CAPE TOWN - Steinhoff International has been accused of more deception.
In a new report released by Moneyweb, the company is said to have lied about how much money they lost last year.
When Steinhoff International disclosed their interim results for the six months to March 31 last year, they said that they had a healthy operating profit of R14.5 billion.
The company said that they had a operating margin was 7.5%. Former CEO Markus Jooste said at the time that he was proud of the company’s performance.
“This solid revenue and margin performance underscores the resilient model of the group,” he said. “This has been further underpinned by both our product and geographical diversification in what remains a resilient discount market. The strong leadership and execution from our operationally focused management teams also continues to deliver good growth.”
This was not true. These 2017 numbers were not accurate and when the company reported its 2018 results the figures where very different. Revenues for the six months to March 31, 2017 were quoted at R163.6 billion but the actual figure was R158.8 billion.
These means that the operating profit had was a lie or disappeared and in fact the company had instead experienced an operating loss of R2.7 billion.
Put plainly the company had overstated its operating profit by a staggering R16.1 billion.
The new results also show that Steinhoff’s US and UK operations were not making a profit.
In the US, and the UK a large proportion of Stienhoff’s units made losses. In the US the loss was R1.3 billion for the six months to the end of March.
The loss in the UK was R225 million.
Steinhoff also noted a significant change in its total equity position. For the year ended September 30, 2016, Steinhoff said it could report a total equity position of R266.9 billion but this figure changed to R91.4 billion. This is 65.8% lower.
Of Steinhoff’s total assets of €19.838 billion, €9.359 billion, or 47%, is listed as goodwill or intangible assets.
This means that the company’s liabilities are €16 045 billion.
Former chairman Christo Wiese told Radio 702 that the restatements was "mind-boggling" and wanted to know asked how the books could be manipulated for more than a decade.
Wiese is currently suing Steinhoff for R59 billion.
Earlier today it was reported that Steinhoff International is being investigated by the Hawks, and three cases related to allegations of fraud at Steinhoff and its subsidiaries have been reported after the group submitted a series of allegations against Jooste.
Minister of Police Bheki Cele confirmed on that the Hawks were investigating Steinhoff and that two of the cases were reported in Stellenbosch and one in Johannesburg.
One of the Stellenbosch cases includes theft, extortion, forgery and a failure to report knowledge of wrongdoing. Jooste resigned from his post in December after the group admitted to accounting irregularities which led to a decline of more than 95 percent in its share price and losing about $12 billion (R164.41bn) in market capitalisation.
A member of the supervisory board, Steve Booysen, submitted the report against Jooste to the Hawks at the end of January. Steinhoff ’s report accuses Jooste of being party to the falsification of accounting records, providing false or misleading information with a fraudulent purpose, being party to an act or omission by Steinhoff calculated to defraud creditors, employees or shareholders, and being party to untrue written statements required by the Companies Act.
Steinhoff share price stands at R1.35.
READ MORE: Hawks look at Steinhoff fraud cases
- BUSINESS REPORT ONLINE