Nash Finch Gets Debt Default Notice
MINNEAPOLIS - Nash Finch Co. said on Friday it was notified that it is in default on its $165 million notes because it did not file financial reports on time.
Minneapolis-based Nash Finch, under SEC and internal investigations over how it accounts for certain vendor charges, said unless it files the financial reports with the SEC within 30 days it will also be in default under its bank credit facility.
Nash Finch said it was in discussions with its bank lenders over a waiver in case of default, but there can be no assurances that it will get a waiver.
However, the company said given its strong operating cash flow it does not expect to borrow from the credit line for at least the next 30 days, provided that its trade credit remains substantially unaffected.
Nash Finch, which last week warned that it could face liquidity issues if the SEC does not agree with its accounting methods, said the default involves its $165 million, 8-1/2 percent senior subordinated notes due 2008.
Nash Finch has not filed its quarterly report for the period ended Oct. 5 because of an internal investigation into accounting practices. However, the company released preliminary results for fiscal 2002 on Friday. The unaudited results -- prepared assuming its accounting methods are correct -- show total revenues of $3.9 billion in fiscal 2002, compared with $4.0 billion in the prior year. It reported full-year net earnings of $29.7 million, or $2.46 per share, compared with $21.2 million, or $1.78 per share, in 2001.
For the quarter ended Oct. 5, it reported net earnings of $7.3 million, or 61 cents per share, compared with $6.0 million, or 50 cents per share, in the same quarter of 2001.
For the quarter ended Dec. 28, it reported net earnings of $8.4 million, or 70 cents per share, compared with $6.7 million, or 55 cents per share, in the prior year's quarter.
"We continue to believe our accounting has been correct and, as I have said previously, we hope that the (SEC) will provide the necessary reassurance to allow us to move forward expeditiously with the release of our financial results," Ron Marshall, Nash Finch's chief executive, said in a statement.
Minneapolis-based Nash Finch, under SEC and internal investigations over how it accounts for certain vendor charges, said unless it files the financial reports with the SEC within 30 days it will also be in default under its bank credit facility.
Nash Finch said it was in discussions with its bank lenders over a waiver in case of default, but there can be no assurances that it will get a waiver.
However, the company said given its strong operating cash flow it does not expect to borrow from the credit line for at least the next 30 days, provided that its trade credit remains substantially unaffected.
Nash Finch, which last week warned that it could face liquidity issues if the SEC does not agree with its accounting methods, said the default involves its $165 million, 8-1/2 percent senior subordinated notes due 2008.
Nash Finch has not filed its quarterly report for the period ended Oct. 5 because of an internal investigation into accounting practices. However, the company released preliminary results for fiscal 2002 on Friday. The unaudited results -- prepared assuming its accounting methods are correct -- show total revenues of $3.9 billion in fiscal 2002, compared with $4.0 billion in the prior year. It reported full-year net earnings of $29.7 million, or $2.46 per share, compared with $21.2 million, or $1.78 per share, in 2001.
For the quarter ended Oct. 5, it reported net earnings of $7.3 million, or 61 cents per share, compared with $6.0 million, or 50 cents per share, in the same quarter of 2001.
For the quarter ended Dec. 28, it reported net earnings of $8.4 million, or 70 cents per share, compared with $6.7 million, or 55 cents per share, in the prior year's quarter.
"We continue to believe our accounting has been correct and, as I have said previously, we hope that the (SEC) will provide the necessary reassurance to allow us to move forward expeditiously with the release of our financial results," Ron Marshall, Nash Finch's chief executive, said in a statement.