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No guarantee of V-shaped recovery

TOKYO -- Toshiba needs a new, stable source of earnings and a strategy for growth to return to profitability quickly after its gut-wrenching restructuring. It must also see to restoring badly damaged financial health.

     The Japanese company's finances -- perhaps its greatest vulnerability -- already stack up poorly against those of domestic peers like Hitachi and Mitsubishi Electric. And they will get worse before they get better. With a huge net loss on the way, shareholders' equity is poised to drop 60% year on year to 430 billion yen ($3.55 billion) at the close of fiscal 2015 next March, sending the equity ratio into the single digits. By this measure, Toshiba will have sunk as low as Sharp, another money-losing electronics group in the midst of retrenchment.

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