Canon Marketing Japan Group
Medium-Term Management Plan (2022-2025) Progress Report
January 27, 2023

Canon Marketing Japan Inc.
Masachika Adachi, President© Canon Marketing Japan Inc. 2023

Agenda1. Medium-Term Management Plan

(2022-2025) progress report
2. Major future initiatives

3. Towards sustainable growth2© Canon Marketing Japan Inc. 2023

Agenda1. Medium-Term Management Plan
(2022-2025) progress report
2. Major future initiatives
3. Towards sustainable growth3© Canon Marketing Japan Inc. 2023

Progress on the Companywide Consolidated Financial Plan
(Billions of yen)
2021

2022
(figures announced in
January)

2022(Actual)

YoY

Sales

552.1

580.0

588.1

+36.0

+8.1

of which, ITS sales

221.1

235.8

241.4

+20.3

+5.6

Op. income

39.7

40.5

49.9

+10.2

+9.4

ratio

7.2%

7.0%

8.5%

+1.3%

+1.5%

Net income attributableto owners of parent

29.4

29.5

35.6

+6.2

+6.1

ROE

8.2%

7.7%

9.2%

+1.1%

+1.6%

© Canon Marketing Japan Inc. 2023

Compared with figuresannounced in January4Progress on Financial Plans by Segment(Billions of yen)■Consumers■Enterprise■Area■Professional© Canon Marketing Japan Inc. 2023

2021

2022
(figures announced in
January)

2022(Actual)

YoY

Sales

129.5

130.3

136.6

+7.1

+6.3

Op. Income

13.6

12.0

13.9

+0.4

+1.9

ratio

10.5%

9.2%

10.2%

-0.3%

+1.0%

Sales

190.6

196.0

202.7

+12.1

+6.7

Op. Income

13.9

13.9

17.1

+3.2

+3.2

ratio

7.3%

7.1%

8.4%

+1.1%

+1.3%

Sales

220.8

232.5

226.6

+5.7

-5.9

Op. Income

12.0

13.5

15.6

+3.5

+2.1

ratio

5.4%

5.8%

6.9%

+1.5%

+1.1%

Sales

31.5

39.8

41.7

+10.1

+1.9

Op. Income

2.5

3.4

5.2

+2.8

+1.8

ratio

7.9%

8.5%

12.5%

+4.6%

+4.0%

Compared with figuresannounced in January5Medium-Term Management Plan (2022-2025) Basic Policies© Canon Marketing Japan Inc. 2023

6

Trends in ITS Business Sales by Business Area
Through specific initiatives aimed at creating and enhancing the service business model, we
achieved growth surpassing the previous year in every area.
(Billions of yen)

YoY

241.4

+9.2％

221.1

235.8

SI Services

73.0

85.4

Maintenance and operation
service / outsourcing

47.6

45.0

50.5

+6.1％

IT products andsystem sales

100.5

105.4

108.8

+8.3％

2021
Actual

2022
figures announced in
January

2022
ActualSales© Canon Marketing Japan Inc. 2023

82.0

+12.3％

7

ITS Business: Progress on ITS Business KPIs by Customer Segment
By continuing to refine our strengths leveraging our unique technological capabilities, we far
surpassed the previous year's performance, driving the "profitable growth" of the ITS Business.

Largecompanies

Enterprise

Quasi-major
and uppermedium-sizedcompanies

2021

2022

¥23.0 billion¥26.5 billion

YoY

+15%

2021
Mathematical
DigitalLow-codeanddocument
demanddevelopment
service
forecasts¥32.5 billion

Area© Canon Marketing Japan Inc. 2023

HOME & IT maintenance andoperation services
2021

2022

YoY

Approx. 135,000

Approx. 160,000+19%¥21.5 billion
2022

2022

¥37.0 billion
Small andmedium-sizedcompanies

Sales related to
ITO and BPO
2021*Includes

Imaging
solutions

Security

YoY

+14%

¥22.0 billion
YoY

+2%

Contribution of the service business model to value creation

Sales related to Edge Solution

8

ITS Business: Major Initiatives in the ITS Business by Customer Segment
We rolled out new initiatives and services in each priority area.
In particular, we successfully created a service business model focused on Edge solutions.

Promote DX business through co-creation with customers

Large
companies

Enterprise

Provision of business platforms and sector/business-specificservices
DigitalDigitalWork
Shifting our own
services to the
cloud

Area

Small andmedium-sizedcompanies

Edge Solutions
Imaging
solutions

Quasi-major
and uppermedium-sizedcompanies

Low-codedevelopment

document
serviceEnhancement ofsolutions with afocus on ESET

ITO・BPO
Expansion ofadded-value
services

Accelerator

EDI

Strengthening
physical security
Cloud-based
video
recordingservice

HOME & IT maintenance andoperation services

Rollout of industryspecific BPO
services
Public inquiry
BPO / OCR
serviceCooperation

Supporting DX at small- and medium-sized businesses
Maintenanceand operation
services© Canon Marketing Japan Inc. 2023

Security

NI cloudservice

9

ITS Business: Business Investment by Customer Segment
We have made progress in enhancing functions and supplementing resources by actively
pursuing business investment, including share acquisitions and strategic business alliances.
Edge Solutions
Large
companies

Creation and upstream shift of industry-specific services

Enterprise

Quasi-major
and uppermedium-sizedcompanies

ITO・BPO

Investment

Security

Investment

Investment
Investment

Area

Strengthening the area of management
consulting
Partnership© Canon Marketing Japan Inc. 2023

Canon Medical
Systems
Corporation

M&A

Investment

HOME & IT maintenance andoperation services
Small andmedium-sizedcompanies

Transferbusinesses

Enhancing
video-oriented
AI

Strengthening of BPO
businesses for HR andpayroll operations

Strengthen the
Healthcare IT
BusinessCanon
ITS
MedicalInc.

10

ITS Business: Change in Sales
By pursuing concrete measures in priority areas with a focus on service business models,
we have expanded the ITS business with profit.

(Billions of yen)

18-22CAGR

＋4.4％

2,500

241.4

227.1
209.4

203.1

3,000

221.1
2,000

1,500

1,000

500

0

2018
© Canon Marketing Japan Inc. 2023

2019

2020

2021

2022
11

Canon Product Business: Initiatives for Each Major ProductWe developed an efficient and highly profitable business by running sales channel-appropriate
strategies for each major product.

 4K remote cameras for video
production

BtoB

 Business inkjet printers equippedwith extra-large capacity tanks

 Professional 4K video cameras

 LBPs that help streamline
large-quantity high-speed
output operations for
manufacturing and logistics

 Office monochrome MFPs withenhanced environmental
performance

Cloud-based printing service that supports office MFPs and home-use inkjet printers Full-frame mirrorless cameras

BtoC

 APS-C format mirrorlesscameras / Lenses for APS-C
format cameras

Growth rateof unit priceper unit+70.1%(from 2018 levels)*Marketshares in
2022

No. 1 market share* According to Canon MJ research© Canon Marketing Japan Inc. 2023

 Six home-use inkjet printermodels+50.8%

No. 1 market share+10.7%+1.7%

No. 1 market shareNo. 3 market share12Industrial Equipment Business in Specialized Areas: Initiatives
In addition to the orders for projects that have already been implemented, sales in thesemiconductor services business expanded in part due to support for multi-vendor maintenance.
As a result, we achieved sales growth of over 150%.
Industrial Equipment Business: Change in Sales by Segment

Initiatives in the Industrial Equipment Business(Billions of yen)+56%

 Customeroriented
 Use of online
seminars

Discovery

Planning
and Sales Proposals
using cuttingedge
technologies

Installation/Ma
intenance Resident services
 Support for multi-vendor maintenanceImproved
Expanded results mainlyin the semiconductor services business© Canon Marketing Japan Inc. 2023

13

Establishment of a Lean Business Structure
We have continued to implement initiatives aimed at constantly reducing both SG&A expenses andthe SG&A expense ratio. We will work to expand the size of our business based on this lean
structure.
(Billions of yen)

SG&A ratio

SG&A
Expenses※* Personnel expenses of customer engineers have been included in costs from 2018.
© Canon Marketing Japan Inc. 2023

14

Major Evaluation from External Entities
1. Recognition Related to ESG in General Selected as a constituent of several indices Awarded Silver Class in the Sustaina ESG Awards 2022

2. Recognition Related to Human Capital Acquired Eruboshi Certification (Canon MJ and Canon ITS)
 Platinum Kurumin certification (Canon MJ and Canon ITS) Health & Productivity Management Outstanding Organization:
certified for 5 consecutive years (Canon MJ)

3. Recognition Related to Business andOrganizational Strength Ranked first for the ten consecutive year in the security products category in the Nikkei
Computer Customer Satisfaction Survey 2022-2023
 Achieved 4 Star Rating in 6th Nikkei Smart Work Management Survey
 Received "Kyokan!" IR Award from the Japan Investor Relations Association
 Recognized as excellent as a result of the Cyber Index Corporate Survey 2022 by the Information
Technology Federation of Japan© Canon Marketing Japan Inc. 2023

15

Agenda1. Medium-Term Management Plan
(2022-2025) progress report
2. Major future initiatives
3. Towards sustainable growth© Canon Marketing Japan Inc. 2023

16

Business Environment Perception
While the Canon products market is expected to undergo a continuous market contraction, demandin the ITS market will remain strong. In light of market trends, we will improve productivity for Canon
products, and pursue further strengthening in the priority areas of the ITS business.
Canon products market

ITS market

Digital camera adoption rate and long-term change in the average numberof units owned in adopter households* Source: Consumer Confidence Survey 2022, Cabinet Office

Top 5 issues businesses want to solve with IT investments

58%

業務プロセスの効率化(デジタル化等)
Business process streamlining(digitalization, etc.)

Digital Camera Adoption Rate

働き方改革(テレワーク)
Work style reform(tele work)

40%

Strengthening of security
セキュリティ強化

37%

Average Number of Units Owned Per Adopter Household

2012

2013

2014

2015

2016

2017

Change in Percentage of Companies
Implementing Telework

2018

2019

2020

2021

2022

* Source: Results of survey of telework implementation rates, Tokyo
Metropolitan Government Bureau of Industrial and Labor Affairs

33%

Insight into information through the
デジタルの利活用による情報把握
use ofdigital technologies

23%

Improved社内コミュニケーションの強化
internal communication
0%

20%

40%

60%

80%

* Source: 2022 Corporate IT Trends Survey, Japan Users Association of Information Systems (JUAS)

Period understate of emergency
Mar. Apr.

2020© Canon Marketing Japan Inc. 2023

Telework
adoption

Needs in ITS priority areas*

Apr. May. Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May. Jun. Jul. Aug.

2021

2022

* EdgeSOL, security, maintenance and operation services

17Medium-Term Management Plan (2022-2025) Basic Policies
Having added “Maximizing human capital value” to the basic policies, we will accelerate
execution and promotion.
2022-2025
Medium-Term
Management
Plan
Basic Policies

Expand ITS business withprofit Carry out and accelerate
strategies for different
customer groups
 Implement the servicetype business model toexpand the stockbusiness

Increase earnings
capacity of existing
businesses

Strengthen specialized
areas and create new
businesses

 Conduct strategies
tailored to customer
groups Increase the profitabilityof the business of main
products

 Continue growth of theindustrial equipment
business
 Create new businesses

Group management aimed at continuous growth Maximizing human capital value Addition
 Establish an engagement improvement cycle
 Speed up business investments towards growth© Canon Marketing Japan Inc. 2023

18

Updated Companywide Consolidated Financial Plan
Updated Financial Plan for ThreeYear Management Plan 2022-2025(Billions of yen)

2025
Comparison withpreviously
announced figures

2022

2023
(Projection)

2025(Projection)

2025(previously
announced figures)

Sales

588.1

624.0

650.0

650.0

0

of which, ITS sales

241.4

269.2

300.0

300.0

0

Op. Income

49.9

50.0

58.0

50.0

+8.0

ratio

8.5%

8.0%

8.9%

7.7%

+1.2%

ROE

9.2%

8.7%

9.0%

8.0%

+1.0%

© Canon Marketing Japan Inc. 2023

19

Updated Financial Plans by Segment
Updated Financial Plan for ThreeYear Management Plan 2022-2025
2022

2025
(Projection)

2025(previously
announced figures)

Op. Income

136.6
13.9

142.5
14.0

127.5
13.0

127.5
10.5

0
+2.5

ratio

10.2%

9.8%

10.2%

8.2%

+2.0%

202.7
17.1

215.0
17.3

249.0
22.5

249.0
20.0

0
+2.5

8.4%

8.0%

9.0%

8.0%

+1.0%

226.6
15.6

239.4
17.3

245.0
19.5

245.0
17.5

0
+2.0

6.9%

7.2%

8.0%

7.1%

+0.9%

Op. Income

41.7
5.2

44.9
3.4

46.0
6.0

46.0
5.0

0
+1.0

ratio

12.5%

7.6%

13.0%

10.9%

+2.1%

Sales

■Enterprise

Op. Income

ratio
Sales

■Area

Op. Income

ratio
Sales

■Professional© Canon Marketing Japan Inc. 2023

2025
Comparison withpreviously
announced figures

2023(Projection)

Sales■Consumers(Billions of yen)

20

Medium-Term Management Plan (2022-2025）Basic Policy

2022-2025
Medium-Term
Management
Plan
Basic Policies

Expand ITS business withprofitIncrease earnings
capacity of existing
businesses Carry out and accelerate
strategies for different
customer groups
 Implement the servicetype business model toexpand the stockbusiness

 Conduct strategies
tailored to customer
groups Increase the profitabilityof the business of main
products

Strengthen specialized
areas and create new
businesses
 Continue growth of theindustrial equipment
business
 Create new businesses• ITS Business by Customer Segment: 2025 KPI Targets• 2025 Sales Targets by ITS Area
• Measures to achieve KPIs

© Canon Marketing Japan Inc. 2023

21

ITS Business: KPIs by Customer Segment
Steady progress is being made towards achieving the 2025 KPIs.
Going forward, we will aim for profitable growth by improving and expanding service-type businessmodels.

Largecompanies

Enterprise

Quasi-major
and uppermedium-sizedcompanies

2022

CAGR

¥26.5 billion

+19%

2025

¥45.0 billion

2022
Mathematical
DigitalLow-codeanddocument
demanddevelopment
service
forecasts¥37.0 billion

Area© Canon Marketing Japan Inc. 2023

HOME & IT maintenance andoperation services
2022

CAGR

Approx.160,000

+11%

2025

Approx. 220,000¥22.0 billion
CAGR

CAGR

+9%
Small andmedium-sizedcompanies

Sales related
To ITO and BPO
2022*Includes

Imaging
solutions

Security

+13%
2025

2025

¥48.5 billion¥32.0 billion

Contribution of the service business model to value creation

Sales related to Edge Solution

22

ITS Business: Sales Targets by Business Area
Steady progress is being made towards achieving the 2025 KPIs.
Going forward, we will aim for profitable growth by improving and expanding service-type businessmodels.
(Billions of yen)

300.0
269.2
241.4
Sales

209.6

221.1

100.1
82.0

SI Services

70.9

23-25CAGR

50.5

57.5

100.5

108.8

111.5

2021

2022

2023
Projection

Maintenance and operation
service / outsourcing

37.2

47.0

IT products andsystem sales

101.3

2020

© Canon Marketing Japan Inc. 2023

75.0

73.0

＋14.2％(25%※)※composition
ratio

2025
Projection

23

Edge Solutions: Rollout of Video Solutions
We will develop and scale-up our lineup of products and services in the areas of viewing and recording. In the
future, we will cater to increasingly diverse customer needs by expanding into the video DX area using industry
× business operations as a starting point.
Areas of Viewing and Recording
Large
companies

On-premise

Cloud

Enhancementof features

Video DX
infrastructure

Quasi-major andupper-mediumsized companies

Video DX area(video utilization)

Industry × Business EdgeSolution

Co-creation(Exclusive domestic sales)

API integration

Use of AI

Promoting customers' DX

Small andmedium-sizedcompanies

Manufacturing© Canon Marketing Japan Inc. 2023

Retail24

Edge Solutions: Digital Document Service Rollout
An Electronic Transaction Management Service to centrally manage electronic data and promotes datautilization has been released. In addition, we will enhance our applications designed for specific business
operations and services tailored to specific industries, to promote customers' business process reforms.

Largecompanies

Digital document service

Canon productbusiness

Form solution

ITS business

Digital work flow ... etc.

Store

Analysis

Quasi-major andupper-mediumsized companies

B-to-B transaction service
Promoting integration with business applications
Accounting
systemSmall andmedium-sizedcompanies

InvoicingEnhancing industry-specific apps and SI core

Order form
receipt

Utilization of cloud-based
development infrastructure

Electronic Transaction Management Service
Complying with Law on Book andRecord Keeping
through Electronic Methods© Canon Marketing Japan Inc. 2023

Services for specific industries

Business system integration

Centralized management ofprinted and digital media

Workflow25

Rollout of HOME & IT Maintenance and Operation Services
Targeting small and medium-sized businesses struggling to comply with the Electronic Books Preservation Act
amid shortages of dedicated IT personnel, we will help with digitalization and productivity improvements, suchas providing total support from IT equipment maintenance to operation.
HOME
Large
companies

IT maintenance and operations

Supporting DX at small- andmedium-sized businesses
Strengthening
DX support

Strengthening of
security<Physical security> Safie integration
Quasi-major
and uppermedium-sizedcompanies

 Expanded sales of
HOME Select Series Expanding thelineup Cross-selling / Upselling Increasing customer satisfaction throughimproved support skills
 Increasing sales efficiency through improved
sales support© Canon Marketing Japan Inc. 2023

Security measures
Protection against
information leaks

Data protection
SecuritypackComputer operation<Cyber security>

Improving HOME Contact Center support
Small andmedium-sizedcompanies

Supporting the evolution ofcustomers with IT

Support for PC
operation

NEW

MaintenanceSupport for network and operation
services
operation
Device selection

Introduction
supportSupport for server
operation
Support for AP
operation

Recovery
supportOperation
supportSecurity pack
Maintenance and operation
services26

Rollout of the Security BusinessFor each customer segment, we will not only pursue product-out approaches but also enhance ourpresence in the security market by strengthening in-house development products, our security
services and efforts in the field of operation support.
Cyber security

Physical security
Large
companies

Focus on handling individual projects
Expanded cross-selling

Consulting field
Vulnerabilities
assessment service

Quasi-major
and uppermedium-sizedcompanies

MSS/SOC

Expansion by cross selling

Earning operation support orders
Small andmedium-sizedcompanies© Canon Marketing Japan Inc. 2023

Cooperation

Also help expand ITS for small- andmedium-sized businesses
27

Expansion of the ITO and BPO BusinessWe will enhance high added-value services in the data center business and made proactive investments. In the
BPO business, we will leverage the strengths of QB5 to expand our operations to a wide range of customer
segments.
ITO (Data Center Business)Largecompanies

1.on SOLTAGE
Run sales strategies by solution

BPO
1. Expand governmentrelated BPO services

2. Acquisition of digital
document storage BPO

Expansion of
HR-related
BPO

DWA

Quasi-major
and uppermedium-sizedcompanies

SOLTAGE Cloud
service

2. Proactive Investment

Small andmedium-sizedcompanies© Canon Marketing Japan Inc. 2023

Rollout of the UTM
Security Operation
Support Service(Saveddocuments)

BPO(Work performed
on a consignment
basis)

Invoices

Contracts

Purchase orders

Creditchecks

Receivedorders

Accounts receivable

Accounts
payableExpansion to small- andmedium-sized businesses
Use ofcustomer base Expand to a wide
range of customer
segments

 Improvements toefficiency andquality

Packaging28

Reorganization to Strengthen the Healthcare IT BusinessIn the Hospital and Clinic Business, the core business of Canon ITS Medical Inc., we will maximize
the business transfer synergy with Canon Medical Systems Corporation to pursue growth that isaccompanied by profit.
Hospital

ClinicExpansion of prime projects at small- and mediumsized hospitals
Large hospitals Cooperation(200-399 beds)

Prime

Expansion of

Cooperation

Large hospitals

Doublethe numberof customers(400 or more beds)

Medium-sized hospitals

Strengthening the electronic health records lineup forsmall-scale operations

Maintain

2022

Total proposals for
departmental
systems

Improved lineup

Electronic healthrecords for large
hospitals

Electronic healthrecords to strengthen
admission functions

Medium-sized hospitals(200-399 beds)

Small hospitals
ClinicSmall hospitals prime projects(～199 beds)

Existing domains(400 or more beds)

2025

Mission-critical system

Departmental system

Electronic medical
records andmedical accounting

Medical Image
Place, etc.

(～199 beds)

Electronic healthrecords for mediumsized hospitals
Electronic healthrecords for small
hospitals andclinics(On-premise)

Cloud-based electronic
health records

Accelerate strategy due to business transfer
Canon Medical Systems Corporation■ Function
Development© Canon Marketing Japan Inc. 2023

Hospital information systems and medical examination systems(electronic health records, medical accounting systems, etc.)* Package development and maintenance is not applicable
Sales

Systemintegration (SI)

MaintenanceSE resources

Customer base29

Medium-Term Management Plan (2022-2025）Basic Policy

2022-2025
Medium-Term
Management
Plan
Basic Policies

Expand ITS business withprofit Carry out and accelerate
strategies for different
customer groups
 Implement the servicetype business model toexpand the stockbusiness

Increase earnings
capacity of existing
businesses

Strengthen specialized
areas and create new
businesses

 Conduct strategies
tailored to customer
groups Increase the profitabilityof the business of main
products

 Continue growth of theindustrial equipment
business
 Create new businesses• Specific Measures in Printing Business Fields• Specific Measures in the Camera Business© Canon Marketing Japan Inc. 2023

30

Canon Product Business: Printing BusinessWe will work to gain a commanding view over the entire value chain for each customer segment,
implement proposals that suit customer needs, and expand into new industries.

Large
companies

Quasi-major
and uppermedium-sizedcompanies

Small andmediumsizedcompanies© Canon Marketing Japan Inc. 2023

Develop solutions to comply
with laws and regulations orrooted in solutions tocustomer business issues<Large- to upper-medium-sizedcompany>
 DWA expansion<Small and medium-sizedcompanies>
 SOL for complying with theElectronic Books PreservationAct Launch models featuring highdurability and low running costs

Win sector-specificprojects and businesscollaboration projects

Obtain new upper-mediumsized customers to achievebusiness enlargement

Strengthen andintensify area
marketing Promotion of working on focused industries
 Strengthening proposal linked to operational
system Providing Printing environment that meets newworking style Strengthening effective sales using EC channels

31

Canon Product Business: Camera Business
Strengthen relationships with customers with a lineup of products that meets their needs andenhanced total service, while pooling the collective strengths of the Canon Group to pursue a pivot
from "Cameras" to "Imaging."
Attain higher profitability

Expansion of the imaging business

Products thatmeetcustomerneeds

Professional
Press and advertising

Still subjects

Total strategy for imaging
Existing imaging
business

Video production solutions

・・・
Intermediate(High amateur)

Historical sites
and culture

Flowers and insects

Enhancementof services

Moving subjects

・・・
SportsRailway

After-sales
supportUse,
experienceand distribute

Next-generation consumer-use
video system

Comparison
andconsideration

Purchase

Entry(Beginners)

Recording daily life / travel

Further increasing profitability
in the camera business© Canon Marketing Japan Inc. 2023

From
recognition
to interest

Creating a next-generation
imaging business
32

Medium-Term Management Plan (2022-2025）Basic Policy

2022-2025
Medium-Term
Management
Plan
Basic Policies

Expand ITS business withprofitIncrease earnings
capacity of existing
businesses

Strengthen specialized
areas and create new
businesses Carry out and accelerate
strategies for different
customer groups
 Implement the servicetype business model toexpand the stockbusiness

 Conduct strategies
tailored to customer
groups Increase the profitabilityof the business of main
products

 Continue growth of theindustrial equipment
business
 Create new businesses• Specific Measures in the Industrial Equipment Business• Specific Measures to Create New Businesses© Canon Marketing Japan Inc. 2023

33

Initiatives in Specialized Areas: the Industrial Equipment BusinessWe will work to discover new commercial products and expand the size of business whilestrengthening our workforce in the fields of installation and maintenance to establish a businessstructure that can generate continuous sales and profits.
Customers

Suppliers

Diversified needs

Various seeds

Canon MJ Group (platform holder with multi-vendor maintenance capabilities)
Discovery

Planning and Sales

Installation/MaintenanceConsideration of
new commercial products

Expansion ofexisting businessSupport for multi-vendor
maintenance Target domains••

Power semiconductor manufacturers
Material manufacturers

 Expand semiconductor-related business

Evatec products

Mattson products Develop ideal human resources infield support engineer positions

 Priority products••

Wafer processing equipment
Inspection and analysis equipment© Canon Marketing Japan Inc. 2023

 Gain skills, human resources andexpertise through proactive
business investment

 Expand sales ofaerostatic bearings foroverseas markets

 Improve customer satisfaction in
the service domain

34

Initiatives to Create New Businesses
We will pursue initiatives for innovation skills to take root companywide, and while aiming to create
independent businesses as spin-outs and joint ventures from the in-house entrepreneurship programand other initiatives to create businesses.
■New business creation
Customer Problem Fit

Problem Solution Fit

6 months

Solution Product Fit

2 years-0～1.5 years…
Business development
managers

Programparticipants

Spin-out /joint venture formation
Establishment of acompany…

Repeated business verification
0-to-1 business development
Launch of a
project

In-house entrepreneurial
program enabling new
business creation

Product Market Fit

Intrapreneurs

Support through business development accelerator■ Initiatives to help innovation skills take root
companywide

Skills measurement
Design thinking tests
Implementing innovation
skill improvement
measures targeting all
employees© Canon Marketing Japan Inc. 2023

Follow-up
Innovation training
Academy workshops

Skill acquisition
Basic courses on design thinking(e-Learning)

35Medium-Term Management Plan (2022-2025）Basic Policy

2022-2025
Medium-Term
Management
Plan
Basic Policies

既存事業の専門領域の強化・利益を伴った更なる収益性強化
新たな事業の創出
ITS事業拡大• Approach to maximizing the value of human capital• Specific measures to improve human resources
 顧客層別ITS戦略の 顧客層に応じた
 産業機器事業の• Specific measures to improve
実行・加速
戦略展開 engagement
更なる成長 主要製品事業の 新たな事業の創出
 サービス型事業モデルに• Initiatives for growth investment
よる
ストックビジネス拡大

更なる高収益化Group management aimed at continuous growth Maximizing human capital value Addition
 Establish an engagement improvement cycle
 Speed up business investments towards growth© Canon Marketing Japan Inc. 2023

36

Group Human Resources Strategy: Maximize the Value of Human Capital
We will clarify the human resource strategies needed to achieve our business strategies, and strive
to maximize the value of human capital.

Improvements in our Corporate Value
Professional corporate group that solves social and customer issues using ICT and the power of humans

maximize the value of human capital
Development ofskilled personnel

Engagement Improvement

Employee job
satisfaction

Rewardingsense ofcontribution© Canon Marketing Japan Inc. 2023

Motivation
for growth

Customersatisfaction

Developmentof skilled personnel

Increasein valueprovided37

Group Human Resources Strategy: Improvement of Human Resources
To clarify our human capital, we have defined skill requirements on a departmental basis, visualized "as is" and "to be" states,
and clearly identified the gap that exists. To close the gap, we will make improvements and enhancements to high-level IT
personnel and work to raise the base level of IT skills.
Clarifying [occupation] × [skill level]
Selective
training forspecific
occupations

Issues revealed (gap) and measures to address them

Improved expertise in line withbusiness strategy

Improving and enhancing highly
skilled IT personnel
Business

Specialized
training for
eachdepartment

Basiccompanywi
de training

concept

CBU

EBU

ABU

PBU

Headqua
rters /
Head
OfficeRaise the level of basic
IT skills

Data science

domaindomain2021: IT passport exam
2022: Conducting data literacy training

2023: DX/DX Business Test
© Canon Marketing Japan Inc. 2023

DX domain・・・

Acquired by approx.
5,000 employees

Approx. 4,000 employees
took the training

Working toward themas a whole group38

Group Human Resources Strategy: Improving Engagement
Since 2021 had conducted a group employee awareness survey with the aim of visualizing and improving engagementscores. We will work to enhance diversity and develop a comfortable work environment, including efforts to raise thepercentage of managerial positions filled by women and the percentage of male employees taking childcare leave.

Group Employee Awareness Survey•••

Promotion of diversity
Non-consolidated

An awareness survey was conducted for Canon MJ Group
employees
Responses to questions were on a four-point scale from"agree," and "somewhat agree" to "somewhat disagree" and"disagree," and scored out of a maximum 1,000 points.
Response rate: 87% (+2％ year on year)

678

Ratio of female managers
女性管理職比率
Ratio of men who took childcare leave
男性育休取得率

686

32%
27%
18%
13%

7%
2.4%

7%
4%
2.6%

2021
© Canon Marketing Japan Inc. 2023

2022

2025

3.1%

3.5%

3.7%

4.0%

2.9%

2016 2017 2018 2019 2020 2021 2022

2025

39

Group Investment Strategy: Investment for Growth
We make proactive investments to realize our business and human resource
strategies.

Investment for growth

Investment for growth

approx. 90.0 billion yen

At least 200.0 billion yen

2016© Canon Marketing Japan Inc. 2023

2017

2018

2019

2020

2021

2022

2023

2024

2025
40

Group Investment Strategy: Cash Allocation
We proactively invest in businesses, systems and human resources to realize our business strategy,
and strive to achieve an investment cycle that is mindful of capital efficiency and profitability.
Shareholder returns
2022 - 2025

Operatingcash flow

Investment
for growth
At least

200.0
Cash onhand

Investment details

ITS business growth

M&A andPriority areas• Edge solutions• IT maintenance for small- andmedium-sized businesses• Data centers• Security etc.

New business creation

investment

System investment

Investment in
human resources

Reinvestment

billion yen

Domains for investment

Cash and deposits needed© Canon Marketing Japan Inc. 2023

41

Agenda1. Medium-Term Management Plan
(2022-2025) progress report
2. Major future initiatives
3. Towards sustainable growth© Canon Marketing Japan Inc. 2023

42

Promotion of Sustainability Management
Attain kyosei, or harmonious coexistence, stated in the corporate philosophy to pursue sustainability
management aimed at realizing harmony between humans, society and nature and creating a society
in which all of humanity can live happily together.

Customers
Suppliers

Employees

Shareholders
Investors

Publicagencies, local
governments

NGO
NPO

Educational andresearch institutions

Promotion ofsustainability management
Corporate value sustainably
Increased by solving social issues
Through business

Local communities© Canon Marketing Japan Inc. 2023

43

Canon Marketing Japan Group's Solving of Social Issues through Business
To promote sustainability management, expand the range of things it is possible to solve by combining
the Canon product business and IT solution business and work on the solution of social issues throughbusiness.

Combinationof businesses

ITS Business

Fulfilling lives throughVideo culture

White Logistics
Movement

Food waste
reduction

Work-stylereforms

Canon productbusiness

Increased
productivity
Safe and
Secure society© Canon Marketing Japan Inc. 2023

44

A company that
attracts hopes,
affection and attention
43© Canon Marketing Japan Inc. 2023

45

The performance and future projections made in this document are based on information available at the present time, and include potential risks and inaccuracies.
Please be aware that due to changes in a variety of factors, actual results may differ materially from the projections and other forward-looking statements in these materials.

© Canon Marketing Japan Inc. 2023