Posted in: Comics, Comics Publishers, Current News, IDW | Tagged: diamond, Penguin Random House
IDW Pushes Back On Auditor's Report That Warns Of "Substantial Doubt"
IDW pushes back on auditor's report that warns of "substantial doubt" in the comic book publisher's future.
Article Summary
- IDW held an investors' call amid concerns over financial stability.
- Diamond Comic Distributors’ bankruptcy impacts IDW, but it's not existential.
- Concerns arise from a report questioning IDW's future as a going concern.
- IDW disputes auditors' negative outlook, promising more information soon.
As promised, IDW Publishing held an investors' call last night. I was invited to attend through one of those "Press 1 for Monday, Press 2 for Tuesday, Press 3 for Wackaday" kind of phone systems. which is harder than it sounds to call in from London, UK. Because it kept kicking me out and wouldn't let me back in, I spent a lovely evening constantly talking to the operator, who kept manually adding me back. And then the replay option didn't work. So I probably got about a tenth of the investors' call, which is something legally required as a publically listed and traded company. While IDW has been delisted from the NYSE, shares can still be purchased through platforms like Fidelity. As a result, I wasn't able to ask questions of my own. But I did manage to hear a couple of interesting things, and I jotted them down in the scrum.
First, regarding the Diamond Comic Distributors Chapter 11 bankruptcy, I didn't hear anything about the threat of Penguin Random House leaving IDW on the hook for the IDW-related debt that PRH was owed by Diamond. However, they did say that while bankruptcy had a significant impact, it was not an existential one. More distributors are picking up the slack, and the bigger impact on retailers will probably be around having more bureaucratic hoops to go through.
The second aspect concerned the report that was picked up by Bleeding Cool from independent auditors, which stated "substantial doubt exists about the Company's ability to continue as a going concern" and stated, "PRH has informally indicated to IDW that their understanding of the relevant terms of the contract between IDW and PRH provides that the significant majority of such uncollected amounts will be debited by PRH from future payments from PRH to IDW".
In the investors call, IDW stated that they are pushing back on the auditors over this aspect of the report, and are providing more information so that they might give a different conclusion. Bleeding Cool will be happy to report this as and when they do so.
