Accounting errors may force Harvest Natural to restate results

Tue Mar 19, 2013 10:01am EDT

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(Reuters) - Harvest Natural Resources Inc (HNR.N) lost nearly half of its market value on Tuesday after the oil and gas producer said it identified some accounting errors that might force it to restate results for some periods in the last three years.

The company's stock fell 46 percent to a four-year low of $2.97 in early trading, making it the biggest percentage loser on the New York Stock Exchange.

Harvest Natural also estimated a loss of about $9.6 million, or 26 cents per share, for 2012.

Analysts on average were expecting a profit of 87 cents per share, according to Thomson Reuters I/B/E/S.

The company, which now has a market value of about $120 million, had reported profits on a per-share basis for the last nine quarters.

Harvest Natural said in a regulatory filing that there were errors related to incorrect capitalization of some lease maintenance costs and internal selling, general and administrative costs. (link.reuters.com/nyk76t)

The company's cash-flow presentation also had an error and some of its long-lived assets have been impaired, it said.

"Additional material weaknesses could be identified," Harvest Natural said in the filing.

The company's Chief Financial Officer Stephen Haynes declined to comment.

Harvest Natural suffered a setback last month when the Indonesian government scraped a planned $725 million sale of the company's Venezuelan operations to Indonesia's state oil company PT Pertamina PERTM.UL.

Harvest Natural holds exploration acreage mainly onshore West Sulawesi in Indonesia and in Oman, and offshore Gabon and China, apart from its Venezuela operations.

Harvest Natural had been looking to exit Venezuela after the country nationalized most of its operations there in 2007 and amid political uncertainty in the South American country.

(Reporting by Swetha Gopinath in Bangalore; Editing by Maju Samuel)

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