Tongaat’s Zim unit decides to delay its financials
TROUBLED Tongaat Hulett’s Zimbabwe unit, Hippo Valley, yesterday said it would delay its financials by a month to re-evaluate its previous statements as they would be impacted by the restating of its parent company’s earnings.
Hippo Valley said while it was not aware of any deliberate or fraudulent errors in its financials, it was worried that its performance could be affected by the developments in South Africa.
Company secretary Bigboy Shava said the board would, however, perform its own internal review of the company’s financial statements to assess accounting policies. Shava said the group had been granted authorisation by the Zimbabwe Stock Exchange to delay its financials for the year to end March to the end of July.
Tongaat has a significant interest in Zimbabwe through its ownership of Hippo Valley and non-listed Triangle Sugar Corporation, accounting for nearly 80 percent of production. It said that it would streamline its workforce and this will include employees from its Zimbabwe operations as the SA agro-processing concern scrambles for a way out of an accounting crisis that distorted its financial position.
In the year to end March 31, 2018, Hippo Valley’s operating profit rose to $17 million (R248.91m), significantly up from the $13.4m last year.
“The review of the company’s financials has resulted in a delay in the release of the company’s financial results for the year ended March 31, 2019… which will now be published on or before July 31, 2019, following the granting of an extension by the ZSE,” explained Shava.
Tongaat last month announced that a review of its financials for the period to end March 31, 2018, had revealed “certain past practices” that would result in the restatement of its audited consolidated financial statements.
The South African agro-processing concern said the past accounting practices in question were of concern to the group’s auditors and board. As a result of this, some adjustments to the financials, relating to non-cash evaluations, including reassessment of sales of land and biological assets, require a review.
Analysts said they expected Hippo Valley to institute voluntary suspension from the ZSE in line with decisions taken by its parent company to protect shareholders. Other Zimbabwean companies that have been granted permission to delay the publishing of results include Econet Wireless and fintech company Cassava.