Steinhoff charges leap in lingering accounting scandal fallout


Steinhoff Worldwide Holdings NV’s annual advisory charges climbed 35% final yr, pushed by prices associated to a deal the retailer reached with collectors to skip debt repayments.

Steinhoff’s shares collapsed in late 2017 when the proprietor of Conforama in France and Pep shops in Europe and Africa grew to become engulfed in an accounting scandal. Locked in a battle for survival, the South African firm secured a long-awaited restructuring settlement in August protecting about 9 billion euros ($10.1 billion) of debt.

That deal got here with a price. Creditor-advice funds accounted for about 40% of complete advisory charges of 158 million euros, the corporate mentioned Tuesday in its annual report for the yr ended September. The Frankfurt-listed inventory stays greater than 98% decrease than earlier than the preliminary announcement of accounting irregularities.

“As within the earlier monetary yr, the prices of those processes have been substantial, they usually had a major influence on the reported outcomes for the yr,” Steinhoff mentioned. “Each effort is being made to restrict adviser prices and, with implementation of the monetary restructuring now behind us, we anticipate the full to fall within the 2020 monetary yr.”

Even so, authorized charges are anticipated to stay vital, Steinhoff mentioned, because of lawsuits introduced by those that misplaced out from the scandal. A plan by Steinhoff to cut back authorized prices by combining a few of its greatest particular person claimants into one case was rejected in Might.

Steinhoff has paid about 35 million euros associated to an intensive probe performed by forensic auditors at PwC. The corporate hasn’t publicly launched these findings. Steinhoff is now paying for them to assist South African anti-corruption police examine additional.

The annual report was the primary audited by Mazars LLP’s Netherlands unit after Steinhoff changed Deloitte LLP in November.

© 2020 Bloomberg