Segments of Business (Tables)

12 Months Ended

Mar. 31, 2018

Financial information relating to our reportable segments and reconciliations to the consolidated totals is as follows:



	Years Ended March 31,
(In millions)	2018			2017			2016
Revenues
Distribution Solutions ⁽¹⁾
North America pharmaceutical distribution and services	$	174,186		$	164,832		$	158,469
International pharmaceutical distribution and services	27,320			24,847			23,497
Medical-Surgical distribution and services	6,611			6,244			6,033
Total Distribution Solutions	208,117			195,923			187,999

Technology Solutions - products and services	240			2,610			2,885
Total Revenues	$	208,357		$	198,533		$	190,884

Operating profit
Distribution Solutions ^{(2) (3)}	$	1,231		$	3,361		$	3,553
Technology Solutions ⁽⁴⁾	(23		)	$	4,215		$	519
Total	1,208			7,576			4,072
Corporate Expenses, Net ⁽⁵⁾	(564		)	$	(377	)	$	(469	)
Loss on Debt Extinguishment	(122		)	—			$	—
Interest Expense	(283		)	$	(308	)	$	(353	)
Income From Continuing Operations Before Income Taxes	$	239		$	6,891		$	3,250

Depreciation and amortization ⁽⁶⁾
Distribution Solutions	$	831		$	735		$	669
Technology Solutions	9			65			107
Corporate	111			110			109
Total	$	951		$	910		$	885

Expenditures for long-lived assets ⁽⁷⁾
Distribution Solutions	$	306		$	276		$	306
Technology Solutions	—			30			15
Corporate	99			98			167
Total	$	405		$	404		$	488

Revenues, net by geographic area ⁽⁸⁾
United States	$	169,943		$	164,428		$	158,255
Foreign	38,414			34,105			32,629
Total	$	208,357		$	198,533		$	190,884


(1)	Revenues derived from services represent less than 2% of this segment’s total revenues.

(2)

Distribution Solutions segment’s operating profit for 2018 includes non-cash pre-tax goodwill impairment charges of $1,283 million for our McKesson Europe reporting unit and $455 million for our Rexall Health reporting unit. This segment’s operating profit for 2018 also includes non-cash pre-tax asset impairment charges of $446 million and pre-tax restructuring charges of $74 million for our McKesson Europe business. Operating profit for 2017 and 2016 includes $144 million and $76 million of net cash proceeds representing our share of net settlements of antitrust class action lawsuits, and for 2016 also includes a pre-tax gain of $52 million recognized from the sale of our ZEE Medical business.

(3)

Distribution Solutions segment’s operating profit for 2018 and 2017 includes pre-tax credits of $99 million and $7 million and for 2016 a pre-tax charge of $244 million related to our LIFO method of accounting for inventories. LIFO credits were higher in 2018 compared to 2017 due to higher net effect of price declines, partially offset by lower inventory level. LIFO expense was recognized in 2016 primarily due to net effects of price increases.

(4)

Technology Solutions segment’s operating profit for 2018 includes a pre-tax gain of $109 million from the 2018 third quarter sale of our EIS business. Operating profit for 2017 includes a pre-tax gain of $3,947 million recognized from the Healthcare Technology Net Asset Exchange, net of transaction and related expenses and a non-cash pre-tax charge of $290 million for goodwill impairment related to the EIS reporting unit. Operating profit for 2016 includes a pre-tax gain of $51 million recognized from the sale of our nurse triage business.


(5)	In 2016, the Company implemented the Cost Alignment Plan to reduce its operating expenses and recorded pre-tax restructuring charges of $229 million. Pre-tax charges for 2016 were recorded as follows: $161 million, $51 million and $17 million within our Distribution Solutions segment, Technology Solutions segment and Corporate.


(6)	Amounts primarily include amortization of acquired intangible assets purchased in connection with business acquisitions, capitalized software held for sale and capitalized software for internal use.


(7)	Long-lived assets consist of property, plant and equipment.


(8)	Net revenues were attributed to geographic areas based on the customers’ shipment locations.

Schedule of segment assets and property, plant and equipment, net by geographic areas

Segment assets and property, plant and equipment, net by geographic areas were as follows:



	March 31,
(In millions)	2018		2017
Segment assets
Distribution Solutions	$	53,915	$	52,322
Technology Solutions	3,735		4,995
Corporate	2,731		3,652
Total	$	60,381	$	60,969

Property, plant and equipment, net
United States	$	1,529	$	1,383
Foreign	935		909
Total	$	2,464	$	2,292