VERITAS DGC INC.

VERITAS DGC INC.

March 14, 2005 08:31 ET

Veritas DGC Inc. Updates Status of Financial Restatement


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: VERITAS DGC INC.

TSX, NYSE SYMBOL: VTS

MARCH 14, 2005 - 08:31 ET

Veritas DGC Inc. Updates Status of Financial
Restatement

HOUSTON, TEXAS--(CCNMatthews - March 14, 2005) - Veritas DGC Inc.
(TSX:VTS)(NYSE:VTS) announced today that, as it has not yet completed
its previously announced restatement of its prior period financial
statements, it will delay filing its quarterly report on Form 10-Q for
the period ended January 31, 2005.

As a result of reviews associated with completion of its year-end and
restatement procedures, the Company determined that its accounting
policies related to mobilization of equipment and crews and those
related to a limited number of customer contracts with specific customer
refund rights or certain revenue sharing provisions were not in
accordance with generally accepted accounting principles. Based on that
determination, the Company has modified its accounting policies with
regard to these issues.

These accounting corrections will defer revenue and profit into future
periods and will impact the profit before tax of previously reported
periods as follows: reduce Q1 of 2005 by $0.6 million, reduce fiscal
2004 by $0.9 million, increase fiscal 2003 by $0.3 million and decrease
fiscal 2002 by $0.7 million. The Company will include these adjustments
related to the accounting corrections with the previously disclosed
pre-tax adjustments totaling approximately $3.2 million in its
restatement, described in its press release of October 13, 2004.

The Company is currently responding to comments from the staff of the
Securities and Exchange Commission regarding its annual report on Form
10-K for the fiscal year ended July 31, 2003. The Company has responded
to most of the staff's comments to date and will be providing
information to the staff related to the Company's historical experience
regarding its use of estimates when applying the sales forecast
accounting method to its multi-client data library. The Company's
management believes that its methods and estimates related to its
accounting for its multi-client data library are appropriate under
relevant accounting pronouncements and are consistent with industry
practice. If changes to these methods or estimates are required, such
changes could have a material impact on the Company's results.

Chairman and CEO Thierry Pilenko commented, "I am pleased to report
that, despite this distraction, our operations have performed very well
during this time. The preliminary results of our second quarter are
excellent, one of our best ever. I can also tell you that we have ended
the period with over $200 million in cash, an increase of approximately
$70 million from the previous quarter end. I look forward to the time in
the near future when we can discuss our results in detail."

Mr. Pilenko concluded, "Our restatement process has taken longer than we
expected but I believe that we are now through much of the process. We
expect to hold our quarterly conference call to discuss the results of
our second quarter in the next few weeks. We will announce the date and
details of this conference call several days prior to the actual date of
the call."

Veritas DGC Inc., headquartered in Houston, Texas, is a leading provider
of integrated geophysical, geological and reservoir technologies to the
petroleum industry worldwide.

The Company cautions that statements in this release may constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These include statements as to
expectations, beliefs and future financial performance, such as
statements regarding business prospects. All of these are based on
current information and expectations that are subject to a number of
risks, uncertainties and assumptions. These risks and uncertainties are
more fully described in the Company's reports filed with the Securities
and Exchange Commission. Should one or more of these risks or
uncertainties materialize, or should the assumptions prove incorrect,
actual results may vary in material respect from those currently
anticipated. In addition, the Company has previously announced that it
will restate certain prior periods' results, including the prior fiscal
year. The financial information included in this release is preliminary
and subject to audit. The Company cautions that its review of its fiscal
2004 results, and those of prior periods, is ongoing and additional
adjustments may be necessary.

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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Veritas DGC Inc.
    Mindy Ingle
    (832) 351-8821