Olympus Imaging’s cumulative operating losses significantly bigger than originally reported

• 4 years ago
• Categories: Olympus
• Tags: financial results, Japan Industrial Partners and Olympus, Olympus bad financial results, Olympus to close camera division, Olympus to exit camera market rumor

We already knew that Olympus Imaging's cumulative operating losses during the last twelve years totaled ¥103bn. That's $1.2bn. Last week Olympus published their consolidated financial results for the second quarter of FY2021 (July - September 2020). Included in this reporting is the forecast of the FY2021 loss from the soon to be divested Imaging Business, now considered as 'discontinued operation': ¥53bn. That's an additional $500m.

As they politely said when presenting their results, "We expect to record a loss for the current fiscal year due to expenses related to the divestiture of the Imaging business." Later on they added: "Total loss of ¥5.5 billion is expected due to the loss associated with the divestiture of the Imaging Business."

There are other interesting bits concerning the Imaging Business in Olympus's financial reporting:

• Olympus has begun to severely downsize their Imaging business:
  • Imaging's headcount fell by nearly 30% between 31 March 2020 (4,270) and 30 September 2020 (3,031). In Japan, Imaging now has less than 400 employees.
  • Between April - September 2019 and April - September 2020, Imaging's capital expenditures fell by half (-51.6%) and R&D expenditures by 30%.
• Consequently, Olympus expects the revenue of the Imaging business to decline significantly over October - December 2020 compared to July - September whereas October - December is usually the strongest quarter of the year. Last year for instance October - December revenue was 121% of July - September revenue. This year the forecast ratio is 78%.

Thanks Mistral75!