Japan's TEPCO posts record loss as president resigns

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Japan's Tokyo Electric Power on Friday posted a record $15 billion loss and its under-fire president resigned to take responsibility for the worst nuclear crisis since Chernobyl 25 years ago.

The beleaguered utility posted an annual net loss of 1.247 trillion yen ($15 billion), the biggest ever for a non-financial Japanese firm. The company did not give an earnings forecast for the current financial year.

With compensation liabilities estimated at tens of billions of dollars, the utility warned the "significant deterioration" in its financial position "raises substantial doubt about its ability to continue as a going concern".

Its heavily criticised president Masataka Shimizu resigned over the crisis at its crippled Fukushima Daiichi nuclear plant, after earlier saying he would likely step down at an appropriate time.

"The public has lost confidence in nuclear power," Shimizu told a press conference. "It is the right way for the top manager to take the ultimate responsibility." Sakae Muto, head of TEPCO's nuclear division, also resigned.

Managing director Toshio Nishizawa will replace Shimizu effective after a June shareholders meeting. He said he accepted it was his "fate to lead our efforts in this difficult time," as he apologised for the emergency.

Ten weeks after Japan's March 11 earthquake and tsunami that has left nearly 25,000 people dead or missing, the crisis at the Fukushima Daiichi plant remains unresolved after cooling systems failed, leading reactors to melt down.

The disaster has prompted Japan to review plans to boost its use of atomic power as tens of thousands of people remain evacuated from homes, farms and businesses in a 20-kilometre (12-mile) zone around the radiation-spewing plant.

Earlier this week the company said its plan to end the crisis at Fukushima by January at the latest was on schedule, despite damage to the facility being worse than initially thought.

Recent TEPCO updates have confirmed experts' fears that fuel rods inside reactor one had been fully exposed to the air and had melted, and that reactors two and three were likely in a similar condition.

The loss for Japan's biggest utility comes amid heavy criticism over its handling of the emergency, in which it faces massive compensation claims that have prompted the government to devise a rescue plan using public and industry funds.

The government has also suggested lenders may have to waive loans made to TEPCO before the disaster.

In warning of the "significant deterioration" in its financial position TEPCO said it would adhere to the government's order to restructure in return for assistance.

Asia's biggest power company, TEPCO supplies electricity for the megacity of Tokyo and the wider Kanto region, an area that contributes more than a third of the nation's gross domestic product.

TEPCO said it would cut jobs and draft a streamlining plan this year as it looks to raise funds to pay for a compensation bill that some analysts have estimated to reach as high as 10 trillion yen.

It said it would sell assets not essential to power generation to raise more than 600 billion yen.

The company said it had decided to scrap four reactors at the plant after the March 11 earthquake, and abandoned plans to build two more.

TEPCO and the government have yet to release estimates for the payout bill, but analysts say it could range from four trillion yen ($50 billion) to 10 trillion yen, depending on how long the crisis lasts.

The record loss came despite an operating profit that rose 40.5 percent in the year to 399.6 billion yen.

The company said it will not pay a dividend for the full year. The last time the company skipped an annual dividend was when it was established in 1951.

Ratings agency Moody's on Monday again downgraded TEPCO and warned the rating would remain on review for further possible action.

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