TOSHIBA COMPANY ENDED THE FISCAL YEAR AT A LOSS

The fiscal year that ended on 31 March brought a loss of 114.6 billion yen (about $ 1.05 billion) to the Japanese Toshiba. The company, having analyzed the experience of 2015, did not hide its problems - then the billions of losses were hidden from the shareholders, and the president of the corporation and some of the top managers lost their positions.

The media were reminded that the previous fiscal year of 2018 was much more successful, as the company managed to finish it with a profit of $ 9.2 billion. Now the experts are wondering how the securities market will react to such news.

The analysts emphasize that the main factor that has negatively impacted the corporation’s 8% decline in sales is the sale of a liquefied natural gas (LNG) business, located in the United States.

In 2017, a subsidiary of the Westinghouse Electric Company located in the US was subjected to the bankruptcy and restructuring proceedings.

However, the drop in sales might be connected not only with the alienation of the LNG business in favor of the French company Total. A number of experts point to the losses that Toshiba could have had due to the problems with the microchip business. The company has about 40% of its assets concentrated in it. What is more, the plans of the Japanese giant indicate a possible sale of another subsidiary, working in the field of nuclear energy in the UK.

All the above-mentioned problems of the Japanese corporation, as the experts note, threaten to further dismissals of about 7 thousand employees, working in various fields of production. The fact that things in the company are not going well is also shown by the stock market.

The revenue of the company was reduced by 8.2%.

In the published financial statements its sum is about 3.4 trillion yen. Since the beginning of 2020, the stock prices have fallen significantly, reducing Toshiba's capitalization by 13.5%. The corporation is currently valued at 1.4 trillion yen.

In the next fiscal year, the company expects significant reductions in revenue and operating profit. The financiers suggest that revenue will decrease by 6.2%, amounting to just over 3 trillion yen at the end of the year. Operating profit will also be reduced by 16%. According to the experts, it will amount to about 110 billion yen. It is possible that the negative factors of the market conditions, caused by the global economic crisis and the consequences of the pandemic, will affect the company as well.

However, the corporation plans to benefit from the measures, introduced to combat the pandemic.

The representatives of the corporation stated that one of the subsidiaries in Hokkaido Prefecture would be engaged in production of the test systems for diagnosing the coronavirus and detection of antigens in the organisms of patients.

The organization of production at the enterprise will be undertaken by another well-known manufacturer, Hitachi. It is expected that the release of the rapid tests with a volume of up to 400 thousand units will be adjusted by December 2020.