Northwest Pipe again fails to comply with Nasdaq rules

Vancouver company faces delisting

By Aaron Corvin, Columbian port & economy reporter

Published:

Updated: March 22, 2012, 5:13 PM

 

Northwest Pipe Co. again faces being removed from the Nasdaq stock exchange if it doesn’t produce an updated plan to comply with exchange listing rules, the company said Thursday.

In a filing with the U.S. Securities and Exchange Commission, the Vancouver-based manufacturer of steel pipe said it received a letter from Nasdaq officials saying the company is no longer in compliance with listing rules because it failed to file its 2011 annual financial report in a timely manner.

That’s on top of the company’s failure to file its third-quarter financial report for 2011. For that infraction, the company said it received a letter from Nasdaq saying it needed to submit a plan to comply with the exchange’s listing rules.

The company said it submitted a plan to Nasdaq on Jan. 17, and that Nasdaq subsequently gave the company until April 16 to file the late third-quarter financial data.

The company said Thursday Nasdaq is now requiring it to update its plan to regain compliance no later than April 2. Any additional time Nasdaq grants the company to achieve compliance will be limited to a maximum of 180 days from its initial failure to file last year’s third-quarter report — or until May 14, the company said in its SEC filing.

Northwest Pipe said it plans to submit a revised compliance plan by April 2.

The most recent flap over the company’s relationship with the Nasdaq follows its announcement last week that it will have to restate a litany of quarterly and yearly financial data going back to 2008.

The company’s latest need to restate its books, including decreasing its retained earnings by up to $12 million, was prompted by “material errors” it made in accounting for the depreciation of equipment, according to SEC filings.

The company expects to file modified financial data with the SEC in April.

Northwest Pipe has previously disclosed other accounting problems. In November 2009, it announced wrinkles in the procedures it used to account for revenues. Shareholders sued the company in December 2009, accusing it of making “false and misleading” statements that inflated the company’s stock.

The lawsuit, filed in U.S. District Court in Tacoma, remains active. Attorneys representing both sides — shareholders, and the company and two former company executives — are in mediation talks to try to reach a settlement, according to court papers filed Feb. 6.

Northwest Pipe has been the subject of an SEC probe. It also has previously received multiple delisting warnings from the Nasdaq stock exchange for failing to file its financial reports in a timely manner.

A company can be delisted and continue to be profitable. However, a delisting can make it more difficult and more expensive for a company to raise capital.

The firm manufactures large-diameter, high-pressure steel pipelines, primarily for drinking water systems.

The company’s stock, which trades as NWPX, closed down 22 cents Thursday, at $21.26 per share. Northwest Pipe’s shares have traded between $19.20 and $30.92 in the past 52 weeks.

Aaron Corvin: http://twitter.com/col_econ; http://on.fb.me/AaronCorvin; 360-735-4518; aaron.corvin@columbian.com