<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 11-K
Annual Report Pursuant to Section 15(d) of the
Securities Exchange Act of 1934
For the Fiscal Year Ended June 30, 2000
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Commission File Number 0-12591
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Cardinal Health, Inc. Profit Sharing and Retirement Savings Plan
----------------------------------------------------------------
(Full Title of Plan)
Cardinal Health, Inc.
7000 Cardinal Place
Dublin, Ohio 43017
(Name of Issuer of the Securities Held Pursuant to the Plan and
Address of its Principal Executive Office)
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CARDINAL HEALTH, INC.
PROFIT SHARING AND RETIREMENT SAVINGS PLAN
Index to Financial Statements and Schedule
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Signature
Reports of Independent Public Accountants
Statements of Assets Available for Plan Benefits as of June 30, 2000 and 1999
Statement of Changes in Assets Available for Plan Benefits for the Year Ended
June 30, 2000
Notes to Financial Statements and Schedule
Item 4(i) - Schedule of Assets Held for Investment Purposes as of June 30, 2000
Consents of Independent Public Accountants
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the members
of the Plan Committee have duly caused this annual report to be signed on its
behalf by the undersigned thereunto duly authorized.
CARDINAL HEALTH, INC.
PROFIT SHARING AND RETIREMENT
SAVINGS PLAN
Date: December 20, 2000
-------------------------------------
Richard Miller, Plan Committee Member
2
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REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Plan Committee of
CARDINAL HEALTH, INC. PROFIT
SHARING AND RETIREMENT SAVINGS PLAN:
We have audited the accompanying statement of assets available for plan benefits
of the CARDINAL HEALTH, INC. PROFIT SHARING AND RETIREMENT SAVINGS PLAN (the
Plan) as of June 30, 2000, and the related statement of changes in assets
available for plan benefits for the year ended June 30, 2000. The statement of
assets available for plan benefits as of June 30, 1999, was audited by other
auditors whose report dated December 22, 1999, expressed an unqualified opinion
on the statement. These financial statements and the schedule referred to below
are the responsibility of the Plan's management. Our responsibility is to
express an opinion on these financial statements and schedule based on our
audit.
We conducted our audit in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
from material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the assets available for plan benefits of the Plan as of
June 30, 2000, and the changes in assets available for plan benefits for the
year then ended, in conformity with accounting principles generally accepted in
the United States.
Our audit was made for the purpose of forming an opinion on the basic financial
statements taken as a whole. The supplemental schedule of assets held for
investment purposes is presented for the purposes of additional analysis and is
not a required part of the basic financial statements but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. The supplemental schedule has been subjected to the auditing procedures
applied in the audit of the basic financial statements and, in our opinion, is
fairly stated in all material respects when considered in relation to the basic
financial statements taken as a whole.
/s/ ARTHUR ANDERSEN LLP
Columbus, Ohio
December 15, 2000
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INDEPENDENT AUDITORS' REPORT
To the Plan Committee of
Cardinal Health, Inc. Profit
Sharing and Retirement Savings Plan:
We have audited the accompanying statement of assets available for benefits of
Cardinal Health, Inc. Profit Sharing and Retirement Savings Plan as of June 30,
1999. This financial statement is the responsibility of the Plan's management.
Our responsibility is to express an opinion on the financial statement based on
our audit.
We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, the financial statement referred to above presents fairly, in
all material respects, the assets available for benefits of the Plan as of June
30, 1999 in conformity with accounting principles generally accepted in the
United States of America.
/s/ DELOITTE & TOUCHE LLP
Columbus, Ohio
December 22, 1999
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CARDINAL HEALTH, INC.
PROFIT SHARING AND RETIREMENT SAVINGS PLAN
Statements of Assets Available for Plan Benefits
As of June 30, 2000 and 1999
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<TABLE>
<CAPTION>
2000 1999
------------ ------------
<S> <C> <C>
ASSETS:
Investments, at fair market value $362,149,672 $294,060,908
Participant loans 9,557,104 7,051,480
------------ ------------
Total investments 371,706,776 300,921,440
------------ ------------
RECEIVABLES:
Employer 19,354,871 14,260,332
Employee 865,980 781,350
------------ ------------
Total receivables 20,220,851 15,041,682
------------ ------------
ASSETS AVAILABLE FOR PLAN BENEFITS $391,927,627 $316,154,070
============ ============
</TABLE>
The accompanying notes to financial statements and schedule are an integral part
of these statements.
5
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CARDINAL HEALTH, INC.
PROFIT SHARING AND RETIREMENT SAVINGS PLAN
Statement of Changes in Assets Available for Plan Benefits
For the Year Ended June 30, 2000
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
ADDITIONS:
Contributions-
Employee $ 25,019,819
Employer 25,524,245
------------
Total 50,544,064
------------
Assets transferred from previous qualified plan 14,049,687
Net realized and unrealized gains 36,055,088
Dividends and interest 9,318,502
------------
Total 59,423,277
------------
Total additions 109,967,341
DEDUCTIONS:
Distributions to participants 34,060,194
Administrative expenses 133,590
------------
Total deductions 34,193,784
NET INCREASE 75,773,557
------------
ASSETS AVAILABLE FOR PLAN BENEFITS, BEGINNING OF YEAR 316,154,070
------------
ASSETS AVAILABLE FOR PLAN BENEFITS, END OF YEAR $391,927,627
============
</TABLE>
The accompanying notes to financial statements and schedule are an integral part
of this statement.
6
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CARDINAL HEALTH, INC.
PROFIT SHARING AND RETIREMENT SAVINGS PLAN
Notes to Financial Statements and Schedule
June 30, 2000
--------------------------------------------------------------------------------
(1) DESCRIPTION OF PLAN
The following description of the Cardinal Health, Inc. Profit Sharing and
Retirement Savings Plan (the Plan) provides only general information.
Participants should refer to the Plan agreement for a more complete
description of the Plan's provisions.
GENERAL
The Plan is a defined contribution plan covering substantially all
employees of Cardinal Health, Inc. (the Company) and certain of its
subsidiaries not covered by a collective bargaining agreement who have
completed at least 180 days of service, as defined by the Plan agreement.
The Plan was adopted on March 25, 1987 and was most recently amended July
1, 1999.
The Plan is administered by the Plan committee. The Plan trustee, record
keeper and asset custodian is Putnam Investments (Putnam). Substantially
all administrative expenses are paid by the Plan.
INVESTMENT OPTIONS
Upon enrollment in the Plan, a participant may direct employee
contributions in any combination of the following investment options.
Participants may change their investment options at any time.
Participants have invested or may invest in one or more of the following
accounts:
JANUS WORLDWIDE FUND - This fund seeks to provide long-term growth of
capital with preservation of capital. The fund typically invests in
worldwide and U.S. common stocks.
NBF PARTNERS FUND - This fund invests mainly in common stocks of mid-
to large-capitalization companies. The fund seeks to reduce risk by
diversifying among many companies and industries.
DODGE AND COX STOCK FUND - This fund invests primarily in a broadly
diversified portfolio of common stocks. The fund seeks long-term
growth of principal and income.
VANGUARD PRIME MONEY MARKET FUND - This fund seeks a high level of
current income consistent with liquidity and stability of principal
in money market instruments. The fund invests primarily in short-term
money market instruments, including certificates of deposit, bankers'
acceptances, commercial paper and other money market securities.
FRANKLIN TEMPLETON SMALL CAP GROWTH FUND - This fund's investment
goal is long-term capital growth. Under normal market conditions, the
fund invests 65% of total assets in equity securities of small cap
growth companies.
7
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CARDINAL HEALTH, INC.
PROFIT SHARING AND RETIREMENT SAVINGS PLAN
Notes to Financial Statements
June 30, 2000
--------------------------------------------------------------------------------
THE GEORGE PUTNAM FUND OF BOSTON - This fund is a balanced portfolio
that seeks to provide current income from stock dividends and bonds
as well as capital appreciation. The typical stock/bond ratio is
60%-70% stocks and 30%-40% bonds.
PUTNAM INVESTORS FUND - This fund seeks long-term growth of capital
and any increased income that results from this growth. The fund
invests mainly in common stocks of U.S. companies, with a focus on
growth stocks.
PUTNAM INCOME FUND - This fund invests mainly in bonds that are
obligations of corporations and governments worldwide denominated in
U.S. dollars, are either of investment-grade or below
investment-grade, and have intermediate- to long-term maturities.
PUTNAM ASSET ALLOCATION GROWTH PORTFOLIO FUND - This fund seeks
capital appreciation. The fund has an allocation ratio of 55%-85%
stocks and 15%-45% fixed income investments.
PUTNAM ASSET ALLOCATION BALANCED PORTFOLIO FUND - This fund seeks to
maximize total return on investment. The fund has an allocation ratio
of 45%-75% stocks and 25%-55% fixed income investments.
PUTNAM ASSET ALLOCATION CONSERVATIVE PORTFOLIO FUND - This fund seeks
total return consistent with preservation of capital. The fund has an
allocation ratio of 0%-30% stocks and 70%-100% fixed income
investments.
S&P 500 FUND - This fund seeks a return that closely approximates the
return of the Standard & Poor's 500 Composite Stock Price Index, a
common measure of U.S. market performance.
CARDINAL HEALTH, INC. EQUITY SECURITIES - This fund is entirely
comprised of Cardinal Health, Inc. common stock.
CONTRIBUTIONS TO THE PLAN
Participants may elect to contribute from 1% to 20% of their
compensation, as defined in the Plan agreement, through payroll
deductions, subject to certain limitations or the maximum allowed under
the IRS guidelines.
The Plan also provides for matching contributions by the Company in an
amount equal to fifty percent (50%) of the first six percent (6%) of
participants' compensation contributed to the Plan.
8
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CARDINAL HEALTH, INC.
PROFIT SHARING AND RETIREMENT SAVINGS PLAN
Notes to Financial Statements
June 30, 2000
--------------------------------------------------------------------------------
The Company may make a discretionary contribution, which is determined
and approved by the Company's board of directors. The discretionary
contributions are allocated to participants based on a formula defined in
the Plan agreement. The discretionary contributions for the Plan year
ended June 30, 2000 totaled $18,564,622.
ELIGIBILITY AND VESTING
Participants are immediately vested in their contributions and rollovers,
plus actual earnings thereon. Upon death, disability, or attainment of
retirement age, the participant's interest in the qualified employer
matching contributions and earnings thereon, become fully vested. If a
participant's employment is terminated prior to any of these three
conditions being met, vesting in the qualified matching contributions,
and earnings thereon, is based on years of continuous service.
Participants are vested in the applicable percentage of such matching
contributions as follows:
Participants employed on or before December 31, 1996 vest in company
matching contributions and profit sharing contributions over a seven year
period, based on years of service.
<TABLE>
<CAPTION>
YEARS OF SERVICE VESTED PERCENTAGE
---------------- -----------------
<S> <C>
Less than 3 0%
3 20%
4 40%
5 60%
6 80%
7 100%
</TABLE>
Participants hired after December 31, 1996 vest in company matching
contributions and profit sharing contributions over a five year period,
based on years of service.
<TABLE>
<CAPTION>
YEARS OF SERVICE VESTED PERCENTAGE
---------------- -----------------
<S> <C>
Less than 2 0%
2 25%
3 50%
4 75%
5 100%
</TABLE>
9
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CARDINAL HEALTH, INC.
PROFIT SHARING AND RETIREMENT SAVINGS PLAN
Notes to Financial Statements
June 30, 2000
--------------------------------------------------------------------------------
DISTRIBUTION OF BENEFITS
Upon termination of service, death, retirement or disability, the
participant may elect to receive a lump sum distribution, installment
payments, life annuity contract, joint survivor annuity, or rollover the
balance into another qualified plan. In addition, the Plan includes a
provision for employees to make withdrawals from their account under
certain "hardship" circumstances.
FORFEITURES
Non-vested account balances are generally forfeited upon termination.
Employer matching contributions and earnings thereon forfeited by
terminated employees totaled $1,349,712 for the year ended June 30, 2000.
Such forfeited amounts are used to reduce future Company contributions to
the Plan.
PARTICIPANT LOANS
Participants may borrow from their fund accounts a minimum of $1,000 up
to a maximum equal to the lesser of $50,000 or 50% of their vested
account balance. Loan terms range from 1-5 years or up to 15 years for
the purchase of a primary residence. The loans are secured by the
remaining vested balance in the participant's account and bear interest
at a rate commensurate with local prevailing rates as determined monthly
by the Plan administrator. Principal and interest are paid ratably
through regular payroll deductions.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING AND USE OF ESTIMATES
The accompanying financial statements have been prepared using the
accrual method of accounting. The preparation of the financial statements
in conformity with accounting principles generally accepted in the United
States requires the Plan's management to use estimates and assumptions
that affect the accompanying financial statements and disclosures. Actual
results could differ from those estimates.
INVESTMENT VALUATION AND INCOME RECOGNITION
The investments of the Plan are stated at fair market value as determined
by the asset custodian, using established market prices of underlying
investments. Participant loans are valued at cost, which approximates
fair market value.
10
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CARDINAL HEALTH, INC.
PROFIT SHARING AND RETIREMENT SAVINGS PLAN
Notes to Financial Statements
June 30, 2000
--------------------------------------------------------------------------------
Net realized gains and losses on sales of assets are based on sale
proceeds and the market value of assets at the beginning of the Plan year
or cost at the time of purchase during the Plan year. Net unrealized
appreciation or depreciation is included in net realized gains and losses
currently on the statement of changes in assets available for plan
benefits.
RECLASSIFICATIONS
Certain prior year amounts have been reclassified to conform with the
2000 presentation.
(3) TAX STATUS
The Plan obtained its latest determination letter on September 30, 1994
in which the Internal Revenue Service (IRS) stated that the Plan, as then
designed, was in compliance with the applicable requirements of the
INTERNAL REVENUE CODE (IRC). The Plan has been amended since the latest
determination letter. However, the Company believes that the Plan, as
currently designed and operated, is in compliance with the applicable
requirements of the IRC.
(4) PARTY-IN-INTEREST TRANSACTIONS
Certain investments of the Plan are shares of investment funds managed by
Putnam. Putnam is also the trustee, record keeper, and an asset custodian
as defined by the Plan and, therefore, related investment transactions
qualify as party-in-interest transactions.
The Plan offers loans to participants. Related loan transactions qualify
as party-in-interest transactions.
(5) INVESTMENTS
The fair market values of individual assets that represent 5% or more of
the Plan's assets as of June 30, 2000 and 1999 are as follows:
<TABLE>
<CAPTION>
2000 1999
------------ ------------
<S> <C> <C>
Janus Worldwide Fund $ 25,994,885 $ 9,004,710
Vanguard Prime Money Market Fund 23,323,427 19,146,013
The George Putnam Fund of Boston 23,552,048 25,871,188
Putnam Investors Fund 77,425,509 65,101,328
Cardinal Health, Inc. Equity Securities 144,750,219 132,571,199
</TABLE>
11
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CARDINAL HEALTH, INC.
PROFIT SHARING AND RETIREMENT SAVINGS PLAN
Notes to Financial Statements
June 30, 2000
--------------------------------------------------------------------------------
(6) PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the
right under the Plan to terminate the Plan subject to the provisions of
ERISA. In the event of plan termination, participants will become fully
vested in their account balances.
(7) PLAN MERGER
Effective August 7, 1998, the Company completed a merger transaction with
R.P. Scherer. The R.P. Scherer Retirement Plan was merged into the Plan
upon approval by the Company's board of directors. The R.P. Scherer
Retirement Plan assets were merged into the Plan effective September 1,
1999. Assets of approximately $14.0 million were transferred into the
Plan as a result of this merger.
(8) SUBSEQUENT EVENTS
The Company's merger transactions with Allegiance Corporation and
Automatic Liquid Packaging were completed on February 3, 1999 and
September 10, 1999, respectively. Subsequent to the Plan year, the
Company's board of directors approved the merger of both the Allegiance
Retirement Plan and the Automatic Liquid Packaging, Inc. Employees 401(k)
Savings Plan into the Plan, effective January 1, 2001. Assets of
approximately $560,000,000 and $17,000,000 will be transferred into the
Plan from the Allegiance Retirement Plan and the Automatic Liquid
Packaging, Inc. 401(k) Savings Plan, respectively, as a result of these
Plan mergers.
(9) REQUIRED SCHEDULE INFORMATION
No information is to be reported for the following schedules as of June
30, 2000, or for the year then ended.
a. Nonexempt Transactions
b. Leases in Default or Classified as Uncollectible
c. Investment Assets Both Acquired and Disposed of During the Plan Year
d. Loans or Fixed Income Obligations
12
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CARDINAL HEALTH, INC.
PROFIT SHARING AND RETIREMENT SAVINGS PLAN
Item 4(i) - Schedule of Assets Held for Investment Purposes
As of June 30, 2000 Schedule I
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
IDENTITY OF ISSUE BORROWER, MARKET
LESSOR OR SIMILAR PARTY DESCRIPTION VALUE
--------------------------- ------------------------------------------------------------- ------------
<S> <C> <C>
* Putnam Janus Worldwide Fund $ 25,994,885
* Putnam NBF Partners Fund 2,798,949
* Putnam Dodge and Cox Stock Fund 9,156,119
* Putnam Franklin Templeton Small Cap Growth Fund 15,136,336
* Putnam The George Putnam Fund of Boston 23,552,048
* Putnam Putnam Investors Fund 77,425,509
* Putnam Putnam Income Fund 5,352,717
* Putnam Putnam Asset Allocation Growth Portfolio Fund 8,508,477
* Putnam Putnam Asset Allocation Balanced Portfolio Fund 5,781,046
* Putnam Putnam Asset Allocation Conservation Portfolio Fund 7,868,999
* Putnam Cardinal Health, Inc. Equity Securities 144,750,219
* Putnam S&P 500 Fund 12,500,941
* Putnam Vanguard Prime Money Market Fund 23,323,427
* Various participants Participant loans (interest rates ranging from 6.0% to 10.6%) 9,557,104
------------
Total $371,706,776
============
</TABLE>
* Denotes party-in-interest.
The accompanying financial statements and notes thereto are an integral part of
this schedule.
