February 12, 2009
Company to Restate its Cash Flow Statement and Balance Sheet for the First Quarter Fiscal 2008
Brad Miller, Chief Financial Officer of AspenTech, said "The review process related to the Company’s second and third quarter fiscal 2008 results has taken significantly longer than originally expected primarily as a result of extensive manual testing, including in areas with internal control weaknesses. In the final stage of preparing our required quarterly SEC filings, we discovered errors related to classifications in the cash flow statement of our previously filed first quarter fiscal 2008 results as well as the adjustment we made to the accumulated deficit as of July 1, 2007."
In restating cash flows for the first quarter of fiscal 2008, the Company currently estimates that repayments of secured borrowings were approximately $7.8 million lower than originally reported, while the repayments were approximately $9.1 million higher than originally reported in the first quarter fiscal 2007. Offsetting adjustments will be reflected in cash flows from operations for both respective quarters. This correction does not impact ending cash balances or any change in total cash flows at the end of any reporting period.
The Company also expects to make adjustments to its consolidated statements of cash flows to more appropriately reflect certain non-cash operating activities, which will not have any impact on net cash flows from operations for any period. The Company also identified an error in adjustments made to the accumulated deficit as of July 1, 2007, when it adopted FASB Interpretation No. 48. The Company had previously recognized an increase of $3.0 million in the liability for unrecognized tax benefits, with an offsetting increase to the accumulated deficit upon adoption. The Company currently believes it is appropriate to reverse this $3.0 million liability and the offsetting increase in accumulated deficit as of July 1, 2007.
A current report on Form 8-K has been filed with the Securities and Exchange Commission relating to the First Quarter of Fiscal 2008. The Company will file an amendment to the First Quarter 10-Q for the three months ended September 30, 2007 that will correct each of the errors identified and discussed above.
AspenTech is a leading global supplier of software that optimizes process manufacturing – including oil and gas, petroleum, chemicals, pharmaceuticals and other industries that manufacture and produce products from a chemical process. With integrated aspenONE solutions, process manufacturers can implement best practices for optimizing their engineering, manufacturing and supply chain operations. As a result, AspenTech customers are better able to increase capacity, improve margins, reduce costs and become more energy efficient. To see how the world’s leading process manufacturers rely on AspenTech to achieve their operational excellence goals, visit www.aspentech.com.
Forward Looking Statements This press release may contain forward-looking statements for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Actual results may vary significantly from AspenTech’s expectations based on a number of risks and uncertainties, including, without limitation: fluctuations in AspenTech’s quarterly revenues, operating results and cash flow; difficulty in predicting quarterly revenue levels and operating results due to AspenTech’s lengthy sales cycle; economic downturn in the highly cyclical oil and gas, chemicals, petrochemicals and petroleum industries from which AspenTech derives a majority of its total revenues; substantial damages and expenses AspenTech might incur as the result of securities and derivative litigation and government investigations based on AspenTech’s restatement of its consolidated financial statements due to AspenTech’s prior software accounting practices; a determination that AspenTech has failed to comply with its existing consent decree with the Federal Trade Commission; failure to remedy effectively material weaknesses identified by AspenTech in its internal control over financial reporting; risks associated with the delisting of AspenTech’s common stock from The NASDAQ Stock Market; failure to manage international operations effectively, or failure to address the challenges associated with transacting business internationally; competition from software offered by current competitors and new market entrants, as well as from internally developed solutions; failure to develop new software products or enhance existing products and services; new accounting standards or interpretations of existing accounting standards that could adversely affect AspenTech’s operating results; failure to develop or maintain strategic alliance relationships; failure to raise capital when needed; and other risk factors described from time to time in AspenTech’s periodic reports filed with the Securities and Exchange Commission. AspenTech cannot guarantee any future results, levels of activity, performance, or achievements. AspenTech expressly disclaims any current intention to update forward-looking statements after the date of this press release.
Source: Aspen Technology, Inc.