Troubled Steinhoff to restate results back to 2015

JOHANNESBURG: The scandal-hit South African retail giant Steinhoff announced yesterday it would restate some financial results for 2015 and 2016 amid a probe into accounting irregularities.

Last month, Steinhoff revealed it was under criminal and tax investigations, with a reported six-billion-euro ($7-billion) hole in its accounts. “The 2016 and 2015 financial statements of Steinhoff Investment Holdings Limited will need to be restated and can no longer be relied upon,” the company said in a statement.

Steinhoff had been a darling of fund managers with its eclectic, sprawling, consumer-focused empire with outposts in 30 countries. Its businesses include British high street discounter Poundland, France’s Ligue 1 sponsor Conforama and Pep Africa, which runs the continent’s largest clothing factory.

Due to the accounting scandal, the group said in December that it would not be able to immediately publish audited financial results for 2017. Chief executive Markus Jooste and chairman Christo Wiese both resigned in the wake of the accounting crisis that engulfed the company.

Since early December, Steinhoff shares have lost 87 percent of their value on the Johannesburg Stock Exchange, where the company has a secondary listing.

Credit ratings agency Moody’s last week downgraded debt held by the company and warned of further downgrades due to “increasing pressure” on the company’s cashflow.

“That the restatements will not apply to Steinhoff Services Ltd. should be seen as positive as it builds on the impression that the accounting difficulties are confined to some European operations,” analyst Charles Allen told Bloomberg.