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*May 26, 2005 - *
Olympus announced it was cutting 30 percent of its camera division workforce, Pentax told investors that 300 jobs will be slashed over the next two years to compensate for losses in its digital imaging division.
Pentax announced on Wednesday that the employee cuts as well as other reduction measures will save the camera manufacturer $1.6 million by the spring of 2007 to the Tokyo Stock Exchange.
As a result, Pentax also cut sales and operating profits for the remainder of the fiscal year. For the sales year ending next March, Pentax initially forecast sales of $1.6 billion. With the announcement of cuts, Pentax has since said it expects to drop to $1.2 billion in sales.
On the Pentax website the corporation explained their problems, 'After reviewing its fiscal year 2004 sales performance, Pentax Corporation decided that, due to drastic and unforeseeable changes in our management environment, we could not achieve its initial financial objectives, even if all measures and options available were applied. Therefore, we have decided to make these revisions.'
The Pentax release continued, 'Our basic management policy for the execution of this management plan, however, remains unchanged, with the slogan of ‘Growth and Expansion’. In our business activities, we will continue to pursue the reinforcement and expansion of our life care and optical component businesses. At the same time, we will take all measures needed to make our imaging systems business profitable as quickly as possible.'
Pentax is expecting an operating profit of $45 million for the current fiscal year. This number is substantially lower than an earlier forecast of $111 million.
Overall, Pentax hopes to reduce costs by $56 million by 2007.