Brunswick Corp. said an accounting error will result a charge against earnings of up to $135 million this year. The Lake Forest, IL-based company said that financial filings for the first nine months of 2008 should “no longer be relied on” because the company incorrectly valued an allowance against deferred taxes. The company said it discovered the error while compiling four-quarter results.
Brunswick said correcting the error and reissuing financial reports will result in a non-cash charge of $110 million to $135 million.
“The company and its auditors have reached a preliminary conclusion that an additional valuation allowance should have been recorded at Sept. 27, 2008,” the company said in filing with the U.S. Securities and Exchange Commission.
In a separate press release issued Friday, Brunswick also noted Friday that it had reached agreement with lenders on an amendment to its revolving-credit facility, which ensures the company short-term funding if needed.
Under the amendment, it was converted into a secured, asset-based $400 million facility, backed by Brunswick receivables, inventory, machinery and equipment.
The amendment, which will be in effect through May 2012, “provides access to an important source of liquidity, should we need to supplement our own vigorous cash-management efforts, to fund anticipated working capital needs going forward,” said Chairman and Chief Executive Dustan McCoy.
Under the amendment, it was converted into a secured, asset-based $400 million facility, backed by Brunswick receivables, inventory, machinery and equipment.
The amendment, which will be in effect through May 2012, “provides access to an important source of liquidity, should we need to supplement our own vigorous cash-management efforts, to fund anticipated working capital needs going forward,” said Chairman and Chief Executive Dustan McCoy.
Brunswick makes Mercury and Mariner outboard engines; Mercury MerCruiser sterndrives and inboard engines; MotorGuide trolling motors; Teignbridge propellers; Albemarle, Arvor, Bayliner, Bermuda, Boston Whaler, Cabo Yachts, Crestliner, Cypress Cay, Harris, Hatteras, Kayot, Lowe, Lund, Maxum, Meridian, Örnvik, Princecraft, Quicksilver, Rayglass, Sea Ray, Sealine, Triton, Trophy, Uttern and Valiant boats; Attwood marine parts and accessories; Land N Sea, Kellogg Marine, Diversified Marine and Benrock parts and accessories distributors; IDS dealer management systems; Life Fitness, Hammer Strength and ParaBody fitness equipment; Brunswick bowling centers, equipment and consumer products; Brunswick billiards tables; and Dynamo, Tornado and Valley pool tables, Air Hockey and foosball tables.
