Supplemental information

3 Months Ended

Nov. 30, 2022

Supplemental Cash Flow Elements [Abstract]

Supplemental information

Supplemental information

Accounts receivable

Accounts receivable are stated net of allowances for doubtful accounts. Accounts receivable balances primarily consist of trade receivables due from customers, including amounts due from third party payors (e.g., pharmacy benefit managers, insurance companies and governmental agencies). Trade receivables were $3.7 billion and $4.0 billion at November 30, 2022 and August 31, 2022, respectively. Other accounts receivable balances, which consist primarily of receivables from vendors and manufacturers, including receivables from AmerisourceBergen, were $1.2 billion and $1.1 billion at November 30, 2022 and August 31, 2022, respectively. See Note 16. Related parties for further information.

Depreciation and amortization

The Company has recorded the following depreciation and amortization expense in the Consolidated Condensed Statements of Earnings (in millions):

	Three months ended November 30,
	2022		2021
Depreciation expense	$	336	$	335
Intangible assets amortization	159		165
Total depreciation and amortization expense	$	495	$	500

Accumulated depreciation and amortization on property, plant and equipment was $12.9 billion at November 30, 2022 and $12.8 billion at August 31, 2022.

Restricted cash

The Company is required to maintain cash deposits with certain banks which consist of deposits restricted under contractual agency agreements and cash restricted by law and other obligations. The following represents a reconciliation of Cash and cash equivalents in the Consolidated Condensed Balance Sheets to total Cash, cash equivalents, marketable securities and restricted cash in the Consolidated Condensed Statements of Cash Flows as of November 30, 2022 and August 31, 2022, respectively (in millions):

	November 30, 2022		August 31, 2022
Cash and cash equivalents	$	2,349	$	1,358
Marketable securities	1,883		1,114
Restricted cash - (included in other current assets)	82		86
Cash, cash equivalents, marketable securities and restricted cash	$	4,314	$	2,558

Redeemable non-controlling interest

The following represents a roll forward of the redeemable non-controlling interest in the Consolidated Condensed Balance Sheets (in millions):

	Three months ended November 30,
	2022		2021
Opening balance	$	1,042	$	319
Acquisition of non-controlling interests 1	—		2,489
Net loss attributable to Redeemable non-controlling interests	(22)		(21)
Redemption price adjustments 2	440		7
Reclassifications to Accrued expenses and other liabilities 3	(1,314)		—
Other	12		(8)
Ending balance	$	157	$	2,787

1.The three months ended November 30, 2021 includes $1.9 billion of redeemable non-controlling interest representing the maximum purchase price to redeem non-controlling units in VillageMD for cash. On November 24, 2021, VillageMD commenced a tender offer to purchase up to $1.9 billion of units in VillageMD for cash. As of November 24, 2021, the Company recorded the $1.9 billion as redeemable non-controlling interest. The tender offer was fully subscribed and settled on December 28, 2021. The tender offer was funded by cash proceeds provided to VillageMD pursuant to the Unit Purchase Agreement.

2.Remeasurement of non-controlling interests, probable of redemption but not currently redeemable, to their redemption value, is recorded to Paid in capital in the Consolidated Condensed Balance Sheets. During the three months ended November 30, 2022, the Company announced the acceleration of its plans for full ownership of Shields and CareCentrix. The Shields and CareCentrix redeemable non-controlling interests were recorded to redemption value.

3.Represents the reclassification of the Shields and CareCentrix redeemable non-controlling interests resulting from acceleration of the Company's plans for full ownership of Shields and CareCentrix.

See Note 2. Acquisitions and other investments for further information.

Earnings per share

The dilutive effect of outstanding stock options on earnings per share is calculated using the treasury stock method. Stock options are anti-dilutive and excluded from the earnings per share calculation if the exercise price exceeds the average market price of the common shares. During the three months ended November 30, 2022 and November 30, 2021 there were 19.3 million and 16.1 million weighted outstanding options, respectively, to purchase common shares that were anti-dilutive and excluded from the earnings per share calculation.

Due to the anti-dilutive effect resulting from the reported net loss, an incremental 2.6 million of potentially dilutive securities were omitted from the calculation of weighted-average common shares outstanding for the three months ended November 30, 2022.

Cash dividends declared per common share

Cash dividends per common share declared were as follows:

Quarter ended	2022		2021
November	$	0.4800	$	0.4775