11 06-12 canon results-q2-1
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11 06-12 canon results-q2-1 Presentation Transcript

  • 1. Canon Inc. Second Quarter 2012 Results July 25, 2012 Toshizo Tanaka Executive Vice President & CFOThis 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 byavailable 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 orachievements 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 generaleconomic 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 targetedcustomers, 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 otherrisk factors is included in Canon‟s annual report on Form 20-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 underlyingassumptions 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. July 25, 2012 Canon Inc.
  • 2. Agenda2Q 2012 Results P3 – 5FY 2012 Projections P6 – 9Details by Business P10 – 16Financial Situation P17 – 19Supplementary Information P20 – 25 July 25, 2012 Canon Inc. 2
  • 3. 2Q 2012 in SummaryExternal Environment Global economic slowdown  Economic stagnation in Europe  Gradual recovery in the U.S.  Weakening growth in emerging markets Yen‟s appreciationResults Gained share through expanded sales of competitive products Maintained profitability through prompt response to changing external environment Achieved first increase in sales in three quarters and fourth consecutive increase in profits July 25, 2012 Canon Inc. 3
  • 4. Summary of Results 2Q 2012 Actual (Billions of yen) 2Q 2012 2Q 2011 Pct. Change Actual ActualNet Sales 899.2 836.6 +7.5%Gross Profit 439.9 418.5 +5.1%(% Sales) 48.9% 50.0%Op. Profit 92.6 78.4 +18.1%(% Sales) 10.3% 9.4%Net IncomeAttributable to Canon Inc. 51.7 53.9 -4.0%(% Sales) 5.8% 6.4%Foreign Exchange RateYen – 1USD 80.09 81.58Yen – 1EURO 102.34 117.28 July 25, 2012 Canon Inc. 4
  • 5. Transition in Sales and Op. Profit 2Q 2012 Actual v. 2Q 2011 Actual (Billions of yen) Sales Op. Profit 2Q 2011 Actual 836.6 78.4 Foreign Exchange Impact Change in Exchange Rate -44.1 -21.2 (Net Sales, Cost of Sales, Expenses) •1USD: 81.58 to 80.09 yen •1EURO: 117.28 to 102.34 yen Sales Volume Impact Office +26.3 Imaging System +83.0 Industry and Others +8.5 Total +117.8 +48.7 Others -11.1 -13.3 Total Change +62.6 +14.2 2Q 2012 Actual 899.2 92.6* The "Consumer Business Unit" has been renamed the "Imaging System Business Unit." July 25, 2012 Canon Inc. 5
  • 6. Assumptions 2012 Current ProjectionAverage 2H12 FY12 FY11Exchange Rate Yen-1USD 80.00 yen 79.96 yen 79.55 yen Yen-1EURO 100.00 yen 101.59 yen 110.72 yenImpact of Exchange Rate Movement (2H Impact Given a One Yen Change) Net Sales Operating Profit USD 10.4 billion yen 5.3 billion yen EURO 5.3 billion yen 2.9 billion yen July 25, 2012 Canon Inc. 6
  • 7. Key Points FY2012External Environment Gradual global economy growth Continued yen„s appreciationOutlook Expand share through active launch of new more innovative and competitive products Enhance profitability through manufacturing advancement Firmly achieve sales and profit growth July 25, 2012 Canon Inc. 7
  • 8. Summary of Projected Results FY 2012 Current Projection (Billions of yen) FY 2012 FY 2011 Pct. Change Current Projection ActualNet Sales 3,690.0 3,557.4 +3.7%Gross Profit 1,741.0 1,736.8 +0.2%(% Sales) 47.2% 48.8%Op. Profit 390.0 378.1 +3.2%(% Sales) 10.6% 10.6%Net IncomeAttributable to Canon Inc. 250.0 248.6 +0.6%(% Sales) 6.8% 7.0%Foreign Exchange RateYen – 1USD 79.96 79.55Yen – 1EURO 101.59 110.72 July 25, 2012 Canon Inc. 8
  • 9. Transition in Sales and Op. Profit FY 2012 Current Projection v. FY 2012 Previous Projection (Billions of yen) Sales Op. Profit Previous Projection (Apr. 25, 2012) 3,900.0 450.0 Change in Exchange Rate Foreign Exchange Impact •1USD: 79.94 to 79.96 yen -38.6 -21.1 •1EURO: 104.91 to 101.59 yen (Net Sales, Cost of Sales, Expenses) Sales Volume Impact Office -103.4 Imaging System -52.8 Industry and Others -35.2 Total -191.4 -91.2 Others +20.0 +52.3 Total Change -210.0 -60.0 Current Projection (Jul. 25, 2012) 3,690.0 390.0* The "Consumer Business Unit" has been renamed the "Imaging System Business Unit." July 25, 2012 Canon Inc. 9
  • 10. Office 2Q12 Growth Rate y/y (Unit Base) 2Q12 Color Ratio 2Q 2012 Actual Copiers Printers Copiers Printers Color +43% +41% Value Base* 54% 45% Monochrome +36% -1% Unit Base 33% 13% (Billions of yen) Sales Growth Rate y/y ( ) Local Currency Base Total +38% +3% *Includes Consumables800 Monochrome Copiers Color Copiers Printers Others Op. Profit Office600 -2.6%(+2.8%) Op. Profit (Billions of yen) Op. Profit Ratio 498 466 473 438 454 Growth Rate y/y400 -2.6% 14.3% 13.8% Printers 12.8% 12.8% 12.1% -8.4%(-5.8%)200 68 69 60 58 53 +9.2%(+15.6%) +3.4%(+8.4%) 0 2Q11 3Q11 4Q11 1Q12 2Q12 Copier Total 2Q11 3Q11 4Q11 1Q12 2Q12 +6.5%(+12.2%) July 25, 2012 Canon Inc. 10
  • 11. Office FY12 Growth Rate y/y (Unit Base) FY12 Color Ratio FY 2012 Projection Copiers Printers Copiers Printers Color +15% -2% Value Base* 54% 45% Monochrome +13% -12% Unit Base 34% 13% (Billions of yen) Sales Growth Rate y/y ( ) Local Currency Base Total +14% -11% *Includes Consumables3,000 Monochrome Copiers Color Copiers Printers Others2,500 Office Op. Profit -5.2%(-2.6%) 1,939 Op. Profit (Billions of yen)2,000 1,918 1,819 Op. Profit Ratio1,500 Growth Rate y/y -19.7% Printers 13.5% 12.5%1,000 -12.7%(-12.2%) 11.4% 259 243 208 500 +3.3%(+6.6%) +3.6%(+6.1%) 0 FY11 FY12 FY12 Copier Total FY11 FY12 FY12 Previous Current +3.4%(+6.4%) Previous Current Projection Projection Projection Projection July 25, 2012 Canon Inc. 11
  • 12. Imaging System Growth Rate y/y (Unit Base) Interchangeable Lens 2Q 2012 Actual Digital Camera Ratio * 2Q12 2Q12 Interchangeable Lens Value Base 75% +47% Digital Cameras (Billions of yen) Sales Compact Digital Cameras +31% Unit Base 31% Growth Rate y/y ( ) Local Currency Base * Proportion of 600 Total Digital Cameras +35% Total Digital Cameras IJP +2% Digital Cameras IJP Others Imaging System Op. Profit +22.3%(+28.3%) Op. Profit (Billions of yen) 400 373 370 Op. Profit Ratio 347 IJP 302 303 Growth Rate y/y -4.0%(+0.4%) 21.6% +23.6% 200 15.4% 15.0% 15.1% 13.7% Digital 75 Cameras 56 51 47 45 +29.6%(+35.9%) 0 2Q11 3Q11 4Q11 1Q12 2Q12 2Q11 3Q11 4Q11 1Q12 2Q12* The "Consumer Business Unit" has been renamed the "Imaging System Business Unit." July 25, 2012 Canon Inc. 12
  • 13. Imaging System Growth Rate y/y (Unit Base) Interchangeable Lens FY 2012 Projection Digital Camera Ratio * FY12 FY12 Interchangeable Lens Value Base 76% +27% Digital Cameras (Billions of yen) Sales Growth Rate y/y ( ) Local Currency Base Compact Digital Cameras +12% Unit Base 30%2,500 * Proportion of Total Digital Cameras +16% Total Digital Cameras IJP +1% Digital Cameras IJP Others Imaging System2,000 +16.5%(+18.8%) Op. Profit Op. Profit (Billions of yen) 1,580 1,528 Op. Profit Ratio1,500 1,312 IJP Growth Rate y/y +0.6%(+2.9%) +26.8%1,000 18.4% Digital 17.5% 16.1% Cameras 290 500 268 +18.6%(+20.8%) 211 0 FY11 FY12 FY12 FY11 FY12 FY12 Previous Current Previous Current Projection Projection Projection Projection * The "Consumer Business Unit" has been renamed the "Imaging System Business Unit." July 25, 2012 Canon Inc. 13
  • 14. New Products Mirrorless Cameras High image quality befitting the EOS brand Compact and lightweight Compatibility with extensive lineup of EF lensesNew series of EOS cameras to attract new users July 25, 2012 Canon Inc. 14
  • 15. Industry and Others Lithography Equipment IC Stepper Unit Breakdown 2Q 2012 Actual (Unit Sales) by Light Source 2Q11 2Q12 2Q11 2Q12 IC 8 19 ArF 0 0 FPD 2 7 KrF 2 1 (Billions of yen) Sales Growth Rate y/y ( ) Local Currency Base FPD : Flat Panel Display i-line 6 18 180 Sales Eliminations Lithography Equipment Others Industry and Others 150 Net Sales +9.9%(+11.3%) Op. Profit 98 20 120 95 89 14.0% Op. Profit (Billions of yen) Net Sales 77 Op. Profit Ratio 70 15 12.0% 90 Gross Sales Growth Rate y/y 10.0% 103 84 +7.8%(+8.9%) 91 10 7.3% +31.0%Gross Sales 60 77 8.0% (Includes Gross 6.4% 78 Grosssales among 98 91 5.3% 6.0% Groupbusinesses) 5 3.6% 30 9 3.3% 4.0% 6 Sales 30 (Litho. Equip.) 5 4 4 21 19 22 Eliminations 13 +62.6%(+63.5%) 2.0% (Sales 0 0among Group -19 *Calculation of operating profit ratio includes -21 -25 -20 -21 0.0% businesses) intersegment sales -30 -5 -2.0% 2Q11 3Q11 4Q11 1Q12 2Q12 2Q11 3Q11 4Q11 1Q12 2Q12 July 25, 2012 Canon Inc. 15
  • 16. Industry and Others Lithography Equipment IC Stepper Unit Breakdown FY 2012 Projection (Unit Sales) by Light Source FY12 FY12 FY12 FY12 FY11 Previous Current FY11 Previous Current Projection Projection Projection Projection (Billions of yen) Sales Growth Rate y/y ( ) Local Currency Base IC 52 70 53 ArF 0 0 0 600 FPD 25 16 16 KrF 7 10 6 Sales Eliminations FPD : Flat Panel Display i-line 45 60 47 Lithography Equipment Industry and Others Others 500 Net Sales 387 +4.1%(+4.5%) Net Sales 334 348 50 Op. Profit 25.0% 400 Op. Profit (Billions of yen) Op. Profit Ratio 20.0% Gross Sales 40 300 +2.6%(+2.9%) 15.0% 389 30 339 366 Gross Growth Rate y/y Gross 432 10.0%Gross Sales 200 421 -49.8% (Includes 20 5.8%sales among Group 2.9% 2.8% 5.0%businesses) 100 24 10 (Litho. Equip.) 13 0.0% 82 77 12 Sales 66 -18.8%(-18.7%) Eliminations 0 0 (Sales -5.0%among Group -87 -79 -84 *Calculation of operating profit ratio includes businesses) intersegment sales -100 -10 -10.0% FY11 FY12 FY12 FY11 FY12 FY12 Previous Current Previous Current Projection Projection Projection Projection July 25, 2012 Canon Inc. 16
  • 17. Inventories800 90 Amount (Billions of yen) 80 Turnover (days)700 70 56 57 54 60 52600 45 46 46 554 50 42 542 518 35 40500 471 479 477 30 428 436400 385 20 10300 0 2QE10 3QE10 4QE10 1QE11 2QE11 3QE11 4QE11 1QE12 2QE12 July 25, 2012 Canon Inc. 17
  • 18. Capital Free Cash Flow Expenditure(Billions of yen) (Billions of yen) 1,000 1,000 Increase in PP&E Operating C/F Net Income Attributable to Canon Inc. Free C/F Depreciation Investing C/F 750 750 402 241 500 500 190 177 290 247 249 250 132 744 213 611 560 505 250 250 470 370 370 342 328 315 300 280 276 265 261 260 257 227 216 159 0 0 FY09 FY10 FY11 FY12 FY12 FY09 FY10 FY11 FY12 FY12 Previous Current Previous Current Projection Projection Projection Projection July 25, 2012 Canon Inc. 18
  • 19. Cash on Hand Cash on Hand (Year-end)1500 4 Cash-on hand (Bilions of yen) Cash-on-hand (In months of 2nd-half net sales) 3.5 2.8 31000 2.5 2.5 2.4 2.5 2.1 2.1 841 795 773 770 2 679 700 1.5 500 1 0.5 0 0 FYE08 FYE09 FYE10 FYE11 FYE12 FYE12 Previous Current Projection Projection Note 1: 450, 100, 50, and 100 billion yen was used to acquire own shares in 2007,2008, 2010 and 2011, respectively. In 2012, the year-to-date total is 100 billion yen. July 25, 2012 Canon Inc. 19
  • 20. Supplementary Information July 25, 2012 Canon Inc. 20
  • 21. Transition in Sales and Operating Profit FY 2012 Current Projection v. FY 2011 Actual (Billions of yen) Sales Op. Profit FY 2011 Actual 3,557.4 378.1 Change in Exchange Rate Foreign Exchange Impact •1USD: 79.55 to 79.96 yen -75.5 -37.9 •1EURO: 110.72 to 101.59 yen (Net Sales, Cost of Sales, Expenses) Sales Volume Impact Office +5.2 Imaging System +273.5 Industry and Others +19.4 Total +298.1 +78.3 Others -90.0 -28.5 Total Change +132.6 +11.9 FY 2012 Current Projection 3,690.0 390.0* The "Consumer Business Unit" has been renamed the "Imaging System Business Unit." Supplementary Information July 25, 2012 Canon Inc. 21
  • 22. Gross Profit Variance Analysis 2Q 2012 Actual v. 2Q 2011 Actual (Billions of yen) 2Q12 2Q11 Change(Billions of yen) Gross Profit 439.9 418.5 +21.4 % Sales 48.9% 50.0% -1.1 pt. 60 48.7 30 21.4 12.2 8.2 7.5 0 -11.1 -30 -44.1 -60 Forex Sales Price Forex Cost Others Total Impact Volume Change Impact Reduction Change on Impact on in Gross Sales Costs Profit Supplementary Information July 25, 2012 Canon Inc. 22
  • 23. Operating Profit Variance Analysis 2Q 2012 Actual v. 2Q 2011 Actual (Billions of yen) 2Q12 2Q11 Change Op. Profit 92.6 78.4 +14.2(Billions of yen) % Sales 10.3% 9.4% +0.9 pt. 60 30 21.4 14.7 14.2 0 -30 -21.9 -60 Total Change in Change in Total Change in SG & A SG & A Change in Gross Profit (Excluding (Forex Impact) Operating Profit Forex Impact) Supplementary Information July 25, 2012 Canon Inc. 23
  • 24. Interest Bearing Debt(Billions of yen) 50 5.0% Debt Debt/Total Assets 40 4.0% 30 3.0% 20 2.0% 14 11 12 10 10 7 1.0% 0.4% 0.3% 0.3% 0.3% 0.2% 0 0.0% FYE08 FYE09 FYE10 FYE11 2QE12 Supplementary Information July 25, 2012 Canon Inc. 24
  • 25. Financial Ratios(Yen) 900 15% 11.1% 9.6% 9.7% 600 9.2% 10% 7.3% 6.3% 6.3% 6.3% 4.9% 300 246.21 5% 3.4% 199.71 204.49 213.46 106.64 0 0% FY08 FY09 FY10 FY11 FY12 Current Projection EPS(Basic) ROE ROA (Attributable to Canon Inc.) Supplementary Information July 25, 2012 Canon Inc. 25