More litigation for Steinhoff as investigation nears completion
On Thursday, embattled retailer Steinhoff warned of more litigation following a disastrous year during which legal claims amounting to billions of euros were initiated in the wake of Markus Jooste’s departure as CEO.
The company, which lost more than R200bn of its market value following the collapse of its share price in December 2017 when it admitted to accounting irregularities, says it expects the forensic investigation by PwC into its affairs to be completed by the middle of March.
“A number of legal proceedings have been initiated against the group, in addition to those reported previously,” it stated in the update posted on its website on Thursday.
The company has established a newly constituted litigation committee to assist its management and supervisory boards in dealing with law suits underway in SA and Europe, most of which relate to losses incurred by shareholders in relation to “accounting irregularities”.
The company again re-affirmed that its audited financial statements for 2017 and 2018 will be published on April 18. As far as the ongoing forensic investigation is concerned, it said: “PwC has now substantially completed its work and expects to deliver its report in mid-March. The company will only provide an overview of the report prior to the publication of results.”
The trading performance of Pepkor Europe and locally listed Pepkor Holdings continues to be the bright spots for the group in the quarter to end-December.
The trading update, which represents activity during the busy Christmas period, shows that revenue from continuing operations rose 3% to €4.691bn.
Its French-based furniture retail chain Conforama’s turnover fell by 3% over the prior corresponding period to €927m, as it was forced to close during civil protests last year.
By contrast, Pepkor Europe, which comprises Pepco (Eastern Europe) and Poundland (UK), reported that revenue increased by 15% to €993m, with Pepco growing revenue by 34%.
JSE-listed Pepkor Holdings, in which Steinhoff still owns a 71% stake, grew revenue by 5% to €1.198bn. The group also generated a good result at its automotive unit, but there were small revenue declines at Mattress Firm and Greenlit Brands (previously Steinhoff Asia Pacific).