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DavidsTea to restate financial results after finding errors in quarterly reports

MONTREAL — DavidsTea Inc. says it will be restating financial reports from earlier this year to comply with accounting standards, a move that will delay completion of its third-quarter financial results.

The Montreal-based tea shop operator says it made errors in its first- and second-quarter reports related to changes in the way leases are handled under International Financial Reporting Standards.

DavidsTea says investors should no longer rely on its financial reports for the quarters ended May 4 and Aug. 3 and that the report for its quarter ended Nov. 2 will be delayed.

It says it has filed information about the restatement with the U.S. Securities and Exchange Commission.

The company says the restatement only affects non-cash impairment charges, amortization expenses, and its deficit at Feb. 3 and not other aspects of its previous reports.

In September, it reported a $7-million loss for the three months ended Aug. 3 and an $11-million loss for the six months ended Aug. 3. It hasn’t disclosed how much those figures would change under the restatement.

This report by The Canadian Press was first published Dec. 18, 2019.

Companies in this story: (Nasdaq:DTEA)

The Canadian Press