Markus Jooste conspired with other Steinhoff execs - report | Fin24
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Markus Jooste conspired with other Steinhoff execs - report

Mar 02 2018 06:35
Oliver Sachgau, Bloomberg

Munich - Steinhoff International Holdings' former chief executive officer Markus Jooste conspired with fellow executives at the retailer to move revenue figures around subsidiaries to boost their balance sheets, according to Sueddeutsche Zeitung.

Jooste, who quit in December after the company reported accounting “irregularities”, discussed how to manipulate accounts for the 2014 fiscal year, the German newspaper said, citing internal emails. The ex-CEO has been referred by Steinhoff to an anti-corruption police unit in South Africa, where the retailer is based, while auditors at PwC are investigating the company’s accounts.

The owner of Mattress Firm in the US, Poundland in the UK and France’s Conforama said on  Wednesday that PwC’s probe, commissioned in December, is focusing on off-balance-sheet structures and deals, particularly related to the central European businesses.

It’s likely to find that some assets, revenue and profit figures have been overstated, chairperson Heather Sonn said. Steinhoff has said it’s looking to restate accounts dating back to at least 2015, and hasn’t reported financials for the last fiscal year.

Steinhoff has sent information received from German media enquiries to PwC “to ensure that the subject matter forms part of the investigation”, a spokesperson said in an emailed response to questions. “Until PwC makes any findings in regard to this information, we are not in a position to engage in speculation about what their findings will be.”

Callie Albertyn, Jooste’s lawyer at Cape Town-based De Klerk and Van Gend, couldn’t immediately be reached for comment. Sueddeutsche said Jooste didn’t comment.

According to the newspaper, the ex-CEO told one of his managers to add an additional €100m (R1.45bn) of revenue from a subsidiary to help inflate the company’s reported profit. In a separate email, the then-CEO referred to a need to “clean up the past”, the newspaper said.

Steinhoff shares crashed almost 90% in December after the company reported the wrongdoing without giving detail. It’s reviewing the validity and recoverability of assets worth about €6bn, and may need to take impairments over and above that, it said on Wednesday.

The company moved its primary listing to Frankfurt from Johannesburg in 2015 and is registered in Amsterdam.

The stock slumped 12% to €0.36 as of 17:00 in Frankfurt. Similarly, the JSE price dropped 12% to close at R5.10.

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