Business Context and Reporting Period
This Form 8-K is filed by Platform Specialty Products Corporation (not Element Solutions Inc) on May 5, 2016. The filing primarily addresses the restatement of financial statements for the quarter ended March 31, 2015, and references the release of financial results for the quarter ended March 31, 2016, which occurred on May 9, 2016.
Key Financial Metrics
The filing text does not provide specific values for revenue, profit, cash flow, margins, debt, or liquidity for the current or prior periods. These figures are contained in attached exhibits (Exhibit 99.1 and 99.2) which are not included in the source text. The filing notes that the company utilizes non-GAAP measures including pro forma adjusted diluted earnings per share, adjusted EBITDA, and organic sales.
Material Changes and Restatements
Management concluded that the Q1 2015 Form 10-Q should no longer be relied upon due to an error of approximately $73 million related to goodwill and foreign currency translation adjustments from the acquisition of Arysta LifeScience Limited. This error resulted in an understatement of cash flows provided by operating activities and cash flows used in investing activities by approximately $73 million. The error had no impact on the net decrease in cash and cash equivalents or cash balances as of March 31, 2015. The restatement does not impact previously reported non-GAAP measures for 2015.
Outlook, Risks, and Management Commentary
The error was attributed to material weaknesses in internal controls described in the company's 2015 Annual Report. Management is implementing remediation initiatives, including hiring personnel with appropriate accounting knowledge and experience. However, the company states it cannot be certain that these steps will successfully remediate the material weaknesses or that other deficiencies will not be discovered. The restatement details will be fully described in the Q1 2016 Form 10-Q.
Investor Verification Checklist
- Verify the specific Q1 2016 revenue and earnings figures in the attached press release (Exhibit 99.1).
- Review the detailed restatement of Q1 2015 financial statements in Exhibit 99.3.
- Confirm the status of remediation efforts regarding internal control material weaknesses in the upcoming Q1 2016 Form 10-Q.
- Clarify the discrepancy between the registrant name in the metadata (Element Solutions Inc) and the filing (Platform Specialty Products Corporation).