8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 28, 2009

PSS WORLD MEDICAL, INC.

(Exact name of Registrant as specified in its charter)

Commission File Number: 0-23832

Florida	59-2280364
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification Number)

4345 Southpoint Blvd. Jacksonville, Florida	32216
(Address of principal executive offices)	(Zip code)

Registrant’s telephone number, including area code (904) 332-3000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Disclosure of Results of Operations and Financial Condition.

Item 8.01 Other Events

On October 28, 2009, PSS World Medical, Inc. (the “Company”) issued a press release in which the Company announced its financial results for the three and six months ended October 2, 2009. In this press release, the Company also disclosed an increase to the fiscal year 2010 financial guidance. This press release is attached as Exhibit 99.1 to this report and is incorporated herein by reference. In connection with the press release, the Company has also made available certain supplemental financial information (the “Financial Supplement”) for the three and six months ended October 2, 2009, which may be found on the Company’s website at www.pssd.com. This Financial Supplement is attached as Exhibit 99.2 to this report and is incorporated herein by reference.

The Financial Supplement contains financial measures that are not in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The Company has provided reconciliations within the Financial Supplement of the non-GAAP financial measures to the most directly comparable GAAP financial measures.

The Company provides non-GAAP financial measures to supplement its consolidated financial statements presented in accordance with GAAP. These non-GAAP financial measures are intended to supplement the user’s overall understanding of the Company’s current financial performance and its prospects for the future. Specifically, the Company believes the non-GAAP results provide useful information to both management and investors by identifying certain expenses, gains and losses that, when excluded from the GAAP results, may provide additional understanding of the Company’s core operating results or business performance. However, these non-GAAP financial measures are not intended to supersede or replace the Company’s GAAP results.

Item 9.01 Financial Statements and Exhibits.

Exhibit Number	Description
99.1	Press Release dated October 28, 2009 with respect to the Registrant’s financial results for the three and six months ended October 2, 2009.
99.2	Financial Supplement for the three and six months ended October 2, 2009.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: October 28, 2009

PSS WORLD MEDICAL, INC.
By:	/S/    DAVID M. BRONSON
Name:	David M. Bronson
Title:	Executive Vice President and Chief Financial Officer

EXHIBIT INDEX

99.1	Press Release dated October 28, 2009.
99.2	Financial Supplement for the three and six months ended October 2, 2009.

EX-99.1

Exhibit 99.1

Contacts:
For investors:	Robert C. Weiner	For media:	Brian C. Kosoy
	Vice President, Investor Relations		Senior Associate, Public Relations
	904-332-3287		904-332-4175

PSS WORLD MEDICAL REPORTS RESULTS FOR

FISCAL YEAR 2010 SECOND QUARTER

Company Increases FY 2010 GAAP Earnings Per Share Goal

to $1.15 - $1.17 from Previous Goal of $1.05 - $1.09

Second Quarter Highlights:

• Consolidated net sales growth of 14.3%, with same day sales growth of 5.9%

• Physician Business net sales growth of 16.6%, with same day sales growth of 8.0%

• Elder Care Business net sales growth of 9.0%, with same day sales growth of 1.0%

• Consolidated operating margin growth of 191 basis points to 6.9%

• Physician Business operating margin growth of 302 basis points to 10.7%

• Elder Care Business operating margin growth of 152 basis points to 7.1%

• Consolidated income from operations growth of 58.3% to $38.6 million

• Consolidated earnings per diluted share growth of 79.9% to $0.37

• Consolidated cash flow from operations of $8.7 million

• Company notes the following events in the second quarter:

• Physician business product sales related to H1N1/Swine flu of approximately $23 million

• Corporate general and administrative expenses increased by $3.9 million, pre-tax, as a result of changes in performance estimates for short-term and long-term incentive plans

Jacksonville, Florida (October 28, 2009) – PSS World Medical, Inc. (NasdaqGS: PSSI) announced today its results for the fiscal 2010 second quarter ended October 2, 2009.

David A. Smith, Chairman and Chief Executive Officer, commented, “Fundamental customer economic conditions have held steady. We believe we have the right strategies and programs for this environment. Our team continues to execute lean initiatives that reduce costs and improve efficiencies in concert with a highly energized campaign to reach new customers and strengthen existing customers with unique and timely solutions.

“We are extremely proud of our team’s performance. Based on their performance to date, we are raising our earnings goal for this fiscal year by $0.09 per diluted share, at the midpoint of the range. We are confident of our ability to achieve our growth plans for the remainder of fiscal year 2010.”

PSSI Reports Results for Fiscal Year 2010 Second Quarter

Page 2

October 28, 2009

Net sales for the three months ended October 2, 2009, were $562.0 million, an increase of 14.3% (5.9% same day sales growth), compared with net sales of $491.6 million for the three months ended September 26, 2008. Net sales for the three months ended October 2, 2009, for the Physician Business increased by 16.6%, with same day sales growth of 8.0% (1.8% same day sales growth excluding H1N1-related product sales) and increased by 9.0%, with same days sales growth of 1.0%, for the Elder Care Business. Income from operations for the three months ended October 2, 2009, was $38.6 million compared with income from operations for the three months ended September 26, 2008, of $24.4 million. Net income for the three months ended October 2, 2009, was $21.7 million, or $0.37 per diluted share, compared with net income for the three months ended September 26, 2008, of $12.4 million, or $0.20 per diluted share. The Company noted that it had five additional sales days (68 sales days) in the fiscal year 2010 second quarter, ended October 2, 2009, compared with the number of sales days (63 sales days) in the fiscal year 2009 second quarter, ended September 26, 2008. The Company will have five fewer sales days (61 sales days) in the third quarter of fiscal year 2010, ended January 1, 2010, compared with the number of sales days (66 sales days) in the third quarter of fiscal year 2009, ended January 2, 2009.

Net sales for the six months ended October 2, 2009, were $1,055.5 million, an increase of 9.5%, compared with net sales of $963.8 million for the six months ended September 26, 2008. Net sales for the six months ended October 2, 2009, for the Physician Business increased by 10.1%, and increased by 8.1% for the Elder Care Business. Income from operations for the six months ended October 2, 2009, was $60.3 million compared with income from operations for the six months ended September 26, 2008, of $42.4 million. Net income for the six months ended October 2, 2009, was $35.0 million, or $0.59 per diluted share, compared with net income for the six months ended September 26, 2008, of $21.7 million, or $0.35 per diluted share.

David M. Bronson, Executive Vice President and Chief Financial Officer, commented, “Successful execution of our core business strategies drove record profitability in the quarter and continued to differentiate our performance. The five extra selling days certainly helped to leverage our fixed costs, but net income per billing day still grew by 63%.

“We made, and are continuing to make, a large investment in inventory of H1N1 flu-related products in order to service our customers and help them effectively deal with this pandemic. This investment contributed approximately $2.9 million of operating income during the quarter and has had a positive impact on our record-level return on committed capital. As a result, we are increasing our fiscal year 2010 goal for operating cash flow to $96 - $102 million.”

The Company noted the adoption, on March 30, 2009, of ASC 470-20, Debt-Debt with Conversion and Other Option (formerly FSP APB 14-1, Accounting for Convertible Debt Instruments that may be settled in Cash Upon Conversion), which increased non-cash interest expense by $1.2 million, after-tax ($1.9 million pre-tax), or approximately $0.02 per diluted share in the second quarter of fiscal year 2010. In accordance with guidelines established by this pronouncement, the Company has restated prior fiscal year 2009 results for comparability. The effect of the restatement was to increase non-cash interest expense for the second quarter of fiscal year 2009, by $1.5 million, after-tax ($2.5 million pre-tax), or approximately $0.03 per diluted share. Non-cash interest expense for the six months ended October 2, 2009, was $2.3 million, after-tax ($3.7 million pre-tax), or approximately $0.04 per diluted share, compared with non-cash interest expense for the six months ended September 26, 2008, of $2.5 million, after-tax ($4.0 million pre-tax), or approximately $0.04 per diluted share.

PSSI Reports Results for Fiscal Year 2010 Second Quarter

Page 3

October 28, 2009

A listen-only simulcast as well as a 90-day online replay of PSS World Medical’s fiscal year 2010 second quarter conference call can be found in the Investor Relations/Financial Information sections of the Company’s websites, www.pssworldmedical.com or www.pssd.com, respectively, under the heading “Events and Presentations,” or at www.opencompany.info, on October 29, 2009, beginning at 8:30 a.m. Eastern time.

The Company has today filed with the SEC a Form 8-K that includes a copy of this press release and its related Fiscal Year 2010 Second Quarter Financial Workbook, which contains GAAP and non-GAAP financial measures, and is available on the Company’s website, www.pssworldmedical.com. Additional financial information pertaining to PSS World Medical financial results may be found by visiting the Investor Relations/Financial Information sections of the Company’s websites, www.pssworldmedical.com or www.pssd.com, respectively, under the heading “Events and Presentations.” If you should need assistance accessing the information, please call Investor Relations at 904-332-3000.

PSS World Medical, Inc. is a national distributor of medical products to physicians and elder care providers through its two business units. Since its inception in 1983, PSS has become a leader in the two market segments that it serves with a focused market approach to customer services, a consultative sales force, strategic acquisitions, strong arrangements with product manufacturers and a unique culture of performance.

Certain statements in this release are “forward-looking statements” made pursuant to the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements are identified by the use of words such as “expect,” “may,” “will,” “should,” “believe,” “plan,” “anticipate,” and “estimate” among others. These statements involve a number of risks and uncertainties, many of which are outside the control of the Company. Actual results may differ materially from those identified in the forward-looking statements. Among the factors that could cause results to differ materially are the following: fluctuating demand for our products and services; the weakening of national and global economic conditions, including our and our customers’ ability to obtain financing; the introduction of new products and services offered by us and our competitors; uncertainty of the impact of the new presidential administration’s health care policies; proper functioning of our data processing and information technology systems; our ability to successfully execute our global sourcing strategy; pricing pressures on large national and regional accounts and GPOs; customer credit quality and our ability to collect our accounts receivable, particularly in states with significant budget deficits; our ability to compete with other medical supply companies and direct manufacturers; multi-tiered cost structures where certain institutions can obtain more favorable prices for medical products than us; our ability to maintain relationships with our suppliers and customers; our ability to retain sales reps and key management; our ability to execute our growth strategy; increased operating costs, including fuel prices; risks involved in maintaining a large amount of inventory; our indebtedness may limit our ability to obtain additional financing or react to market conditions; we face litigation and product liability exposure; weather-related events such as hurricanes may disrupt our and our customers’ business; we may be deemed to infringe other persons intellectual property; our business is subject to numerous federal, state and foreign laws and regulations, including state pedigree laws and regulations; general business competitive and economic factors and conditions; and other factors described from time to time in the Company’s reports filed with the Securities and Exchange Commission.PSS assumes no obligation to update the information in this release except as otherwise required by law. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.

PSSI Reports Results for Fiscal Year 2010 Second Quarter

Page 4

October 28, 2009

PSS WORLD MEDICAL, INC.

Unaudited Condensed Consolidated Statement of Operations

(in millions, except per share and share data)

	Three Months Ended						Six Months Ended
	Oct. 2, 2009			Sept. 26, 2008			Oct. 2, 2009			Sept. 26, 2008
Net sales	$	562.0		$	491.6		$	1,055.5		$	963.8
Cost of goods sold		389.4			344.3			737.0			677.6
Gross profit		172.6			147.3			318.5			286.2
General and administrative expenses		97.2			90.7			188.8			180.3
Selling expenses		36.8			32.2			69.4			63.5
Income from operations		38.6			24.4			60.3			42.4
Other (expense) income:
Interest expense		(4.5	)		(5.3	)		(8.8	)		(8.5	)
Interest income		0.1			0.8			0.2			1.0
Other income		0.5			0.6			4.5			1.1
		(3.9	)		(3.9	)		(4.1	)		(6.4	)
Income before provision for income taxes		34.7			20.5			56.2			36.0
Provision for income taxes		13.0			8.1			21.2			14.3
Net income	$	21.7		$	12.4		$	35.0		$	21.7
Earnings per share – basic	$	0.37		$	0.21		$	0.60		$	0.36
Earnings per share – diluted	$	0.37		$	0.20		$	0.59		$	0.35
Weighted average shares (in thousands):
Basic		58,566			59,941			58,477			60,472
Diluted		59,390			60,921			59,172			61,322

PSSI Reports Results for Fiscal Year 2010 Second Quarter

Page 5

October 28, 2009

PSS WORLD MEDICAL, INC.

Unaudited Consolidated Balance Sheets

(in millions except share data)

	Oct. 2, 2009			March 27, 2009
ASSETS
Current Assets:
Cash and cash equivalents	$	130.1		$	82.0
Investment in available for sale securities		—			10.6
Accounts receivable, net		258.0			230.4
Inventories		212.8			207.6
Prepaid expenses		4.3			3.2
Other current assets		32.1			28.7
Total current assets		637.3			562.5
Property and equipment, net		105.5			101.2
Other Assets:
Goodwill		115.3			112.8
Intangibles, net		21.6			23.0
Other		73.8			59.1
Total assets	$	953.5		$	858.6
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	157.0		$	127.3
Accrued expenses		43.2			52.7
Revolving line of credit and current portion of long-term debt		51.0			50.9
Other		13.6			8.0
Total current liabilities		264.8			238.9
Long-term debt, excluding current portion		184.5			181.0
Other noncurrent liabilities		80.0			60.7
Total liabilities		529.3			480.6
Shareholders’ Equity:
Preferred stock, $0.01 par value; 1,000,000 shares authorized, no shares issued and outstanding		—			—
Common stock, $0.01 par value; 150,000,000 shares authorized, 59,652,676 and 59,316,697 shares issued and outstanding at October 2, 2009 and March 27, 2009, respectively		0.6			0.6
Additional paid-in capital		213.4			200.2
Retained earnings		210.6			175.6
Accumulated other comprehensive income		(0.4	)		1.6
Total shareholders’ equity		424.2			378.0
Total liabilities and shareholders’ equity	$	953.5		$	858.6

PSSI Reports Results for Fiscal Year 2010 Second Quarter

Page 6

October 28, 2009

PSS WORLD MEDICAL, INC.

Unaudited Condensed Consolidated Statements of Cash Flows

(in millions)

	Three Months Ended						Six Months Ended
	Oct. 2, 2009			Sept. 26, 2008			Oct. 2, 2009			Sept. 26, 2008
Cash Flows From Operating Activities:
Net income	$	21.7		$	12.3		$	35.0		$	21.7
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		5.3			4.9			10.5			9.7
Provision for deferred income taxes		1.2			(2.0	)		1.3			(0.4	)
Noncash compensation expense		4.3			1.8			10.4			3.4
Amortization of intangible assets		1.2			1.6			2.4			2.9
Provision for doubtful accounts		1.3			0.8			2.5			2.6
Provision for deferred compensation		0.4			0.3			0.8			0.9
Amortization of debt discount and issuance costs		2.4			3.0			4.6			4.9
Loss on sales of property and equipment		—			—			0.1			—
Gain on sale of available for sale securities		—			—			(3.6	)		—
Changes in operating assets and liabilities, net of effects from business combinations:
Accounts receivable, net		(28.7	)		(13.9	)		(29.8	)		(5.4	)
Inventories		(16.1	)		(6.6	)		(4.2	)		(8.1	)
Prepaid expenses and other current assets		(19.8	)		2.7			(24.9	)		2.9
Other assets		(2.8	)		(2.9	)		(3.2	)		(4.1	)
Accounts payable		22.5			20.9			28.8			13.1
Accrued expenses & other liabilities		15.8			15.8			22.9			8.4
Net cash provided by operating activities		8.7			38.7			53.6			52.5
Cash Flows From Investing Activities:
Capital expenditures		(7.2	)		(6.8	)		(14.9	)		(12.7	)
Payments for business acquisitions, net of cash acquired		(1.8	)		(0.1	)		(3.9	)		(2.7	)
Proceeds from sale of available for sale securities		—			—			10.7			21.0
Other		0.1			(0.1	)		—			(0.2	)
Net cash (used in) provided by investing activities		(8.9	)		(7.0	)		(8.1	)		5.4
Cash Flows From Financing Activities:
Proceeds from issuance of convertible debt		—			230.0			—			230.0
Proceeds from issuance of warrants		—			25.4			—			25.4
Proceeds from exercise of stock options		0.7			3.2			2.4			5.6
Excess tax benefits from share-based compensation arrangements		0.6			1.1			1.1			1.5
Payment for purchase of hedge on convertible note		—			(54.1	)		—			(54.1	)
Purchase of common stock		(0.4	)		(35.6	)		(0.4	)		(35.6	)
Net payments on the revolving line of credit		—			—			—			(20.0	)
Payment for debt issue costs		—			(5.1	)		—			(5.1	)
Payments under capital lease obligations		(0.2	)		(0.3	)		(0.5	)		(0.6	)
Net cash provided by financing activities		0.7			164.6			2.6			147.1
Net increase in cash and cash equivalents		0.5			196.3			48.1			205.0
Cash and cash equivalents, beginning of period		129.6			29.8			82.0			21.1
Cash and cash equivalents, end of period	$	130.1		$	226.1		$	130.1		$	226.1

-END-

EX-99.2

Exhibit 99.2

Financial Supplement

For the Second Quarter of Fiscal Year 2010 ending October 2, 2009

PSS World Medical, Inc.

As of October 2, 2009

Current Fiscal Year

(in thousands, except per share data)

	Fiscal 2010
	Q1			Q2
Net sales	$	493,554		$	561,976
Cost of goods sold		347,581			389,404
Gross profit		145,974			172,571
General & administrative expenses		91,638			97,208
Selling expenses		32,687			36,728
Income from operations		21,649			38,635
Interest expense		(4,261	)		(4,532	)
Interest & investment income		134			95
Other income		3,995			452
Income from ops before income taxes		21,517			34,650
Provision for income taxes		8,213			12,964
Net income	$	13,304		$	21,686
Earnings per share - basic:
Net income	$	0.23		$	0.37
Earnings per share - Diluted:
Net income	$	0.23		$	0.37
WASO - Basic		58,380			58,566
WASO - Diluted		58,859			59,390
Net sales by segment:
Physician Business	$	342,292		$	398,531
Elder Care Business		150,381			162,970
Corporate Shared Services		882			475
	$	493,554		$	561,976
Billing days:		64			68
Net sales per billing day:
Physician Business	$	5,348		$	5,861
Elder Care Business		2,350			2,397
Corporate Shared Services		14			7
	$	7,712		$	8,264

Numbers may not foot due to rounding differences

PSS World Medical, Inc.

As of October 2, 2009

(in thousands, except per share data)

	Fiscal 2007															Fiscal 2008															Fiscal 2009
	Q1			Q2			Q3			Q4			Total			Q1			Q2			Q3			Q4			Total			Q1			Q2			Q3			Q4			Total
Net Sales	$	413,135		$	427,059		$	458,421		$	443,024		$	1,741,639		$	438,910		$	457,930		$	465,208		$	493,744		$	1,855,791		$	472,215		$	491,603		$	519,145		$	469,728		$	1,952,691
Cost of Goods Sold		293,233			303,204			335,185			310,008			1,241,629			311,227			325,390			330,215			347,289			1,314,120			333,283			344,347			364,282			328,868			1,370,781
Gross Profit		119,902			123,856			123,235			133,017			500,010			127,683			132,540			134,993			146,455			541,672			138,931			147,255			154,863			140,860			581,910
General & Administrative Expenses		73,695			73,422			75,253			78,453			300,824			83,638			77,353			79,408			83,725			324,124			89,634			90,689			89,426			82,728			352,478
Selling Expenses		27,498			28,878			30,140			30,308			116,823			29,551			30,763			31,509			33,473			125,295			31,266			32,161			33,721			31,356			128,505
Income from operations		18,709			21,556			17,842			24,255			82,362			14,494			24,425			24,077			29,257			92,253			18,031			24,405			31,715			26,776			100,927
Interest Expense		(2,691	)		(2,635	)		(2,642	)		(2,631	)		(10,597	)		(2,764	)		(2,956	)		(3,247	)		(3,529	)		(12,495	)		(3,203	)		(5,300	)		(7,409	)		(6,247	)		(22,159	)
Interest & Investment Income		98			282			426			385			1,191			528			114			26			23			691			122			842			1,034			305			2,304
Other Income		469			429			517			591			2,006			544			546			833			5,361			7,284			608			520			877			638			2,643
Income from Continuing Operations before Income Taxes		16,588			19,632			16,144			22,601			74,965			12,802			22,129			21,690			31,112			87,732			15,559			20,467			26,218			21,472			83,716
Provision for Income Taxes		6,449			7,681			5,862			7,824			27,817			5,010			8,551			8,441			12,597			34,599			6,187			8,104			10,230			7,709			32,229
Income from Continuing Operations		10,139			11,951			10,282			14,777			47,148			7,792			13,578			13,249			18,515			53,133			9,372			12,363			15,989			13,763			51,486
Net Income	$	10,137		$	11,951		$	10,282		$	14,777		$	47,146		$	7,792		$	13,578		$	13,249		$	18,515		$	53,133		$	9,372		$	12,363		$	15,989		$	13,763		$	51,486
Earnings per share - Basic:
Income from Continuing Operations	$	0.15		$	0.18		$	0.15		$	0.22		$	0.70		$	0.12		$	0.21		$	0.21		$	0.30		$	0.82		$	0.15		$	0.21		$	0.27		$	0.23		$	0.86
Net Income	$	0.15		$	0.18		$	0.15		$	0.22		$	0.70		$	0.12		$	0.21		$	0.21		$	0.30		$	0.82		$	0.15		$	0.21		$	0.27		$	0.23		$	0.86
Earnings per share - Diluted:
Income from Continuing Operations	$	0.15		$	0.17		$	0.15		$	0.21		$	0.68		$	0.11		$	0.20		$	0.20		$	0.29		$	0.80		$	0.15		$	0.20		$	0.27		$	0.23		$	0.85
Net Income	$	0.15		$	0.17		$	0.15		$	0.21		$	0.68		$	0.11		$	0.20		$	0.20		$	0.29		$	0.80		$	0.15		$	0.20		$	0.27		$	0.23		$	0.85
WASO - Basic		67,310			67,453			67,054			67,059			67,219			66,793			65,806			63,999			62,213			64,703			61,003			59,941			59,481			59,307			59,937
WASO - Diluted		68,947			69,478			69,458			69,419			69,325			68,765			67,067			65,756			63,152			66,184			61,723			60,921			60,322			59,801			60,696
Net Sales by Segment:
Physician Business	$	284,438		$	300,813		$	329,159		$	313,109		$	1,227,520		$	306,245		$	320,171		$	326,520		$	355,749		$	1,308,685		$	331,386		$	341,761		$	357,269		$	326,966		$	1,357,382
Elder Care Business		128,696			126,246			129,261			129,915			514,118			132,664			137,759			138,688			137,995			547,106			140,406			149,485			161,874			142,743			594,509
		—			—			—			—			—			(0	)		—			—			—			—			423			356			2			19			800
	$	413,135		$	427,059		$	458,421		$	443,024		$	1,741,639		$	438,910		$	457,930		$	465,208		$	493,744		$	1,855,791		$	472,215		$	491,603		$	519,145		$	469,728		$	1,952,691
Billing Days:		64			63			62			64			253			64			63			62			64			253			64			63			66			60			253
Net Sales Per Billing Day:
Physician Business	$	4,444		$	4,775		$	5,309		$	4,892		$	4,852		$	4,785		$	5,082		$	5,266		$	5,559		$	5,173		$	5,178		$	5,425		$	5,413		$	5,449		$	5,365
Elder Care Business		2,011			2,004			2,085			2,030			2,032			2,073			2,187			2,237			2,156			2,162			2,194			2,373			2,453			2,379			2,350
		—			—			—			—			—			(0	)		—			—			—			—			7			6			—			—			3
	$	6,455		$	6,779		$	7,394		$	6,922		$	6,884		$	6,858		$	7,269		$	7,503		$	7,715		$	7,335		$	7,378		$	7,803		$	7,866		$	7,829		$	7,718

Numbers may not foot due to rounding differences

PSS World Medical, Inc.

As of October 2, 2009

Select^TM Net Sales

(in thousands)

	Fiscal 2005		Fiscal 2006		Fiscal 2007		Fiscal 2008		Fiscal 2009
Consolidated Select Sales	$	137,540	$	157,296	$	185,844	$	234,810	$	281,536

Numbers may not foot due to rounding differences

PSS World Medical, Inc.

Segment Information

As of October 2, 2009

(in thousands)

	Three Months Ended				Six Months Ended
	10/2/2009		9/26/2008		10/2/2009		9/26/2008
NET SALES:
Physician Business	398,531		341,761		740,823		673,147
Elder Care Business	162,970		149,485		313,351		289,891
Corporate Shared Services	475		356		1,357		779
Total net sales	561,976		491,603		1,055,530		963,817
BILLING DAYS:	68		63		132		127
NET SALES PER BILLING DAY:
Physician Business	5,861		5,425		5,612		5,300
Elder Care Business	2,397		2,373		2,374		2,283
Corporate Shared Services	7		6		10		6
Total net sales per billing day	8,264		7,803		7,996		7,589
INCOME FROM OPERATIONS:
Physician Business	42,546		26,164		71,264		48,373
Elder Care Business	11,631		8,399		18,755		13,853
Corporate Shared Services	(15,543	)	(10,157	)	(29,736	)	(19,789	)
Total income from operations	38,635		24,405		60,284		42,436
DEPRECIATION:
Physician Business	1,960		1,881		3,910		3,722
Elder Care Business	1,267		1,237		2,529		2,419
Corporate Shared Services	2,028		1,793		4,062		3,601
Total depreciation	5,256		4,912		10,501		9,742
AMORTIZATION OF INTANGIBLE AND OTHER ASSETS:
Physician Business	574		937		1,192		1,678
Elder Care Business	553		594		1,086		1,175
Corporate Shared Services	62		22		164		44
Total amortization of intangible and other assets	1,190		1,553		2,442		2,897
PROVISION FOR DOUBTFUL ACCOUNTS:
Physician Business	829		665		1,268		1,148
Elder Care Business	422		107		1,193		1,471
Total provision for doubtful accounts	1,250		772		2,461		2,620
INTEREST EXPENSE:
Total interest expense	4,532		5,300		8,793		8,503
INTEREST AND INVESTMENT INCOME:
Elder Care Business	(0	)	10		13		25
Corporate Shared Services	95		833		216		940
Total interest and investment income	95		842		229		964
PROVISION (BENEFIT) FOR INCOME TAXES:
Physician Business	15,459		9,117		26,085		17,676
Elder Care Business	3,564		2,327		5,529		3,704
Corporate Shared Services	(6,058	)	(3,340	)	(10,437	)	(7,090	)
Total provision for income taxes	12,964		8,104		21,177		14,291

Numbers may not foot due to rounding differences

PSS World Medical, Inc.

Current Fiscal Year Balance Sheet

(in thousands)

Consolidated

	As of
	6/26/09		10/2/09
ASSETS
Cash	$	129,631	$	130,089
Accounts receivable, net		230,391		257,968
Inventory, net		196,160		212,813
Prepaid expenses		5,190		4,262
Other current assets		27,445		32,194
Total current assets		588,817		637,326
Property and equipment, net		103,552		105,499
Goodwill		114,255		115,280
Intangibles, net		22,442		21,604
Other long-term assets		65,014		73,818
Total long-term assets		305,262		316,201
Total assets	$	894,131	$	953,528
LIABILITIES & EQUITY
Accounts payable	$	133,781	$	156,966
Accrued expenses		46,196		43,248
Revolving line of credit and current portion of long term debt		50,953		50,970
Other current liabilities		12,882		13,653
Total current liabilities		243,812		264,837
Long-term debt		182,654		184,530
Other non-current liabilities		70,323		79,896
Total long-term liabilities		252,977		264,427
Total liabilities		496,789		529,263
Total equity		397,342		424,265
Total liabilities & equity	$	894,131	$	953,528

Numbers may not foot due to rounding differences

PSS World Medical, Inc.

Balance Sheet Trend

(in thousands)

Consolidated

	Fiscal 2007				Fiscal 2008				Fiscal 2009
ASSETS	Jun-06	Sep-06	Dec-06	Mar-07	Jun-07	Sep-07	Dec-07	Mar-08	Jun-08	Sep-08	Dec-08	Mar-09
Cash	27,784	45,676	54,904	46,658	23,954	17,041	15,031	21,122	29,840	226,055	214,709	82,031
Investment in available for sale securities	—	—	—	—	—	—	—	—	—	—	—	10,592
Accounts receivable, net	206,405	225,538	219,822	222,776	222,699	232,282	224,282	237,248	227,661	240,806	232,894	230,361
Inventory, net	170,612	172,127	186,193	174,130	187,499	188,087	214,256	190,846	192,707	199,337	239,940	207,593
Deferred tax assets	11,181	9,042	2,128	8,776	8,987	9,319	9,175	8,183	6,805	—	—	8,059
Other current assets	32,876	39,289	37,330	34,436	34,347	27,894	31,658	48,744	26,157	22,163	23,229	23,819
Total current assets	448,857	491,672	500,376	486,776	477,486	474,623	494,403	506,142	483,170	688,361	710,772	562,456
Property and equipment, net	88,977	88,089	86,720	89,498	90,213	90,208	90,781	91,584	92,803	96,849	97,113	101,205
Goodwill	106,519	106,819	106,972	107,366	110,993	110,727	110,868	110,679	112,320	112,392	112,717	112,768
Intangibles, net	33,350	32,343	31,186	29,758	30,280	28,991	27,669	26,305	25,738	24,345	23,102	22,958
Investment in available for sale securities	—	—	—	—	24,232	46,147	50,206	11,318	14,231	16,725	15,333	—
Other long-term assets	54,444	54,455	57,631	59,898	69,481	67,195	67,921	67,209	67,598	83,055	70,549	59,238
Total long-term assets	283,291	281,706	282,509	286,521	325,198	343,268	347,446	307,094	312,690	333,365	318,815	296,169
Total assets	732,148	773,378	782,885	773,297	802,685	817,891	841,849	813,236	795,860	1,021,726	1,029,587	858,624

	Fiscal 2007				Fiscal 2008				Fiscal 2009
LIABILITIES & EQUITY	Jun-06	Sep-06	Dec-06	Mar-07	Jun-07	Sep-07	Dec-07	Mar-08	Jun-08	Sep-08	Dec-08	Mar-09
Accounts payable	122,449	145,767	162,338	131,330	144,572	149,827	161,728	135,930	128,656	149,674	155,133	127,300
Accrued expenses	27,748	34,827	31,670	37,224	33,190	33,275	34,350	46,056	38,055	50,816	43,170	52,718
Current maturities of long-term debt	517	1,655	138,334	2,238	2,132	32,129	33,660	214,732	196,116	198,022	199,606	50,937
Deferred tax liabilities, current	—	—	—	—	—	—	—	—	—	6,619	4,492	—
Other current liabilities	12,490	13,917	10,731	11,440	15,267	15,000	15,846	11,969	8,102	8,723	9,160	7,956
Total current liabilities	163,204	196,166	343,072	182,232	195,161	230,230	245,584	408,687	370,928	413,855	411,560	238,910
Long-term debt	134,053	135,358	460	138,318	139,657	141,091	143,020	725	706	177,650	179,395	180,965
Other long-term liabilities	60,689	63,702	62,457	63,922	70,413	68,190	69,976	64,473	68,975	64,763	56,503	60,719
Total long-term liabilities	194,742	199,060	62,917	202,240	210,070	209,282	212,996	65,198	69,682	242,413	235,899	241,685
Total liabilities	357,946	395,226	405,989	384,472	405,231	439,512	458,580	473,885	440,610	656,268	647,459	480,594
Total equity	374,202	378,152	376,896	388,824	397,454	378,379	383,269	339,351	355,250	365,458	382,127	378,030
Total liabilities & equity	732,148	773,378	782,885	773,297	802,685	817,891	841,849	813,236	795,860	1,021,726	1,029,587	858,624

Numbers may not foot due to rounding differences

PSS World Medical, Inc.

Unaudited Operating Highlights

Current Fiscal Year

(in millions)

	Three Months Ended						Six Months Ended
	Oct. 2, 2009			Sept. 26, 2008			Oct. 2, 2009			Sept. 26, 2008
Net sales:
Physician Business	$	398.5		$	341.8		$	740.8		$	673.1
Elder Care Business		163.0			149.5			313.4			289.9
Corporate Shared Services		0.5			0.4			1.4			—
Total net sales	$	562.0		$	491.6		$	1,055.5		$	963.0
Income from operations:
Physician Business	$	42.5		$	26.2		$	71.3		$	48.4
Elder Care Business		11.6			8.4			18.8			13.9
Corporate Shared Services		(15.5	)		(10.2	)		(29.7	)		(19.8	)
Total income from operations	$	38.6		$	24.4		$	60.3		$	42.4
EBITDA (a)	$	32.1		$	31.4		$	77.7		$	56.2
Income from operations, as a percentage of net sales		6.9	%		5.0	%		5.7	%		4.4	%
Consolidated Return on Committed Capital (“ROCC”) (b)		42.5	%		27.8	%		34.2	%		24.0	%
Billing Days		68			63			132			127
Net Sales Per Billing Day (in thousands):
Physician Business	$	5,861		$	5,425		$	5,612		$	5,300
Elder Care Business		2,397			2,373			2,374			2,283
Corporate Shared Services		7			6			10			—
Total Net Sales Per Billing Day	$	8,264		$	7,803		$	7,996		$	7,583
Net Sales Per Billing Day Growth Rate:
Physician Business		8.0	%					5.9	%
Elder Care Business		1.0	%					4.0	%
Total Net Sales Per Billing Day Growth Rate		5.9	%					5.5	%
							Annualized
							Oct. 2, 2009			Sept. 26, 2008
DSO (c)
Physician Business								38.9			40.8
Elder Care Business								49.0			50.1
DOH (d)
Physician Business								54.0			52.2
Elder Care Business								51.3			52.8
DIP (e)
Physician Business								40.4			40.7
Elder Care Business								22.8			28.1
Cash Conversion Days (f)
Physician Business								52.5			52.2
Elder Care Business								77.6			74.8
							As of
							Oct. 2, 2009			Sept. 26, 2008
Operational working capital (g)							$	313.8		$	290.5
Net debt:
Bank debt							$	50.0		$	50.0
Other debt							$	2.3		$	3.4
Convertible senior notes							$	183.2		$	322.4
Less: Cash and cash equivalents							$	(130.1	)	$	(226.1	)
Net debt							$	105.4		$	149.7

Numbers may not foot due to rounding differences

PSS WORLD MEDICAL, INC.

Non GAAP Reconciliations

Net income impact of swine flu related product sales

(in millions, except per share data)

	Three Months Ended			Diluted EPS		Six Months Ended			Diluted EPS
	Oct. 2, 2009					Oct. 2, 2009
Net income	$	21.7		$	0.37	$	35.0		$	0.59
Less: Impact on pre-tax income from swine flu related product sales		(2.9	)				(4.5	)
Tax impact on swine flu related product sales		1.1					1.7
Net income adjusted for swine flu related product sales	$	19.9		$	0.33	$	32.2		$	0.54

Net income impact of ASC 470-20 (Formerly FSP APB 14-1)

(in millions, except per share data)

	Three Months Ended			Diluted EPS		Three Months Ended			Diluted EPS
	Oct. 2, 2009					Sept. 26, 2008
Net Income	$	21.7		$	0.37	$	12.4		$	0.20
Add Back: Impact of ASC 470-20		1.9					2.5
Tax impact on ASC 470-20		(0.7	)				(0.9	)
Net income adjusted for the impact of ACS 470-20	$	22.9		$	0.39	$	13.9		$	0.23
	Six Months Ended			Diluted EPS		Six Months Ended			Diluted EPS
	Oct. 2, 2009					Sept. 26, 2008
Net Income	$	35.0		$	0.59	$	21.7		$	0.35
Add Back: Impact of ASC 470-20		3.7					4.0
Tax impact on ASC 470-20		(1.4	)				(1.5	)
Net income adjusted for the impact of ACS 470-20	$	37.3		$	0.63	$	24.2		$	0.39

Numbers may not foot due to rounding differences

PSS WORLD MEDICAL, INC.

Non GAAP Reconciliations

Average daily net income percent change

(in millions)

	For the Three Months Ended
	October 2, 2009		September 26, 2008		Average Daily Net Income
	Net Income	Average Daily Net Income	Net Income	Average Daily Net Income
					Percent Change
Total Company	21.7	0.3	12.4	0.2	62.5	%

Physician Business daily net sales impact from swine flu related product sales

(in millions)

	For the Three Months Ended
	October 2, 2009				September 26, 2008		Average Daily Net Sales
	Net Sales		Average Daily Net Sales		Net Sales	Average Daily Net Sales
							Percent Change
Physician Business	398.5		5.9		341.8	5.4	8.0	%
Less: Impact of swine flu related product sales	(23.2	)	(0.4	)	—	—	N/A
Physician Business adjusted for swine flu related product sales	375.3		5.5		341.8	5.4	1.8	%

Numbers may not foot due to rounding differences

PSS World Medical, Inc.

Selling Days Calendar FY09-FY11

FY2009		FY2010		FY2011		Notes
Closing Date	Selling Days	Closing Date	Selling Days	Closing Date	Selling Days
Apr-06	20	Apr-08	20	Apr-10	20	A
May-06	24	May-08	24	May-10	20	A
Jun-06	20	Jun-08	20	Jul-10	24	B
	64		64		64
Jul-06	19	Jul-08	24	Jul-10	19	A
Aug-06	25	Aug-08	20	Aug-10	20	A
Sep-08	19	Oct-08	24	Oct-10	24	B
	63		68		63
Oct-06	25	Oct-08	20	Oct-10	20	A
Nov-06	18	Nov-08	18	Nov-10	18	A
Jan-06	23	Jan-08	23	Dec-10	23	B
	66		61		61
Jan-06	20	Jan-08	20	Jan-11	20	A
Feb-06	20	Feb-08	20	Feb-11	20	A
Mar-09	20	Apr-08	25	Apr-11	25	B
	60		65		65
	253		258		253

A Closing date is the last Friday of the month (for non-quarter end months).

B “Selling Days” defines closing date as the Friday closest to month end based on business days only (for quarter end months only).

Numbers may not foot due to rounding differences

PSS World Medical, Inc.

EBITDA Calculation

Current Fiscal Year

(in thousands)

	Fiscal 2010
	Q1			Q2
Net Income	$	13,304		$	21,686
Plus: Interest expense		4,261			4,532
Less: Interest and investment income		(134	)		(95	)
Plus: Provision for income taxes		8,213			12,964
Plus: Depreciation		5,245			5,256
Plus: Amortization of intangible assets		1,252			1,190
EBITDA	$	32,140		$	45,533

Numbers may not foot due to rounding differences

PSS World Medical, Inc.

EBITDA Calculation

(in thousands)

	Fiscal 2007															Fiscal 2008															Fiscal 2009
	Q1			Q2			Q3			Q4			Total FY 2007			Q1			Q2			Q3			Q4			Total FY 2008			Q1			Q2			Q3			Q4			Total FY 2009
Net income	$	10,139		$	11,951		$	10,282		$	14,777		$	47,148		$	7,792		$	13,578		$	13,249		$	18,515		$	53,133		$	9,372		$	12,363		$	15,989		$	13,763		$	51,486
Plus: Interest expense		2,691			2,635			2,642			2,631			10,597			2,764			2,956			3,247			3,529			12,495			3,203			5,300			7,409			6,247			22,159
Less: Interest and investment income		(98	)		(282	)		(426	)		(385	)		(1,191	)		(528	)		(114	)		(26	)		(23	)		(691	)		(122	)		(842	)		(1,034	)		(305	)		(2,304	)
Plus: Provision for income taxes		6,449			7,681			5,862			7,824			27,817			5,010			8,551			8,441			12,597			34,599			6,187			8,104			10,230			7,709			32,229
Plus: Depreciation		4,107			4,170			4,242			4,304			16,823			4,632			4,796			4,710			4,719			18,858			4,830			4,912			5,116			5,144			20,002
Plus: Amortization of intangible assets		1,500			1,477			1,469			1,462			5,908			1,458			1,406			1,362			1,360			5,586			1,344			1,553			1,264			1,328			5,489
EBITDA	$	24,786		$	27,632		$	24,070		$	30,613		$	107,101		$	21,128		$	31,172		$	30,983		$	40,697		$	123,980		$	24,813		$	31,390		$	38,973		$	33,886		$	129,062

Numbers may not foot due to rounding differences

PSS World Medical, Inc.

Return on Committed Capital (ROCC)

Current Fiscal Year

(in thousands)

Consolidated

	Fiscal 2010
	Q1			Q2
Quarterly Average Committed Capital (1)	$	378,397		$	378,706
Committed Capital - Current Quarter		364,619			392,792
Committed Capital - Previous Quarter		392,174			364,619
Committed Capital - Previous Year End
Return on Committed Capital - Quarterly (2)		28.4	%		42.5	%
Return:
Net income		13,304			21,686
Add:
Provision for income taxes		8,213			12,964
Interest expense		4,261			4,532
Amortization		1,252			1,190
Interest and investment income		(134	)		(95	)
	$	26,895		$	40,277
Committed Capital:
Total assets	$	894,131		$	953,528
Less assets excluded:
Cash		(129,631	)		(130,089	)
Goodwill and intangibles, net		(136,696	)		(136,884	)
Total liabilities		(496,792	)		(529,263	)
Plus liabilities excluded:
Current debt		50,953			50,970
Long-term debt		182,654			184,530
	$	364,619		$	392,792

(1) Quarterly Average Committed Capital equals the sum of the committed capital of the most recent two quarters, divided by two.

(2) Return on Committed Capital equals Return divided by Committed Capital. Quarterly calculations are annualized.

Numbers may not foot due to rounding differences

PSS World Medical, Inc.

Return on Committed Capital (ROCC)

(in thousands)

Consolidated

	Fiscal 2007										Fiscal 2008										Fiscal 2009
	Q1		Q2		Q3		Q4		Total FY 2007		Q1		Q2		Q3		Q4		Total FY 2008		Q1		Q2		Q3		Q4		Total FY 2009
Quarterly Average Committed Capital (1)	332,763		334,894		326,477		334,112				359,807		384,428		400,611		401,541				390,439		381,257		394,469		401,387
Annual Average Committed Capital (2)									335,832										371,150										394,438
Committed Capital - Current Quarter	339,461		330,327		322,628		345,597				374,016		394,840		406,381		396,702				384,175		378,339		410,600		392,174
Committed Capital - Previous Quarter	326,066		339,461		330,327		322,628				345,597		374,016		394,840		406,381				396,702		384,175		378,339		410,600
Committed Capital - Current Year End									345,597										396,702										392,174
Committed Capital - Previous Year End									326,066										345,597										396,702
Return on Committed Capital - Quarterly (3)	24.9	%	28.0	%	24.3	%	31.5	%	27.9	%	18.3	%	27.4	%	26.2	%	35.8	%	27.9	%	20.5	%	27.8	%	34.3	%	28.6	%	27.9	%
Return on Committed Capital - Annual
Return:
Income from continuing operations before extraordinary loss	10,139		11,951		10,282		14,777		12,911		7,792		13,578		13,249		18,515		12,911		9,372		12,363		15,989		13,763		12,911
Add:
Provision for income taxes	6,449		7,681		5,862		7,824		6,957		5,010		8,551		8,441		12,597		6,957		6,187		8,104		10,230		7,709		6,957
Interest expense	2,688		2,635		2,642		2,631		1,467		2,764		2,956		3,247		3,529		1,467		3,203		5,300		7,409		6,247		1,467
Amortization	1,500		1,477		1,469		1,462		1,871		1,458		1,406		1,362		1,360		1,871		1,344		1,553		1,264		1,328		1,871
Interest and investment income	(98	)	(282	)	(426	)	(385	)	(149	)	(528	)	(114	)	(26	)	(23	)	(149	)	(122	)	(842	)	(1,034	)	(305	)	(149	)
	20,677		23,462		19,828		26,309		23,057		16,496		26,377		26,273		35,978		23,057		19,983		26,478		33,856		28,742		23,057
Committed Capital:
Total assets	732,148		773,377		782,885		773,297		773,297		802,685		817,891		841,849		813,236		813,236		795,860		1,021,726		1,029,586		858,624		858,624
Less assets excluded:
Cash	(27,784	)	(45,676	)	(54,904	)	(46,658	)	(46,658	)	(23,954	)	(17,041	)	(15,031	)	(21,122	)	(21,122	)	(29,840	)	(226,055	)	(214,709	)	(82,031	)	(82,031	)
Goodwill and intangibles, net	(139,869	)	(139,162	)	(138,158	)	(137,124	)	(137,124	)	(141,273	)	(139,718	)	(138,537	)	(136,984	)	(136,984	)	(138,058	)	(136,736	)	(135,820	)	(135,726	)	(135,726	)
DTA from sale of imaging business	(1,658	)	(0	)	(0	)	(0	)	(0	)	(0	)	(0	)	(0	)	(0	)	(0	)	(0	)	(0	)	(0	)	(0	)	(0	)
Total liabilities	(357,946	)	(395,226	)	(405,989	)	(384,472	)	(384,472	)	(405,231	)	(439,512	)	(458,580	)	(473,885	)	(473,885	)	(440,610	)	(656,268	)	(647,459	)	(480,594	)	(480,594	)
Plus liabilities excluded:
Current debt	517		1,655		138,334		2,238		2,238		2,132		32,129		33,660		214,732		214,732		196,116		198,022		199,606		50,937		50,937
Long-term debt	134,053		135,358		460		138,318		138,318		139,657		141,091		143,020		725		725		706		177,650		179,395		180,965		180,965
	339,461		330,327		322,628		345,597		345,597		374,016		394,840		406,381		396,702		396,702		384,175		378,339		410,600		392,174		392,174

(1) Quarterly Average Committed Capital equals the sum of the committed capital of the most recent two quarters, divided by two.

(2) Annual Average Committed Capital equals the sum of the committed capital of the most recent two year ends, divided by two.

(3) Return on Committed Capital equals return divided by Committed Capital. Quarterly calculations are annualized.

Numbers may not foot due to rounding differences

PSS WORLD MEDICAL, INC.

Footnotes

(a) EBITDA represents net income plus provision for income taxes, interest expense, depreciation, and amortization of intangible assets, less interest and investment income. Management review EBITDA when evaluating and comparing the performance of each operating segment on a quarterly basis. Management believes EBITDA is an important measure of liquidity.

(b) ROCC equals return divided by average committed capital. Return is annualized for quarterly and year to date calculations. Management review ROCC when evaluating and comparing the performance of each operating segment on a quarterly basis. Management believes ROCC is an important measure of profitability and return.

(c) DSO is average accounts receivable divided by average daily net sales. Average accounts receivable is the sum of accounts receivable, net of the allowance for doubtful accounts, at the beginning and end of the most recent four quarters divided by five. Average daily net sales are net sales for the most recent four quarters divided by 360.

(d) DOH is average inventory divided by average daily cost of goods sold (“COGS”). Average inventory is the sum of inventory at the beginning and end of the most recent four quarters divided by five. Average daily COGS is quarterly COGS for the most recent four quarters divided by 360.

(e) DIP is average accounts payable divided by average daily COGS. Average accounts payable is the sum of accounts payable at the beginning and end of the most recent four quarters divided by five.

(f) Cash Conversion Days is the sum of DSO and DOH less DIP.

(g) Operational working capital equals accounts receivable plus inventory minus accounts payable.

(h) “Swine flu related product sales” represents increased sales in influenza test kits, surgical masks, medical gloves, hand sanitizers and other products related to the swine flu pandemic.