Shares in Steinhoff International Holdings NV fell as much 61% at opening on the JSE on Wednesday following the resignation of the company’s CEO amid accounting irregularities.<\/p>\n
Shares in the company dropped to R17.56, a loss of R28.09 or 61.53%, shortly after the exchange opened.<\/p>\n
Steinhoff was due to publish financial results on Wednesday, however that has been postponed because of accounting irregularities. Fund manager at Ashburton Investments, Wayne McCurrie said in a note on social media: “The effect must be material and can be a serious drag on the company and its reputation for years”.<\/p>\n
Chief executive officer Marcus Jooste resigned with immediate effect on Wednesday after the global furniture and clothing retailer reported irregularities in its accounts that require further investigation.<\/p>\n
The owner of the France-based Conforama furniture store chain and Pep clothing stores in Africa has appointed auditor PwC to probe the matter, it said in a statement on Tuesday.<\/p>\n
“Steinhoff will update the market as the aforesaid investigation proceeds. The Company will publish the audited 2017 consolidated financial statements when it is in a position to do so. In addition, the Company will determine whether any prior years\u2019 financial statements will need to be restated,” it said.<\/p>\n
South African billionaire and chairman of the company, Christo Wiese, will run the company on a temporary basis.<\/p>\n
The retailer, which has origins in South Africa, has a base in Amsterdam and a primary listing in Frankfurt, said Monday it wasn\u2019t able to release audited full-year financial results on Wednesday due to matters related to a criminal and tax investigation in Germany.<\/p>\n
It had previously rejected allegations made in a Manager-Magazin report that Jooste is among employees being investigated by German prosecutors in a 2015 case linked to possible accounting fraud.<\/p>\n
Steinhoff shares had previously slumped 18% on Monday and Tuesday. The company has transformed itself in the past four years from a mostly African-focused retailer to an acquisitive powerhouse that now owns Mattress Firm in the US and Poundland in the UK.<\/p>\n
Wiese is South Africa\u2019s fourth-richest person with a net worth of $4.3 billion, according to the Bloomberg Billionaires Index.<\/p>\n
PSG Financial Services advised shareholders on Wednesday that its board of directors received and accepted the resignation of Jooste as a non-executive director of PSG Group and PSG Financial Services, with immediate effect.<\/p>\n
“He will be replaced by his alternate director, Mr Theodore de Klerk, who has been appointed as a non-executive director to the boards of PSG Group and PSG Financial Services with immediate effect,” it said.<\/p>\n