Toshiba’s annual loss widens on writedowns

TOKYO: Toshiba Corp yesterday reported a record net loss in fiscal 2015 due to its writedowns of nuclear and other businesses as well as restructuring, as the embattled Japanese conglomerate strives to emerge from an accounting scandal.

Toshiba posted a group net loss of 483.23 billion yen ($4.44 billion) in the year ended in March, far higher than its loss of 37.83 billion yen in the previous year.

Sales fell 7.3% to 5.67 trillion yen in the 12-month period, while it logged an operating loss of 719.13 billion, compared with an operating profit of 188.41 billion a year earlier.

The operating loss was the largest ever for a Japanese company other than financial firms.

The company booked a restructuring cost of 110.5 billion yen and a special loss of 325.1 billion yen from asset writedowns including an impairment loss of 260 billion stemming from marking down the value of its US nuclear power subsidiary Westinghouse Electric Co.

But the company expects to return to profitability in the current year through next March, projecting a group net profit of 100 billion yen.

The company also expects an operating profit of 120 billion on sales of 5.10 trillion, down 9.0%, for the year.

“The company does not plan to book any major restructuring cost or asset writedowns in the current business year after it logged most restructuring related expenses in the last year,’’ Masayoshi Hirata, the chief financial officer, said at a press conference yesterday.

The upbeat forecast comes as the company is in the midst of intensive overhaul efforts such as job cuts and streamlining of group operations after admitting it had overstated profits for years.

In the wake of the scandal involving fraudulent accounting practices, Toshiba made downward revisions totalling around 230 billion yen to its pretax earnings over nearly seven years.

The company is now looking to focus on the energy, infrastructure and memory chip businesses under the leadership of the new president.

Toshiba also said yesterday that it would promote vice president Satoshi Tsunakawa to president in June, replacing Masashi Muromachi.Kyodo

Tsunakawa, 60, who assumed his current post in September, is credited with establishing the medical equipment unit as one of Toshiba’s mainstay businesses. After graduating from the University of Tokyo, he joined Toshiba in 1979.

Speaking at a press conference in Tokyo on Friday, Tsunakawa said his top priority would be to revitalise Toshiba by focusing its resources on growth areas and improving its financial standing.

“I have a heavy responsibility to lead (Toshiba) at a time when we are facing the most severe situation since our founding,” he said.