Tongaat refinery in KZN.Photo Supplied

CAPE TOWN – Troubled sugar producer Tongaat Hulett has had its shares suspended on the JSE as well as the London Stock Exchange, where the company has a secondary listing, it was announced on Monday.

In a statement published on the Stock Exchange News Service (Sens) the company said the board had voluntarily approached the JSE with a request for a suspension of the listing of the company’s securities. 

“The JSE has granted this request, and accordingly the listing of the company’s securities on the JSE has been suspended.” 

The company said the board had now reached a conclusion that the need to restate the March 2018 financial statements, and the consequential impact on the 30 September 2018 statement of financial position, rendered reliance on the unaudited interim results for the six months to September 2018 no longer appropriate. 

“Similarly, reliance on the Company’s Trading Statement for the twelve months ended 31 March 2019 is no longer appropriate,” it said. 

“As the board does not have the necessary degree of certainty to apportion the restatement across the different financial periods, there is not currently sufficiently reliable information to enable the board to update the financial information in the September 2018 interim results or the February 2019 trading statement with confidence.”

Tongaat’s share price plunged roughly 30 percent in March after the group said it was bringing in PricewaterhouseCoopers (PwC) to conduct a comprehensive review of “certain practices” at the company that might impact on its previously reported financial information.

On Thursday Tongaat fell more than 4 percent on the JSE as PwC began its probing of the group’s 2018 financials amid mounting operational challenges.

Last week Tongaat Hulett said that its audited financial statements for the period needed to be restated, after a review found that reporting reflected in the 2018 financial statements was in the process of being determined and an estimated reduction in the amount reflected as the company’s equity as at April 1, 2018, was anticipated to be between R3.5 billion and R4.5bn.

The company said the decision to have its shares suspended had not been taken lightly. 

“While the board is conscious that some shareholders or potential investors would prefer to retain the ability to buy and sell shares, the board believes that the temporary suspension is in the best interests of shareholders as a whole.”

The board said it viewed the suspension as a temporary measure until the company was in a position to provide sufficient further information to the market and expected that the suspension would be lifted no later than the time of release of the March 2019 financial statements.

BUSINESS REPORT ONLINE