Camera-maker shifts focus to manufacturing printers

TOKYO - Shares of Konica Minolta had their biggest gain since the 2003 merger, after the company said it would stop making cameras after more than a century in the business to focus on printers.

The stock gained 8 per cent to 1380 ($17.5) on the Tokyo Stock Exchange.

Konica Minolta also plans to sell part of its single-lens reflex camera business to Sony Corp to focus on its profitable office equipment business. Sony shares gained 2.9 per cent to 5040.

Konica Minolta also named Yoshikatsu Ota, who heads the company's most profitable business equipment division, to take over as president. The company has struggled in the camera business as rivals such as Canon cut prices to gain share in the US$13 billion ($19 billion) digital camera market.
"Old Japanese companies tend to stick to business that they started, so it's a positive move because they finally gave it up to improve profit," said Koji Nakatsuka at RCM Japan.

Tokyo-based Konica Minolta forecasts a 47 billion ($597 million) loss in the year ending March 31, from a 7.52 billion profit a year ago.

Konica, which started making cameras in 1903 was established in 1873. Minolta was founded in 1928.

Konica Minolta said it would cut about 3700 jobs, or 11 per cent of its workforce, by September 2007. About 3200 jobs will be eliminated at the photo-imaging division, and about 500 jobs will be shed through early retirement, the company said.

Konica Minolta will continue to make lenses for single-lens reflex models made at its venture with Sony.

Nikon and Canon control about 80 per cent of the world's market for digital SLRs.

Global shipments of digital cameras are expected to reach 65 million this year, says industry researcher Camera & Imaging Products Association.

Konica Minolta expects to ship 2.03 million digital cameras, accounting for about 3 per cent of the market.

- BLOOMBERG