Under threat of being removed from the Nasdaq stock exchange, Vancouver-based Northwest Pipe Co. on Friday issued late and restated financial reports, including data for all of 2011 showing the company bounced back to profitability.
The Nasdaq had given the company, a maker of steel pipe primarily for drinking water systems, until April 30 to file its delayed financial reports, including its 2011 annual financial report and quarterly reports from last year.
Northwest Pipe reported a profit of $12.7 million, or $1.35 per diluted share, for all of 2011. That compares with a loss of $5.4 million, or 59 cents per diluted share, for all of 2010.
The company’s revenues for all of 2011 increased by 32 percent to $511.7 million, “the highest ever,” the company said in a news release, exceeding the previous high of $451.4 million in 2008.
The company said it will hold a conference call on its 2011 financial results on Monday.
Northwest Pipe’s release of late financial statements Friday complied with the Nasdaq’s demand that it file those reports by the end of April or be delisted from the exchange. The fresh information, filed with the U.S. Securities and Exchange Commission, also showed the company possessing a healthy bottom line after it announced in March new “material errors” with its accounting procedures.
Those errors led the company to say it would have to restate its books, including decreasing its retained earnings by up to $12 million.
In its 2011 annual financial report it released Friday, Northwest Pipe said it has corrected financial data going back to 2009. The corrections were needed, in part, because the company failed to periodically re-evaluate assumptions it made in allocating the depreciation costs of its equipment.
The company said it has made improvements to its internal financial controls, including hiring “additional personnel for critical accounting roles.”
But the company must continue to evaluate the new controls and “there is no assurance that management’s remedial efforts conducted to date will be sufficient or that additional remedial actions will not be necessary.”
Northwest Pipe has previously disclosed other accounting problems. In November 2009, it announced wrinkles in the procedures it used to account for revenues. Shareholders sued the company in December 2009, accusing it of making “false and misleading” statements that inflated the company’s stock.
The lawsuit names the company and Brian Dunham, the company’s former president and CEO, and Stephanie Welty, the company’s former chief financial officer.
Northwest Pipe also is the subject of an SEC investigation.
In its 2011 annual financial report, the company said “any action by the SEC or other governmental agency could result in civil or criminal sanctions against us and/or certain of our current and former officers, directors and employees.
“The investigation is at an early stage and, at this time, it is not possible to predict its outcome.”
The company also has previously received multiple delisting warnings from the Nasdaq stock exchange for failing to file its financial reports in a timely manner.
A company can be delisted and continue to be profitable. However, a delisting can make it more difficult and more expensive for a company to raise capital.
Northwest Pipe manufactures large-diameter, high-pressure steel pipelines, primarily for drinking water systems.
The company’s stock, which trades as NWPX, closed up 11 cents Friday, at $21.14 per share.
