2017 FINANCIAL ACCOUNTS
Steinhoff’s gaping R250bn hole threatens its existence
Steinhoff’s delayed 2017 financial accounts released on Wednesday showed alleged fraud that drew comparisons to Enron and raised questions about the viability of what was once the world’s second-largest furniture retailer. The company’s shares were down almost 8% in Frankfurt at 8.15pm SA time, leaving it with a market valuation of just €490m (about R7.9bn) — from more than €14bn just before the accounting scandal broke in December 2017 — after it said the value of its assets had dropped by about R250bn compared with previously released 2016 numbers. After the write-downs, the firm was left with a €4.03bn loss, a swing of nearly €5.5bn over the previous period. "Sadly, in my opinion, there is no value left," said Peter Armitage, founder of Anchor Capital. "It’s hard to believeit is so big. Remember the world’s biggest fraud was R650bn," he said in reference to Enron. Enron was a Houston-based energy trading company that used off balance sheet entities in much the same way as Steinho...
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