SEOUL The chairman of Canon Inc (7751.T), the world's largest digital camera maker, said on Sunday the company's year-end holiday sales were "disappointing" and expected a difficult 2009 as an economic downturn hits consumer demand.
"We had very big influence from the deteriorated economic situation. Unfortunately we are not an exception," Chairman Fujio Mitarai told Reuters on the sideline of a business meeting in Seoul.
"(Holiday sale) was disappointing but this is happening all over the world." he said on the sidelines of a meeting hosted by South Korean business associations.
With consumer demand for electronics declining rapidly due to the spreading economic downturn, the outlook for the global $40 billion digital camera market is becoming increasingly glum.
Japanese makers are also taking a hit from a stronger yen, which hurts their price competitiveness overseas.
Canon, which competes with Sony Corp (6758.T) and Nikon Corp (7731.T), has benefited from the growing market for single-lens reflex (SLR) cameras, but demand for such high-end models are set to fall on the slowing economy.
"This year must be the worst year" in terms of the overall economy and digital camera sales, Mitarai said when asked about the prospects for 2009. He added that a recovery could hinge on how the U.S. government could spur up its economy.
Mitarai is also chairman of Nippon Keidanren, Japan's biggest business lobby group.
In November, Canon President Tsuneji Uchida told Reuters the global digital camera market may contract in 2009. Then last month, the company said it would delay the construction of a $196 million digital camera plant in Japan due to slow demand.
Analysts surveyed by Reuters Estimates forecast Canon's net profit would fall to 213 billion yen ($2.36 billion) in 2009 from 359 billion yen estimated for 2008 and 488 billion yen it earned in 2007.
(Editing by Anshuman Daga)