Toshiba in overhaul mode, may post $4 billion net loss
By Staff Writer
Japanese global major Toshiba is mulling over a restructuring plan. The company has been facing a turbulent situation and suffering from losses. The company is expected a whopping net loss of Yen 500 billion ($4.13 billion) on restructuring costs.
Toshiba is struggling with the fallout from an accounting scandal. Toshiba may also offload some stake in its semiconductor unit.
Toshiba, the manufacturer of laptops to nuclear power, is exploring ways to analyze the impact of restructuring measures on its business for the financial year ending March 2016.
The Nikkei business daily has reported that Toshiba expects to forecast a record level net loss of $4.13 billion (Yen 500 billion) for the current fiscal owing to restructuring costs.
Reuters reports that Toshiba's Board of Directors will decide on the restructuring plan and its impact on the business. Company sources reveal that the restructuring plan will incur a significant loss. Toshiba's stock dropped nine percent to Yen 257 on Monday, while Japan's Nikkei index eased 1.3 percent.
Analysts feel that Toshiba has overstated its earnings by $1.3 billion as far back as fiscal 2008 as the Japanese major is facing adverse conditions for some time.
Toshiba President Masahi Muromachi in November hinted that the company might offload some stake in its semiconductor unit, which is making profits. It makes flash-memory chips to smartphone manufacturers.
According to a report by The Wall Street Journal (WSJ), Toshiba will soon announce the restructuring plan and overhauling its money-losing business. Toshiba's unit is focusing on consumer products including personal computers and televisions. The unit posted operating loss of Yen42.5 billion for the first half ending September 2015.
The accounting scandal-hit Toshiba is believed to have drawn an overhaul plan to relocate some workers and announce early retirements for some workers. The restructuring plan assumes significance following revelations this year that the electronics major inflated profits for about seven years.
The Japan Times has reported that Toshiba might slash thousands of jobs and sell Toshiba Tec as part of its restructuring plan. The Japanese major is considering a plan to overhaul its loss-making businesses including television, personal computers, and white goods.
Toshiba may downsize Ome complex in west Tokyo, which manufactures televisions and personal computers. Coming to its global TV business, Toshiba may also sell a plant in Indonesia to a foreign manufacturer. Other units in the list of offloading include Toshiba Tec Corp, which is Tokyo-listed subsidiary and manufactures office equipment.