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Ailing Olympus hunts for new camera markets

Bloomberg

Olympus Corp. said it’s looking for new camera markets such as sensors used in cars after forecasting a loss in the business for this fiscal year — its fifth straight annual deficit.

The scandal-tainted camera maker, also the world’s biggest endoscope supplier, will spend about ¥3.5 billion on its quest to find and develop business-to-business markets for its cameras, Chief Executive Officer Hiroyuki Sasa said in a recent interview in Tokyo.

The camera unit will return to profit in the 12 months ending March 2016, according to Sasa, a year later than he had previously forecast.

Olympus is looking beyond the consumer market for its cameras at a time when firms like Panasonic Corp. have benefited from pivoting toward products for cars and homes.

Sales of automobile cockpit electronics and connected services may reach $80 billion by 2020, according to Visteon Corp., spurred by infotainment systems, Apple Inc.’s CarPlay and U.S. regulations mandating back-up cameras.

“If we don’t prepare from now, we could get a bigger hit and report wider loss than now,” Sasa said referring to the camera unit. “We have such a sense of crisis.”

Operating income will be ¥88 billion for this fiscal year, based on its forecast for all divisions, including its mainstay products doctors use to view patients’ body cavities.

The camera unit aims for a ¥5 billion operating profit in the year starting April 2015, after the ¥3.5 billion loss it expects this fiscal year, Sasa said. Excluding the investment on seeking new markets, the camera unit would break even this year after reporting an operating loss of ¥9.2 billion in the year ended March, Sasa said.

Olympus wants to sell 630,000 units of mirrorless models this year, 24 percent over last year. Sales of compact cameras are expected to plunge to 1 million units this year from 2.71 million a year ago, it said.

Sasa in December had forecast that the camera unit will return to profit in the year that started April.

Shares of Olympus, which doubled in 2013, have fallen 2.4 percent this year, while the Topix has declined 8 percent.

Net income will more than triple to ¥45 billion for the year ending March because of growth in its medical unit and reduced losses in its camera unit, Olympus said May 9. Sales will rise 6.5 percent to ¥760 billion for the period, it said.

Olympus was sued by six banks for ¥27.9 billion in damages — the largest among civil lawsuits filed against it, over a 13-year accounting fraud, it said April 9.