Tongaat Hulett forensic probe is done – but its results have been delayed, yet again | Fin24
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Tongaat Hulett forensic probe is done – but its results have been delayed, yet again

Oct 07 2019 19:01

On Monday evening, Tongaat Hulett announced that it is still not ready to release its results to the end of March. It also won't publish a forensic report into activities at the company.

PricewaterhouseCoopers has wrapped up and handed over its forensic report into suspect activities at Tongaat Hulett.

In June, the 127-year old company and biggest sugar producer in SA, was suspended on the JSE and in London, where it has been listed since 1939. Tongaat asked that its listings be suspended because of accounting irregularities.

Tongaat said an ongoing financial review has revealed that "certain past practices" do not reflect the company's business performance accurately. The overstatements may have been related to the treatment of Tongaat's property assets, analysts have speculated.

PwC has been busy with a report into irregularities at the company since March, and the final report has been issued.

"An overview of the report will be provided to shareholders at an appropriate time. The report itself is confidential and subject to legal privilege, and accordingly will not be published," Tongaat said in a statement.

Along with the forensic review, the company has also launched an internal review of the "appropriateness" of its accounting policies.

"The internal review process has been complex and extensive, going back some six years. It was performed in consultation with the group's external auditors and has necessitated a number of amendments to the group's major accounting policies and practices."

As a result, the company says it won't be able to publish its March-end results on the planned release date of October 31.

It will now only announce the release date in mid-November.

Tongaat said it is progressing well in its negotiations with its South African and Mozambican debt providers on the restructure of its short and long-term debt facilities.

Before its suspension, Tongaat's market capitalisation was R1.8bn, while its 2018 financial results show that total liabilities amount to R14.6bn. 

The company is considering the possible sale of assets, a possible equity capital raise, or a combination thereof to help settle its debt.

Compiled by Helena Wasserman

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