DAVIDsTEA Announces Restatement of Previously Issued Interim Financial Statements to Reflect Unrecorded Non-Cash Impairment C...
19 December 2019 - 1:14AM
DAVIDsTEA Inc. (Nasdaq:DTEA), a leading tea merchant and expert in
North America, today announced that its Board of Directors,
following the recommendation of the its Audit Committee, is
restating its previously-issued interim condensed consolidated
financial statements for the quarterly periods ended May 4, 2019
and August 3, 2019 to reflect the restatement resulting from an
error in monitoring IAS 36 impairment triggers post-adoption of
IFRS 16, Leases and a change in the elections applied upon initial
adoption of IFRS 16, Leases on February 3, 2019. The previously
filed unaudited condensed interim consolidated financial statements
for the quarterly periods ended May 4, 2019 and August 3, 2019
should no longer be relied upon.
The Company is filing today with the United
States Securities and Exchange Commission a Form 8-K containing
additional information about the restatement of financial
statements and associated disclosures. The restatement only impacts
non-cash impairment charges, amortization expenses, deficit at
February 3, 2019, and the balance of right-of-use assets, but it
does not affect other aspects of the Company’s previously reported
financial statements.
The Company intends to delay the filing of its
Quarterly Report on Form 10-Q for the period ended November 2,
2019. The Company expects to file the following as soon as
practicable (i) an amendment to its Quarterly Report on Form 10-Q
for the period ended May 4, 2019 to restate its unaudited condensed
consolidated financial statements and related financial information
at May 4, 2019 and to amend certain other items within that report,
(ii) an amendment to its Quarterly Report on Form 10-Q for the
period ended August 3, 2019 to similarly restate its unaudited
condensed consolidated financial statements and related financial
information at August 3, 2019 and (iii) its Quarterly Report on
Form 10-Q for the period ended November 2, 2019.
About DAVIDsTEA
DAVIDsTEA is a leading retailer of specialty
tea, offering a differentiated selection of proprietary loose-leaf
teas, pre-packaged teas, tea sachets and tea-related gifts,
accessories and food and beverages through over 230 company-owned
and operated DAVIDsTEA retail stores in Canada and the United
States, as well as through its e-commerce platform at
davidstea.com. A selection of DAVIDsTEA products are also available
in grocery stores across Canada through its growing wholesale
distribution channel. The Company is headquartered in Montréal,
Canada.
Forward-Looking Statements
This press release contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995 and Section 21E of the Securities Exchange Act
of 1934. Such statements may be preceded by the words "intends,"
"may," "will," "plans," "expects," "anticipates," "projects,"
"predicts," "estimates," "aims," "believes," "hopes," "potential"
or similar words. These forward-looking statements are based on our
current assumptions, expectations and beliefs and are subject to
substantial risks, estimates, assumptions, uncertainties and
changes in circumstances that may cause the Company’s actual
results, performance or achievements, as well as the Company’s
expectations regarding materiality or significance and the
restatement’s quantitative effects, to differ materially from those
expressed or implied in any forward-looking statement. Factors that
could cause actual results to differ materially from those in the
forward-looking statements include, but are not limited to, the
risk that additional information may arise from the Company’s and
its audit committee’s internal review, the risk that the process of
preparing and auditing the restated financial statements or other
subsequent events would require the Company to make additional
adjustments and the time and effort required to complete the
restatement of its financial statements, whether the reassessment
of the Company’s internal controls over financial reporting could
lead the Company to conclude that there were deficiencies in its
internal control over financial reporting that constitute material
weaknesses; the Company’s responses to potential comments from the
SEC; adverse effects on the Company’s business and operations as a
result of increased regulatory, media or financial reporting issues
and practices, rumors or otherwise; the costs and expenses of the
restatement; the initiation of legal proceedings; the volatility of
the Company’s stock price; and other risks described more fully in
the Company’s filings with the SEC. Because the risks, estimates,
assumptions and uncertainties referred to above could cause actual
results or outcomes to differ materially from those expressed in
any forward-looking statements, you should not place undue reliance
on any forward-looking statements. Any forward-looking statement
speaks only as of the date hereof, and, except as required by law,
the Company assumes no obligation and does not intend to update any
forward-looking statement to reflect events or circumstances after
the date hereof.
Investor Contact |
Media Contact |
MaisonBrison Communications |
PELICAN PR |
Pierre Boucher |
Lyla Radmanovich |
514.731.0000 |
514.845.8763 |
investors@davidstea.com |
media@rppelican.ca |
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