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 Anonymous 2013-06-21 at 10:21:40 am Views: 113
  • #1984
    Konica Minolta Q1 profit down, camera ops in red

    Japan's Konica Minolta Holdings Inc. said on Wednesday its quarterly operating profit fell 13 percent due to weak sales of photographic film and a loss in its camera division, but it kept its full-year outlook unchanged.

    The company Reported healthy sales of colour copiers, laser printers and optical pickup lenses, but said that was outweighed by steep price falls in the digital camera market, merger costs and the negative effect of a stronger yen.

    Konica Minolta, the world's third-largest maker of photographic film after Eastman Kodak and Fuji Photo Film, was created in August 2003 through the merger of precision equipment companies Konica Corp. and Minolta Co.

    It said group operating profit totalled 16.95 billion yen ($153.2 million) in the three months to June 30, compared with 19.58 billion yen in the same quarter last year based on a simple aggregate of Konica and Minolta's quarterly results.

    The two did not consolidate earnings until last October.

    "Expectations are high in the market for merger benefits but it also vital that Konica Minolta ensures that its camera operations and other business areas are strong," said Kiyoshi Yamanaka, fund manager at T&D Asset Management.

    "Copiers and printers seem to be doing well, but competition is very fierce in this field."

    Brisk sales of copiers and printers have also boosted the quarterly earnings of Canon Inc, Ricoh Co., and U.S.-based Xerox Corp, which said its profit more than doubled and raised its outlook for the full year.

    Konica Minolta said that sales in its mainstay copier and printer division fell 4.1 percent to 144.06 billion yen, hurt by a rise in the yen and price competition. Operating profit in the division increased 6.1 percent, however, to 14.9 billion yen.

    Besides its core office equipment business, Konica Minolta is also counting on optical pickup lenses used in DVDs, digital camera lens units and film used in liquid crystal displays (LCDs) to drive earnings growth over the medium term.

    The Tokyo-based company stuck by its forecast for consolidated net profit to rise 55 percent to 30 billion yen in the year to March 2005. It expects revenues to reach 1.15 trillion yen, up 2.4 percent year-on-year.


    Stripping out merger expenses and the yen's gain against the dollar and the euro, Konica Minolta said its operating profit in the latest quarter would have actually risen by 1.6 billion yen compared with the April-June period last year.

    But the company's photo imaging division, which includes photo film and digital cameras, posted an operating loss of 2 billion yen in the three months to June 30, following last year's loss of 6.6 billion yen.

    Konica Minolta said the average prices of its digital cameras fell about 20 percent year-on-year in the latest quarter, reflecting the tough industry conditions that have hit profitability at larger rivals including Olympus Corp..

    It is shifting its product lineup towards high-end models and plans to launch its first digital single lens reflex (SLR) camera later this year. Digital SLRs are typically priced at or above $1,000 and fetch high margins.

    "The average selling price of cameras should rise and so profitability should return," Kiyofumi Tanida, general manager of corporate accounting, said at a news conference.

    But sales of photographic film have also been weak, dropping 7 percent in the latest quarter in the domestic market in volume terms. Sales were down 6 percent overseas, supported somewhat by strong demand in Asia, the company said.

    Shares of Konica Minolta have fallen nearly 8 percent during the past three months, roughly in line with the benchmark Nikkei average's 6.4 percent decline.

    Before the earnings announcement, its shares ended Wednesday down 1.4 percent at 1,410 yen, while the Nikkei fell 1.17 percent. ($1=110.65 yen)


    * Post was edited: 2004-08-19 15:29:00