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 user 2009-03-25 at 3:20:40 pm Views: 59
  • #21886
    Canon cuts 2010 profit outlook by 75%
    Japanese electronics maker Canon Inc. lowered its profit outlook for 2010 by 75% to figures more in line with the economic downturn as the company grapples with the impact of a stronger yen and weak demand on its operations, according to media reports Thursday.

    Accordingly, for 2010, Canon now forecasts net income of 150 billion yen, down sharply from its prior outlook for net income of 600 billion yen set in 2007. The company also lowered its outlook for revenues for the year to 3.7 trillion yen from the prior forecast of 6 trillion yen.Canon had recorded profits for eight consecutive years through fiscal 2007 on stronger demand for copiers, digital cameras and other products. However, the company has since witnessed a sharp fall in demand for its cameras and copiers as the global economic crisis hit its major export markets.

    Concurrent recession in Japan, America and Europe, along with the rapid slowdown in the growth rates of emerging economies has impacted the company’s results. The compact digital camera and inkjet printer markets are expected to remain stagnant owing to weak buyer sentiment amid the depressed economic environment.

    However, Canon has managed to stay relatively unscathed amid the economic turmoil that has caused several companies to revise their forecasts to a net loss from their earlier forecasts for a profit.Canon’s revised outlook for 2010 still represents an increase from the company’s forecast for 2009. Canon currently forecasts net income for 2009 of 98 billion yen, or US$1.08 billion, and revenue of 3.5 trillion yen, or US$38.46 billion.

    In January, Canon reported a sharp fall in its profit for the fourth quarter from the year-ago period as sales declined more than 20%. The company’s fourth-quarter net income was 11.62 billion yen, or US$127.71 million, 90.9% lower than 127.85 billion yen in the same period last year. Net sales declined 21.3% to 994.74 billion yen, or US$10.93 billion, from 1.26 trillion yen in the prior-year quarter.In Thursday’s regular trading on the NYSE, CAJ is trading at $23.78, up $0.29 or 1.23% on a volume of 0.18 million share