Cardinal notes increases in net earnings and sales

Drug Store News, Feb 20, 1989

Cardinal notes increases in net earnings and sales

DUBLIN, Ohio - Cardinal Distribution's net earnings from continuing operations rose 58 percent in the third quarter ended Dec. 31. Net sales for drug operations increased 36 percent in the quarter, to $182.8 million, the largest quarterly improvement in sales from ongoing operations the company's history.

Third-quarter net earnings from drug distribution operations were $2.2 million, or 32 cents per share fully diluted, against $1.4 million, or 23 cents per share fully diluted, in the comparable year-ago period. Income from discontinued food operations accounted for $160,000 in additional earnings in last year's quarter, for a total of $1.5 million, or 25 cents per share fully diluted.

For the nine months, sales from continuing operations rose 34 percent, to $502.2 million. Net earnings from continuing operations was $5.5 million, or 84 cents per share fully diluted, compard with $3.02 million, or 56 cents per share fully diluted, in the like period last year.

Cardinal's sale of its food operations in first-quarter '89, and related earnings, contributed 56 cents per share fully diluted, so that total earnings for the nine-month period was $10.2 million, or $1.40 per share fully diluted, versus $3.95 million, or 68 cents per share, for the prior-year period.

Robert D. Walter, Cardinal chairman and ceo, said retail sales growth was 33 percent, while hospital pharmaceutical sales grew 46 percent, helped by sales to hospital pharmacies in member hospitals associated with the VHA Supply Co. As previously reported, Cardinal won a contract to serve VHA member hospitals in the Northeast in September and began shipping merchandise in November. The current annual sales rate under the VHA contract is $70 million, with significant additional potential, Walter said.