Olympus forecasts £261m loss
Olympus Corp, which is trying to recover from an accounting scandal that battered its balance sheet, forecast a 32bn yen (£261m) full-year net loss – dragged down by its ailing camera business.
The loss estimate for the financial year ending 31 March, compared with a 3.87bn yen net profit in the previous year, highlights the urgent need for the camera and medical-equipment maker to shore up its finances in the wake of the $1.7bn (£1bn)
Potential investment partners attracted by Olympus’s profitable endoscope business are believed to include Fujifilm Holdings, Sony Corp, Panasonic and South Korea’s Samsung Electronics.
But Olympus President Shuichi Takayama has said a decision on any alliances must wait until the installation of new management after its annual shareholders’ meeting in April.
For its October-December third quarter, Olympus, which holds a 70 per cent share of the global market for diagnostic endoscopes, reported a 756m yen net loss, compared with a 2.04 billion yen net profit in the same period a year earlier.
But in a sign that its core endoscope business may survive the scandal unscathed, operating profit in its medical systems business rose 7 percent year-on-year during the quarter, having recovered from disaster-related supply disruptions earlier in the year.
In December, Olympus filed five years’ worth of corrected earnings statements to iron out its accounts and said that as of the end of September net assets were 46 billion yen, down from a restated 225 billion yen in March 2007. It also withdrew its forecast for an 18bn yen net profit this business year.
The accounting scandal erupted when Olympus fired its British chief executive Michael Woodford on 14 October, after he raised concerns about dubious book-keeping.
Since then, Olympus has admitted it used improper accounting to conceal massive investment losses under a scheme that began in the 1990s. It remains under investigation by law enforcement agencies in Japan, Britain and the United States