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CareFusion Corp. (CFN) said Tuesday its fiscal fourth-quarter earnings fell 46% on a host of charges and announced restructuring moves that will trim nearly 5% of the work force while targeting more than $100 million in annual savings.

Company officials said the maker of drug-delivery systems and infection-prevention tools had a better first year than they expected during the spin-off last August from Cardinal Health Corp. (CAH). But the restructuring moves, which will involve shedding about 700 positions, build on previous comments that the post-spin-off CareFusion needed to address its operating margins to better compare with peers, Chairman and Chief Executive David Schlotterbeck said.

"These actions will provide a solid base and allow us to gain efficiencies as we grow our business," he said on a conference call with analysts.

The company said the job cuts involve shedding management layers and also affect "support functions." It anticipates $85 million to $95 million in pre-tax savings in the recently started fiscal year, with savings rising another $25 million the following year. It expects restructuring efforts to trigger non-recurring costs of $40 million to $50 million this year.

Shares of the San Diego-based company moved up 3.5% to $22.15 in after-hours trading after slipping 1.5% during Tuesday's regular trading hours. The shares have traded down 14% on the year.

Schlotterbeck also noted that CareFusion will continue to analyze its portfolio and expects to make decisions during the new fiscal year to divest certain operations that aren't a good fit or dilute operating margins. It's too soon to say what businesses could be cut, but there are "clear opportunities" to redeploy capital, he said.

Another priority in the new year is to aggressively pursue drug-infusion pump business as competitor Baxter International Inc. (BAX) works through a two-year effort to pull about 200,000 of its "Colleague" brand pumps from the U.S. market. Baxter is offering replacement devices or refunds following years of product issues.

Schlotterbeck indicated CareFusion will use low prices to attract customers, which he said could hurt margins in the near term but pay off down the road. Hospira Inc. (HSP) is another major player in the market for these pumps, which are ubiquitous devices used in hospitals to deliver fluid and drugs intravenously.

"By converting share now we will benefit for an extended period into the future through our disposals business," Schlotterbeck said. He said it was premature to estimate how much Baxter business CareFusion will take.

For the quarter ended June 30, CareFusion reported a profit of $52 million, or 23 cents a share, down from $96 million, or 44 cents a share, a year earlier. Excluding spinoff and other charges, earnings from continuing operations were 38 cents a share in the recent quarter. Revenue jumped 19% to $1.04 billion.

Analysts polled by Thomson Reuters had most recently forecast earnings of 37 cents a share on $1.02 billion in revenue for the recent quarter.

Gross margin rose to 46.9% from 46.4%.

Looking ahead, CareFusion projected earnings for the new fiscal year of $1.58 to $1.68 a share on a mid-single-digit sales gains on a percentage basis. Analysts anticipated earnings of $1.62 a share and revenue rising 6% to $4.13 billion.

-By Jon Kamp, Dow Jones Newswires; 617-654-6728; jon.kamp@dowjones.com

(Nathan Becker and Kevin Kingsbury contributed to this report.)

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