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Ricoh Continues Recovery, Reports Improved A4 and A3 Product Supply and Sales

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Ricoh Corporation of Tokyo, Japan, today released financial results for its fiscal first quarter, which consisted of the three months that ended on June 30 2023.

In a nutshell, it was another quarter of recovery for Ricoh, due to strong sales and profit for its Digital Services business, which sells office MFPs and printers, and office services, with operating profit up 32.5 percent year-over-year.

In general, Ricoh noted that shortages of products and parts due to disruptions in global supply chains have improved. However, it says the global economy has gradually slowed down due to prolonged global inflation and the rise in interest rates.

Ricoh’s first-quarter net sales were ¥534.60 billion ($3.73 billion), up 16.4 percent year-over-year; operating profit was ¥10.17 billion ($71.07 million), up 5.7 percent year-over-year; and profit was ¥8.57 billion ($59.89 million), up 12.6 percent year-over-year.

Ricoh said sales increased mainly in the office-service business due to better product supply, and contributions from its PFU business, which was previously Fujitsu’s document-scanner business. Sales also benefited from depreciation of the yen.

Sales in the Americas increased by 15.1 percent year-over-year. Sales of edge devices in the office-printing business increased due to recovery of supply shortages, particularly for A4 MFPs. 

Ricoh also again stressed that it’s seeking to transition to a digital-services company. During this fiscal year, it says it will accelerate its transformation from an earnings structure focused on its office-printing business to one focused on ts digital-services business.

Digital Services

(Ricoh’s Digital Services business sells MFPs, laser printers, digital duplicators, wide-format printers, fax machine, document scanners, PCs, servers, network equipment, related parts and supplies, services, support, software, and service and solutions related to documents.)

Sales for the Digital Services business were ¥427.3 billion ($2.98 billion), up 15.9 percent year-over-year. In the office-services business, sales of the Scrum series in Japan continued to grow due to the expansion of back-office DX sales, and progress was made in acquiring projects in the manufacturing and other industries through Scrum Asset.

In the office-printing business, sales of edge devices increased year-over-year due to the progress in delivery of bulk sales, including A3 MFPs, mainly due to recovery of supply for A4 MFPs. As a result of increased office-services sales and continued implementation of pricing controls, in addition to a recovery for in-office printing, Digital Services operating profit was ¥8.9 billion ($62.16 million), up 32.5 percent year-over-year.

Digital Products Business

(Ricoh’s Digital Products business provides production and OEMing of MFPs, laser printers, digital duplicators, wide-format printers, fax machines, network equipment, and related parts and supplies, as well as production and sale of document scanners, and related parts and supplies and electronic components.)

Sales for the Digital Products business were ¥21.3 billion ($148.78 million), up 198.3 percent year-over-year. Revenue increased due to the recovery in production of A4 MFPs and the acquisition of PFU. However, despite increased sales and efforts to improve profits with structural reforms for production and development, Digital Products operating profit was ¥0.9 billion ($6.28 billion), down 75.6 percent year-over-year, mainly due to a decline in sales caused by production adjustments for relatively high-value-added A3 MFPs.   

Graphic Communications Business

(Ricoh’s Graphic Communications Business provides development and sale of production and commercial printers and inkjet print heads.)

Sales for the Graphic Communications sales were ¥56.6 billion ($395.36 million), up 9.1 percent year-over-year.

Sales of production printers continued to grow in Europe and the Americas. Non-hardware sales were also robust, exceeding the level before the pandemic.

For Ricoh’s industrial-printing segment, sales increased as sales of inkjet print heads increased due to increased demand. Despite a temporary increase in expenses due to structural reforms, Graphic Communications operating profit was ¥2.7 billion ($18.86 million), up 6.9 percent year-over-year. 

For Ricoh’s two other businesses, Industrial and Others, both sales and operating profit were down year-over-year for the Industrial business, while sales were up for its Others business, but operating profit was a loss.

Forecast

Ricoh is maintaining its forecast, which calls for a profit decline, as it is forecasting worsening global economic conditions.

It’s forecasting net sales of ¥2.25 trillion ($15.71 billion), up 5.4 percent year-over-year; operating profit of ¥70 billion ($489.07 million), down 11.1 percent year-over-year; and profit of ¥50 billion ($349.26 million), down 8 percent year-over-year. 

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