Toshiba Reports Larger April–December Loss (News)
Tokyo, Feb. 14 (Jiji Press)—Toshiba Corp. reported Tuesday a group net loss of ¥499.9 billion for April–December 2016, even larger than the year-before loss of ¥479.4 billion, due to its US nuclear power plant business debacle. The company’s auditors have not yet approved earnings for the nine-month period.
The unapproved results indicate that the struggling Japanese electronics and machinery maker fell into negative net worth, or an excess of liabilities over assets, at the end of December.
At a press conference, the company stated that its net worth stood at negative ¥191.2 billion at the end of December 2016, due mainly to its dismal performance in the nuclear power business, where it booked ¥712.5 billion in losses.
Effective this month, Toshiba will expand executive pay cuts over the performance in this sector, with President Tsunakawa Satoshi's salary slashed by 90%, up from the current 60% cut. Chairman Shiga Shigenori, who was in charge of Toshiba’s nuclear-plant-related operations overseas, has stepped down as a representative executive director of the firm.
Earlier on February 14, Toshiba filed for permission to postpone the release of its confirmed April–December earnings for one month until March 14, citing its investigation of claims of inappropriate accounting related to the US nuclear business. The Kantō Local Finance Bureau has approved the postponement.
"We deeply apologize for the delay in the announcement of earnings," stated Toshiba chief Tsunakawa at the press conference. "We'll make every effort to release the earnings before the March 14 deadline."
For the full business year through March, Toshiba is now projecting a net loss of ¥390 billion, which would bring its net worth at the end of March to negative ¥150 billion. This would be its third consecutive year of red ink.
Toshiba May Sell Majority Stake in Flash Memory Firm
Tokyo, Feb. 15 (Jiji Press)—Toshiba Corp. is considering selling a stake of over 50% in its flash memory business in an effort to boost its capital, its president and chief executive officer, Tsunakawa Satoshi, said Tuesday.
The struggling Japanese electronics and machinery maker plans to spin off the flash memory operations to avoid falling into negative net worth at the end of the current fiscal year on March 31. Toshiba had a negative net worth at the end of December, due chiefly to massive losses from its US nuclear operations.
The company initially planned sell a stake of less than 20% in the new flash memory firm. To avoid negative net worth at the end of its business year, though, Toshiba plans to raise ¥200 billion–¥300 billion in capital by spinning off its mainstay flash memory operation and selling a stake in the unit.
Toshiba is considering selling more than half of all shares in the planned flash memory company in the medium term. At the press conference, Tsunakawa stated that Toshiba will flexibly consider the best choice for the company, leaving open the possibility of selling all shares in the company.
Toshiba also plans to lower its stake in US nuclear subsidiary Westinghouse Electric Co. from its current 87%, and is also expected to consider the possibility of selling its stake in British nuclear subsidiary NuGeneration Ltd.[Copyright The Jiji Press, Ltd. Content edited and added by the Nippon.com editorial team.]