Canon Inc. Third Quarter 2012 Results

Transcription

1 Canon Inc. Third Quarter 212 Results October 25, 212 Toshizo Tanaka Executive Vice President & CFO This presentation contains forward-looking statements with respect to future results, performance and achievements that are subject to risk and uncertainties and reflect management s views and assumptions formed by available information. All statements other than statements of historical fact are statements that could be considered forward-looking statements. When used in this document, words such as anticipate, believe, estimate, expect, intend, may, plan, project or should and similar expressions, as they relate to Canon, are intended to identify forward-looking statements. Many factors could cause the actual results, performance or achievements of Canon to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in general economic and business conditions, changes in currency exchange rates and interest rates, introduction of competing products by other companies, lack of acceptance of new products or services by Canon s targeted customers, inability to meet efficiency and cost reduction objectives, changes in business strategy and various other factors, both referenced and not referenced in this presentation. A detailed description of these and other risk factors is included in Canon s annual report on Form 2-F, which is on file with the United States Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein. Canon does not intend or assume any obligation to update these forward-looking statements.

2 Agenda 3Q 212 Results P3 5 FY 212 Projections P6 9 Details by Business P1 15 Financial Situation P16 18 Supplementary Information P

3 3Q 212 in Summary External Environment Global economic - Further slowdown Europe - Weakness becoming worse Emerging markets - Moderating growth Exchange rates - Yen's appreciation against the Euro Results Sales and profit decline Worsening external environment Laser printer inventory adjustment Maintained/expanded market share through highly competitive products 3

4 Summary of Results 3Q 212 Actual 3Q 212 3Q 211 Actual Actual Pct. Change Net Sales % Gross Profit % (% Sales) 48.3% 49.4% Op. Profit % (% Sales) 8.9% 13.4% Net Income Attributable to Canon Inc % (% Sales) 6.3% 8.5% Foreign Exchange Rate Yen 1USD Yen 1EURO

5 Transition in Sales and Op. Profit 3Q 212 Actual v. 3Q 211 Actual Sales Op. Profit 3Q 211 Actual Foreign Exchange Impact (Net Sales, Cost of Sales, Expenses) Sales Volume Impact Office -4.8 Imaging System Industry and Others Total Others Total Change Q 212 Actual USD: 1EURO: Change in Exchange Rate to yen to yen 5

6 Assumptions 212 Current Projection Average Exchange Rate 4Q12 FY12 FY11 Yen-1USD 78. yen 79.8 yen yen Yen-1EURO 1. yen 11.3 yen yen Impact of Exchange Rate Movement (4Q Impact Given a One Yen Change) Net Sales Operating Profit USD 5.4 billion yen 2.5 billion yen EURO 2.6 billion yen 1.6 billion yen 6

7 Key Points FY212 External Environment Global economy - Instability and growing concern over further slowdown Exchange rates - Continued underlying trend of yen's appreciation Outlook Made allowances for risks due to unstable external environment Projecting sales and profit decline, but will *Strive to achieve 2% growth in sales on a local currency basis by expanding sales of highly competitive products *Work to limit the decline in profits through expense reduction, concentrate internal efforts, and measures to improve management efficiency 7

8 Summary of Projected Results FY 212 Current Projection FY 212 FY 211 Current Projection Actual Pct. Change Net Sales 3,532. 3, % Gross Profit 1, , % (% Sales) 47.9% 48.8% Op. Profit % (% Sales) 1.1% 1.6% Net Income Attributable to Canon Inc % (% Sales) 6.6% 7.% Foreign Exchange Rate Yen 1USD Yen 1EURO

9 Transition in Sales and Op. Profit FY 212 Current Projection v. FY 212 Previous Projection Sales Op. Profit Previous Projection (Jul. 25, 212) 3, Foreign Exchange Impact (Net Sales, Cost of Sales, Expenses) Sales Volume Impact Office Imaging System Industry and Others Total Others Total Change Current Projection (Oct. 25, 212) 3, USD: 1EURO: Change in Exchange Rate to 79.8 yen to 11.3 yen 9

10 Office 3Q 212 Actual Sales Growth Rate y/y ( ) Local Currency Base 8 3Q12 Growth Rate y/y (Unit Base) Copiers Printers Color -4% -17% Monochrome -3% -27% Total -3% -26% 3Q12 Color Ratio Copiers Printers Value Base* 54% 48% Unit Base 32% 14% *Includes Consumables Monochrome Copiers Color Copiers Printers Others Office -13.4%(-11.4%) 49 Printers -22.4%(-22.2%) -3.7%(+.1%) Op. Profit Op. Profit Op. Profit Ratio Growth Rate y/y 14.3% 13.8% 12.8% 12.1% 1.1% % 3Q11 4Q11 1Q12 2Q12 3Q12-4.7%(-1.8%) Copier Total -4.2%(-.8%) 3Q11 4Q11 1Q12 2Q12 3Q12 1

11 Office FY 212 Projection Sales Growth Rate y/y ( ) Local Currency Base 3, Monochrome Copiers Color Copiers Printers Others 2,5 Office -8.1%(-5.2%) FY12 Growth Rate y/y (Unit Base) FY12 Color Ratio Copiers Printers Copiers Printers Color +13% -8% Value Base* 54% 46% Monochrome +8% -16% Unit Base 34% 13% Total +1% -15% *Includes Consumables Op. Profit 2, 1,918 1,819 1,763 Op. Profit Op. Profit Ratio 1,5 1, Printers -15.6%(-14.3%) 13.5% 11.4% 11.3% Growth Rate y/y -22.9% %(+3.8%) 28 2 FY11 FY12 FY12 Previous Current Projection Projection -.2%(+2.8%) Copier Total +.%(+3.4%) FY11 FY12 FY12 Previous Current Projection Projection 11

12 6 4 Imaging System 3Q 212 Actual 347 Digital Cameras IJP Others 373 Sales Growth Rate y/y ( ) Local Currency Base Imaging System -7.3%(-4.9%) 322 IJP -3.9%(-1.2%) Growth Rate y/y (Unit Base) Interchangeable Lens Digital Cameras 21.6% 3Q12-7% Compact Digital Cameras -21% Total Digital Cameras -17% IJP +4% Op. Profit Op. Profit Op. Profit Ratio Interchangeable Lens Digital Camera Ratio * 3Q12 Value Base 79% Unit Base 33% * Proportion of Total Digital Cameras Growth Rate y/y -3.% 2 Digital Cameras -1.8%(-8.7%) % % 15.1% 16.3% Q11 4Q11 1Q12 2Q12 3Q12 3Q11 4Q11 1Q12 2Q12 3Q12 12

13 Imaging System FY 212 Projection Sales 2,5 Growth Rate y/y ( ) Local Currency Base Digital Cameras IJP Others Growth Rate y/y (Unit Base) Interchangeable Lens Digital Cameras FY12 +22% Compact Digital Cameras +1% Total Digital Cameras +7% IJP +1% Interchangeable Lens Digital Camera Ratio * FY12 Value Base 76% Unit Base 32% * Proportion of Total Digital Cameras 2, Imaging System +1.1%(+13.1%) Op. Profit 1,5 1,312 1,528 1,445 IJP -.9%(+1.8%) Op. Profit Op. Profit Ratio Growth Rate y/y +15.3% 1, 5 Digital Cameras +1.7%(+13.8%) 16.1% % 16.9% FY11 FY12 FY12 Previous Current Projection Projection FY11 FY12 FY12 Previous Current Projection Projection 13

14 14.% 12.% 1.% 8.% 6.% 4.% 2.%.% -2.% Industry and Others 3Q 212 Actual Net Sales Gross Sales (Includes sales among Group businesses) Sales Eliminations (Sales among Group businesses) Gross Sales Growth Rate y/y ( ) Local Currency Base Sales Eliminations Lithography Equipment Others Industry and Others Net Sales -28.4%(-28.1%) Gross 93 Lithography Equipment (Unit Sales) Q Gross Sales -24.9%(-24.7%) 7.3% 9 3Q12 IC 11 8 FPD 7 3 (Litho. Equip.) -35.2%(-35.%) 3.3% Op. Profit Op. Profit Ratio 3.6% 4 4 IC Stepper Unit Breakdown by Light Source 6.4% 6 3Q11 3Q12 ArF KrF 2 i-line 9 8 Op. Profit *Calculation of operating profit ratio includes intersegment sales Growth Rate y/y -44.6% 5.4% 5-3 3Q11 4Q11 1Q12 2Q12 3Q12-5 3Q11 4Q11 1Q12 2Q12 3Q12 14

15 25.% 2.% 15.% 1.% 5.%.% -5.% -1.% Growth Rate y/y ( ) Local Currency Base 6 Sales Eliminations Lithography Equipment Others 5 Net Sales Industry and Others FY 212 Projection Sales 348 Lithography Equipment (Unit Sales) FY11 4 Gross Sales FY12 FY12 Previous Current Projection Projection IC FPD Industry and Others Net Sales -1.1%(-.5%) %(-.7%) 5 IC Stepper Unit Breakdown by Light Source FY11 Op. Profit Op. Profit Ratio FY12 FY12 Previous Current Projection Projection ArF KrF i-line Op. Profit Gross Sales (Includes sales among Group businesses) Sales Eliminations (Sales among Group businesses) Gross Gross (Litho. Equip.) -21.5%(-21.4%) % % 2.5% 12 *Calculation of operating profit ratio includes intersegment sales Growth Rate y/y 1-58.% -1 FY11 FY12 FY12 Previous Current Projection Projection -1 FY11 FY12 FY12 Previous Current Projection Projection 15

16 Inventories 8 Amount Turnover (Days) QE1 4QE1 1QE11 2QE11 3QE11 4QE11 1QE12 2QE12 3QE

17 , Capital Expenditure 1, Free Cash Flow Increase in PP&E Operating C/F Net Income Attributable to Canon Inc. Free C/F 75 Depreciation 75 Investing C/F FY9 FY1 FY11 FY12 Previous Projection FY12 Current Projection FY9 FY1 FY11 FY12 Previous Projection FY12 Current Projection 17

18 Cash on Hand Cash on Hand (Year-end) 15 Cash-on hand (Bilions of yen) Cash-on-hand (In months of 2nd-half net sales) FYE8 FYE9 FYE1 FYE11 FYE12 Previous Projection Note 1: 45, 1, 5, and 1 billion yen was used to acquire own shares in 27,28, 21 and 211, respectively. In 212, the year-to-date total is 15 billion yen. FYE12 Current Projection 18

19 Supplementary Information 19

20 Transition in Sales and Operating Profit FY 212 Current Projection v. FY 211 Actual Sales Op. Profit FY 211 Actual 3, Foreign Exchange Impact (Net Sales, Cost of Sales, Expenses) Sales Volume Impact Office Imaging System Industry and Others Total Others Total Change FY 212 Current Projection 3, USD: 1EURO: Change in Exchange Rate to 79.8 yen to 11.3 yen Supplementary Information 2

21 Gross Profit Variance Analysis 3Q 212 Actual v. 3Q 211 Actual 3Q12 3Q11 Change 1 Gross Profit % Sales 48.3% 49.4% -1.1 pt Forex Impact on Sales Sales Volume Impact Price Change Forex Impact on Costs Cost Reduction Others Total Change in Gross Profit Supplementary Information 21

22 Operating Profit Variance Analysis 3Q 212 Actual v. 3Q 211 Actual 3Q12 3Q11 Change Op. Profit % Sales 8.9% 13.4% -4.5 pt Total Change in Gross Profit Change in SG & A (Excluding Forex Impact) Change in SG & A (Forex Impact) Total Change in Operating Profit Supplementary Information 22

23 Interest Bearing Debt 5 4 Debt Debt/Total Assets 5.% 4.% 3 3.% %.3%.3%.3% 4.1% FYE8 FYE9 FYE1 FYE11 3QE12 2.% 1.%.% Supplementary Information 23

24 Financial Ratios (Yen) 9 15% 11.1% 6 9.2% 9.6% 9.3% 1% 7.3% 4.9% 6.3% 6.3% 6.1% % % FY8 FY9 FY1 FY11 FY12 Current Projection EPS(Basic) (Attributable to Canon Inc.) ROE ROA % Supplementary Information 24