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Five things making headlines in South Africa today

Steinhoff releases annual report, axed Old Mutual CEO takes insurer to court, May inflation rate and more.

Here’s what caught our attention on Wednesday:

1. Steinhoff annual report

Steinhoff published its long-awaited annual report and financial statements for the year ended September 30, 2018 on Tuesday. The company admits that the last 18 months have been its most challenging yet, but says losses in the year through September were almost a quarter of what they were in the previous 12 month period. The company’s restated results show that net losses for the period amounted to €1.2 billion, down from €4 billion in the previous year. Steinhoff says the company and group can now continue in operational existence, given its cash flow forecast for the foreseeable future, but due to its current liquidity position has resolved not to declare a dividend until further notice.

Read the full report here.

Read: Steinhoff takes first steps toward recovery as losses narrow

2. Axed Old Mutual CEO takes insurer to court

Old Mutual’s former CEO, Peter Moyo, who was fired on Tuesday following a month-long suspension, is fighting back against the insurer. Moyo’s lawyer has released a statement indicating that Old Mutual’s reasons for the termination of employment were incomplete and misleading. Old Mutual cited a conflict of interest relating to NMT Capital and a breakdown of confidence as reasons for firing Moyo, but his lawyer claims that the insurer has not suffered any financial or other prejudice as a result of the former CEO’s actions.

Read:

Moyo to take Old Mutual to court – statement 

Old Mutual shareholders want Moyo to exit without a golden handshake

3. Consumer price inflation and inflation rate

South Africa‘s headline consumer inflation increased marginally to 4.5% year-on-year in May from 4.4% in April, data from Statistics South Africa showed on Wednesday.

Core inflation – which excludes the prices of food, non-alcoholic beverages, petrol and energy – was at 4.1% year-on-year compared to a 4.1% increase in April, and was at 0.0% month on month compared to 0.3% increase last month. 

Read: At the mercy of fuel prices rather than interest rates

4. Support for debt-laden Eskom

South Africa’s state power utility is descending deeper into financial crisis. Eskom’s debt is said to be approaching R500 billion, according to data compiled by Bloomberg. National Treasury has previously said that it has no other choice but to provide financial support to Eskom and this was confirmed by President Ramaphosa on Tuesday. The president will announce more support for Eskom at his state of the nation address on Thursday. The rand gained following the news.

Read: The only option for Eskom is one South Africa can’t afford

5. Entrepreneurs take Nedbank to court

Two award-winning entrepreneurs from the Western Cape are taking Nedbank to court on claims the bank stole their patented card-blocking system, Instablock. Moneyweb is reporting that Thandile Jwambi and Tatolo Kutumane are seeking more than R280 million in damages from the bank. Nedbank denies stealing the software, but says it will apply to have the patent revoked on condition that the ‘claimed inventions are not new’.

Read: Gugulethu entrepreneurs claim Nedbank stole their patented card blocking system

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