McKesson (MCK) beat fiscal third-quarter targets, saying margins expanded.

For the quarter ended Dec. 31, the San Francisco-based drug distributor made $240 million, or 79 cents a share, from continuing operations, up from the year-ago $204 million, or 64 cents a share. Revenue rose 4% from a year ago to $23.11 billion.

Analysts surveyed by Thomson Financial were looking for a 68-cent profit on sales of $23.53 billion.

"Our Pharmaceutical Solutions operating profit margin expanded by 10 basis points and by 27 basis points when you adjust for a $37 million pre-tax gain from an anti-trust settlement in the third quarter a year ago," McKesson said. "Our significant margin expansion stems from the team's focus on continually providing more higher-margin products and services to our customers and leveraging our scale."

The company said it expects to earn 70 to 80 cents a share for the fourth quarter, in line with the 79-cent Thomson Financial target.

Shares were halted late Thursday after rising 20 cents in regular trading to $55.37.

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