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Investing.com -- Canon Inc reported first-quarter results, with sales reaching a record high of ¥1.0584 trillion, up 7.1% year-over-year, and operating profit (OP) of ¥95.0 billion, up 20.5%.
The results were in line with the company’s internal expectations. This marks the fourth consecutive quarter of year-over-year sales increase and the third straight quarter of rising operating profit excluding impairments.
The increase in operating profit, which rose 20% year-over-year, is attributed to benefits from a sales structure revamp in FY12/24. The consensus had forecast sales of ¥1.0557 trillion and an operating profit of ¥102.9 billion.
However, Canon has revised its FY12/25 guidance, reducing its sales guidance by ¥86.0 billion and its operating profit guidance by ¥53.0 billion. The company has also revised its foreign exchange assumptions. These revisions are expected to reduce sales by ¥74.0 billion and operating profit by ¥19.3 billion.
Canon’s new FY12/25 guidance anticipates sales of ¥4.65 trillion, up 3.1% year-over-year, an operating profit of ¥466.0 billion, up 4.8%, and a net profit of ¥333.0 billion, up 108%. The company’s earnings per share guidance is for ¥364.18, up 120%. The consolidated dividend per share guidance remains unchanged at ¥160, up ¥5 year-over-year, for a payout ratio of 43.9%.
The company completed a ¥100 billion share buyback at the start of the fiscal year and announced another ¥100.0 billion buyback on March 13. No repurchases had been made as of the end of March.
Canon’s first-quarter guidance took into account the impact of tariffs to a certain extent. The company believes a uniform tariff rate of 10% is likely to continue, and there is a risk of a global economic downturn.
Despite this, Canon is able to secure a certain level of earnings and continue share buybacks, demonstrating the strength of its earnings structure. However, the earnings environment remains uncertain, including foreign exchange.
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