July 26, 2017

Summary Report of Consolidated Financial Results
for the second quarter ended June 30, 2017

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 28, 2017
U.S. Accounting Standards Applied:No
1.Consolidated business results for the six months ended June 30, 2017 (From January 1, 2017 to June 30, 2017)(1) Consolidated Results of Operations

Six months ended

June 30, 2017
June 30, 2016

[Note] Comprehensive Income:Six months ended(Amounts less than one million yen are truncated)(Percentage represents increases or decreases from the previous year)

Net sales

Operating income

Millions of yen

303,657%

Millions of yen(2.5)

10,315(0.8)

306,236

10,961%Millions of yen

21.0

11,221

6.3

Millions of yen

5.4

8,375

17.1

%

26.1

6,641

30.8

Six months ended June 30, 2016 : 7,560 million yen [30.6%]
Basic earnings
Diluted earningsper shareper share
Yen

Yen

51.21

-64.59June 30, 2016-(2) Consolidated Financial Position
Total assets(Amounts less than one million yen are truncated)

Net assets

Millions of yen

477,524

Second quarter ended June 30, 2017
Year ended December 31, 2016%

11,829Six months ended June 30, 2017 : 7,397 million yen [(2.2)%]

June 30, 2017

[Reference] Shareholders' equity:

Profit attributableto owners of parent

Ordinary income

Equity ratio

Millions of yen%

284,461

497,727

280,919

Net asset per share
Yen

59.5

2,190.00

56.4

Second quarter ended June 30, 2017 : 283,976 million yen

2,162.96

Year ended December 31, 2016 : 280,472 million yen

2.Dividends
First quarter-end
Yen

Second quarter-end
Yen-

Year ended December 31, 2016

Year ending December 31, 2017

Third quarter-end
Yen

20.00

-

Year ending December 31, 2017

Dividend per share

25.00(forecast)Year-end

Annual

Yen

Yen-

30.00

50.00

-

25.00

50.00

[Note] Revision of cash dividend forecast for this period : Yes
3.Consolidated financial forecast for the fiscal year ending December 31, 2017
Net sales
Full yearMillions of yen

645,000[Note] Revision of forecast for this period : None%

2.5(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

28,800%

4.1

Millions of yen

Basic earnings per share is revised based on the change of the average number of shares.

-1-

29,600%

3.1

Millions of yen%

19,800 9.0

Yen

152.70* 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 : None

( ii ) Changes in accounting policies other than ( i ) :None( iv ) Retrospective restatement :None( iii ) Changes in accounting estimates :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, 2017 :As of December 31, 2016 :

151,079,972
151,079,972( ii ) Number of treasury stock at the end of the period
As of June 30, 2017 :As of December 31, 2016 :( iii ) Average number of shares
As of June 30, 2017 :As of June 30, 2016 :21,409,989
21,409,021

129,670,401
129,671,964* 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.

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Consolidated Quarterly Balance Sheets(Amounts less than one million yen are truncated)
As of December 31, 2016

As of June 30, 2017

AssetsCurrent assets

Cash and deposits

76,78554,65730,50030,500834

1,092

Notes and accounts receivable-trade124,475

Merchandise and finished goods

28,270

Securities

Work in process

Raw materials and supplies

98,442

25,910875

Deferred tax assets

743

4,214

Short-term loans receivable
Other

4,198

90,044

120,034

(121)

(124)

6,263

Allowance for doubtful accounts
Total current assets

7,759

362,141

343,214

Buildings and structures, net

47,42546,312Tools, furniture and fixtures, net

3,963

3,877

Non-current assets

Property, plant and equipment

Machinery, equipment and vehicles, net

147

Rental assets, net

138

10,574Land

10,81434,364

Leased assets, net

226Construction in progress

33,792-170
23

Total property, plant and equipment

96,701

Software

6,443

5,823

Right of using facilities

317

317

Total intangible assets

6,819

6,194

Investment securities

7,422

7,390

Intangible assets

Leased assets

53

Other

48

4

Investments and other assets
Long-term loans receivable

10

Net defined benefit asset
Deferred tax assets

17,668

Other

2,483

Guarantee deposits

4-

4,824

Allowance for doubtful accounts(344)

Total investments and other assets

32,064

Total non-current assets

135,585

Total assets

497,727-3-

95,128935618,097
5,021

2,437

(325)

32,987

134,310477,524

Consolidated Quarterly Balance Sheets(Amounts less than one million yen are truncated)
As of December 31, 2016

As of June 30, 2017

Liabilities

Current liabilities

Notes and accounts payable-trade102,66280,046

Accrued expenses

18,96815,528

Accrued consumption taxes

4,296

2,873

Lease obligations

175

Income taxes payable

4,689

Provision for bonuses

Provision for directors' bonuses

Provision for loss on order received

4,703

461

482

22,086

23,60523

Other

Total current liabilities

Non-current liabilities
Lease obligations

206

204

Accrued long service rewards for employees

961

653,568

Other

4,675

Total non-current liabilities

59,841

Total liabilities

1

132,282422

Net defined benefit liability

45

156,966

Deferred tax liabilities

Deferred tax liabilities for land revaluation

4,849

3,473

128

Provision for product warranties

146

442
6

1,015

54,362

4,749

60,780216,808

193,063

Capital stock

73,30373,303Retained earnings

163,363

167,848

Total shareholders' equity

287,571

292,055

2,3282,327

147

87

Net assets

Shareholders' equity
Capital surplus

82,820Treasury shares(31,914)

Accumulated other comprehensive income

Valuation difference on available-for-sale securities
Deferred gains or losses on hedges(14)

Foreign currency translation adjustment

Remeasurements of defined benefit plans

Total accumulated other comprehensive income

Total net assets

446

484

497,727-4-(13)(10,478)

280,919

Total liabilities and net assets(31,916)(9,560)(7,099)Non-controlling interests

82,820(8,078)284,461

477,524

Consolidated Quarterly Statements of Income(Amounts less than one million yen are truncated)

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

Net sales

Six months of FY2017(from January 1, 2017
to June 30, 2017)306,236

Cost of sales

303,657

196,292

Gross profit

195,896

109,943

Selling, general and administrative expenses

107,760

99,62896,798Operating income

10,315Interest income

127

Insurance income

596

539

1,138

1,011

8

6

Other

161

137

Ordinary income

11,221Non-operating income
Dividend income

10,961

82

98

Other87315

Total non-operating income

Non-operating expenses
Interest expenses

Foreign exchange losses

301

61

Total non-operating expenses

231

Extraordinary income

Gain on sales of non-current assets

143

11,829158

Gain on sales of investment securities
Other

0

Total extraordinary income

Extraordinary losses

Loss on sales and retirement of non-current assets

467
63183

212-100

Loss on disaster

16102

Total extraordinary losses

837
1,368

109

Other-159

Impairment loss

Special extra retirement payments

412

16328

Profit before income taxes

10,96812,868

Profit

6,659

8,384

Profit attributable to owners of parent

6,641

8,375

Income taxes

4,308

Profit attributable to non-controlling interests

18-5--

4,484
8-Consolidated Quarterly Statements of Comprehensive Income(Amounts less than one million yen are truncated)

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

Profit6,659

Other comprehensive income

Six months of FY2017(from January 1, 2017
to June 30, 2017)

8,384

Valuation difference on available-for-sale-securities

(583)

(1)

Foreign currency translation adjustment

(178)

(68)

Deferred gains or losses on hedges(42)

Remeasurements of defined benefit plans, net of tax
Total other comprehensive income

1,706(918)

7,560

7,397

7,537

7,396901

Comprehensive income

Comprehensive income attributable toComprehensive income attributable to owners of parent

Comprehensive income attributable to non-controlling interests

23-6-0(986)0Consolidated Quarterly Statements of Cash Flows(Amounts less than one million yen are truncated)

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

Cash flows from operating activities
Profit before income taxes

Six months of FY2017(from January 1, 2017
to June 30, 2017)

10,968Depreciation

12,8687,503

Impairment loss

7,059

109-

Amortization of goodwill

115

Increase (decrease) in net defined benefit liability

(643)

(725)

Increase (decrease) in provision for bonuses

1,749

1,229

Increase (decrease) in allowance for doubtful accounts(5)

Decrease (increase) in net defined benefit asset
Interest and dividend income-(225)

Interest expenses

8

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

16

Loss (gain) on sales of investment securities--(15)(174)(170)
6(626)(467)

Decrease (increase) in notes and accounts receivable-trade

28,051

Increase (decrease) in notes and accounts payable-trade(21,070)(22,615)

Subtotal

21,807

20,421

Decrease (increase) in inventories

492

Other, net(5,263)

Interest and dividends income received

233

Interest expenses paid

(11)

Income taxes paid

(6,240)26,015
2,193(4,157)169(6)(4,510)Net cash provided by (used in) operating activities

15,78816,074Purchase of property, plant and equipment(4,978)(5,854)

Cash flows from investing activities

Proceeds from sales of property, plant and equipment

712

Purchase of intangible assets(749)

Purchase of investment securities

1,990(600)

(190)

(162)

Net decrease (increase) in short-term loans receivable(9,990)(29,989)

Net cash provided by (used in) investing activities(15,051)(34,213)

(125)

(103)

(3,240)(3,886)-49

Proceeds from sales of investment securities

0

Other, net

143

Cash flows from financing activities

Repayments of finance lease obligations
Purchase of treasury shares(1)

Cash dividends paidDividends paid to non-controlling shareholders(10)

Proceeds from share issuance to non-controlling shareholders
Other, net-Net cash provided by (used in) financing activities

Effect of exchange rate change on cash and cash equivalents
Cash and cash equivalents at beginning of period(12)0(2,801)(22,128)

96,771-7-(2)(3,955)99,573

Cash and cash equivalents at end of period(229)(3,377)(161)

Net increase (decrease) in cash and cash equivalents

634

(34)

107,285

85,157

Consolidated Quarterly Segment Information
I. Six months of FY2016 (from January 1, 2016 to June 30, 2016)
Information on net sales and income (loss) by reportable segment.
BusinessSolutions

ITSolutions

Imaging
SystemIndustrial /Medical

Sales - external customers

167,453

53,10468,07817,585

Total

167,453

66,12868,078Net sales

Sales - intersegment
Operating income

-

5,409

13,023
2,138

-

1,734

(Amounts less than one million yen are truncated)

Other

13-

17,585
746

13-

285

Total

Adjustment Consolidated

306,236-306,236(13,023)

306,236

13,023(13,023)

10,315-319,259[Note]
1. "Other" includes businesses, such as shared service businesses, which are not inluded in other reportable segments.
2. "Operating income" is equal to the "Operating income" of "Consolidated Quarterly Statements of Income."-10,315

II. Six months of FY2017 (from January 1, 2017 to June 30, 2017)
Information on net sales and income (loss) by reportable segment.
Business
Solutions

Net sales

Sales - external customers

170,926

Total

170,926

Sales - intersegment
Operating income

5,875

-IT
Solutions

ImagingSystem

52,00764,49365,50764,493

13,4992,103(Amounts less than one million yen are truncated)Industrial /Medical-

2,093

16,211Other-

16,211
707

Total1616

181-

303,657

Adjustment Consolidated-

303,657(13,499)

303,657

13,499(13,499)

10,961-

317,156[Note]
1. "Other" includes businesses, such as shared service businesses, which are not inluded in other reportable segments.
2. "Operating income" is equal to the "Operating income" of "Consolidated Quarterly Statements of Income."*NOTE*

10,961

Canon Biz Attenda Inc. and A&A Co., Ltd. , which were previously included in "IT Solutions" segment, are included in"Business Solutions" segment and Canon ITS Medical Inc., which was previously included in "IT Solutions" segment, isincluded in "Industrial / Medical" segment starting from the current fiscal year. The segment information for the previous
fiscal year is disclosed after reclassifying the figures in accordance with the new reportable segments mentioned above.

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