Steinhoff shares drop by 6% after charges on executives are reported
Brandon Topham, the newly appointed director for investigations and enforcement at the Financial Sector Conduct Authority (FSCA), said this week that action would be taken soon. He said the company had consented to the fact that they had published false and misleading information.
The directors of Steinhoff are yet to face the consequences after admitting to accounting irregularities in December 2017 which has led to the 95percent decline to its share price.
The former chief executive Markus Jooste resigned after the admission and has appeared before Parliament to answer for his role in the company's misfortunes.
Jordan Weir, a trader at Citadel, said after months of silence occasionally interspersed by hollow feedback, the regulator’s announcement appears to have been intended to provide underlying shareholders with hope.
“However, this announcement will not necessarily be met with relief by shareholders, as by the sound of things the FSCA still needs to gather a reasonable amount of information from Steinhoff,” Weir said.
He added that of even more concern obtaining the information needed did not appear as easily achievable for regulators as expected, and it looked like some material information had not even been requested yet.
The market and investors are still waiting for PricewaterhouseCoopers’s forensic report into what happened at Steinhoff, which has been delayed several times due to the complexity of the fraud.
Last week Steinhoff released a third quarter update to end December, with group revenue from continuing operations up by 3percent to to 4.69 billion (R75.6bn).
The group said the operational results for the quarter continued to reflect the knock-on impacts of the announcement of accounting irregularities in December 2017.
“While management is still spending a significant amount of time engaging with funders, suppliers and credit insurers, from a customer confidence point of view, trading is starting to show signs of stabilisation.
"Most of the general merchandise businesses are expanding at a rapid pace, while in the household goods businesses, new store openings continue to be considered only on a highly selective basis and many capex projects remain on hold,” the group said.
Steinhoff shares closed 6.83percent lower at R1.91 on the JSE yesterday.