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Johannesburg - AltX-listed voice and data firm Vox Telecom expects annual earnings and headline earnings to decline by as much as 55% as a result of the collapse of its stockbroker Dealstream Securities, it advised on Tuesday.
"Shareholders are advised that a reasonable degree of certainty exists that the company's EPS and HEPS are expected to be between 45% to 55% lower than the 7.67 cents per share reported in the prior year as a result of the collapse of Dealstream Securities," the company said.
The company said if the Dealstream debacle and related effects on it are excluded, EPS and HEPS, respectively, would have been between 20% and 30% higher.
Vox, which had invested million of rands in the stock brokerage house, said its legal advisors are formally compiling a claim against Dealstream which will be lodged with the curator in due coarse.
In addition, Vox said it has launched a forensic investigation to determine the possible embezzlement of its assets by Dealstream. Early findings suggest 27.3 million shares issued by the Vox and earmarked for employee share incentives and held by a third party might have been misappropriated and that their recovery is materially prejudiced.
"The forensic auditors, the company's legal advisors and the curator are investigating the circumstances under which these shares appear to have been misappropriated and in the event of their non-recoverability, the additional exposure to the company would be a reduction in equity of approximately R17m with no related income statement effect," the company said.
Vox added that it had instructed its attorneys to report the perpetrators to the prosecuting authorities and to assist the relevant authorities in any ensuing investigation and prosecution.
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