* Q1 operating profit up 0.2 pct to 82.7 bln yen, vs 89.8
* Full-year operating forecast upped to 450 bln yen
By Tim Kelly
SINGAPORE, April 25 Canon Inc on
Wednesday raised its full-year profit forecast, as a weakening
yen boosted the value of overseas earnings and burgeoning demand
for higher-end digital cameras helped offset fewer sales of
Earning about 80 percent of its income overseas, Canon is
benefitting greatly from a weakening yen, which should also help
other Japanese exporters by boosting the value of repatriated
"Most of the 150 billion addition to sales and 70 billion
increase in the operating profit forecast came from the 5 yen
weaker yen-dollar rate," Canon's chief financial officer,
Toshizo Tanaka said at a briefing in Tokyo.
Canon lowered its currency forecast to 80 yen to the dollar
from a 75 yen prediction in January.
From July through most of February the Japanese currency
traded above 80 yen to the dollar, breaking through 76 yen in
November. That strength prompted many Japanese firms to offer
conservative currency estimates. Since Feb. 22 the yen has
weakened to below 80 yen, going as low as 84 yen in mid-March.
Canon upped its operating forecast for the 12 months to Dec.
31 to 450 billion yen ($5.55 billion) from a January prediction
of 390 billion yen. That was slightly below a consensus
expectation for 466 billion yen based on the average of 23
estimates from analysts surveyed by Thomson Reuters I/B/E/S.
FOCUSED ON CAMERAS
While other Japanese electronics makers struggle under the
burden of losses in their television units, Canon has remained
profitable by keeping its consumer business focused on digital
imaging, allowing it to tap a burgeoning market for higher end
digital single reflex (DSLR) cameras.
"Canon is different than Sony and Panasonic because it
doesn't make televisions and consumer electronics, so it doesn't
have the same structural problems as other firms," said Naoki
Fujiwara, a fund manager at Shinkin Asset Management, which
manages about 500 billion yen in assets and does not disclose
its holding. "I expect all consumer electronics makers will
benefit structurally from foreign exchange," he added.
Since the beginning of the year Canon's shares have gained
nearly 10 percent, compared with a 4 percent dip in Sony's
In trading Wednesday, Canon gained 1.5 percent to 3,800 yen,
valuing the company at more than $60 billion, nearly four times
the size of Sony's $16.5 billion market capitalisation.
For the quarter ended March 31, the camera and
printer-maker's operating profit was 82.7 billion yen, flat
compared with 82.5 billion yen in the same quarter of the
previous year. Profit from office equipment slipped 16 percent
with camera sales, which account for over a third of revenue,
gaining 17 percent.
The result was just shy of consensus expectations for an
89.8 billion yen profit, from six analysts surveyed by Thomson
The maker of IXUS and PowerShot cameras, which built its
first camera in 1933, competes against Nikon and Sony.
In printers and other office equipment its main rival is Xerox