CALGARY, April 27 /CNW/ - EMM Energy Inc. ("EMM" of the "Company") (TSX Venture Exchange symbol: M) announces that, in conjunction with the preparation and filing of its December 31, 2009 year end audited financial statements and corresponding management's discussion & analysis ("MD&A"), it anticipates adjusting and re-stating certain financial information from its December 31, 2008 year end audited financial statements.
The anticipated re-statement is based primarily as a result of a $1.75 million payout adjustment on EMM's interest in the Ricinus well that was received by the Company on June 1, 2009 (subsequent other cost adjustments reduced the net amount to $1.6 million). This significant subsequent event occurred after a joint venture audit was completed on the Ricinus well payout account. The payout adjustment was for 2008, specifically from October 2008 when the initial payout was calculated, to June 2008 when the adjusted payout was calculated. EMM had not provided for an accrual of this payout amount when it completed its 2008 year end audited financial statements due to the uncertainty on timing, volumes, royalties and sulphur adjustments and insufficient information on the amount to be recovered. EMM's previous treatment of the payout adjustment is further discussed in the Company's MD&A for each the six month period ended June 30, 2009 and nine month period ended September 30, 2009, each available for review under the Company's profile at www.sedar.com.
After consulting with its auditors, it was determined that certain financial information for 2009 and the comparable figures for 2008 should be re-stated to more accurately reflect the actual timing of gas and sulphur production and volumes from the Ricinus well. Also factored into this determination were the high commodity prices in 2008 that distort the comparable figures for prices and volumes in 2008 and 2009. For purposes of clarity, the proposed adjustments are not anticipated to affect EMM's cash balances in any material way. The Company will account for the necessary adjustments and re-stated figures in its December 31, 2009 year end audited financial statements and corresponding MD&A, all anticipated to be filed on or before April 30, 2010.
Statements in this press release contain forward-looking information within the meaning of applicable securities law. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. In particular, forward-looking information in this press release includes, without limitation, statements with respect to the timing of the preparation and filing of the Company's financial statements and the anticipated adjustments to certain financial information. Readers are cautioned that assumptions used in the preparation of forward-looking information may prove to be incorrect. Although we believe that the expectations reflected in the forward-looking information are reasonable, there can be no assurance that such expectations will prove to be correct. Consequently, there is no representation that the actual results achieved will be the same, in whole or in part, as those set out in the forward-looking information.
Forward-looking information is based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors (many of which are beyond the control of EMM) that could cause actual events or results to differ materially from those anticipated in the forward-looking information. Some of the risks and other factors could cause results to differ materially from those expressed in the forward-looking information include, but are not limited to: the need to obtain required approvals from third parties and regulatory authorities; reliance on third parties (including the Company's auditors); and other factors. Readers are cautioned that this list of risk factors should not be construed as exhaustive.
The forward-looking information contained in this news release is expressly qualified by this cautionary statement. EMM does not undertakes any obligation to update or revise any forward-looking statements to conform such information to actual results or to changes in our expectations except as otherwise required by applicable securities legislation. Readers are cautioned not to place undue reliance on forward-looking information.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE EMM ENERGY INC.
For further information: For further information: EMM Energy Inc., Brian Boulton, President & CEO, T: (403) 213-3339