Fujitsu Commits to Europe, but Says UK Pullback May Yet Hit Finances

Reuters

17:42 JST, February 28, 2024

TOKYO (Reuters) – Fujitsu 6702.T will not abandon or significantly shrink its European businesses, chief financial officer (CFO) Takeshi Isobe said at the Japanese IT company’s third quarter earnings briefing on Wednesday.

But Fujitsu must work to recover credibility after a scandal in which hundreds of Post Office workers in Britain were wrongly convicted of theft, fraud and false accounting because of glitches in software developed by the company, Isobe said.

The IT group has said it will refrain from bidding for new UK government projects in the aftermath of the scandal, but would continue to work on existing projects.

Isobe said Fujitsu did not expect an immediate financial impact in its fourth quarter and was currently investigating the potential impact on the next financial year, which begins in April, adding it would announce any financial hit as soon as it was identified.

Fujitsu has no plans to cut UK headcount at present but Isobe left open the possibility in the future.

Separately, Isobe said Fujitsu would close its European PC devices business in April 2024 citing severe competition and difficulty in making a profit, but said the firm had no such plans for its other European businesses.

The company has come under pressure from the UK government to contribute hundred of millions of pounds to the compensation it expects to pay the victims of the Post Office scandal.

Fujitsu’s European head Paul Patterson earlier this month told a UK parliamentary panel the company had a “moral obligation” to compensate hundreds of wrongly convicted Post Office branch managers.

Isobe said the company was waiting for the outcome of Britain’s statutory inquiry before making a decision on compensation, adding that its UK subsidiary was “cooperating fully” with the investigation.