As expected, the electronics outfit Toshiba has seen a $3.52 billion loss in the nine months through December.
The loss is largely due to a goodwill impairment of around $5.28 billion on a US nuclear unit that came to light in late 2016.
The company hopes to keep the amount it owes from exceeding the value of its assets for the full year through March by selling part of its chip operations and taking other measures.
Toshiba will announce earnings for the April-December period tomorrow, along with a full-year outlook. The company is also expected to explain the cause of the losses, measures to avoid similar events and plans to rebuild its nuclear business.
Troubled Tosh, which was suffering from an accounting scandal, had to write-down of goodwill of CB&I Stone & Webster, a U.S.-based nuclear plant builder Toshiba acquired through U.S. subsidiary Westinghouse Electric in late 2015. Apparently, the world did not want nuclear power anymore and labour and materials costs were much higher than expected.
Toshiba overestimated the value of the company’s projects at the time of acquisition.
Now the company is rushing to flog off its semiconductor business to boost some capital.
But the problems are not just with the nuclear purchase. Toshiba is seen considering another goodwill write-down for Landis+Gyr, the world’s leading electric meter maker, which it acquired in 2011.
Toshiba had expected Landis, a Swiss company, to become a growth engine for its smart grid and smart community thrust, but its hopes have not materialized. It is expected to have to write down some of the value of this outfit too,
Troubled electronics maker Toshiba seems likely to be sailing to yet another accounting scandal.
A security watchdog suspects the Japanese conglomerate has misreporting profits by $339.59 million over three years.
It seems that the beancounters at Tosh add up just as well as we do. Not only is the just the latest of misreporting of figures the outfit has admitted it may face a multi-billion dollar writedown over its US nuclear business.
The Asahi Shimbun newspaper reported that the Securities and Exchange Surveillance Commission would present allegations of accounting fraud to prosecutors, who had previously declined to investigate due to a lack of evidence.
The watchdog found that Toshiba had reported profit gains in its computer operations during the 2012-2014 financial years, when the section had not generated any profit, the newspaper reported citing unidentified sources.
Toshiba’s two CEOs and a chairman at the helm of the company during that period were involved in the alleged cheating, it added.
The investigation could open the way to formal criminal charges against the company and its former executives.
Tosh is saying nuttin of course.
The number crunching software outfit named after something which ends up in a turkey at Christmas is doing rather well and announced that it has posted strong annual numbers.
Sage announced it had achieved its fastest rate of recurring revenue growth for a decade in its financial year ending 30 September 2016. Total revenues rose 9.3 percent to £1.57 billion, with growth of 6.1 percent. The UK and Ireland more than pulled their weight, with seven percent organic growth.
Recurring revenue growth hit 10.4 percent. Organic operating profit, meanwhile, rose 9.2 percent to £427 million.
Sage talked up its Sage Marketplace, a distribution platform that allows ISVs to showcase add-ons for its products, including Sage One and Sage Live, which it launched in February. More than 215 ISV apps have signed to Sage Marketplace during the year.
Sage Live, a cloud accounting solution based on Salesforce hardware was launched in the USA and UK in February, now has 600 customers, with over 400 added in the past 90 days, Sage boasted.
Pegg, which Sage bills as “the world’s first accounting chatbot”, has amassed 9,000 users for Sage in 125 countries since its launch in July, the LSE-listed vendor added.
Phase one of a transformation programme saw Sage cut general and administrative expenses as a proportion of revenue from 18.7 to 16.5 percent year on year and renew its senior management team, and is now complete, the vendor said.
Sage CEO Stephen Kelly said: “FY16 saw Sage continue to deliver on the commitment made at our June 2015 Capital Markets Day to perform and transform. The organic revenue growth of six per cent is driven by higher-quality recurring revenue, which grew at the fastest rate in a decade. The strategy is working – with customers embracing closer relationships with Sage, evidenced by a 46 percent increase in the number of subscription contracts and a contract retention rate of 86 percent.
Phase two of the transformation effort will focus on “driving more technology innovation and increasing focus on new customer acquisition”.
Workers at the troubled Toshiba are paying the price for their managers’ book cookery which could have won them a top price in the British Bake-Off.
Toshiba has said that more than 7,000 workers will be made redundant as a sacrifice to the accounting gods, which need to be appeased by the company’s antics.
Most of the 6,000-7,000 job cuts will be in the company’s lifestyle segment, which includes consumer appliances.
Toshiba is also looking to “drastically” reduce operations at its Ome factory, Tokyo, which makes televisions and personal computers, and is considering stopping developing televisions altogether.
The Japanese conglomerate’s chief executive, Hisao Tanaka, and a string of other senior officials resigned in July in the country’s biggest accounting scandal in years. An inquiry found that he had set up a pressurised corporate culture that prompted business heads to manipulate figures to meet targets.
The pressure increased when top managers set unrealistic targets for new operations because they were worried about the impact of the2011 Fukushima disaster on Toshiba’s nuclear division.
Toshiba is finding it tricky to move beyond its $1.3 billion accounting scandal.
The company has booked a $318 million net loss for the past financial year and pledged a bold restructuring.
The submission of its books, twice postponed due to its accounting woes, helped to allay concerns that the company was about to be delisted.
Shares in Toshiba rose 1.8 percent on Monday, but they are still down around 30 percent since its accounting problems were disclosed in early April.
Analysts warned that the company still had to tackle deep-rooted problems particularly what it was going to do with its unprofitable PC and TV businesses.
The accounting woes are also not going away because the company is facing shedloads of shareholder lawsuits.
The weaker assessment included a more conservative estimate on the value of its investment in South Texas Project, a US power plant project. The company, however, denied speculation that it would need to draw down deferred tax assets on Westinghouse, its US based nuclear business.
The company’s new Chief Executive, Masashi Muromachi, promised to announce a restructuring plan for its semiconductor, PC and TV businesses by the year end. He also said it was reconsidering plans by his predecessor, who stepped down amid the scandal in July, to grow the healthcare unit through acquisitions.
The company also announced on Monday that former Shiseido president Shinzo Maeda would be the head of a revamped 11 member board, the majority of which are external directors, pending approval at an extraordinary shareholders’ meeting at the end of the month.
Accounting mishaps that saw several top executives at Toshiba lose their jobs recently will lead the company to write off $802 million, it’s been reported.
According to Nikkei, the write off suggested by independent investors show there’s weakness in Toshiba’s semiconductor, appliances, and its Westinghouse nuclear wing.
The financial results are not finalised but a source told Nikkei that profits for the year up to March 2015 could be halved.
Toshiba bought a stake in Westinghouse in 2006 and wants to sell its stake in the business but it will be hard to find a buyer, in the wake of the Fukushima disaster.
The accounting “irregulaties” were apparently part of the Toshiba corporate culture and were only discovered when an external auditor reviewed its books.
Troubled electronics maker Olympus may be able to recover from a $1.7 billion accounting fraud without having to plead for help.
The company hassome interest in an equity alliance from several investors including Sony, but its nominee president claims it might not need the extra help to bail it out.
Hiroyuki Sasa has been nominated to take control over Olympus next month. He told Reuters that he is still looking at partnership with rivals Fujifilm and Terumo.
However, he said that he might not need to go ahead with an alliance or any kind of share issue to strengthen the firm’s battered balance sheet.
The scandal meant that more than $1 billion in investment losses were hidden from Olympus’s accounts for 13 years. This left the company with a tiny amount of equity capital.
While Sasa said the company still had a “sense of crisis” he will aim to boost Olympus’ equity ratio from just four percent now to around 30-40 percent.
Sasa is not popular with foreign shareholders because he is an “old face” at the company. The foreign investors want a whole new management team.
One of the top executives of Japan’s scandal-ridden Olympus appears to have hanged himself in a park outside New Delhi.
According to Reuters, Tsutomu Omori, 49, was head of Olympus’s medical equipment business in India. His body was found hanging from a boundary wall by a gardener in the park, which was part of an apartment complex in Gurgaon, just outside the capital, in Harayana.
Police have recovered two suicide notes written in Japanese. While one of them was meant for Omori’s family, the other note only said “I am sorry for bothering you” in Japanese.”
It is not clear if the death is related to the accounting fraud which has knocked Olympus for six. Omori was not one of the executives who was arrested in a sweep last week, nor does there appear to have been a request for him to be interviewed by Inspector Knacker of the Tokyo Yard.
One suspects that if shareholders were looking for people in the firm to perform any ultimate sacrifice over their antics in the accounting deal, Omori would have been well down the list.
Troubled Olympus, which is fighting to recover from an accounting scandal, forecast a $412 million full-year net loss.
According to Reuters, the outfit was dragged down in large part by its ailing camera business and it also had to start printing its real figures in the wake of the $1.7 billion accounting fraud.
The losses are not expected to put the dampers on investment partners becoming interested in the outfit. The company makes a killing from its endoscope business which saw its profit rise seven percent year-on-year during the quarter.
We suspect it might have to give up on cameras to satisfy the partners named as being interested including Fujifilm, Sony, Panasonic and Samsung.
Olympus President Shuichi Takayama has said news on any alliances must wait until new management is appointed after its annual shareholders’ meeting in April.
In December, Olympus filed five years’ worth of corrected earnings statements to satisfy regulators and shareholders. At the end of September its net assets were slashed by about a fifth and its declared profits were declared impossible,
The accounting scandal erupted when Olympus fired its British chief executive Michael Woodford on October 14, after he raised concerns about dubious book-keeping and was promptly fired for not doing things the Japanise way.
According to AP, Olympus is hoping that the April 20 shareholder meeting to mark a turning point in the scandal. Six of its 11 member board, including president Takayama, will quit.