Re: Would you invest in [Leica]?

[Andre Jean Quintal <megamax@abacom.com>]

At 23:50 -0600 12/08/99, 4season wrote:
>The consensus that I've gotten on the matter of whether or not to invest
>in Leica is a resounding "No!", at least not now. A reason cited a
>number of times had to do with a perception that the company's future
>growth potential seemed limited.
. . .
	--> Leica remains one of Germany's "Crown Jewels"
	but, in general context, is not, for a while yet,
	the ideal investment for a private person
	with a limited investment portfolio. It's a very good
	investment for institutional investors and strategic
	investors who can sustain dangerous market conditions
	or who want to get at a brand name, for a portfolio's
	prestige, or to a company's patents, scientific capabilities,
	or gain an entry on a corporation's executive board
	with some ulterior motive.

	It's VERY IMPORTANT no one gets to think the above
	would mean a "thumbs down" on Leica Camera A.G.
	This is a very good company in a difficult market
	but, it seems to me, that is also quite well positioned
	to remain a viable corporate concern and under dependable and
	competent management, with a high quality international
	commercial network.

	The World is not exactly a very safe place for private
	investors with limited readily accessible private capital,
	right now. It's not just Leica but a lot of excellent firms
	that feel the markets crunch and pinch of the international
	monetary crisis.

	If we take a step back and analyse Leica as a provider
	of consumer / prosumer goods and its overall strategic position,
	in general context, things are not all that bad.

	If Leica was wholly owned by several private investors with
	little financial expertise and experience, I'd be worried
	but such is not the case, and the few who did not have
	the appropriate "financial surface" most probably
	called it quits last April. Just note how Leica is still
	around, how its stocks have regained a more comfortable
	stance, and never lose sight of its technology base
	and loyal following, then its prestige: not all that bad.

	For profits, I personally think Leica will improve its
	entry level offerings and those of its subsidiaries
	such as Minox, somewhat overdue for a newer strategic
	vision but definitely not a lost battle.
	I also expect both Leica and Minox to improve their
	"cash crop" capabilities this year.

	Think industrial capability, think "crown jewel",
	and things start looking brighter. If not for the
	ordinary Joe, certainly for the institutional investors
	and strategic investors in there for the long run
	and, oftentimes in Europe, with a "social responsibility"
	agenda. One dimension we have to remain aware of
	is the industrial and commercial synergies Leica
	benefits from and contributes to, especially in
	overall German and EEC context.

	I look at Samsung's point & shoots, give a sidelook
	at the GR1, the Hexar, Nikon's Pronea APS
	and see a very bright opportunity for both Leica
	and Minox's new offerings, given a far more aggressive stance
	towards these markets. There is a very good business
	opportunity for dealers, worldwide, in representing
	and doing a good job with both Leica and Minox brands products:
	these people are giving daily feedback, verbally,
	and through their actual sales ...

	While the M-line and R-line Leica cameras and optics
	are not necessarily a dealer's basic bread and butter,
	I'd be VERY suprised a Leica dealer would not care
	to keep Leica on his shelves and offerings anymore
	or in the near future and put in the required effort
	towards his staff's product knowledge and sales abilities.

	The Gods of Leica remain silent about digital related
	markets but the brand's potential there is enormous,
	most especially in Europe and in computer related
	peripherals and graphics boards. Leica's brand name
	alone is worth more than the company's stocks to a strategic
	investor and the LUG certainly would agree with this,
	I'm totally sure of. Right now, Leica may not be
	a profit hoarder's dream, but has it ever been ?
	Does this mean Leica is a poor investment ?
	I think it's a good investment but for the right people,
	with the right expertise, with something to contribute
	to the firm, ... plus a secure financial foundation.

	In photo related events, I personally expect Leica
	and Minox to revamp their basic and entry level
	offerings within a year and perform quite well
	and gain a lot of happy customers who, in turn,
	will bring in other potential customers to the dealers.
	I expect a "second degree" marketing program
	geared so as to make Leica and Minox entry level products
	more appealing to the worldwide dealership sales staff,
	as that's where the axe falls, and turn this into
	one more stabilising factor for the firm.
	Business is war: you loose or you win. Be "road warrior" aware .

	As consumers / prosumers, Leica makes a lot of sense
	and I'm not afraid of the future for current Leica
	owners. I just expect the Minilux and Z2X, (and the
	Minox range), to evolve rather fast and, quite possibly
	make a killing at cash registers within a year or less.

	Leica binoculars and related products enjoy unquestioned
	popularity and are truly "gift to myself" items
	people prize 20, 30 years. I hope you agree here too.
	These wonderful products also have built-in military markets
	appeal and that's a major factor presently.

	Let's put on our telepathic and "remote viewing" caps on
	for a moment: hey !  hey ! HEY ! What's that ?
	Apo-Summivar Z3X, Apo-Telyt-HR 75mm, Digilux DELTA,
	Apo-Telyt-DR 400mm, Apo-Vario-Elmarit-R 35-105mm 'pro',
	Apo-Vario-Telyt-R 28-90mm, Macro-Summicron-HR 60mm,
	Leica R8.2, workstation accelerated 2D/3D digital
	graphics boards, a whole new Minox (cameras, binoculars),
	Leica Digital projectors with Leica lenses, Noctilux-HR,
	and emerging technological / industrial / commercial
	alliances to further enhance Leica's overall favorable
	picture. LEICA: demonstrably superior products
	from a well managed corporation.

	We simply must not forget: Leica people are making it happen.
	Consumers who have never been part of any marketing, commercial
	operation or systems, from the inside, fail to register
	a L-O-T of work goes in, has to, to make a-n-y enterprise
	an enduring success. People get to meet these Leica folks
	after the bolts & nuts, the sensitive deals, the midnight oil,
	the personnel and management training, over a coffee or new lens
	at a Leica Clinic or during marketing events like Fotofest:
	all good and nice, but few realize these people very much
	earn their salaries making it all happen.
	To me, that's the ultimate positive factor: the human touch,
	the "human factor", the enlightened personal commitment
	both from competent Leica folks, their dealers and staff.

	Here, within the confines of the LUG, we're just kids
	having a sunny day in the virtual sand box and enjoying
	a very real Leica privilege and passion.

	All the best !

	Andre Jean Quintal