Toshiba predicts record $4.5bn loss
21 December 2015
- From the section Business
Troubled Japanese conglomerate Toshiba has said it will report a record 550bn yen ($4.5bn) annual loss and cut 6,800 jobs as it carries out a restructuring.
The company, whose activities range from laptops to TVs to nuclear energy, is shedding the jobs in its consumer electronics division.
News of the predicted losses sent shares in Toshiba down by nearly 10%.
The restructuring comes after Toshiba admitted earlier this year that it had overstated profits for six years.
The scandal led to the resignation of Toshiba’s president and vice-president. Masashi Muromachi took over as chief executive and president from previous president Hisao Tanaka.
As part of its restructuring, Toshiba will sell its TV and washing machine manufacturing plant in Indonesia to Hong Kong-based TV maker Skyworth for about 3bn yen. It is also looking for investors for its healthcare business.
The 6,800 job cuts will go in its Lifestyle division, essentially its consumer electronics business, and Toshiba said the cuts would be made by March 2016.
A number of jobs will be lost by offering early retirement to those employed in Japan.
Toshiba, which was founded in 1875 and launched the world’s first mass-market laptop in 1985, currently employs almost 200,000 people.
Its shares have lost about 40% of its value since news of the profit overstatement began to emerge in April.
Some of Toshiba’s problems go back to the tsunami which hit Japan in 2011. This struck the Fukushima Dai-ichi nuclear power plant, which it operates and is decommissioning with Hitachi and other companies.
Toshiba has not yet fully calculated the impact of the nuclear disaster on its books.
This post was written by FSB News