One analyst queried why
"Minority shareholders are now facing a R1.5 billion rights issue, which will be underwritten by
A number of analysts have also raised the prospect of a clawback of bonuses paid to executive management on the basis of the earnings achieved in the past financial year.
In a trading statement issued on Tuesday,
Management said the company was adopting a more conservative approach because of "the deteriorating credit quality in both the secured and unsecured lending market". Management also announced that although total revenue for the group had increased slightly in the six months, "merchandise sales in the furniture retail operations declined".
This week's dramatic news from
However, analysts said while the weak trading conditions had aggravated
Yesterday Botha told Business Report that if the "more conservative" approach had been taken during the last financial year, it was unlikely that the senior executives would have been paid any bonuses as these payments were linked to short-term earnings performance.
At last year's annual general meeting the
"The remuneration policy appears to be inconsistent with best practice; it does not have set targets with clear key performance indicators linked to weightings."
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