, maker of such well-known name brands as Aunt Jemima frozen foods and Mrs. Paul's fish sticks, said Monday that it has filled several positions left open by a mid-February executive exodus, and that it plans to restate financial results for 1998 and 1999 to remedy improperly-reported earnings for those years.
St. Louis-based Aurora said that the restatement will decrease previously reported pre-tax earnings for the first three quarters of 1999 by about $43.3 million, and by $38.3 million for the third and fourth quarters of 1998.
The restatements are expected to bring the company closer to ending an investigation that was initiated after the company's board met with its auditor,
Shares of Aurora were up 7/16, or 14.6%, at 3 7/16 in early trading Monday. (Aurora closed up 3/8, or 13%, at 3 3/8).
The accounting problems were due to the way that Aurora reported on allowances for trade promotions, such as two-for-one deals and grocery-shelf centerpieces, or coupons. Aurora apparently deferred some revenue losses due to trade promotions to later quarters.
"The restatement closes a disappointing chapter for the company," said Richard C. Dresdale, the company's acting chairman and president of
, which, along with
McCown De Leeuw & Co.
and other founding investors own about 65% of the company's common stock.
As the investigation began in February, several of the company's key executives resigned, including chairman and chief executive Ian Wilson, vice chairman James Ardrey, executive vice president Ray Chung and chief financial officer M. Laurie Cummings.
Aurora announced Monday that it has filled two of those positions.
James T. Smith, former president and CEO of
frozen foods, will become president and CEO of Aurora. Smith is widely credited with more than doubling revenues during his tenure at ConAgra's frozen food business, which includes brands such as Healthy Choice, Banquet and Marie Callender's.
The company also hired Christopher T. Sortwell, former executive vice president and CFO of
, to become Aurora's executive vice president and CFO.
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