. Operating expenses as a percentage of revenue in the fiscal 2021 third quarter were 2.37 percent, compared to 1.81 percent for the same period in the previous fiscal year primarily due to the items mentioned above.\n<\/li>\n<\/ul>\n
\n- Operating Income:<\/span> In the fiscal 2021 third quarter, operating income increased to $620.7 million from $404.8 million. Operating income as a percentage of revenue was 1.16 percent in the third quarter of fiscal 2021, compared to 0.89 percent for the same period in the previous fiscal year primarily due to the acquisition of Alliance Healthcare and growth in some of the Company’s higher margin businesses.\n<\/li>\n<\/ul>\n
\n- Interest Expense, Net:<\/span>In the fiscal 2021 third quarter, net interest expense of $51.3 million was up 36.0 percent versus the prior year quarter due to the issuance of debt to finance a portion of the acquisition of Alliance Healthcare.\n<\/li>\n<\/ul>\n
\n- Effective Tax Rate:<\/span> The effective tax rate was 48.5 percent for the third quarter of fiscal 2021 primarily due to tax reform in the United Kingdom. This compares to 16.5 percent in the prior year quarter, which was favorably impacted by a discrete tax benefit.\n<\/li>\n<\/ul>\n
\n- Diluted Earnings Per Share:<\/span> Diluted earnings per share was $1.40 in the third quarter of fiscal 2021 compared to $1.41 in the previous fiscal year\u2019s third quarter.\n<\/li>\n<\/ul>\n
\n- Diluted Shares Outstanding:<\/span> Diluted weighted average shares outstanding for the third quarter of fiscal 2021 were 208.9 million, a 1.6 percent increase versus the prior fiscal year third quarter resulting from stock option exercises, restricted stock vesting, and the issuance of 2 million Company shares to Walgreens for the June 2021 acquisition of Alliance Healthcare.\n<\/li>\n<\/ul>\n
Third Quarter Adjusted (non-GAAP) Results<\/span><\/b><\/p>\n\n- Revenue:<\/span> No adjustments were made to the GAAP presentation of revenue. In the third quarter of fiscal 2021, revenue was $53.4 billion, up 17.7 percent compared to the same quarter in the previous fiscal year, reflecting a 13.2 percent increase in Pharmaceutical Distribution Services revenue and an 128.0 percent increase in revenue within Other primarily driven by the June 2021 acquisition of Alliance Healthcare.\n<\/li>\n<\/ul>\n
\n- Adjusted Gross Profit:<\/span> Adjusted gross profit in the fiscal 2021 third quarter was $1.6 billion, which was up 32.0 percent compared to the same period in the previous fiscal year due to the Alliance Healthcare acquisition and increases in gross profit in Pharmaceutical Distribution Services and Other. Adjusted gross profit as a percentage of revenue was 3.05 percent in the fiscal 2021 third quarter, an increase of 33 basis points when compared to the prior year quarter primarily driven by the Alliance Healthcare acquisition, an increase in sales of specialty products in Pharmaceutical Distribution Services and growth in some of the Company’s higher margin businesses.\n<\/li>\n<\/ul>\n
\n- Adjusted Operating Expenses:<\/span> In the third quarter of fiscal 2021, adjusted operating expenses were $996.2 million, an increase of 37.5 percent compared to the same period in the previous fiscal year due to the acquisition of Alliance Healthcare and an increase in payroll-related operating costs to support the Company’s current and future revenue growth. Adjusted operating expenses as a percentage of revenue in the fiscal 2021 third quarter was 1.87 percent, an increase of 27 basis points when compared to the prior year quarter primarily due to the acquisition of Alliance Healthcare.\n<\/li>\n<\/ul>\n
\n- Adjusted Operating Income:<\/span> In the fiscal 2021 third quarter, adjusted operating income of $630.6 million increased 24.3 percent from the prior year quarter due to a 13.4 percent increase in Pharmaceutical Distribution Services’ operating income and a 77.2 percent increase in operating income within Other. Adjusted operating income as a percentage of revenue was 1.18 percent in the fiscal 2021 third quarter, an increase of 6 basis points when compared to the prior year quarter due to the Alliance Healthcare acquisition and growth in higher margin businesses.\n<\/li>\n<\/ul>\n
\n- Interest Expense, Net:<\/span>No adjustments were made to the GAAP presentation of net interest expense.In the fiscal 2021 third quarter, net interest expense of $51.3 million was up 36.0 percent versus the prior year quarter due to the issuance of debt to finance a portion of the acquisition of Alliance Healthcare.\n<\/li>\n<\/ul>\n
\n- Adjusted Effective Tax Rate:<\/span> The adjusted effective tax rate was 21.0 percent for the third quarter of fiscal 2021 compared to 18.8 percent in the prior year quarter, which benefited from a discrete tax item.\n<\/li>\n<\/ul>\n
\n- Adjusted Diluted Earnings Per Share:<\/span> Adjusted diluted earnings per share was up 16.8 percent to $2.16 in the third quarter of fiscal 2021 compared to $1.85 in the previous fiscal year\u2019s third quarter, driven by the increase in adjusted operating income and partially offset by higher interest expense, a higher effective tax rate, and a higher diluted share count.\n<\/li>\n<\/ul>\n
\n- Diluted Shares Outstanding:<\/span> No adjustments were made to the GAAP presentation of diluted shares outstanding. Diluted weighted average shares outstanding for the third quarter of fiscal 2021 were 208.9 million, a 1.6 percent increase versus the prior fiscal year third quarter resulting from stock option exercises, restricted stock vesting, and the issuance of 2 million Company shares to Walgreens for the June 2021 acquisition of Alliance Healthcare.\n<\/li>\n<\/ul>\n
Segment Discussion<\/span><\/b><\/p>\n\nThe Company’s operations are comprised of the Pharmaceutical Distribution Services reportable segment and other operating segments that are not significant enough to require separate reportable segment disclosure and, therefore, have been included in Other for the purpose of the reportable segment presentation. Other consists of operating segments that focus on global commercialization services, animal health (MWI Animal Health or “MWI”), and international pharmaceutical wholesale and related service operations (Alliance Healthcare). The operating segments that focus on global commercialization services include AmerisourceBergen Consulting Services (“ABCS”) and World Courier.\n<\/p>\n Pharmaceutical Distribution Services Segment<\/span><\/i><\/p>\n\nPharmaceutical Distribution Services revenue was $49.3 billion in the third quarter of fiscal 2021, an increase of 13.2 percent compared to the same quarter in the prior fiscal year primarily due to increased sales of specialty products, including COVID-19 treatments, and overall market growth. Segment operating income of $483.9 million in the third quarter of fiscal 2021 was up 13.4 percent compared to the same period in the previous fiscal year as a result of strong performance across our distribution businesses including increased sales of specialty products.\n<\/p>\n Other<\/span><\/i><\/p>\n\nRevenue in Other was $4.1 billion in the third quarter of fiscal 2021, an increase of 128.0 percent compared to the same period in the prior fiscal year primarily due to the acquisition of Alliance Healthcare and growth in the other operating segments: MWI, World Courier, and ABCS. Operating income in Other increased 77.2 percent to $146.9 million in the third quarter of fiscal 2021 primarily due to the acquisition of Alliance Healthcare and growth at MWI and World Courier.\n<\/p>\n Recent Company Highlights & Milestones<\/span><\/b><\/p>\n\n- \nAmerisourceBergen announced the completion of its acquisition of the majority of Walgreens Boots Alliance\u2019s Alliance Healthcare businesses. The acquisition extends AmerisourceBergen\u2019s pharmaceutical distribution presence and global platform of manufacturer services to support pharmaceutical innovation.\n<\/li>\n
- \nGood Neighbor Pharmacy, AmerisourceBergen\u2019s national independent pharmacy network, announced that it has been ranked \u201cHighest in Customer Satisfaction with Chain Drug Store Pharmacies\u201d in the J.D. Power 2020 U.S. Pharmacy Study. This marks the tenth time that Good Neighbor Pharmacy has earned the achievement in the last 12 years.\n<\/li>\n
- \nAmerisourceBergen was named 8th on the 2021 DiversityInc Philanthropy list. Launched in 2001, the survey is the most comprehensive, data-driven D&I analysis of some of the largest U.S. employers. The assessment collects data across six key areas: Leadership Accountability, Human Capital Diversity Metrics, Talent Programs, Workforce Practices, Supplier Diversity, and Philanthropy.\n<\/li>\n<\/ul>\n
Fiscal Year 2021 Expectations<\/span><\/b><\/p>\n\nThe Company does not provide forward-looking guidance on a GAAP basis as certain financial information, the probable significance of which cannot be determined, is not available or cannot be reasonably estimated. Please refer to the Supplemental Information Regarding Non-GAAP Financial Measures following the tables for additional information.\n<\/p>\n Fiscal Year 2021 Expectations on an Adjusted (non-GAAP) Basis<\/span><\/b><\/p>\n\nIn June 2021, AmerisourceBergen updated its fiscal year 2021 financial guidance for revenue, adjusted diluted EPS and weighted average shares following the closing of the Alliance Healthcare acquisition to reflect the expected contribution from Alliance Healthcare and the weighted average share count impact of the 2 million shares of AmerisourceBergen common stock that the Company delivered to Walgreens at the closing of the transaction.\n<\/p>\n \nAmerisourceBergen is now updating its fiscal year 2021 financial guidance to reflect the Company\u2019s continued strong performance across its businesses. The Company now expects:\n<\/p>\n | | | | | | |