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Toshiba profits boosted by Westinghouse

Friday, 27 April 2007

Japan's Toshiba Corporation has posted record profits for 2006, and credits its purchase of US nuclear supplier Westinghouse as a contributing factor. A net profit of 137.4 billion yen ($1.16 billion) for the financial year ending 31 March was 76% up on 2006 figures.

The company's Power Systems business saw sales rise on the consolidation of Westinghouse into the group. Toshiba expects sales to continue to increase as a result of the Westinghouse purchase during the financial year to March 2008, but the company - which earns around 50% of its income from digital products and electronic devices - is forecasting an overall 17.4% net fall in income.

Toshiba completed the acquisition of Westinghouse from BNFL for $5.54 billion in October 2006. The company currently has a 77% interest in Westinghouse, and its partners Shaw Group and Ishikawajima-Harima Heavy Industries (IHI) hold the remaining 20% and 3% respectively.

The purchase coupled Toshiba's experience with boiling water reactor (BWR) technology and its presence in the Japanese market with Westinghouse's pressurised water reactor (PWR) systems and world market position. By bringing Westinghouse into the group, Toshiba says it is seeking to maximise synergy by combining it with its existing nuclear power business, and hopes to "accelerate globalization" of its business operations, according to the company's earnings release. At the time of the purchase, Toshiba expected the move to enable it to expand its nuclear sales business to 700 billion yen ($5.86 billion) by 2015 and 900 billion yen ($7.54 billion) by 2020.

Further information

Toshiba
Westinghouse