South Africa's Tongaat Reports Loss And Net Asset Value Plunge
South African sugar producer Tongaat Hulett on Tuesday warned of 'material liquidity uncertainty' that could threaten its survival after reporting a narrower annual loss.
Its results for the year to 31 March 2019, had been delayed following an accounting scandal.
Tongaat said its net asset value had fallen to negative 2.972 billion rand (€180 million) from a value of 62 million rand (€3.81 million) a year earlier.
While Tongaat said the company faced 'material liquidity uncertainty', it does not plan to curtail operations or liquidate businesses other than to make disposals that may be necessary to reduce its debt.
Operationally Tongaat saw a narrower headline loss per share than a year earlier - 823 cents versus 861 cents in its restated 2018 figures.
Group revenue fell 2% to 17.1 billion rand (€1.05 billion).
'Reset The Baseline'
"The results are better than anticipated given the turmoil of the past year, and importantly, an accurate accounting of our financial position allows us to reset the baseline," CEO Gavin Hudson, who took over in February, said in a statement.
Excessive sugar imports in South Africa and Mozambique, a sugar tax in South Africa hitting demand and low world sugar prices had hurt the results, Tongaat said.
In November, PricewaterhouseCoopers (PwC) found that certain senior executives at Tongaat had overstated profits and certain assets by using "undesirable" accounting practices.
"The closure of this chapter will free up management to focus on delivering on our strategy and begin to build a sustainable and long-term future," Hudson said on Tuesday.
Investors have been jittery about accounting irregularities after South African retailer Steinhoff International Holdings NV revealed a more than $12 billion hole in its accounts in December 2017.