WESTMORELAND COAL COMPANY (NASDAQ:WLB) Files An 8-K Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review

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WESTMORELAND COAL COMPANY (NASDAQ:WLB) Files An 8-K Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review

Item 4.02. Non-Reliance on Previously Issued Financial Statements
or a Related Audit Report or Completed Interim Review

On February 23, 2017, the Audit Committee (the Audit Committee) and
the Board of Directors of Westmoreland Coal Company (Westmoreland,
or the Company), after consultation with Westmorelands management,
concluded that Westmorelands consolidated financial statements as
of and for the years ended December 31, 2015, 2014, and 2013 and
interim unaudited consolidated financial statements as of and for
the quarters ended September 30, June 30, and March 31, 2016 and
2015 (collectively, the Previously Issued Financial Statements)
should be restated for the reasons described below and,
accordingly, that such Previously Issued Financial Statements
should no longer be relied upon. Westmorelands management and the
Audit Committee have discussed the matters disclosed in this Form
8-K with the Companys independent registered public accounting
firm, Ernst Young, LLP (EY).
In connection with the preparation of the Companys Annual Report on
Form 10-K for the year ended December 31, 2016 (the 2016 Form 10-K)
and during the year-end audit, management and EY reevaluated the
Companys January 1, 2003 adoption of FASB Statement No. 143, Asset
Retirement Obligations>(currently Accounting Standards
Codification 410-20, Asset Retirement Obligations) in relation to
the accounting for contractual reimbursements the Company will
receive from certain customers upon the completion of final
reclamation. Management and EY have concluded that in these
circumstances the Companys reclamation receivables should have been
recorded as mineral rights and depleted on a units of production
basis, cash received on performance of final reclamation should
have been recorded as revenue, and cost of sales should have been
recognized to reflect accretion of the asset retirement obligation
liability. Certain other immaterial prior period errors will also
be corrected as part of this restatement. The quantification of
these restatements is ongoing, but the Company expects the
following approximate impact:
Financial Statement Impact (in $ millions)
For the 9 months ended September 30, 2016
For the year ended December 31, 2015
For the year ended December 31, 2014
Increase in revenue
$3.4
$9.5
$15.3
Increase in accretion expense (reflected in cost of
sales)
8.7
9.1
9.9
Increase in depreciation, depletion, and amortization
expense
11.8
9.6
9.4
(Decrease) in operating income
(17.1)
(9.2)
(4.1)
These restatements do not impact cash flows, liquidity, or debt
covenant compliance, and increase Adjusted EBITDA>due
to the increase in revenue for all Previously Issued Financial
Statements. Further, this change does not impact our conclusion
that we will receive the related contractual reclamation
reimbursements.

Westmorelands management conducted a reassessment of the Companys
internal controls and determined that a material weakness in the
Companys internal control over financial reporting existed. The
material weakness relates to the ineffective review of the
accounting policy for reclamation receivables for compliance with
Generally Accepted Accounting Principles (GAAP). As a result,
Westmorelands associated internal control procedures were not
effective as of December 31, 2016 or 2015.

The Audit Committee concluded Westmorelands Previously Issued
Financial Statements should be restated to correct the
aforementioned errors and that, accordingly, such Previously
Issued Financial Statements should no longer be relied upon.
Related press releases, investor presentations or other
communications describing Westmorelands financial statements for
these periods should also no longer be relied upon. In addition,
managements annual report on internal control over financial
reporting, set forth in Item 9A of Westmorelands Annual Report on
Form 10-K as of and for the year ended December 31, 2015 should
no longer be relied upon.

______________________________________________________________________________________________________


Adjusted EBITDA is a supplemental measure of financial
performance that is not required by, or presented in accordance
with, GAAP. This measure is not intended to be a substitute for
those reported in accordance with GAAP. Adjusted EBITDA may be
different from non-GAAP financial measures used by other
companies, even when similar terms are used to identify such
measures. We believe Adjusted EBITDA is a key metric used by
management and the Companys Board of Directors to assess our
operating performance and as a basis for strategic planning and
forecasting. Accordingly, we believe it is useful to an investor
in evaluating our performance. The impact of this restatement on
Adjusted EBITDA will be included in our 2016 Form
10-K.

Westmorelands management intends to file as soon as practicable
restated consolidated financial statements for the years ended
December 31, 2015 and 2014 in the 2016 Form 10-K. In addition,
the Company intends to include in the 2016 Form 10-K restated
quarterly financial data for all quarters within the years ended
December 31, 2016 and 2015, and Selected Financial Data for years
ended December 31, 2016 through 2012. Based on the information
regarding prior years that the Company intends to include in its
2016 Form 10-K, the Company does not intend to file amendments to
the Companys Annual Reports on Form 10-K or Quarterly Reports on
Form 10-Q for any of the Previously Issued Financial
Statements.

Cautionary Note Regarding Forward-Looking Statements

Forward-looking statements contained in this Form 8-K are based
on Westmorelands current expectations and assumptions regarding
its business, the economy and other future conditions. Because
forward-looking statements relate to the future, they are subject
to inherent uncertainties, risks and changes in circumstances,
including statements regarding the Company’s intent to restate
its prior financial statements and the estimated adjustments of
the restated financials, which are difficult to predict. Actual
results may differ materially from those contemplated by the
forward-looking statements. Westmoreland cautions you against
relying on any of these forward-looking statements. They are
statements neither of historical fact nor guarantees or
assurances of future performance. Factors that could cause actual
results to differ materially from those in the forward-looking
statements include, but are not limited to, the risk that
additional information may arise from the Companys and its audit
committees internal review, the risk that the process of
preparing and auditing the restated financial statements or other
subsequent events would require the Company to make additional
adjustments and the time and effort required to complete the
restatement of its financial statements, as well as other risks
described more fully in the Company’s filings with the
Securities and Exchange Commission. Any forward-looking
statements made by Westmoreland in this Form 8-K speak only as of
the date on which it was made. Westmoreland undertakes no
obligation to publicly update any forward-looking statements,
whether as a result of new information, future developments or
otherwise, except as may be required by law.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits
Exhibit No.
Description
99.1
Westmoreland Coal Company Press Release dated February
24, 2017


About WESTMORELAND COAL COMPANY (NASDAQ:WLB)

Westmoreland Coal Company is an energy company. The Company operates through six segments: Coal – U.S., Coal – Canada, Coal – Westmoreland Resource Partners, LP (WMLP), Power, Heritage and Corporate. Coal – U.S. segment includes the operations of coal mines located in Montana, North Dakota, Ohio, Texas and New Mexico. Coal – Canada segment includes the operations of coal mines located in Alberta and Saskatchewan. Coal – WMLP segment includes the operations of Westmoreland Resource Partners, LP, a coal master limited partnership. Power segment includes its Roanoke Valley Power Facility (ROVA) operations located in North Carolina. Heritage segment includes the benefits the Company provides to former mining operation employees, as well as other administrative costs associated with providing those benefits and cost containment efforts. Corporate segment consists of corporate administrative expenses.

WESTMORELAND COAL COMPANY (NASDAQ:WLB) Recent Trading Information

WESTMORELAND COAL COMPANY (NASDAQ:WLB) closed its last trading session 00.00 at 15.49 with 320,072 shares trading hands.