Presentations & Events


- ended March, 2009

Revised Business Forecast for FY2008

- April 17, 2009

Outline of the presentation

1. FY2008 Forecast, Overall

(billion yen)

FY2008 FY2007 As of Jan. Difference
vs. FY2007 vs. As of Jan.
Net Sales 6,650.0 7,665.3 6,700.0 -1,015.3 -50.0
Operating Income (loss)
Income (loss) before ncome taxes and minority interest
Net income (loss)

* Mobile Broadcasting business was discontinued at the end of FY2008, and FY2007 figures were adjusted accordingly.

2. Breakdown of Revised Business Forecast

Operating income (loss) -250.0 billion yen (+30.0 billion yen)
Digital Products +5.0 billion yen
Improvement in TV business, resulting in a return to the black

Electronic Devices +15.0 billion yen
Improvement on increased sales in Memory and System LSI businesses
Income (loss) before income taxes
and minority interest
-280.0 billion yen (+50.0 billion yen)
Improvement from rise in operating income
Net Income (loss)  -350.0 billion yen  (-70.0 billion yen)
Impacted by 85 billion yen revision of deferred tax assets (for local tax)

(vs. Jan. 2009)

3. Action Program Measures to Improve Profitability

  1. Reform structures of Businesses Most Affected by the Downturn
    • Semiconductor business restructuring
    • LCD business restructuring
    • Other challenging businesses (digital products, home appliances) under review for possible restructuring
  2. Execute Toshiba Group-wide Actions to Strengthen Business Structure
    • Comprehensive reduction of fixed costs
         ¥300 billion reduction vs. FY2008
    • Measures to generate profit: strengthen cost competitiveness and expand businesses outside Japan
  3. Accelerate Strategic Allocation of Resources to Growth Businesses
    • Shift managerial resources to Social Infrastructure businesses
    • Accelerate new businesses in such fields as the environment and energy

Q & A Session

Q1. Please break down the revised business forecast.
Operating loss was revised to ¥250 billion, a ¥30 billion improvement over the January 29 business forecast. The Digital Products segment was revised upward by ¥5 billion, primarily due to improved profitability in the TV business. In addition, the Electronic Devices segment was revised upward by ¥15 billion, primarily due to improvements in the memory and system LSI businesses.
Loss before income taxes and minority interest was revised upward by ¥50 billion to ¥280 billion due to improvements in operating loss.
Net loss worsened by ¥70 billion to ¥350 billion mainly due to a withdrawal of a portion of deferred tax assets (for local tax).
Q2. Why are deferred tax assets being withdrawn?
Through the combined efforts of the entire company, we now expect the operating loss would be improved than the forecast announced on January 29th. However, recognizing that the future financial situation remains unpredictable, and considering the risk of any delay in the economy's recovery, we decided in the end to withdraw the entire amount of Toshiba's non-consolidated deferred tax assets for local taxes, including an additional ¥85 billion withdrawal.
Q3. It was reported that your FY2009 structural reform budget has been increased from a preliminary estimate of ¥35 billion to ¥60 billion. Is this true?
The estimate at the time of the last announcement was for approximately ¥50 billion for the period from FY2008 to FY2009. (Approx. ¥15 billion in FY2008 and ¥35 billion in FY2009) However, we are now revising the amount to approximately ¥75 billion for the same period. (Approx. ¥15 billion in FY2008 and ¥60 billion in FY2009)
Q4. Is it likely that you will secure profit in FY2009?
We are thinking of ways to turn a profit. However, the FY2009 forecast is still being drawn up, and we have no comment at this time.
Q5. What are the reasons for the worsening of the D/E ratio, for both debt (interest-bearing debt) and equity (shareholders' equity)?
Debt (interest-bearing debt) is rising slightly. Equity (shareholders' equity) decreased due to worsened operating loss during the fourth quarter and the negative effects from the deteriorated accumulated other comprehensive loss resulted form reassessment of pension liability adjustment. As a result, the D/E ratio has worsened significantly. We will work to improve the D/E ratio by improving both the operating income (loss) and cash flows.

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