Toshiba Corp will on Tuesday detail a writedown of close to $6 billion after bruising cost overruns at its U.S. nuclear arm, turning investor attention to the Japanese group’s efforts to fix that and other balance sheet headaches. The TVs-to-construction conglomerate warned of a potential multi-billion dollar nuclear writedown in December, a year after a $1.3 billion accounting scandal. Sources familiar with the matter say the final charge, to be detailed alongside quarterly earnings, will be as high as 700 billion yen ($6.2 billion), a sum which alone would wipe out the company’s shareholder equity. Toshiba, which has seen its market value almost halve since the prospect of a writedown emerged in December, is also expected to outline the prospects for its nuclear arm and update investors on efforts to raise capital, including through the sale of a stake in its flagship memory chips business.
Reuters 13th Feb 2017 read more »
Toshiba is facing a difficult conundrum as the Japanese industrial conglomerate prepares to unveil the scale of its multibillion-dollar writedown to its struggling US nuclear business this week. On Tuesday it will put a figure on the precise goodwill write-offs related to Westinghouse’s $229m purchase last year of US construction contractor Stone & Webster from Chicago Bridge & Iron. Investors have been waiting since Christmas for the promised clarity, which will far exceed the $87m goodwill charge originally forecast. The write-offs are down to still-unresolved delays and legal wranglings over two projects in the US. Toshiba’s lenders will need the company to pin down the exact size of the write-off, which analysts warn could be as large as $7bn, to judge whether they can continue offering their loans. But analysts warn that without an end in sight, nuclear experts say it will be virtually impossible for Toshiba to come up with an accurate estimate of future costs to which the company is exposed. That would leave the already cash-strapped group mired in even deeper financial trouble.
FT 12th Feb 2017 read more »
A few weeks ago, far off the beaten path in the Midlands, one of the largest construction cranes on the planet gently hoisted a 750-ton steam generator into place as part of the V.C. Summer Nuclear Station expansion. The heavy lifting isn’t over. In some ways, it could be just beginning for the various players immersed in the long-delayed $14 billion project, especially South Carolina Electric & Gas. For the moment, much of the focus is on Westinghouse Electric, the engineering, procurement and construction contractor at the rural V.C. Summer project site. Questions about its role have been swirling since late December, when parent company Toshiba Corp. dropped a post-holiday bombshell by announcing it will take a write-off that’s expected to total at least several billion dollars. The exact figure will be disclosed Tuesday.
Post and Courier 11th Feb 2017 read more »