OTTAWA, April 7 /CNW/ - Thermal Energy International Inc. (TSXV: TMG) (www.thermalenergy.com) ("Thermal Energy" or the "Company") today announced that it intends to restate its financial statements and management's discussion and analysis ("MD&A") for the year ended May 31, 2010.
The restatement is required as a result of an error in the calculation of the value of goodwill and intangible assets acquired on the acquisition of Gardner Energy Management Limited ("GEM") at the balance sheet date. Thermal Energy's financial statements filed since the GEM acquisition have calculated the value of GEM's goodwill and intangible assets based on the historical exchange rate as at the purchase date. However, since GEM is a self-sustained foreign operation for accounting purposes, its goodwill and intangible assets should be revalued at the current exchange rate as of each balance sheet date. Based on the Company's preliminary assessment, the impacts of the resulting adjustments on the financial statements for the year ended May 31, 2010 are as follows:
| |
May 31, 2010 |
May 31, 2009 |
| |
As previously reported |
Restated |
As previously reported |
Restated |
| |
$ |
$ |
$ |
$ |
| Intangible assets |
1,321,542 |
995,448 |
1,508,042 |
1,336,172 |
| Goodwill |
3,630,824 |
2,789,879 |
3,449,799 |
3,093,626 |
| Total Assets |
9,488,831 |
8,321,792 |
12,550,430 |
12,022,387 |
| |
|
|
|
|
| Accumulated other comprehensive loss |
(197,650) |
(1,364,689) |
(77,443) |
(605,486) |
| Total liabilities and shareholders' equity |
9,488,831 |
8,321,792 |
12,550,430 |
12,022,387 |
| |
|
|
|
|
| Net loss for the year |
(3,071,851) |
(3,071,851) |
(3,205,377) |
(3.205,377) |
| Unrealized losses on translating financial statements of self-sustaining foreign operations for the year |
(120,207) |
(759,203) |
(77,443) |
(605,486) |
| Comprehensive loss for the year |
(3,192,058) |
(3,831,054) |
(3,282,820) |
(3,810,863) |
As shown above the expected adjustments are all non-cash in nature and do not have any impact on net loss. The foregoing preliminary assessment of the adjustments has been prepared by the Company's management and remains subject to audit. Thermal Energy is currently working with its auditors to complete the restatement of the financial statements for the year ended May 31, 2010, which the Company aims to file on www.SEDAR.com by April 15, 2011.
The Company does not intend to restate any financial statements or MD&A other than the annual statements and MD&A for the year ended May 31, 2010. The restated MD&A for the year ended May 31, 2010 will describe the impacts such adjustments would have had, if any, to prior quarterly results. Thermal Energy's unaudited statements for the Company's third quarter ending February 28, 2011 will reflect the appropriate valuation methodology and the MD&A for such quarter will describe the impacts such adjustments would have had, if any, to the results for the first two quarters of fiscal year 2011.
About Thermal Energy International Inc.
With offices in Ottawa, Canada and Bristol UK, Thermal Energy International Inc. is an innovative clean technology company providing a variety of proprietary and proven energy efficiency, emission reduction, water efficiency and bioenergy products and solutions to the industrial, commercial and institutional markets worldwide. Thermal Energy's products include; GEM® - Steam traps and condensate return systems, FLU-ACE® - Direct contact condensing heat recovery, and Dry RexTM - Low temperature biomass drying systems. Thermal Energy International Inc. is also a fully accredited professional engineering firm, and offers advanced process and applications engineering services. FLU-ACE®, GEM®, DRY-REX®, THERMALONOx®, and THERMAL AUD® are trademarks of Thermal Energy International Inc.
To find out more about Thermal Energy International Inc. (TSX-V: TMG), visit our website at http://www.thermalenergy.com.
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