Sales Down, Income Flat for Canon’s Third Quarter; Demand for Office Multifunctionals is Steady

canon inc.Canon Inc. of Tokyo reported results for its fiscal third quarter, with sales down 4.5 percent to ¥872.2 billion (U.S.$8,002 million) and net income down by 1.0 percent to ¥58.2 billion (U.S.$534 million), both compared to the same quarter a year ago.

Net sales for the nine months ended September 30, 2014 were ¥2,667.3 billion (U.S.$24,471 million), a year-over-year decline of 1.1 percent. Net income for Canon’s first nine months increased by 12.3 percent to ¥186.7 billion (U.S.$1,713 million).

Canon says that during the third quarter, demand for office MFPs and laser printers maintained steady growth. However, demand for interchangeable-lens digital cameras remained sluggish due to the delayed economic recovery in Europe and the still-depressed demand in Japan, while in China, demand showed robust signs of recovery. Demand continued to shrink for Canon’s digital compact cameras in both developed countries and emerging markets. In the inkjet-printer market, demand decreased slightly from the previous year. In Canon’s industry and Others sector, a rebound in capital investment for both image sensors and memory devices led to a pickup in demand for semiconductor lithography equipment, while demand for lithography equipment used in the production of flat panel displays (FPDs) for tablets and TV screens increased.

Canon notes that overall during the third quarter, although MPFs enjoyed “hearty demand” and industrial-equipment sales increased, the delayed recovery in demand for interchangeable-lens digital cameras, and the continued shrinking of the market for digital compact cameras led to total reduced net sales.

Within Canon’s Office Business Unit, although sales of color office MFPs increased significantly from the year-ago period, led by healthy growth of the imageRUNNER ADVANCE C5200 series, along with well-received new models, total sales volume remained at the same level as the previous year, due to sluggish demand for monochrome MFPss. As for high-speed continuous-feed printers, the Océ ColorStream 3000 series enjoyed solid sales. Among laser printers, although color laser MFPs recorded sales growth, total sales volume decreased slightly from the year-ago period, due to the decrease in demand for monochrome MFPs. Sales of consumables declined from the year-ago period, in which Canon had recorded strong sales. As a result, sales for Canon’s Office Business Unit totaled ¥482.3 billion (U.S.$4,424 million), a year-over-year decline of 2.4 percent, while operating profit totaled ¥57.9 billion (U.S.$531 million), decreasing 13.7 percent. Sales for Canon’s Office Business Unit in its first nine months of the year totaled ¥1,513.9 billion (U.S.$13,889 million), growing 2.4 percent year-over-year, while operating profit increased by 7.4 percent to ¥218.5 billion (U.S.$2,004 million).

Forecast

For its fourth quarter, Canon expects demand for its MFPs to continue to expand moderately, mainly for color models, while demand in the laser-printer market is expected to remain at the same level as the previous year. Looking at inkjet printers, demand is expected to contract from last year’s level, due to the delayed recovery of the global economy.

Canon is projecting full-year consolidated net sales in 2014 of ¥3,740.0 billion (U.S.$34,312 million), a year-over-year increase of 0.2 percent; operating profit of ¥370.0 billion (U.S.$3,394 million), a year-over-year increase of 9.7 percent; income before income taxes of ¥380.0 billion (U.S.$3,486 million), a year-over-year increase of 9.3 percent; and net income attributable to Canon Inc. of ¥250.0 billion (U.S.$2,294 million), a year-over-year increase of 8.5 percent.

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