Tongaat Hulett’s market value plunged by nearly a fifth on Friday after the sugar producer said headline earnings in the year to end-March will probably fall by at least 250%.

In June last year, an Investec analyst called for then-CEO Peter Staude to step down after the company’s “appalling” results. That time around, headline earnings for the year to March 2018 had fallen 37.2% to R617m.

Tongaat said on Friday that with its high debt levels and interest costs, “any reduction in operating profit has a larger impact on earnings”.

The company, now headed by Gavin Hudson, has appointed advisors and will enter into discussions with lenders next week, it said. Furthermore, management is assessing various assets, including cane assets and project costs, for impairment risk.

Hudson’s mandate, according to Tongaat, is to “expedite an immediate and comprehensive strategic and financial review with a view to stabilising the business, addressing the debt levels and setting the path towards acceptable returns for shareholders”.

Priority areas for intervention include the streamlining of operations; rationalising, where appropriate; and improving business performance and accountability.

“During the course of the strategic and financial review, it has become clear that that the business is facing more challenges, and operational performance has continued to decline.”

Shares in the group closed 20.41% lower at R37.01 on Friday afternoon. In September 2014, it rose above the R170 mark.