Key insights
Part of the censure related to a R500 million ($36 million) writedown Pepkor took in May, related to a controversial management-incentive plan that pre-dated the listing. The R5 million fine imposed by the JSE on Monday may make investors nervous about the potential of other, as-yet-unknown problems related to Steinhoff, which almost collapsed amid an accounting scandal a year ago. The operator of clothing chains including Pep and Ackermans is also embroiled in a court battle against former executives of shoe retailer Tekkie Town, which Steinhoff bought in 2016.
Market reaction
Pepkor shares have slumped 25 percent since Steinhoff’s announcement almost a year ago that it had uncovered accounting irregularities and its CEO had resigned.
Get more
Pepkor said it’s working “intensively to improve its disclosure where necessary and appropriate.” The extent that Steinhoff-related issues distracts management from running the business should not be underestimated, said Syd Vianello, an independent retail analyst in Johannesburg.
