In March, Innospec got hit on both sides of the Atlantic (see here) and agreed to pay $40.2 million in combined DOJ/SEC/SFO fines and penalties for violating the Foreign Corrupt Practices Act and other laws.
However, it could have been worse.
The SEC release (see here) notes that Innospec, without admitting or denying the SEC’s allegations, was ordered to pay $60,071,613 in disgorgement, but because of Innospec’s “sworn Statement of Financial Condition” all but $11,200,000 of that disgorgement was waived.
The release states that “[b]ased on its financial condition, Innospec offered to pay a reduced criminal fine of $14.1 million to the DOJ and a criminal fine of $12.7 million to the SFO. Innospec will pay $2.2 million to OFAC for unrelated conduct concerning allegations of violations of the Cuban Assets Control Regulations.”
In other words, Innospec got a pass on approximately $50 million.
This occured on March 18th.
Last week, Innospec announced (see here) it financial results for the first quarter ended March 31th (i.e. approximately two weeks from March 18th).
“Total net sales for the quarter were $163.5 million, up 10% from $148.1 million in the corresponding period last year. Net income was $7.4 million, or $0.30 per diluted share, a 16% increase from $6.4 million, or $0.26 per diluted share, a year ago. EBITDA (earnings before interest, taxes, depreciation, amortization and impairment) for the quarter was $15.4 million, compared with $16.0 million a year ago.”
“As of March 31, 2010, Innospec had $67.5 million in cash and cash equivalents, $22.5million more than its total debt of $45.0 million.”
Innospec’s President and Chief Executive Officer stated, “we are very pleased with our first quarter operating results …”.
I am a lawyer by training, not a finance professional.
So forgive me, but I am scratching my head over this one.
March 18th – Innospec gets a pass on $50 million in an FCPA case because of its financial condition.
March 31st – Innospec reports positive financial results, including $67.5 in cash and cash equivalents.