Medicis said Wednesday that it will likely restate earnings since 2002 due to an accounting error, an announcement that prompted shareholders to bid down the stock 13 percent.
The Scottsdale-based marketer of prescription and aesthetic skin products said it did not immediately know how much a restatement may affect earnings and revenue, but it said cash flow will not be affected.
The accounting snafu comes as the company faces pressure on two fronts - looming generic competition for its Solodyn acne treatment and the potential that a slowing economy could diminish consumer appetite for its anti-wrinkle skin fillers Restylane and Perlane.
Those factors and the potential restatement prompted the company to say that its earnings guidance for the remainder of 2008 is no longer valid.
Medicis shares closed Wednesday at $15.58, down $2.34.
The company described the accounting issue as a technical error measuring its sales-return reserves. Its balance sheet reflected the cost of making such products rather than the wholesale price.
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