| RESTATEMENT OF FINANCIAL STATEMENTS |
3. RESTATEMENT OF UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
The accompanying unaudited consolidated financial statements as of and for the three and nine months ended September 30, 2016, have been restated to correct AMAK’s accounting error which reduced our equity in earnings of AMAK by approximately $2.8 million and to record a $3.2 million gain resulting from an increase in our share of the net assets of AMAK based upon the July 2016 equity raise as described in Note 17. In the originally issued unaudited financial statements as of and for the three and nine months ended September 30, 2016, we did not record the correct equity in earnings or correctly record the gain (with a corresponding increase in our investment) in accordance with ASC 323-10-40-1.
The effects of the restatement are as follows:
| |
|
September 30, 2016 |
|
| |
|
(unaudited) |
|
| |
|
As Reported |
|
|
As Restated |
|
| |
|
(thousands of dollars) |
|
Consolidated Balance Sheets |
|
|
|
|
|
|
Investment in AMAK |
|
$ |
52,776 |
|
|
$ |
53,127 |
|
Total Assets |
|
|
283,155 |
|
|
|
283,506 |
|
Deferred Income Taxes |
|
|
22,817 |
|
|
|
22,941 |
|
Total Liabilities |
|
|
118,829 |
|
|
|
118,953 |
|
Retained Earnings |
|
|
109,066 |
|
|
|
109,293 |
|
Total Trecora Resources Stockholders’ Equity |
|
|
164,037 |
|
|
|
164,264 |
|
Total Equity |
|
|
164,326 |
|
|
|
164,553 |
|
Total Liabilities and Equity |
|
|
283,155 |
|
|
|
283,506 |
|
| |
|
Three Months Ended
September 30, 2016
|
|
|
Nine Months Ended
September 30, 2016
|
|
| |
|
(unaudited) |
|
| |
|
As Reported |
|
|
As Restated |
|
|
As Reported |
|
|
As Restated |
|
| |
|
(thousands of dollars) |
|
Consolidated Statements of Income |
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings (losses) of AMAK |
|
$ |
(2,089 |
) |
|
$ |
(2,089 |
) |
|
$ |
5,079 |
|
|
$ |
2,261 |
|
Gain on Additional Equity Issuance by AMAK |
|
|
- |
|
|
|
3,168 |
|
|
|
- |
|
|
|
3,168 |
|
Total other income (expense) |
|
|
(2,729 |
) |
|
|
439 |
|
|
|
14,863 |
|
|
|
15,213 |
|
Income before income taxes |
|
|
1,399 |
|
|
|
4,567 |
|
|
|
31,032 |
|
|
|
31,382 |
|
Income tax expense |
|
|
659 |
|
|
|
1,768 |
|
|
|
10,984 |
|
|
|
11,107 |
|
Net income attributable to Trecora Resources |
|
|
740 |
|
|
|
2,799 |
|
|
|
20,048 |
|
|
|
20,275 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per common share (dollars) |
|
$ |
0.03 |
|
|
$ |
0.12 |
|
|
$ |
0.82 |
|
|
$ |
0.83 |
|
Diluted earnings per common share (dollars) |
|
$ |
0.03 |
|
|
$ |
0.11 |
|
|
$ |
0.80 |
|
|
$ |
0.81 |
|
| |
|
September 30, 2016 |
|
| |
|
(unaudited) |
|
| |
|
As Reported |
|
|
As Restated |
|
| |
|
(thousands of dollars) |
|
Consolidated Statement of Stockholders’ Equity |
|
|
|
|
|
|
Net Income |
|
$ |
20,048 |
|
|
$ |
20,275 |
|
Retained Earnings |
|
|
109,066 |
|
|
|
109,293 |
|
Total |
|
|
164,037 |
|
|
|
164,264 |
|
Total Equity |
|
|
164,326 |
|
|
|
164,553 |
|
Consolidated Statements of Cash Flows |
|
|
|
|
|
|
Operating Activities |
|
|
|
|
|
|
Net income |
|
$ |
20,048 |
|
|
$ |
20,275 |
|
Deferred income taxes |
|
|
6,728 |
|
|
|
6,851 |
|
Equity in (earnings) loss of AMAK |
|
|
(5,079 |
) |
|
|
(2,261 |
) |
Gain on Additional Equity Issuance by AMAK |
|
|
- |
|
|
|
(3,168 |
) |
|