FY2024 2Q

Consolidated Results
July 24, 2024
Hatsumi Hirukawa
Director, Senior Vice President* The figures are rounded off to the nearest 100 million yen in this material.
* Forward-looking statements and results forecasts presented in this material are based on the management’s assumptions using currently available information and therefore contain inherent risks
and uncertainties. As a consequence, due to a range of possible factors, actual results may materially differ from the forecasts.
© Canon Marketing Japan Inc. 2024

1

Agenda Key Points

P.3

 Summary of Results

P.4, 7

 Operating Income Variance Analysis

P.5, 8

 Results by Segment

P.6, 9 Segment Results

P.10-13

 Sales of Products and Services by Segment

P.14-15

 Summary of Forecasts

P.16

 Forecasts by Segment

P.17-19

 Segment Forecasts

P.20-21

 【Supplementary Material】 Outline of Main Products Sales

P.22

 Tender Offer for Own Shares

P.23

 Supplementary Information

P.26-41© Canon Marketing Japan Inc. 20242

Now we will explain the results for the second quarter of FY2024 and the forecasts.
We will proceed with the briefing based on this agenda.

Key Points
Summary of 2Q of FY2024 Financial Results• Net sales and income increased year on year.
• IT Solutions business continued to grow at a high rate. Sales rose 21% year on year.
• Net income attributable to owners of the parent surpassed previous record highs forboth Q2 results and the first half results on a yearly basis.
2024 Financial Forecasts• The net sales forecast is revised upward by 5 billion yen, in view of brisk sales in the
IT solutions business in the Enterprise segment.
• The Group will aim to attain the 2025 net sales target of 650 billion yen within thisyear, one year ahead of schedule.
Topics• The Company resolved to Tender Offer for own shares (22,000,000shares).
© Canon Marketing Japan Inc. 2024

3

On the third page, I will review the key points of the second quarter results.
For the second quarter, net sales and income figures rose on a year-on-year basis.
IT solutions continued its strong performance, managing to realize its high growth rate with anincrease of 21% year on year.
In addition, we posted extraordinary income from the transfer of shares in A&A Co., Ltd. Meanwhile,
net income for the second quarter and that for the first half hit both reached new highs.
As for the full-year forecasts, net sales forecast has been revised upward by ¥5.0 billion, in view ofbrisk sales of IT solutions in the Enterprise segment.
Based on this revision, we will aim to achieve the 2025 targets of ¥650 billion for the Group's net
sales and ¥300 billion for the IT solutions business sales within this year, one year ahead of schedule.
We have revised upward the operating income to ¥50 billion and ROE to 8% and achieved them todate. Having accomplished the targets for the Group's net sales and the IT solutions business sales
additionally, we will be able to complete all of the KPIs for 2025.
The Board of Directors meeting that took place earlier today adopted a resolution to conduct a Tender
Offer for own shares.
Regarding this matter, Mr. Osato, who is in charge of group finance and accounting, will be briefing
you at the end.

2Q 2024 Actual(from April 1 to June 30)

Summary of Results

 Net income attributable to owners of the parent surpassed previous quarterly record highs.
(Billions of yen)

Net Sales

Gross Profit

Operating income

Ordinary income
Net income attributable toowners of the parent© Canon Marketing Japan Inc. 2024

2Q
FY2023

Changes

2Q
FY2024

Amount

148.0

161.7

+13.7

(33.7％)(32.3％)(-1.4％)

49.8

52.2

+2.3

(8.0％)(7.6％)(-0.4％)

11.8

12.2

+0.4

(8.4％)(8.1％)(-0.3％)

12.4

13.0

+0.6

(5.6％)(6.6％)(+1.0％)

8.2

10.6

+2.4

%

+9％

+5％
+4％
+5％
+29％

4

The fourth page shows a summary of the results for the second quarter.
As already noted, net sales and income figures rose for the second quarter. Net income attributable toowners of the parent exceeded ¥10 billion, to achieve a new high for the second quarter.
Net sales grew 9% year on year to ¥161.7 billion. This chiefly reflects the inclusion of net sales of
TCS Inc., which joined the Group last October, and continued strong sales of IT solutions.
Operating income recorded a ¥0.4 billion year-on-year jump to ¥12.2 billion, benefitting from higher
gross profit due to increased sales.
Net income attributable to owners of the parent increased by ¥2.4 billion to ¥10.6 billion.

Operating Income Variance Analysis+4.6

2Q 2024 Actual(from April 1 to June 30)(Billions of yen)

-2.3
-1.9

12.2

11.8

2Q FY2023

Increase in
net sales

Deterioration in
GP margin

2Q FY2024

Increase in SG&A expenses

Deterioration in GP margin• IT expenses• Amortization of goodwill, etc.
• Other selling expenses• Gross profit margin declined mainly in theConsumers, Enterprise and Area segments© Canon Marketing Japan Inc. 2024

Increase in
SG&A expenses

+0.4B
+0.9B
+0.6B

5

The fifth page shows an analysis of operating income for the second quarter.
Due to the rise in net sales, gross profit increased by ¥4.6 billion.
The gross profit margin tumbled ¥2.3 billion. This is explained partly by a reactionary fall following theeffect of a new product release in the Consumers segment in the same period a year earlier, and by
PC sales growth in the Enterprise segment and in the Area segment. Margins on PCs themselves are
low, but we continue to propose a range of associated profitable services, such as maintenance andoperation services.
Selling, general and administrative expenses increased ¥1.9 billion, due mainly to a rise in goodwill
and other amortization and a surge in IT expenses associated with the renovation of mission-criticalsystems and other factors.
For details about selling, general and administrative expenses for the second quarter, please see the
SG&A Expenses on page 27.

2Q 2024 Actual(from April 1 to June 30)

Results by Segment(Billions of yen)

2Q
FY2023
Net sales

Consumers

Enterprise

Area
Professional
Other
Total

2Q
FY2024

Op. income

Net sales

Changes

Op. income

Net sales

Op. income

33.7

3.4

34.0

3.1

+0.3

-0.3

52.9

4.0

60.6

4.5

+7.7

+0.5

56.7

4.2

57.1

4.4

+0.4

+0.2

10.2

0.9

10.9

1.4

+0.7

+0.5

-5.5

-0.7

-0.9

-1.2

+4.6

-0.5

148.0

11.8

161.7

12.2

+13.7

+0.4

* "Other" includes elimination of intersegment transactions, shared service businesses and corporate expenses that are not allocated to each segment.
* One of the organizations of sales channels in the Area segment was transferred to the Consumers segment in FY2024. As a result, the FY 2023 financial results
have been reclassified between the two segments© Canon Marketing Japan Inc. 2024

6

The sixth page shows the summary of the results for the second quarter by segment.
Net sales grew in all segments.
The figure in the Other segment also rose after net sales of Primagest, Inc., which joined the Groupon March 29, were taken into account.
Operating income decreased in the Consumers segment, while it rose in the Enterprise, Area andProfessional segments.
Because of goodwill and other amortization, operating income in the Other segment decreased, but
Primagest has performed solidly.
Later, I will explain the details of the financial results by segment.

1Q-2Q 2024 Actual(from January 1 to June 30)

Summary of Results

 Net income attributable to owners of the parent surpassed previous quarterly record highs.
(Billions of yen)

Net Sales

Gross Profit

Operating income

Ordinary income
Net income attributable toowners of the parent© Canon Marketing Japan Inc. 2024

1Q-2Q
FY2023

Changes

1Q-2Q
FY2024

Amount

302.8

318.9

+16.1

(33.7％)(32.4％)(-1.3％)

102.0

103.4

+1.4

(8.9％)(8.2％)(-0.8％)

27.1

26.0

-1.1

(9.2％)(8.5％)(-0.7％)

27.9

27.0

-0.9

(6.2％)(6.3％)(+0.2％)

18.7

20.1

+1.5

%

+5％

+1％
-4％
-3％
+8％

7

On the seventh and subsequent pages show year-to-date financial results.
For the first half of 2024,
net sales grew, reflecting strong sales of IT solutions. Meanwhile, operating income fell due to a slidein the gross margin and a surge in selling, general and administrative expenses.
Net income attributable to owners of the parent increased after the posting of extraordinary income
associated with the transfer of A&A shares. It surpassed ¥20 billion and rose to a record quarterly
high and a record half-year high.

Operating Income Variance Analysis+5.4

1Q-2Q 2024 Actual(from January 1 to June 30)-4.0(Billions of yen)

-2.5

27.1

1Q-2Q FY2023

26.0

Increase in
net sales

Deterioration in
GP margin

Increase in
SG&A expenses

1Q-2Q FY2024

Deterioration in GP margin

Increase in SG&A expenses• Gross profit margin declined mainly in theConsumers, Enterprise and Professional
segments• IT expenses• Amortization of goodwill, etc.
• Other selling expenses© Canon Marketing Japan Inc. 2024

+0.9B
+1.0B
+1.2B

8

The eighth page presents an analysis of operating income for the first half.
Due to the rise in net sales, gross profit increased by ¥5.4 billion.
The gross margin declined sharply. This is explained by a reactionary fall following the effect of a new
product release in the Consumers segment in the same period a year earlier, and by the larger shareof the Healthcare business in the Professional segment.
The Healthcare business is engaged mainly in system integration services. Expenses for systemengineers are incorporated into the cost of sales, and not into selling, general and administrative
expenses. This means that the gross margin is lower in this business than in the Production Printing
business and in the Industrial Equipment business within the Professional segment.
Selling, general and administrative expenses increased ¥2.5 billion. This reflects a rise in goodwill
and other amortization, soaring IT expenses chiefly for the renovation of mission-critical systems, anda surge in other direct selling expenses and others associated with Primagest's participation in theGroup.
For details about selling, general and administrative expenses for the first half, please refer to the
SG&A Expenses on page 28.

1Q-2Q 2024 Actual(from January 1 to June 30)

Results by Segment(Billions of yen)

1Q-2Q
FY2023
Net sales

Consumers
Enterprise
Area
Professional
Other
Total

1Q-2Q
FY2024

Op. income

Net sales

Changes

Op. income

Net sales

Op. income

66.3

6.6

64.1

5.2

-2.2

-1.4

107.5

9.9

119.6

10.0

+12.1

+0.1

116.5

8.9

116.9

9.6

+0.4

+0.7

22.0

2.9

24.9

3.2

+2.9

+0.3

-9.5

-1.1

-6.5

-1.9

+2.9

-0.8

302.8

27.1

318.9

26.0

+16.1

-1.1

* "Other" includes elimination of intersegment transactions, shared service businesses and corporate expenses that are not allocated to each segment.
* One of the organizations of sales channels in the Area segment was transferred to the Consumers segment in FY2024. As a result, the FY 2023 financial results
have been reclassified between the two segments© Canon Marketing Japan Inc. 2024

9

The ninth page shows the summary of the results for the first half by segment.
Sales decreased in the Consumers segment,
while sales rose in the Enterprise, Area and Professional segments.
Operating income decreased in the Consumers segment,
while it rose in the Enterprise, Area and Professional segments.

Segment Results
ConsumersConsumers Segment

Net sales grew after a rise in sales of IT products and other factors.
Operating income dropped due to a decline in gross profit reflecting weaker sales of high-value added
products.
(Billions of yen)

2Q
Enterprise

FY2023

1Q-2Q

FY2024

Changes

FY2023

FY2024

Changes

Net Sales

33.7

34.0

+1％

66.3

64.1

-3％

Op. income

3.4

3.1

-10％

6.6

5.2

-21％

10.2％

9.1％

-1.1％

9.9％

8.1％

-1.8％

marginArea* One of the organizations of sales channels in the Area segment was transferred to the Consumers segment from FY2024. As a result, the FY 2023 financial results have been reclassified
between the two segments.

■Consumer Products, Y/Y Non-consolidated
Professional

Digital Interchangeable Lens Camera
Inkjet Printer (IJP)IJP Cartridge

1Q

2Q

Unit

-31%

-14%

Unit

-8%

-4%

Amount-9%-6%© Canon Marketing Japan Inc. 2024

3Q

4Q

Full year10

On the tenth and subsequent pages, I will explain results by segment.
First, we are looking at the Consumers segment.
Net sales for the second quarter climbed 1% year on year to ¥34.0 billion, chiefly reflecting the brisk
performance of IT products, which offset sales declines in digital interchangeable lens cameras and ininkjet printers.
Operating income decreased ¥0.3 billion year on year to ¥3.1 billion. This resulted from a fall in grossprofit following the decline in sales of digital interchangeable lens cameras and inkjet printers.
(Digital interchangeable lens cameras)
Unit sales of digital interchangeable lens cameras were down 14% from the previous year due to theabsence of the sales increase produced by the launch of new products in the same period of theprevious year.
Sales of interchangeable-lens rose sharply as sales for replacement with RF mount models
proceeded amid the quick shift to the EOS R series.
(Inkjet printers)
Sales volume of inkjet printers was down 4% from the previous year, reflecting a contraction of themarket, etc.
Sales of ink cartridges decreased, mainly reflecting a decline in printing volume.
(IT products)
Sales of IT products increased significantly, reflecting continued growth in sales of high-performance
PCs and PC peripherals.

Segment Results
ConsumersEnterprise Segment

Net sales were up, reflecting the brisk performance of IT solutions despite sales of Canon Products, other staying flat.
Operating income increased, reflecting a rise in gross profit due to higher sales.
(Billions of yen)

2Q
FY2023

1Q-2Q

FY2024

Changes

FY2023

FY2024

ChangesEnterprise
Area

Canon products,
other

14.5

14.5

-0％

29.2

29.6

+1％

IT solutions

38.3

46.0

+20％

78.3

90.0

+15％

Net sales

52.9

60.6

+15％

107.5

119.6

+11％

OP. income

4.0

4.5

+13％

9.9

10.0

+2％

7.5％

7.4％

-0.1％

9.2％

8.4％

-0.8％

margin[Reference] Results of main consolidated company
Professional

Canon IT Solutions Inc.
2Q

Changes

FY2023

FY2024

Net sales

31.3

37.6

Op. income

2.9

3.6

© Canon Marketing Japan Inc. 2024

%

1Q-2Q

Changes%2Q orders received excluding
Canon IT Solutions Inc.
Orders received and outstanding orders, Y/Y Non-consolidated the Data Center businesssurpassed previous quarterly
Full
1Q
2Q
3Q
4Q record highs.
year

FY2023

FY2024

+20％

62.8

70.8

+13％

Orders received

+1%

+13%

+24％

6.8

7.6

+12％

Outstanding orders

-7%

-10％

2Q outstanding orders excluding theData Center business surpassed
previous quarterly record highs.

11

On the eleventh page, I will explain the Enterprise segment.
For the second quarter, net sales increased 15% year on year to ¥60.6 billion, thanks to the solid
performance of IT solutions, although sales of Canon products, other were flat.
Operating income recorded a ¥0.5 billion year-on-year jump to ¥4.5 billion, benefitting from higher grossprofit due to increased sales.
(Canon products, other)
Among Canon products, other, the number of office MFPs sold increased as we received a number oflarge projects. Meanwhile, the number of LBPs sold decreased, for two reasons. First, large projects thatwere ongoing in the same period of the previous year have ended. And second, some projects were
postponed to the third or subsequent quarters. Sales of maintenance services for office MFPs fell slightly
due to reduced printing volume in offices. Sales of LBP cartridges grew, because sales to specificindustries were robust. As a result of all these, net sales for Canon products, other overall remained
unchanged year on year.
(IT solutions)
In IT solutions, sales grew based on a number of factors, such as brisk sales of system integration
projects for financial businesses and manufacturers, the acquisition of a large project in the education
sector, and TCS' participation in the Group.
As a result, net sales for the whole IT solutions increased 20% year on year.
[Results, orders received and outstanding orders for Canon IT Solutions Inc.]
Sales at Canon IT Solutions Inc., a key affiliate, increased 20% year on year to ¥37.6 billion.
Operating income recorded a ¥0.7 billion year-on-year jump to ¥3.6 billion, benefitting from higher grossprofit due to increased sales.
Orders received were up 13% year on year. The factors for the increase includes strong sales of system
integration projects for manufacturers and the acquisition of a large project for PCs in the education
sector.
Orders received excluding those in the Data Center business set a new quarterly high.
Outstanding orders declined 10% year on year, in part due to a switch of sales to large data center
projects, despite strong performance with system integration projects and major PC projects.
Outstanding orders excluding those in the Data Center business were strong, rising to a new quarterly
record high.

Segment Results
ConsumersArea Segment

Net sales hiked. While sales of Canon products, other dropped slightly, those of IT solutions were buoyant.
Operating income surged. While gross profit fell after the transfer of shares of A&A Co., Ltd., selling, general andadministrative expenses, including personnel expenses, also decreased.
(Billions of yen)
2Q
FY2023

1Q-2Q

FY2024

Changes

FY2023

FY2024

ChangesEnterprise
Area

Canon products,
other

39.7

39.4

-1％

80.5

79.3

-2％

IT solutions

17.0

17.7

+4％

36.0

37.6

+5％

Net sales

56.7

57.1

+1％

116.5

116.9

+0％

Op. income

4.2

4.4

+5％

8.9

9.6

+8％

7.4％

7.7％

+0.3％

7.6％

8.2％

+0.6％

margin* One of the organizations of sales channels in the Area segment was transferred to the Consumers segment from FY2024. As a result, the FY 2023 financial results have been reclassified
between the two segments.

Professional[Reference] Results of main consolidated company© Canon Marketing Japan Inc. 2024

Canon System & Support Inc.
2Q

Changes

FY2023

FY2024

Net sales

25.7

26.1

Op. income

1.2

1.2

%

1Q-2Q

Changes

FY2023

FY2024

+2％

52.5

54.4

%
+4％

+2％

3.0

3.4

+16％

12

On the twelfth page, I will explain the Area segment.
We transferred shares of A&A Co., Ltd. on May 1, 2024. Prior to that, it was part of the Area segment.
In connection with this share transfer, the figures for May 2024 and later are smaller by the portion
contributed by A&A.
For the second quarter, net sales surged 1% year on year to ¥57.1 billion, following the solid
performance in IT solutions, which offset a slight drop in sales of Canon products, others.
Operating income rose ¥0.2 billion year on year, to ¥4.4 billion. While gross profit declined following
the transfer of A&A shares, the contraction of personnel expenses and other selling, general andadministrative expenses led to the earnings growth.
(Canon products, other)
With respect to Canon products, other, the number of office MFPs sold declined. This reflected areactionary drop from the sharp rise in the number sold in the same period a year earlier following therecovery of product supply. The number of LBPs sold decreased after the end of several large lot
projects that existed in the same period in the previous year.
Sales of maintenance services for office MFPs fell slightly due to reduced printing volume in offices.
Net sales of LBP cartridges rose, in part from the effects of price revisions implemented in February
2023 in response to rising purchase prices.
As a consequence, net sales of the Canon products, other as a whole declined slightly.
(IT solutions)
In IT solutions, business PCs were increasingly replaced, which is associated with the expiration of
Windows 10 extended support. In addition, Canon System & Support Inc. continued to offer proposals
on digitalization for enhanced productivity, solutions for compliance with revisions to laws and tax
systems, the use of IT introduction subsidies, among other proposals, to achieve solid sales of
mission-critical operation software and the Makasete IT DX series.
As a result of these efforts, net sales for IT solutions overall were up 4% year on year, despite a sales
decrease due to the transfer of A&A shares.
[Results for Canon System & Support Inc.]
Net sales for Canon System & Support Inc., a key affiliate, rose 2% year on year to ¥26.1 billion.
As noted earlier, operating income increased ¥20 million to ¥1.2 billion, reflecting a higher gross profit
associated with increased sales owing to steady performance in IT solutions.

Segment Results
ConsumersProfessional Segment

Net sales increased after a sales rise of Industrial equipment.
Operating income increased, reflecting a rise in gross profit associated with higher sales in Industrial equipment.
2Q(Billions of yen)

FY2023

1Q-2Q

FY2024

Changes

FY2023

FY2024

ChangesEnterprise
Area

Production printing

2.5

2.3

-7％

4.6

4.6

-0％

Industrial equipment

3.7

5.6

+51％

9.5

11.0

+16％

Healthcare business

4.1

3.1

-25％

7.9

9.3

+18％

Net sales

10.2

10.9

+7％

22.0

24.9

+13％

Op. income

0.9

1.4

+52％

2.9

3.2

+11％

9.1％

13.0％

+3.9％

13.0％

12.7％

-0.3％

marginProfessional[Reference] Results of main consolidated company© Canon Marketing Japan Inc. 2024

Canon Production Printing Systems Inc.
2Q

Changes

FY2023

FY2024

Net sales

2.3

2.1

Op. income

0.2

0.1

%

1Q-2Q

Changes

FY2023

FY2024

-9％

4.3

4.3

%
-1％

-23％

0.2

0.2

-28％

13

On the thirteenth page, I will explain the Professional segment
Net sales for the second quarter increased 7% year on year to ¥10.9 billion, following sales growth inIndustrial Equipment.
Operating income recorded a ¥0.5 billion year-on-year jump to ¥1.4 billion, benefitting from higher
gross profit due to increased sales of industrial equipment.
(Production printing)Sales of production printing were down 7% year on year due to the absence of projects for print
management systems that were present in the same period of the previous year.
[Results at Canon Production Printing Systems Inc.]
Net sales for Canon Production Printing Systems Inc., a main affiliate, fell 9% year on year, to ¥2.1
billion. Operating income declined ¥30 million year on year to ¥0.1 billion.
(Industrial equipment)
In industrial equipment, increased the number of projects of semiconductor-related equipment andother equipment drove a 51% year-on-year increase in net sales.
(Healthcare business)
In Healthcare, net sales declined 25% year on year. This reflects the fact that the year-ago period
included several projects for hospitals and projects for online insurance eligibility verification systems
for clinics, while there were no such projects during the period in question.

Sales of Products and Services by Segment
Consumers(Billions of yen)

SI services

2Q
FY20242Q
FY20232Q
FY20242Q
FY20232Q
FY20242Q
FY20232Q
FY2024

－

－

17.7

19.3

2.8

2.4

4.1

3.1

-0.6

-0.5

24.1

24.4

－

－

+9％
10.0

7.7

9.2

9.2

10.6

24.8

38.3

34.0
+1％

14.3

46.0

14.5

14.5

11.5

60.6
+15％

0.4

12.5

17.0

17.7

－

39.4

4.5

57.1
+1％

－

-1.1

3.5

5.8

7.5

10.9

12.4

-3.2

-1.2

28.7

2.3

65.1

+7％

25％

34.8

44％

78.7

100%

+21％

-3.1

-0.9

19.5

+21％

82.8

-5.5

31％

+58％

-

+29％
10.2

3.9

-2.3

2Q
FY2024

+1％

-

-22％

-1％
56.7

-0.6

-

+4％
39.7

0.3

-

-6％

+8％

-0％
52.9

2.8

-23％

+7％

+20％

-5％
33.7

2.6

+35％

+20％
26.0

12.5

-15％

+25％

+20％

Changes

Changes

Ratio

2Q
FY2023

Changes

Total

Composition

Total

2Q
FY2024

7.7

Canon products, other

Other

2Q
FY2023

Changes

IT solutions

Professional

2Q
FY2024

Changes

IT products andsystem sales

Area

2Q
FY2023

Changes

Maintenance andoperation
service/outsourcing

Enterprise

2Q 2024 Actual(from April 1 to June 30)

83.0
+0％

148.0

-

161.7
+9％

* “Other” is a business segment that is not included in the reportable segments and includes the shared service business and elimination of intersegment transactions. One of the organizations of sales
channels in the Area segment was transferred to the Consumers segment from FY2024. As a result, the FY 2023 financial results have been reclassified between the two segments.
© Canon Marketing Japan Inc. 2024

14

The fourteenth page shows net sales for products and services by segment.
Here I will explain the second quarter results for IT solutions.
In SI services, sales increased 1% year on year. Despite a decline in sales in the Area segment
following the A&A share transfer and the end of several projects for hospitals that were present in thesame period of the previous year in the Professional segment, system integration projects for financial
businesses and for manufacturers brought buoyant sales to the Enterprise segment.
In Maintenance and operation service / outsourcing, sales jumped 58% year on year. This ismainly due to TCS joining the Group and the solid performance of cloud services in the Enterprisesegment. Also, Primagest joining the Group in the Other segment contributed to this increase.
In IT products and system sales, sales rose 21% year on year. The Consumers segment saw a risein sales of high performance PCs and PC peripherals. In the Enterprise segment and in the Area
segment, PC sales rose sharply.
As a result, net sales for the whole Group IT solutions increased 21% year on year.

Sales of Products and Services by Segment
Consumers(Billions of yen)

SI services

1Q-2Q
FY2023

1Q-2Q
FY2024

1Q-2Q
FY2023

－

－

35.2

-

Changes

Maintenance andoperation
service/outsourcing

－

15.1

15.1

51.2

Changes

21.4

17.5

46.6

66.3

64.1
-3％

1Q-2Q
FY2023

38.1

6.0

27.0

24.9

78.3

90.0

29.6

119.6
+11％

1Q-2Q
FY2023

6.0

7.9

5.7

24.7

25.9

0.7

37.6

－

79.3

8.6

116.9
+0％

1Q-2Q
FY2023

9.4

-1.2

-1.2

47.8

-1.3

－

10.0

13.4

14.8

24.9
+13％

52.3

-0.8

-2.5

26.4

36.6

-0.4

60.4

-6.1

65.8

134.6

154.7

-6.5

42％

100%

+15％
168.2

164.2

-9.5

24％

+9％

-6.2

34％

+39％

-3.3

1Q-2Q
FY2024

+9％

-

+11％
22.0

3.3

Ratio

1Q-2Q
FY2024

-

+17％

-2％
116.5

1Q-2Q
FY2024

-

+5％
80.5

1Q-2Q
FY20230.7

Composition

Total

1Q-2Q
FY2024

-4％

+5％
36.0

Other

+19％

+8％

+1％
107.5

1Q-2Q
FY2024

5.3

+15％
29.2

Professional

+0％

+16％

-9％

Changes

Total

17.5

1Q-2Q
FY2024+25％+16％

ChangesCanon products, other

21.7

+16％

Changes

IT solutions

－

Area

+8％

-

Changes

IT products andsystem sales

Enterprise

1Q-2Q 2024 Actual(from January 1 to June 30)

-2％
302.8

318.9

-

+5％

* “Other” is a business segment that is not included in the reportable segments and includes the shared service business and elimination of intersegment transactions. One of the organizations of sales
channels in the Area segment was transferred to the Consumers segment from FY2024. As a result, the FY 2023 financial results have been reclassified between the two segments.
© Canon Marketing Japan Inc. 2024

15

The fifteenth page shows overall sales of IT solutions for the first six months of the year.
Total sales of the Group's IT solutions rose 15% year on year.
Strong sales were achieved in SI services and in IT products and system sales.
The participation of TCS and Primagest in the Group resulted in a solid performance in Maintenanceand operation service / outsourcing.

Previous Forecast vs
Current Forecast

Summary of Forecasts(Billions of yen)

FY2024Previous
forecast

FY2024Current
forecast

ChangesAmountFY2023
Actual%ChangesAmount

%

609.5

+40.5

+7％

(8.6％)(-0.3％)

52.5

+1.5

(8.8％)(-0.3％)

53.6

+1.4

(6.0％)(-0.2％)

36.5

+1.0

Net sales

Operating income

Ordinary income

Net income attributableto owners of the parent

645.0

650.0

+5.0

(8.4％)(8.3％)(-0.1％)

54.0

54.0

－

(8.5％)(8.5％)(-0.1％)

55.0

55.0

－

(5.8％)(5.8％)(-0.0％)

37.5

37.5

－

© Canon Marketing Japan Inc. 2024

+1％

－

－

－

+3％

+3％

+3％

16

The sixteenth page shows a summary of forecasts.
For the first half of the current year, both sales and income increased. Their progress was faster thanplanned.
From the third quarter onward, we project a gradual recovery of the domestic economy, including
increased capital investment with a focus on proactive corporate investment in IT.
The Group will continue to bolster the profitability of Canon products business and to improve sales
as well as profitability in the IT solution business, which we have defined as a growth business, as it
seeks to boost annual sales and income.
Under these circumstances, we revised our net sales forecast upwards by ¥5 billion, given that theperformance of IT products and system sales was stronger than the forecast following the acquisitionof a large PC project for the education sector in the Enterprise segment.
With this revision, we expect to achieve the 2025 targets in the Long-Term Management Objectives(2021-2025) of ¥650 billion in net sales and ¥300 billion in IT solution sales one year ahead ofschedule.
Looking at operating income, we retain our target of achieving a new record high for four consecutive
years, although the situation is somewhat uncertain due to goodwill amortization and other expenses
associated with Primagest and other factors.

Previous Forecast vs
Current Forecast

Forecasts by Segment(Billions of yen)Consumers
Enterprise
Area
Professional
Other
Total

FY2024Previous forecast

FY2024Current forecast

Net
sales

Net
sales

Op.
incomeOp.
incomeChanges
Net sales
AmountOp.
income

%

139.3

13.7

139.3

13.7

－

－

－

231.2

20.5

236.2

20.5

+5.0

+2％

－

235.0

18.3

235.0

18.3

－

－

－

44.0

4.1

44.0

4.1

－

－

－

-4.5

-2.6

-4.5

-2.6

－

－

－

645.0

54.0

650.0

54.0

+5.0

+1％

－

* "Other" includes elimination of intersegment transactions, shared service businesses and corporate expenses that are not allocated to each segment.
© Canon Marketing Japan Inc. 2024

17

The seventeenth page shows forecasts by segment.
As noted, we have made an upward revision to the net sales forecast of ¥5 billion, in view of theperformance in IT product and system sales in the Enterprise segment, which was higher than initiallyprojected.

Previous Forecast vs
Current Forecast

Forecasts by Segment(Billions of yen)

FY2023
ActualNet
sales

Consumers
Enterprise
Area
Professional
Other
Total

FY2024Current forecast

Op.
income

Net
sales

Op.
incomeChanges
Net sales
AmountOp.
income

%

138.9

14.1

139.3

13.7

+0.4

+0％

-0.4

220.3

19.7

236.2

20.5

+15.9

+7％

+0.8

229.7

17.5

235.0

18.3

+5.3

+2％

+0.8

40.2

3.6

44.0

4.1

+3.8

+9％

+0.5

-19.7

-2.4

-4.5

-2.6

+15.2

－

-0.2

609.5

52.5

650.0

54.0

+40.5

+7％

+1.5

* "Other" includes elimination of intersegment transactions, shared service businesses and corporate expenses that are not allocated to each segment.
* One of the organizations of sales channels in the Area segment was transferred to the Consumers segment in FY2024. As a result, the FY 2023 financial results
have been reclassified between the two segments© Canon Marketing Japan Inc. 2024

18

The eighteenth page compares the forecasts by segment and results by segment for the previous
fiscal year.
In the Consumers segment, net sales are expected to rise, chiefly because IT products sales were
buoyant in the first half and we expect to boost sales of digital interchangeable lens cameras, withnew models set to be released in the second half.
On the other hand, operating income is forecast to shrink, given a decrease in gross profit following
first-half sales declines in digital interchangeable lens cameras and in inkjet printers, and a hike in IT,
advertising and other selling, general and administrative expenses.
We expect increased sales and profit in the Enterprise, Area and Professional segments.

1Q-2Q Actual and
3Q-4Q Forecast

Forecasts by Segment(Billions of yen)
FY2023

Changes

FY2024

1Q-2Q Actual

3Q-4Q Actual

1Q-2Q Actual

3Q-4Q Forecast

Net
sales

Net
sales

Net
sales

Net
sales

Op.
incomeOp.
incomeOp.
incomeOp.
income

1Q-2Q
Net
sales

3Q-4Q

Op.
income

Net
sales

Op.
incomeConsumers

66.3

6.6

72.6

7.5

64.1

5.2

75.2

8.5

-2.2

-1.4

+2.6

+1.0

Enterprise

107.5

9.9

112.8

9.8

119.6

10.0

116.6

10.5

+12.1

+0.1

+3.8

+0.7

Area

116.5

8.9

113.2

8.6

116.9

9.6

118.1

8.7

+0.4

+0.7

+4.9

+0.1

Professional

22.0

2.9

18.3

0.8

24.9

3.2

19.1

0.9

+2.9

+0.3

+0.9

+0.2

Other

-9.5

-1.1

-10.2

-1.3

-6.5

-1.9

2.0

-0.7

+2.9

-0.8

+12.3

+0.6

Total

302.8

27.1

306.7

25.4

318.9

26.0

331.1

28.0

+16.1

-1.1

+24.4

+2.6

* "Other" includes elimination of intersegment transactions, shared service businesses and corporate expenses that are not allocated to each segment.
* One of the organizations of sales channels in the Area segment was transferred to the Consumers segment from FY2024. As a result, the FY 2023 financial results
have been reclassified between the two segments.
© Canon Marketing Japan Inc. 2024

19

Page 19 includes a year-on-year comparison of the first half and forecasts for the second half bysegment.
Later, I will explain the details of the financial forecasts by segment.

Segment ForecastsConsumersConsumers(Billions of yen)

Net sales are forecast to increase due to steady sales of digital interchangeable lens cameras and IT products.
Operating income is expected to increase, reflecting a rise in gross profit due to higher sales.
FY2023

FY2024

ChangesEnterprise

1Q-2Q Actual

3Q-4Q Actual

1Q-2Q Actual

3Q-4Q Forecast

Net
sales

Net
sales

Net
sales

Net
sales

Op.
income

66.3

6.6

72.6

Op.
income

7.5

64.1

Op.
income

5.2

75.2

Op.
income

1Q-2Q
Net
sales

8.5

3Q-4Q

Op.
income

-2.2

Net
sales

-1.4

Op.
income+2.6+1.0* One of the organizations of sales channels in the Area segment was transferred to the Consumers segment from FY2024. As a result, the FY 2023 financial results
have been reclassified between the two segments.


Area




Enterprise
Net sales are forecast to rise, reflecting strong sales of IT solutions, although sales of Canon products, other are
likely to decline.
Operating income is expected to increase, reflecting a rise in gross profit due to higher sales.
FY2023

FY2024

Changes

Professional

1Q-2Q Actual

3Q-4Q Actual

1Q-2Q Actual

3Q-4Q Forecast

Net
sales

Net
sales

Net
sales

Net
sales

107.5

© Canon Marketing Japan Inc. 2024

Op.
income

9.9

112.8

Op.
income

9.8

119.6

Op.
income

10.0

116.6

Op.
income

10.5

1Q-2Q
Net
sales

+12.1

3Q-4Q

Op.
income

+0.1

Net
sales

+3.8

Op.
income+0.7

20

On the twentieth page, I will explain our forecasts for each segment.
First let us look at the Consumers segment.
From the third quarter and beyond we project increased sales and profit.
We expect sales to improve 4% to ¥75.2 billion. Operating income is projected to rise ¥1 billion year
on year to ¥8.5 billion, following growth in gross profit resulting from the sales hike.
With respect to digital interchangeable lens cameras, we recently announced that a mid-range modelof the EOS R5 Mark II would be released in August followed by a flagship model of the EOS R1 in
November. Sales of the EOS R series, including these new models, will build. Further progress
expected in the shift to mirrorless cameras will help boost RF lens sales. For these reasons, brisk
sales are projected. Sales of inkjet printers and ink cartridges will decline, reflecting a contraction of
the markets. We will focus our efforts on proposing LBPs and other high value-added products, inaddition to inkjet printers, to effectively answer the needs of customers. In doing so, we will strive tomaintain profitability. Sales of IT products are expected to rise.
Next let's look at the Enterprise segment.
From the third quarter and beyond we project increased sales and profit.
We expect net sales to improve 3% year over year to ¥116.6 billion. Operating income is projected to
grow ¥0.7 billion year on year to ¥10.5 billion, reflecting a rise in gross profit due to higher sales.
Regarding Canon product, other, we foresee a consolidation of equipment and a decline in print
volume at offices due to the reorganization of sites at large corporations. However, we will work to
improve profitability by further enhancing proposals for business process reforms to quasi-major andupper-medium-sized companies and by winning more projects for introducing systems, including
input-and-output equipment.
Sales of IT solutions are projected to grow considerably. In the same period of the previous year, we
had a large IT infrastructure project which has now ended. However, system integration projects for
manufacturers will thrive and so will imaging solutions and digital document services as part of Edge
solutions. In addition, TCS' participation in the Group last October will produce positive impacts.

Segment Forecasts
Consumers

 Area(Billions of yen)
 Net sales are expected to rise following strong sales of IT solutions.
 Operating income is expected to increase, reflecting a rise in gross profit due to higher sales.
FY2023

FY2024

ChangesEnterprise

1Q-2Q Actual

3Q-4Q Actual

1Q-2Q Actual

3Q-4Q Forecast

Net
sales

Net
sales

Net
sales

Net
sales

116.5

Op.
income

8.9

113.2

Op.
income

8.6

116.9

Op.
income

9.6

118.1

Op.
income

1Q-2Q
Net
sales

8.7

3Q-4Q

Op.
income

+0.4

Net
sales

+0.7

Op.
income+4.9+0.1* One of the organizations of sales channels in the Area segment was transferred to the Consumers segment from FY2024. As a result, the FY 2023 financial results
have been reclassified between the two segments.


Area




Professional
Net sales are expected to rise in all sub-segments, and net sales in the segment are forecast to increase.
Operating income is expected to increase, reflecting a rise in gross profit due to higher sales.
FY2023

FY2024

Changes

Professional

1Q-2Q Actual

3Q-4Q Actual

1Q-2Q Actual

3Q-4Q Forecast

Net
sales

Net
sales

Net
sales

Net
sales

22.0

© Canon Marketing Japan Inc. 2024

Op.
income

2.9

18.3

Op.
income

0.8

24.9

Op.
income

3.2

19.1

Op.
income

1Q-2Q
Net
sales

0.9

+2.9

3Q-4Q

Op.
income

+0.3

Net
sales

+0.9

Op.
income+0.2

21

We will now be moving on to the projections in the Area segment.
We project increased sales and profit from the third quarter onward.
Net sales are forecast to climb 4% year on year to ¥118.1 billion, while operating income should rise¥0.1 billion year on year to ¥8.7 billion given higher gross profit resulting from the sales growth.
Regarding Canon Products, other, we expect to boost net sales by actively pursuing proposal
activities to customers for the replacement of devices they have long used and for the solutions inaccordance with amended laws and taxation systems.
For IT solutions, we project a significant growth in net sales. This is mainly due to steady sales ofbusiness PCs owing to the end of Windows 10 support and continued solid performance at Canon
Systems and Support with the Makasete IT DX series, which provides total support for the IT
environments of SMEs, in addition to strong performance at Canon Marketing Japan with the ESET
antivirus software and HOME IT support cloud service.
Next, we will discuss the Professional segment.
From the third quarter and beyond we project increased sales and profit.
We expect net sales to improve 5% year over year to ¥19.1 billion, reflecting higher sales in eachsubsegment. Operating income is projected to increase ¥0.2 billion year on year to ¥0.9 billion,
reflecting a rise in gross profit due to increased sales.
We forecast an increase in production printing sales, in part driven by strong sales of high-speed
printer units and steady performance in the POP business.
With regard to industrial equipment, some markets are strong and others are less so. The power
semiconductor market continues to enjoy solid demand. Sales are expected to rise slightly amid brisk
sales of semiconductor-related equipment.
In healthcare business, sales are expected to climb, with the help of the effect of the integration with
Canon Medical Systems Corporation, which transferred part of its operations in the previous year, andbullish sales of projects for hospitals.

【Supplementary Material】 Outline of Main Products Sales

Please see the Supplementary Material for
FY2024 2Q on our website.
・URL
https://cweb.canon.jp/eng/ir/library/presentation.html© Canon Marketing Japan Inc. 2024

22

On the page 22, I would like to brief you on sales in monetary and unit terms for the main products
shown in the supplementary material. This is available on our website and I hope you will access it
there.
The second quarter results are as I explained in the segment information. Here I will brief you on
results for commercial printing and network cameras, which were not covered under the segment
information.
First, I will talk about Commercial Printing. Appearing in the last row of the Canon products, Other,
the change in groupwide commercial printing sales amount is listed. It is the total of production
printing sales of the Professional segment and production printing sales in other segments. In
commercial printing, sales decreased 2% year on year. Despite a hike in sales of production cut sheet
printers including the imagePRESS C265, there was no project for print management system, incontrast to the same period a year earlier.
Next, let's look at network cameras.
Amid mounting needs for security and labor savings, network cameras sales were buoyant, with aproject for cloud-based video recording service won in the Enterprise segment. These factors andothers resulted in a positive performance. In the Area segment, the VisualStage cloud-based video
recording service for small and medium enterprises and others produced strong results, whereas
there was no large infrastructure project for the public sector as there was in the same period of theprevious year.
As a consequence, network camera sales grew 1% year on year.
Then I will describe where changes have been made to previously announced figures in our 2024
forecasts.
Sales of IT products and systems were originally expected to increase 2%, but are now expected torise 7%, chiefly because of a large PC project we gained from a customer in the education area in theEnterprise segment. There are no changes to other products and services.
This concludes our briefing on the second quarter financial results for the FY2024 and the
explanation of our forecasts.
Next Mr. Osato will explain about the tender offer for our own shares.

Tender Offer for Own Shares
We resolved to acquire our own shares at the Board of Directors meeting held today.
Outline of the Purchase• Total number of shares: 22,000,000 shares(16.78% of total number of issued shares)• Total acquisition price : approximately 90 billion yen• Period of Tender Offer : From July 25, 2024 to August 22, 2024
(20 business days)• Price of the purchase : 4,091 yen per share of common stock We entered into a tender offer agreement with Canon Inc. in which Canon Inc. agreed to tender in theTender Offer 20,000,000 shares of our common stock held by Canon Inc.
 We plan to cancel, by the end of September 2024, the Tendering Shares (20,000,000 shares) out of its
own shares acquired through the Tender Offer.
© Canon Marketing Japan Inc. 2024

23

I will explain about the tender offer for our own shares we resolved at the Board of Directors meeting
held today.
We will acquire 22,000,000 of our own shares. This is equivalent to 16.78% of the total number ofissued shares.
We entered into a tender offer agreement with Canon Inc. in which Canon Inc. agreed to tender in theTender Offer 20,000,000 shares of our common stock held by Canon Inc. The Tendering Sharesacquired through the Tender Offer is planned to be cancelled by the end of September 2024.
Canon Marketing Japan has been continuously seeking ways to improve capital efficiency andenhance shareholder returns.
We have made this decision to improve the ratio of tradable shares together with capital efficiency,
including ROE and PBR, by compressing shareholders’ equity while increasing profitability, including
EPS.
Canon Marketing Japan will continue to prioritize dialogue with the capital market, and endeavor to bea more attractive company for investors to increase supportive shareholders. We would highly
appreciate your continued attention to our initiatives to further enhance the corporate value of Canon
Marketing Japan.

This concludes our briefing today.
Thank you very much.

Supplementary
Information

Capital Relationship Diagram
Canon Marketing Japan Inc.

Canon Inc.

57.76%

73,303
100%

Canon IT Solutions Inc.

90.00%

Qualysite Technologies Inc.

87.50%

Canon Software America,Inc.

49.00%

Canon IT Solutions (Thailand)
Co.,Ltd.
Baht 8.9 million

3,617
100%

100

TCS Inc.
868

100%

Canon System & Support Inc.

100%

Canon Production Printing
Systems Inc.
2,745

US$0.8 million

4,561

100%

CITS
49.00%
CITS(T) 51.00%

Canon ITS Medical Inc.

Material Automation (Thailand)
Co.,Ltd.
Baht 50million

96
100%

100%

Canon Customer Support Inc.

dcWORKS, Inc.
10

50
88.39%

Canon BizAttenda Inc.

85%

Leap, Inc.

100%

Primagest Business Service Inc.

100
100%

Canon Business Support Inc.

100%

QB5 Inc.

100%

Primagest, Inc.

99.5%

Canon Marketing Japan MIRAI Fund

10

100

10

10

100

Rate ofshareholding

As of June 30, 2024

1,000
© Canon Marketing Japan Inc. 2024

Corporate name
Capital (millions of yen)26

2Q 2024 Actual(from April 1 to June 30)

SG&A Expenses(Billions of yen)

2Q
FY20232Q
FY2024

ChangesAdvertising expenses

1.1

0.9

-0.2

Promotion expenses

0.7

0.8

+0.1

Warranty expenses

0.7

0.7

-0.1

Other direct selling
expenses

4.4

4.7

+0.3

Personnel expenses

23.3

23.3

-0.0

Office expenses

2.1

2.0

-0.1

IT expenses

2.3

2.7

+0.4

Amortization of goodwill,
etc.

0.0

0.9

+0.9

Other selling expenses

3.3

3.9

+0.6

38.0

39.9

+1.9

Total

© Canon Marketing Japan Inc. 202427

1Q-2Q 2024 Actual(from January 1 to June 30)

SG&A Expenses(Billions of yen)

1Q-2Q
FY2023

1Q-2Q
FY2024

ChangesAdvertising expenses

2.1

1.9

-0.2

Promotion expenses

1.5

1.4

-0.1

Warranty expenses

1.5

1.4

-0.1

Other direct selling
expenses

8.7

9.0

+0.3

Personnel expenses

46.0

45.6

-0.4

Office expenses

4.1

3.9

-0.1

IT expenses

4.5

5.5

+0.9

Amortization of goodwill,
etc.

0.1

1.1

+1.0

Other selling expenses

6.4

7.6

+1.2

74.9

77.4

+2.5

Total

© Canon Marketing Japan Inc. 202428

Non-operating Income and Expenses
2Q
FY20232Q
FY2024

Changes(Billions of yen)

1Q-2Q
FY2023

1Q-2Q
FY2024

ChangesInterest income

0.1

0.1

+0.0

0.2

0.2

+0.0

Dividend income

0.1

0.1

+0.0

0.1

0.2

+0.0

Insurance income

0.4

0.4

+0.0

0.5

0.4

-0.0

Foreign exchange gains

-0.0

0.1

+0.1

-

0.2

+0.2

Gain on investments inpartnership

-

0.0

+0.0

-

0.0

+0.0

0.1

0.1

+0.0

0.1

0.1

+0.0

0.7

0.9

+0.2

0.9

1.2

+0.3

0.0

0.0

+0.0

0.0

0.0

+0.0

-

0.1

+0.1

-

0.1

+0.1

Foreign exchange losses

0.0

-

-0.0

0.0

-

-0.0

Loss on investments inpartnership

-0.0

-0.0

-0.0

0.0

-

-0.0

Other, net

0.0

0.0

+0.0

0.1

0.1

+0.0

0.1

0.1

+0.0

0.1

0.2

+0.1

Other, net
Total non-operating income
Interest expense
Investment partnershipmanagement expenses

Total non-operating expenses© Canon Marketing Japan Inc. 2024

29

Extraordinary Income and Losses(Billions of yen)

2Q
FY2023Gain on sales of long-lived
assetsGain on sales of shares ofsubsidiaries and associates
Gain on sales of investments
in securities
Other, net

2Q
FY2024

1Q-2Q
FY2023

Changes

1Q-2Q
FY2024

Changes

0.0

0.0

-0.0

0.0

0.0

-0.0

-

2.9

+2.9

-

2.9

+2.9

0.1

-

-0.1

0.1

-

-0.1

-

0.0

+0.0

-

0.0

+0.0

0.1

2.9

+2.9

0.1

2.9

+2.9

Loss on sales and disposal of
long-lived assets
Loss on sales of shares ofsubsidiaries and associates

0.3

0.1

-0.3

0.4

0.1

-0.3

-

-

-

0.2

-

-0.2

Other, net

0.0

-0.0

-0.0

0.0

0.0

-0.0

0.3

0.1

-0.3

0.5

0.1

-0.4

Total extraordinary income

Total extraordinary losses© Canon Marketing Japan Inc. 2024

30

Quarterly Balance Sheets
AssetsCurrent assets
Cash and deposits
Notes accounts receivabletrade and contract assets
Inventories
Other current assets
Non-current assets
Property, plant andequipment
Intangible assets
Investment and otherassetsLiabilities
Current liabilities
Notes and accounts
payable-trade
Other current liabilities
Long-term liabilities
EquityShareholders’ equity（Treasury stock）
Total accumulated othercomprehensive income(loss)
Stock acquisition rights
Non-controlling interests
Equity ratio© Canon Marketing Japan Inc. 2024

Dec. 31
2023
557.4
418.6
89.7

Jun. 30
2024
575.8
400.2
116.8

111.6

105.5

-6.2

39.8
177.4
138.8

36.6
141.2
175.7

-3.2
-36.2
+36.9

85.0

87.3

+2.3

14.2

49.5

+35.4

Changes
+18.5
-18.5
+27.1

39.5

38.8

-0.7

121.9
110.6

128.9
115.4

+7.1
+4.8

45.6

44.8

-0.7

65.0
11.3
435.5
410.8
-2.1

70.6
13.5
446.9
421.9
-2.1

+5.5
+2.3
+11.4
+11.1
+0.0

23.9

24.2

+0.3

0.1
0.7

0.1
0.8

+0.0
+0.1

78%

77%

-1%

■ Notes accounts receivable-tradeand contract assets
68

71

105.3

FY2020(Billions of yen)

68

66

107.4

110.4

111.6

105.5

FY2021

FY2022

FY20232Q
FY202460

Notes accounts receivable-trade and contract assets
Turnover (days)■ Inventories
23

24

24

35.2

38.5

39.8

36.6

FY2021

FY2022

FY20232Q
FY2024

21

18

27.8

FY2020Inventories

31

Turnover (days)

Financial Indicator
9.2%

8.7%

8.4%

8.5%

8.6%

8.3%

6.6%

6.6%

6.5%

8.2%
6.6%
7.2%
5.7%

(Billions of yen)

5.7%

4.4%
Operating income margin

29.4

ROE

Net income attributableto owners of the parent

ROA

35.6

36.5

37.5

FY2022

FY2023

FY2024
Forecast

22.0

FY2020© Canon Marketing Japan Inc. 2024

FY202132

Financial Indicator■ Capital Investment■Cash Flow

1Q-2Q
Actual

35.9
24.9

32.1

-7.1
1Q-2Q
FY2023

4.9

4.5

9.4

FY2024 Forecast

5.9

7.9

13.9

■ Depreciation and amortization

1Q-2Q
FY2024

1Q-2Q
ActualNet cash provided by operating activities
Net cash provided by investing activities
Free cash flow

© Canon Marketing Japan Inc. 2024

Full
year

FY2023 Actual
31.8

4.2

3Q-4Q
Forecast

33

3Q-4Q
Forecast

Full
year

FY2023 Actual

4.8

4.9

9.7

FY2024 Forecast

5.0

5.2

10.2

Financial Indicator
Payout Ratio

43%

41%

33%
35%

33%

EPS:Yen

289

281

274

227

170

Dividend pershare : Yen

120

120

90
75
60

FY2020© Canon Marketing Japan Inc. 2024

FY2021

FY202234

FY2023

FY2024
Forecast

Sales Breakdown by Segment (FY2023)
4

Professional
Net sales

40.2

1Operating income

6%

3.6

(9.0%)

22%

Customers in specialized areas

Operatingmargin229.7

Operating income

17.5

52.5
8.6%

2

37%

(7.6%)

35%

SMEs nationwide
SME: Small and Medium Enterprise* Starting from FY2024, the Company transferred a part of the sales channel organization in the "Area" segment, to the “Consumer” segments.
As a result, the FY2023 financial results have been reclassified between the two segments.
* The sales shares of individual segments are calculated on their respective simple total sales.
* In addition to what is mentioned above, net sales of -19.7 billion yen and operating income of -2.4 billion yen are posted for the other segment,
which are elimination of inter-segment transactions, shared service business and corporate expenses that do not belong to any segment.
© Canon Marketing Japan Inc. 2024

Net sales

Operating income

138.9

14.1
(10.2%)Net sales 609.5
OperatingincomeArea
Net sales

Consumers

Individual customers-Production printing-Industrial equipment-Healthcare

3(Billions of yen)Enterprise
Net sales

Operating income

220.3

19.7
(8.9%)

Large, quasi-major andupper medium-sizedenterprises

35

35

Business Summary by Segment
1

2

Consumers

This segment sells imaging products, including cameras which are thebusiness Canon has been operating since its foundation, inkjet printersand other Canon products as well as non-Canon-branded products tocorporate and individual customers through retail stores andonline shops, etc.
Camera businessFor large, quasi-large and medium companies, this segment directly
provides Canon products and IT Solutions to resolve management issues
that vary depending on the industry and business type. MA HQs is incharge of large companies and GB Solutions HQs is in charge of quasilarge and medium companies. Canon IT Solutions Inc. is in charge of both.

Large
corporations

Inkjet printer businessQuasimajor anduppermediumsizedenterprises

Hobbies, photos andWorking from home

IT products business

MA HQs（Canon Marketing Japan Inc.）GB Solutions HQs（Canon Marketing Japan Inc.）

Canon IT Solutions Inc.

2003

Sumitomo Metal System Solutions Co., Ltd. is reorganized into a
subsidiary.

2007

ARGO 21 Corp. is reorganized into a subsidiary.

2008

Both Integrated into Canon IT Solutions Inc.

Strong in financial andmanufacturing sectors

High-performance PCs(used for e-sports, etc.)© Canon Marketing Japan Inc. 2024

Enterprise

36
Data Center Business36

36

Business Summary by Segment
3

4

Area

Harnessing diverse channels consisting of indirect sales by business
partners and system partners, and direct sales by Canon System andSupport Inc , this segment offers Canon products and IT solutions to
SMEs all over Japan.
Business
partners
Systempartners

SMEs

Professional

This segment offers solutions to customers in the specialized areas
like Production printing, Industrial equipment and Healthcare.
Industrial equipment
Related to
semiconductor
manufacturing

Business Partners HQs

Not related to
semiconductors（Canon Marketing Japan Inc.）

Production printing
Production printer

ProStream

MJP20JXR

Color IJ Printer

Monochrome
IJ PrinterSoftware services

Canon System and Support Inc.

1980

Copier Sales Co., Inc. is established.

2000

The company name is changed to Canon System and Support Inc.
The company becomes a wholly owned subsidiary of Canon Marketing
Japan Inc., former name of which was Canon Sales Co., Inc.

2002

Build relationships with customers
through the direct sales channels© Canon Marketing Japan Inc. 2024

Concentrate mainly on the introduction,
operations and maintenanceof IT infrastructure

Plasmaashing equipment

Cluster sputter
deposition
equipment

X-ray
analyzer

Workflowsolutions

Connect
Works Manager

POP system

Drawings
management
systemHealthcare
Industrial
3D printer* We import industrial equipment from abroad andsell localized equipment in the Japanese market.
We are also in charge of installation andmaintenance support.

Medicalimaging service

Electronic
health records

37

37

37

Enterprise and Area Segments
Both Enterprise and Area segments are providing Canon products and IT Solutions, but their customers are different.
Canon products
business

2

Edge solutions

Provision of sector/business-specific services
・Imaging solutions
・Digital document services
・Mathematical / Demand Forecasting・Low-code development

Quasi-major
and uppermedium-sizedenterprises

Area

3

HOME / IT maintenanceand operation services
Full support IT service for business
innovation

SMEs

Stable profit fromconsumables andmaintenance services© Canon Marketing Japan Inc. 2024

5

4

Security ITO・BPO

Contribution of the service business model to value creation

Promote DX business through co-creation
1 with customers

EnterpriseLarge
corporations

IT Solutions business38

38

Mission-critical Total Solution System for Manufacturing Industry
Issue

Logistic issues in 2024
Reduction of food waste

Provide SCM/ERP total solution
utilizing mathematical technologies

Production Scheduler
Demand forecasts / supply and demandplanning

Customers
 Ajinomoto Co., Inc.

Supply Chain Planning ALBION Co., Ltd
Total solution for
Total
mission-criticalsystemsolutiy

Management of
production, sales and cost

 ELECOM CO.,LTD.
 Sapporo Holdings Limited

Warehouse management Maruha Nichiro Corporation
 Mitsubishi Chemical Corporation

Accounting / fixed assets / HR & Payroll /Group business management※ We propose the most suitable solution for
individual customer from the total solutions.

For details© Canon Marketing Japan Inc. 2024

https://www.canon-its.co.jp/solution/erp/
https://www.canon-its.co.jp/solution/scm/

3939

Full Support for Business Innovation
Issue

Shortage of IT professionals© Canon Marketing Japan Inc. 2024

Total support for selection, introduction,
operation, maintenance and education of IT solutions

40

40

Outsiders' Assessments and Inclusion in Indices
ESG Indexes
Selected as a constituentof the FTSE4Good Index

Selected as a constituent of
the MSCI Japan ESG SelectLeaders Index

Selected as a constituentof the FTSE Blossom
Japan Index

Selected as a constituent of
the S&P/JPX Carbon
Efficient Index

Human Capital
Selected as a constituent of
the FTSE Blossom Japan
Sector Relative Index

Awarded Gold Class in the
Sustaina ESG Awards 2023

Eruboshi certification(two stars)

KENKO Investment for
Health Stock Selection

Ministry of Health, Labourand Welfare

Ministry of Economy, Trade andIndustry and Tokyo Stock Exchange

Platinum Kurumin
certification

Earning 4.5-star rating in
the 7th Nikkei Smart WorkManagement Survey

Ministry of Health, Labourand Welfare

Selected as a constituentof the Morningstar Japan
Equity Gender Diversity
Tilt Index(GE Group 3)

Selected as a constituentof the Sompo
Sustainability Index

Selected as an excellent
company in the Gomez ESG
Site Ranking

Selected as a constituent of
JPX Nikkei Index 400(*) THE INCLUSION OF Canon Marketing Japan Inc. IN ANY MSCI INDEX, AND THE USE OF MSCI LOGOS, TRADEMARKS, SERVICE MARKS OR INDEX NAMES HEREIN, DO NOT CONSTITUTE A SPONSORSHIP,
ENDORSEMENT OR PROMOTION OF Canon Marketing Japan Inc. BY MSCI OR ANY OF ITS AFFILIATES.
THE MSCI INDEXES ARE THE EXCLUSIVE PROPERTY OF MSCI. MSCI AND THE MSCI INDEX NAMES AND LOGOS ARE TRADEMARKS OR SERVICE MARKS OF MSCI OR ITS AFFILIATES.

© Canon Marketing Japan Inc. 2024

41

Awarded an excellent
company prize and a prize of
excellent in the IFSJ
Innovation Award with the DX
Test™ series