Ricoh to Record ¥23.1 Billion ($202.4 Million) Extraordinary Loss

Earlier this week, Ricoh Company of Tokyo, Japan, released results for its last six months, including some positive increases for sales and operating profit, but today announced that it will record an extraordinary loss of ¥23.1 billion ($202.4 million).

The losses stem from a Japanese bank requesting compensation related to loans to Ricoh’s troubled Ricoh India subsidiary.

Ricoh explained that several banks in Japan have issued letter of credits to underwrite the debt of Ricoh India. These banks in Japan have the right to request compensation from Ricoh, if the request is made by local banks in India and the payment based on a letter of credit.

Yesterday, one of the local banks called on the letter of credit,  and the corresponding bank in Japan has requested compensation from Ricoh Company. Consequently, Ricoh recognized the possibility of increasing losses related to this loan guarantee, thus allocating ¥23.1 billion yen, which is the full amount of the letter of credit, to its extraordinary losses in its non-consolidated financial results.

As Ricoh intends to claim the total amount from Ricoh India, the record of the allocation of the amount will be changed from reserves for guaranteed losses to an allowance for doubtful accounts.

Ricoh says it won’t change its published consolidated financial outlook for its fiscal year ending on March 31, 2018, for Ricoh Company, and which was previously announced on October 27, 2017.

More Resources

Advertisements
%d bloggers like this: