Canon Reports Strong Demand for Color Printing

Canon has announced its financial results for the third quarter 2015 (3Q 2015), revealing a strong demand for color printers in developed countries and a declining demand for monochrome in China and Southeast Asia.

In the third quarter, net sales experienced a 6.1% year on year increase to JP¥925.8 billion (US$7.69 billion). Net sales for the nine months ended September 30, 2015 totaled JP¥2,757.6 billion (US$22.9 billion), a year-on-year (YOY) increase of 3.4%. Due to ongoing cost-cutting activities and highly profitable new products, the gross profit ratio for the third quarter increased 1.2 points YOY to 50.7%, while gross profit ratio for the first nine months increased to 51.2%, remaining at a high level. Also in the same period, operating expenses increased 9.0% YOY to JP¥392.0 billion (US$3.3 billion). Operating profit turned out to be JP¥77.3 billion (US$0.6 billion), up 7.6% compared to the same period in last year. Other income (deductions) fell to JP¥11.6 billion (US$0.1 billion), due to foreign currency exchange losses, leading to a YOY 7.7% decline in income before income taxes to JP¥74.0 billion (US$0.6 billion). Relatively, net income attributable to Canon Inc. was down 15.6% to JP¥49.2 billion (US$0.4 billion). Operating profit for the first nine months of the year decreased by 6.4% to JP¥248.2 billion (US$2.1 billion) while income before income tax decreased by 13.7% to JP¥238.5 billion (US$2.0 billion), and net income attributable to Canon Inc. for the first nine months decreased by 19.0% to JP¥151.3 billion (US$1.3 billion).

Office Business Unit sales increased 5.9% YOY to JP¥510.7 billion (US$4.2 billion), while operating profit totaled JP¥67.2 billion (US$0.6 billion), a year-on-year increase of 16.2%. Sales for the combined first nine months of the year totaled JP¥1,576.8 billion (US$13.1 billion), growing 4.2% YOY, while operating profit totaled JP¥218.3 billion (US$1.8 billion), dipping 0.1% YOY.

Imaging System Business Unit sales for inkjet printers showed a slight increase thanks to strong sales of consumables. Sales for the business unit decreased by 4.2% to JP¥302.5 billion (US$2.5 billion), while operating profit totaled JP¥41.7 billion (US$0.3 billion), a decline of 3.8%. Sales for the combined first nine months of the year totaled JP¥897.7 billion (US$7.5 billion), a year-on-year decrease of 4.6%, while operating profit totaled JP¥121.3 billion (US$1.0 billion), declining 11.0% year on year.

Industry and Others Business Unit sales increased 43.1% YOY to JP¥138.8 billion (US$1.2 billion) while operating profit increased by JP¥5.6 billion (US$46.5 million) to JP¥0.6 billion (US$5.0 million). Sales for the combined first nine months of the year totaled JP¥358.4 billion (US$3.0 billion), a year-on-year increase of 27.1%, while the operating loss totaled JP¥10.3 billion (US$85.5 million) owing to upfront investment into next-generation technologies.

Canon expects a strong recovery in the U.S. and a gradual recovery in Western European during the fourth quarter.

The sale of laser printers is expected to continue to grow in developed countries, while sales in China and Southeast Asia will likely face prolonged stagnation. Canon also projects full-year consolidated net sales in 2015 of JP¥3,820.0 billion (US$31.7 billion), a year-on-year increase of 2.5%; operating profit of JP¥365.0 billion (US$3.0 billion), a year-on-year increase of 0.4%; income before income taxes of JP¥355.0 billion (US$2.9 billion), a year-on-year decrease of 7.4%; and net income attributable to Canon Inc. of JP¥225.0 billion (US$1.9 billion), a year-on-year decrease of 11.7%.

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