Flowserve Receives Inquiry
Flowserve receives informal inquiry from SEC in response to recent announcement to restate financial statements.
Flowserve Corp. Friday announced that the Securities and Exchange Commission initiated an informal inquiry related to the Feb. 3, 2004 announcement to restate its financial statements. The company plans to fully cooperate with the commission's inquiry.
Flowserve Corp. (NYSE:FLS) is one of the world's leading providers of industrial flow management services. Operating in 56 countries, the company produces engineered and industrial pumps for the process industries, precision mechanical seals, automated and manual quarter-turn valves, control valves and valve actuators, and provides a range of related flow management services.
SAFE HARBOR STATEMENT: This news release contains various forward-looking statements and includes assumptions about Flowserve's future market conditions, operations and results. These statements are based on current expectations and are subject to significant risks and uncertainties. They are made pursuant to safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Among the many factors that could cause actual results to differ materially from the forward-looking statements are: material adverse events in the national financial markets; changes in the already competitive environment for the company's products or competitors' responses to Flowserve's strategies; the company's ability to integrate past and future acquisitions into its management operations; political risks, military actions or trade embargoes affecting customer markets, including continuing conflict in Iraq with its potential impact on Middle Eastern markets and global oil producers; the health of the company's various customer industries, including the petroleum, chemical, power and water industries; economic turmoil in areas outside the United States; global economic growth; unanticipated difficulties or costs associated with new systems, including software; the company's relative geographical profitability and its impact on the company's utilization of foreign tax credits; and the recognition of significant expenses associated with adjustments to realign the company's facilities and other capabilities with its strategies and business conditions, including, without limitation, expenses incurred in restructuring the company's operations and the cost of financing, including increases in interest costs, and litigation developments. Flowserve undertakes no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise.
As a result of the company's announcement to conduct a re-audit of its financial statements for fiscal years 2000, 2001 and 2002, and for the nine months ending Sept. 30, 2003, the company may be subject to inquiry or investigation by governmental authorities, including the Securities and Exchange Commission. In the event that the company is subject to such an inquiry or investigation, the company will fully cooperate with such inquiry or investigation. There is risk that such an inquiry or investigation could result in substantial costs and divert management attention and resources from the company's business, which could adversely affect its business.
In the past, private securities class action litigation has been brought against companies after events occurred that caused volatility in the market prices. Due to the announcement of the re-audit of Flowserve's financial statements, there is risk that additional private securities litigation may be brought against the company. There is risk that such additional litigation could result in substantial costs and divert management attention and resources from the company's business, which could adversely affect its business.
Source: Flowserve Corporation