Sat, Jun 09, 2012 - Page 10 News List

Olympus to cut 7 percent of workforce

AFP, TOKYO

Scandal-hit Japanese camera and medical equipment maker Olympus yesterday said it would cut about 7 percent of its workforce — and eke out a small profit this year — as it tries to recover from a loss cover-up scandal.

The firm’s balance sheet deteriorated, with a loss of ¥48.99 billion (US$618 million) in the fiscal year through March, after its British former chief executive blew the whistle last year about US$1.7 billion worth of losses the company had moved off its balance sheet.

Olympus also said it would earn a ¥7 billion net profit in the current business year, while the 2,700 job cuts would be ushered in by 2014.

“Around 2,700 employees, or about 7 percent of the number of global employees as of March 2012, will be lost by March 2014,” it said in a statement.

The firm has almost 40,000 employees worldwide.

Olympus also said it would consolidate its global manufacturing base by 40 percent, while aiming to book a net profit of ¥40 billion for the fiscal year from March 2014 and ¥85 billion in the business year from March 2016.

The revelations by former Olympus head Michael Woodford triggered international criminal investigations and lawsuits from investors. The firm initially denied allegations it had used past acquisitions and outsized consultant fees to hide huge losses dating back to the 1990s, but eventually admitted wrongdoing.

In March, the company and three former top executives were charged over their role in the scandal.

Olympus announced yesterday that Woodford will receive £10 million (US$15.4 million) in a settlement over his dismissal.

Last week, both sides said they reached a settlement. The company disclosed the figure following approval from its board.

“In today’s settlement between myself and the company we reached a fair and amicable agreement, and I would like to take this opportunity to wish the new board well in taking Olympus forward,” he said in a statement from London.

Additional reporting by AP

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