Hanger, Austin, Texas, filed Form NT 10-Q with the U.S. Securities and Exchange Commission (SEC) on May 10, indicating that it is unable to file its Quarterly Report on Form 10-Q for the quarter ended March 31 within the prescribed time period without unreasonable effort or expense. Nor is the company able to provide a reasonable estimate of its results of operations for the quarter.
Hanger said it requires additional time to prepare its financial statements to be filed as a part of the Form 10-Q due primarily to its continuing efforts to complete its annual consolidated financial statements; its requirement to file restated consolidated financial statements as identified in and for the reasons described in the company’s Current Reports on Form 8-K filed with the SEC on February 7, June 9, and November 12, 2015, and February 26 and May 10, 2016; and the completion of the related audits.
Additionally, Hanger filed Form 8-K with the SEC on May 10. That filing states the company has not filed financial statements since the third quarter of 2014 and does not currently expect to file any periodic reports prior to the fourth quarter of 2016. The company is assessing the time necessary to complete its accounting and prepare its financial statements, and is working to complete its accounting processes, prepare its financial statements, and file its periodic reports for these and all subsequent periods with the SEC as promptly as possible.
As previously disclosed in prior Form 8-K filings, Hanger’s audit committee of the board of directors has retained counsel to conduct an investigation of the circumstances surrounding the accounting misstatements that led to the restatement, and the investigation is ongoing. Further, based on the discovery in the investigation of inappropriate activities by certain former employees of the company as disclosed in the February 26 Form 8-K, management decided to perform additional reviews, re-perform procedures, and validate historical source accounting data and journal entries for 2014 and prior periods. While the company is not yet able to provide preliminary balance sheet or income statement data for the financial periods for which it has not yet provided financial statements or reports, Form 8-K included preliminary estimates of certain cash flow data for the quarters ended March 31, 2015, and March 31, 2016, the 12 months ended December 31, 2015, and March 31, 2016.
As of May 2, Hanger had access to cash and cash equivalents in its bank accounts of $31 million and had drawn $132 million of its $138 million revolving credit line under its credit agreement, with the remaining capacity being utilized for the purposes of outstanding and anticipated letters of credit.
