Camera maker Olympus has been in a lot of financial trouble of late. However, in a bit of news coming directly from the company itself, there has been an unexpected turnaround thanks to a single product: the OM-D E-M1 which, according to Olympus, cut the company's imaging division's losses by 60%.
So, how good o news is this?
Going into 2013, Olympus projected its imaging division to lose about $42 million at the start of the year. By the end of fiscal year 2014, the losses were “only” about $17 million. According to Olympus, much of the credit for boosting the company's revenue goes to the OM-D E-M1, which took over as the company's flagship interchangeable lens camera this year.
Additionally, the company reports that its sale of lenses was up 30% for 2013, which bucks a trend of falling sales for interchangeable lens cameras (as well as lenses) for the industry as a whole.
As for fiscal year 2014: Olympus has a big goal: break back into the black. For the company, a turnaround of this magnitude would be a much-needed boost to self-esteem as Olympus nearly went belly-up a few years ago.
For Olympus, never a top-tier player in the camera market, the trouble started in October, 2011 when Michael Woodford, one of only a few foreign chief executives in charge of a Japanese company (he's British), was ousted by the Olympus board of directors over what was, at the time, deemed due to his management style.
Immediately after his firing, Woodford went on the attack, accusing top Olympus officials of mismanagement, covering up losses, and getting rid of him for his decision to open an investigation into the company's financial state. In the following weeks, Woodford's accusations were shown to be true and Olympus stocks lost about half their value in two months' time. In a symbolic move, Olympus was nearly de-listed by the Tokyo Stock exchange.
Following the scandal, Olympus cleaned house, firing executives implicated in the scandal and developing a new business model of going “back to basics” for the next 5 years. Additionally, many of the corrupt executives found themselves on trial for their dirty business dealings.
Hopefully, Olympus will continue its recovery and return to profitability in 2014.
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