Labat Africa, headed by former rugby boss Brian van Rooyen, says yesterday's restatement of its results for the year to 28 February was carried out under protest.
The JSE threatened Labat on Monday with the suspension of trading in its shares as a result of the company not issuing its annual report within the stipulated six months of the end of the financial year.
The restatement of the results, at the insistence of auditors Rain, means Labat can now post its annual report (which it says will be carried out next Tuesday) and avoid the suspension, although the board is still disputing its auditors' opinions.
Rain previously expressed concern about the ability of Labat's integrated circuit producer, Sames, to continue as a going concern. When the full-year financial statements were first published in June, they contained a qualified review opinion by Rain to this effect.
However, Labat has insisted that Sames is being turned around and is a going concern.
Disagreement
The results released yesterday reflect, "under protest", the effects of the write-off of various items relating to Sames, including deferred tax assets and goodwill.
At the heart of the matter is a dispute with the South African Revenue Service (SARS) over an assessed tax loss of R190 million in Sames.
Van Rooyen says the board disagrees with the write-offs and the treatment of a surplus on the revaluation of plant and equipment. He says the directors reserve their right to get alternative advice to confirm their views and, if appropriate, to change the financial statements again.
"The directors have engaged independent experts and are reviewing the validity of each of these transactions. The directors are still awaiting confirmation from SARS that the R190 million tax losses in Sames will not be disallowed."
He says Labat's lawyers believe SARS has no legal basis to disallow the tax losses.
Losses widened
The restated results reflect a headline loss of 20.5c per share, compared with the originally reported 13c per share, and a basic loss of 34.8c per share, against a previously disclosed earnings per share of 9.17c.
Labat, having disposed of various businesses, now consists of Sames and Labat Traffic Solutions, which specialises in traffic enforcement solutions using digital camera technology. The group plans to list the traffic solutions business separately.
In July, investment group Mvelaphanda Holdings, headed by former Gauteng premier Tokyo Sexwale, bought 35% of Labat Traffic Solutions for R26 million.
The Labat share, which gained 2c, to close at 25c yesterday, was trading 3c, or 12%, down at 22c this morning. This was after 33 790 shares changed hands in four deals. The share price is still 25% higher than a year ago and 56% higher than three months ago.
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