Lumber Liquidators lost about a quarter of its market value in early trading Feb. 22 after a report by The Center for Disease Control and Prevention (CDC) showed that people exposed to excessive levels of formaldehyde in some types of laminate flooring sold by the company were three times more likely to get cancer than previously estimated.
The CDC said it now estimated the risk of cancer at six to 30 cases per 100,000 people, compared with the two to nine cases it had previously estimated. The agency said the revised results were preliminary.
In a notice on its website dated Feb. 18, the CDC said it had used an incorrect value to calculate ceiling height in its previous report. The error meant that its estimates of the airborne concentration of formaldehyde—a carcinogen—were about three times lower than they should have been.
Last March, a “60 Minutes” exposé about Lumber Liquidators’ laminate exposed the initial formaldehyde issue. On Feb. 21 the show featured a revised report noting the possibility of an error on the part of CDC scientists in their initial findings.
“We sent the report to scientists at several universities and discovered the government forgot to convert feet to meters in some calculations,” said Anderson Cooper, “60 Minutes” correspondent.
In an emailed statement following the updated report, Lumber Liquidators said it had significantly strengthened its quality controls: “We are encouraged that CDC is seeking a broader review of their conclusions.”
Lumber Liquidators’ shares were down 24.3% shortly after the start of trading Feb. 21, its biggest intraday percentage loss in six months. The company’s sales and shares have taken a significant hit since the initial “60 Minutes” report last March.
The company has suspended sales of all laminate flooring imported from China.