Nearly six months after the Securities and Exchange Commission began an investigation into the company's finances and five weeks after a halt in trading of its shares, Aerosonic Corp. of Clearwater restated its earnings for the past four years.
The revised statements show the aircraft instrumentation maker had losses in 1999, 2000 and 2001, when it had previously reported earnings.
In 2002, the restatement resulted in a decline in revenues, though the company ended the year with profits.
For the most recent fiscal year, the 12 months ended Jan. 31, 2003, Aerosonic said it has revenues of $25.7-million, down from $26.7-million in fiscal 2002. Net income was $1-million, or 26 cents a share, compared with $711,000, or 18 cents a share, in 2002.
Mark Perkins, Aerosonic's executive vice president, said of the long-awaited restatements: "It was a long process but a very necessary one. This is a much stronger, more vibrant company for having gone through it, and we are excited about moving forward."
Aerosonic revealed that it had overstated revenue and inventory by several million dollars in March, two months after a new chief financial officer, Gary Colbert, joined the company. In May, the SEC said it was investigating the company, and J. Mervyn Nabors, the company's chairman, stepped down and was removed from day-to-day management duties. Nabors had resigned as president and been replaced by David J. Baldini in November 2002.
On Sept. 25, the American Stock Exchange halted trading in Aerosonic's shares for failure to file current financial information. The company said it will file results for the first two quarters of its current fiscal year by Nov. 15 and hopes trading will resume soon afterward.
Aerosonic said it is cooperating with the SEC in its investigation. Its internal investigation showed the company had overstated inventory, understated the cost of sales and incorrectly reported other items over the past few years. Contributing to the problems were falsified inventory records, improper adjustments for obsolete and slow-moving inventory and improper fixed asset capitalization.
The restatements meant that:
In 2002, revenue was cut by $738,000 to $26.7-million; net income was cut by $329,000 to $711,000 or 18 cents per share.
In 2001, revenue was cut by $1.1-million to $23.5-million; net income was reduced by $798,000 to a net loss of $342,000 or 9 cents a share.
In 2000, revenue remained the same at $23.3-million but earnings were reduced by $3.4-million to a net loss of $3.1-million or 80 cents a share.
In 1999, revenues remained unchanged at $19.7-million but earnings were reduced by $1.4-million to a net loss of just over $1-million or 26 cents a share.
Baldini, Aerosonic's president and chief executive, said the company has instituted new financial controls and added three independent directors to its board. They are David M. Vosen, president of SouthTrust Bank in Tampa; Charles M. Foster Jr., who previously was an executive with Teledyne Technologies Inc., an aerospace and defense company; and Robert J. McGill, president of L-3 Communications-Display Systems, a division of L-3 Communications Corp.
_ Kris Hundley can be reached at hundleysptimes.com or (727) 892-2996.