Canon Inc 6-K, filed Oct 26, 2020
Canon Inc (CAJPY)
About this 6-K
Canon Inc filed this 6-K on October 26, 2020.
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 |
……………………………………………… , | 2020 |
| 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-....................
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. |
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| (Registrant) | ||||||||||
| Date…. |
October 26, 2020 | By...../s/………Sachiho Tanino……………… | ||||||||
| (Signature)* | ||||||||||
| Sachiho Tanino | ||||||||||
| General Manager | ||||||||||
| Consolidated Accounting Div. | ||||||||||
| Canon Inc. | ||||||||||
*Print the name and title of the signing officer under his signature.
The following materials are included.
1. RESULTS FOR THE THIRD QUARTER AND THE NINE MONTHS ENDED SEPTEMBER 30, 2020
CONSOLIDATED RESULTS FOR THE THIRD QUARTER AND
THE NINE MONTHS ENDED SEPTEMBER 30, 2020
October 26, 2020
CONSOLIDATED RESULTS FOR THE THIRD QUARTER
(Millions of yen, thousands of U.S. dollars, except per share amounts)
| Actual | ||||||||||||||||||||||||||||||||
| Three months ended September 30, 2020 |
Three months ended September 30, 2019 |
Change(%)
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Three months ended September 30, 2020 |
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| Net sales |
¥ | 758,881 | ¥ | 869,495 | - | 12.7 | $ | 7,159,255 | ||||||||||||||||||||||||
| Operating profit |
19,192 | 38,445 | - | 50.1 | 181,057 | |||||||||||||||||||||||||||
| Income before income taxes |
22,808 | 47,024 | - | 51.5 | 215,170 | |||||||||||||||||||||||||||
| Net income attributable to Canon Inc. |
¥ | 16,658 | ¥ | 26,522 | - | 37.2 | $ | 157,151 | ||||||||||||||||||||||||
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Net income attributable to Canon Inc. shareholders per share: |
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| - Basic |
¥ | 15.93 | ¥ | 24.93 | - | 36.1 | $ | 0.15 | ||||||||||||||||||||||||
| - Diluted |
15.93 | 24.93 | - | 36.1 | 0.15 | |||||||||||||||||||||||||||
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CONSOLIDATED RESULTS FOR THE NINE MONTHS
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| (Millions of yen, thousands of U.S. dollars, except per share amounts)
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| Actual | Projection | |||||||||||||||||||||||||||||||
| Nine months ended September 30, 2020 |
Nine months ended September 30, 2019 |
Change(%)
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Nine months ended September 30, 2020 |
Year ending December 31, 2020 |
Change(%)
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| Net sales |
¥ | 2,214,508 | ¥ | 2,639,830 | - | 16.1 | $ | 20,891,585 | ¥ | 3,140,000 | - | 12.6 | ||||||||||||||||||||
| Operating profit |
34,314 | 121,998 | - | 71.9 | 323,717 | 64,000 | - | 63.4 | ||||||||||||||||||||||||
| Income before income taxes |
50,096 | 144,212 | - | 65.3 | 472,604 | 86,000 | - | 56.1 | ||||||||||||||||||||||||
| Net income attributable to Canon Inc. |
¥ | 29,729 | ¥ | 92,349 | - | 67.8 | $ | 280,462 | ¥ | 52,000 | - | 58.4 | ||||||||||||||||||||
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Net income attributable to Canon Inc. shareholders per share: |
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| - Basic |
¥ | 28.29 | ¥ | 86.16 | - | 67.2 | $ | 0.27 | ¥ | 49.53 | - | 57.6 | ||||||||||||||||||||
| - Diluted |
28.28 | 86.15 | - | 67.2 | 0.27 | 49.52 | - | 57.6 | ||||||||||||||||||||||||
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| Actual | ||||||||||||||||||||||||||||||||
| As of September 30, 2020 |
As of December 31, 2019 |
Change(%)
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As of September 30, 2020 |
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| Total assets |
¥ | 4,701,606 | ¥ | 4,768,351 | - | 1.4 | $ | 44,354,774 | ||||||||||||||||||||||||
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| Canon Inc. shareholders’ equity |
¥ | 2,500,212 | ¥ | 2,692,595 | - | 7.1 | $ | 23,586,906 | ||||||||||||||||||||||||
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| 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 JPY106=U.S.$1, the approximate exchange rate on the Tokyo Foreign Exchange Market as of September 30, 2020, 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 |
-1-
I. Operating Results and Financial Conditions
2020 Third Quarter in Review
Looking back at the global economy in the third quarter of 2020, the global economy improved after a sharp decline in the second quarter as a result of gradual resumption of economic activities in the global coronavirus (“COVID-19”) pandemic. In the U.S., despite continued restrictions on economic activities in some states, increased consumer spending and exports accelerated the economic recovery. The European economy trended positively due to a recovery in consumption resulting from the easing of lockdowns in each country. In China, the recovery trend continued mainly in domestic demand and exports after the resumption of economic activities. Even in other emerging markets, although the spread of COVID-19 continued, with the exception of some emerging countries, the economy headed toward a recovery phase. In Japan, the economy showed signs of recovery mainly due to the resumption of economic activities and the easing of voluntary activity restrictions.
Amid these conditions, in the markets in which Canon operates, as for office multifunction devices (MFDs) and laser printers, demand for both monochrome and color models declined due to insufficient recovery of corporate activities. For cameras, although the market continued to shrink, demand headed toward a recovery phase due to a recovery in consumption. For inkjet printers, the pace of recovery gradually increased in emerging countries, in addition to developed countries and China, where demand for remote working and education was solid. For medical equipment, although restrictions on sales activities to medical institutions were eased, sales activities were affected by the prolonged impact of COVID-19. For industrial equipment, although the market recovery for FPD (Flat Panel Display) lithography equipment was slower than expected due to delays in installation, demand for semiconductor lithography equipment remained solid.
The average values of the yen during the third quarter and the first nine months of the year were ¥ 106.17 and ¥ 107.59 against the U.S. dollar, respectively, a year-on-year appreciation of approximately ¥ 1 and year-on-year appreciation of approximately ¥ 2, and ¥ 124.13 and ¥ 121.02 against the euro, respectively, a year-on-year depreciation of approximately ¥ 5 and year-on-year appreciation of approximately ¥ 2.
During the third quarter, sales of MFDs for the office and production printing market both decreased, although they showed signs of recovery. Unit sales of laser printers, particularly of color models, were below those of the same period of the previous year. Sales of services and consumables also declined due to a moderate recovery in customers’ print volumes after the resumption of corporate activities. For interchangeable-lens digital cameras, although unit sales were below those of the same period of the previous year, Canon attracted home image capturing demand of families staying longer hours indoors. As for inkjet printers, unit sales were significantly above those of the same period of the previous year due to the recovery in demand in some emerging countries on top of demand for remote working and education in developed countries and China. In medical equipment, although equipment installation at medical institutions as well as business negotiations were trending toward recovery, sales were below those of the same period of the previous year due to the prolonged impact of COVID-19, and the demand ahead of the consumption tax hike in Japan which occurred during the same period of the previous year. For industrial equipment, despite solid demand for semiconductor lithography equipment for memory devices, sales for FPD lithography equipment and organic LED (OLED) panels manufacturing equipment decreased compared with those of the same period of the previous year as a result of postponement of installation due to the impact of COVID-19. As for network cameras, which are being used in a growing range of applications and where the market continued to grow, sales increased thanks to resumed sales and marketing activities. Under these conditions, third-quarter net sales decreased by 12.7% year-on-year to ¥758.9 billion. Net sales for the first nine months of the year decreased by 16.1% year on year to ¥2,214.5 billion. Gross profit as a percentage of net sales decreased by 1.6 points to 43.2%. Third-quarter gross profit decreased by 16.0% year-on-year to ¥327.6 billion. Operating expenses decreased by 12.2% year-on-year to ¥308.4 billion, due to the further promotion of efficiency for expenses throughout the entire Group, despite negative effects of foreign currency fluctuation. As a result, third-quarter operating profit decreased by 50.1% to ¥19.2 billion. Other income (deductions) decreased by ¥5.0 billion to ¥3.6 billion, mainly due to currency exchange losses compared with the previous year, while income before income taxes decreased by 51.5% year on year to ¥22.8 billion and net income attributable to Canon Inc. decreased by 37.2% year on year to ¥16.7 billion. Operating profit for the first nine months of the year decreased by 71.9% to ¥34.3 billion, while income before income taxes decreased by 65.3% to ¥50.1 billion and net income attributable to Canon Inc. for the first nine months decreased by 67.8% to ¥29.7 billion.
Basic net income attributable to Canon Inc. shareholders per share was ¥15.93 for the third quarter, a year-on-year decrease of ¥9.00, and ¥28.29 for the first nine months, a year-on-year decrease of ¥57.87.
-2-
Results by Segment
Looking at Canon’s third-quarter performance by business unit, in the Office Business Unit, although sales of the new imageRUNNER ADVANCE DX series were strong, unit sales of MFDs for the office and the production printing market were below those of the same period of the previous year due to such factors as the moderate recovery in business negotiations following the resumption of in-office work. As for laser printers, unit sales, particularly of color models, were below those of the same period of the previous year as a result of continued economic slowdown caused by COVID-19. Sales of services and consumables also declined due to a moderate recovery in customers’ print volumes after the resumption of corporate activities. These factors resulted in total sales for the business unit of ¥335.9 billion, a year-on-year decrease of 21.0%, while income before income taxes decreased by 90.1% year-on-year to ¥4.1 billion. Sales for the combined first nine months of the year totaled ¥1,041.0 billion, a year-on-year decrease of 20.2%, while income before income taxes totaled ¥52.1 billion, a year-on-year decrease of 59.7%.
As for the Imaging System Business Unit, although unit sales were below those of the same period of the previous year as the market continues to shrink, the shift to mirrorless model was accelerated particularly for full-frame mirrorless models due to the introduction of new product. As for inkjet printers, sales of printers and consumables increased significantly from the same period of the previous year as a result of recovering demand in some emerging countries as well as the demand for remote working and education in developed countries and China. These factors resulted in total sales for the business unit of ¥185.4 billion, a year-on-year decrease of 2.0%, while income before income taxes increased by 158.5% year-on-year to ¥26.9 billion thanks to improvements in profitability. Sales for the combined first nine months of the year totaled ¥478.8 billion, a year-on-year decrease of 16.0%, while income before income taxes totaled ¥28.6 billion, a year-on-year decrease of 0.5%.
Within the Medical System Business Unit, demand was captured for Computed tomography (CT) systems for the diagnosis of pneumonia and Diagnostic X-ray systems, supported by a gradual recovery of equipment installation at medical institutions as well as sales and marketing activities. While sales of the same period of the previous year increased due to the demand ahead of the consumption tax hike in Japan, these factors resulted in total sales for the business unit of ¥105.4 billion, a year-on-year decrease of 7.5%, while income before income taxes decreased by 47.6% year-on-year to ¥5.0 billion. Sales for the combined first nine months of the year totaled ¥313.3 billion, a year-on-year decrease of 4.6%, while income before income taxes totaled ¥15.1 billion, a year-on-year decrease of 22.4%.
As for the Industry & Others Business Unit, regarding semiconductor lithography equipment, demand for memory devices remained solid. As a result, unit sales were significantly above those of the same period of the previous year. In FPD lithography equipment, although the resumption of installation work after COVID-19 travel restrictions were gradually eased, unit sales were below those of the same period of the previous year. Sales for network cameras increased as a result of strengthened sales activities based on diversified applications made possible by video analysis for such purposes as remote monitoring and social distance monitoring, as well as conventional market needs including crime prevention and disaster monitoring tools. These factors resulted in total sales for the business unit of ¥153.3 billion, a year-on-year decrease of 6.9%, while income before income taxes totaled ¥4.3 billion, a year-on-year increase of 49.7% due to cost reduction. Sales for the combined first nine months of the year totaled ¥439.7 billion, a year-on-year decrease of 13.3%, while income before income taxes totaled ¥6.1 billion, a year-on-year decrease of 66.0%.
-3-
Cash Flow
During the first nine months of 2020, cash flow from operating activities decreased by ¥0.4 billion year-on-year to ¥194.1 billion due to working capital improvement, despite a sharp decrease in profit. Cash flow used in investing activities was restrained by ¥46.1 billion year-on-year to ¥111.7 billion mainly due to a decrease of investment in production equipment. Accordingly, free cash flow totaled positive ¥82.4 billion, an increase of ¥45.7 billion compared with the corresponding year-ago period.
Cash flow from financing activities recorded an outlay mainly arising from dividend payments and share repurchases. However, proceeds of ¥6.9 billion in total were recorded mainly due to an increase in short-term loans for securing sufficient working capital.
Owing to these factors, as well as the impact from foreign currency translation adjustments, cash and cash equivalents increased by ¥87.5 billion to ¥500.3 billion from the end of the previous year.
Outlook
Looking at the world economy for the fourth quarter onwards, although various economic measures and fiscal policies are being implemented in each country and region, prospects remain uncertain. While the spread of COVID-19 is expected to continue, the pace of the world economy is expected to recover moderately with the balanced measures to curb infection and expand economic activities. However, it is expected to take time to control the spread of infections and see a full-scale recovery in global economic activities.
In the markets in which Canon operates, for office MFDs and laser printers, although a moderate recovery is assumed, demand is expected to remain below that of the previous year due to the impact of economic slowdown. As for interchangeable-lens digital cameras, although the overall market is expected to continue to shrink, sales promotion efforts are expected to be intensified for Canon’s extensive lineup of full-frame mirrorless cameras and lenses, including the new EOS R5 and EOS R6. As for inkjet printers, demand is expected to remain solid due to remote working and education needs. As for the medical equipment market, only a gradual recovery in demand is expected due to the resumption of medical device purchases by medical institutions despite the prolonged impact of COVID-19. For semiconductor lithography equipment, while demand for memory devices is expected to remain firm, demand for image sensors and automotive devices is expected to remain moderate. For FPD lithography equipment, a gradual rise in capital investment in small- and medium-size panels is expected. As for network cameras, the market is expected to head toward expansion due to increasing demand for high-resolution cameras and the video analysis solutions that make use of them.
With regard to currency exchange rates for the fourth quarter onwards, on which Canon’s performance outlook is based, Canon anticipates exchange rates of ¥105 to the U.S. dollar and ¥125 to the euro, representing appreciation of approximately ¥2 against the U.S. dollar and the same level against the euro as the annual average rates of the previous year.
Taking into consideration exchange rate assumptions, Canon’s first nine months performance, as well as current market conditions and sales prospects of new product, Canon’s 2020 full-year projection on a consolidated basis are net sales of ¥3,140.0 billion, a year-on-year decrease of 12.6%; operating profit of ¥64.0 billion, a year-on-year decrease of 63.4%; income before income taxes of ¥86.0 billion, a year-on-year decrease of 56.1%; and net income attributable to Canon Inc. of ¥52.0 billion, a year-on-year decrease of 58.4%, which were revised from the previous outlook.
-4-
Consolidated Outlook
| Fiscal year | Millions of yen | |||||||||||||||||||
| Year ending December 31, 2020 |
Change | Year ended December 31, 2019 |
Change (%) | |||||||||||||||||
| Previous Outlook (A) | Revised Outlook (B) | (B - A) | Results (C) | (B - C) / C | ||||||||||||||||
| Net sales |
3,080,000 | 3,140,000 | 60,000 | 3,593,299 | -12.6% | |||||||||||||||
| Operating profit |
45,000 | 64,000 | 19,000 | 174,667 | -63.4% | |||||||||||||||
| Income before income taxes |
70,000 | 86,000 | 16,000 | 195,740 | -56.1% | |||||||||||||||
| Net income attributable to Canon Inc. |
43,000 | 52,000 | 9,000 | 125,105 | -58.4% | |||||||||||||||
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This document 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 assumptions formed by available information. All statements other than statements of historical fact are statements that could be considered forward-looking statements. When used in this document, words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “project” or “should” and similar expressions, as they relate to Canon, are intended to identify forward-looking statements. Many factors could cause the actual results, performance or achievements of Canon to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in general economic and business conditions, changes in currency exchange rates and interest rates, introduction of competing products by other companies, lack of acceptance of new products or services by Canon’s targeted customers, inability to meet efficiency and cost reduction objectives, changes in business strategy and various other factors, both referenced and not referenced in this document. A detailed description of these and other risk factors is included in Canon’s annual report on Form 20-F, which is on file with the United States Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein. Canon does not intend or assume any obligation to update these forward-looking statements.
-5-
CANON INC. AND SUBSIDIARIES
CONSOLIDATED
II. Financial Statements
1. CONSOLIDATED BALANCE SHEETS
| Millions of yen | ||||||||||||
| As of September 30, 2020 |
As of December 31, 2019 |
Change | ||||||||||
| ASSETS |
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| Current assets: |
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| Cash and cash equivalents |
500,287 | 412,814 | 87,473 | |||||||||
| Short-term investments |
89 | 1,767 | (1,678) | |||||||||
| Trade receivables, net |
448,496 | 559,836 | (111,340) | |||||||||
| Inventories |
617,610 | 584,756 | 32,854 | |||||||||
| Prepaid expenses and other current assets |
294,016 | 286,792 | 7,224 | |||||||||
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| Total current assets |
1,860,498 | 1,845,965 | 14,533 | |||||||||
| Noncurrent receivables |
17,026 | 17,135 | (109) | |||||||||
| Investments |
48,791 | 48,361 | 430 | |||||||||
| Property, plant and equipment, net |
1,053,211 | 1,089,671 | (36,460) | |||||||||
| Operating lease right-of-use assets |
104,541 | 114,418 | (9,877) | |||||||||
| Intangible assets, net |
324,458 | 347,921 | (23,463) | |||||||||
| Goodwill |
897,670 | 898,661 | (991) | |||||||||
| Other assets |
395,411 | 406,219 | (10,808) | |||||||||
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| Total assets |
4,701,606 | 4,768,351 | (66,745) | |||||||||
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| LIABILITIES AND EQUITY |
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| Current liabilities: |
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| Short-term loans and current portion of long-term debt |
227,760 | 42,034 | 185,726 | |||||||||
| Trade payables |
284,388 | 305,312 | (20,924) | |||||||||
| Accrued income taxes |
11,048 | 18,801 | (7,753) | |||||||||
| Accrued expenses |
315,056 | 324,891 | (9,835) | |||||||||
| Current operating lease liabilities |
30,501 | 31,884 | (1,383) | |||||||||
| Other current liabilities |
236,737 | 237,576 | (839) | |||||||||
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| Total current liabilities |
1,105,490 | 960,498 | 144,992 | |||||||||
| Long-term debt, excluding current installments |
358,846 | 357,340 | 1,506 | |||||||||
| Accrued pension and severance cost |
364,301 | 368,507 | (4,206) | |||||||||
| Noncurrent operating lease liabilities |
75,624 | 83,688 | (8,064) | |||||||||
| Other noncurrent liabilities |
92,440 | 106,400 | (13,960) | |||||||||
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| Total liabilities |
1,996,701 | 1,876,433 | 120,268 | |||||||||
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| Equity: |
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| Canon Inc. shareholders’ equity: |
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| Common stock |
174,762 | 174,762 | - | |||||||||
| Additional paid-in capital |
404,633 | 405,017 | (384) | |||||||||
| Legal reserve |
69,407 | 67,572 | 1,835 | |||||||||
| Retained earnings |
3,362,909 | 3,462,182 | (99,273) | |||||||||
| Accumulated other comprehensive income (loss) |
(353,147) | (308,442) | (44,705) | |||||||||
| Treasury stock, at cost |
(1,158,352) | (1,108,496) | (49,856) | |||||||||
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| Total Canon Inc. shareholders’ equity |
2,500,212 | 2,692,595 | (192,383) | |||||||||
| Noncontrolling interests |
204,693 | 199,323 | 5,370 | |||||||||
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| Total equity |
2,704,905 | 2,891,918 | (187,013) | |||||||||
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| Total liabilities and equity |
4,701,606 | 4,768,351 | (66,745) | |||||||||
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| Millions of yen | ||||||||||||
| As of September 30, 2020 |
As of December 31, 2019 |
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| Notes: |
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| 1. Allowance for doubtful receivables |
11,803 | 10,359 | ||||||||||
| 2. Accumulated depreciation |
2,767,530 | 2,727,189 | ||||||||||
| 3. Accumulated other comprehensive income (loss): |
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| Foreign currency translation adjustments |
(132,678) | (96,282) | ||||||||||
| Net gains and losses on derivative instruments |
(307) | (887) | ||||||||||
| Pension liability adjustments |
(220,162) | (211,273) | ||||||||||
-6-
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 | |||||||||||||
| Three months ended September 30, 2020 |
Three months ended September 30, 2019 |
Change(%)
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| Net sales |
758,881 | 869,495 | - | 12.7 | ||||||||||
| Cost of sales |
431,305 | 479,619 | ||||||||||||
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| Gross profit |
327,576 | 389,876 | - | 16.0 | ||||||||||
| Operating expenses: |
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| Selling, general and administrative expenses |
240,313 | 277,624 | ||||||||||||
| Research and development expenses |
68,071 | 73,807 | ||||||||||||
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| 308,384 | 351,431 | |||||||||||||
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| Operating profit |
19,192 | 38,445 | - | 50.1 | ||||||||||
| Other income (deductions): |
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| Interest and dividend income |
657 | 1,349 | ||||||||||||
| Interest expense |
(206) | (275) | ||||||||||||
| Other, net |
3,165 | 7,505 | ||||||||||||
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| 3,616 | 8,579 | |||||||||||||
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| Income before income taxes |
22,808 | 47,024 | - | 51.5 | ||||||||||
| Income taxes |
3,648 | 16,202 | ||||||||||||
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| Consolidated net income |
19,160 | 30,822 | ||||||||||||
| Less: Net income attributable to noncontrolling interests |
2,502 | 4,300 | ||||||||||||
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| Net income attributable to Canon Inc. |
16,658 | 26,522 | - | 37.2 | ||||||||||
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| Results for the nine months | Millions of yen | |||||||||||||
| Nine months ended September 30, 2020 |
Nine months ended September 30, 2019 |
Change(%)
|
||||||||||||
| Net sales |
2,214,508 | 2,639,830 | - | 16.1 | ||||||||||
| Cost of sales |
1,252,954 | 1,453,192 | ||||||||||||
|
|
|
|
|
|||||||||||
| Gross profit |
961,554 | 1,186,638 | - | 19.0 | ||||||||||
| Operating expenses: |
||||||||||||||
| Selling, general and administrative expenses |
727,504 | 842,451 | ||||||||||||
| Research and development expenses |
199,736 | 222,189 | ||||||||||||
|
|
|
|
|
|||||||||||
| 927,240 | 1,064,640 | |||||||||||||
|
|
|
|
|
|||||||||||
| Operating profit |
34,314 | 121,998 | - | 71.9 | ||||||||||
| Other income (deductions): |
||||||||||||||
| Interest and dividend income |
2,282 | 4,266 | ||||||||||||
| Interest expense |
(594) | (811) | ||||||||||||
| Other, net |
14,094 | 18,759 | ||||||||||||
|
|
|
|
|
|||||||||||
| 15,782 | 22,214 | |||||||||||||
|
|
|
|
|
|||||||||||
| Income before income taxes |
50,096 | 144,212 | - | 65.3 | ||||||||||
| Income taxes |
11,952 | 41,332 | ||||||||||||
|
|
|
|
|
|||||||||||
| Consolidated net income |
38,144 | 102,880 | ||||||||||||
| Less: Net income attributable to noncontrolling interests |
8,415 | 10,531 | ||||||||||||
|
|
|
|
|
|||||||||||
| Net income attributable to Canon Inc. |
29,729 | 92,349 | - | 67.8 | ||||||||||
|
|
|
|
|
|||||||||||
-7-
CANON INC. AND SUBSIDIARIES
CONSOLIDATED
| Consolidated statements of comprehensive income
|
||||||||||||||||
| Results for the third quarter | Millions of yen | |||||||||||||||
| Three months ended September 30, 2020 |
Three months ended September 30, 2019 |
Change(%)
|
||||||||||||||
| Consolidated net income |
19,160 | 30,822 | - | 37.8 | ||||||||||||
| Other comprehensive income (loss), net of tax |
||||||||||||||||
| Foreign currency translation adjustments |
(757) | (32,032) | ||||||||||||||
| Net gains and losses on derivative instruments |
43 | (405) | ||||||||||||||
| Pension liability adjustments |
1,228 | 850 | ||||||||||||||
|
|
|
|
|
|||||||||||||
| 514 | (31,587) | |||||||||||||||
|
|
|
|
|
|||||||||||||
| Comprehensive income (loss) |
19,674 | (765) | - | |||||||||||||
| Less: Comprehensive income attributable to noncontrolling interests |
2,666 | 4,314 | ||||||||||||||
|
|
|
|
|
|||||||||||||
| Comprehensive income (loss) attributable to Canon Inc. |
17,008 | (5,079) | - | |||||||||||||
|
|
|
|
|
|||||||||||||
| Results for the nine months | Millions of yen | |||||||||||||||
| Nine months ended September 30, 2020 |
Nine months ended September 30, 2019 |
Change(%)
|
||||||||||||||
| Consolidated net income |
38,144 | 102,880 | - | 62.9 | ||||||||||||
| Other comprehensive income (loss), net of tax |
||||||||||||||||
| Foreign currency translation adjustments |
(36,333) | (86,203) | ||||||||||||||
| Net gains and losses on derivative instruments |
558 | (305) | ||||||||||||||
| Pension liability adjustments |
(8,518) | 3,527 | ||||||||||||||
|
|
|
|
|
|||||||||||||
| (44,293) | (82,981) | |||||||||||||||
|
|
|
|
|
|||||||||||||
| Comprehensive income (loss) |
(6,149) | 19,899 | - | |||||||||||||
| Less: Comprehensive income attributable to noncontrolling interests |
8,818 | 10,456 | ||||||||||||||
|
|
|
|
|
|||||||||||||
| Comprehensive income (loss) attributable to Canon Inc. |
(14,967) | 9,443 | - | |||||||||||||
|
|
|
|
|
|||||||||||||
-8-
CANON INC. AND SUBSIDIARIES
| CONSOLIDATED |
| |||||||||||||||
| 3. DETAILS OF SALES |
| |||||||||||||||
| Results for the third quarter |
Millions of yen | |||||||||||||||
| Sales by business unit | Three months ended
September 30, 2020 |
Three months ended
September 30, 2019 |
Change(%)
|
|||||||||||||
| Office |
335,860 | 425,339 | - | 21.0 | ||||||||||||
| Imaging System |
185,402 | 189,174 | - | 2.0 | ||||||||||||
| Medical System |
105,376 | 113,937 | - | 7.5 | ||||||||||||
| Industry and Others |
153,295 | 164,658 | - | 6.9 | ||||||||||||
| Eliminations |
(21,052) | (23,613) | - | |||||||||||||
|
|
|
|
|
|
|
|||||||||||
| Total |
758,881 | 869,495 | - | 12.7 | ||||||||||||
|
|
|
|
|
|
|
|||||||||||
| Millions of yen | ||||||||||||||||
| Sales by region | Three months ended September 30, 2020 |
Three months ended September 30, 2019 |
Change(%)
|
|||||||||||||
| Japan |
192,817 | 227,816 | - | 15.4 | ||||||||||||
| Overseas: |
||||||||||||||||
| Americas |
202,463 | 249,399 | - | 18.8 | ||||||||||||
| Europe |
195,737 | 199,874 | - | 2.1 | ||||||||||||
| Asia and Oceania |
167,864 | 192,406 | - | 12.8 | ||||||||||||
|
|
|
|
|
|
|
|||||||||||
| 566,064 | 641,679 | - | 11.8 | |||||||||||||
|
|
|
|
|
|
|
|||||||||||
| Total |
758,881 | 869,495 | - | 12.7 | ||||||||||||
|
|
|
|
|
|
|
|||||||||||
| Results for the nine months |
Millions of yen | |||||||||||||||
| Sales by business unit | Nine months ended September 30, 2020 |
Nine months ended September 30, 2019 |
Change(%)
|
|||||||||||||
| Office |
1,041,026 | 1,305,098 | - | 20.2 | ||||||||||||
| Imaging System |
478,804 | 570,177 | - | 16.0 | ||||||||||||
| Medical System |
313,322 | 328,500 | - | 4.6 | ||||||||||||
| Industry and Others |
439,701 | 507,209 | - | 13.3 | ||||||||||||
| Eliminations |
(58,345) | (71,154) | - | |||||||||||||
|
|
|
|
|
|
|
|||||||||||
| Total |
2,214,508 | 2,639,830 | - | 16.1 | ||||||||||||
|
|
|
|
|
|
|
|||||||||||
| Millions of yen | ||||||||||||||||
| Sales by region | Nine months ended September 30, 2020 |
Nine months ended September 30, 2019 |
Change(%)
|
|||||||||||||
| Japan |
584,788 | 657,922 | - | 11.1 | ||||||||||||
| Overseas: |
||||||||||||||||
| Americas |
600,699 | 745,835 | - | 19.5 | ||||||||||||
| Europe |
554,162 | 638,622 | - | 13.2 | ||||||||||||
| Asia and Oceania |
474,859 | 597,451 | - | 20.5 | ||||||||||||
|
|
|
|
|
|
|
|||||||||||
| 1,629,720 | 1,981,908 | - | 17.8 | |||||||||||||
|
|
|
|
|
|
|
|||||||||||
| Total |
2,214,508 | 2,639,830 | - | 16.1 | ||||||||||||
|
|
|
|
|
|
|
|||||||||||
*Based on the realignment of Canon’s internal reporting and management structure, from the beginning of the first quarter of 2020, Canon has reclassified certain businesses from the Industry and Others Business Unit to the Office Business Unit. Operating results for the three and nine months ended September 30, 2019 also have been restated.
| Notes: 1. The primary products included in each of the segments are as follows: | ||
| Office Business Unit : | ||
| Office multifunction devices (MFDs) / Laser multifunction printers (MFPs) / Laser printers / Digital continuous feed presses / Digital sheet-fed presses / Wide-format printers / Document solutions | ||
| Imaging System Business Unit : | ||
| Interchangeable-lens digital cameras / Digital compact cameras / Interchangeable lenses / Compact photo printers / Inkjet printers / Large format inkjet printers / Commercial photo printers / Image scanners / Calculators | ||
| Medical System Business Unit : | ||
| Digital radiography systems / Diagnostic X-ray systems / Computed tomography (CT) systems / Magnetic resonance imaging (MRI) systems / Diagnostic ultrasound systems / Clinical chemistry analyzers / Ophthalmic equipment | ||
| Industry and Others Business Unit : | ||
| Semiconductor lithography equipment / FPD (Flat panel display) lithography equipment / Vacuum thin-film deposition equipment / Organic LED (OLED) panel manufacturing equipment / Die bonders / Network cameras / Digital camcorders / Digital cinema cameras / Multimedia projectors / Broadcast equipment / Micromotors / Handy terminals / Document scanners | ||
| 2. The principal countries and regions included in each regional category are as follows: | ||
| Americas: United States of America, Canada, Latin America | ||
| Europe: United Kingdom, Germany, France, Netherlands, European countries, Middle East and Africa | ||
| Asia and Oceania: China, Asian countries, Australia | ||
-9-
CANON INC. AND SUBSIDIARIES
CONSOLIDATED
4. CONSOLIDATED STATEMENTS OF CASH FLOWS
| Millions of yen | ||||||||
| Nine months ended September 30, 2020 |
Nine months ended September 30, 2019 |
|||||||
| Cash flows from operating activities: |
||||||||
| Consolidated net income |
38,144 | 102,880 | ||||||
| Adjustments to reconcile consolidated net income to net cash provided by operating activities: |
||||||||
| Depreciation and amortization |
166,221 | 178,514 | ||||||
| (Gain) loss on disposal of fixed assets |
888 | 4,271 | ||||||
| Deferred income taxes |
(6,224) | (8,504) | ||||||
| Decrease in trade receivables |
99,975 | 76,967 | ||||||
| Increase in inventories |
(41,843) | (42,366) | ||||||
| Decrease in trade payables |
(23,945) | (28,295) | ||||||
| Decrease in accrued income taxes |
(7,519) | (16,501) | ||||||
| (Decrease) increase in accrued expenses |
(7,918) | 8,892 | ||||||
| Decrease in accrued (prepaid) pension and severance cost |
(9,548) | (8,515) | ||||||
| Other, net |
(14,164) | (72,831) | ||||||
|
|
|
|
|
|||||
| Net cash provided by operating activities |
194,067 | 194,512 | ||||||
| Cash flows from investing activities: |
||||||||
| Purchases of fixed assets |
(120,632) | (151,941) | ||||||
| Proceeds from sale of fixed assets |
7,617 | 120 | ||||||
| Purchases of securities |
(560) | (4,228) | ||||||
| Proceeds from sale and maturity of securities |
435 | 761 | ||||||
| (Increase) decrease in time deposits, net |
1,635 | (1,516) | ||||||
| Acquisitions of businesses, net of cash acquired |
(127) | (1,716) | ||||||
| Other, net |
(66) | 675 | ||||||
|
|
|
|
|
|||||
| Net cash used in investing activities |
(111,698) | (157,845) | ||||||
| Cash flows from financing activities: |
||||||||
| Proceeds from issuance of long-term debt |
2,100 | - | ||||||
| Repayments of long-term debt |
(873) | (2,410) | ||||||
| Increase in short-term loans, net |
185,767 | 132,657 | ||||||
| Transactions with noncontrolling interests |
1,376 | 362 | ||||||
| Dividends paid |
(126,938) | (171,487) | ||||||
| Repurchases and reissuance of treasury stock, net |
(50,005) | (50,003) | ||||||
| Other, net |
(4,526) | (5,557) | ||||||
|
|
|
|
|
|||||
| Net cash provided by (used in) financing activities |
6,901 | (96,438) | ||||||
| Effect of exchange rate changes on cash and cash equivalents |
(1,797) | (12,559) | ||||||
|
|
|
|
|
|||||
| Net change in cash and cash equivalents |
87,473 | (72,330) | ||||||
| Cash and cash equivalents at beginning of period |
412,814 | 520,645 | ||||||
|
|
|
|
|
|||||
| Cash and cash equivalents at end of period |
500,287 | 448,315 | ||||||
|
|
|
|
|
|||||
-10-
CANON INC. AND SUBSIDIARIES
CONSOLIDATED
5. NOTE FOR GOING CONCERN ASSUMPTION
Not applicable.
6. SIGNIFICANT CHANGES IN CANON INC. SHAREHOLDERS’ EQUITY
None.
7. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES
Canon’s consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles.
Recently Issued Accounting Guidance
In June 2016, the Financial Accounting Standards Board issued ASU No. 2016-13, Financial Instruments – Credit Losses – (Topic 326): Measurement of Credit Losses on Financial Instruments, which requires entities to use a current expected credit loss model to measure impairments of certain financial assets. Using this model results in earlier recognition of losses than under the incurred loss approach, which requires waiting to recognize a loss until it is probable of being incurred. Canon adopted the guidance from the quarter beginning January 1, 2020 with the modified retrospective basis through a cumulative effect adjustment directly to retained earnings as of the beginning of the period. The adoption of this guidance did not have a material impact on its consolidated results of operation and financial condition.
-11-