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Toshiba to cut 6,800 jobs, focus on storage and energy

Mike Gee | Jan. 4, 2016
The plan follows the revelation of a financial scandal in July.

Visual Products Business:

・Withdrawal from operations outside Japan: The TV business has already shifted to a brand-licensing model in North America and Europe. Business in Asia (excluding China) will also shift to this model, and ownership of the company’s TV manufacturing plant in Indonesia is planned to be transferred to a third party company. Business in the Middle East and Africa will also shift to brand-licensing model through the sale of part of the shareholdings in two joint venture companies in Egypt that respectively manufacture and sell TVs. These companies will become non-consolidated companies of Toshiba.
・Reform of business structures in Japan: In Japan, the TV business will reduce fixed costs and strengthen profitability by enhancing development efficiency and reducing the number of indirect employees. It will also downsize TV sales to the scale of 600 thousand units a year, and concentrating on profitable high-end models.

Home Appliances Business:

・Reform of business structure: The Home Appliance Business will cut fixed costs by reducing the number of indirect employees globally, optimising operating sites in Japan, and improving operational efficiency.
・Withdrawal from the sales and production of twin-tub washing machineS: Manufacturing of twin-tub washing machines will end at the production facility located within the same site as TV manufacturing plant in Indonesia, which will be also transferred to a third party. As a result, Toshiba will end sales of twin-tub washing machines in Japan and other countries.

Sale of Ome Complex:

・In order to improve asset-use efficiency in the Lifestyle business segment, the Company plans to  
close and sell Ome Complex in Japan.

Strengthen Internal Controls and Reform the Corporate Culture

(1) Development of Improvement Action Plan:

Towards ending its designation of its shares as securities on alert, Toshiba is currently
implementing measures based on the Recurrence Prevention Plan announced on September 7. In
this connection, the Company is strengthening supervision of top management and internal
controls, holding awareness improvement seminars and meetings for executive managers and in
workplaces. Progress to date in major items is detailed in (2) below. Additional measures that are
under consideration will be announced promptly after they have been finalized.

(2) New Actions Taken to Prevent Recurrence and Reform the Corporate Culture:

The following actions are being taken under the new management team appointed in October, as
part of the measures to prevent recurrence of inappropriate accounting.

Recurrence Prevention:
・Accounting and awareness improvement seminars
・Training in accounting compliance
・Review on accounting procedures in relation to percentage-of-completion, valuation of
inventory and recording of operating expenses
・Review of the budget development process
・Review of corporate governance rules
・Reinforcement of the internal audit structure

 

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