Leica's economical performance

Olsen

Olsen

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I foud this on the Leica user forum:

Leica Camera AG / Half Year Results

28.11.2007

Release of an Ad hoc announcement according to § 15 WpHG, transmitted by DGAP - a company of EquityStory AG.
The issuer is solely responsible for the content of this announcement.
=--------------------------------------------------------------------------

In the first six months of the current fiscal year, i.e. until September
30, 2007, the Leica Camera AG Group (ISIN DE000A0EPU98) registered sales
growth of 71.2 %, to EUR 88.8 million. Sales in the Photo segment grew by
147.0 %, to EUR 62.6 million. The strong sales growth of digital compact
cameras and the success of the digital rangefinder camera M8 are clearly in
evidence here. Sales in the Sports optics segment have increased by 1.9 %,
to EUR 16.4 million.

Compared to the prior year period, Group net income/loss improved by EUR
11.0 million to a net income of EUR 6.5 million. This enhanced performance
is mainly due to the increase in sales.

For fiscal year 2007/2008 Leica Camera Group aims at achieving a positive
operating result and for the following fiscal years at further improving
its performance. The precondition therefor is that the reorientation of the
product portfolio and the implementation of the restructuring concept are
continued according to plan.
28.11.2007 Financial News transmitted by DGAP

My comments are:

I hope that the Kaufman family is satisfied with this result and that it motivates them to invest in future development. How good will the full fiscal year be? Realistically, the 2.half will not be so vigorous as the first half, but a turnover of 140 - 150 mill € are realistic. compare this with the last official figures that were published when Leica were a public company:

2004/05
Turnover: € 92,0
Operating profit: - € 18,5

2005/06
Turnover: € 106,7
Operating profit: - € 6,2

We hear that the fiscal year 2006/07 ended with a 'net loss' of - € 11 million (Please note that 'net loss/profit' is not comparable to 'operating profit') and that Leica aim at making 2007/08 with a positive net result ("For fiscal year 2007/2008 Leica Camera Group aims at achieving a positive
operating result and for the following fiscal years at further improving
its performance").

This sentence I am not sure if I really understand:

"Compared to the prior year period, Group net income/loss improved by EUR
11.0 million to a net income of EUR 6.5 million. This enhanced performance
is mainly due to the increase in sales..."

- Periodically; which YoY do they mean?

Growth of binoculars confirms a steady to slightly falling sales volume-vise, only just compensating for the cost of producing these expensive optics.

Still; the future of Leica looks 'dramatically bleak'. USA, their most important export market is lost in one of the most dramatic fall of the US dollar in history. No wonder that all the Americans here complain about all the price increases of Leica gear in USA. (- In my local currency Leica gear has been cheaper, due to the strengthening of the NOK towards the €). - There is no way that other and more virgin market can compensate for the trustworthy volume that their American customers have been contributing with up through the years. To cut cost with 35 - 40% is not easy either. Thus the price increases.

Here Leica faces the same problems as other large European exporters. Like Airbus. For the first time in 140 years Brits are cueing up in front of a bank to take their savings out. Savings they fear are lost in a credit crisis across the Atlantic. It's a small world.
 
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sky-is-falling.jpg
 
NB23 said:
Wow, yet another Olsen-the-world-is-coming-to-an-end post.
Click to expand...

-Where did I say that? In my world things are going very good. Very good indeed, - which I tried to weave in there. And the future looks bright.
 
sitemistic said:
Seems like from this report that Leica's approach of rebadging Panasonics was the right one for their lower price digitals. Without the R&D expenses, they are actually making a profit on these cameras. I initially thought that people would not pay the extra money for the Leica name on a Panasonic camera, but was completely wrong. Whoever is making the marketing decisions needs to get a nice bonus!

If they can figure out how to make a lower priced digital M without diluting their high end market, they should make a killing.
Click to expand...

It is indeed promising that they are making a profit in these difficult circumstances. But is it good enough - in the owner's perspective, for being the risky business of developing digital RF cameras? I wonder. Regardless of what they come up with it is not going to be cheap. In dollars.
 
sitemistic said:
If they can figure out how to make a lower priced digital M without diluting their high end market, they should make a killing.
Click to expand...

Nice idea. This could be a "CL Digital". Or a "Panasonic M".
 
leica never re-badged panasonic cameras. leica entered into an agreement to provide useage of the name and lens designs for some models. the common belief that the cameras are the same (ie digilux 2 and lc1) with different badges is in fact not entirely correct. leica has always had different spec's for image processing, compression blah blah blah.
i agree though that it was a smart move and a much needed influx of dough and knowledge to make the leap into the digital age. i will foolishly assume that leica "has a plan". there are very skilled craftsmen/craftswomen and buisiness men/women making what they presume to be informed decisions about leica's future.
as far as the dire future predictions for leica's future... i mean really, hasn't this topic been covered at nauseum?
 
Yep, the M8 has saved Leica. Phew. I wonder though if it might be the case that the M8 is a small market and that it has largely been filled by now (almost everyone who wanted one now has one) - meaning that M8 sales might slow significantly from now on.

I think the new Summarits will do well but perhaps at the cost of their more expensive lenses. A digital CL IMHO would definitely be the way to keep the sales momentum going. The Summarit lenses would be the new "C" series lenses for it too.
 
I have a Leica Digilux about ten years old made by Fuji and understand that the processor was upgraded for Leica.

It recently stopped working and the local Fuji shop refused to repair it because it was badged Leica. I was ready to send it to a Leica shop, but the very next day it worked fine.
 
I have a Leica Digilux about ten years old made by Fuji and understand that the processor was upgraded for Leica.

It recently stopped working and the local Fuji shop refused to repair it because it was badged Leica. I was ready to send it to a Leica shop, but the very next day it worked fine.
 
That article is a little bit interesting, I wonder what they mean by a digital oversize sensor for the R-series? something in between full frame 35mm and medium format? Apparently an all new series with new lenses, mount etc. And a sort of "small" digital M??
 
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