Toshiba’s troubles keep piling up.
The Japanese firm’s shares plunged 20% on Wednesday, after the company warned it is expecting billions of dollars in losses from its takeover of a U.S. nuclear construction business last year.
“We’re still figuring out the exact numbers, but it could reach up to several hundred billion yen,” CEO Satoshi Tsunakawa told reporters Tuesday.
Toshiba’s U.S. nuclear-power subsidiary Westinghouse acquired CB&I Stone & Webster late last year, when Toshiba was still struggling to recover from a $1.2 billion accounting scandal.
Toshiba’s shares dived in the months following that scandal, which led to a major management reshuffle after the Japanese conglomerate admitted it had doctored financial results for years. The company reported a loss of 460 billion yen ($3.9 billion) for 2015.
There were signs of a turnaround. Toshiba reported earnings of 115 billion yen ($977 million) through the first six months of the current financial year.
But this week’s news has rattled investors once more — Toshiba stock is down more than 30% since Monday, when reports of the massive loss first began circulating.
“I’m deeply sorry about all the concerns and possible damages this unprecedented situation may bring to all the stakeholders including our shareholders and investors,” Tsunakawa said.
At the time of last year’s acquisition, CB&I had been working with Westinghouse on nuclear reactor projects in the U.S. On Tuesday, Toshiba said Westinghouse has found that the cost to complete those projects will “far surpass estimates,” adding that the loss could drive the subsidiary’s net worth into negative territory.
Toshiba makes everything from consumer electronics to medical equipment, but now plans to re-evaluate its nuclear energy operations.
“We may revise the positioning of nuclear business in the future if it’s needed,” Tsunakawa said.
