Canon sees profit gain on weak yen, rising sales

Japanese camera and office equipment maker Canon Inc reported a hefty 16 per cent gain in profit for the first fiscal quarter today, largely on a favourable exchange rate, but such strong growth was not expected to hold up.
Canon's January-March net profit totalled 47.6 billion yen (467 million USD) on quarterly sales of 868.3 billion yen (8.5 billion USD), up 6 per cent on year, as healthy laser printer and copier demand offset shrinking camera sales.
Like other Japanese exporters, Canon got a perk from the falling yen, which lifts the value of its overseas earnings. But Canon and others cannot expect the dollar's rise to continue at the same rate this year.

Canon said the dollar cost 97.84 yen last year, and that it will likely cost 100.61 yen this year.
Canon is projecting a 240 billion yen (2.4 billion USD) profit for fiscal 2014, up 6 per cent from the previous year, on 3.86 trillion yen (37.8 billion USD) in sales, up 3 per cent from the previous year.
Although camera sales have suffered lately with the arrival of smart phones with digital cameras, Japan saw a big rush to buy cameras ahead of a tax hike that kicked in from April 1, the Tokyo-based manufacturer said.
Demand for ink jet printers also increased in Japan for the three-month period, Canon said.

A recovery in the US and European economies was expected to help support Canon's results for the rest of the year. A drop in demand in Japan was likely for the second quarter after the rush to buy ahead of the tax rise, but that was also expected to recover later in the year, according to Canon.