Foreign currency rates can have a big impact on expenses and profits when projects are carried out on foreign soil or with foreign-bought materials. The complaint for this class action alleges that TechnipFMC did not maintain proper internal control over the rates used to calculate its financial results. The complaint claims that the problem made its public statements inaccurate and misleading, in violation of the Securities Exchange Act of 1934.
The class for this action is all persons who acquired TechnipFMC securities between April 27, 2017 and July 24, 2017, and were damaged at the corrective disclosures.
TechnipFMC provides services for oil and gas projects, including subsea, surface, onshore, and offshore services, around the world. The company was formed from a merger of FMC Technologies, Inc. and the French company Technip SA and is headquartered in London.
At the beginning of the class period, on April 27, 2017, TechnipFMC issued a press release and filed a Form 8-K to announce first-quarter 2017 financial and operational results. It claimed net income of over $190 million, with order intake of $1.6 billion. On May 4, it filed a Form 10-Q with its full results, repeating the figures. In a section on Controls and Procedures, it state that its controls were effective; it also contained signed Sarbanes-Oxley certifications.
However, according to the complaint, the information disclosed was false or misleading, because TechnipFMC had a weakness in internal control over the rates used to calculate foreign currency effects on its projects.
On July 24, 2017 TechnipFMC issued a press release and filed a Form 8-K saying that the company would restate its financial statements, because the statements for the three months ended on March 31, 2017 were not accurate. The press release cited “certain rates used in the calculations of the foreign currency effects on certain of its engineering and construction projects” as being solely responsible for the problem.
Disturbingly, it said, “The net income attributable to the Company in the quarter ending March 31, 2017 was overstated by $209.5 million…”
The complaint claims that the company’s earlier statements, about both its financial results and its internal controls, were false or misleading, in violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and SEC Rule 10b-5.
Article Type: LawsuitTopic: Securities
Most Recent Case Event
TechnipFMC Foreign Currency Rate Miscalculations Securities Complaint
August 3, 2017
Foreign currency rates can have a big impact on expenses and profits when projects are carried out on foreign soil or with foreign-bought materials. The complaint for this class action alleges that TechnipFMC did not maintain proper internal control over the rates used to calculate its financial results. The complaint claims that the problem made its public statements inaccurate and misleading, in violation of the Securities Exchange Act of 1934.
technipfmc_sec_compl.pdfCase Event History
TechnipFMC Foreign Currency Rate Miscalculations Securities Complaint
August 3, 2017
Foreign currency rates can have a big impact on expenses and profits when projects are carried out on foreign soil or with foreign-bought materials. The complaint for this class action alleges that TechnipFMC did not maintain proper internal control over the rates used to calculate its financial results. The complaint claims that the problem made its public statements inaccurate and misleading, in violation of the Securities Exchange Act of 1934.
technipfmc_sec_compl.pdf