Tesco Corporation Releases Restated Financial Statements for Q2 and Q3 2006 and the Filing of 2006 10-K to be Delayed
17 March 2007 - 11:10AM
PR Newswire (US)
Trading Symbol: "TESOF" on NASDAQ "TEO" on TSX HOUSTON, March 16
/PRNewswire-FirstCall/ -- Restatements for Q2 and Q3 2006
------------------------------- In accordance with its prior
announcement on March 8, 2007 (available at
http://www.tescocorp.com/ - Investor Relations-News Releases),
Tesco Corporation (the "Company") today released restated financial
statements for the quarters ending June 30, 2006 and September 30,
2006 respectively. These restated financial statements have been
reported in filings with securities regulatory authorities in
Canada through SEDAR (http://www.sedar.com/) and furnished on
amended 6-K reports to the Securities and Exchange Commission
(http://www.sec.gov/). These reports are also available at
http://www.tescocorp.com/. The restatements did not affect the
Company's previously announced earnings of $0.83 per diluted share
for 2006. Note: The Company will report its 2006 financial
statements on a U.S. GAAP basis as a domestic filer. With respect
to quarterly periods in 2006, the Company is filing restatements on
a Canadian GAAP basis (where noted) as these quarters were
previously reported on this basis. In this press release, unless
otherwise noted, all amounts are stated on a U.S. GAAP basis.
Revision to Previously Announced Q4 Earnings ($0.29 per diluted
share
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vs. previously reported $0.28); Revision to Previously Announced Q2
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Earnings ($0.07 per diluted share vs. previously reported $0.08)
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With respect to the restatement for the second quarter, the Company
has identified an additional adjustment related to research and
engineering cost for the second quarter of 2006. As a result of the
restatement, as revised, net income for the second quarter 2006 was
reduced from the reported $3.1 million to $2.2 million, on a
Canadian GAAP basis (not $2.5 million as previously announced) and
to $2.6 million on a U.S. GAAP basis (reduced from $3.0 million as
previously announced). A corresponding adjustment was made with
respect to the fourth quarter, which had the effect of increasing
reported net income from $10.2 million to $10.5 million on a U.S.
GAAP basis ($0.28 to $0.29 per share on a fully diluted basis).
This adjustment does not change the full calendar year 2006 net
income or earnings per share of $0.83, on a fully diluted basis.
Also, as previously announced, the restatement for the third
quarter 2006 reduced reported net income from $9.3 million to $8.2
million on a Canadian GAAP basis or $8.5 million on a U.S. GAAP
basis. Delayed Filing of Annual Report on Form 10-K
-------------------------------------------- The Company also
announced that it had delayed the filing of its Annual Report on
Form 10-K for the year ended December 31, 2006. As previously
announced, the Company disclosed that it had discovered certain
errors that would require it to restate its financial statements
for the second and third fiscal quarters of 2006 (as indicated
above), first became subject to the reporting and disclosure
requirements under the Securities Exchange Act and related rules
beginning January 1, 2007, was required to conduct an evaluation of
its internal controls over financial reporting as of December 31,
2006 in accordance with Section 404 of the Sarbanes Oxley Act and
identified certain material weaknesses in those controls, and it
conducted a self-initiated review of its past stock option granting
practices and related accounting, which required adjustments to its
previously reported financial information. Due to the occurrence
and timing of these events and actions and the uncertainty
surrounding the restatement of the Company's financial statements,
the Company has been unable to complete its financial statements in
time for the Company's Board of Directors' final review and deliver
all required materials to its independent public accounting firm in
time to complete its review and deliver its audit opinion. The
Company's Board will complete its final review after the delivery
of the final financial statements. The Company intends to file a
complete Annual Report on Form 10-K for the year ended December 31,
2006 no later than March 31, 2007. Other Matters ------------- In
the Company's news release on March 8, 2007 (available at
http://www.tescocorp.com/ - Investor Relations-News Releases), the
Company announced unaudited results for Q4 2006 and the year ended
December 31, 2006. In that release and in other presentations, the
Company also presented additional financial and other information.
For the reasons described in "Delayed Filing of Annual Report on
Form 10-K" above, the Company has not completed its financial
statements, its independent public accounting firm has not
delivered its audit opinion, and the Company's Board has not
reviewed final financial statements. Accordingly, the financial and
other information in the Company's news release and in any
presentations are subject to further changes and adjustments, which
may be material. The Company will announce the filing of its Annual
Report on Form 10-K when such filing is made. As previously
announced, the Company's Board of Directors and management
conducted a self-initiated review of our past stock option granting
practices and related accounting. The review of our stock option
practices did not uncover any evidence of fraud or manipulative
intent. However, the Company concluded that there had been
administrative errors in the granting of certain options and, as a
result, made the adjustments to stock compensation expense
described in its press release issued on March 8, 2007 (as adjusted
in the manner described above). The results of the Company's review
were also reported to regulatory authorities and the Toronto Stock
Exchange and the NASDAQ Global Market. The Toronto Stock Exchange
has made additional inquiries concerning the review; the Company
has responded to those inquiries and is otherwise cooperating
fully. Caution Regarding Forward-Looking Information; Risk Factors
This press release contains forward-looking statements within the
meaning of Canadian and United States securities laws, including
the United States Private Securities Litigation Reform Act of 1995.
From time to time, our public filings, press releases and other
communications (such as conference calls and presentations) will
contain forward-looking statements. Forward-looking information is
often, but not always identified by the use of words such as
"anticipate", "believe", "expect", "plan", "intend", "forecast",
"target", "project", "may", "will", "should", "could", "estimate",
"predict" or similar words suggesting future outcomes or language
suggesting an outlook. Forward-looking statements in this press
release include, but are not limited to, statements with respect to
expectations of TESCO's prospects, future revenues, earnings,
activities and technical results. Forward-looking statements and
information are based on current beliefs as well as assumptions
made by, and information currently available to, TESCO concerning
anticipated financial performance, business prospects, strategies
and regulatory developments. Although management considers these
assumptions to be reasonable based on information currently
available to it, they may prove to be incorrect. The
forward-looking statements in this press release are made as of the
date it was issued and TESCO does not undertake any obligation to
update publicly or to revise any of the included forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by applicable law. By their very
nature, forward-looking statements involve inherent risks and
uncertainties, both general and specific, and risks that outcomes
implied by forward-looking statements will not be achieved. We
caution readers not to place undue reliance on these statements as
a number of important factors could cause the actual results to
differ materially from the beliefs, plans, objectives, expectations
and anticipations, estimates and intentions expressed in such
forward-looking statements. These risks and uncertainties include,
but are not limited to, the impact of changes in oil and natural
gas prices and worldwide and domestic economic conditions on
drilling activity and demand for and pricing of our products and
services, other risks inherent in the drilling services industry
(e.g. operational risks, potential delays or changes in customers'
exploration or development projects or capital expenditures, the
uncertainty of estimates and projections relating to levels of
rental activities, uncertainty of estimates and projections of
costs and expenses, risks in conducting foreign operations, the
consolidation of our customers, and intense competition in our
industry), and risks associated with our intellectual property and
with the performance of our technology. These risks and
uncertainties may cause our actual results, levels of activity,
performance or achievements to be materially different from those
expressed or implied by any forward-looking statements. When
relying on our forward-looking statements to make decisions,
investors and others should carefully consider the foregoing
factors and other uncertainties and potential events. Further
information regarding these factors may be found in TESCO's most
recent annual information form and in TESCO's most recent
consolidated financial statements, management information circular,
quarterly reports, management's discussion and analysis, material
change reports and news releases and in TESCO's Annual Report on
Form 10-K for the year ended December 31, 2006 and in TESCO's
Annual Report on Form 40-F for the year ended December 31, 2005.
Copies of TESCO's Canadian public filings are available at
http://www.tescocorp.com/ and on SEDAR at http://www.sedar.com/.
TESCO's U.S. public filings are available at http://www.sec.gov/
and at http://www.tescocorp.com/. DATASOURCE: Tesco Corporation
CONTACT: Julio Quintana, (713) 359-7000; Anthony Tripodo, (713)
359-7000, Tesco Corporation
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