Johannesburg - Tiger Brands [JSE:TBS] said it fired managers at its Kenyan unit after they overstated sales last year to achieve operational targets.
“The top team in that business went after reaching their target and they sold forward in a way we would ordinarily not expect them to do,” chief executive officer Peter Matlare said at a presentation in Johannesburg Wednesday, referring to Nairobi-based Haco Industries, in which Tiger holds a majority stake.
“We got rid of those who did wrong.”
Haco’s operating profit declined R108m in the first half ended March 31 because of the “preinvoicing and manipulation of profits” in the prior year, Tiger said in a statement. This contributed to a 30% drop in operating profit at Tiger’s international and export unit during the period, Matlare said.
The irregularity at Haco is weighing on Tiger’s goal to increase earnings from businesses outside its home market as its Lagos-based Dangote Flour Mills business may face a third impairment since it was acquired for about $173m in 2012, Matlare said.