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
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.”
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.