Toshiba chairman resigns as company projects 713b yen write-down

The company has projected a write-down of its nuclear subsidiary Westinghouse, with chairman Shigenori Shiga accepting responsibility for the financial troubles.

Toshiba Corp has projected a 712.5 billion yen write-down, postponed its earnings report, and announced that its chairman Shigenori Shiga is stepping down -- all in the space of a day.

The multibillion dollar write-down of Toshiba's US nuclear subsidiary Westinghouse Electric wipes out shareholder equity and drags the company to a full-year loss for the second year in a row.

Shiga has accepted full responsibility for Toshiba's financial challenges and operating losses.

Estimated unaudited figures projected a net loss of 390 billion yen for the fiscal year ending in March 2017, compared with a net profit of 145 billion yen estimated in November.

The company also projected an operating loss of 410 billion yen, although it forecast an operating profit of 180 billion yen three months ago. Sales are estimated at 5.52 trillion yen, up from 5.4 trillion yen.

Fully audited numbers are now due on March 14 after Toshiba was granted a one-month extension for its formal filing by regulators in Japan.

Explaining its request to delay formal filing [PDF], which sent Toshiba's shares down by 8 percent in Tokyo, the company said it needed additional time for lawyers to examine Westinghouse's $229 million acquisition of CB&I's construction arm in 2015.

In January, it was reported that Toshiba might be selling a majority stake in its flash memory operations to cover losses caused by the massive write-down of its nuclear business.

Toshiba president Satoshi Tsunakawa will also be taking a pay cut to alleviate some of the company's financial woes.

The company is expected to restructure its nuclear business, though nothing has been confirmed yet.

In 2015, Toshiba delayed planned earnings releases twice as it reeled from a 150 billion yen accounting scandal where the company overstated its profits over the course of seven years.

Former Toshiba president Hisao Tanaka and his predecessor Norio Sasaki quit in the wake of the scandal, which was blamed on management's overzealous pursuit of profit.

More than a year ago, as part of another major restructuring effort, Toshiba sold off its PC business and let go thousands of employees.

With AAP