ADAC Laboratories is reporting financial results for fiscal 1999 (end-October 3) that include a big loss due to restructuring charges and other one-time expenses. The Milpitas, CA, nuclear medicine and information systems firm also confirms that it is the subject of an investigation by the Securities and Exchange Commission for matters relating to its restatement of financial results for several years.
ADAC reported a net loss of $33.6 million for the year, compared with net income of $7.4 million in fiscal 1998. The big loss included a restructuring charge of $4 million, as well as other one-time "non-ordinary" charges of $29.7 million for the year. Without the one-time charges, ADAC would have posted a loss of $6.6 million. The company was able to grow its revenues for the year, however. ADAC's annual revenues totaled $342.1 million, up 14% over the $300.5 million reported in 1998.
Complicating matters is the SEC investigation related to ADAC's restatement of its financial results for 1996, 1997 and the first three quarters of 1998. The company reported in December 1998 that it would restate revenues following an internal investigation of the company's revenue recognition practices.
This week ADAC reported that the SEC has issued a formal order of investigation, and that the company is cooperating with the SEC. An ADAC spokesperson said that the company first learned of the investigation in mid-1999.
By AuntMinnie.com staff writers
January 4, 2000
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