Toshiba has warned that it is facing annual losses of over £7 billion, and the future of the company is in doubt as a result of financial difficulties at its nuclear power plant construction business.
Toshiba has released its third quarter results, after twice delaying publication while auditors attempted to quantify the scale of the problems at Toshiba’s Westinghouse subsidiary, which filed for bankruptcy last month. The unaudited results showed Toshiba’s total losses widened by £390 million to £3.9 billion in the nine months ending December 2016, adding that losses for the full year ending March 2017 could be over £7.3 billion. It would be one of the biggest losses in Japanese corporate history.
The company said in a statement: “There are material events and conditions that raise substantial doubt about the company’s ability to continue as a going concern.”
Failure to file audited results fuelled speculation that the company could be forced out of the Tokyo Stock Exchange. Staoshi Tsunakawa, President of Toshiba, said that the auditor’s decision not to approve the figures “truly regrettable”, and he said that he hoped that the company would not be delisted. Toshiba is attempting to strengthen its balance sheet by selling other assets, including its memory chip business.
Toshiba’s crisis has increased fears about the future of its planned Moorside nuclear power plant in Cumbria, UK. Earlier this month, it was forced to take full control of Nugen, the venture behind the project, after its previous partner, the French utility Engie, sold its 40 per cent stake under an option triggered by Westinghouse’s bankruptcy filing.