Simclar Inc. (SIMC)

Last Trade: 9.14
Trade Time: 11:29AM ET
Change: Up 4.05 (79.57%)

Simclar (SIMC) , a contract electronics manufacturer, was surging 44% Thursday after the company said a review of its financials found that errors in its accounting were limited to its unit in Mexico.

Additionally, Simclar said revenue for the quarter ended June 30 was $30.5 million and earnings were $790,000, or 12 cents a share. Shares of Simclar were gaining $2.25 to $7.34 in premarket trading.

Because of the accounting mistakes, Simclar will restate its financials for 2005 and the quarter ended March 31. Last year's earnings will be revised down to 15 cents a share from 19 cents, and first-quarter net income will decline to 8 cents a share from 11 cents.

"We recognize the seriousness of this matter relative to internal controls and the integrity of our financial statements," said Sam Russell, chairman and chief executive. "However, these errors do not impact our basic business operations and there is no evidence of fraudulent activity on the part of any employee."

The company said an examination of its other business units didn't find any similar errors to those that took place in the Mexico operation.