brickcityman (< 20)

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Green Mountain... or Red Valley?

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November 19, 2010 – Comments (4) | RELATED TICKERS: GMCR , FRA , UUD

Shares halted in extended hours... Appears they will have to restate earnings over some period...

Never have liked this stock/company... K-cup coffe is a step above a vending machine but with much higher costs. Bought up a failing coffeeshop chain for who knows what reason.

Anyway lets hear it apologists? Was it just a little too much caffeine or did they let someone roast the books?

4 Comments – Post Your Own

#1) On November 19, 2010 at 5:00 PM, brickcityman (< 20) wrote:

Figures... Restatement negatively impacts stated earnings (but not much balance sheet impact supposedly) and the stock jumps by 11%.... Because that makes TOTAL sense.

Was this good news (e.g. assuming this means SEC investigation will be closed and has priced in worse outcome)? Or is this the old "any publicity is good publicity" effect at work?

... end this now before I am forced to make a "bean counters" joke.

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#2) On November 19, 2010 at 5:11 PM, Option1307 (30.52) wrote:

The estimated impact of these items for the restatement periods is expected to reduce cumulative net income by approximately $6.1 - $6.5 million and cumulative diluted income per share by approximately $0.04 - $0.05 per share (see here).

While the "errors" are really not that big considering the company reported EPS of ~0.40 (now adjusted to 0.38) last quarter alone, it definitely strikes me as an indication of piss poor managment skills.

In accordance with Section 404 of the Sarbanes-Oxley Act of 2002, the Company’s management has been assessing the effectiveness of the Company’s internal controls over financial reporting and disclosure controls. Based on this assessment, the Company expects to report a material weakness in the Company’s internal controls over financial reporting, and, therefore, conclude that internal controls over financial reporting as of September 25, 2010 are not effective.

Gee ya think?

Although the assessment is not yet complete, management expects to recommend to the audit committee of the Company’s board of directors certain remedial actions that include (i) the addition of more experienced accounting staff at the Company’s enterprise and business unit levels, (ii) a formal training program for all accounting and finance personnel, so that they remain current with accounting rules, regulations and trends (See here)...

Ha ha ha wtf kind of business are you running? You don't even have an "experienced accounting staff".

This may not end up being much, but I'm sure glad I don't own any shares of GMCR. Managment is essentially saying they don't run a tight ship, no bueno!

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#3) On November 19, 2010 at 7:34 PM, Mstinterestinman (43.50) wrote:

Management seems to be a train wreck and you still have earnings coming up I wouldnt be shocked if they miss badly and the stock gets crushed. I liked this company before the accounting issues surfaced too many other good companies out there not deserving of my money.

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