Five things to know:
1. Cardinal repurposed factories and sought out new suppliers of personal protective equipment to accommodate orders, which were double to 12 times normal volume in the third quarter, CEO Mike Kaufmann told analysts during a call.
2. Cardinal was able to meet demand by draining its reserves, which will affect its ability to maintain increased sales in the fourth quarter.
3. Cardinal’s third-quarter orders were largely for low-margin items. Sales for more profitable medical supplies such as surgical kits sank during elective case standstills, along with drug sales.
4. Declines related to supplies for elective surgeries counteracted Cardinal’s gains in profit, which saw a “modest” increase to $351 million for the quarter.
5. Going forward, Cardinal could move some production to North America because of how the pandemic has affected international supply chains. The move would affect pricing.
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