Steinhoff International struggling to shake off impact of scandal
DURBAN - Troubled retailer Steinhoff International widened its losses to €1.84 billion (R35.68bn) for the year to end September 2019, up from €1.19bn compared to a year earlier, as the group is still struggling to shake off the impact of the 2017 accounting scandal in its operations.
The group acknowledged yesterday that it is continuing with its journey to address past deficiencies and to bring stability to the group and its businesses.
“While the road ahead remains difficult, the financial year to end September 2019 was a pivotal period for the group, during which we made tangible progress, most significantly with the completion
of our financial restructuring following the implementation of the company voluntary arrangements (CVAs) and the associated changes to our group structure and governance arrangements,” the group said.
However, Steinhoff reported an increase in the advisory fees to €158 million during the year, up from €117m compared to a year earlier. The group said the fees included €16m relating to the forensic investigation and technical accounting support, and €67m relating to creditor advisor fees while finance costs also increased to €1.09bn, up from €646m in 2018.
Steinhoff’s debt remained high at €9.6bn at the end of the period, up from €9.1bn in 2018.
“The net debt balance increased over the reporting period, mostly from interest and fee accruals and the assumption by the group of the €178mn Mattress Firm debt,” the group said.
However, the group’s revenue from continuing increased by 5 percent to €12bn, with strong contributions from Pepco Group, which was up by 12 percent and Pepkor Africa up by 4 percent.
Its basic and diluted loss a share from continuing operations increased to 28.2 euro cents a share, up from 13.9 euro cents.
Steinhoff share price traded weaker at the JSE in the morning and was down by 1.96 percent to R1 a share.