Form 6-K

6-K 1 d450237d6k.htm FORM 6-K Form 6-K

FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934


For the month of ….		July		……………………………………………… ,		2023



		CANON INC.
		(Translation of registrant’s name into English)

		30-2, Shimomaruko 3-Chome, Ohta-ku, Tokyo 146-8501, Japan
		(Address of principal executive offices)

[Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.


Form 20-F		X		Form 40-F

[Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.


Yes				No		X

[If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):82-....................

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


CANON INC.
(Registrant)


Date….	July 27, 2023	By....../s/.......... Sachiho Tanino.............
		(Signature)*




		Sachiho Tanino General Manager Consolidated Accounting Div. Canon Inc.

*Print the name and title of the signing officer under his signature.

The following materials are included.

1.	RESULTS FOR THE SECOND QUARTER AND THE FIRST HALF ENDED JUNE 30, 2023

LOGO

CONSOLIDATED RESULTS FOR THE SECOND QUARTER AND

THE FIRST HALF ENDED JUNE 30, 2023

July 27, 2023

CONSOLIDATED RESULTS FOR THE SECOND QUARTER


			(Millions of yen, thousands of U.S. dollars, except per share amounts)

	Actual
	Three months ended June 30, 2023		Three months ended June 30, 2022		Change(%)		Three months ended June 30, 2023
Net sales	¥	1,020,882	¥	998,799	+	2.2	$	7,040,566
Operating profit		92,274		98,475	-	6.3		636,372
Income before income taxes		101,128		85,196	+	18.7		697,434
Net income attributable to Canon Inc.	¥	65,403	¥	59,025	+	10.8	$	451,055

Net income attributable to Canon Inc. shareholders per share:
- Basic	¥	64.78	¥	56.85	+	13.9	$	0.45
- Diluted		64.75		56.83	+	13.9		0.45


CONSOLIDATED RESULTS FOR THE FIRST HALF
			(Millions of yen, thousands of U.S. dollars, except per share amounts)

	Actual								Projection
	Six months ended June 30, 2023		Six months ended June 30, 2022		Change(%)		Six months ended June 30, 2023		Year ending December 31, 2023		Change(%)
Net sales	¥	1,992,007	¥	1,878,149	+	6.1	$	13,737,979	¥	4,363,000	+	8.2
Operating profit		176,749		174,615	+	1.2		1,218,959		400,000	+	13.2
Income before income taxes		188,662		152,893	+	23.4		1,301,117		425,000	+	20.6
Net income attributable to Canon Inc.	¥	121,813	¥	105,000	+	16.0	$	840,090	¥	292,000	+	19.7


Net income attributable to Canon Inc. shareholders per share:
- Basic	¥	120.36	¥	100.82	+	19.4	$	0.83	¥	290.25	+	22.6
- Diluted		120.31		100.79	+	19.4		0.83		290.13	+	22.6


	Actual
	As of June 30, 2023		As of December 31, 2022		Change(%)		As of June 30, 2023
Total assets	¥	5,571,311	¥	5,095,530	+	9.3	$	38,422,834

Canon Inc. shareholders’ equity	¥	3,301,352	¥	3,113,105	+	6.0	$	22,767,945


Notes:		1. Canon’s consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles.
		2. U.S. dollar amounts are translated from yen at the rate of JPY145=U.S.$1, the approximate exchange rate on the Tokyo Foreign Exchange Market as of June 30, 2023, solely for the convenience of the reader.


Canon Inc.		30-2, Shimomaruko 3-chome, Ohta-ku,
Headquarter office		Tokyo 146-8501, Japan
		Phone: +81-3-3758-2111

- 1 -

I. Operating Results and Financial Conditions

2023 Second Quarter in Review

Looking back at the second quarter of 2023, although economic recovery showed signs of weakness in some regions, there was a moderate recovery overall. By region, in the United States, thanks to the strong employment situation, consumer spending remained steady. In Europe, however, the economy remained stagnant due to the downward pressure caused by rising interest rates. In China, despite domestic demand recovering thanks to the lifting of the government’s Zero-COVID strategy, the demand in real estate markets decreased. In other emerging countries, the economy remained solid, mostly centering around consumer spending and the service industry. In Japan, the economy recovered moderately driven by its solid export, the recovery of consumer spending and capital investments.

In the markets in which Canon operates, while concerns about an economic slowdown due to inflation and rising interest rate affected some markets, businesses remained firm thanks to the recovery of supplies following the resolution of component shortages and logistical disruptions. On a product basis, demand for office multifunction devices (MFDs) remained firm thanks to strong demand for high-productivity printing. For inkjet printers, the demand from customers working from home slowed. For laser printers, while demand slowed due to the curbing of corporate investments, new demand was generated through diversifying work styles. For cameras, demand remained solid, mainly for mirrorless cameras. For medical equipment, while there was a drop-off following a period of increased demand last year in response to the COVID-19 pandemic, demand remained firm mainly in Europe. For semiconductor lithography equipment, although demand for memory devices declined, investments stayed robust mainly for power devices, analog devices, and sensors. For FPD (Flat Panel Display) lithography equipment, demand declined due to reduced investments by panel manufacturers.

The average value of the yen during the second quarter and the first half of the year was ¥137.57 and ¥135.09 against the U.S. dollar, respectively, a year-on-year depreciation of approximately ¥8 and a year-on-year depreciation of approximately ¥12, and ¥149.62 and ¥145.88 against the euro, respectively, a year-on-year depreciation of approximately ¥12 and a year-on-year depreciation of approximately ¥11.

As for the second quarter, net sales for the second quarter increased by 2.2% year-on-year to ¥1,020.9 billion due to solid demand and new products that were well-received in the market, as well as the favorable effects of depreciation of the yen. Net sales for the first half of the year increased by 6.1% year-on-year to ¥1,992.0 billion. Gross profit as a percentage of net sales increased by 1.0 points year-on-year to 47.5% due to well-received adjustments to product prices, improvement of product costs, resulting from easing of component shortages and logistics disruptions, and depreciation of the yen. Gross profit for the second quarter increased by 4.5% year-on-year to ¥484.8 billion. Operating expenses increased by 7.4% year-on-year to ¥392.5 billion due to an increase in sales personnel and sales-related expenses accompanying a growth in sales. In addition, operating expenses denominated in foreign currencies increased due to the depreciation of the yen. As a result, operating profit decreased by 6.3% year-on-year to ¥92.3 billion. On the other hand, operating profit for the first half of the year increased by 1.2% year-on-year to ¥176.7 billion. Other income (deductions) increased by ¥22.1 billion year-on-year to ¥8.9 billion, due to gains on valuation of securities and a decrease of currency exchange losses from liabilities denominated in foreign currencies. As a result, income before income taxes increased by 18.7% year-on-year to ¥101.1 billion and net income attributable to Canon Inc. increased by 10.8% year-on-year to ¥65.4 billion. Income before income taxes for the first half of the year increased by 23.4% to ¥188.7 billion and first-half net income attributable to Canon Inc. increased by 16.0% to ¥121.8 billion.

Basic net income attributable to Canon Inc. shareholders per share was ¥64.78 for the second quarter, a year-on-year increase of ¥7.93, and ¥120.36 for the first half, a year-on-year increase of ¥19.54.

- 2 -

Results by Segment

Looking at Canon’s second-quarter performance by business unit, in the Printing Business Unit, MFDs for offices continued to sell well, significantly exceeding unit sales of the same period from the previous year, as the product supply shortage was abated, while demand for products including the imageRUNNER ADVANCE DX C5800 mid-speed color MFD series were solid. As for inkjet printers, the number of unit sales decreased compared with the same period of the previous year as the surge in demand from users working from home subsided. As for laser printers, the number of unit sales decreased compared with the same period of the previous year, when supplies of products recovered, partly due to the curbing of corporate investments. Regarding equipment for the production printing market, the number of unit sales increased compared with the same period of the previous year, with the new strengthened product lineup of imagePRESS V series models strengthened by the addition of the imagePRESS V1350. As a result, sales of the Printing Business Unit increased by 0.8% compared with the same period of previous year to ¥574.9 billion. Due to such effects as weak consumables sales, net income before tax for the second quarter decreased by 13.0% compared with the same period of the previous year to ¥61.6 billion. Sales for the combined first six months of the year totaled ¥1,133.1 billion, a year-on-year increase of 5.1%, while income before income taxes totaled ¥114.7 billion, a year-on-year decrease of 9.1%.

In the Imaging Business Unit, as for the interchangeable-lens digital cameras, unit sales increased due to steady sales of the EOS R6 Mark II full-frame mirrorless camera, EOS R7 and EOS R10 APS-C size mirrorless cameras released last year. The new entry-level EOS R50 and EOS R100 models, launched this year, were also well-received in the market. The market demand for some models even surpassed production capacity. Unit sales of lenses surpassed those of the same period of the previous year thanks to strong sales of RF-series interchangeable-lenses. Sales of network cameras increased thanks to strong demand and enhanced sales activity that leveraged the products’ expanding range of applications. As a result, sales for the second quarter of the Imaging Business Unit increased by 9.1% compared with the same period of the previous year to ¥219.2 billion, while net income before tax for the second quarter increased by 6.4% compared with the same period of the previous year to ¥35.0 billion as a result of improved profitability due to an enhanced product mix that included new products. Sales for the combined first six months of the year totaled ¥411.7 billion, a year-on-year increase of 15.0%, while income before income taxes totaled ¥72.5 billion, a year-on-year increase of 55.5%.

In the Medical Business Unit, while there was a drop-off following a period of increased demand last year in response to COVID-19, sales remained firm mainly in Europe. As a result, sales of the Medical Business Unit increased by 6.7% compared with the same period of the previous year to ¥126.1 billion. Net income before taxes for the second quarter decreased by 49.0% compared with the same period of the previous year to ¥4.4 billion due to an increase in personnel to strengthen sales. Sales for the combined first six months of the year totaled ¥257.2 billion, a year-on-year increase of 8.8%, while income before income taxes totaled ¥11.3 billion, a year-on-year decrease of 24.7%.

In the Industrial Business Unit, the number of semiconductor lithography equipment sold exceeded that of the same period of the previous year, supported by strengthened production capacity, and led by continued strong demand for power devices. For FPD lithography equipment, unit sales increased compared with previous year despite reduced investments by panel manufacturers as the panel market worsened. On the other hand, industrial equipment sales decreased compared with the previous year when it enjoyed strong corporate investment. As a result, net sales of the Industrial Business Unit decreased by 4.4% compared with the same period of the previous year to ¥74.9 billion, and net income before tax for the second quarter decreased by 25.2% compared with the same period of the previous year to ¥12.2 billion due to a drop-off following large investments in industrial equipment over the previous year. Sales for the combined first six months of the year totaled ¥136.9 billion, a year-on-year decrease of 6.7%, while income before income taxes totaled ¥19.8 billion, a year-on-year decrease of 31.0%.

- 3 -

Cash Flow

In the first half of the year, cash flow from operating activities increased by ¥25.5 billion year-on-year to ¥154.1 billion as a result of an increase in profit and working capital improvement, such as trade receivables. Cash flow used in investing activities increased by ¥11.0 billion to ¥94.4 billion from the same period of the previous fiscal year, when income temporarily increased due to the sales of an overseas branch office despite decreased purchases of securities. Accordingly, free cash flow increased by ¥14.5 billion compared with the previous year to ¥59.7 billion.

Cash flow from financing activities increased by ¥121.2 billion year-on-year to ¥98.7 billion due to an increase in short-term loans despite increased first-half dividend payouts of ¥3.4 billion and repurchases of ¥58.1 billion of treasury stock.

Owing to these factors, as well as the impact from foreign currency exchange adjustments, cash and cash equivalents increased by ¥180.1 billion to ¥542.2 billion from the end of the previous year.

Outlook

There are still some global economic uncertainties for the third quarter onward due to various geopolitical risks and the risk of an economic slowdown as a result of tightening monetary policies in response to inflation. However, the outlook for the global economy anticipates a continued recovery trend due to the normalization of markets after the lifting of movement restrictions following the COVID-19 pandemic.

In the markets in which Canon operates, demand for office MFDs is expected to continue to remain firm, thanks to strong demand for high-productivity printing as well as their reputation as key office devices. For inkjet printers, new home-use printing demand generated by the COVID-19 pandemic is expected to continue. In addition, demand for refillable ink tank models is expected to increase. For laser printers, demand is expected to recover from the second half of the year thanks to new demand generated from decentralization of offices. As for digital interchangeable-lens cameras, demand is expected to remain solid due to a recovery in travel and leisure. For network cameras, the market is expected to maintain stable growth due to continued expansion of security applications, along with the growing demand for enhancing productivity and quality at manufacturing and sales sites. In addition, the needs for downsizing and remote control in professional video production equipment are expected to continue, supported by the growing demand for online video content. As for the medical equipment market, demand is expected to remain solid despite ongoing uncertainty. For semiconductor lithography equipment, despite concerns of temporary shrinking in some memory device markets, demand for such products as power devices is expected to remain solid. Furthermore, robust demand is expected to continue as semiconductor factories are being constructed in various countries and regions from the viewpoint of economic security. For FPD lithography equipment, the market is likely to shrink due to ongoing delayed investments by panel manufacturers amid market sluggishness.

With regard to currency exchange rates on which Canon bases its performance outlook for the third quarter onwards, Canon anticipates exchange rates of ¥135.0 to the U.S. dollar and ¥145.0 to the euro, representing depreciation of approximately ¥3.0 against the U.S. dollar and depreciation of approximately ¥7.0 against the euro compared with the previous year. For the U.S. dollar and the euro, Canon expects the yen to depreciate by ¥5 compared with its previous forecast.

Upon taking into consideration of the aforementioned currency exchange rates, Canon revised its forecast upward to full-year consolidated net sales of ¥4,363.0 billion, a year-on-year increase of 8.2%; operating profit of ¥400.0 billion, a year-on-year increase of 13.2%; income before income taxes of ¥425.0 billion, a year-on-year increase of 20.6%; and net income attributable to Canon Inc. of ¥292.0 billion, a year-on-year increase of 19.7%.

- 4 -

Consolidated Outlook


Fiscal year	Millions of yen
	Year ending December 31, 2023				Change		Year ended December 31, 2022		Change (%)
	Previous Outlook (A)		Revised Outlook (B)		(B - A)		Results (C)		(B - C) / C
Net sales		4,313,000		4,363,000		50,000		4,031,414		+8.2%
Operating profit		380,000		400,000		20,000		353,399		+13.2%
Income before income taxes		410,000		425,000		15,000		352,440		+20.6%
Net income attributable to Canon Inc.		285,000		292,000		7,000		243,961		+19.7%

This document contains forward-looking statements with respect to future results, performance and achievements that are subject to risk and uncertainties and reflect management’s views and assumptions formed by available information. All statements other than statements of historical fact are statements that could be considered forward-looking statements. When used in this document, words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “project” or “should” and similar expressions, as they relate to Canon, are intended to identify forward-looking statements. Many factors could cause the actual results, performance or achievements of Canon to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in general economic and business conditions, changes in currency exchange rates and interest rates, introduction of competing products by other companies, lack of acceptance of new products or services by Canon’s targeted customers, inability to meet efficiency and cost reduction objectives, changes in business strategy and various other factors, both referenced and not referenced in this document. A detailed description of these and other risk factors is included in Canon’s annual report on Form 20-F, which is on file with the United States Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein. Canon does not intend or assume any obligation to update these forward-looking statements.

- 5 -

CANON INC. AND SUBSIDIARIES

CONSOLIDATED

II. Financial Statements

1. CONSOLIDATED BALANCE SHEETS


	Millions of yen
	As of June 30, 2023			As of December 31, 2022			Change
ASSETS
Current assets		2,445,877			2,155,914			289,963
Cash and cash equivalents		542,209			362,101			180,108
Short-term investments		3,066			10,905			(7,839	)
Trade receivables		612,535			636,803			(24,268	)
Inventories		898,126			808,312			89,814
Current lease receivables		154,414			137,038			17,376
Prepaid expenses and other current assets		251,686			215,990			35,696
Allowance for credit losses		(16,159	)		(15,235	)		(924	)
Non-current assets		3,125,434			2,939,616			185,818
Noncurrent receivables		11,634			12,996			(1,362	)
Investments		75,560			65,128			10,432
Property, plant and equipment, net		1,102,413			1,035,065			67,348
Operating lease right-of-use assets		122,209			117,843			4,366
Intangible assets, net		275,520			280,995			(5,475	)
Goodwill		1,008,250			972,626			35,624
Noncurrent lease receivables		328,976			279,332			49,644
Other assets		204,872			179,297			25,575
Allowance for credit losses		(4,000	)		(3,666	)		(334	)

Total assets		5,571,311			5,095,530			475,781

LIABILITIES AND EQUITY
Current liabilities		1,648,288			1,365,353			282,935
Short-term loans and current portion of long-term debt		536,739			296,384			240,355
Short-term loans related to financial services		41,600			41,200			400
Other short-term loans and current portion of long-term debt		495,139			255,184			239,955
Trade payables		360,498			355,930			4,568
Accrued income taxes		47,656			48,414			(758	)
Accrued expenses		347,766			365,847			(18,081	)
Current operating lease liabilities		35,870			33,281			2,589
Other current liabilities		319,759			265,497			54,262
Non-Current liabilities		377,964			381,147			(3,183	)
Long-term debt, excluding current portion of long-term debt		2,432			2,417			15
Accrued pension and severance cost		189,450			189,215			235
Noncurrent operating lease liabilities		87,798			85,331			2,467
Other noncurrent liabilities		98,284			104,184			(5,900	)

Total liabilities		2,026,252			1,746,500			279,752

Canon Inc. shareholders’ equity		3,301,352			3,113,105			188,247
Common stock		174,762			174,762			-
Additional paid-in capital		405,036			404,838			198
Retained earnings		3,790,085			3,729,244			60,841
Legal reserve		65,088			64,509			579
Other retained earnings		3,724,997			3,664,735			60,262
Accumulated other comprehensive income (loss)		247,829			62,623			185,206
Treasury stock, at cost		(1,316,360	)		(1,258,362	)		(57,998	)
Noncontrolling interests		243,707			235,925			7,782

Total equity		3,545,059			3,349,030			196,029

Total liabilities and equity		5,571,311			5,095,530			475,781


	Millions of yen
	As of June 30, 2023			As of December 31, 2022
Notes:
1. Accumulated depreciation		3,065,866			2,962,228
2. Accumulated other comprehensive income (loss):
Foreign currency translation adjustments		373,594			191,287
Net unrealized gains and losses on securities		5			(34	)
Net gains and losses on derivative instruments		(940	)		(428	)
Pension liability adjustments		(124,830	)		(128,202	)

- 6 -

CANON INC. AND SUBSIDIARIES

CONSOLIDATED

2. CONSOLIDATED STATEMENTS OF INCOME AND

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Consolidated statements of income

Results for the second quarter

Millions of yen

Three months
ended
June 30, 2023

Three months
ended
June 30, 2022

Change(%)

Net sales

1,020,882

998,799

2.2

Cost of sales

536,111

534,761

Gross profit

484,771

464,038

4.5

Operating expenses:

Selling, general and administrative expenses

306,492

290,844

Research and development expenses

86,005

74,719

392,497

365,563

Operating profit

92,274

98,475

6.3

Other income (deductions):

Interest and dividend income

3,158

1,017

Interest expense

(485

)

(296

)

Other, net

6,181

(14,000

)

8,854

(13,279

)

Income before income taxes

101,128

85,196

18.7

Income taxes

30,768

22,231

Consolidated net income

70,360

62,965

Less: Net income attributable to noncontrolling interests

4,957

3,940

Net income attributable to Canon Inc.

65,403

59,025

10.8

Results for the first half

Millions of yen

Six months
ended
June 30, 2023

Six months
ended
June 30, 2022

Change(%)

Net sales

1,992,007

1,878,149

6.1

Cost of sales

1,053,226

1,019,719

Gross profit

938,781

858,430

9.4

Operating expenses:

Selling, general and administrative expenses

599,529

537,759

Research and development expenses

162,503

146,056

762,032

683,815

Operating profit

176,749

174,615

1.2

Other income (deductions):

Interest and dividend income

5,553

1,625

Interest expense

(815

)

(530

)

Other, net

7,175

(22,817

)

11,913

(21,722

)

Income before income taxes

188,662

152,893

23.4

Income taxes

56,572

40,135

Consolidated net income

132,090

112,758

Less: Net income attributable to noncontrolling interests

10,277

7,758

Net income attributable to Canon Inc.

121,813

105,000

16.0

- 7 -

CANON INC. AND SUBSIDIARIES

CONSOLIDATED

Consolidated statements of comprehensive income


Results for the second quarter	Millions of yen
	Three months ended June 30, 2023			Three months ended June 30, 2022			Change(%)
Consolidated net income		70,360			62,965			+	11.7
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments		152,329			153,903
Net unrealized gains and losses on securities		15			-
Net gains and losses on derivative instruments		(758	)		(1,302	)
Pension liability adjustments		974			(461	)

		152,560			152,140

Comprehensive income (loss)		222,920			215,105			+	3.6
Less: Comprehensive income (loss) attributable to noncontrolling interests		6,285			4,042

Comprehensive income (loss) attributable to Canon Inc.		216,635			211,063			+	2.6


Results for the first half	Millions of yen
	Six months ended June 30, 2023			Six months ended June 30, 2022			Change(%)
Consolidated net income		132,090			112,758			+	17.1
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments		183,924			266,031
Net unrealized gains and losses on securities		39			-
Net gains and losses on derivative instruments		(462	)		(2,484	)
Pension liability adjustments		3,151			(735	)

		186,652			262,812

Comprehensive income (loss)		318,742			375,570			-	15.1
Less: Comprehensive income (loss) attributable to noncontrolling interests		11,723			8,792

Comprehensive income (loss) attributable to Canon Inc.		307,019			366,778			-	16.3

- 8 -

CANON INC. AND SUBSIDIARIES

CONSOLIDATED

3. DETAILS OF SALES

Results for the second quarter

Millions of yen

Sales by business unit

Three months ended
June 30, 2023

Three months ended
June 30, 2022

Change(%)

Printing

574,931

570,462

0.8

Imaging

219,238

200,897

9.1

Medical

126,115

118,231

6.7

Industrial

74,855

78,262

4.4

Others and Corporate

46,175

54,540

15.3

Eliminations

(20,432

)

(23,593

)

Total

1,020,882

998,799

2.2

Millions of yen

Sales by region

Three months ended
June 30, 2023

Three months ended
June 30, 2022

Change(%)

Japan

210,419

205,927

2.2

Overseas:

Americas

321,353

329,770

2.6

Europe

265,764

250,988

5.9

Asia and Oceania

223,346

212,114

5.3

810,463

792,872

2.2

Total

1,020,882

998,799

2.2

Results for the first half

Millions of yen

Sales by business unit

Six months ended
June 30, 2023

Six months ended
June 30, 2022

Change(%)

Printing

1,133,084

1,077,665

5.1

Imaging

411,661

358,098

15.0

Medical

257,170

236,429

8.8

Industrial

136,916

146,742

6.7

Others and Corporate

96,615

103,312

6.5

Eliminations

(43,439

)

(44,097

)

Total

1,992,007

1,878,149

6.1

Millions of yen

Sales by region

Six months ended
June 30, 2023

Six months ended
June 30, 2022

Change(%)

Japan

439,170

426,485

3.0

Overseas:

Americas

616,575

582,440

5.9

Europe

519,762

468,668

10.9

Asia and Oceania

416,500

400,556

4.0

1,552,837

1,451,664

7.0

Total

1,992,007

1,878,149

6.1

Based on the realignment of Canon’s internal management structure, from the fourth quarter ended December 31, 2022, Canon has changed the name and structure of segments from Industrial and Others Business Unit and Corporate and eliminations to Industrial Business Unit, Others and Corporate and Eliminations. Also, a certain business, which was previously included in Others, has been presented within the Printing Business Unit from the beginning of the first quarter of 2023. Operating results for the three and six months ended June 30, 2022 have also been reclassified.


Notes:		1. The primary products included in each of the segments are as follows:
		Printing Business Unit :
		Office multifunction devices (MFDs) / Document solutions / Laser multifunction printers (MFPs) / Laser printers / Inkjet printers / Image scanners / Calculators / Digital continuous feed presses / Digital sheet-fed presses / Large format printers
		Imaging Business Unit :
		Interchangeable-lens digital cameras / Interchangeable lenses / Digital compact cameras / Compact photo printers / MR Systems / Network cameras / Video management software / Video content analytics software / Digital camcorders / Digital cinema cameras / Broadcast equipment / Projectors
		Medical Business Unit :
		Computed tomography (CT) systems / Diagnostic ultrasound systems / Diagnostic X-ray systems / Magnetic resonance imaging (MRI) systems / Clinical chemistry analyzers / Digital radiography systems / Ophthalmic equipment
		Industrial Business Unit :
		Semiconductor lithography equipment / FPD (Flat panel display) lithography equipment / OLED Display Manufacturing Equipment / Vacuum thin-film deposition equipment / Die bonders
		Others :
		Handy terminals / Document scanners

		2. The principal countries and regions included in each regional category are as follows:
		Americas: United States of America, Canada, Latin America Europe: United Kingdom, Germany, France, Netherlands, European countries, Middle East and Africa Asia and Oceania: China, Asian countries, Australia

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

4. CONSOLIDATED STATEMENTS OF CASH FLOWS


	Millions of yen
	Six months ended June 30, 2023			Six months ended June 30, 2022
Cash flows from operating activities:
Consolidated net income		132,090			112,758
Adjustments to reconcile consolidated net income to net cash provided by operating activities:
Depreciation and amortization		111,196			111,102
Loss (gain) on disposal of fixed assets		2,488			(12,594	)
Deferred income taxes		(4,931	)		(4,023	)
Decrease in trade receivables		62,621			5,356
Increase in inventories		(38,614	)		(81,678	)
Increase in lease receivables		(30,563	)		(4,286	)
(Decrease) increase in trade payables		(6,116	)		52,265
Decrease in accrued income taxes		(2,341	)		(15,474	)
Decrease in accrued expenses		(40,608	)		(13,769	)
Decrease in accrued pension and severance cost		(15,175	)		(19,959	)
Other, net		(15,990	)		(1,119	)

Net cash provided by operating activities		154,057			128,579
Cash flows from investing activities:
Purchases of fixed assets		(90,685	)		(87,649	)
Proceeds from sale of fixed assets		2,208			14,197
Proceeds from maturity of held to maturity securities		-			2,151
Purchases of securities		(294	)		(10,774	)
Proceeds from sale and maturity of securities		8,735			1,628
Acquisitions of businesses, net of cash acquired		(14,525	)		(3,258	)
Other, net		192			310

Net cash used in investing activities		(94,369	)		(83,395	)
Cash flows from financing activities:
Repayments of long-term debt		(1,022	)		(914	)
Increase in short-term loans related to financial services, net		400			1,000
Increase in other short-term loans, net		234,219			87,859
Dividends paid		(60,931	)		(57,517	)
Repurchases and reissuance of treasury stock, net		(58,100	)		(50,008	)
Other, net		(15,891	)		(2,929	)

Net cash provided by (used in) financing activities		98,675			(22,509	)
Effect of exchange rate changes on cash and cash equivalents		21,745			30,252

Net change in cash and cash equivalents		180,108			52,927
Cash and cash equivalents at beginning of period		362,101			401,395

Cash and cash equivalents at end of period		542,209			454,322

*	Certain items in the consolidated statements of cash flows for the six months ended June 30, 2022, have been reclassified to conform to the current year’s presentation.

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

5. NOTE FOR GOING CONCERN ASSUMPTION

Not applicable.

6. NOTE ON SIGNIFICANT CHANGES IN CANON INC. SHAREHOLDERS’ EQUITY

None.

7. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Canon’s consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles.

8. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SUBSEQUENT EVENT

On July 3, 2023, Canon borrowed ¥32 billion under its existing overdraft facilities with Mizuho Bank, Ltd. and MUFG Bank, Ltd. for required operating funds. The overdraft facilities bear interest at a rate equal to a base rate plus a spread.

On July 3, 2023, Canon Medical Systems Corporation, a subsidiary of the Company, acquired 100% of the issued shares of Minaris Medical Co., Ltd. and Minaris Medical America, Inc., (hereinafter referred to collectively as “Minaris Medical”) from Resonac Corporation. In the medical business, Canon is working to strengthen our core business of diagnostic imaging systems, while also working to expand into areas such as healthcare IT and in vitro diagnostics. This acquisition will allow synergy between Minaris Medical’s diverse solutions in the in-vitro diagnostics business and Canon’s technologies in the fields of automated biochemical analyzers, diagnostic imaging, and healthcare IT. By leveraging this synergy, Canon will be able to provide added value to meet the demands of the market. Further information related to the accounting for this business combination has not been disclosed, because none of the activities required to complete the initial accounting for this acquisition have been completed as of the announcement date of the second quarter of 2023 consolidated results.

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SEC Form 6-K filed by Canon Inc.