Toshiba Reports Record Loss
Japanese chipmaker Toshiba Corp on Friday reported larger-than-ever losses and projects that it will not post a profit this year amidst declining global demand for computer chips as a result of the recession.
Toshiba posted a net loss of 343.6 billion yen ($3.5 billion) in March, compared to a profit of 127.4 billion yen the previous year.
Revenue fell 13 percent to 6.65 trillion yen ($67.2 billion), and the company reported an operating loss of 250.2 billion ($2.53 billion) for the year, compared to a profit of 246.4 last year.
The report represents the company’s first loss in seven years.
"The economic downturn has appeared to hit bottom but we are not seeing a recovery yet," said Fumio Muraoka, vice president of Toshiba.
"We cannot expect a rapid rebound."
Toshiba posted a net loss of 84.0 billion yen ($1.9 billion) on sales totaling 1.67 trillion yen ($185.7 billion) during the most recent quarter, which ended in March.
The company referred to "the shrinkage of the overall market caused by the fast-spreading global recession, steeper than expected declines in semiconductor prices."
Additionally, Toshiba said it is forecasting another year of net loss, with an estimated loss of 50 billion yen ($505 million) for the fiscal year ending March 2010.
"Projections indicate that the business environment will remain in severe condition" throughout the year, Toshiba said in a statement.
Toshiba said sales would see a small increase to about 6.8 trillion yen ($68.7 billion).
In January, the chipmaker announced it would eliminate the jobs of 4,500 contract workers by the end of March. The company now has plans to cut an additional 3,900 more contract jobs until March 2010, company spokesman Keisuke Omori told the Associated Press.
The cutbacks are expected to save as much as 300 billion yen ($3 billion) from research and development, investment and personnel costs.
Furthermore, Omari said the company hopes to increase its capital by about 500 billion yen ($5.1 billion) through a public stock offering and issuance of subordinated bonds.
"We want to improve our financial standing as quickly as possible so that we can focus on growth," he said.
—
On the Net: