Xerium completes restatement of recent financial results
24 Aug '07
2 min read
Xerium Technologies Inc, a leading global manufacturer of clothing and roll covers used primarily in the paper production process announced that it had completed the previously-announced restatement of certain of its previously-issued financial statements, following a review of the accounting treatment of interest rate swaps that it entered into in June 2005.
Thomas Gutierrez, President and Chief Executive Officer of Xerium Technologies, commented, "We addressed the need to review our financial statements in light of evolving, complex interest rate swap accounting, and are pleased that we were quickly able to resolve all issues completely and accurately. As we noted previously, these hedging activities have been successful in fulfilling their goal of providing stability to the Company's interest rate structure."
"It should also be noted that this technical accounting issue affected only interest expense, related income taxes and net income (loss). There was no impact on operating cash flow, sales, operating income or Adjusted EBITDA, nor does it affect the Company's debt covenants. As can be seen in the amended financial statements, the aggregate effect of the restatement was to boost the Company's net income over the restated period."
"For the period of the third quarter 2007 through the second quarter 2008, at which time the current interest rate swaps are set to expire, we expect to record in the aggregate approximately $8 million of additional interest expense to our Income Statement in connection with marking to market through earnings the 2005 interest rate swaps. This additional interest expense over that period is excluded for the purposes of our bank covenant calculations and therefore has no effect on those calculations."
marketing@alchempro.com
