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BCN-24
JAPAN-NUCLEAR-ELECTRONICS-TOSHIBA-EARNINGS
Japan’s Toshiba cuts profit outlook again
TOKYO, Feb 13, 2019 (BSS/AFP) – Struggling Japanese engineering firm
Toshiba lowered its profit forecasts Wednesday with rising costs weighing on
its energy operations.
The fresh downgrade comes as the firm undergoes painful reforms to stay
afloat after logging billions of dollars in losses from its disastrous
acquisition of US nuclear firm Westinghouse.
Having sold its lucrative chip making business, Toshiba also saw sharply
lower operating profit over the past three quarters compared with the
previous year, though proceeds from the sale boosted its net profit over the
nine-month period.
For the year to March, Toshiba said it now expects a net profit of 870
billion yen ($7.86 billion), down from a November estimate of 920 billion
yen.
In May, the company issued its original annual net profit forecast at 1.07
trillion yen.
The drop was due in part to a so-called goodwill impairment associated
with falling share prices of a subsidiary, but also higher costs at a
domestic power transmission and distribution project, the company said.
Toshiba also cut its annual operating profit to 20 billion yen, while
slightly increasing its annual sales projection to 3.62 trillion yen.
The Tokyo-based company used to sell everything from rice cookers to
nuclear plants and has long been a household name.
But a series of scandals and business losses in recent years have forced
the company to withdraw from many operations, such as appliances and personal
computers that gave it brand recognition.
To stay afloat, the cash-strapped group sold its lucrative chip business
for $21 billion to K.K. Pangea, a special-purpose company controlled by a
consortium led by US investor Bain Capital.
Still, the company is scrambling to revive itself, having announced in
November plans to slash 7,000 jobs, to scrap or consolidate some factories
and reduce its subsidiaries, to liquidate a unit building a UK nuclear power
plant, and to withdraw from a US-based liquid natural gas business.
BSS/AFP/HR/1125