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Crisis-Hit Steinhoff Reports Nine-Month Sales Rise 2%

Published on Sep 1 2018 9:00 AM in Retail tagged: Dealz / trading update / Steinhoff Africa Retail

Crisis-Hit Steinhoff Reports Nine-Month Sales Rise 2%

Dealz owner Steinhoff reported a slight increase in nine-month sales on Friday (31 August) as its managers remained preoccupied with cleaning up after an accounting fraud that nearly tipped the South African retailer into bankruptcy.

Steinhoff was thrown a lifeline last month when its creditors agreed to delay debt claims for three years after the multinational retailer uncovered accounting irregularities that sent its shares crashing and left it scrambling for working capital.

Maintaining Stability

The company, which is registered in the Netherlands, said sales rose 2% to €12.9 billion ($15 billion) in the nine months through June as a strong showing at its separately listed African unit, Pepkor, offset weak results from Europe, the United States, and Europe. The group's brands include Mattress Firm in the United States and Poundland in Britain.

"As a management team we are focused on maintaining stability within the operations; finalising the implementation of the restructuring plan with the group's financial creditors; improving governance at all levels," the company said in a statement.

Shares in Steinhoff rose 1.7% to 2.89 rand (17 cents) as of 1130 GMT, valuing the company at around 12 billion rand (€0.7 billion), far from the more than 200 billion rand (€11.6 billion) valuation the stock fetched just nine months ago.

Steinhoff has already written down the value of its assets by more than€10.3 billion ($12 billion) following the initial findings of an investigation into the company's past bookkeeping practices.

The probe, being carried out by auditing firm PwC, has uncovered accounting irregularities that date back to at least 2015, and is expected to be completed by the end of the year.

News by Reuters, edited by Checkout. Click subscribe to sign up for the Checkout print edition.

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