CPI AEROSTRUCTURES FILES FORM 12B-25 NOTIFICATION OF LATE FILING OF ITS ANNUAL REPORT ON FORM 10-K

- Retains Big 4 Accounting Firm to Advise & Assist with Remedial Actions -

EDGEWOOD, N.Y., March 16, 2020 (GLOBE NEWSWIRE) -- CPI Aerostructures, Inc. (CPI Aero)  (NYSE American: CVU) today announced that it has filed a Form 12b-25 Notification of Late Filing with regard to its Annual Report on Form 10-K for the year ended December 31, 2019. The Company requires additional time to complete a review of its procedures for revenue recognition from contracts with customers for 2018 and 2019 following its February 14, 2020 announcement of an error relating to the Company’s recognition of revenue under ASC Topic 606 that will require it to amend its annual report on Form 10-K for the year ended December 31, 2018 and its quarterly reports on Form 10-Q for the quarters ended March 31, 2018, June 30, 2018, September 30, 2018, March 31, 2019, June 30, 2019, and September 30, 2019 (the “non-reliance periods”), and to remedy a material weakness in its internal controls over financial reporting as of the end of each non-reliance period.

As a result of the pending restatements of its financial statements, and the fact that the audited financial statements for the year ended December 31, 2019 cannot be finalized until the restated financial statements for the non-reliance periods are completed, the Company was unable to complete its financial statements and file its 2019 Form 10-K by the prescribed due date for such filing (March 16, 2020) without unreasonable effort or expense. The Company intends to include in its Annual Report on Form 10-K for the year ended December 31, 2019, restated financial statements and other disclosures for the non-reliance periods as soon as reasonably practical.

In addition, shortly after its February announcement, CPI Aero engaged one of the four largest international accounting and auditing firms to advise and assist management in correcting the material weaknesses and preparing and implementing proper revenue recognition procedures.

Douglas McCrosson, president and CEO of CPI Aero, stated, "We have made good progress towards preparing the required financial statements and remain committed to filing restated financial reports and other disclosures for the periods affected as reasonably practical. To that end, we have completed a review of the major contracts with customers and are in the process of completing detailed revenue recognition rules for each contract. The final step will be to apply these rules to determine the revenue and profit contributions for each contract during each of the financial reporting periods.”