Canon Inc. · TSE:7751
Canon — Q3 2021 Earnings Presentation
27 slides from Canon's earnings presentation, Oct 26, 2021
Slide 1: Third Quarter 2021 Results
Canon Inc. Third Quarter 2021 Results October 26, 2021 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 assump
Slide 2: Agenda
Agenda 3Q 2021 Results P2 – 4 FY 2021 Projection P5 – 8 Details by Business P9 – 16 (3Q 2021 Results & FY 2021 Projection) Financial Situation P17 – 18 Sustainability Measures P19 Excellent Global Corporation Plan Phase VI P20 Supplementary Information P21 – 25 1
Slide 3: Key Message (3Q 2021 Results)
Key Message (3Q 2021 Results) External Environment 3Q 2021 3Q 2020 (Billions of yen) % Change No significant change in Actual Actual demand, despite COVID-19 Net Sales 833.3 758.9 +9.8% cases rising again Gross Profit 388.0 327.6 +18.4% Significant confusion in (% of Net Sales) 46.6% 43.2% suppl
Slide 4: FY 2021 Financial Results by Business Unit
FY 2021 Financial Results by Business Unit (3Q 2021 Actual versus 3Q 2020 Actual) Printing and Imaging - Sales and profit growth in 3Q, double-digit profitability every quarter this year Medical - 4th consecutive quarter of sales growth, Industrial & Others - Sales growth and profit decline 3Q 2
Slide 5: FY 2021 Operating Profit Analysis
FY 2021 Operating Profit Analysis (3Q 2021 Actual versus 3Q 2020 Actual) Growth in Printing service revenue and consumables contributes to profit increase Increase in expenses linked to sales and development Change in Net Sales, excluding FX (Billions of yen) impact, for reference Printing: +9.8
Slide 6: Key Message (FY 2021 Projection)
Key Message (FY 2021 Projection) FX Assumptions Impact of exchange rate movement （4Q impact given a one yen change） 4Q 2021 FY 2021 Net Sales Op. Profit USD/Yen 112.00 yen 109.49 yen 3.0 billion yen 1.0 billion yen EUR/Yen 130.00 yen 129.92 yen 1.6 billion yen 0.8 billion yen External Environment
Slide 7: FY 2021 Financial Projection
FY 2021 Financial Projection (Full Year) Significant improvement in both gross profit and operating expense ratios Maintained previous projection for net sales and net income FY 2021 FY 2021 FY 2020 Amount (Billions of yen) Current % Change Previous Actual Change Projection Projection Net Sales
Slide 8: FY 2021 Financial Projection by Business Unit
FY 2021 Financial Projection by Business Unit (Full Year) Expect to maintain double-digit profitability for both Printing and Imaging for full year Lowered projection for Medical due to COVID-19 impact FY 2021 FY 2021 FY 2020 Amount (Billions of yen) Current % Change Previous Actual Change Proje
Slide 9: FY 2021 Operating Profit Analysis
FY 2021 Operating Profit Analysis (FY 2021 Current Projection versus Previous Projection) Work to improve product mix and respond to pricing amid decline in unit sales Supplying products prioritized, leads to increases in parts, manufacturing, and logistical, costs (Billions of yen) Change in Ne
Slide 10: Printing – Office
Printing – Office Entering second half of year, impact on manufacturing due to parts procurement issues becomes apparent Limit product supply issues as much as possible, taking steps from manufacturing and logistical perspectives (Billions of yen) 3Q Full Year 2021 2021 2021 2020 % 2020 % Amount
Slide 11: Printing – Prosumer
Printing – Prosumer 3Q: Significant decrease in capacity utilization of manufacturing sites in Southeast Asia due to COVID-19 cases rising again Work to stably supply products via parallel manufacturing, expansion of parts suppliers etc. (Billions of yen) 3Q Full Year 2021 2021 2021 2020 % 2020
Slide 12: Printing – Production
Printing – Production Sales of products launched last year remain solid Expand sales through lineup enhancement and new dealers (Billions of yen) 3Q Full Year 2021 2021 2021 2020 % 2020 % Amount Current Previous Actual Actual Change Actual Change Change Projection Projection Office 174.4 173.2 +
Slide 13: Imaging – Cameras
Imaging – Cameras Lowered projection due to parts shortage. Now expect size of camera market to be 5.9 million units Strong sales of EOS R5 and EOS R6, even after being in the market for a year Unveiled first lens specifically designed to capture VR images (Billions of yen) 3Q Full Year 2021 2
Slide 14: Imaging – Network Cameras & Others
Imaging – Network Cameras & Others Network camera market continues to recover along with normalization of economy Order situation good, aiming for 19% full-year sales growth (Billions of yen) 3Q Full Year 2021 2021 2021 2020 % 2020 % Amount Current Previous Actual Actual Change Actual Change Cha
Slide 15: Medical
Medical 3Q: Sales and profit growth, partially thanks to Japan's economic stimulus package and despite global supply shortages 4Q: Secure sales, despite continuing impact of supply shortages, through optimization of product distribution From a medium- to long-term perspective, aim for early st
Slide 16: Industrial & Others – Lithography Equipment
Industrial & Others – Lithography Equipment Semiconductor lithography equipment - Service revenue also increased thanks to robust equipment demand FPD lithography equipment - 68 units sold, thanks to progress made in installation even amid severe restrictions (Billions of yen) 3Q Full Year 2021
Slide 17: Industrial & Others – Industrial Equipment
Industrial & Others – Industrial Equipment Solid demand for equipment, thanks to increasing number of products using OLED panels (Billions of yen) 3Q Full Year 2021 2021 2021 2020 % 2020 % Amount Current Previous Actual Actual Change Actual Change Change Projection Projection Lithography Equipment
Slide 18: Inventory
Inventory Inventory at Sept.-end temporary increased due to COVID-19 cases rising again Expect reduction in inventory towards year end through improvement in utilization ratio of manufacturing sites FY 2020 FY 2021 (Billions of yen) Mar.-end Jun.-end Sep.-end Dec.-end Mar.-end Jun.-end Sep.-end
Slide 19: Cash Flow (Full Year)
Cash Flow (Full Year) Previous projection for FCF maintained at 230 billion yen Repaying debt in line with plan, strengthening financial constitution FY 2021 FY 2021 FY 2020 Current Previous Actual (Billions of yen) Projection Projection Net cash provided by operating activities 440.0 430.0 333.
Slide 20: Sustainability Measures
Sustainability Measures Promote various activities that contribute to region and society Expand support for Sustainable COVID-19 testing Society Mobile medical solution Expand global rollout of Biodiversity conservation Enhance learning of environment Canon Bird Branch Project Canon Eco Technology
Slide 21: Excellent Global Corporation Plan Phase VI
Excellent Global Corporation Plan Phase VI Progress in existing business recovery and new business growth Making company-wide efforts to improve performance, achieve 2025 target (Net Sales: Trillions of yen) (Operating Profit: Billions of yen) 5 1,000 Over 4,500.0 Billion Net Sales 4 800 3,600.0
Slide 22: Supplementary Information
Supplementary Information
Slide 23: FY 2021 Operating Profit Analysis
FY 2021 Operating Profit Analysis (FY 2021 Current Projection versus FY 2020 Actual) (Billions of yen) FX Details Net Sales: +100.6 Cost of Sales: -21.7 Op. Expenses: -32.5 Change in Net Sales, excluding FX impact, for reference Printing: +128.6 Imaging: +101.4 Medical: +21.5 Industrial & Others: +9
Slide 24: Printing - Net Sales Growth Rate Y/Y (Hardware & Non-hardware)
Printing - Net Sales Growth Rate Y/Y (Hardware & Non-hardware) FY 2021 FY 2020 3Q Full Year 3Q Full Year Actual Projection Actual Actual Hardware -11% +20% -17% -21% JPY Non-hardware +4% +4% -21% -20% Office MFDs Hardware -14% +16% -17% -20% LC Non-hardware +1% +1% -21% -20% Hardware -19% +12% -16%
Slide 25: Office MFDs - Net Sales Growth Rate Y/Y (Monochrome & Color)
Office MFDs - Net Sales Growth Rate Y/Y (Monochrome & Color) FY 2021 FY 2020 3Q Full Year 3Q Full Year Actual Projection Actual Actual Monochrome +1% +8% -21% -22% JPY Color -5% +13% -18% -19% Monochrome -3% +5% -21% -22% LC Color -8% +9% -19% -19% Office/Prosumer - Net Sales by Product Category (Bi
Slide 26: Office MFDs/LPs - Color Ratio
Office MFDs/LPs - Color Ratio FY 2021 FY 2020 3Q Full Year 3Q Full Year Actual Projection Actual Actual Net Sales 58% 60% 59% 59% Office MFDs Units 53% 60% 60% 59% Net Sales 51% 51% 47% 51% LPs Units 14% 18% 19% 21% Office MFDs/LPs - Unit Sales Growth Rate Y/Y (Monochrome & Color) FY 2021 FY 2020 3Q
Slide 27: DILC Ratio & Digital Compact Camera (DCC) Units
DILC Ratio & Digital Compact Camera (DCC) Units FY 2021 FY 2020 3Q Full Year 3Q Full Year Actual Projection Actual Actual DILC Ratio Net Sales * 90% 90% 88% 87% Units 70% 71% 64% 65% DCC Units (Millions) 0.28 1.20 0.36 1.48 * Net Sales includes interchangeable lenses Semiconductor Lithography Equipm