This is a piece of S&W's 8-K filed this past month....a "restatement" is generally reeeely bad news......
On August 14, 2003, Smith & Wesson Holding Corporation issued a press release announcing its expected results of operations for the fiscal year ended April 30, 2003, that the filing of its Annual Report on Form 10-KSB for the fiscal year ended April 30, 2003 has been delayed, that it has engaged its independent accountants to re-audit the fiscal year 2002 and that it will restate its financial statements for the fiscal year 2002. A copy of the press release is attached as an exhibit to this report.
Too early to worry yet. Who knows, maybe they had Arthur Anderson as accountants! <G> With all the corporate roiling, the consultant/accounting business is under a lot of scruitiny these days. You know how it is with the suits -- all things considered, they'd rather not go to jail. <GGG>
Posts: 300 | Location: W. New Mexico | Registered: 28 December 2002
I agree Grumble, it is too early to be concerned- the market hasn't destroyed their common share price (but there's no trade volume). To restate the past year normally means that there is a serious problem. However, if they've been following GAAP no one should be concerned about becoming a ward of the state. If they've pulled a WorldCom- i.e. capitalized operational expenses, then we'll all suffer. I can't imagine how much fun the Brady folks would have with an accounting scandal at a firearms manufacturing firm......
B&W, yep, if there does happen to be some scandal, it will be bad news. But from the quote you provided, it sounds like they're restating their 2002 10k info. If I'm not mistaken, that would be the the first audit after the new guys took over from the Brits who tried to run S&W into the ground. So, lots of acquisition charges and writeoffs could have been misstated when it was acquired. That would have a ripple effect into subsequent years, and with all the emphasis currently on corporate honesty, it is very possible they just want to get all the dirt out.
For all we know, the previous owners might have tried to write off bribes to Jesse Jackson and Andrew Cuomo as legal expenses. <GGG> I don't see a WCOM or Enron type problem here. At least, not yet.
Posts: 300 | Location: W. New Mexico | Registered: 28 December 2002
Outstanding insight Grumble....I've not followed SWB before but it has mild appeal. I was unaware of the issues you mentioned. Hopefully we'll see solid numbers soon.
Seems to me investing in the stock would be more to make a statement than to make money. That's thinking too much like a liberal for my taste, though! <GGG>
Posts: 300 | Location: W. New Mexico | Registered: 28 December 2002
That's interesting....Multex has them earning +.02 per share....either way you're likely right. I believe that it may be worth following for a time to see if retail speculation moves the pps but I seriously doubt revenues will drive SWB up this year....
