Poundland Parent Steinhoff Announces Investigation Into Accounting Irregularities

Andrew Cummings
December 6, 2017

JOHANNESBURG, Dec 6 (Reuters) - Steinhoff International's shares crashed on Wednesday after it revealed accounting irregularities and its CEO quit, shocking investors who had backed the rapid reinvention of a South African furniture chain into an worldwide retail empire.

The company said late on Tuesday that he had resigned with immediate effect, after the discovery of new information prompted the firm to ask PwC to perform an "independent investigation".

The retailer, which has origins in South Africa, has a base in Amsterdam and a primary listing in Frankfurt, said on Monday it wasn't able to release audited full-year financial results on Wednesday due to matters related to a criminal and tax investigation in Germany.


Reuters reported last month that Steinhoff did not tell investors about nearly $1 billion in transactions with a related company, despite laws that some experts say require it to do so.

Steinhoff advised its shareholders and other investors to "exercise caution when dealing in the securities of the group", but a panicked sell-off has already caused the business's market cap to more than halve.

The company had previously said authorities there were examining whether revenue was booked correctly and taxable profit correctly declared. A spokesman declined further comment. "In addition, the Company will determine whether any prior years" financial statements will need to be restated'.


Chairperson of Steinhoff Holdings International, Christo Wiese will step in as interim CEO after Jooste's resignation.

Steinhoff is a sprawling corporation which operates approximately 12,000 retail outlets across 30 countries.

The Supervisory Board wishes to reassure shareholders that Steinhoff has a number of high quality profitable businesses around the world.


Steinhoff, which employs 130,000 people, did not respond to requests for information about what, if anything, Wiese knew about the accounting problems now being investigated.

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