*NEWS*CANON Q1 PROFIT DOWN 18%

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*NEWS*CANON Q1 PROFIT DOWN 18%

 user 2008-04-25 at 3:42:44 pm Views: 54
  • #19706
    Canon Q1 profit down 18 pct
    APR2008TOKYO:
    Japanese camera and office equipment maker Canon Inc posted an 18 per
    cent fall in quarterly operating profit on Thursday, hit by a firmer
    yen, and lowered its full-year outlook closer to market
    expectations.Although Canon saw healthy demand for its digital cameras,
    the yen’s appreciation hurt its overall profitability. The company
    earns more than three-quarters of its group revenues overseas, but the
    value of those earnings falls when converted back into a stronger
    Japanese currency.

    Sluggish copier demand in the United States
    also hit Canon, which competes with Xerox Corp, Ricoh Co Ltd and Konica
    Minolta Holdings Inc in printers and copiers. Canon cut its operating
    profit forecast by 4 per cent to 770 billion yen ($7.44 billion) for
    the year to December, compared with a consensus of a 753.57 billion yen
    profit in a poll of 18 analysts.”I think the impact on the firm’s share
    price will be relatively limited since the stock has already fallen to
    a discounted level,” said Shigemi Nonaka, special adviser to Polestar
    Investment Management Co. The lowered forecast still tops a 756.67
    billion yen profit in 2007, when the Tokyo-based company posted its
    eighth straight year of profit growth.”The economy is expected to stage
    a gradual recovery towards the end of the year and demand from emerging
    markets is likely to remain strong,” Canon Managing Director Masahiro
    Osawa said. “I think we can overcome harder-than-usual business
    conditions and achieve sales and profit growth for the ninth
    year.”Canon, which offers IXY compact digital cameras and EOS high-end
    models, is the world’s largest digital camera maker ahead of Sony Corp,
    Olympus Corp and Nikon Corp. In January-March, Canon’s operating profit
    was 170.83 billion yen, down from a 207.4 billion yen profit a year
    earlier and roughly in line with analysts’ consensus of a 171.1 billion
    yen profit.Net profit fell 18.7 per cent from a year earlier to 106.64
    billion yen on sales of 1.0075 trillion yen, down 3.1 per cent. Rival
    Ricoh also posted a slide in quarterly profit on Thursday. Its
    operating profit fell 10 per cent from a year earlier to 47.4 billion
    yen in January-March, due to the yen’s appreciation against the dollar
    and slower multifunctional printer sales in the United
    States.Multifunctional printers typically offer printer, copier,
    facsimile and scanner functions. For the year ending March 2009, it
    expects operating profit to dip 1 per cent to 180 billion yen, falling
    short of a market consensus of 190.4 billion yen.