Steinhoff’s first-half loss more than doubles to $1.7 bln

PUBLISHED: Thu, 30 Jul 2020 17:12:19 GMT

JOHANNESBURG (Reuters) – South African retailer Steinhoff International Holdings, battling to recover from a massive accounting fraud, saw its first-half loss more than double as a coronavirus lockdown towards the end of the period weighed on sales.

The company’s loss for the six months ended March 31 widened to 1.5 billion euros ($1.8 billion) from 571 million euros in the same period last year.

It reported a small rise in sales to 6.2 billion euros from 6.1 billion euros a year earlier, held back by fewer stores and shoppers.

The COVID-19 lockdown had an impact on the group’s retail businesses from mid March.

“As a result, turnover reduced, particularly in general merchandise, for the duration of these restrictions. The performance of the group’s fast-moving consumer goods-focused businesses has been more resilient, partially offsetting this impact,” the retailer said in its 85-page half-year results report.

Steinhoff said trading after lockdown restrictions were eased had been better than expected thanks to pent-up demand, but it was unclear whether this would be was sustained.

Apart from dealing with the pandemic, the retailer, which is also listed in Frankfurt, is trying to settle about 90 legal claims from shareholders who lost money when the company revealed holes in its accounts in 2017. These were the initial signs of an accounting fraud since estimated at $7 billion.

On Monday, the company proposed to pay around $1 billion to settle outstanding claims totalling over 9 billion euros ($10.6 billion).

The group’s net debt remains high – at 9.7 billion euros in the first half, up from 9.6 billion euros last year.

By 1308 GMT, Steinhoff’s shares were down 2% in Johannesburg, and down 3.4% in Frankfurt.

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