Cardinal Health, Dublin, Ohio, lowered its earnings forecast and announced it has received a subpoena from the Securities and Exchange Commission in connection with an investigation into the company's drug-distribution business.
The company, which disclosed the investigation last month, also said it has learned that the U.S. attorney's office for the Southern District of New York has launched an inquiry into the same accounting issue, which reportedly involves how the firm classified millions of dollars as either operating revenue or revenue from bulk deliveries to customer warehouses.
Cardinal lowered its projected growth in earnings per share for 2004 to 11%. Earlier guidance had pegged growth in the mid-teens or better.
Earnings per share are expected to be from 88 cents to 91 cents for the quarter and $3.46 to $3.49 for the year. The double bad news triggered a 24% drop in Cardinal's stock price.