SAN DIEGO—Leap Wireless International Inc. joined several other wireless operators in announcing financial restatements—though the company said it expects the adjustments will result in improved financials.
Leap said it plans to restate results for the final five months of 2004 after it emerged from Chapter 11 bankruptcy in August, and the first nine months of 2005. The company said it found the mistakes while preparing its 2005 taxes.
Leap expects that the adjustments will decrease its income tax expenses and improve its net income. The company said the errors occurred in calculations of the tax bases of some of its wireless licenses and deferred taxes associated with goodwill, the amount a company pays for something versus what it is actually worth.
Leap estimated that the mistakes would result in:
- More than $100,000 in additional goodwill for both periods.
- Additional long-term liabilities between $85,000 to $135,000 in each of the periods.
- Decreases in income tax of $500 to $1,500 for the 2004 period, and $16,000-$19,000 for the 2005 period, resulting in those amounts increasing net income.
- Net income per diluted share rising up to two cents for the 2004 period and between 26 and 31 cents for the 2005 period.
Leap said it plans to release fourth quarter and full year 2005 results next week.
U.S. Cellular Corp. has been working since November on financial restatements dating back to 2000, and Shenandoah Telecommunications Inc. recently announced that it would correct its results for 2003, 2004 and the first three quarters of 2005 by about $2.1 million.