Toshiba delays earnings; chairman to step down

Toshiba delays earnings; chairman to step down”

Toshiba chairman Shigenori Shiga announced he was stepping down after the company said it was on track to announce losses of 390bn yen (£2.7 billion) for the year to March.

Toshiba said it expected to book a 499.9 billion yen ($4.4 billion) net loss for the nine months to December, and a 390 billion yen net loss for the full year.

The Japanese giant said in a provisional results presentation to investors Tuesday that "Toshiba will consider participating in the project without taking on any risk from carrying out actual construction work".

The earnings results came after a chaotic afternoon, which began when the company missed its own deadline for announcing earnings.

Toshiba also says it will sell more of its semiconductor business than previously planned.

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The company said it was in talks with United States regulators to receive approval to delay its earnings report until 14 March, as it continues to probe the Westinghouse business it acquired 10 years ago.

Toshiba, which is trying to hasten the process of spinning off its semiconductor business, plans to seek approval at an extraordinary meeting of shareholders to sell some of the new venture's shares to boost its capital.

As a result shareholders' equity at the end of December was minus $1.7 billion.

Said analyst Masahiko Ishino at Tokai Tokyo Securities: "The questions surrounding Toshiba are so numerous, where do you even begin?"

The not-so-pleasant financial situation of Toshiba was triggered by the Westinghouse Electric subsidiary after, in 2015, the company auctioned Chicago Bridge and Iron.

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To end litigation over cost overruns, Westinghouse in 2015 made a deal to acquire Stone & Webster, its construction partner on the USA nuclear projects.

We've known for weeks that Toshiba was in rough shape and seeking to raise additional revenue through a potential partial sale to Western Digital, but events on Tuesday pushed the company's position from "really bad" to "implosion imminent".

Westinghouse was behind the acquisition of a USA construction company, CB&I Stone & Webster, in 2015.

With the announcement of a further delay, the stocks slumped again, this time losing more than 9 per cent.

The company also predicts an operating loss of 410 billion yen, although it forecast an operating profit of 180 billion yen three months ago.

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In a shocking omission, Tsunakawa said that Toshiba's acquisition of Westinghouse, which signaled the company's move into the nuclear sector in 2006, was a misstep and a contributing factor to its current problems.

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