UPDATE 1-Hoya to hold back on M&A, eyes health care
(Recasts lead, adds executive comments, background)
TOKYO, Nov 10 (Reuters) - Japanese high-tech glass maker Hoya Corp (7741.T) said on Monday it was in no hurry to push forward on acquisitions, even with potential targets looking cheap, as it tightens its belt for a prolonged slump.
Hoya, which acquired digital camera and endoscope maker Pentax last year, now plans to cut personnel throughout its operations.
The job cuts will be more concentrated in areas outside of growth areas such as vision care and health care, executives said, adding that no time frame or target cuts have been set.
"We are very interested in M&A in health care, maybe six to 18 months down the line," said CEO Hiroshi Suzuki told Reuters following the company's quarterly earnings briefing. "But at the same time, we see no need to rush into things or make a major acquisition that could put our balance sheet at risk."
"This slump will probably last a while. Why buy when things are getting cheaper?" he said, declining comment on whether or not the company is in talks with potential targets.
Hoya competes with Olympus Corp (7733.T) and Fujifilm Holdings Corp (4901.T) in endoscopes -- tools used to examine internal organs for less invasive surgery.
Hoya, which also makes glass used in the production of semiconductors and LCDs, posted an operating profit of 20.61 billion yen ($207.9 million) for the three months ended Sept. 30, down 23.2 percent from the same period the previous year as a stronger yen and rising raw material prices hurt earnings.
Its net profit came to 19.14 billion yen, down 9 percent from the previous year on a 27.1 percent rise in sales, boosted by its acquisition of Pentax.
Demand for microchip-making equipment has stalled amid excess chip inventory, hitting Hoya and other chip gear suppliers such as Tokyo Electron Ltd (8035.T).
Business conditions in the chip sector were "very bad," Suzuki told a group of analysts, adding that he could not foresee when it would hit bottom.
"Cash will differentiate the winners from the losers," he said.
Momentum in demand for digital camera lenses has also come to a halt in October, he said.
Hoya's rivals in chip-making equipment include Shin-Etsu Chemical Co Ltd (4063.T) and Dai Nippon Printing Co Ltd (7912.T).
Hoya, which plans to merge its hard drive media operations with Showa Denko (4004.T) in January next year, also offers hard drive substrates, pitting itself against Konica Minolta Holdings Inc (4902.T).
Shares of Hoya closed up 4.3 percent after its earnings results announcement, while Tokyo's electrical machinery subindex .IELEC.T rose 5 percent. (Reporting by Mayumi Negishi; editing by Sophie Hardach)
