Canon Inc. First Quarter 2015 Results

Transcription

1 Canon Inc. First Quarter 215 Results April 27, 215 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 1Q 215 Results P3 5 FY 215 Projections P6 9 Details by Business P1 15 Financial Situation P16 18 Supplementary Information P

3 1Q 215 in Summary External Environment Level of global economic recovery below expectations U.S. economy showed solid growth Economies of Europe and emerging countries were weak Our markets Steady growth of office and lithography equipment Continued camera market contraction Results Sales and profit decline Lower sales of cameras, increase in R&D expense 3

4 Summary of Results 1Q 215 Actual 1Q 215 1Q 214 Actual Actual Pct. Change Net Sales % Gross Profit % (% Sales) 51.1% 49.7% Op. Profit % (% Sales) 7.7% 9.5% Net Income Attributable to Canon Inc % (% Sales) 4.% 5.5% Foreign Exchange Rate Yen 1USD Yen 1EURO

5 Transition in Sales and Op. Profit 1Q 215 Actual v. 1Q 214 Actual Sales Op. Profit 1Q 214 Actual Foreign Exchange Impact (Net Sales, Cost of Sales, Expenses) Sales Volume Impact Office -3.2 Imaging System Industry and Others Total Others Total Change Q 215 Actual USD: 1EURO: Change in Exchange Rate to yen to yen 5

6 Assumptions 215 Current Projection Average Exchange Rate 2Q-4Q15 FY15 FY14 Yen-1USD 12. yen yen yen Yen-1EURO 13. yen yen yen Impact of Exchange Rate Movement (2Q-4Q Impact Given a One Yen Change) Net Sales Operating Profit USD 12. billion yen 4.4 billion yen EURO 4.9 billion yen 2.2 billion yen 6

7 Key Points FY215 External Environment Weaker than previously projected global economic recovery U.S. economy remains solid Delayed economic recovery in Europe, emerging countries and China Our markets Steady growth of office and industrial equipment Continued camera market contraction Outlook Sales and profit growth 7

8 Summary of Projected Results FY 215 Current Projection FY 215 FY 214 Current Projection Actual Pct. Change Net Sales 3,86. 3, % Gross Profit 1,923. 1, % (% Sales) 49.8% 49.9% Op. Profit % (% Sales) 9.8% 9.8% Net Income Attributable to Canon Inc % (% Sales) 6.6% 6.8% Foreign Exchange Rate Yen 1USD Yen 1EURO Note: The influence of consolidating Axis AB is not included. 8

9 Transition in Sales and Op. Profit FY 215 Current Projection v. FY 215 Previous Projection Sales Op. Profit Previous Projection (Jan. 28, 215) 3, Foreign Exchange Impact (Net Sales, Cost of Sales, Expenses) Sales Volume Impact Office Imaging System Industry and Others Total Others Total Change -4.. Current Projection (Apr. 27, 215) 3, USD: 1EURO: Change in Exchange Rate 12. to yen 135. to yen 9

10 Office 1Q 215 Actual Sales Growth rate y/y ( ) Local currency base 8 1Q15 Growth Rate y/y (Unit Base) Copiers Printers Color +11% -1% Monochrome -12% +3% Total -3% +3% 1Q15 Color Ratio Copiers Printers Value Base* 56% 52% Unit Base 44% 16% *Includes Consumables 6 Monochrome copiers Color copiers Printers Others Office +3.9%(-2.8%) Others -.1%(-2.5%) Op. Profit Op. Profit Ratio Op. Profit Growth rate y/y -1.% % 2 Printers +4.5%(-6.8%) +7.5%(+4.2%) 14.2% % % 13.6% %(-.3%) 1Q14 2Q14 3Q14 4Q14 1Q15 Copier total +6.%(+2.2%) 1Q14 2Q14 3Q14 4Q14 1Q15 1

11 Office FY 215 Projection Growth rate y/y ( ) Local currency base 3, 2,5 2, Monochrome copiers Printers 2,79 Sales Color copiers Others Office +4.9%(+.2%) 2,177 2,181 Others +4.3%(+3.2%) FY15 Growth Rate y/y (Unit Base) Copiers Printers Color +17% +5% Monochrome +3% +2% Total +9% +2% Op. Profit Op. Profit Ratio FY15 Color Ratio Op. Profit Copiers Printers Value Base* 56% 5% Unit Base 43% 16% *Includes Consumables Growth rate y/y +13.% 1,5 Printers +2.5%(-6.2%) 14.% 14.1% 15.1% 1, %(+8.1%) FY14 FY15 FY15 Previous Current Projection Projection +6.1%(+2.9%) Copier total +8.1%(+5.8%) FY14 FY15 FY15 Previous Current Projection Projection 11

12 Imaging System 1Q 215 Actual Sales Growth rate y/y ( ) Local currency base 6 Growth Rate y/y (Unit Base) Interchangeable Lens Digital Cameras Compact Digital Cameras 1Q15-22% -27% Total Digital Cameras -25% IJP -3% Interchangeable Lens Digital Camera Ratio * 1Q15 Value Base 82% Unit Base 43% * Proportion of Total Digital Cameras * Value Base Includes Interchangeable Lenses Cameras IJP Others Op. Profit Imaging System -1.3%(-15.6%) Op. Profit Op. Profit Ratio Growth rate y/y -3.7% 2 IJP -4.5%(-8.8%) 14.4% 15.3% 13.7% 14.5% 11.1% Cameras -14.5%(-2.3%) Q14 2Q14 3Q14 4Q14 1Q15 1Q14 2Q14 3Q14 4Q14 1Q15 12

13 Imaging System FY 215 Projection Sales 2,5 Growth rate y/y ( ) Local currency base Cameras IJP Others Growth Rate y/y (Unit Base) Interchangeable Lens Digital Cameras Compact Digital Cameras FY15-9% -22% Total Digital Cameras -17% IJP +2% Interchangeable Lens Digital Camera Ratio * FY15 Value Base 83% Unit Base 45% * Proportion of Total Digital Cameras * Value Base Includes Interchangeable Lenses 2, 1,5 1,343 1,399 Imaging System -2.5%(-6.8%) 1,31 Op. Profit Op. Profit Op. Profit Ratio 1, IJP +4.8%(+2.%) Growth rate y/y -3.8% 5 Cameras -6.%(-11.2%) 14.5% % % 187 FY14 FY15 Previous FY15 Current Projection Projection FY14 FY15 FY15 Previous Current Projection Projection 13

14 3.% 25.% 2.% 15.% 1.% 5.%.% -5.% -1.% -15.% Industry and Others Lithography Equipment (Unit Sales) 1Q 215 Actual Net Sales Gross Sales (Includes sales among Group businesses) Sales Eliminations (Sales among Group businesses) Growth rate y/y ( ) Local currency base Sales Eliminations Lithography Equipment Others Gross Sales Q14 2Q14 3Q14 4Q14 1Q Industry and Others Net Sales %(-3.2%) -.5%(-1.8%) 5 1 Gross Sales Gross 89 (Litho. Equip.) +9.7% (+7.3%) Q14 1Q15 IC FPD % Op. Profit Op. Profit Ratio % Op. Profit *Calculation of operating profit ratio includes intersegment sales -5 IC Lithography Unit Breakdown by Light Source 1Q14 1Q15 ArF KrF 3 2 i-line % -5.8% % 1Q14 2Q14 3Q14 4Q14 1Q15 14

15 15.% 1.% 5.%.% -5.% -1.% -15.% Industry and Others Lithography Equipment (Unit Sales) FY 215 Projection Growth rate y/y ( ) Local currency base 6 Sales Eliminations Lithography Equipment Others 5 Net Sales Gross Sales (Includes sales among Group businesses) Sales Eliminations (Sales among Group businesses) Sales Gross Industry and Others Net Sales Gross 461 FY % (+19.4%) Gross Sales +15.6% (+14.5%) (Litho. Equip.) FY15 FY15 Previous Current Projection Projection IC FPD % (+2.3%) % Op. Profit Op. Profit Ratio Op. Profit *Calculation of operating profit ratio includes intersegment sales IC Lithography Unit Breakdown by Light Source % FY14 FY15 FY15 Previous Current Projection Projection ArF KrF i-line % -1 FY14 FY15 FY15 Previous Current Projection Projection -4 FY14 FY15 FY15 Previous Current Projection Projection 15

16 Inventories 8 Amount Turnover (Days) QE13 2QE13 3QE13 4QE13 1QE14 2QE14 3QE14 4QE14 1QE

17 1, 75 Capital Expenditure Increase in PP&E Net Income Attributable to Canon Inc. Depreciation 1, 75 Free Cash Flow Operating C/F Free C/F Investing C/F FY12 FY13 FY14 FY15 FY15 Previous Current Projection Projection -25 FY12 FY13 FY14 FY15 FY15 Previous Current Projection Projection* * Assumes 1% acquisition of Axis shares 17

18 Cash on Hand Cash on Hand (Year-end) 15 Cash-on-hand Cash-on-hand (In months of 2nd-half net sales, except FYE15, which is based on full-year net sales) FYE11 FYE12 FYE13 FYE14 FYE15 Previous Note : Approx. 1, 15, 5 and 15 billion yen was used to acquire Projection own shares in 211, 212, 213 and 214, respectively. The cumulative amount since 27 is approx. 1.5 trillion yen. FYE15 Current Projection* * Assumes 1% acquisition of Axis shares 18

19 Supplementary Information 19

20 Transition in Sales and Operating Profit FY 215 Current Projection v. FY 214 Actual Sales Op. Profit FY 214 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 215 Current Projection 3, USD: 1EURO: Change in Exchange Rate to yen to yen Supplementary Information 2

21 Gross Profit Variance Analysis 1Q 215 Actual v. 1Q 214 Actual 1Q15 1Q14 Change 1 Gross Profit % Sales 51.1% 49.7% +1.4pt Forex Impact on Sales Sales Volume Impact Price Change Forex Impact on Costs Cost Reduction Total Change in Gross Profit Supplementary Information 21

22 Operating Profit Variance Analysis 1Q 215 Actual v. 1Q 214 Actual 1Q15 1Q14 Change Op. Profit % Sales 7.7% 9.5% -1.8pt 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.% 2 2.% % %.1%.%.% FYE11 FYE12 FYE13 FYE14 1QE15 1.%.% Supplementary Information 23

24 Financial Ratios (Yen) 9 15% 9.6% 6 8.7% 8.4% 8.7% 8.5% 1% 6.3% 5.7% 5.6% 5.9% 5.7% % FY11 FY12 FY13 FY14 FY15 Current Projection EPS(Basic) (Attributable to Canon Inc.) ROE ROA % Supplementary Information 24