Toshiba has unexpectedly delayed the release of a key earnings report and details of its rumoured withdrawal from overseas nuclear projects – including one in the UK – amid reports that it could suffer net losses of 500 billion yen ($4.4bn).

The delay sent shares in the Japanese conglomerate down by 8% in Tokyo, and added to speculation that its financial problems could become an existential crisis.



Toshiba’s chairman, Shigenori Shiga, is to resign to take responsibility for the massive writedown looming over its troubled US nuclear subsidiary, Westinghouse Electric, according to Japan’s public broadcaster NHK. Shiga, whose resignation was expected, is a former chairman of Westinghouse.

Toshiba was scheduled to release details of its writedown of Westinghouse on Tuesday afternoon, followed by a press conference by its president, Satoshi Tsunakawa.

But in a brief statement, the company said it was “not ready” to release the report, a delay some have interpreted as a sign that the company is in even deeper financial trouble than it has previously reported. Toshiba later said it had asked regulators to allow it to delay the release of its earnings and details of the nuclear writedown by a month while it investigates possible managerial wrongdoing at Westinghouse.

Tsunakawa signalled this month that new nuclear projects would be reviewed in response to the anticipated multibillion-dollar writedown related to the purchase of a nuclear construction and services business by Westinghouse.

The company was expected to confirm on Tuesday that it is withdrawing from new nuclear projects outside Japan, dealing a blow to plans for the planned power station at Moorside in Cumbria.

Westinghouse, Toshiba’s US-based nuclear developer, produces the AP1000 reactors that were to be used at the £10bn station at Moorside, near Sellafield. Toshiba also has a 60% stake in NuGen, the company that was to build the Moorside facility.

Toshiba is rumoured to have approached Korea Electric Power as a potential buyer for its stake in NuGen, according to the Nikkei business paper.

The construction of a new nuclear station in the UK had carried hopes of creating thousands of jobs and boosting the country’s energy security. Instead, Toshiba’s withdrawal from the UK nuclear power market would leave a gaping hole in the British government’s nuclear strategy, said Rebecca Long-Bailey, the shadow business secretary.

“The government’s energy policy is in chaos. We have become increasingly reliant on the decisions of foreign companies whose interests lie with their owners and not British consumers,” Long-Bailey said. “If Toshiba pulls out … the government must intervene immediately and provide public support and financial stability for Moorside and the community of west Cumbria.

“That means taking a public stake in exchange for public support to protect energy supplies and jobs. Labour backs new nuclear and an expansion of renewable energy to keep the lights on and meet our climate change targets.”

Hours before Toshiba cancelled its earnings announcement for April-December, the Nikkei said the company was preparing to warn that it may not be able to continue as a “going concern” as a result of massive losses linked to Westinghouse and doubts about its restructuring plans, but did not provide details.

“The delay shows that the company is in a mess,” said Makoto Kikuchi, chief executive of Myojo Asset Management. “We can assume that the company is not delaying its earnings release for good news. The market speculates that Toshiba will be releasing figures worse than what is being reported already.”

The delay follows growing expectations that the charge for the writedown in its US nuclear business could be as high as 700bn yen ($6.2bn) – enough to wipe out the group’s shareholder equity.

During the past few decades, Toshiba has been wholly or partly involved in the construction of 20 nuclear reactors in Japan, none of which is currently operating following the triple meltdown at Fukushima Daiichi in March 2011.

Westinghouse has built 91 reactors around the world, of which 67 are still operating, 12 are closed and four are in long-term outage.

Toshiba’s withdrawal from the Moorside project “will see all parties with a vested interest running to the government in a desperate bid to secure billions in taxpayers’ funding”, said Shaun Burnie, senior nuclear specialist at Greenpeace Germany. “Decades ago the nuclear industry moved into a post-fact world – unforgivably, successive governments and opposition parties have been willing accomplices. But as the Toshiba meltdown shows, eventually reality catches up with you.”

If Toshiba’s liabilities exceed its assets at the end of the current fiscal year, it will be demoted to the second section of the Tokyo stock exchange, a move that could make it harder to secure money from banks and other lenders. The conglomerate, whose portfolio ranges from construction to consumer electronics, plans to generate funds by selling off its profitable flash memory business.

Toshiba, which employs 190,000 people, twice delayed planned earnings releases in 2015 as it reeled from a $1.3bn accounting scandal. Fallout from the scandal contributed to a group net loss last year of ‎479.4bn yen.