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Sunbeam restates results
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November 12, 1998: 8:24 p.m. ET
Appliance maker warns '98 results to be hurt as well; SEC probe continues
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NEW YORK (CNNfn) - Sunbeam Corp. Thursday restated financial reports for both 1996 and 1997 and warned that additional restructuring charges would hurt 1998 results.
In a filing with the Securities and Exchange Commission, Sunbeam also disclosed that it had been served with another subpoena by the SEC on Nov. 4 to provide further documents related to the agency's investigation of Sunbeam's accounting practices.
Sources close to the federal agency have said the SEC is looking into whether bookkeepers at Sunbeam resorted to accounting gimmicks to make the company's 1997 earnings appear stronger than they actually were.
Sunbeam in June fired its controversial chief executive officer, "Chainsaw" Al Dunlap, after two years of massive job cuts and other restructuring failed to turn the company around.
In its filing Thursday, Sunbeam revised its 1996 operating loss to $33.9 million, compared to a previously reported profit of $10.8 million. The 1997 results were revised to show an operating profit of $6.8 million versus an earlier reported $6.4 million loss.
Sunbeam said it would file restated results for the first three quarters of 1998 in the next several weeks. However, it warned overall 1998 results would be hurt by a variety of factors, including a provision for excess inventory, a change in management, changes in business operations resulting from acquisitions made in 1998, higher interest costs related to higher debt levels, costs associated with litigation and restructuring, as well as costs related to Year 2000 issues.
The company estimated it will need to spend $50 million on Year 2000 issues. As of last year, the company had spent less than $1 million. Of the remaining estimated expenditures, Sunbeam expects to spend 25 percent in 1998 and the rest in 1999.
Sunbeam stock (SOC) closed Thursday down 1/16 at 7-1/4 in trading on the New York Stock Exchange.
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Sunbeam
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