However, the CDC report triggered a number of press releases over the weekend linking Lumber Liquidators to the increased cancer risk. A long-awaited federal safety review found the flooring gave off enough formaldehyde gas to irritate the eyes, nose and throat of many people.
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The crux of the allegations was that Lumber Liquidators sold laminate flooring with levels of formaldehyde that exceeded those allowed in California, which has the strictest standards in the country.
The actual figure is six to 30 cases per 100,000 people, the CDC said Monday.
Lumber Liquidators said in a statement Monday that it has strengthened its “quality assurance procedures”, such as testing sample products.
The CDC’s website has information on how to reduce exposure to formaldehyde, as well as some specific details for people who bought flooring from Lumber Liquidators. Lumber Liquidators tumbled 20 percent to $11.40 at the close in NY, the biggest drop since August 5.
“We support their recommendations and share their (the agency’s) commitment to educating consumers”, a company statement said. Instead, the report suggests taking steps to improve air exchange and ventilation in the interim in order to reduce exposure, until the flooring has been installed long enough to reduce emissions.
Shortly after Monday’s opening bell, the stock was down about 23 percent at $10.96.
The chain is preparing to report fourth-quarter earnings on February 29. It is a colorless gas with a pungent smell, used among other things to manufacture building materials and household products. The company tried to defend itself, arguing that its flooring was indeed safe, but sales plunged regardless and ex-CEO Robert Lynch resigned. Because of the very conservative (health protective) nature of the models used in this analysis, the calculated risk is likely lower than our modeled estimate. For Lumber Liquidators, it’s déjà vu.
The release of a revised CDC cancer risk report detailing the dangers of certain types of Lumber Liquidators laminate flooring has caused its shares to drop.
Lumber Liquidators will pay $7.8 million in criminal fines, more than $1.2 million in community service payments and almost $970,000 in criminal forfeiture.
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The reversal brings a fresh headache to a company reeling from nearly a year of crisis. “We remain committed to operating with integrity and delivering quality flooring to our customers”.
