Krispy Kreme Restates 2003-05 Earnings

A long-awaited restatement of Krispy Kreme Doughnuts Inc.’s earnings has reduced its pretax income by $34 million from fiscal 2003 to the third quarter of fiscal 2005, the company said.

The restatement had been in the works since early last year, when Krispy Kreme ousted Chief Executive Scott Livengood, hired a turnaround specialist and asked a special committee formed in October 2004 to investigate accounting practices during the company’s final years under the former CEO.

Krispy Kreme said it also was recording a write-off of $132 million in the third quarter of fiscal 2005 related to reacquiring franchise rights in excess of the fair market value of those rights.