Fitch: Reliability of IPG's Financial Reporting Remains a Concern.CHICAGO -- Fitch Rating's 'B+' senior unsecured and multicurrency bank credit facility ratings for The Interpublic Group of Companies This article or section needs sources or references that appear in reliable, third-party publications. Alone, primary sources and sources affiliated with the subject of this article are not sufficient for an accurate encyclopedia article. (IPG IPG Implantable pulse generator, see there ) remain on Rating Watch Negative following the company's April 5, 2005, announcement of preliminary and unaudited revenue and operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before for 2004. The status of the IPG's full-year 2004 audit and filing of its Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. remains uncertain and Fitch continues to be concerned about the reliability of the company's financial reporting. Fitch expects to conclude its review and resolve its Rating Watch status on IPG following the filing of the company's Form 10-K for 2004 and the auditors' opinion on those statements. Fitch lowered IPG's ratings to 'B+' from 'BB+' and placed the ratings on Rating Watch Negative on March 11, 2005. These actions reflected the increased levels of negative event risk at IPG, concerns about the reliability of the company's financial reporting and the ability of IPG's auditors to provide an "unqualified" opinion about the company's financial reports, and IPG's earnings and cash flow outlook, given the company's weak organic growth trends and significant pressures on operating margins. Certain event risks have been resolved since this rating action. On March 30, 2005, IPG announced that it had received covenant waivers on all of its bonds that extend the "event of default" filing requirement date for the company's Form 10-K from March 31, 2005 to Sept. 30, 2005 and extend the filing requirement of the Form 10-Q Form 10-Q See 10-Q. for the first and second quarters of 2005 to Sept. 30, 2005. Furthermore, on March 31, 2005, IPG received waivers and amendments on its $700 million of credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities from the bank syndicate related to the late-filing covenant, extending the required filing date for the Form 10-K from March 31, 2005 to June 30, 2005 and the Form 10-Q for the first quarter of 2005 to July 31, 2005. IPG also received amended financial covenants for minimum interest coverage, maximum debt/EBITDA leverage, and minimum EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become . |
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