July 25, 2016

Summary Report of Consolidated Financial Results
for the second quarter ended June 30, 2016

Registered company name:
Stock listing:Code number:
URL:
Representative director:
Contact:

Canon Marketing Japan Inc.
Tokyo Stock Exchange, First Section
8060
http://cweb.canon.jp/eng/ir
Masahiro Sakata, President
Shiro Hamada, Director Vice President
Tel. +81-3-6719-9071
Dividend payable date (as planned):
August 26, 2016
U.S. Accounting Standards Applied:No
1.Consolidated business results for the three months ended June 30, 2016 (From January 1, 2016 to June 30, 2016)(1) Consolidated Results of Operations(Amounts less than one million yen are truncated)(Percentage represents increases or decreases from the previous year)
Profit attributable
Operating income
Ordinary income
to owners of parent

Net sales
Six months ended

Millions of yen%

Millions of yen%

Millions of yen%

306,236(2.5)

10,31521.0

11,221

17.1

6,641

30.8

314,096

(4.3)

8,522

(31.9)

9,585(28.7)

5,075(35.4)

June 30, 2016
June 30, 2015
[Note] Comprehensive Income:Millions of yen%Six months ended June 30, 2016 : 7,560 million yen [30.6%]
Six months ended June 30, 2015 : 5,787 million yen [(27.2%)]
Basic earnings
per share

Diluted earnings
per share

YenYenJune 30, 2016

51.21

-

June 30, 2015

39.14

-

Six months ended(2) Consolidated Financial Position(Amounts less than one million yen are truncated)
Total assets

Net assets

Millions of yen

Millions of yen

Second quarter ended June 30, 2016
Year ended December 31, 2015
[Reference] Shareholders' equity:

Equity ratio

Net asset per share%Yen

462,693281,74560.8

2,169.34

486,502277,43856.92,136.22

Second quarter ended June 30, 2016 : 281,302 million yen
Year ended December 31, 2015 : 277,008 million yen

2.Dividends
Dividend per share

Dividend per share

Year-end

AnnualFirst quarter-end

Second quarter-end

Third quarter-end

Yen

Yen

Yen

YenYenYear ended December 31, 2015

-

20.00

-

25.00

45.00

Year ending December 31, 2016

-

20.00
-

25.00

45.00

Year ending December 31, 2016
(forecast)[Note] Revision of cash dividend forecast for this period : Yes
3.Consolidated financial forecast for the fiscal year ending December 31, 2016

Net sales
Millions of yen

Full year

650,000(Amounts less than one million yen are truncated)(Percentage represents increases or decreases from the previous year)
Profit attributable
Basic earnings
Operating income
Ordinary income
to owners of parent
per share%

Millions of yen%

Millions of yen%

0.6

27,0001.3

28,2000.6[Note] Revision of forecast for this period : Yes-1-%

Yen

17,700 13.0

136.50Millions of yen

* Others(1) Material changes in subsidiaries during this period(Changes in scope of consolidations resulting from change is subsidiaries) :(2) Application of a specified accounting procedure :

None
Yes

(3) Changes in accounting policies and accounting estimates, retrospective restatement( i ) Changes in accounting policies based on revisions of accounting standard :Yes( ii ) Changes in accounting policies other than ( i ) :None( iii ) Changes in accounting estimates :None( iv ) Retrospective restatement :None(4) Number of issued and outstanding shares (common stock)( i ) Number of issued and outstanding shares at the end of fiscal year (including treasury stock)
As of June 30, 2016 :

151,079,972

As of December 31, 2015 :

151,079,972( ii ) Number of treasury stock at the end of the period
As of June 30, 2016 :21,408,217

As of December 31, 2015 :

21,407,663( iii ) Average number of shares
As of June 30, 2016 :

129,671,964

As of June 30, 2015 :

129,674,131* Implementation Status of Review Processes
At the time this quarterly Financial Report is released, procedures are underway to review quarterly financial
statements pursuant to the Financial Instruments and Exchange Law.
Disclaimer :Earnings projections are based on information available at the time these materials were announced, and theCompany cannot guarantee that they will be realized. Also, actual results may differ from the estimated figures
given due to various factors.

-2-Consolidated Quarterly Balance Sheets(Amounts less than one million yen are truncated)
As of December 31, 2015

As of June 30, 2016

AssetsCurrent assets
Cash and deposits

36,773

61,771

Notes and accounts receivable-trade125,906

97,753

Securities

62,80035,000

Merchandise and finished goods

28,327

27,599791

1,080Work in process
Raw materials and supplies

887

819

Deferred tax assets

5,280

5,312

Short-term loans receivable

80,05490,044

Other

6,922

7,109

Allowance for doubtful accounts

(201)

(93)

347,542

326,397

46,926

48,104

Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net

175

163

4,357

4,420

Rental assets, net

11,511

11,372

Land

35,93935,310Tools, furniture and fixtures, net

Leased assets, net
Total property, plant and equipment

400

302

99,31099,673

Intangible assets
Goodwill820

673

Software

8,268

7,300

Leased assets

7664

Right of using facilities

317

318

Other

15

13

9,499

8,370

7,789

7,028

Total intangible assets
Investments and other assets
Investment securities
Long-term loans receivable

1010

Deferred tax assets

14,76814,151

Guarantee deposits

5,274

4,926

Other

2,605

2,536

Allowance for doubtful accounts

(298)

(400)

Total investments and other assets

30,15028,251

138,959

136,296486,502462,693

Total non-current assets
Total assets-3-Consolidated Quarterly Balance Sheets(Amounts less than one million yen are truncated)
As of December 31, 2015

As of June 30, 2016

Liabilities
Current liabilities
Notes and accounts payable-trade

101,834

80,715

Lease obligations

222

189

Accrued expenses

22,11815,969

Income taxes payable

6,201

4,613

Accrued consumption taxes

5,131

2,740

Provision for bonuses

3,506

5,255

Provision for directors' bonuses

130

44

Provision for product warranties

529

516

Provision for loss on order received

487

Other

19,99924,783

Total current liabilities

159,678

134,916

Lease obligations

321

239

Deferred tax liabilities

581

498

Deferred tax liabilities for land revaluation

2625

Accrued long service rewards for employees

943

1,013

Net defined benefit liability

42,822

39,666

Other

4,689

4,588

Non-current liabilities

Total non-current liabilities
Total liabilities

49,38546,031

209,064

180,947

73,30373,303

Net assets
Shareholders' equity
Capital stock
Capital surplus

82,82082,820Retained earnings

151,036

154,436

Treasury shares(31,911)(31,913)

Total shareholders' equity

275,247

278,646

2,775

2,192

0(42)

Foreign currency translation adjustment

224

40

Remeasurements of defined benefit plans(1,240)465

Total accumulated other comprehensive income

1,760

2,656

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges

Non-controlling interests
Total net assets
Total liabilities and net assets-4-430443

277,438

281,745486,502462,693

Consolidated Quarterly Statements of Income(Amounts less than one million yen are truncated)
Six months of FY2015(from January 1, 2015
to June 30, 2015)

Six months of FY2016(from January 1, 2016
to June 30, 2016)

Net sales

314,096306,236

Cost of sales

201,967

196,292

Gross profit

112,128

109,943

Selling, general and administrative expenses

103,606

99,628

8,522

10,315

141

127

Operating income
Non-operating income
Interest income
Dividend income

8798

Insurance income

573

596

Other462

315

1,263

1,138

Total non-operating income
Non-operating expenses
Interest expenses

168

Foreign exchange losses

4561

Other

137

161

Total non-operating expenses

200231

9,585

11,221Gain on sales of non-current assets

2158

Insurance income on disaster21

Ordinary income
Extraordinary income

Other-

Total extraordinary income

230159Extraordinary losses
Loss on sales and retirement of non-current assets

90

Impairment loss

183
-Loss on disaster

14

Group reorganization expenses

100

Other

74

Total extraordinary losses

109
16102

279

412

Income before income taxes and minority interests

9,330

10,968

Income taxes

4,235

4,308

Profit

5,094

6,659

18

18

5,075

6,641

Profit attributable to non-controlling interests
Profit attributable to owners of parent[Note] Revision of cash dividend forecast for this period : Yes-5-Consolidated Quarterly Statements of Comprehensive Income(Amounts less than one million yen are truncated)
Six months of FY2015(from January 1, 2015
to June 30, 2015)
ProfitSix months of FY2016(from January 1, 2016
to June 30, 2016)

5,094

6,659

960

(583)

Other comprehensive income
Valuation difference on available-for-sale-securities
Deferred gains or losses on hedges

3(42)Foreign currency translation adjustment

14(178)Remeasurements of defined benefit plans, net of tax

(285)

1,706

Total other comprehensive income

693

901

5,787

7,560

5,766

7,537

2123

Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests-6-Consolidated Quarterly Statements of Cash Flows(Amounts less than one million yen are truncated)
Six months of FY2015(from January 1, 2015
to June 30, 2015)

Six months of FY2016(from January 1, 2016
to June 30, 2016)

Cash flows from operating activities
Income before income taxes and minority interests

9,330

Depreciation

8,018

Impairment loss

10,968
7,503-

Amortization of goodwill

122

109
115

Increase (decrease) in allowance for doubtful accounts

(55)

(5)

Increase (decrease) in net defined benefit liability

(550)

(643)

Increase (decrease) in provision for bonuses

1,101

1,749

Interest and dividend income

(228)

(225)

Interest expenses

168

Loss (gain) on sales and retirement of property, plant and equipment

86

16

22,92628,051

Decrease (increase) in notes and accounts receivable-trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable-trade(543)

492(13,512)(21,070)

Other, net(7,544)(5,263)

Subtotal

19,16821,807

Interest and dividends income received

227233

Interest expenses paid

(16)

(11)

Income taxes paid

(6,426)(6,240)Net cash provided by (used in) operating activities

12,952

15,788(6,183)(4,978)Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment

56712(2,033)(749)

Purchase of investment securities

(94)

(190)

Proceeds from sales of investment securities

180

Proceeds from sales of shares of subsidiaries and associates

5-(29,999)(9,990)Purchase of intangible assets

Net decrease (increase) in short-term loans receivable
Other, net
Net cash provided by (used in) investing activities

(141)

143

(38,372)(15,051)

(228)

(125)

(4)

(1)

(3,238)(3,240)

(10)

(10)

Cash flows from financing activities
Repayments of finance lease obligations
Purchase of treasury shares
Cash dividends paid
Dividends paid to non-controlling shareholders
Other, net
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents

0-(3,482)(3,377)0(161)Net increase (decrease) in cash and cash equivalents(28,903)(2,801)

Cash and cash equivalents at beginning of period

120,607

99,573

Cash and cash equivalents at end of period

91,704

96,771-7-

Consolidated Quarterly Segment Information
I. Six months of FY2015 (from January 1, 2015 to June 30, 2015)
Information on net sales and income (loss) by reportable segment.
BusinessSolutions(Amounts less than one million yen are truncated)

ITSolutions

ImagingSystem

56,46578,622

Industrial /Medical

Other

Total

Adjustment Consolidated

Net sales
Sales - external customers

164,888-

Sales - intersegment
Total
Operating income (loss)

14,668

14,105-14--

314,096-

14,668(14,668)

314,096-

164,888

71,13378,622

14,105

14

328,765(14,668)

314,096

4,381

1,537

2,635

(256)

223

8,522

-

8,522

[Note]
1. "Other" includes businesses, such as shared service businesses, which are not included in other reportable segments.
2. "Operating income (loss)" is equal to the "Operating income" of "Consolidated Quarterly Statements of Income."II. Six months of FY2016 (from January 1, 2016 to June 30, 2016)
Information on net sales and income (loss) by reportable segment.
BusinessSolutions(Amounts less than one million yen are truncated)

ITSolutions

Imaging
System

58,55368,078Industrial /Medical

Other

Total

Adjustment Consolidated

Net sales
Sales - external customers

165,594-

Sales - intersegment

13,863

13,994-

13--

306,236-

13,863(13,863)306,236-

Total

165,594

72,417

68,07813,99413

320,099(13,863)306,236

Operating income

5,057

2,625

1,734

708

189

10,315-10,315[Note] "Other" includes businesses, such as shared service businesses, which are not included in other reportable segments.
1. "Other" includes businesses, such as shared service businesses, which are not included in other reportable segments.
2. "Operating income " is equal to the "Operating income" of "Consolidated Quarterly Statements of Income."-8-