Honestly, we thought Leap’s earnings restatements would be a blemish on the company. For the past three years, they’ve misreported their numbers because they were counting customers who, well, weren’t customers of theirs anymore. This inflated their earnings numbers — and possibly deceived investors. With time to spare before their December 31 deadline, Leap has refigured their earnings for the years 2004 through 2007, and it’s actually not all bad. Operating revenue took the biggest hit, dropping from $102.2 million to $79.7 million. You never want to see a 20 percent (or so) drop, but it certainly could have been worse. Service revenue was just a drop in the bucket: down $7.5 million from $3.09 billion. The problem was that Leap was counting customers for an extra month after they had terminated the service. This was the major cause for the reduction in operating income. The other error was recording revenue in the incorrect periods, which wouldn’t have hurt the overall numbers. It just changes what happened in each quarter. When the re-tally was announced, Leap’s stock hit a 52-week low of $29.87. However, they’ve rebounded as of late, and closed yesterday at $49.85, which is nothing short of stellar for Leap. [SignOnSanDiego.com]]]>
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