The Yomiuri ShimbunToshiba Corp. said Tuesday it has bounced back into the black for the first time in four years, booking a record consolidated net income of ¥804 billion for fiscal 2017 due mainly to asset sales of bankrupt U.S. nuclear plant maker Westinghouse Electric Co., a former subsidiary. The figure compares to a loss of ¥965.6 billion a year earlier.
It was also the first time in seven years that the Japanese company logged a record-high net income.
Toshiba’s improved finances resolve its excess liabilities, helping the company retain its place on the Tokyo Stock Exchange.
Toshiba’s net sales, however, declined 2.4 percent to ¥3.95 trillion from a year earlier, largely because of the sale of an affiliated Swiss power meter company.
At the end of 2016, Toshiba was found to have suffered huge losses because of Westinghouse. Toshiba’s liabilities exceeded its assets by more than ¥500 billion at the end of March 2017, raising fears it would be delisted from the TSE if, under the rules of the exchange, it was unable to eliminate its net liabilities by the end of March 2018.
To improve its finances, Toshiba issued new shares through third-party allotments bought by foreign investment funds, among others, raising about ¥600 billion at the end of 2017.
It also settled its company guarantee obligations for Westinghouse with U.S. utilities. This lowered Toshiba’s taxable income and significantly reduced its corporate tax bill. Due to these factors, Toshiba shareholders’ equity was out of the red at the end of March, at ¥783.1 billion.
Toshiba said it expected a net income of ¥1.07 trillion for the current fiscal year ending March 2019, counting on the sale of its semiconductor memory subsidiary Toshiba Memory Corp.