Post a CommentAltera Financials Restatement Estimate: $28M-$38M
Staff Reporter -- Electronic News, 9/5/2006
Programmable logic provider, Altera Corp., reiterated its guidance for next quarter’s revenues and separately said that it expects charges of between $28 million and $38 million total related to its review of stock options backdating.
Separately the San Jose-based company reaffirmed its guidance for Q3 for between $334 million to $344 million.
To maintain its stock exchange listing, Altera has filed for an extension with the Nasdaq Listing Qualifications Panel, saying that it needs until October 26 to file quarterly reports with the U.S. Securities and Exchange Commission for the periods ended Dec., 30, 2006; March 31, 2006; and June 30, 2006.
Altera said that although the special committee has not yet reached its final conclusions, it has preliminarily identified certain stock option grants issued from December 1996 through March 2001 where the grant date differed from the recorded measurement date. The company anticipates recording additional non-cash stock-based compensation charges of approximately $18 million, pre-tax, in connection with these stock option grants.
In addition, Altera said that its special committee's needs more time to complete its review concerning additional stock-based compensation charges arising from the modification of some employees' stock option agreements in connection with the termination of their employment. Based on the preliminary work on this issue the company anticipates recording additional non-cash stock-based compensation charges of approximately $20 million to $30 million, pre-tax.
The company is in the process of evaluating the tax impact of the adjustments, including additional tax provisions primarily related to limitations on deductibility for certain executive compensation. The estimated aggregate pre-tax charge of $38 - $48 million will result in a restatement of the company's previously issued financial statements. Based on the information presently available, the company does not anticipate that the restatement will result in a material charge to the statement of operations for its fiscal year ended 2005.
Altera first announced in May plans to conduct an internal investigation of its historical stock options granting practices. Soon after, the SEC launched its own informal investigation of Altera's stock option granting. Altera is one of many companies examining historical stock options granting practices.
