Toshiba Corp. said its plan to achieve 1 trillion yen ($12.6 billion) in sales in fiscal 2015 in its mainstay nuclear power business is no longer possible due to the aftereffects of the accident at the Fukushima No. 1 nuclear power plant.
The announcement came as Toshiba, a major supplier of boiling water reactors to nuclear power plants, released its new three-year plan on May 17. The company annually renews its three-year plan, which starts in April.
The company lowered its sales projection for fiscal 2013 to 7.1 trillion yen, down by 1.4 trillion yen, or 16.5 percent, from a year earlier, due to lower-than-expected orders after the nuclear accident at the Fukushima No. 1 plant.
“A sales decline for the time being is inevitable,” said Norio Sasaki, Toshiba president.
Toshiba, whose core business is nuclear plant-related along with semiconductors, has been narrowing the scope of its investments. It acquired Westinghouse Electric Co., a U.S. nuclear power-related company, for 640 billion yen in 2006.
In 2009, the Japanese giant, combined with Westinghouse, won orders for 39 reactors worldwide for the period through the end of March 2016, and announced its plan for 1 trillion yen in annual sales. But with all of Japan's reactors currently offline, Toshiba sees little hope for new domestic orders and negotiations for orders overseas have been delayed.
Furthering the company's woes, the type of boiling water reactors that Toshiba manufactures are the same type that were used in the crippled Fukushima No. 1 nuclear plant. With an increasing number of foreign power companies rejecting this style of reactor, Toshiba's prospects for increasing revenue look bleak.
Meanwhile, Toshiba also said it ended production at its only domestic television manufacturing plant in Fukaya, Saitama Prefecture, last year. The TV business posted an operating loss in fiscal 2011.
As part of cost-cutting efforts, Toshiba will turn the Fukaya plant into a base for development and after-sales service in July. The company said the test-production facility at Fukaya was also shut down by the end of March, but it will continue to use the plant to manufacture liquid crystal display panels.
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