UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT: May 15, 2007
(Date of earliest event reported)
(Date of earliest event reported)
POWELL INDUSTRIES, INC.
(Exact Name of Registrant as Specified in Its Charter)
| Delaware | 001-12488 | 88-0106100 | ||
| (State or other jurisdiction of incorporation or organization) |
(Commission File Number) | (I.R.S. Employer Identification Number) |
||
| 8550 Mosley Drive | ||||
| Houston, Texas | 77075-1180 | |||
| (Address of Principal Executive Offices) |
(Zip Code) |
(713) 944-6900
(Registrant’s Telephone Number, Including Area Code)
(Registrant’s Telephone Number, Including Area Code)
N/A
(Former Name or Former Address, if Changed Since Last Report)
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17CFR230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17CFR240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Action
(17CFR240.14D-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act
(17CFR240.13e-4(c))
Item 2.02 — Results of Operations and Financial Condition.
On
May 21, 2007, the Audit Committee and management of Powell
Industries, Inc. (the “Company”), based on their final
review of accounting errors as described in the Company’s
previously filed Form 8-K filed on April 16, 2007,
concluded that the Company’s consolidated financial statements
for the quarter ended July 31, 2005, the year ended
October 31, 2005, the quarters ended January 31,
April 30 and July 31, 2006, the eleven-month transition
period ended September 30, 2006 and the quarter ended
December 31, 2006 may no longer be relied upon as the result of an ongoing
review as more fully described in Item 4.02 below. On May 21, 2007, the Company announced that it
would hold a conference call on May 30, 2007 to discuss its second quarter results. A copy of the
press release is attached hereto as Exhibit 99.1.
The information in this Item 2.02 of this Current Report is being furnished pursuant to Item
2.02 of Form 8-K and, according to general instruction B.2. thereunder, the information in this
Item 2.02 of this Current Report shall not be deemed “filed” for the purposes of Section 18 of the
Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section. The
information in this Item 2.02 of this Current Report shall not be incorporated by reference into
any registration statement pursuant to the Securities Act of 1933.
Item 3.01 — Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard;
Transfer of Listing.
On May 15, 2007, the Company received a written Staff Determination from the Nasdaq Stock
Market stating that the Company is not in compliance with Nasdaq’s Marketplace Rule 4310(c)(14)
because it did not timely file its quarterly report on Form 10-Q for the quarter ended March 31,
2007 and, therefore, that its common stock is subject to delisting from The Nasdaq Global Market.
On May 10, 2007, the Company filed a Form 12b-25 with the Securities and Exchange Commission
relating to the late filing of the Form 10-Q. The Company issued a press release on May 21, 2007
disclosing its receipt of this notice from Nasdaq. A copy of the press release is attached hereto
as Exhibit 99.2 and is incorporated herein by reference.
The
Company has requested a hearing before a Nasdaq Listing Qualifications Panel to review the
Staff Determination. There can be no assurance that the panel will grant the Company’s request for
continued listing. Pending a decision by the panel, the Company’s common stock will continue to be
listed on Nasdaq. The Company intends to file its quarterly report for the quarter ended March 31,
2007 by May 25, 2007 which the Company believes would bring it into compliance with Nasdaq
Marketplace rules.
Item 4.02 — Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or
Completed Interim Review.
As previously disclosed, on April 13, 2007, the Audit Committee of the Company’s Board of
Directors and the Company’s management concluded that the Company’s consolidated financial
statements for the first quarter of fiscal 2007 ended December 31, 2006 and for the eleven-month
transition period ended September 30, 2006 and one or more fiscal quarters in such transition
period, including those for each of the fiscal quarters of 2006, should no longer be relied upon
due to accounting errors found at one of its divisions. On May 21, 2007, the Audit Committee and
management concluded that such accounting errors are also reflected in the Company’s consolidated
financial statements for the third and fourth quarters of 2005, and that the consolidated financial
statements for the fiscal year ended October 31, 2005 and for the third quarter of 2005 ended July
31, 2005 should no longer be relied upon due to such accounting errors.
As previously disclosed, the accounting errors occurred at one of the Company’s domestic
divisions and were discovered in the course of a review of the financial results of such division.
Specifically, the Company did not have effective review and reconciliation procedures to prevent or
detect erroneous manual entries recorded in the received goods payable and work-in-process
inventory accounts. This control deficiency will result in the restatement of the Company’s fiscal
2006 and 2005 annual consolidated financial statements, the interim consolidated financial
statements for each of the quarters within the fiscal year 2006, and the last two quarters of
fiscal year 2005, and the interim consolidated financial statements for the quarter ended December
31, 2006.
Based on current information, the effect of the issues identified at this domestic division
would cause an increase in cost of sales resulting in a reduction to net income and earnings per
share in the following amounts per fiscal year and in the aggregate:
| 2005 | 2006 | 2007 | Total | |||||||||||||
Reduction to net
income
|
$0.4 million | $1.4 million | $0.9 million | $2.7 million | ||||||||||||
Reduction to
earnings per
diluted share
|
$ | 0.04 | $ | 0.13 | $ | 0.08 | $ | 0.25 | ||||||||
In addition, Inventory and Accounts Payable balances reflected in the previously reported
balance sheets for each of the quarters from July 31, 2005 through December 31, 2006, inclusive,
contained in such financial statements will also be restated.
Management
has determined that there was a material weakness in the
Company’s internal controls over financial reporting at September 30, 2006, which will be discussed
in more detail in the Company’s amended filings to be filed in connection with the restatement of
the affected financial statements.
The
Company announced today that it has completed its review of the
accounting errors described above. The Company plans to restate
its financial statements and its assessment of internal controls over financial reporting as
appropriate. The Company intends to file its Form 10-K/A for the
transition period ended September 30, 2006, its Form 10-Q/A
for the quarter ended December 31, 2006 and its Form 10-Q for the quarter ended
March 31, 2007 by May 25, 2007.
The management of the Company and the Audit Committee of the Board of Directors of the Company
have discussed the matters contained herein with the Company’s registered independent public
accounting firm.
Item 9.01 — Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit | ||
| Number | Description | |
99.1
|
Press Release dated May 21, 2007. | |
99.2
|
Press Release dated May 21, 2007. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned thereunto duly authorized.
| POWELL INDUSTRIES, INC. |
||||
| Date: May 21, 2007 | By: | /s/ DON R. MADISON | ||
| Don R. Madison | ||||
| Executive Vice President Chief Financial and Administrative Officer (Principal Accounting and Financial Officer) |
||||
EXHIBIT
INDEX
| Exhibit | ||
| Number | Description | |
99.1
|
Press Release dated May 21, 2007. | |
99.2
|
Press Release dated May 21, 2007. |
Exhibit 99.1
 |
Press Release | |||
| Contacts: | Don R. Madison, CFO | |||
FOR IMMEDIATE RELEASE
|
Powell Industries, Inc. | |||
| 713-947-4422 | ||||
| Ken Dennard / ksdennard@drg-e.com | ||||
| Karen Roan / kcroan@drg-e.com | ||||
| DRG&E / 713-529-6600 | ||||
POWELL INDUSTRIES RECEIVED NASDAQ NOTICE
HOUSTON — MAY 21, 2007 — Powell Industries, Inc. (NASDAQ: POWL), a leading manufacturer of
equipment and systems for the management and control of electrical energy and other critical
processes, today announced that the Company has now completed its review of certain accounting
errors discovered at one of its domestic divisions as previously announced on April 13, 2007.
Based on the conclusion of its review, cumulative net income will be reduced by approximately $2.7
million, or $0.25 per diluted share; and the Company is in the process of preparing restated
financial statements. The restatements will reduce net income for the fiscal year 2005, 2006 and
the first quarter of fiscal year 2007 by approximately $0.4 million, $1.4 million and $0.9 million,
respectively; and diluted earnings per share for the respective periods will be reduced by
approximately $0.04, $0.13 and $0.08. The company intends to file the above-mentioned restated
financial statements and its Form 10-Q for the quarter ended March 31, 2007 by May 25, 2007.
As expected on May 15, 2007 in accordance with NASDAQ procedures, the Company received a
NASDAQ Staff Determination letter, indicating that the Company is not in compliance with the filing
requirements for continued listing as set forth in Marketplace Rule 4301(c)(14) due to the delayed
filing of the Company’s Form 10-Q for the fiscal 2007 second quarter ended March 31, 2007. In
response to the letter, the Company has requested a hearing before the NASDAQ Listing
Qualifications Panel to review the Staff Determination. This hearing will take place no later than
45 days from today. Pending a decision by the Panel, Powell Industries shares will remain listed
on the NASDAQ Stock Market.
Powell Industries, Inc., headquartered in Houston, designs, manufactures and packages systems
and equipment for the control, distribution and management of electrical energy and other dynamic
processes. Powell provides products and services to large industrial customers
such as utilities, oil and gas producers, refineries, petrochemical plants, pulp and paper
producers, mining operations, commuter railways and other vehicular transportation facilities.
For more information, please visit www.powellind.com.
Any forward-looking statements in the preceding paragraphs of this release are made pursuant
to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors
are cautioned that such forward-looking statements involve risks and uncertainties in that actual
results may differ materially from those projected in the forward-looking statements. In the
course of operations, we are subject to certain risk factors, including but not limited to the
results of the Company’s internal investigation relating to the accounting errors, competition and
competitive pressures, sensitivity to general economic and industrial conditions, international
political and economic risks, availability and price of raw materials and execution of business
strategy. For further information, please refer to the Company’s filings with the Securities and
Exchange Commission, copies of which are available from the Company without charge.
# # #
Exhibit 99.2
|
Press Release | |||
| Contacts: | Don R. Madison, CFO | |||
FOR IMMEDIATE RELEASE
|
Powell Industries, Inc. | |||
| 713-947-4422 | ||||
| Ken Dennard / ksdennard@drg-e.com | ||||
| Karen Roan / kcroan@drg-e.com | ||||
| DRG&E / 713-529-6600 | ||||
POWELL INDUSTRIES ANNOUNCES FISCAL 2007
SECOND QUARTER CONFERENCE CALL SCHEDULE
SECOND QUARTER CONFERENCE CALL SCHEDULE
HOUSTON — MAY 21, 2007 — Powell Industries, Inc. (NASDAQ: POWL), a leading manufacturer of
equipment and systems for the control, distribution and management of electrical and other dynamic
processes, today announced that it has scheduled a conference call, which will be broadcast live
over the Internet, for Wednesday, May 30, 2007 at 11:00 a.m. eastern time to discuss its fiscal
2007 second quarter results ended March 31, 2007.
| What: | Powell Industries Second Quarter Earnings Conference Call |
|
| When: | Wednesday, May 30, 2007 — 11:00 a.m. eastern time /10:00 a.m. central time |
|
| How: | Live via phone by dialing 303-262-2142 and asking for the Powell Industries call at
least 10 minutes prior to the start time, or live over the Internet by logging on to
the web at the address below |
|
| Where: | http://www.powellind.com |
A telephonic replay of the conference call will be available through June 6, 2007 and may be
accessed by calling 303-590-3000 using passcode 11090599. A web cast archive will also be
available at www.powellind.com shortly after the call and will be accessible for
approximately 90 days. For more information, please contact Donna Washburn at DRG&E at 713-529-6600
or email dmw@drg-e.com.
Powell Industries, Inc., headquartered in Houston, designs, manufactures and packages systems
and equipment for the control, distribution and management of electrical energy and other dynamic
processes. Powell provides products and services to large industrial customers such as utilities,
oil and gas producers, refineries, petrochemical plants, pulp and paper producers, mining
operations, commuter railways and other vehicular transportation facilities. For more
information, please visit www.powellind.com.
# # #