CEA Industries Inc.
06/17/2026 | Press release | Distributed by Public on 06/17/2026 14:10
Non-Reliance of Financial Report (Form 8-K)
Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review.
On June 11, 2026, the management of CEA Industries Inc. (the "Company"), with the concurrence of the Audit Committee of the Board of Directors, concluded that the previously issued condensed consolidated financial statements included in the Company's Quarterly Reports on Form 10-Q for the (i) three months ended October 31, 2025, the period from June 7, 2025 through October 31, 2025 (the "Second Quarter Successor" period) and the period from May 1, 2025 through June 6, 2025 (the "Predecessor" period), originally filed with the Securities and Exchange Commission (the "SEC") on December 15, 2025 (the "Second Quarter Form 10-Q") and (ii) three months ended January 31, 2026 and the period from June 7, 2025 through January 31, 2026 (the "Third Quarter Successor" period) and the Predecessor period, originally filed with the SEC on March 16, 2026 (the "Third Quarter Form 10-Q" and together with the Second Quarter 10-Q, the "Quarterly Reports on Form 10-Q") should no longer be relied upon.
The conclusion was based on the identification of an error in the calculation of the weighted-average number of shares outstanding used in determining basic and diluted earnings per share ("EPS"). The error resulted in an understatement of basic and diluted weighted-average shares outstanding, which in turn understated or overstated basic and diluted EPS. For the three months ended October 31, 2025, basic and diluted weighted average number of shares were understated by 2,214,508 shares and as a result, basic and diluted EPS were overstated by $0.21. For the Second Quarter Successor period, basic weighted average shares were understated by 1,857,056 shares and diluted weighted average shares were understated by 857,057 shares and as a result, basic and diluted EPS were overstated by $0.45. For the three months ended January 31, 2026, basic and diluted weighted average number of shares were understated by 2,376,236 shares and as a result, basic and diluted EPS were understated by $0.08. For the Third Quarter Successor period, basic weighted average shares were understated by 21,806,662 shares and diluted weighted average shares were understated by 21,806,663 shares and as a result, basic EPS was overstated by $4.26 and diluted EPS was overstated by $4.21. The error did not impact the Company's net income (loss), total assets, total liabilities, stockholders' equity, revenue, cash flows, or net income (loss) available to common stockholders in each affected period.
The Company intends to file amendments to the Quarterly Reports on Form 10-Q to restate the affected financial statements and related disclosures for the three months ended October 31, 2025, the Second Quarter Successor period, the second quarter Predecessor period, the three months ended January 31, 2026, the Third Quarter Successor period and the third quarter Predecessor period.
Management, along with the Audit Committee, has discussed the matters disclosed in this Form 8-K with Sadler, Gibb & Associates, LLC the Company's independent registered public accounting firm.
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