Advanced Marketing Service, the wholesaler and owner of PGW, has issued
long-awaited restatements of its earnings over the past five years that
follow a review of its coop advertising practices and accounting. The
company has been the subject of an ongoing Securities and Exchange
Commission investigation that has resulted in civil and criminal
settlements and a shakeup in the executive ranks.
Altogether the cumulative after-tax effect of the full restatements is a reduction in earnings of about $9.7 million as of March 31, 2003. The company had earlier said that the advertising portion of the restatement was about $11 million.
The company's revised estimates show that earnings per share for the four fiscal years ended March 31, 2000, 2001, 2002 and 2003 came in down four cents, 22 cents, 16 cents and 23 cents, respectively, from previous reported estimates. For the fiscal year ended March 31, 2004, earnings per share were 12 cents a share. AMS estimates that its net loss for fiscal year 2005 is between 96 cents and $1.06 per share rather than the previous estimate of 73 cents-83 cents per share.
The restatements also include new corrections to AMS's liability for differences between publishers' and AMS's shipping and receiving records. The company said this liability was overstated by about $7 million as of March 31, 1999 and about $500,000 as of March 31, 2003.
AMS added that most of the fiscal year 2005 loss is attributable to government investigations and lawsuits as well as the costs of consolidation of the distribution and returns centers. These costs have declined during the current fiscal year.
All the restatements must yet be audited independently. AMS hopes to submit its long delayed 10-K and 10-Q filings with the SEC soon.
Altogether the cumulative after-tax effect of the full restatements is a reduction in earnings of about $9.7 million as of March 31, 2003. The company had earlier said that the advertising portion of the restatement was about $11 million.
The company's revised estimates show that earnings per share for the four fiscal years ended March 31, 2000, 2001, 2002 and 2003 came in down four cents, 22 cents, 16 cents and 23 cents, respectively, from previous reported estimates. For the fiscal year ended March 31, 2004, earnings per share were 12 cents a share. AMS estimates that its net loss for fiscal year 2005 is between 96 cents and $1.06 per share rather than the previous estimate of 73 cents-83 cents per share.
The restatements also include new corrections to AMS's liability for differences between publishers' and AMS's shipping and receiving records. The company said this liability was overstated by about $7 million as of March 31, 1999 and about $500,000 as of March 31, 2003.
AMS added that most of the fiscal year 2005 loss is attributable to government investigations and lawsuits as well as the costs of consolidation of the distribution and returns centers. These costs have declined during the current fiscal year.
All the restatements must yet be audited independently. AMS hopes to submit its long delayed 10-K and 10-Q filings with the SEC soon.