Hogan on Olympus financials

Started Feb 16, 2013 | Discussions thread
Abrak
Senior MemberPosts: 1,328
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Re: Unless...
In reply to John Koch, Feb 17, 2013

John Koch wrote:

Abrak wrote:

It is hardly surprising then that they have seen a build up in inventory from excess production from product they were unable to sell. Nothing very misleading about that.

Nothing misleading, no, unless they continue to carry the inventory into the next period, without write-down, in order to avoid posting deeper losses for the quarter ending in March. Camera inventories have a notorious obsolescence rate. One defintion of "obsolescence" might be: inability to sell at a price that covers the marginal cost of output."

Yes, it will inevitably be pretty ugly.Olympus took a 3.7bn yen exceptional write down against the imaging division in 3Q but it wasnt against inventory. Almost by definition, inventory has built up most in products that have missed their sales targets by the greatest margin. I very much doubt Olympus is sitting on piles of excess stock of OMDs.

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