eBusiness Weekly
Business Writer
Tongaat Hulett finally released its financial results for the year to end-March as well as its restated results for 2018 on Tuesday. The figures show an almost R11,9 billion reduction in the group’s equity, mainly due to a R7 billion hit from its Zimbabwean business.
The delayed results and restated 2018 financials from the agriculture and land-development giant follow revelations of accounting and governance irregularities under the group’s former leadership that came to light earlier this year.
Current and former executives are currently under probe with regards the accounting irregularities.
Tongaat said it intends to institute civil claims against former and current top executives at Hippo Valley Estates Limited and Triangle Limited, over misstatements in its financial reports.
Zimbabwe-based executives facing civil claims include John Chibwe (Hippo Valley Estates Finance Director), Mr Sydney Mtsambiwa (former managing director of THL’s Zimbabwean operations), Mr Raphael Pfunye (Zimbabwe Sugar Sales Finance Executive) and Mr Steve Frampton (former Zimbabwe Sugar Sales General Manager).
The results, released this week show that the group has suffered R4 billion in impairments due to “the derecognition of expropriated land in Zimbabwe”.
Tongaat Hulett was dealt a further blow of R3 billion related to deferred tax assets that had not been recognised in Zimbabwe.
Meanwhile, sugar production at the Zimbabwean unit increased by 16 percent from 392 000 tons in the previous year to 453 700 tons, while yields also improved following the recovery from the drought and through increased irrigation.
Local demand remained steady despite the substantial increases in the sugar price, as sugar is regarded as a defensive holding against a declining currency.
“The Zimbabwe sugar operations generated operating profit of R1,201 billion (2018: R425 million),” the Group said.
Significant currency gains and a 66 percent increase in sugar prices translated into a significant fair value gain in standing cane valuations.
Export sales from the Zimbabwean operations increased from 58 000 tonnes per annum to 130 000 tonnes, trading off lower global sugar prices for hard currency.
