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April 18, 2008 |
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MAXXAM INC: Posts US$47 Million Net Loss in Year ended Dec. 31 MAXXAM Inc. reported a net loss of US$17.4 million for the fourth quarter ended Dec. 31, 2007, compared to a net loss of US$22.9 million for the same period a year ago. For 2007, MAXXAM Inc. reported a net loss of US$46.9 million compared to net income of US$374.4 million for 2006. The 2006 results included a net gain of US$430.9 million due to the cancellation of the company's interest in Kaiser Aluminum Corporation, resulting in the reversal of the company's losses in excess of its investment in Kaiser. On Jan. 18, 2007, Maxxam's affiliate, The Pacific Lumber company and its subsidiaries, including Scotia Pacific company LLC, filed for reorganization under Chapter 11 of the Bankruptcy Code. As a result, the company deconsolidated the Debtors' financial results beginning Jan. 19, 2007, and began reporting its investment in the Debtors using the cost method. Accordingly, the company's consolidated financial results for the three months ended Dec. 31, 2007, include no activity for the Debtors. The company's consolidated financial results for the twelve months ended Dec. 31, 2007, include the Debtors' financial results only for the period from Jan. 1, 2007, thru Jan. 18, 2007. Annual Report Filing Delay The company related that it will be unable to file its Annual Report on Form 10-K for the year ended Dec. 31, 2007, by the extended filing date under Rule 12b-25 of the Securities Exchange Act of 1934. As the company has not yet received all of the necessary information from its equity method investees, the company has not been able to complete certain disclosures in the notes to the company's consolidated financial statements. The company intends to file its Form 10-K soon as practicable after the required information is obtained on or before April 30, 2008. The audit report of Deloitte & Touche LLP on MAXXAM's consolidated financial statements for the year ended Dec. 31, 2007, is expected to contain an explanatory paragraph indicating that the uncertainty surrounding the ultimate outcome of the Bankruptcy Cases and its effect on the company, well as the company's operating losses at its remaining subsidiaries, raise substantial doubt about the company's ability to continue as a going concern. On April 1, 2008, the company advised the American Stock Exchange that the company would not be able to file the Form 10- K by the extended filing date under Rule 12b-25 of the Securities Exchange Act of 1934 due to the inability of the company to obtain all of the necessary information required to complete disclosures related to its equity method investees. On April 1, 2008 the AMEX furnished the company with a letter indicating that the failure to timely file the Form 10-K is a violation of Sections 134 and 1101 of the AMEX company Guide and the company's listing agreement with the AMEX. As a result of the filing delay, AMEX will broadcast an indicator over its market data dissemination network noting the company's noncompliance. The presence of an indicator does not constitute a trading halt or delisting. The AMEX Letter, among other things, requires the company to submit a plan by April 15, 2008, advising the AMEX of the action the company has taken, or will take by June 30, 2008, to bring the company into compliance with above-referenced sections. The AMEX Letter also indicates that the AMEX may initiate delisting procedures if (a) the company does not submit the Compliance Plan, (b) submits a Compliance Plan that is not accepted by the AMEX, (c) does not make sufficient progress under the Compliance Plan during the plan period, or (d) the company is not in compliance with the above-referenced sections by June 30, 2008. About MAXXAM Headquartered in Houston, Texas, MAXXAM Inc. (AMEX: MXM) operates businesses ranging from aluminum and timber products to real estate and horse racing. MAXXAM's top revenue source is Kaiser Aluminum, which has been in Chapter 11 bankruptcy since 2002. MAXXAM's timber subsidiary, Pacific Lumber, owns about 205,000 acres of old-growth redwood and Douglas fir timberlands in Humboldt County, California. MAXXAM's real estate interests include commercial and residential properties in Arizona, California, Texas, and Puerto Rico. The company also owns the Sam Houston Race Park, a horseracing track near Houston. Its chairperson and chief executive officer, Charles Hurwitz, controls 77% of MAXXAM. At Sept. 30, 2007, the company's balance sheets showed total assets of US$543.7 million and total liabilities of US$785.3 million resulting to total stockholders' deficit US$241.6 million. |
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