FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934

 

For the month of ….		October		……………………………………………… ,		2013

 

		CANON INC.
		(Translation of registrant’s name into English)
		30-2, Shimomaruko 3-Chome, Ohta-ku, Tokyo 146-8501, Japan
		(Address of principal executive offices)

[Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

 

Form 20-F		X		Form 40-F

[Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

 

Yes				No		X

[If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):82-………………..

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

						CANON INC.
						(Registrant)
Date….		October 25, 2013				By ……/s/…… Shinichi    Aoyama ………
						(Signature)*

 

*Print the name and title of the signing officer under his signature.

The following materials are included.

1. CONSOLIDATED RESULTS FOR THE THIRD QUARTER AND THE NINE MONTHS ENDED SEPTEMBER 30, 2013

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CONSOLIDATED RESULTS FOR THE THIRD QUARTER AND THE NINE MONTHS ENDED SEPTEMBER 30, 2013

October 24, 2013

CONSOLIDATED RESULTS FOR THE THIRD QUARTER

(Millions of yen, thousands of U.S. dollars, except per share amounts)

 

		Actual
		Three months ended September 30, 2013				Three months ended September 30, 2012				Change(%)								Three months ended September 30, 2013
Net sales		¥	913,149			¥	799,949				+				14.2			$	9,317,847
Operating profit			90,610				70,877				+				27.8				924,592
Income before income taxes			88,056				75,180				+				17.1				898,531
Net income attributable to Canon Inc.		¥	58,822			¥	50,139				+				17.3			$	600,224
Net income attributable to Canon Inc. stockholders per share:
- Basic		¥	51.20			¥	43.15				+				18.7			$	0.52
- Diluted			51.20				43.15				+				18.7				0.52
CONSOLIDATED RESULTS FOR THE NINE MONTHS   (Millions of yen, thousands of U.S. dollars, except per share amounts)
		Actual																				Projected
		Nine months ended September 30, 2013				Nine months ended September 30, 2012				Change(%)								Nine months ended September 30, 2013				Year ending December 31, 2013				Change(%)
Net sales		¥	2,696,682			¥	2,528,394				+				6.7			$	27,517,163			¥	3,750,000				+				7.8
Operating profit			243,737				246,152				-				1.0				2,487,112				360,000				+				11.2
Income before income taxes			247,179				253,449				-				2.5				2,522,235				360,000				+				5.1
Net income attributable to Canon Inc.		¥	166,231			¥	163,391				+				1.7			$	1,696,235			¥	240,000				+				6.9
Net income attributable to Canon Inc. stockholders per share:
- Basic		¥	144.40			¥	138.48				+				4.3			$	1.47			¥	209.07				+				9.3
- Diluted			144.39				138.47				+				4.3				1.47				-								-
		Actual
		As of September 30, 2013				As of December 31, 2012				Change(%)								As of September 30, 2013
Total assets		¥	4,045,159			¥	3,955,503				+				2.3				$    41,277,133
Canon Inc. stockholders’ equity		¥	2,709,442			¥	2,598,026				+				4.3				$    27,647,367

 

Notes:		1.		Canon’s consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles.
		2.		U.S. dollar amounts are translated from yen at the rate of JPY98=U.S.$1, the approximate exchange rate on the Tokyo Foreign Exchange Market as of September 30, 2013, solely for the convenience of the reader.

 

Canon Inc.		30-2, Shimomaruko 3-chome, Ohta-ku,
Headquarter office		Tokyo 146-8501, Japan
		Phone: +81-3-3758-2111

 

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I. Operating Results and Financial Conditions

2013 Third Quarter in Review

Looking back at the global economy in the third quarter of 2013, in the United States, although the economy continued to recover, personal spending was lacking in strength, while in Europe, the economy remained sluggish owing to austere fiscal policy. In China the pace of economic growth remained weak and the economies of other emerging countries in Asia faced slow growth due to declines in local currency values. The Japanese economy continued to recover amid improvements in the export environment along with the positive effects of stimulation measures. As for the global economy overall, there were increasing signs of a slowdown amid the prolonged economic stagnation.

As for the markets in which Canon operates amid these conditions, among office multifunction devices (MFDs), although demand for monochrome models continued to shrink, color models continued to drive growth and demand for laser printers entered a phase of moderate growth. Although demand for interchangeable-lens digital cameras showed strong growth in Japan, the expected rebound in overseas demand was delayed, while demand for digital compact cameras continued to shrink both in developed countries and emerging markets. Demand for inkjet printers followed a decreasing trend due to the slowdown in emerging economies. In the industry and others sector, demand for semiconductor lithography equipment began to pick up amid a recovery trend from suppressed capital expenditure for memory devices, while lithography equipment used in the production of flat panel displays (FPD) showed healthy market growth for mid- and small-size panels used mainly in smartphones and tablet PCs, and a gradual recovery in demand for large-size panels.

The average values of the yen during the third quarter and first nine months of the year were ¥98.91 and ¥96.92 to the U.S. dollar, respectively, year-on-year depreciations of approximately ¥20 and ¥17, and ¥131.09 and ¥127.54 to the euro, respectively, year-on-year depreciations of approximately ¥33 and ¥26.

Steady sales growth of competitive MFDs and laser printers, along with efforts to increase and maintain market share through the introduction of new interchangeable-lens digital camera and inkjet printer products featuring advanced technologies, led to an increase in third-quarter net sales of 14.2% to ¥913.1 billion (U.S.$9,318 million) from the year-ago period, while net sales for the nine months ended September 30, 2013 totaled ¥2,696.7 billion (U.S.$27,517 million), a year-on-year increase of 6.7%. The gross profit ratio for the third quarter rose 0.7 points year on year to 49.0% thanks to the effects of ongoing cost-cutting efforts along with the depreciation of the yen. The gross profit ratio for the first nine months of the year also increased by 0.4 points to 48.6%. Despite an increase in foreign-currency-denominated operating expenses after conversion into yen due to the depreciation of the yen, Group-wide efforts to thoroughly reduce spending contributed to limiting the increase in operating expenses for the third-quarter to just ¥356.5 billion (U.S.$3,638 million), an increase of 12.9% year on year. Consequently, third-quarter operating profit increased by 27.8% to ¥90.6 billion (U.S.$925 million) compared with the corresponding period of the previous year. Other income decreased by ¥6.9 billion (U.S.$70 million) for the third quarter from the year-ago period due to foreign currency exchange losses while income before income taxes increased by 17.1% year on year to ¥88.1 billion (U.S.$899 million). Third-quarter net income attributable to Canon Inc. increased by 17.3% to ¥58.8 billion (U.S.$600 million) for the third quarter. Operating profit for the initial nine months of the year decreased by 1.0% to ¥243.7 billion (U.S.$2,487 million) owing to the large decline in the first quarter, while income before income taxes decreased 2.5% year on year to ¥247.2 billion (U.S.$2,522 million) over the same period. Net income attributable to Canon Inc. increased by 1.7% to ¥166.2 billion (U.S.$1,696 million) for the nine months ended September 30, 2013.

Basic net income attributable to Canon Inc. stockholders per share for the quarter was ¥51.20 (U.S.$0.52), an increase of ¥8.05 (U.S.$0.08) compared with the corresponding quarter of the previous year, and ¥144.40 (U.S.$1.47) for the first nine months of 2013, a year-on-year increase of ¥5.92 (U.S.$0.06).

 

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Results by Segment

Looking at Canon’s quarterly performance by business unit, within the Office Business Unit, within the office MFD, sales of color models increased from the year-ago period led by the imageRUNNER ADVANCE C5200/C2200 series, while among production printing systems, the imagePRESS C6010 series continued to perform steadily. As for high speed continuous feed printers and wide-format printers, sales of the Océ ColorStream 3000 series showed solid growth. With regard to laser printers, laser multifunction models recorded strong growth contributing to a year-on-year increase in sales volume. As a result, third-quarter sales for the business unit totaled ¥493.9 billion (U.S.$5,039 million), an increase of 20.6% year on year, while operating profit totaled ¥67.1 billion (U.S.$685 million) an increase of 63.1%. Sales for the combined first nine months of the year totaled ¥1,478.1 billion (U.S.$15,083 million), increasing 13.6% year on year, while operating profit increased by 33.5% to ¥203.4 billion (U.S.$2,075 million).

Within the Imaging System Business Unit, sales of the EOS 5D Mark III, 6D and 70D advanced-amateur-model interchangeable-lens digital cameras continued to grow. Furthermore, especially in Japan, the new entry-level EOS Digital Rebel SL1/T5i cameras proved popular, further contributing to sales and helping the company to maintain its top share of the global market. As for digital compact cameras, although total sales volume declined due to the market slowdown and the increasing popularity of smartphones, sales volume increased from the previous year for such high added-value products as the PowerShot SX50 HS and SX510 HS, each equipped with a high-magnification zoom lens that exceeds the capabilities of lenses offered by smartphones. With regard to inkjet printers, although sales volume of hardware dipped from the year-ago period due to decreased demand in Asian markets, sales of consumable supplies enjoyed solid growth due to the steady accumulation of units currently in operation within the market. As a result, third-quarter sales for the business unit increased by 8.2% to ¥348.6 billion (U.S.$3,558 million), while operating profit totaled ¥56.9 billion (U.S.$581 million), an increase of 8.2%. Sales for the first nine months totaled ¥1,032.8 billion (U.S.$10,538 million), rising 3.8% year on year, while operating profit totaled ¥141.7 billion (U.S.$1,446 million), a decrease of 8.8% year on year.

In the Industry and Others Business Unit, within the semiconductor lithography equipment, sales volume of lithography equipment for memory devices increased from the previous year fueled by renewed investment in capital expenditure by memory manufacturers. As for FPD lithography equipment, although no sales were recorded during the quarter, preparations for fourth quarter sales are proceeding smoothly amid the recovery trend in investment for large-size panels. Consequently, third-quarter sales for the segment totaled ¥95.1 billion (U.S.$970 million), a year-on-year increase of 2.3%, while operating profit decreased ¥13.2 billion (U.S.$134 million), posting a loss of ¥8.1 billion (U.S.$83 million). Sales for the first nine months of the year totaled ¥256.1 billion (U.S.$2,613 million), a decrease of 14.9% year on year, while operating profit recorded a loss of ¥21.5 billion (U.S.$219 million), declining by ¥36.9 billion (U.S.$376 million) from the year-ago period.

Cash Flow

During the first nine months of 2013, cash flow from operating activities totaled ¥343.3 billion (U.S.$3,503 million), an increase of ¥77.5 billion (U.S.$791 million) compared with the corresponding period of the previous year, owing to improvements in working capital through such means as increasing the collection of accounts receivable. Although capital investment focused on new products, cash flow from investing activities increased ¥52.6 billion (U.S.$536 million) year on year to ¥207.6 billion (U.S.$2,118 million) as a result of an increased amount of time deposits included in short-term investments. Accordingly, free cash flow totaled ¥135.7 billion (U.S.$1,385 million), an increase of ¥24.9 billion (U.S.$255 million) compared with the corresponding year-ago period. Cash flow from financing activities recorded an outlay of ¥212.1 billion (U.S.$2,164 million), mainly arising from the dividend payout and the repurchasing of treasury stock.

Owing to these factors, as well as the positive impact from foreign currency translation adjustments, cash and cash equivalents decreased by ¥26.2 billion (U.S.$267 million) to ¥640.5 billion (U.S.$6,536 million) from the end of the previous year.

 

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Outlook

As for the outlook in the fourth quarter of 2013, while the U.S. and Japanese economies continue to gradually recover, the global economy is expected to realize only moderate growth owing to the sluggish European economy and deceleration of emerging economies. In particular, the outlook for the year-end shopping season remains uncertain for business segments targeting individual consumers, which are susceptible to the effects of business conditions.

In the businesses in which Canon is involved, demand for MFDs is projected to expand moderately mainly for color models, while demand in the laser printer market is expected to surpass the previous year’s level. As for interchangeable-lens digital cameras, despite favorable growth in Japan owing to an improvement in business sentiment, overseas demand is expected to face challenges due to the sluggish economies of Europe and emerging countries. Within the digital compact camera, the market is projected to continue shrinking, mainly among low-end models, due to the popularity of smartphones. With regard to inkjet printers, demand is expected to continue to decline, primarily in Asian countries. In the industrial equipment market, an improvement in demand is expected to continue contributing to the recovery in investment by device manufacturers, boosting demand for semiconductor lithography equipment. Demand for FPD lithography equipment will likely pick up in line with the recovery in demand for large-size panels in addition to the healthy market for mid- and small-size panels.

With regard to currency exchange rates for the last quarter of 2013, on which Canon’s performance outlook is based, Canon assumes exchange rates of ¥97 to the U.S. dollar and ¥130 to the euro for the fourth quarter, and ¥96.65 to the U.S. dollar and ¥128.24 to the euro for the annual average, representing depreciations of approximately ¥17 against the U.S. dollar, and approximately ¥25 against the euro compared with the previous year.

Upon taking into consideration these foreign exchange rate assumptions and the current economic forecast, Canon projects full-year consolidated net sales in 2013 of ¥3,750.0 billion (U.S.$38,265 million), a year-on-year increase of 7.8%; operating profit of ¥360.0 billion (U.S.$3,673 million), a year-on-year increase of 11.2%; income before income taxes of ¥360.0 billion (U.S.$3,673 million), a year-on-year increase of 5.1%; and net income attributable to Canon Inc. of ¥240.0 billion (U.S.$2,449 million), a year-on-year increase of 6.9%.

Consolidated Outlook

Fiscal year		Millions of yen
		Year ending December 31, 2013								Change						Year ended December 31, 2012				Change (%)
		Previous Outlook (A)				Revised Outlook (B)				(B - A)						Results (C)				(B - C) / C
Net sales		¥	3,850,000			¥	3,750,000			¥	(100,000)					¥	3,479,788				+7.8%
Operating profit			380,000				360,000				(20,000)						323,856				+11.2%
Income before income taxes			390,000				360,000				(30,000)						342,557				+5.1%
Net income attributable to Canon Inc.		¥	260,000			¥	240,000			¥	(20,000)					¥	224,564				+6.9%

 

 

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

II. Financial Statements

1.    CONSOLIDATED BALANCE SHEETS

 

		Millions of yen												Thousands of U.S. dollars
		As of September 30, 2013				As of December 31, 2012				Change				As of September 30, 2013
ASSETS
Current assets:
Cash and cash equivalents		¥	640,521			¥	666,678			¥	(26,157)			$	6,535,929
Short-term investments			54,578				28,322				26,256				556,918
Trade receivables, net			519,893				573,375				(53,482)				5,305,031
Inventories			607,705				551,623				56,082				6,201,071
Prepaid expenses and other current assets			296,308				262,258				34,050				3,023,551
Total current assets			2,119,005				2,082,256				36,749				21,622,500
Noncurrent receivables			18,766				19,702				(936)				191,490
Investments			64,210				56,617				7,593				655,204
Property, plant and equipment, net			1,269,725				1,260,364				9,361				12,956,378
Intangible assets, net			139,343				135,736				3,607				1,421,867
Other assets			434,110				400,828				33,282				4,429,694
Total assets		¥	4,045,159			¥	3,955,503			¥	89,656			$	41,277,133
LIABILITIES AND EQUITY
Current liabilities:
Short-term loans and current portion of long-term debt		¥	1,975			¥	1,866			¥	109			$	20,153
Trade payables			321,281				325,235				(3,954)				3,278,378
Accrued income taxes			38,446				60,057				(21,611)				392,306
Accrued expenses			300,439				291,348				9,091				3,065,704
Other current liabilities			151,418				165,929				(14,511)				1,545,081
Total current liabilities			813,559				844,435				(30,876)				8,301,622
Long-term debt, excluding current installments			1,364				2,117				(753)				13,918
Accrued pension and severance cost			272,021				272,131				(110)				2,775,724
Other noncurrent liabilities			89,639				82,518				7,121				914,685
Total liabilities			1,176,583				1,201,201				(24,618)				12,005,949
Equity:
Canon Inc. stockholders’ equity:
Common stock			174,762				174,762				-				1,783,286
Additional paid-in capital			400,718				401,547				(829)				4,088,959
Legal reserve			62,485				61,663				822				637,602
Retained earnings			3,149,047				3,138,976				10,071				32,133,133
Accumulated other comprehensive income (loss)			(215,918)				(367,249)				151,331				(2,203,245)
Treasury stock, at cost			(861,652)				(811,673)				(49,979)				(8,792,368)
Total Canon Inc. stockholders’ equity			2,709,442				2,598,026				111,416				27,647,367
Noncontrolling interests			159,134				156,276				2,858				1,623,817
Total equity			2,868,576				2,754,302				114,274				29,271,184
Total liabilities and equity		¥	4,045,159			¥	3,955,503			¥	89,656			$	41,277,133
		Millions of yen												Thousands of U.S. dollars
		As of September 30, 2013				As of December 31, 2012								As of September 30, 2013
Notes:
1. Allowance for doubtful receivables		¥	13,185			¥	12,970							$	134,541
2. Accumulated depreciation			2,317,714				2,159,453								23,650,143
3. Accumulated other comprehensive income (loss):
Foreign currency translation adjustments			(106,624)				(247,734	)							(1,088,000	)
Net unrealized gains and losses on securities			7,414				4,146								75,653
Net gains and losses on derivative instruments			(24)				(4,462	)							(245	)
Pension liability adjustments			(116,684)				(119,199	)							(1,190,653	)

 

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

2.    CONSOLIDATED STATEMENTS OF INCOME AND CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Consolidated statements of income

 

Results for the third quarter		Millions of yen																Thousands of U.S. dollars
		Three months ended September 30, 2013				Three months ended September 30, 2012				Change(%)								Three months ended September 30, 2013
Net sales		¥	913,149			¥	799,949				+				14.2			$	9,317,847
Cost of sales			466,017				413,194												4,755,276
Gross profit			447,132				386,755				+				15.6				4,562,571
Operating expenses:
Selling, general and administrative expenses			279,124				243,403												2,848,203
Research and development expenses			77,398				72,475												789,776
			356,522				315,878												3,637,979
Operating profit			90,610				70,877				+				27.8				924,592
Other income (deductions):
Interest and dividend income			1,498				1,515												15,286
Interest expense			(106)				(138)												(1,082)
Other, net			(3,946)				2,926												(40,265)
			(2,554)				4,303												(26,061)
Income before income taxes			88,056				75,180				+				17.1				898,531
Income taxes			27,215				24,021												277,704
Consolidated net income			60,841				51,159												620,827
Less: Net income attributable to noncontrolling interests			2,019				1,020												20,603
Net income attributable to Canon Inc.		¥	58,822			¥	50,139				+				17.3			$	600,224
Results for the nine months		Millions of yen																Thousands of U.S. dollars
		Nine months ended September 30, 2013				Nine months ended September 30, 2012				Change(%)								Nine months ended September 30, 2013
Net sales		¥	2,696,682			¥	2,528,394				+				6.7			$	27,517,163
Cost of sales			1,386,279				1,310,820												14,145,704
Gross profit			1,310,403				1,217,574				+				7.6				13,371,459
Operating expenses:
Selling, general and administrative expenses			838,107				749,594												8,552,112
Research and development expenses			228,559				221,828												2,332,235
			1,066,666				971,422												10,884,347
Operating profit			243,737				246,152				-				1.0				2,487,112
Other income (deductions):
Interest and dividend income			4,239				5,089												43,255
Interest expense			(357)				(513)												(3,643)
Other, net			(440)				2,721												(4,489)
			3,442				7,297												35,123
Income before income taxes			247,179				253,449				-				2.5				2,522,235
Income taxes			75,985				85,524												775,357
Consolidated net income			171,194				167,925												1,746,878
Less: Net income attributable to noncontrolling interests			4,963				4,534												50,643
Net income attributable to Canon Inc.		¥	166,231			¥	163,391				+				1.7			$	1,696,235

 

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

Consolidated statements of comprehensive income

 

Results for the third quarter		Millions of yen																Thousands of U.S. dollars
		Three months ended September 30, 2013				Three months ended September 30, 2012				Change(%)								Three months ended September 30, 2013
Consolidated net income		¥	60,841			¥	51,159				+				18.9			$	620,827
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments			5,145				(1,734)												52,500
Net unrealized gains and losses on securities			1,757				(61)												17,929
Net gains and losses on derivative instruments			833				(654)												8,500
Pension liability adjustments			2,900				361												29,591
			10,635				(2,088)												108,520
Comprehensive income			71,476				49,071				+				45.7				729,347
Less: Comprehensive income attributable to noncontrolling interests			2,399				1,241												24,480
Comprehensive income attributable to Canon Inc.		¥	69,077			¥	47,830				+				44.4			$	704,867
Results for the nine months		Millions of yen																Thousands of U.S. dollars
		Nine  months ended September 30, 2013				Nine months ended September  30, 2012				Change(%)								Nine  months ended September 30, 2013
Consolidated net income		¥	171,194			¥	167,925				+				1.9			$	1,746,878
Other comprehensive income, net of tax
Foreign currency translation adjustments			142,279				6,632												1,451,827
Net unrealized gains and losses on securities			3,912				928												39,918
Net gains and losses on derivative instruments			4,440				243												45,306
Pension liability adjustments			2,819				949												28,765
			153,450				8,752												1,565,816
Comprehensive income			324,644				176,677				+				83.8				3,312,694
Less: Comprehensive income attributable to noncontrolling interests			6,796				4,777												69,347
Comprehensive income attributable to Canon Inc.		¥	317,848			¥	171,900				+				84.9			$	3,243,347

 

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

3.    DETAILS OF SALES

 

Notes: 1. The primary products included in each of the segments are as follows:

  2. The principal countries and regions included in each regional category are as follows:

 

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

4.    CONSOLIDATED STATEMENTS OF CASH FLOWS

 

 

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

5.    NOTE FOR GOING CONCERN ASSUMPTION

      Not applicable.

6.    SEGMENT INFORMATION

 

(1)  SEGMENT INFORMATION BY BUSINESS UNIT

 

 

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

 

 

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

(2)  SEGMENT INFORMATION BY GEOGRAPHIC AREA

 

 

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

 

 

 

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

7.    SIGNIFICANT CHANGES IN CANON INC. STOCKHOLDERS’ EQUITY

      None.

8.    BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

(1)  GROUP POSITION

 

1.

Number of Group Companies

 

		September 30, 2013				December 31, 2012				Change
Subsidiaries			263				275				(12	)
Affiliates			10				9				1
Total			273				284				(11	)

 

2.

Change in Group Entities

 

Subsidiaries
Addition:		18 companies
Removal:		30 companies

 

Affiliates(Carried at Equity Basis)
Addition:		1 company

 

3.

Subsidiaries Listed on Domestic Stock Exchange

Tokyo Stock Exchange (1st section): Canon Marketing Japan Inc., Canon Electronics Inc.

(2)  SIGNIFICANT ACCOUNTING POLICIES

Canon’s consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles.

 

-14-

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Canon Inc.

Oct. 24, 2013

CONSOLIDATED FINANCIAL RESULTS FOR THE THIRD QUARTER

AND NINE MONTHS ENDED SEPTEMBER 30, 2013

SUPPLEMENTARY REPORT

TABLE OF CONTENTS

 

				PAGE
1.		SALES BY GEOGRAPHIC AREA AND BUSINESS UNIT			S    1
2.		SEGMENT INFORMATION BY BUSINESS UNIT			S    2
3.		OTHER INCOME / DEDUCTIONS			S    2
4.		BREAKDOWN OF PRODUCT SALES WITHIN BUSINESS UNIT			S    3
5.		SALES GROWTH IN LOCAL CURRENCY (Year over year)			S    3
6.		PROFITABILITY			S    4
7.		IMPACT OF FOREIGN EXCHANGE RATES			S    4
8.		STATEMENTS OF CASH FLOWS			S    4
9.		R&D EXPENDITURE			S    5
10.		INCREASE IN PP&E & DEPRECIATION AND AMORTIZATION			S    5
11.		INVENTORIES			S    5
12.		DEBT RATIO			S    5
13.		OVERSEAS PRODUCTION RATIO			S    5
14.		NUMBER OF EMPLOYEES			S    5

 

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Canon Inc.

 

1. SALES BY GEOGRAPHIC AREA AND BUSINESS UNIT			(Millions of yen	)

				2013												2012														Change year over year
				3rd quarter				YTD				Year (P)				3rd quarter				YTD				Year						3rd quarter				YTD				Year
Japan
		Office			85,181				270,820				-				87,294				274,887				368,939						-2.4%				-1.5%			-
		Imaging System			52,183				139,867				-				46,678				139,062				213,465						+11.8%				+0.6%			-
		Industry and Others			30,604				92,653				-				31,787				107,534				137,882						-3.7%				-13.8%			-
		Total			167,968				503,340				717,300				165,759				521,483				720,286						+1.3%				-3.5%			-0.4%
Overseas
		Office			407,849				1,201,795				-				320,367				1,022,382				1,383,021						+27.3%				+17.5%			-
		Imaging System			296,240				892,316				-				275,110				855,040				1,190,929						+7.7%				+4.4%			-
		Industry and Others			41,092				99,231				-				38,713				129,489				185,552						+6.1%				-23.4%			-
		Total			745,181				2,193,342				3,032,700				634,190				2,006,911				2,759,502						+17.5%				+9.3%			+9.9%
		Americas
		Office			164,728				470,991				-				130,849				395,562				530,382						+25.9%				+19.1%			-
		Imaging System			85,563				274,180				-				79,239				246,505				366,888						+8.0%				+11.2%			-
		Industry and Others			7,386				26,590				-				9,905				31,454				42,603						-25.4%				-15.5%			-
		Total			257,677				771,761				1,057,600				219,993				673,521				939,873						+17.1%				+14.6%			+12.5%
		Europe
		Office			163,676				505,803				-				130,720				431,790				597,341						+25.2%				+17.1%			-
		Imaging System			92,779				282,099				-				86,489				278,090				394,612						+7.3%				+1.4%			-
		Industry and Others			6,498				17,360				-				4,531				15,249				22,085						+43.4%				+13.8%			-
		Total			262,953				805,262				1,132,400				221,740				725,129				1,014,038						+18.6%				+11.1%			+11.7%
		Asia and Oceania
		Office			79,445				225,001				-				58,798				195,030				255,298						+35.1%				+15.4%			-
		Imaging System			117,898				336,037				-				109,382				330,445				429,429						+7.8%				+1.7%			-
		Industry and Others			27,208				55,281				-				24,277				82,786				120,864						+12.1%				-33.2%			-
		Total			224,551				616,319				842,700				192,457				608,261				805,591						+16.7%				+1.3%			+4.6%
Intersegment
		Office			835				5,488				-				1,690				3,983				5,615						-50.6%				+37.8%			-
		Imaging System			214				574				-				298				1,194				1,577						-28.2%				-51.9%			-
		Industry and Others			23,378				64,205				-				22,442				64,049				84,406						+4.2%				+0.2%			-
		Eliminations			(24,427	)			(70,267	)			-				(24,430	)			(69,226	)			(91,598	)					-				-			-
		Total			0				0				0				0				0				0						-				-			-
Total
		Office			493,865				1,478,103				1,994,900				409,351				1,301,252				1,757,575						+20.6%				+13.6%			+13.5%
		Imaging System			348,637				1,032,757				1,465,000				322,086				995,296				1,405,971						+8.2%				+3.8%			+4.2%
		Industry and Others			95,074				256,089				383,000				92,942				301,072				407,840						+2.3%				-14.9%			-6.1%
		Eliminations			(24,427	)			(70,267	)			(92,900	)			(24,430	)			(69,226	)			(91,598	)					-				-			-
		Total			913,149				2,696,682				3,750,000				799,949				2,528,394				3,479,788						+14.2%				+6.7%			+7.8%

(P)=Projection

 

- S1 -

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Canon Inc.

 

2. SEGMENT INFORMATION BY BUSINESS UNIT

(Millions of yen)

				2013												2012														Change year over year
				3rd quarter				YTD				Year (P)				3rd quarter				YTD				Year						3rd quarter		YTD		Year
Office
		External customers			493,030				1,472,615				1,988,800				407,661				1,297,269				1,751,960					+20.9%		+13.5%		+13.5%
		Intersegment			835				5,488				6,100				1,690				3,983				5,615					-50.6%		+37.8%		+8.6%
		Total sales			493,865				1,478,103				1,994,900				409,351				1,301,252				1,757,575					+20.6%		+13.6%		+13.5%
		Operating profit			67,094				203,357				272,300				41,148				152,306				203,578					+63.1%		+33.5%		+33.8%
		% of sales			13.6%				13.8%				13.6%				10.1%				11.7%				11.6%					-		-		-
Imaging System
		External customers			348,423				1,032,183				1,464,100				321,788				994,102				1,404,394					+8.3%		+3.8%		+4.3%
		Intersegment			214				574				900				298				1,194				1,577					-28.2%		-51.9%		-42.9%
		Total sales			348,637				1,032,757				1,465,000				322,086				995,296				1,405,971					+8.2%		+3.8%		+4.2%
		Operating profit			56,939				141,698				211,800				52,608				155,355				210,318					+8.2%		-8.8%		+0.7%
		% of sales			16.3%				13.7%				14.5%				16.3%				15.6%				15.0%					-		-		-
Industry and Others
		External customers			71,696				191,884				297,100				70,500				237,023				323,434					+1.7%		-19.0%		-8.1%
		Intersegment			23,378				64,205				85,900				22,442				64,049				84,406					+4.2%		+0.2%		+1.8%
		Total sales			95,074				256,089				383,000				92,942				301,072				407,840					+2.3%		-14.9%		-6.1%
		Operating profit			(8,138	)			(21,504	)			(19,000	)			5,035				15,360				5,910					-		-		-
		% of sales			-8.6%				-8.4%				-5.0%				5.4%				5.1%				1.4%					-		-		-
Corporate and Eliminations
		External customers			-				-				-				-				-				-					-		-		-
		Intersegment			(24,427	)			(70,267	)			(92,900	)			(24,430	)			(69,226	)			(91,598	)				-		-		-
		Total sales			(24,427	)			(70,267	)			(92,900	)			(24,430	)			(69,226	)			(91,598	)				-		-		-
		Operating profit			(25,285	)			(79,814	)			(105,100	)			(27,914	)			(76,869	)			(95,950	)				-		-		-
Consolidated
		External customers			913,149				2,696,682				3,750,000				799,949				2,528,394				3,479,788					+14.2%		+6.7%		+7.8%
		Intersegment			-				-				-				-				-				-					-		-		-
		Total sales			913,149				2,696,682				3,750,000				799,949				2,528,394				3,479,788					+14.2%		+6.7%		+7.8%
		Operating profit			90,610				243,737				360,000				70,877				246,152				323,856					+27.8%		-1.0%		+11.2%
		% of sales			9.9%				9.0%				9.6%				8.9%				9.7%				9.3%					-		-		-
																																(P)=Projection
3. OTHER INCOME / DEDUCTIONS																														(Millions of yen)
				2013												2012														Change year over year
				3rd quarter				YTD				Year (P)				3rd quarter				YTD				Year						3rd quarter		YTD		Year
		Interest and dividend, net			1,392				3,882				5,100				1,377				4,576				5,770					+15		(694)		(670)
		Forex gain (loss)			(3,939	)			(6,083	)			(10,000	)			1,986				(1,347	)			9,130					(5,925)		(4,736)		(19,130)
		Equity earnings (loss) of affiliated companies			(481	)			(356	)			(200	)			247				674				610					(728)		(1,030)		(810)
		Other, net			474				5,999				5,100				693				3,394				3,191					(219)		+2,605		+1,909
		Total			(2,554	)			3,442				0				4,303				7,297				18,701					(6,857)		(3,855)		(18,701)
																																(P)=Projection

 

- S2 -

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Canon Inc.

 

4. BREAKDOWN OF PRODUCT SALES WITHIN BUSINESS UNIT
				2013						2012
				3rd quarter		YTD		Year (P)		3rd quarter		YTD		Year
Office
		Monochrome copiers		16%		16%		16%		16%		16%		16%
		Color copiers		18%		19%		19%		19%		19%		19%
		Printers		44%		44%		42%		44%		44%		44%
		Others		22%		21%		23%		21%		21%		21%
Imaging System
		Cameras		68%		68%		68%		71%		71%		70%
		Inkjet printers		24%		24%		25%		22%		21%		22%
		Others		8%		8%		7%		7%		8%		8%
Industry and Others
		Lithography equipment		9%		10%		18%		14%		18%		15%
		Others		91%		90%		82%		86%		82%		85%
														(P)=Projection
5. SALES GROWTH IN LOCAL CURRENCY (Year over year)
				2013
				3rd quarter		YTD		Year (P)
Office
		Japan		-2.4%		-1.5%		-
		Overseas		-0.1%		-4.3%		-
		Total		-0.8%		-3.6%		-3.2%
Imaging System
		Japan		+11.8%		+0.6%		-
		Overseas		-16.0%		-15.3%		-
		Total		-12.0%		-13.1%		-11.9%
Industry and Others
		Japan		-3.7%		-13.8%		-
		Overseas		-4.0%		-31.0%		-
		Total		-1.9%		-18.2%		-9.6%
Total
		Japan		+1.3%		-3.5%		-0.4%
		Overseas		-7.3%		-10.7%		-9.5%
		Americas		-7.1%		-6.2%		-7.4%
		Europe		-10.0%		-10.9%		-9.9%
		Asia and Oceania		-4.3%		-15.5%		-11.4%
		Total		-5.5%		-9.2%		-7.6%
								(P)=Projection

 

- S3 -

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Canon Inc.

6. PROFITABILITY

				2013								2012
				YTD				Year (P)				YTD				Year
ROE *1					8.4%				8.9%				8.8%				8.7%
ROA *2					5.5%				5.9%				5.7%				5.7%
																	(P)=Projection
*1 Return on Equity; Based on Net Income attributable to Canon Inc. and Total Canon Inc. Stockholders’ Equity *2 Return on Assets; Based on Net Income attributable to Canon Inc.   7. IMPACT OF FOREIGN EXCHANGE RATES
(1) Exchange rates																				(Yen)
				2013												2012
				3rd quarter				4th quarter (P)				Year (P)				3rd quarter				Year
		Yen/US$			98.91				97.00				96.95				78.58			79.96
		Yen/Euro			131.09				130.00				128.24				98.48			102.80
																				(P)=Projection
(2) Impact of foreign exchange rates on sales (Year over year)								(Billions of yen)
				2013
				3rd quarter				Year (P)
		US$			+68.3				+240.1
		Euro			+52.7				+171.6
		Other currencies			+20.3				+77.0
		Total			+141.3				+488.7
					(P)=Projection
(3) Impact of foreign exchange rates per yen				(Billions of yen)
				2013
				4th quarter (P)
On sales
		US$			4.7
		Euro			2.1
On operating profit
		US$			1.8
		Euro			1.2
					(P)=Projection
8. STATEMENTS OF CASH FLOWS													(Millions of yen)
				2013								2012
				3rd quarter				Year (P)				3rd quarter				Year
Net cash provided by operating activities					125,437				515,000				63,848				384,077
Net cash used in investing activities					(68,343	)			(300,000	)			(43,256	)			(212,740	)
Free cash flow					57,094				215,000				20,592				171,337
Net cash used in financing activities					(126,713	)			(210,000	)			(125,569	)			(319,739	)
Effect of exchange rate changes on cash and cash equivalents					2,366				38,300				(1,460	)			41,853
Net change in cash and cash equivalents					(67,253	)			43,300				(106,437	)			(106,549	)
Cash and cash equivalents at end of period					640,521				710,000				567,610				666,678
																	(P)=Projection

 

- S4 -

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Canon Inc.

 

9. R&D EXPENDITURE										(Millions of yen)
				2013				2012
				3rd quarter		Year (P)		3rd quarter		Year
		Office		26,117		-		24,854		99,484
		Imaging System		20,638		-		19,471		83,948
		Industry and Others		6,703		-		6,122		25,635
		Corporate and Eliminations		23,940		-		22,028		87,397
		Total		77,398		300,000		72,475		296,464
		% of sales		8.5%		8.0%		9.1%		8.5%
										(P)=Projection
10. INCREASE IN PP&E & DEPRECIATION AND AMORTIZATION										(Millions of yen)
				2013				2012
				3rd quarter		Year (P)		3rd quarter		Year
		Increase in PP&E		47,076		230,000		57,339		270,457
		Depreciation and amortization		69,399		255,000		64,322		258,133
										(P)=Projection
11. INVENTORIES
(1) Inventories								(Millions of yen)
				2013		2012		Difference
				Sep.30		Dec.31
		Office		226,946		201,661		+25,285
		Imaging System		254,270		245,973		+8,297
		Industry and Others		126,489		103,989		+22,500
		Total		607,705		551,623		+56,082
(2) Inventories/Sales*								(Days)
				2013		2012		Difference
				Sep.30		Dec.31
		Office		41		43		(2)
		Imaging System		63		61		+2
		Industry and Others		176		124		+52
		Total		59		57		+2
*Index based on the previous six months sales.
12. DEBT RATIO
				2013		2012		Difference
				Sep.30		Dec.31
		Total debt / Total assets		0.1%		0.1%		0.0%
13. OVERSEAS PRODUCTION RATIO
				2013		2012
				YTD		Year
		Overseas production ratio		58%		52%
14. NUMBER OF EMPLOYEES
				2013		2012		Difference
				Sep.30		Dec.31
		Japan		70,162		70,234		(72)
		Overseas		127,509		126,734		+775
		Total		197,671		196,968		+703

 

- S5 -