Founder of Equities Research. Stockdiagnostics Specialist

Founder of Equities Research. Stockdiagnostics Specialist
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Sunday, November 25, 2012

Mueller Water's Holiday Weekend 8K

The Stock Market is always shortened the week of Thanksgiving. Thursday the market is always closed and Friday the market closes at 1pm. What's always interesting is the disclosure made with the Securities & Exchange Commission after the close on Friday.

At 3:15pm est. after the market closed on Friday, Mueller Water Products, Inc.(NYSE:MWA) filed an 8-K with the SEC disclosing the following:

  • Item 4.02.
    Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review.
    On November 19, 2012, the Audit Committee of the board of directors of Mueller Water Products, Inc. (the “Company”), upon the recommendation of management, concluded that the Company's previously filed unaudited condensed consolidated statement of cash flows for the six months ended March 31, 2011 and nine months ended June 30, 2011 included in the Company's Quarterly Reports on Form 10-Q for the quarters ended March 31, 2012 and June 30, 2012, respectively, should no longer be relied upon because of errors in the classification of cash flows as between those from continuing operations and those from discontinued operations. These errors had no impact on any consolidated balance sheet, consolidated statement of operations, consolidated statement of changes in stockholders' equity, debt compliance covenant or employee compensation metric for any period. These errors also had no impact on any consolidated statement of cash flows for any period other than the six months ended March 31, 2011 and the nine months ended June 30, 2011.

    These errors related to the classification of deferred income taxes and retirement plans adjustments in determining cash flows from operating activities due to designating the Company's U.S. Pipe business segment as discontinued operations in the Company's consolidated financial statements during the quarter ended March 31, 2012. Cash flows from continuing operations were understated by $8.0 million and $10.0 million for the six months ended March 31, 2011 and nine months ended June 30, 2011, respectively. Cash flows from discontinued operations were overstated during these periods by these same amounts. Corrected unaudited condensed consolidated statements of cash flows for these periods are included as Exhibit 99.1. This information will also be presented in Note 22 of the notes to consolidated financial statements in the Company's Annual Report on Form 10-K for the year ended September 30, 2012, which is expected to be filed on or before November 29, 2012.

    The Audit Committee discussed these matters with Ernst & Young LLP, the Company's independent registered public accounting firm.

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