Olympus faces hundred of millions in compensations for accounting fraud.

[orfeo]

It could be the last years for Olympus as we know it.
http://m.bbc.com/news/business-26950496

 

[OzRay]

Never underestimate Japanese resolve and how Japanese businesses think, it's anything but like western ideas and ideals. They will not allow something like this to bring them down and even if the law suit is successful, it isn't that big a sum in the totality of their business.

 

[GFFPhoto]

I'm pretty sure 273 million (28bn yen) isn't going to end Olympus as we know it. That is about 4% of their projected 2014 revenue of 718bn yen

http://investing.businessweek.com/research/stocks/earnings/earnings.asp?ticker=7733:JP

 

[orfeo]

Net income for Olympus was 80 millions dollars last year.http://investing.businessweek.com/research/stocks/financials/financials.asp?ticker=7733:JP

Even though they lost nearly 480 millions dollars in 2012 doesn't mean they are able to take this new hit...

 

[OzRay]

People predicted the end of Olympus when the financial scandal was revealed, yet they kept introducing new and better gear. Now people are predicting the end of Olympus even before a case has been heard. Are some that eager to see Olympus disappear?

 

[orfeo]

In fact it's predicting after the lawsuits has been announced. You can also expect a decrease in Olympus shareholder's happiness level.

 

[OzRay]

Olympus is currently sitting on 16+ lawsuits as a result of the scandal, but simply having a writ thrown at you doesn't mean that it will even get to court or if it does, that you will be found liable and for the amount sought. To do so is counting your chickens before the eggs have hatched. Olympus' shareholder happiness dived when the scandal was revealed, but that didn't stop Sony from investing in Olympus or shareholder happiness rising again.

 

[MajorMagee]

At best they'll get a share of the business ownership, rather than cash.

 

[rklepper]

Olympus will just pass this on to the consumer and the shareholder. They won't even hardly flinch. If you think they will you have little understanding of how big business operates.

 

[WT21]

Net income for Olympus was 80 millions dollars last year.http://investing.businessweek.com/research/stocks/financials/financials.asp?ticker=7733:JP

Even though they lost nearly 480 millions dollars in 2012 doesn't mean they are able to take this new hit...

The question about whether a company can survive something is always about cash flow, never about earnings. You would need to look at cash flow (and access to any additional funds, and potential settlements, not to mention years in litigation) to make a judgement.

 

[RickinAust]

Have they set aside any reserves for this? If they have then they may expect some sort of payment.

 

[drd1135]

I for one would gladly pay twice as much for my Olympus lenses to help the cause.



rofl

 

[dogs100]

I for one would gladly pay twice as much for my Olympus lenses to help the cause.
rofl

Does that include my second hand one?

 

[DoofClenas]

The sky is falling...aaaaaaaaaaaaaaaahhhhhhhh.

Does this mean that my camera is going to stop working?

 

[krugorg]

The sky is falling...aaaaaaaaaaaaaaaahhhhhhhh.

Does this mean that my camera is going to stop working?

Yes.

I would be happy to take some of those lenses off your hands, Clint. Of course, they need to be cheap enough that I can have cash reserves for any potential lawsuits.

 

[DoofClenas]

Yes.

I would be happy to take some of those lenses off your hands, Clint. Of course, they need to be cheap enough that I can have cash reserves for any potential lawsuits.

Tell you what, buy my em1 for $4200 and I'll toss in my lenses for free.

 

[GFFPhoto]

I for one would gladly pay twice as much for my Olympus lenses to help the cause.



rofl

I'm willing to forego lens hoods if that will help :smile:

 

[Hyubie]

Just thinking out loud - I think Japan would be very averse to folding up Olympus, as it is one of a handful of Japanese companies that can truly be called "global". Japan (and, pretty much East Asia) has a very deep sense of pride, and though they have a lot of rich and successful companies, very few have as much recognition globally. They may bash someone internally, but I suspect they'll be concerned too of their global image. Unlike in Western economies where very few are literally too big to fail, I think there is more at play here than market forces, finance, or accounting. Capitalism with an Asian twist, if you will.

So my thinking is Olympus will continue to exist.

 

[tomO2013]

It's a flash in the pan financially speaking.

Relatively recent financial reports show the following :
http://www.43rumors.com/olympus-forecast-says-they-will-return-to-profit/

In terms of investment, investors are quite willing to forgive the sins of the past if they can see a change in management (there has been) and potential for growth - sales figures are going up, not down.
Even if (and its a massive if!) Olympus were to declare bankruptcy as a result of this lawsuit etc... the core fundamental business is still sound. A manufacturer such as Sony or Canon would probably jump in, buy it up, debts and all, just to get their hands on their extensive patent portfolio, technology and brand. In terms of end users, it would continue to be business as usual.

You only need to worry about the longevity of the Olympus brand itself when people stop buying the cameras and the company stops innovating.