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Infineon, the German chipmaker, on Tuesday reported worse-than-expected losses for the fiscal third quarter as it struggled to distance itself from a bribery scandal involving a former board member who resigned earlier this month.

Infineon said it had appointed Ernst & Young to “externally analyse the internal information and controlling systems”. The auditor has been tasked with establishing whether any weak points in procedures might have prevented the early detection of the alleged irregularities.

Andreas von Zitzewitz resigned on July 16 from the executive board, and state prosecutors have said the evidence reviewed so far “confirms the suspicion of payments” linked to sports sponsoring.

Infineon is not being investigated and is co-operating with the judicial authorities. But it is struggling to dispel criticism that it failed to take more decisive action when the allegations first surfaced last year.

Wolfgang Ziebart, chief executive, on Tuesday sought to refocus attention to Infineon's operating business, which he said was unaffected by the affair.

But results for Infineon's third quarter offered only limited comfort. Price erosion in the core D-Ram memory chip business, combined with restructuring charges, saw operating losses widen to €234m ($281m) in the three months to the end of June, double those seen the previous quarter, and wider than analysts had expected.

Infineon expects prices for D-Rams, which generate 40 per cent of its sales, to stabilise during the current quarter, and said restructuring costs would be less than half the €81m accumulated in the third quarter. It no longer expects to break even at the operating level this fiscal year.

“These results are of course not satisfying but where it was within our control we made a lot of progress,” said Mr Ziebart.

Since taking over last September, Mr Ziebart has been seeking to cut costs and shed some non-core activities. Infineon is looking at all options for the core memory chip unit, including a possible flotation, Mr Ziebart said.

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