Japanese steelmaker Nippon Steel has announced that it will post an impairment loss of assets as an extraordinary loss totaling JPY120 billion ($1.53 billion) in the second quarter ending September 30 of the financial year 2012-13.
Nippon Steel is planning to decrease the book value of its Hirohata Works and Sakai Works to the present value of future cash flow and post the amount of the decrease as an extraordinary loss. Both production facilities were continuously in deficit due to the super-strong Japanese yen and a slowdown in steel material market conditions.
Due to the write-off of its steelmaking facilities, Nippon Steel expects to see a net loss of JPY 155 billion ($1.97 billion) in the second quarter, compared to its earlier estimate of JPY 85 billion ($1.08 billion).