Japanese conglomerate Toshiba, owner of U.S.-based nuclear power giant Westinghouse Electric Company, released their twice-delayed financial report for the third fiscal quarter of 2016 on Tuesday, projecting losses of $9.2 billion for the year. The figures, which were not signed off on by the company's auditor, is based on a $4.8 billion loss for the first nine months of the year, plus skyrocketing losses at Westinghouse due to that company's Chapter 11 bankruptcy protection filing, Toshiba said.
Westinghouse filed for bankruptcy protection earlier this month. That company's purchase of nuclear construction company CB&I Stone and Webster (S&W) in 2015, however, has caused Toshiba's auditor PricewaterhouseCoopers Aarata to refuse to sign the report as the auditor said it cannot guarantee numbers related to that deal. Westinghouse and CB&I, the previous owner of the construction company, are at odds concerning the value of the company.
Toshiba President Satoshi Tsunakawa apologized for the unaudited report, which the company released fearing further delays could cause the company to be delisted from the Tokyo Stock Exchange. He also said it was “truly regrettable” that PricewaterhouseCoopers would not sign off on the report.
Toshiba said that its other businesses – it owns more than 600 of them – were “fairly healthy.” It is primarily known as an electronics company with a lucrative memory chip business. Toshiba has shopped around the idea of selling that business and others with the hopes of pulling itself back into a leading position in Japanese and world markets. Currently, however, Toshiba has backed away from selling its money-making chip business in favor of a protection filing at Westinghouse and other asset sales.
Analysts are citing several factors that turned against Westinghouse, all of which are familiar to the nuclear power industry. They include a market slump after the Fukushima Daiichi nuclear generating station disaster in March 2011, competition with cheap natural gas and heightened safety regulations that caused construction costs to soar.
Toshiba and Westinghouse have both said that the only construction projects that would be affected by the company's financial woes would be domestic projects in the United States. Westinghouse is currently building four AP1000 nuclear reactors in the United States and four in China. The U.S. projects are in Georgia and South Carolina – both two-reactor plant expansion projects at Plant Vogtle and V.C. Summer. The two in China involve two-reactor projects at Sanmen and Haiyang.
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