The company is required to correct several significant inventory movement issues with certain key retailers. This has resulted in the company taking some conservative reserves against sales in the third quarter, to reduce net revenues to approximately $2 million. Current indications suggest that these revenues will be made up in the fourth quarter. The company has had to make a downward adjustment in its gross margin contribution, and thus its earnings, by $8 million from a previously reported profit of $0.2 million.
