TOKYO (BLOOMBERG) - Shares of Toshiba Corp slumped the most in seven months after reports it would post a record 500 billion yen (S$5.82 billion) loss in the current fiscal year on costs related to an accounting scandal, layoffs and sales of business units.
Shares of the industrial conglomerate fell as much as 9.5 per cent, the most since May 11, as of 9.06am in Tokyo trading. Toshiba will discuss the impact on earnings of plans it will announce as early as Monday, it said in a statement after media including the Nikkei newspaper reported it would post a loss that includes 200 billion yen in restructuring costs.
Toshiba, which makes everything from nuclear power equipment to laptop computers, semiconductors and home appliances, may seek to revive profit by narrowing the scope of its business lines. The expected revamp comes after the company mislead investors by 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.
Net income will probably be about 56.6 billion yen for the 12 months ending March, based on analyst estimates made before the media reports on Dec 19 and 20, compared with a 37.8 billion yen loss the previous year. Among 19 analysts covering the company, four rate it buy, 10 say hold and five say sell.
Toshiba president Masashi Muromachi is working with new top management after former presidents Hisao Tanaka, Norio Sasaki and Atsutoshi Nishida resigned in July to take responsibility for the accounting irregularities.
Toshiba itself still faces lawsuits from shareholders, while it has vowed to avoid recurrence by bringing in more outside directors and it has 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 in October and has sold stakes it held in Finnish escalator maker Kone Oyj and Japanese medical equipment manufacturer Topcon.
Toshiba has also said it is considering combining its PC operations with those of Fujitsu and Sony spin-off Vaio. It's also considering a deal with struggling display-maker Sharp to combine washing machine and refrigerator operations.
In September, Mr Muromachi won shareholder approval to lead the company at an extraordinary meeting that included calls for his resignation. Investors angered by damage done to the company interrupted proceedings several times, shouting over the president.
Mr Muromachi in September pledged to prune underperforming businesses, including workforce reductions in appliances, PCs, TVs and semiconductors. Toshiba had about 198,700 employees as of March 31, the lowest since at least 2009, according to data compiled by Bloomberg.