Mon dieu!

May 11, 2005

Late on Friday, Brightpoint (CELL) put out a release that said the company planned to restate its results for 2004 because it overstated revenues in France and Australia by around $6.2 million and on Monday, it filed an amended 10-K. Though the numbers don’t seem all that significant at first glance — revenue was $1.9 billion in both versions of the K — the difference really comes across in Brightpoint’s discussion of operating income from continuing operations. In the K Brightpoint filed on Feb. 3, that number was up an impressive 44%. But in Monday’s revised K, that number dropped to 31%. Gross profit also dropped to 15% in the amended filing from the earlier 20%.

But as a regular reader points out, what’s really surprising is the language Brightpoint uses to describe the goof. “Management concluded that the company’s financial reporting was effective as of Dec. 31, 2004 notwithstanding the existence of significant deficiencies” (emphasis added). I suppose that’s one way to describe it. But it kind of sounds like this: except for the thunderstorm, it was a bright and sunny day.

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