Canon Inc. First Quarter 2017 Results

Transcription

1 Canon Inc. First Quarter 217 Results April 26, 217 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 217 Results P3 5 FY 217 Projections P6 9 Details by Business P1 15 Financial Situation P16 18 Supplementary Information P

3 1Q 217 in Summary External Environment Global economy Developed countries - improvement driven by the U.S. Emerging markets - gradual recovery thanks to economic stability Results Significant growth in sales and profits Existing businesses - laser printers and cameras return to positive growth New businesses - strong performance of network cameras, OLED panel manufacturing equipment 3

4 Summary of Results 1Q 217 Actual 1Q 217 1Q 216 Actual Actual Pct. Change Net Sales % Gross Profit % (% Sales) 48.1% 5.8% Op. Profit % (% Sales) 7.8% 5.% Net Income Attributable to Canon Inc % (% Sales) 5.7% 3.5% Foreign Exchange Rate Yen 1USD Yen 1EURO

5 Transition in Sales and Op. Profit 1Q 217 Actual v. 1Q 216 Actual Sales Op. Profit 1Q 216 Actual Foreign Exchange Impact (Net Sales, Cost of Sales, Expenses) Sales Volume Impact Office Imaging System Industry and Others Total Others Total Change Q 217 Actual USD: 1EURO: Change in Exchange Rate to yen to yen 5

6 Exchange Rate Assumptions 217 Current Projection Average Exchange Rate 2Q-4Q17 FY17 FY16 Yen-1USD 11. yen yen yen Yen-1EURO 12. yen yen yen Impact of Exchange Rate Movement (2Q-4Q Impact Given a One Yen Change) Net Sales Operating Profit USD 1. billion yen 3.5 billion yen EURO 5. billion yen 2.3 billion yen 6

7 Overview of Latest Projections External Environment Global economy - stronger recovery than last year Developed countries - continues to be driven by the U.S. Appreciation of the yen due to delayed hike in U.S. interest rates Full-year Projection Double digit growth in sales and Existing businesses - steady recovery New busineses - significant sales growth to continue 7

8 Summary of Projected Results FY 217 Current Projection FY 217 FY 216 Pct. Change Current Projection Actual Net Sales 4,2. 3, % Gross Profit 1,911. 1, % (% Sales) 47.5% 49.2% Op. Profit % (% Sales) 6.7% 6.7% Net Income Attributable to Canon Inc % (% Sales) 4.5% 4.4% Foreign Exchange Rate Yen 1USD Yen 1EURO

9 Transition in Sales and Op. Profit FY 217 Current Projection v. FY 217 Previous Projection Sales Op. Profit Previous Projection (Jan. 31, 217) 4, Foreign Exchange Impact (Net Sales, Cost of Sales, Expenses) Sales Volume Impact Office +1.4 Imaging System -8.8 Industry and Others +6. Total Others Total Change Current Projection (Apr. 26, 217) 4, USD: 1EURO: Change in Exchange Rate 11. to yen 12. to yen 9

10 Office 1Q 217 Actual 1Q17 Growth Rate y/y (Unit Base) Copiers Printers Color +12% +8% Monochrome -3% +14% Total +4% +13% 1Q17 Color Ratio Copiers Printers Value Base* 59% 5% Unit Base 55% 16% *Includes Consumables Sales Growth rate y/y ( ) Local currency base 6 Monochrome copiers Color copiers 4 Printers Others Office +.7%(+1.9%) Others -3.9%(-2.%) Op. Profit Op. Profit Op. Profit Ratio Growth rate y/y +24.% 2 Printers +6.8%(+6.3%) 9.8% 1.4% 1.% 12.1% +1.5%(+3.7%) % %(-4.6%) 1Q16 2Q16 3Q16 4Q16 1Q17 Copier total -2.%(+.1%) 1Q16 2Q16 3Q16 4Q16 1Q17 1

11 2, 1,5 Office FY 217 Projection Monochrome copiers Printers Sales Growth rate y/y ( ) Local currency base 2,5 1,88 1,829 Color copiers Others 1,836 Office +1.5%(+.6%) Others +1.1%(+.2%) FY17 Growth Rate y/y (Unit Base) Copiers Printers Color +8% % Monochrome -3% -1% Total +3% -1% Op. Profit Op. Profit Ratio FY17 Color Ratio Op. Profit Copiers Growth rate y/y +4.4% Printers Value Base* 59% 52% Unit Base 54% 17% *Includes Consumables 1, Printers +.9%(-.1%) 9.4% 9.7% 9.6% %(+4.6%) %(-2.4%) FY16 FY17 FY17 Previous Current Projection Projection Copier total +2.4%(+1.6%) FY16 FY17 FY17 Previous Current Projection Projection 11

12 Imaging System 1Q 217 Actual Sales Growth rate y/y ( ) Local currency base 4 Cameras IJP Others Imaging System +3.1%(+5.8%) Growth Rate y/y (Unit Base) Interchangeable Lens Digital Cameras Compact Digital Cameras 1Q17 +6% -6% Total Digital Cameras % IJP -1% Op. Profit Op. Profit Ratio Op. Profit Interchangeable Lens Digital Camera Ratio * 1Q17 Value Base 83% Unit Base 52% * Proportion of Total Digital Cameras * Value Base Includes Interchangeable Lenses Growth rate y/y +49.% 2 1 IJP -1.9%(+.5%) Cameras +7.4%(+1.3%) 8.4% 2 15.% % % % 29 1Q16 2Q16 3Q16 4Q16 1Q17 1Q16 2Q16 3Q16 4Q16 1Q17 12

13 Imaging System FY 217 Projection Growth rate y/y ( ) Local currency base 1,6 1,2 8 Cameras IJP Others 1,95 Sales 1,92 1,89 Imaging System +.2%(-.6%) IJP +1.2%(+.3%) Growth Rate y/y (Unit Base) Interchangeable Lens Digital Cameras Compact Digital Cameras Op. Profit Op. Profit Ratio FY17-7% -13% Total Digital Cameras -9% IJP % Op. Profit Interchangeable Lens Digital Camera Ratio * Growth rate y/y +8.7% FY17 Value Base 86% Unit Base 6% * Proportion of Total Digital Cameras * Value Base Includes Interchangeable Lenses 13.2% 14.1% 14.3% 4 Cameras -.7%(-1.5%) FY16 FY17 Previous FY17 Current Projection Projection FY16 FY17 FY17 Previous Current Projection Projection 13

14 17.5% 1.% 2.5% -5.% Industry and Others Lithography Equipment (Unit Sales) 1Q 217 Actual Sales Growth rate y/y ( ) Local currency base 1Q16 1Q17 IC FPD 8 2 IC Lithography Unit Breakdown by Light Source 1Q16 1Q17 ArF KrF 6 2 i-line Sales Eliminations Lithography Equipment Others 274 Industry and Others Net Sales % (+152.%) Op. Profit 2 Net Sales Gross Sales (Includes sales among Group businesses) Sales Eliminations (Sales among Group businesses) Gross Q16 2Q16 3Q16 4Q16 1Q17 Gross Sales % (+126.8%) Gross 294 (Litho.Equip.) +23.4% (+23.2%) % Op. Profit Op. Profit Ratio *Calculation of operating profit ratio includes intersegment sales 1.4% % 1.8% % 1Q16 2Q16 3Q16 4Q16 1Q17 14

15 1.% 9.% 8.% 7.% 6.% 5.% 4.% 3.% 2.% 1.%.% Industry and Others Lithography Equipment (Unit Sales) FY 217 Projection Growth rate y/y ( ) Local currency base 1,6 Sales Eliminations Lithography Equipment Others Net Sales 1, Sales 1,88 1, Industry and Others Net Sales Gross 1,169 FY % (+116.4%) Gross Sales +1.% (+99.4%) FY17 FY17 Previous Current Projection Projection IC FPD Op. Profit Op. Profit Ratio Op. Profit *Calculation of operating profit ratio includes intersegment sales IC Lithography Unit Breakdown by Light Source FY16 FY17 FY17 Previous Current Projection Projection ArF KrF i-line Growth rate y/y +67.6% Gross Sales (Includes sales among Group businesses) Sales Eliminations (Sales among Group businesses) Gross FY16 FY17 FY17 Previous Current Projection Projection (Litho. Equip.) +6.4% (+59.7%) % % 1.3% 21 7 FY16 FY17 FY17 Previous Current Projection Projection 15

16 Inventories 8 Amount Turnover (Days) QE15 2QE15 3QE15 4QE15 1QE16 2QE16 3QE16 4QE16 1QE

17 1, Capital Expenditure Increase in PP&E Net Income Attributable to Canon Inc. Depreciation 1, Free Cash Flow Operating C/F Free C/F Investing C/F FY14 FY15 FY16 FY17 FY17 Previous Current Projection Projection -5 FY14 FY15 FY16 FY17 FY17 Previous Current Projection Projection 17

18 Cash on Hand 1,5 Cash on Hand (Year-end) Cash-on-hand Cash-on-hand (In months of 2nd-half net sales, except FYE17, which is based on full-year net sales) , FYE13 FYE14 FYE15 FYE16 FYE17 Previous Note : Approx. 5 and 15 billion yen was used to acquire Projection own shares in 213 and 214, respectively. The cumulative amount since 27 is approx. 1.5 trillion yen. FYE17 Current Projection 18

19 Supplementary Information 19

20 Transition in Sales and Operating Profit FY 217 Current Projection v. FY 216 Actual Sales Op. Profit FY 216 Actual 3, Foreign Exchange Impact (Net Sales, Cost of Sales, Expenses) Sales Volume Impact Office Imaging System +1.7 Industry and Others Total Others Total Change FY 217 Current Projection 4, USD: 1EURO: Change in Exchange Rate to yen to yen Supplementary Information 2

21 Gross Profit Variance Analysis 1Q 217 Actual v. 1Q 216 Actual 1Q17 1Q16 Change 8 Gross Profit % Sales 48.1% 5.8% -2.7pt 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 217 Actual v. 1Q 216 Actual 1Q17 1Q16 Change Op. Profit % Sales 7.8% 5.% +2.8pt 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 45 3.% Debt Debt/Total Assets % 2.% 11.9% 12.8% 15.% 1.% 5.% %.%.% FYE13 FYE14 FYE15 FYE16 1QE17.% Supplementary Information 23

24 Financial Ratios (Yen) 9 15% 6 8.4% 8.7% 7.4% 5.6% 5.9% 5.% % 5.2% 3.5% 3.1% % 5% FY13 FY14 FY15 FY16 FY17 Current Projection EPS(Basic) (Attributable to Canon Inc.) ROE ROA % Supplementary Information 24