Canon Inc says total net sales for the first quarter increased by 10.4% year-on-year to ¥971 billion ($A10.7bn) due to an improved business environment, with operating profit up 10.9% to ¥84.5 billion ($A940 million). Printing Business Unit sales increased by 10.0% pcp, with strong sales of imagePRESS V900/V1000 printers.
Starleaton will showcase the new Canon Colorado M with white ink at Visual Impact
“Though some small- and medium-size printing companies have become more cautious in their investment decisions due to the rise in interest rates, supported by our product lineup that we constantly strengthen through customer feedback, we maintained unit sales growth and also increased service revenue in the first quarter to post our eighth consecutive quarter of year-on-year sales growth,” Canon Inc. said.
“As a part of strengthening our product lineup, we are releasing from the second quarter the Colorado M series of graphic arts-oriented large-format printers. This printer’s modular design enables the combination of various functions, such as print speed, duplex printing, and the addition of white ink, to address a wide range of customer needs, and together with the expansion of dealers that handle this product, we aim to further increase our market share in this field.
“With a focus on graphic arts-oriented products, which use a lot of consumables, we will continue to grow sales at a double digit rate this year, which will lead to stable growth and increased profitability.”
2023 First Quarter in Review:
Looking back at the first quarter of 2023, while there were concerns about an economic slowdown resulting from the tightening of monetary policies continued from last year in order to curb inflation, personal consumption remained solid thanks to economic recovery following the COVID-19 pandemic.
By region, in the United States, the economy continued to recover moderately as the labour market continued to remain steady despite the tightening of monetary policies. In Europe, while the impact of the economic slowdown was exacerbated due to rising interest rates, the economy recovered moderately due to such factors as exports remaining firm. In China, domestic demand recovered due to the lifting of the government’s Zero-COVID strategy. In other emerging countries, economic recovery continued, mainly in India and Southeast Asia. In Japan, the economy recovered moderately due to the normalization of economic activities following the COVID-19 pandemic.
As for the first quarter, net sales for the first quarter increased by 10.4% year-on-year to ¥971.1 billion due to an improved business environment as mentioned above, as well as the adjustment of product prices resulting from increased costs caused by inflation and the depreciation of the yen. Gross profit as a percentage of net sales increased by 1.9 points year-on-year to 46.8% due to an improved product mix, thanks to the competitive new products that were released in the previous year and the depreciation of the yen. Gross profit for the year increased by 15.1% year-on-year to ¥454.0 billion. Operating expenses increased by 16.1% year-on-year to ¥369.5 billion as a result of an increase in sales force and sales-related expenses accompanying a growth in sales alongside maintaining an efficiency-focused control of expenses. In addition, operating expenses denominated in foreign currencies increased due to the depreciation of the yen. As a result, operating profit increased by 10.9% year-on-year to ¥84.5 billion. Other income (deductions) increased by ¥11.5 billion year-on-year to ¥3.1 billion, due to gain on valuation of securities and a decrease of currency exchange losses from liabilities denominated in foreign currencies. As a result, income before income taxes increased by 29.3% year-on-year to ¥87.5 billion and net income attributable to Canon Inc. increased by 22.7% year-on-year to ¥56.4 billion.
Basic net income attributable to Canon Inc. shareholders per share was ¥55.56 for the first quarter, a year-on- year increase of ¥11.59.
Results by Segment
Looking at Canon’s first-quarter performance by business unit, in the Printing Business Unit, MFDs for offices continued to sell well, with the number of unit sales significantly exceeding the same period of the previous year, as the product supply shortage was abated and products including the iR-ADV DX C5800 series were well-received in the market. As for inkjet printers, the number of unit sales decreased compared with the same period of the previous year as the surge in demand from users working remotely subsided. As for laser printers, the number of unit sales decreased compared with the same period of the previous year as companies curbed investments.
Regarding equipment for the production printing market, the number of systems sales increased compared with the same period of the previous year, with strong sales of the imagePRESS V900/V1000 series of on-demand printers.
As a result, sales of the Printing Business Unit increased by 10.0% compared with the same period of previous year to ¥558.2 billion. Due to effects such as weak consumables sales, net income before tax for the first quarter decreased by 4.2% compared with the same period of the previous year to ¥53.1 billion.
Outlook
The outlook for the global economy from the second quarter onward remains uncertain due to geopolitical risks and continued inflation. However, the global economy is expected to maintain a recovery trend due to the normalization of markets thanks to the decline of the COVID-19 pandemic and signs of financial stabilization due to an immediate response by regulatory authorities to financial uncertainty which originated in the United States.
Upon taking into consideration of the steady market conditions, currency exchange rates and sales prospects of competitive new products, Canon revised the forecast upward to full-year consolidated net sales of ¥4,313.0 billion, a year-on-year increase of 7.0%; operating profit of ¥380.0 billion, a year-on-year increase of 7.5%; income before income taxes of ¥410.0 billion, a year-on-year increase of 16.3%; and net income attributable to Canon Inc. of ¥285.0 billion, a year-on-year increase of 16.8%.
More details here: https://global.canon/en/ir/conference/pdf/conf2023q1e.pdf
