Choppies doesn’t know what’s in its shoppies

print

Choppies doesn’t know what’s in its shoppies

Published Date: 2018-03-26 | Source: Stephen Gunnion | Author: Stephen Gunnion

Choppies doesn’t know what’s in its shoppies

The Botswana-based retailer says it needs to reverify and value its inventories and its trading statement can no longer be relied upon

Shares in Choppies slumped 15%to R2.60 on Friday after the supermarket group withdrew a trading statement for the six months ended December due to concerns about data on its inventory.

The company said it had told management to perform more detailed procedures on the verification and valuation of inventory along with new auditors PwC. It said the process would only be completed by the end of April and that guidance provided in a trading statement last month could no longer be relied upon.

In the trading statement, it said earnings per share for the period were expected to be 25% to 35% higher, while headline earnings per share would be up by 20% to 30%. The expected increased had been driven by an improved performance at its South African supermarkets.

Small caps analyst Keith McLachlan said changes to the verification and valuation of inventories could impact the group's cost of sales and profits.



Similar Stories