Key Energy Shares Fall Due to Delayed SEC Filing

Key Energy shares fell as much as 17 percent after the Midland, Texas-based firm delayed a filing with the Securities and Exchange Commission for fiscal 2003 due to its continuing financial review.

The stock was last at $10.75, down 95 cents, after a $9.75 low. More than 9 million shares traded hands -- making the stock one of the top volume leaders on the New York Stock Exchange.

Key Energy said that it currently believes it will need to write down roughly $78 million in idle equipment assets, and that it expects to re-state one or more prior year financial statements.

The oil and gas well service firm had previously indicated it would write down about $55 million in assets, but that amount was subject to review because the company believes that the impairment status of certain assets was "inaccurate," and that the disposal values of some assets were less than previously estimated.

Certain assets are under an "enhanced" review following the company's discovery that certain "improprieties" had occurred at the South Texas division, including misappropriation of funds and diversion of company assets, Key Energy said.

The company also told investors its prior financial statements shouldn't be relied upon.

Still, activity levels remain in line with its expectations with revenue for the March quarter projected between $242 million and $246 million, the company said.

Key Energy has also initiated discussions to secure waivers of the financial covenants of its credit facility.