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Olympus will cut 2,700 jobs and restructure plants as the Japanese camera maker seeks to recover after writing down assets following a $1.7 billion accounting- fraud scandal.

The jobs, about 7 per cent of Olympus's global workforce, will be eliminated by March 2014, the company said in a statement in Tokyo today. Olympus will close a plant in the Philippines this year and sell unused property over the next two years, it said.

The world's biggest maker of endoscopes needs to shore up capital after writing down the value of assets because of a 13- year accounting fraud exposed by former President Michael Woodford. The company will increase its focus on the imaging, medical and life-sciences businesses as Olympus aims to boost its capital ratio to more than 30 per cent by March 2017, it said in today's statement.

"We will withdraw from businesses which we judge to offer insufficient profitability and potential," Olympus said in the statement. "We will not make new investment in areas other than the core business domains."

Olympus had 34,391 employees, including 3,234 in Japan, as of March 2011, according to its website.

Olympus said it may post net income of 7 billion yen ($88 million) this fiscal year, compared with the 25 billion yen average of four analyst estimates compiled by Bloomberg. Operating profit may be 50 billion yen, compared with the 63.4 billion yen average estimate of analysts.

The maker of Pen digital cameras had a loss for the first time in three years last fiscal year partly because of higher tax costs and a strong yen that eroded overseas earnings, Olympus said last month. The net loss was 49 billion yen for the year ended March 31.

Olympus is aiming for average annual revenue growth of 10 per cent and profit growth of 13 per cent at its medical business as it expands in emerging markets including China and India, it said.

The company plans to restructure its imaging business and increase the focus on mirrorless cameras and high-end compact models, it said in the statement. Olympus controls 75 per cent of the global market for endoscopes, instruments that doctors use to look inside the body's cavities to help detect disease.

Olympus got 41 per cent of sales from its medical division last fiscal year.The business, including endoscopes, was the most profitable at Olympus and covered losses in imaging and "other" businesses.

Bloomberg

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