Q1: Canon Reported 33.5% Net Income Decline

	Canon announced its first quarter financial report on April 23rd. The company reported ¥816.7 billion (U.S. $8,688 million) net sales in the first quarter, 1.5% less compared with the same period last year. Operating expenses increased 7.4% year on year to ¥331.1 billion (U.S. $3,523 million) but operating profit decreased by 33.8% to ¥54.8 billion (U.S. $583 million). Net income decreased by 33.5% to ¥40.9 billion Continuing weakness in the global economy, growing signs of a slowdown in China and Europe, and severe price competition are said to be the major reasons for its declines. Sales for the Office Business Unit totaled ¥464.2 billion (U.S.$4,938 million), an increase of 6.0% year on year, while operating profit totaled ¥60.1 billion (U.S.$639 million) , an increase of 13.7%. The products in this unit include laser and multifunction devices (MFDs). According to Canon, “Laser printers recorded a slight increase in sales volume year on year owing to sales expansion efforts centered on new products introduced last year offering exceptional environmental performance through such features as energy-saving functions and quiet operation.” “Sales performance of color demand for multifunction devices (MFDs), led by the imageRUNNER ADVANCE C5200/C2200 series, increased from the year-ago period, total sales volume for both color and monochrome models decreased slightly due to deterioration in business confidence in the United States and Asia. Sales of the Océ VarioPrint 135 series, which was jointly developed by Canon and Océ for production printing, showed solid growth.” Inkjet printers are classified in the Imaging System Business Unit, which reported ¥298.1 billion (U.S.$3,171  million) sales, declined by 1.8% and ¥28.5 billion (U.S.$303 million) operating profit, a decrease of 39.1%. In the first quarter, new inkjet printers featuring improved designs and operability in addition to enhanced print quality and other basic functionality were recognized by the market. Hence, a significant increase in sales volume from the year-ago period was reported. Canon expects the global economy to realize a moderate recovery in the latter half of the year. In the 2nd quarter, demand for MFDs is projected to grow moderately mainly for color models fueled by the recovery of the global economy, while demand in the laser printer market is expected to realize a slight increase from last year. As for inkjet printers, with the growth in emerging markets offsetting the decline in developed countries, demand overall is expected to remain around the same level as for the previous year.