Oakbay gets help from revisionist accounting
At a tricky time for the Gupta family, a tweaking of numbers does make it seem that an asset up for sale is not doing all that badly
WOakbay’s share price would cost him about R100-million when he sells it. On Monday, the company published a trading statement on the JSE’s investor news service Sens before releasing its interim results for the six months to the end of August. JSE rules require that shareholders be warned if results will be significantly worse or better than those of previous years.
Since Oakbay narrowly avoided having its listing suspended when both its exchange sponsor and auditors quit, it has scrupulously followed JSE rules, if in a sometimes unusual fashion.
In September, it delivered an annual report just hours before the deadline, in which it copied, verbatim and initially unacknowledged, large parts of the strategies of two competing companies, and presented this as its own.
its warning, Oakbay told shareholders it would report a loss of about R65-million for the six months to the end of August, “being a deterioration of 49.8% in comparison to the previously reported loss for the six months ended 31 August 2015”.
Compared with the figures Oakbay published this time last year, the deterioration is almost 90%. In the interim, the company had restated its losses for the 2015 period, adding R9.2-million to that tally, which all had the effect of making this year’s performance seem comparatively better.
Oakbay similarly restated all its 2015 half-year figures with which it compared itself this week, increasing attributable losses and its loss per share by about one-quarter across the board.
The company did not respond to questions, including why the 2015 figures had been so significantly restated.
The figures published on Monday had not been reviewed by its auditors, Oakbay said on Sens, and the stake in Oakbay, worth R543-million at current market prices.
In late August, the Gupta family announced in a statement it believed “the time is right for us to exit our shareholding of the South African businesses” and said it intended “to sell all of our shareholding in South Africa by the end of the year”. The statement did not say whether that would be by the end of the calendar year or by the end of the financial year in February 2017.