filings.toolsItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities.
10K characters. Original on sec.gov ·
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities.
Market Information: The principal market on which our common stock is traded is the New York Stock Exchange (“NYSE”) under the trading symbol “MCK.”
Holders: At March 31, 2023, there were 4,425 holders of record of our common stock.
Dividends: In July 2022, our quarterly dividend was raised from $0.47 to $0.54 per common share for dividends declared on or after such date by the Board. We declared regular cash dividends of $2.09, $1.83, and $1.67 per share for the years ended March 31, 2023, 2022, and 2021, respectively.
We anticipate that we will continue to pay quarterly cash dividends in the future. However, the payment and amount of future dividends remain within the discretion of the Board and will depend upon our future earnings, financial condition, capital requirements, and other factors.
Securities Authorized for Issuance under Equity Compensation Plans: Information relating to this item is provided under Item 12 of Part III included in this Annual Report.
Share Repurchase Plans: The Board has authorized the repurchase of McKesson’s common stock. Stock repurchases may be made from time-to-time in open market transactions, privately negotiated transactions, through accelerated share repurchase (“ASR”) programs, or by combinations of such methods, any of which may use pre-arranged trading plans that are designed to meet the requirements of Rule 10b5-1(c) of the Securities Exchange Act of 1934, as amended. The timing of any repurchases and the actual number of shares repurchased will depend on a variety of factors, including the Company’s stock price, corporate and regulatory requirements, tax implications, restrictions under the Company’s debt obligations, and other market and economic conditions. During the last three fiscal years, our share repurchases were transacted through both open market transactions and ASR programs with third-party financial institutions. The ASR programs discussed below were designed to comply with Rule 10b5-1(c).
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McKESSON CORPORATION
The following table provides information on our share repurchases for the last three fiscal years:
| Share Repurchases (1) | ||||||||||||||||||||
| (In millions, except price per share) | Total Number of Shares Purchased (2) | Average Price Paid Per Share | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Programs | |||||||||||||||||
| Balance, March 31, 2020 | $ | 1,535 | ||||||||||||||||||
| Share repurchase authorization increase in fiscal 2021 | 2,000 | |||||||||||||||||||
| Shares repurchased - Open market (3) | 4.7 | $ | 160.33 | (750) | ||||||||||||||||
| Balance, March 31, 2021 | 2,785 | |||||||||||||||||||
| Shares repurchased - May 2021 ASR | 5.2 | $ | 193.22 | (1,000) | ||||||||||||||||
| Shares repurchased - Open market | 4.6 | $ | 217.73 | (1,007) | ||||||||||||||||
| Share repurchase authorization increase in fiscal 2022 | 4,000 | |||||||||||||||||||
| Shares repurchased - February 2022 ASR (4) | 4.8 | $ | 265.56 | (1,500) | ||||||||||||||||
| Balance, March 31, 2022 | 3,278 | |||||||||||||||||||
| Shares repurchased - February 2022 ASR (4) | 0.3 | $ | 295.16 | — | ||||||||||||||||
| Shares repurchased - May 2022 ASR | 3.1 | $ | 321.05 | (1,000) | ||||||||||||||||
| Share repurchase authorization increase in fiscal 2023 | 4,000 | |||||||||||||||||||
| Shares repurchased - December 2022 ASR | 2.6 | $ | 369.20 | (972) | ||||||||||||||||
| Shares repurchased - Open market (5) | 4.7 | $ | 363.24 | (1,693) | ||||||||||||||||
| Balance, March 31, 2023 | $ | 3,613 |
(1)This table does not include the value of equity awards surrendered to satisfy tax withholding obligations or forfeitures of equity awards.
(2)The number of shares purchased reflects rounding adjustments.
(3)Of the total dollar value, $8 million was accrued within “Other accrued liabilities” in our Consolidated Balance Sheet as of March 31, 2021, included in our Annual Report on Form 10-K for the year ended March 31, 2022, for share repurchases that were executed in late March 2021 and settled in early April 2021.
(4)In February 2022, we entered into an ASR program with a third-party financial institution to repurchase $1.5 billion of the Company’s common stock. The total number of shares repurchased under this ASR program was 5.1 million shares at an average price per share of $295.16. We received 4.8 million shares as the initial share settlement in the fourth quarter of fiscal 2022 based on an initial share purchase price, and in May 2022, we received an additional 0.3 million shares upon the completion of this ASR program.
(5)Of the total dollar value, $27 million was accrued within “Other accrued liabilities” in our Consolidated Balance Sheet as of March 31, 2023 for share repurchases that were executed in late March 2023 and settled in early April 2023.
The following table provides information on our share repurchases during the fourth quarter of fiscal 2023:
| Share Repurchases (1) | |||||||||||||||||||||||
| (In millions, except price per share) | Total Number of Shares Purchased | Average Price Paid per Share (2) | Total Number of Shares Purchased as Part of Publicly Announced Programs (3) | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Programs | |||||||||||||||||||
| January 1, 2023 - January 31, 2023 | — | $ | — | — | $ | 3,778 | |||||||||||||||||
| February 1, 2023 - February 28, 2023 | 0.4 | 369.20 | 0.4 | 3,778 | |||||||||||||||||||
| March 1, 2023 - March 31, 2023 | 0.5 | 347.09 | 0.5 | 3,613 | |||||||||||||||||||
| Total | 0.9 | 0.9 |
(1)This table does not include the value of equity awards surrendered to satisfy tax withholding obligations or forfeitures of equity awards.
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McKESSON CORPORATION
(2)In December 2022, we entered into an ASR program with a third-party financial institution to repurchase $972 million of the Company’s common stock. The total number of shares repurchased under this ASR program was 2.6 million shares at an average price per share of $369.20. We received 2.2 million shares as the initial share settlement in the third quarter of fiscal 2023, and in February 2023, we received an additional 0.4 million shares upon the completion of this ASR program.
(3)In July 2022, the Board authorized the Company to repurchase up to an additional $4.0 billion of its common shares in a manner deemed in the best interest of the Company and its stockholders, considering other growth opportunities and prevailing business and market conditions. The authorization has no expiration date.
Stock Price Performance Graph*: The following graph compares the cumulative total stockholder return on our common stock for the periods indicated with the Standard & Poor’s (“S&P”) 500 Index and the S&P 500 Health Care Index. The S&P 500 Health Care Index was selected as a comparator because it is generally available to investors and broadly used by other companies in the same industry.
| March 31, | |||||||||||||||||||||||||||||||||||
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | ||||||||||||||||||||||||||||||
| McKesson Corporation | $ | 100.00 | $ | 84.06 | $ | 98.27 | $ | 143.15 | $ | 226.57 | $ | 265.05 | |||||||||||||||||||||||
| S&P 500 Index | $ | 100.00 | $ | 109.50 | $ | 101.86 | $ | 159.25 | $ | 184.17 | $ | 169.94 | |||||||||||||||||||||||
| S&P 500 Health Care Index | $ | 100.00 | $ | 114.89 | $ | 113.73 | $ | 152.44 | $ | 181.55 | $ | 174.83 |
- Assumes $100 invested in McKesson Common Stock and in each index on March 31, 2018 and that all dividends are reinvested.
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