The company has released its third quarter results, recording a small net sales increase although Canon adds it has experienced deteriorating market conditions.
Net sales increased by 2.9% to ¥1,025.2 billion ($6.8 billion/ €6.5 billion) and operating profit increased by 1.5% to ¥82.6 billion ($550 million/ €522 million). The more than one trillion yen in third-quarter net sales represents the largest in 16 years, second only to 2007.
Additionally, for the first nine months of the year, Canon maintained sales and profit growth, posting total net sales of ¥3,017.3 billion ($20.1 billion/ €19 billion), an increase of 5% and total operating profit of ¥259.4 billion ($1.73 billion/ €1.64 billion), an increase of 1.3%.
Canon says the Printing-Office segment saw solid sales. The company said: “As for office MFDs, the need for core printing equipment in offices that offer excellent image quality, printing speed, and durability, has not changed. And excluding China where the economy is slowing, demand has remained stable.”
For the Printing-Office segment, Canon recorded 5.2% increased net sales of ¥240.5 billion ($1.6 billion/ €1.5 billion), which takes this segment’s net sales for the first nine months to a total of ¥984.4 billion, a 10.8% increase year-on-year.
The Printing-Prosumer segment showed a different side, where net sales decreased 0.8% to ¥231.3 billion ($1.54 billion/ €1.46 billion), resulting in this segment’s net sales for the first nine months period decreasing 5.9% year-on-year to ¥961.4 billion ($6.4 billion/ €6.1 billion).
Canon explained: “Printer market conditions have been weaker than expected due to the economic downturn in China and the impact of monetary policies in Europe and the United States. As a result, some competitors are cutting prices to maintain sales.
“As for laser printers, we saw soft demand in China and are not seeing much improvement in market conditions elsewhere. Additionally, amid the rise in interest rates, users and dealers are continuing to squeeze inventory and as a result our sales in the third quarter were limited to the same level as in the second quarter.
“Assuming more time is needed for sales to recover, we lowered our projection for the full year. However, consumable sales are expected to increase in the fourth quarter. From next year on, in addition to expecting consumable sales to increase, we plan to improve our performance by revising our strategy regarding hardware as well.
“For inkjet printers as well, our unit sales in the third quarter were below plan. We also lowered our outlook for the full year due to expected market contraction. However, consumable sales continued to be at a level above last year.
“In the fourth quarter, the year-end selling season, we will increase sales of refillable ink tank models, for which we have significantly strengthened our lineup by adding seven models since the end of last year. At the same time, we will stimulate demand for cartridge models through sales promotions and link this to consumable sales from next year on.”
Tags: Canon, Financials, OEMs, Business
