5. Not-So Great Lakes
Shares of the dredging company devolved into dreck last Friday, sinking 18% to $7.40 after the company announced it will restate its second- and third-quarter results due to accounting issues. Great Lakes apparently recorded some revenue for its demolition business in a way that did not comply with its own policies. The company revealed it overstated second-quarter revenue by $3.9 million and third-quarter revenue by $4.3 million. It also said it will review $5.6 million in questionable fourth-quarter sales.
"We are focusing on improving our internal controls. We will undergo a thorough retraining of our demolition segment personnel, we will add key personnel where needed and we will strengthen our procedures to ensure our divisions comply with all of our operational and accounting policies. We will be installing new estimating and project management software at the demolition segment," said Great Lakes CFO William Steckel.Basically, to drop the accounting jargon, the company that makes its money destroying things lit the dynamite, yet forgot to run. Well, that's not entirely true. Great Lakes said its President, COO and former CFO Bruce Biemeck is taking off in the wake of the accounting blow up. The bad news for Bruce is that he's not going to get very far away from the rubble he so desperately wants to leave behind. Class action suits by so-called "investor-rights law firms" are already piling up with lawyers placing Biemeck squarely at the center of their conspiracy theories. Yeah, it's going to be anything but a blast for Biemeck. Once the depositions get rolling, all those memories he wants to keep dead and buried are sure to be dredged up. Or, to lose the legal lingo, hold your ears because Biemeck could go Boom!
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