Shares in Japan's Toshiba conglomerate have tumbled on weekend reports saying the company would post huge losses this current fiscal year. Executives said restructuring measures would be painful.
Toshiba shares plunged 9.16 percent at the end of morning trading in Tokyo, having dived almost 10 percent at one point. The benchmark Nikkei-225 Stock Average dropped by 1.8 percent in early trading not least due to Toshiba's poor performance, but pared most of its initial losses later on.
The steep dive came on weekend reports that Toshiba would likely post a net loss of more than 550 billion yen ($4.5 billion, 4.1 billion euros) for the fiscal year because of restructuring costs in the wake of a large-scale corporate scandal. The company confirmed the projected losses on Monday, adding it would slash 6,800 jobs in the lifestyle business segment in Japan and oversees by the end of March
The 140-year-old Japanese company was earlier this year hit by revelations that executives systematically pressured employees to inflate profits in a years-long scheme to hide poor results and make money-losing businesses appear profitable.
Tough times ahead
It's been one of the most damaging accounting scandals to hit Japan in recent year and has seen the resignation of an incumbent president and seven othertop managers.
Two weeks ago, the Securities and Exchange Surveillance Commission watchdog said Toshiba should be slapped with a record $60-million fine over the scandal.
Originally founded to develop telegraphic equipment, Toshiba now sells everything from rice cookers to nuclear reactors and operates in fives domains - energy and infrastructure, community solutions, healthcare systems, electronic devices and lifestyle products and services.
The company has a workforce of 200,000 globally and operates in 76 countries.
hg/nz (Reuters, dpa)