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Nikon Net Profits Drop, Operating Profits Soar

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November 14, 2005 - Nikon’s falling net profit figures are belying the company’s success. Although Nikon posted a sharp drop in quarterly net profit and states that its full year net profit will fall 38 percent, these falls reflect markdowns in inventory and transactions made last year to settle a patient dispute with rival stepper maker ASML and German manufacturer Carl Zeiss. Nikon has actually posted a first half net profit increase of 20 percent, up to 9.37 billion yen ($79.35 million US) from 7.81 billion yen.

Quarterly operating profit soared almost 150 percent from 5.0 billion yen ($42.4 million US) last year to 14.4 billion yen, with sales rising 6.6 percent for the quarter and 9.8 percent for the half. Nikon expects to sell 8 million digital camera units by March, with group net profit for 2005/2005 reaching 15 billion yen.

"High-end SLRs are selling better than we expected," explained Ichiro Terato, Nikon Chief Financial Officer, at a news conference. "As for compact cameras, which are susceptible to price erosion, ours suffered smaller price falls than the overall market."

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