The Financial Times reported on Tuesday that Olympus expects a net loss of ¥32 billion ($413 million) this year due mainly to asset write-downs* on the camera division. The medical division appears to be healthy and Olympus president Shuichi Takayama stated he expects that segment "to post a 22% rise in operating profit for the fourth quarter to the end of March."
Olympus was hit by a huge scandal last year when ousted president Michael Woodford blew the whistle on irregularities in the company's books that eventually showed they had hidden losses of over ¥100 billion ($1.29 billion) starting in the early 90's. After the dust settled, several high-level executives were fired, as many as 19 had lawsuits brought against them, and the price of Olympus shares had plummeted.
With the recent release of the E-M5, the fortunes of Olympus's camera division might be turning. When preorders for the camera opened, it soared to occupy 4 of the top 5 positions on Amazon.com's best sellers list (two colours were available, with and without the kit lens, making a total of 4 different buying options). Let's hope the new bosses (many of which are the same as the old bosses) decide to steer this ship better than they have until now.
*A write-down is a reduction in value of an owned asset, it is usually reflected in the company's income statement as an expense. Reasons for the devaluation of an asset can be ageing equipment, obsolescent technology, a rising local currency, etc.
Sources: FT.com., Economist.com.
