Toshiba Corp. forecast a record ¥550 billion loss for the current fiscal year following an accounting scandal and is now planning 7,800 job cuts and restructuring businesses that include televisions, personal computers and home appliances.
The figure would eclipse the firm’s largest net loss to date of ¥398.8 billion posted in the year through March 2009 in the aftermath of the global financial crisis.
“I will take the leadership so Toshiba will start anew as a company that can gain public trust,” President Masashi Muromachi said at a news conference.
Toshiba’s sweeping review of its money-losing divisions comes in the wake of the company’s systematic overstating of profits for nearly seven years. It also comes at a time when Japanese electronics makers are struggling to compete with Chinese and South Korean rivals.
Toshiba is narrowing the scope of its business lines after filing false financial statements, partly to conceal the waning performance of its personal computer operations, a mainstay within the electronics and power equipment maker’s consumer brands. The company said Monday it is pruning its TV and PC businesses to sharpen its focus on energy and memory and will keep selling off property and investments.
Shares of the industrial conglomerate fell as much as 9.8 percent, the most since May 11, to close at ¥254.8 in Tokyo trading before the announcement.
The company has lost about $9 billion, half of its market value, over the past eight months as shares plunged after initially announcing the accounting probe more than eight months ago.
President Muromachi is working with new management after former Presidents Hisao Tanaka, Norio Sasaki and Atsutoshi Nishida resigned in July to take responsibility for the accounting irregularities. The company said it will seek damages in a lawsuit against former executives, including the three, and two former chief financial officers, over their role in the scandal.
Toshiba itself still faces lawsuits from shareholders, while it has vowed to avoid a recurrence by bringing in more outside directors and it has cut executive pay.
Regulators have yet to announce results of probes seeking evidence for possible criminal prosecutions of former executives.
Toshiba announced the sale of its image-sensor chip operations to Sony Corp. in October and has sold stakes it held in Finnish escalator maker Kone Oyj and Japanese medical equipment manufacturer Topcon Corp.
Toshiba had about 198,700 employees as of March 31, the lowest since at least 2009, according to data compiled by Bloomberg.
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