03/25/2009 11:00PM

Magna won't file annual report


Magna Entertainment Corp., the racetrack owner and operator that filed for bankruptcy in early March, will not file an annual report detailing its financial performance for fiscal year 2008 and will refrain from filing quarterly financial reports in the future, the company said on Thursday.

In a release, Magna said that it could not file accurate financial statements because of its "ongoing court-supervised restructuring process." Magna is currently operating under the protection of Chapter 11 bankruptcy rules, and its shares have been delisted from both the Nasdaq and Toronto stock exchanges.

"In particular, the expense and effort involved in complying with annual and quarterly reporting requirements cannot, in the opinion of the company, be justified in light of MEC's current operational and financial situation," the Magna release said.

Magna has continued to operate its racetracks after filing for bankruptcy. The company has asked the court to approve two separate auction processes for its properties. The court is expected to rule on the auctions at a hearing on April 3.

One of the auctions would pertain to a bundle of properties that Magna has agreed to sell to its parent company and controlling shareholder, MI Developments. Both companies are controlled by Magna's founder and chairman, Frank Stronach.

Magna last filed financial statements with U.S. and Canadian securities regulators for the third quarter of 2008. In those statements, the company registered a loss over the first nine months of the year of $116.1 million, or $19.87 per share, bringing its losses over the previous four years to more than $400 million. The company announced at that time that it had hired Miller Buckfire, a consulting firm specializing in bankruptcy reorganization, as an adviser.

As it reorganizes, Magna said it would file reports with the bankruptcy court that are similar to the financial statements required by the Securities and Exchange Commission.