TOSHIBA SEES RE­TURN TO THE BLACK

Ja­pan firm ex­pects 520 bil­lion yen net profit for the year to March, re­vers­ing 966 bil­lion yen net loss pre­vi­ously

New Straits Times - - BUSINESS / WORLD -

TROU­BLED Ja­panese con­glom­er­ate Toshiba said yes­ter­day it would swing into the black for the full fis­cal year as it com­pletes the multi-bil­lion-dol­lar sale of its chip busi­ness to re­store its bal­ance sheet.

The firm said it now ex­pects a net profit of 520 bil­lion yen (RM19.22 bil­lion) for the year to March, re­vers­ing a net loss of 966 bil­lion yen a year ear­lier.

Toshiba, which had ear­lier ex­pected a full-year loss, up­graded its bot­tom line es­ti­mate as it fac­tored in a drop in tax ex­penses as­so­ci­ated with the sale of the prized chip busi­ness to a con­sor­tium led by Bain Cap­i­tal.

The up­ward re­vi­sion was also helped by the sale of United States nu­clear en­ergy firm West­ing­house, which had long pres­sured Toshiba's earn­ings be­cause of its mas­sive losses.

Among other fac­tors be­hind the re­vi­sion was last year’s is­suance of 2.28 bil­lion new shares to raise a to­tal of 600 bil­lion yen, a move aimed at avoid­ing a hu­mil­i­at­ing delist­ing from the Tokyo bourse.

“These out­comes have suf­fi­ciently ad­dressed the ma­te­rial events and con­di­tions that raised sub­stan­tial doubts about the com­pany’s abil­ity to con­tinue,” said Toshiba in a state­ment.

The firm made its fore­cast as it an­nounced that in the nine months to De­cem­ber it saw a net profit of 27 bil­lion yen, re­vers­ing a 532.5 bil­lion yen loss for the same pe­riod last year.

Toshiba has been on the ropes af­ter the dis­as­trous ac­qui­si­tion of West­ing­house, which racked up bil­lions of dol­lars in losses be­fore be­ing placed un­der bank­ruptcy pro­tec­tion.

Ear­lier in the day, Toshiba an­nounced that Nobuaki Ku­ru­matani, for­mer deputy pres­i­dent of Su­mit­omo Mit­sui Bank­ing, would take over as its new chief ex­ec­u­tive of­fi­cer.

Cur­rent chief Satoshi Tsunakawa will stay on as chief op­er­at­ing of­fi­cer.

“Any ex­cel­lent com­pany has had dif­fi­cult times in its his­tory, and Toshiba has had an ex­tremely dif­fi­cult time in re­cent years,” said Ku­ru­matani.

The re­place­ment came as Toshiba said it had un­cov­ered fur­ther ac­count­ing ir­reg­u­lar­i­ties, this time at its Toshiba Tec over­seas unit.

Work­ers in­flated prof­its to the tune of €4.7 mil­lion (RM22.76 mil­lion), Toshiba said, adding that it would work to “fur­ther strengthen our in­ter­nal man­age­ment.”

EPA PIC

Toshiba Corp out­go­ing pres­i­dent and chief ex­ec­u­tive of­fi­cer (CEO) Satoshi Tsunakawa (right) and newly ap­pointed CEO and chair­man Nobuaki Ku­ru­matani at a news con­fer­ence in Tokyo yes­ter­day.

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