By GlobeNewswire, March 13, 2013, 08:30:00 AM EDT
World Energy Solutions Provides Update on Progress of Q4 & Fiscal 2012 Financial Reporting
WORCESTER, Mass., March 13, 2013 (GLOBE NEWSWIRE) -- In follow up to its recent announcement postponing its fourth quarter and fiscal 2012 financial results and conference call, World Energy Solutions, Inc. (Nasdaq:XWES) today provided additional details on the cause of the delay.
The Company is currently evaluating its revenue recognition policy for its mid-market product line, an area the Company entered with its acquisition of GSE Consulting (GSE) on October 31, 2011.
The review is primarily focused on the timing of revenue recognized from up-front commissions received from mid-market energy suppliers. As currently reported, such commissions represent approximately 10 percent of World Energy's consolidated revenues for the nine months ended September 30, 2012 and approximately 3 percent of consolidated revenues for the year ended December 31, 2011.
Under its accounting policies in effect at the time, World Energy recognized revenue from these up-front commissions as cash was received from the energy supplier. As a result of this review, the Company is in the process of determining the appropriate periods in which such commissions should be recorded. The Company believes it may be appropriate to record these revenues over the energy flow period similar to its other Retail electricity product lines, to the extent that actual energy usage is available or can be reliably estimated. If not, the recognition of revenue may be deferred to the end of the contract period. Regardless of the timing of revenue recognition, there would be no impact on the cash received by the Company.
The impact of the contemplated adjustments would be to defer the recording of revenue from historic periods to future periods. As part of this process, the Company is conducting, but has not completed, an analysis of the materiality of the potential revenue recognition adjustments on its previously reported financial results.
The Company's finance team continues to work diligently with its auditors to complete the audit and all filings by their respective deadlines, but, because of the scope of work required - an analysis of over 3,000 accounts - the Company may file for an extension of its March 31 deadline. Once the Company has completed its audit, it expects to announce a date to release its fourth quarter and full-year 2012 financial results and host its earnings conference call.
About World Energy Solutions, Inc.
World Energy Solutions, Inc. (Nasdaq:XWES) is an energy management services firm that brings together the passion, processes and technologies to take the complexity out of energy management and turn it into bottom-line impact for the businesses, institutions and governments we serve. To date, the Company has transacted more than $30 billion in energy, demand response and environmental commodities on behalf of its customers, creating more than $1 billion in value for them. World Energy is also a leader in the global carbon market, where its World Energy Exchange® supports the Regional Greenhouse Gas Initiative (RGGI), the first mandatory market-based regulatory program in the U.S. to reduce greenhouse gas emissions. For more information, please visit www.worldenergy.com.
The World Energy Solutions, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=16555
This press release contains forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ from those indicated in the forward-looking statements. Such risks and uncertainties include, but are not limited to, the following: our revenue and backlog are dependent on actual future energy purchases pursuant to completed procurements; the demand for our services is affected by changes in regulated prices or cyclicality or volatility in competitive market prices for energy; the potential impact on our historical and prospective financial results of a change in accounting policy may negatively impact our stock price; and other factors outside our control that affect transaction volume in the electricity market as well as our overall business. Additional risk factors are identified in our Annual Report on Form 10-K and subsequent reports filed with the Securities and Exchange Commission.
CONTACT: Dan MeesWorld Energy Solutions, Inc.
firstname.lastname@example.orgSusan FormanDian Griesel, Inc.
Source: World Energy Solutions, Inc.