Retailer Steinhoff warns on collapse of pound

Harveys and Bensons for Beds owner Steinhoff has warned the collapse in the value of sterling following the EU referendum could have an adverse impact on its British businesses.

Steinhoff is in the midst of taking over Poundland.

The South African retailer, which is also in the midst of taking over Poundland, said the currency’s plunge may result in an “unfavourable effect when translating out businesses’ earnings reported into euro”, adding it could have “an adverse effect on future margin”.

Sterling has plummeted more than 10 per cent against the dollar since June 23.

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As well as the Poundland acquisition, Steinhoff has made a determined effort to expand further across Europe recently, having tried and failed to gatecrash two deals earlier this year.

It recently lost out in a battle with Sainsbury’s to buy Argos owner Home Retail Group in March, and was outbid for London-listed white goods retailer Darty.

It is backed by South African retail billionaire Christo Wiese, whose Brait investment group also owns controlling stakes in Virgin Active, New Look and food chain Iceland.

The firm added: “The referendum on 23 June... has created uncertainty in the business community and financial markets.

“While the effect of this decision on consumer demand across Europe remains uncertain, the devaluation of the pound sterling may also result in an unfavourable effect when translating our businesses’ earnings reported into euro.”