Daily Management Review

Toshiba forecasts first profit in four years


02/14/2018


The Japanese industrial conglomerate Toshiba predicts the first profit for four years. As a result of the current fiscal year (to be completed in late March), the company expects a net profit of 520 billion yen ($ 4.86 billion), while previously losses were predicted at 110 billion yen. Analysts surveyed by Thomson Reuters I/B/E/S expect a profit of 187.84 billion yen.



danie via flickr
danie via flickr
Toshiba's upward revision of the forecast was associated with the sale of a loss-making subsidiary of Westinghouse Electric, a consortium of American hedge funds headed by Baupost Group. It is expected that this transaction will increase the capital of Toshiba by 410 billion yen ($ 3.68 billion) and provide additional tax benefits.

Previously, Toshiba forecast a negative amount of its own funds for the current fiscal year - about 750 billion yen. In September, the Japanese corporation agreed on the sale of Toshiba Memory, the world's second-largest maker of NAND memory chip, to a consortium led by Bain Capital investment fund.

The corporation put this business on sale amid growing losses of Westinghouse Electric Co LLC, the American division of Toshiba, which is engaged in nuclear power, now bankrupt. In January 2018, it became known that the investment company Brookfield Business Partners L.P. buys from Toshiba Corp. 100% Westinghouse Electric Company for $ 4.6 billion.

The agreement on the sale of Toshiba Memory has been signed, but there are a number of legal and legislative problems that may hinder the deal, which will be closed at best until the end of March 2018.

As a result of the current fiscal year, Toshiba predicts zero operating profit, while earlier it was talking about 440 billion yen. The forecast for annual revenue is down 22%, to 9.3 trillion yen.

Toshiba Corp. also announced appointment of a new chief executive officer and chairman of the board of directors. From April 1, 2018, these posts will be occupied by 60-year-old Nobuaki Kurumatani, who is currently president of the direct investment fund CVC Asia Pacific Japan, according to a press release from Toshiba. Prior to joining CVC in May 2017 Kurumatani was vice-president and board member of Sumitomo Mitsui Financial Group.

The current CEO and president of Toshiba, Satoshi Tsunakawa, will step down as CEO and become chief operating officer (COO), while retaining the post of president.

The company's management needs to restore investor confidence and find new opportunities for development without two key growth engines, namely, the division for the production of memory chips and business in nuclear energy.

As reported, on September 28 last year, Toshiba signed an agreement to sell a semiconductor business to a group of investors led by Bain Capital for 2 trillion yen. The deal is expected to allow Toshiba to achieve positive equity, but the company needs to implement the deal before the end of the current financial year, which ends in March 2018.

source: reuters.com






Science & Technology

NASA’s Mars Mission To Make Use Of Cold War-Era Atomic Rockets

Israel Completes Mars Habitat Simulation Experiment

Just $24 Earned By Hackers From The Huge Cryptojacking Campaign Conducted Last Week

New Molecule That Quickly Fights Cancer Cells Identified By Swedish Scientists

The U.K.’s Health Sector To Integrate Israeli ‘Digital Health’ Technology

Cryptocurrency Mining Malware Infects Government Websites In Multiple Countries All Across The World

New Research Into Space Settlement And Space Habitation Will Be Supported By Seed Grants Launched By UAE

NASA Confirms Mystery Satellite To Be Its IMAGE Satellite

Facebook To Put A Ban On Cryptocurrencies Ads

Study Show An Early Sign For Alzheimer's Is Sleep Disruption

World Politics

World & Politics

Ten Top Politicians To Be Investigated By Greek Parliament On Charges Of Taking Bribes From Novartis

The cloudy future of Saudi Arabia

Australia To Welcome Britain On The Latter’s Interest In Joining TPP

South African President Zuma Finally Resigns, New President To Be Elected Soon

13 countries with the best healthcare system

France is coming closer to Iran

India-Russia Develops Supersonic Missile Which Could Raise Concerns In China

Yet another serious political risk for Europe: Italian elections coming soon