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After a five-hour delay, Toshiba has finally unveiled a $6.3bn nuclear writedown.
The company announced that Shigenori Shiga, the chairman of Toshiba, will step down after the struggling Japanese industrial group warned that it would book a ¥712.5bn ($6.3bn) writedown to reflect massive cost overruns and delays linked to several nuclear projects in the US.
For the full year through March 2017, the company said it anticipates a net loss of Y390bn compared to an earlier forecast of a Y145bn profit.
Nuclear experts say the financial mess engulfing Toshiba will cast a serious shadow over the future of the global nuclear industry as the economics of building nuclear plants crumble under rising safety standards and declining oil prices.
Toshiba first flagged the risk of a multibillion-dollar write-off in late December, related to goodwill on Westinghouse’s $229m purchase last year of US construction contractor Stone & Webster from Chicago Bridge and Iron.
The goodwill, originally estimated at just $87m, snowballed due to rising material and labour costs in completing the two US nuclear plants in Georgia and South Carolina, according to company executives.
The large writedown will be the second relating to Toshiba’s US nuclear business, after it booked a goodwill impairment charge of $2.3m related to its acquisition of Westinghouse last April.
Shares fell 8 per cent on Tuesday as Toshiba sought a one-month extension of its earnings deadline to complete an auditor review of its results, after failing to publish the financial figures at noon in Tokyo as originally planned.
The latest delay came as the company said lawyers were examining claims by a whistleblower that Westinghouse mishandled the S&W acquisition.