Slide 1: Third Quarter 2013 Results
Canon Inc. Third Quarter 2013 Results October 24, 2013 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 2013 Results P3 – 5 FY 2013 Projections P6 – 9 Details by Business P10 – 15 Financial Situation P16 – 18 Supplementary Information P19 – 24 October 24, 2013 Canon Inc. 2
Slide 3: 3Q 2013 in Summary
3Q 2013 in Summary External Environment Increasing signs of slowdown amid prolonged global economic weakness Yen’s depreciation Results Posted second consecutive quarter of growth in both net sales and profits Maintaining or improving market share – enhancing competitiveness through the laun
Slide 4: Summary of Results
Summary of Results 3Q 2013 Actual (Billions of yen) 3Q 2013 3Q 2012 Pct. Change Actual Actual Net Sales 913.1 799.9 +14.2% Gross Profit 447.1 386.8 +15.6% (% Sales) 49.0% 48.3% Op. Profit 90.6 70.9 +27.8% (% Sales) 9.9% 8.9% Net Income Attributable to Canon Inc. 58.8 50.1 +17.3% (% Sales) 6.4% 6.3%
Slide 5: Transition in Sales and Op. Profit
Transition in Sales and Op. Profit 3Q 2013 Actual v. 3Q 2012 Actual (Billions of yen) Sales Op. Profit 3Q 2012 Actual 799.9 70.9 Foreign Exchange Impact Change in Exchange Rate +141.3 +53.1 (Net Sales, Cost of Sales, Expenses) •1USD: 78.58 to 98.91 yen •1EURO: 98.48 to 131.09 yen Sales Volume Impact
Slide 6: Assumptions
Assumptions 2013 Current Projection Average 4Q13 FY13 FY12 Exchange Rate Yen-1USD 97.00 yen 96.95 yen 79.96 yen Yen-1EURO 130.00 yen 128.24 yen 102.80 yen Impact of Exchange Rate Movement (4Q Impact Given a One Yen Change) Net Sales Operating Profit USD 4.7 billion yen 1.8 billion yen EURO 2
Slide 7: Key Points FY2013
Key Points FY2013 External Environment Uncertainty towards year-end selling season amid expectations that economic situations in Europe and emerging markets such as China will remain challenging Outlook Revised projections, primarily for interchangeable-lens cameras Aim to firmly secure sales
Slide 8: Summary of Projected Results
Summary of Projected Results FY 2013 Current Projection (Billions of yen) FY 2013 FY 2012 Pct. Change Current Projection Actual Net Sales 3,750.0 3,479.8 +7.8% Gross Profit 1,811.2 1,650.0 +9.8% (% Sales) 48.3% 47.4% Op. Profit 360.0 323.9 +11.2% (% Sales) 9.6% 9.3% Net Income Attributable to Canon
Slide 9: Transition in Sales and Op. Profit
Transition in Sales and Op. Profit FY 2013 Current Projection v. FY 2013 Previous Projection (Billions of yen) Sales Op. Profit Previous Projection (Jul. 24, 2013) 3,850.0 380.0 Change in Exchange Rate Foreign Exchange Impact •1USD: 95.46 to 96.95 yen +47.7 +24.0 •1EURO: 125.42 to 128.24 yen (Net Sa
Slide 10: Office
3Q13 Growth Rate y/y (Unit Base) 3Q13 Color Ratio Office Color Copiers +9% Printers +31% Value Base* Copiers 54% Printers 46% Monochrome -7% +22% Unit Base 36% 15% 3Q 2013 Actual Total -2% +24% *Includes Consumables (Billions of yen) Sales Growth rate y/y ( ) Local currency base 800 Monochrome copie
Slide 11: Office
FY13 Growth Rate y/y (Unit Base) FY13 Color Ratio Office Color Copiers +10% Printers +15% Value Base* Copiers 55% Printers 47% Monochrome -2% +12% Unit Base 36% 14% FY 2013 Projection Total +2% +12% *Includes Consumables (Billions of yen) Sales Growth rate y/y ( ) Local currency base 3,000 Monochrom
Slide 12: Imaging System
Growth Rate y/y (Unit Base) Interchangeable Lens Imaging System Interchangeable Lens 3Q13 -3% Digital Camera Ratio * 3Q13 Digital Cameras Value Base 83% 3Q 2013 Actual Compact Digital -31% Unit Base 41% Cameras Total Digital Cameras -22% * Proportion of Total Digital Cameras IJP -2% * Value Base Inc
Slide 13: Imaging System
Growth Rate y/y (Unit Base) Interchangeable Lens Imaging System Interchangeable Lens FY13 -3% Digital Camera Ratio * FY13 Digital Cameras Value Base 81% FY 2013 Projection Compact Digital -24% Unit Base 36% Cameras Total Digital Cameras -17% * Proportion of Total Digital Cameras IJP +1% * Value Base
Slide 14: Industry and Others
Industry and Others Lithography Equipment IC Lithography Unit Breakdown by Light Source (Unit Sales) 3Q12 3Q13 3Q 2013 Actual 3Q12 3Q13 ArF 0 0 IC 8 10 KrF 0 0 FPD 3 0 i-line 8 10 (Billions of yen) Sales Growth Rate y/y ( ) Local Currency Base 180 Sales Eliminations Lithography Equipment Others 150
Slide 15: Industry and Others
Industry and Others Lithography Equipment IC Lithography Unit Breakdown by Light Source (Unit Sales) FY13 FY13 FY 2013 Projection FY13 FY13 FY12 Previous Current FY12 Previous Current Projection Projection Projection Projection ArF 0 0 0 (Billions of yen) Sales Growth Rate y/y ( ) Local Currency Bas
Slide 16: Inventories
Inventories (Billions of yen) 800 Amount (Billions of yen) 90 Turnover (Days) 700 63 61 60 70 56 57 57 59 54 46 608 50 600 591 589 582 554 542 552 30 518 500 477 10 -10 400 -30 300 -50 3QE11 4QE11 1QE12 2QE12 3QE12 4QE12 1QE13 2QE13 3QE13 October 24, 2013 Canon Inc. 16
Slide 17: Capital Expenditure and Free Cash Flow
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 750 750 402 500 500 150 215 247 260 249 240 744 225 213 171 515 485 250 250 470 384 342 335 300 276 270 261 260
Slide 18: Cash on Hand
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 3 1000 2.5 2.5 2.3 2.2 2.5 2.0 841 795 773 2 690 710 667 1.5 500 1 0.5 0 0 FYE09 FYE10 FYE11 FYE12 FYE13 FYE13 Previous Current Projection Projection Note : 450, 100, 50,
Slide 19: Supplementary Information
Supplementary Information October 24, 2013 Canon Inc. 19
Slide 20: Transition in Sales and Operating Profit
Transition in Sales and Operating Profit FY 2013 Current Projection v. FY 2012 Actual (Billions of yen) Sales Op. Profit FY 2012 Actual 3,479.8 323.9 Foreign Exchange Impact +488.7 +217.8 Change in Exchange Rate (Net Sales, Cost of Sales, Expenses) •1USD: 79.96 to 96.95 yen •1EURO: 102.80 to 128.24
Slide 21: Gross Profit Variance Analysis
Gross Profit Variance Analysis 3Q 2013 Actual v. 3Q 2012 Actual (Billions of yen) 3Q13 3Q12 Change (Billions of yen) Gross Profit 447.1 386.8 +60.3 % Sales 49.0% 48.3% +0.7pt. 150 141.3 100 60.3 50 11.6 0 -8.8 -36.1 -50 -47.7 -100 Forex Sales Price Forex Cost Total Impact Volume Change Impact Reduct
Slide 22: Operating Profit Variance Analysis
Operating Profit Variance Analysis 3Q 2013 Actual v. 3Q 2012 Actual (Billions of yen) 3Q13 3Q12 Change Op. Profit 90.6 70.9 +19.7 (Billions of yen) % Sales 9.9% 8.9% +1.0pt. 150 100 60.3 50 19.7 0 -0.1 -50 -40.5 -100 Total Change in Change in Total Change in SG & A SG & A Change in Gross Profit (Exc
Slide 23: Interest Bearing Debt
Interest Bearing Debt (Billions of yen) 50 5.0% Debt Debt/Total Assets 40 4.0% 30 3.0% 20 2.0% 11 12 10 10 1.0% 0.3% 0.3% 0.3% 4 3 0.1% 0.1% 0 0.0% FYE09 FYE10 FYE11 FYE12 3QE13 Supplementary Information October 24, 2013 Canon Inc. 23
Slide 24: Financial Ratios
Financial Ratios (Yen) 900 15% 9.2% 9.6% 600 8.9% 10% 8.7% 6.3% 6.3% 5.7% 5.9% 4.9% 300 5% 3.4% 199.71 204.49 209.07 191.34 106.64 0 0% FY09 FY10 FY11 FY12 FY13 Current Projection EPS(Basic) ROE ROA (Attributable to Canon Inc.) Supplementary Information October 24, 2013 Canon Inc. 24