Securities code: 8060

Translation

Interim Report for the 52nd Business Term
January 1, 2019  June 30, 2019

CONTENTS

To Our Shareholders
Financial Highlights
Pick Up News
Environmental and Social Activities

Cover photo

Old City of Dubrovnik, Croatia
From the Canon Calendar 2019
“World Heritage Journey Sekaiisan woTazunete” by Kazuyoshi Nomachi
EOS 5Ds
EF24-105 mm F4L IS II USM
1/180 seconds f8 ISO320

To Our Shareholders

We will aim to increase sales
and income while improving
profitability by focusing on theIT Solutions business.

We take this opportunity to convey our sincerest appreciation to all our shareholders for theircontinued support.
During the interim period under review, net sales of the Canon MJ Group increased only slightly
because existing businesses such as digital cameras and business equipment, which are sluggish,
declined significantly, although the IT Solutions business, on which the Group has been focusing asa growth driver, developed considerably coupled with the market growth. Meanwhile, operating
income increased significantly year on year as a result of increasing the profitability of the IT
Solutions business and switching to a leaner organization by continuing to reduce costs.
We expect the market environment for cameras and printers to remain tough in the second halfof the current fiscal year. While it appears unlikely that overall sales will increase significantly, wewill nevertheless aim to increase sales and income while improving profitability by continuing tofocus on the IT Solutions business.
We plan to pay interim dividends of 30 yen per share (an increase of 5 yen year on year) andannual dividends of 60 yen per share (the same as in the previous fiscal year) without changing fromthe amount announced at the beginning of the period.As we pursue these initiatives, we sincerely
ask for your continued support.
August 2019

Masahiro Sakata
President & Representative Director

The reporting segments of Canon MJ have been changed in the current fiscal year, and the changes mentioned in
the following text are based on a comparison with the interim period of the previous fiscal year by changing thereporting segments into those after the reclassification. Because the figure totaling net sales in each segment does
not include the amount in “Other,” it is different from net sales in the center of the pie chart. The composition
ratios are calculated based on the simple total of net sales in each segment. *“Other” consists of call centers, thebusiness process outsourcing (BPO) service business and the elimination of intersegment transactions.

Financial Highlights(Figures are rounded to the nearest unit)

Professional

Consumers

23.2 billion yen
Operating income  1.3 billion yen
Net sales 7%

18%

Overview Net sales declined due to theweak performance of Production
Printing, while sales of Healthcare
remained flat.

57.7 billion yen
Operating income  -0.3 billion yen
Net sales Overview Net sales decreased due to afall in sales of interchangeable lensdigital cameras.

Net sales

302.9

43%

billion yen

32%

Area

132.8 billion yen
Operating income  7.0 billion yen

Enterprise

98.7 billion yen
Operating income  5.5 billion yen

Net sales Net sales Overview Net sales increased thanks
to a rise in sales of IT solutions tosmall and medium enterprises,
although sales of major businessequipment declined.

Overview Net sales increased because
sales of IT solutions such as SI
services and IT infrastructureservices remained strong.

Other*Net sales 
Operating income -9.6 billion yen-0.1 billion yen(Billions of yen, rounded to the nearest unit)

Net salesInterim period

632.2

303.7

2017

Fiscal year

621.6

300.5

2018

Operating income
Fiscal year forecast

Interim period

622.0

30.4

(Forecast)

302.9

2019

11.0
2017

Fiscal year

28.9

9.7
2018

Fiscal year forecast

30.0(Forecast)

13.4

2019

Please see our IR Site for more detailed business results.

canon.jp/8060e-ir

P i ck U pNews

Launching iNSPiC ZV-123/CV-123,
an instant camera printer that enables users
to easily enjoy photography and printing

Canon MJ launched iNSPiC ZV-123/CV-123, a printer with a camera function that enables users to print
a photo immediately after taking it with the built-in camera. It is a highly portable palm-sized printer of asimilar size to a standard smartphone that enables users to easily enjoy photography and printing even when
they are away from home.

iNSPiC ZV-123 (Pearl white)

iNSPiC ZV-123 (Matte black)iNSPiC CV-123 (White)

Printingoa photo ut
instantlyon site

This product utilizes Zero Ink® Technology, and users can easily print out
photos on dedicated photo paper that combines paper and ink.
Because the paper is a sheet of stickers, users can paste it wherever theylike. They can also keep a record with photos in a notebook and create
message cards and original products by cutting and pasting photos.
iNSPiC ZV-123/CV-123 will expand new ways to enjoy photos withusers’ own ideas.
*Zero Ink® Technology is a trademark or registered trademark of ZINK HOLDINGS LLC.

eak dmrTo reco ura yo andof vel gintra ookc

To create
memorieswith yourfamily andfriends

POINT
When we introduced the new product, we discussed our overall marketing plan in the ichikara project, which isa cross-organizational marketing activity. This project mainly involves young female employees, who are the target
market for the product, and conducts activities by creating marketing plans utilizing the voices of the generation.
The members share information every day by keeping their eyes wide open so that their efforts to promote iNSPiC
in line with the trends by promptly reflecting market voices regarding how to use it in their marketing activities willlead to the development of new customer segments. These efforts include their focus on sales in stores dealing
with stationery and sundries to meet demand for using photos in a notebook.

2020
Sees the Arrival
Summerof a New Nishi-Tokyo Data
Center Building
Pick Up NewsA new Nishi-Tokyo Data Center building will commence
operation in 2020 to expand the stock-based IT service business.
Canon MJ and its subsidiary Canon IT Solutions Inc. began constructing the new Nishi-Tokyo Data
Center building on March 1, 2019 with the aim of commencing its operation in summer 2020.

Why is demand for data centers increasing?
We assume that you have probably noticed that information technology (IT) is developing in all areas of your life as
typified by the dissemination of online shopping and electronic money,
Strong increase in digital data due
along with the fact that a range of procedures are going online.
to the development of IT
Given that the labor force in Japan is decreasing due to the aging
population combined with the low birthrate, the labor shortage has
Aging population combined
become a serious challenge for companies, and demand for IT such aswith low birthrate
Development of IT in
Decrease in labor force
the automatization and streamlining of operations by IT is growing even
our lives, such as online
shopping, electronic money
further.
Automatization andand online procedures
streamlining of operations
Against this backdrop, created digital data are rapidly increasing.
at companies
In addition, the migration to the cloud, in which outside services areused and stored online via the Internet as data and software of individuals
and companies, which they previously used and stored themselves, is also
Data and software migration to the cloudprogressing rapidly.
Accordingly, data centers that can safely store and use a greater
volume of electronic data than ever before are required.
Canon MJ will expand the long-lasting stock-based IT service business such as data center services, cloud services and system
operation services by further strengthening the IT Infrastructure & Service Business with data centers at the core, in addition todata centers as a storage facility of important information assets of companies.

Status of Group IT Solutions To meet customers’ needs for streamlining operations using IT, the Canon MJ Group
provides optimum solutions to support their businesses, such as system development anddata center services for large companies and cloud services and security measures forsmall and medium enterprises. This IT Solutions business is an area in which Canon MJ
has been cultivating technologies and expertise through M&A, and we expect significant
growth in the future. The total net sales of Group IT solutions that are included in thenet sales of each segment for the interim period under review are 111.1 billion yen, anincrease of 14% year on year.

Net sales of Group IT solutions(Billions of yen, rounded to the nearest unit)

111.1

97.9
Comparison
with previous
period+14%

2018
Interim period

2019
Interim periodQ

The key words “ESG” and “SDGs” are attracting attention, but whatefforts are you making regarding social and environmental issues?
Related SDGs

Environmental and Social Contribution Activities
through the Collection of Toner Cartridges

Environmental contamination by plastic waste has become a major challenge in recent years.
In 1990, the Canon Group began collecting toner cartridges for the effective use of limited
resources and the reduction of waste. The Canon Group is now working to achieve a resource recycling society by reproducing
materials with a selection purity of 99% or more from used toner cartridges and using these materials in the manufacture of
new cartridges.
As an environmental activity that is unique to a marketing company, the Canon MJ Group is working on the reduction of CO2
emissions from collection itself through the “simultaneous-with-delivery collection service” for corporate customers and social
contribution activities linked to collection and recycling, in addition to the establishment of collection bases and the developmentof various collection routes nationwide.
1990

1993

Dedicated communal
collection box2003Bringing to thecollection window

Simultaneous-withdelivery collection

2005

2006
Bell mark collection
for schools

2020

Visiting collection

30thanniversary

NEWS!

Businessactivities
Businesswill lead
to CSRrequired by the times

The Canon MJ Group aims to provide products, services andsolutions that integrate “sustainability elements,” which can berephrased as requests and expectations of modern society, basedon the key concept that “CSR activities are marketing itself.”
We believe that the resolution of social issues and the provisionof social value through our business activities will lead to thesustainable, synergistic development of companies and societythat is not transient or intermittent.
We are developing CSR activities to create such new value
required by the times based on the slogan of “Business withCSR.”

Creation of value

Business with CSR ~ CSR activities to create the new value required by the times ~Social issues(sustainability elements)

Leading
CSR tobusinessBusiness with CSR = Business activities × Social issues

In the 22nd Environmental Management Survey conducted by Nikkei Inc., Canon MJ received high evaluation
marks in the items of “Environmental Management Promotion System” and “Resources Recycling” and was ranked
first in the non-manufacturing sector, the trading company section.

Change of Method of
Receiving Dividends

QI go to a post office whenever I receive dividends,
but can I receive dividends without going to a post office?

You can also receive dividends in your account at a bank or a securities company.
To receive dividends more safely and quickly, you are recommended to change your method of receiving dividends from receipt
using the dividend receipt to receipt in an account at a bank or a securities company.

For the procedure to change the method of receiving dividends,
If you have stocks at a securities company

Contact the securities company where you have opened a securities account.

If you do not have stocks at a securities company

Contact Mizuho Trust & Banking Co., Ltd. (0120-288-324).

Please take this opportunity to consider changing your method of receiving dividends.

Headquarters: 16-6, Konan 2-chome, Minato-ku, Tokyo 108-8011, Japan