Glove maker takes $12 million charge over latex litigation

By Liz White, ERJ staff

Dublin, Ohio-Medical glove supplier Cardinal Health Inc. has paid $12 million related to a natural rubber latex lawsuit in the last quarter and said, "Litigation of this matter is now complete and no additional, related charges are anticipated."

The major US-based medical goods and services supplier said revenue in its Medical Products and Services division increased 5 percent during its fourth quarter (ended 30 June) this year to $2500 million, but added that operating earnings declined 3 percent to $178 million.

Cardinal said one reason for the lower earnings was that the group took a "$12-million non-recurring charge to resolve an outstanding insurance claim related to natural rubber latex litigation."

Dublin, Ohio-based Cardinal Health commented that sales of its Neu-Thera surgical gloves and its surgical instruments were strong during the quarter, adding that "sales and earnings growth in Europe and Canada continued as important contributors for the segment."

Cardinal Health saw total fourth-quarter revenue growth of 15 percent to a record $19 500 million, which it said was "driven by demand from hospitals, pharmacies and drug manufacturers, while operational improvements continued to strengthen earnings and deliver strong cash flow."

Operating earnings declined 9 percent to $532 million but continued to strengthen over the first half of fiscal 2005 the group said.