Toshiba Forecasts $4B Loss For Current Fiscal Year, Plans To Cut A Third Of Its Headcount

Japanese electronics maker Toshiba Corp. on Monday said it expected to record a 440 billion yen ($4.5 billion) loss for the 2015 fiscal year and announced restructuring plans for its lifestyles segment including televisions, personal computers and home appliances. The conglomerate also announced plans to reduce its headcount by 6,800 employees or about a third of its global total by March 31, 2016.

Toshiba said it would close development, production and sales teams of its visual products business outside Japan. The company’s TV business in Asia would be shifted to a brand-licensing model and its TV-manufacturing plant in Indonesia would be transferred to two joint venture companies from Egypt. The company also detailed plans to scale back TV operations in Japan and reduce the number of indirect employees.

The unit focusing on consumer products, such as personal computers and televisions, has long been troubled and posted an operating loss of 42.5 billion yen ($350 million) in the first half of the fiscal year, which ended Sept. 30.

Toshiba, which makes everything from nuclear power equipment to laptops, home appliances and diagnostic equipment, hopes to revive profits by narrowing the scope of its operations. Toshiba also said it would look for buyers for its healthcare division in order to bolster the company’s ailing finances.

The company also canceled its dividend to shareholders for the year in a separate release on Monday.

However, the measures, part of Toshiba’s “Revitalization Action Plan” announced Monday, failed to cheer investors as the company’s stock plunged about 10 percent — its sharpest dive since May 2011, according to Bloomberg.

Pressure has mounted on Toshiba to shed unprofitable units after an accounting scandal at the electronics manufacturer early this year resulted in write-downs of about $1.3 billion and forced top management to resign. The Japanese conglomerate admitted in April it had been inappropriately inflating reported profits at several business units for years.

The company is finding it difficult to raise funds by selling shares or bonds to foot the bill for its restructuring effort as it has been blocked from raising capital through share offerings by the Tokyo Stock Exchange.

Toshiba has lost close to half its market value in the past eight months since the accounting scandal broke.