January 30, 2017

Summary Report of Consolidated Financial Results
for the fiscal year ended December 31, 2016

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

Canon Marketing Japan Inc.
Tokyo Stock Exchange, First Section
8060
http://cweb.canon.jp/eng/ir
Masahiro Sakata, President
Shiro Hamada, Director, Vice President
Tel. +81-3-6719-9071
Dividend payable date (as planned):
March 30, 2017
U.S. Accounting Standards Applied: No
1.Consolidated business results for the year ended December 31, 2016 (From January 1, 2016 to December 31, 2016)(1) Consolidated Results of Operations(Amounts less than one million yen are truncated)(Percentage represents increases or decreases from the previous year)
Profit attributable
Operating income
Ordinary income
to owners of parent

Net salesYear ended
December 31, 2016
December 31, 2015
[Note] Comprehensive Income:Millions of yen%

Millions of yen%

Millions of yen%

629,313(2.6)

27,676

3.9

28,717

2.4

Millions of yen

18,16115.9%

646,002(2.0)

26,647

6.2

28,040

5.6

15,670(2.2)

Year ended December 31, 2016 : 9,332 million yen [(39.9)%]
Year ended December 31, 2015 : 15,537 million yen [(7.5)%]
Basic earnings
per share

Diluted net income
per share

Yen

Year ended

Rate of returnon equity

Yen

Operating income tonet sales ratio

Ordinary income tototal assets ratio%%%

December 31, 2016

140.06

-

6.5

5.8

4.4

December 31, 2015

120.84

-

5.7

5.8

4.1

[Note] Investment profit (loss) on equity method: Year ended December 31, 2016 : -Year ended December 31, 2015 : -(2) Consolidated Financial Position(Amounts less than one million yen are truncated)
Total assets

Net assets

Millions of yen

Millions of yen

Year ended December 31, 2016
Year ended December 31, 2015
[Reference] Shareholders' equity:

Equity ratio

Net asset per share%Yen

497,727

280,91956.4

2,162.96

486,502277,43856.9

2,136.22

Year ended December 31, 2016 : 280,472 million yen
Year ended December 31, 2015 : 277,008 million yen(3) Cash FlowsNet cash provided byoperating activities(Amounts less than one million yen are truncated)
Net cash provided by
Cash and cash equivalents
financing activitiesat end of period

Net cash provided byinvesting activities

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Year ended December 31, 2016

33,306(19,460)(6,086)107,285

Year ended December 31, 2015

29,730(44,536)(6,224)

99,573

2.Dividends
Dividend per shareFirst
quarter-end

Secondquarter
-end

Third
quarter-end

Year-end

AnnualTotaldividends(annual)Ratio of
Payout ratio dividends to(Consolidated)
net assets(Consolidated)

Yen

YenYenYenYen

Yen%%

Year ended December 31, 2015

-20.00-25.00

45.00

5,835

37.2

2.1

Year ended December 31, 2016

-

20.00

-

30.00

50.00

6,483

35.7

2.3

Year ending December 31, 2017
(forecast)----

3.Consolidated financial forecast for the fiscal year ending December 31, 2017

32.7

(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

Net sales

Full year

50.00

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

Yen

645,000

2.528,800

4.1

29,6003.1

19,8009.0

152.69-1-* Others(1) Material changes in subsidiaries during this period(Changes in scope of consolidations resulting from change is subsidiaries) :None(2) Changes in accounting policies and accounting estimates, retrospective restatement( i ) Changes in accounting policies based on revisions of accounting standard:Yes( ii ) Changes in accounting policies other than ( i ) :None( iii ) Changes in accounting estimates :None( iv ) Retrospective restatement :None(3) 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 December 31, 2016 :

151,079,972

As of December 31, 2015 :

151,079,972( ii ) Number of treasury stock at the end of fiscal year
As of December 31, 2016 :21,409,021

As of December 31, 2015 :

21,407,663( iii ) Average number of shares
As of December 31, 2016 :

129,671,693

As of December 31, 2015 :

129,673,421-2-(Reference) Summary of Non-Consolidated Financial Results
1.Non-Consolidated business results for the year ended December 31, 2016 (From January 1, 2016 to December 31, 2016)(1) Non-Consolidated Results of Operations(Amounts less than one million yen are truncated)(Percentage represents increases or decreases from the previous year)
Net salesYear ended

Operating income

Ordinary income

Net income

Millions of yen%

Millions of yen%

Millions of yen%

December 31, 2016

479,457(3.3)

16,183

1.9

20,375

1.4

13,593

14.7

December 31, 2015

495,699(2.5)

15,876(2.0)

20,096

2.1

11,8491.7

Net income
per share
Year ended

Millions of yen%

Diluted net income
per share
Yen

Yen

December 31, 2016

104.83-December 31, 2015

91.38-(2) Non-Consolidated Financial Position(Amounts less than one million yen are truncated)Year ended December 31, 2016
Year ended December 31, 2015
[Reference] Shareholders' equity:

Total assets

Net assets

Millions of yen

Millions of yen

Equity ratio

Net asset per share%Yen

484,283

272,41756.3

2,100.83

476,136

264,98055.7

2,043.47

Year ended December 31, 2016 : 272,417 / Year ended December 31, 2015 : 264,980

Disclaimer :Earnings projections are based on information available at the time these materials wereannounced, and the Company cannot guarantee that they will be realized. Also, actual results may
differ from the estimated figures given due to various factors.

-3-

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

As of December 31, 2016

AssetsCurrent assets
Cash and deposits

36,77376,785

Notes and accounts receivable-trade125,906

124,475

Securities

62,80030,500

Merchandise and finished goods

28,32728,270791

834Work in process
Raw materials and supplies

887

875

Deferred tax assets

5,280

4,214

Short-term loans receivable

80,05490,044

Other

6,922

6,263

Allowance for doubtful accounts

(201)

(121)

347,542

362,141

46,92647,425

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

175

147

4,357

3,963

Rental assets, net

11,511

10,574Land

35,93934,364Tools, furniture and fixtures, net

Leased assets, net
Total property, plant and equipment

400

226

99,31096,701Intangible assets
Goodwill

820

Software

8,268

6,443

Leased assets

7653

Right of using facilities

317

317

Other

15

4

9,499

6,819

7,789

7,422

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

1010

Deferred tax assets

14,76817,668

Guarantee deposits

5,274

4,824

Other

2,605

2,483

Allowance for doubtful accounts

(298)

(344)

Total investments and other assets

30,15032,064

138,959

135,585

486,502497,727

Total non-current assets
Total assets-4-Consolidated Balance Sheets(Amounts less than one million yen are truncated)
As of December 31, 2015

As of December 31, 2016

Liabilities
Current liabilities
Notes and accounts payable-trade

101,834

102,662

Lease obligations

222

175

Accrued expenses

22,11818,968

Income taxes payable

6,201

4,689

Accrued consumption taxes

5,131

4,296

Provision for bonuses

3,506

3,473

Provision for directors' bonuses

130

128

Provision for product warranties

529

461

Provision for loss on order received

423

Other

19,99922,086

Total current liabilities

159,678

156,966

Lease obligations

321206

Deferred tax liabilities

581

422

Deferred tax liabilities for land revaluation

26

6

Accrued long service rewards for employees

943

961

Net defined benefit liability

42,82253,568

Other

4,689

4,675

Non-current liabilities

Total non-current liabilities
Total liabilities

49,38559,841

209,064

216,808

73,30373,303

Net assets
Shareholders' equity
Capital stock
Capital surplus

82,82082,820Retained earnings

151,036

163,363

Treasure stocks(31,911)(31,914)

Total shareholders' equity

275,247

287,571

2,775

2,328

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges0(14)Foreign currency translation adjustment

224

147

Remeasurements of defined benefit plans(1,240)(9,560)Total accumulated other comprehensive income

1,760(7,099)Non-controlling interests
Total net assets
Total liabilities and net assets-5-430446

277,438

280,919486,502497,727

Consolidated Statements of Income(Amounts less than one million yen are truncated)
FY2015(from January 1, 2015
to December 31, 2015)

FY2016(from January 1, 2016
to December 31, 2016)

Net sales

646,002629,313

Cost of sales

412,897

403,306

Gross profit

233,104

226,007

Selling, general and administrative expenses

206,457

198,331

Operating income

26,647

27,676

Interest income

288

220

Dividend income

118

132

Insurance income

598

609

Other

763

443

1,770

1,405

Interest expenses

2615

Foreign exchange losses

123

78

Other

226

270

Non-operating income

Total non-operating income
Non-operating expenses

Total non-operating expenses

376

363

28,04028,717

Gain on sales of non-current assets348

774

Gain on sales of investment securities

82661

Gain on sales of shares of subsidiaries and associates

56

Insurance income on disaster

34

Other
Total extraordinary income

3836559

1,473

Ordinary income
Extraordinary income-Extraordinary losses
368

985

Impairment loss

2131

Loss on disaster

1427

Special extra retirement payments

524

5Group reorganization expenses
Other

102

Loss on sales and retirement of non-current assets

-89

137

1,102

1,287

Profit before income taxes

27,49728,903

Income taxes-current

10,301

8,789

Income taxes-deferred

1,468

1,918

Total income taxes

11,76910,707

Profit15,72818,19557

33

15,67018,161

Total extraordinary losses

Profit attributable to non-controlling interests
Profit attributable to owners of parent-6-Consolidated Statements of Comprehensive Income(Amounts less than one million yen are truncated)
FY2015(from January 1, 2015
to December 31, 2015)
ProfitFY2016(from January 1, 2016
to December 31, 2016)

15,72818,195

1,071

(447)

0(15)

(20)

(80)

(1,242)(8,319)(190)(8,862)

15,537

9,332

15,451

9,302

85

30

Other comprehensive incomeValuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests-7-

Consolidated Statements of Shareholders' EquityI.

FY2015 (from January 1, 2015 to December 31, 2015)

Capitalstock
Balance at beginning of current period(Amounts less than one million yen are truncated)
Shareholders' equity
Total
Retained
Treasure
shareholders'earnings
stocksequityCapitalsurplus73,30382,819143,864

73,30382,819141,201

Cumulative effects of changes in accounting policies
Restated balance(31,905)

268,082(31,905)

265,419(2,662)(2,662)

Changes of items during period
Dividends of surplus

42,824(5,835)

Profit attributable to owners of parent(5,835)

15,670Purchase of treasury stock

15,670(7)

Disposal of treasury stock

00(7)
0

Sales of shares of consolidated subsidiaries－

Profit attributable to non-controlling interests－

Dividends paid to non-controlling interests－

Net changes of items other than shareholders' equity－

Total changes of items during period
Balance at end of current period

－

0

9,834

(6)

9,828

73,30382,820151,036(31,911)275,247

Accumulated other comprehensive income
Valuationdifference on
available-forsale
securities
Balance at beginning of current period

Total
Foreign
Remeasurements accumulated
currencyof definedothertranslation
benefit plans comprehensive
adjustment
incomeDeferred
gains orlosses onhedges

Noncontrollinginterests1,704-

272

1

1,978

291

270,352

1,704-

272

1

1,978

291

267,690

Cumulative effects of changes in accounting policies
Restated balance

Total netassets(2,662)

Changes of items during period
Dividends of surplus－(5,835)

Profit attributable to owners of parent－

15,670Purchase of treasury stock－(7)

Disposal of treasury stock－

0

Sales of shares of consolidated subsidiaries

－

63

63

Profit attributable to non-controlling interests

－

57

57

－

(10)

(10)

(218)

27(190)(1,242)

(218)

138

9,748

(1,240)1,760

430277,438

Dividends paid to non-controlling interests
1,0700(47)(1,242)

Total changes of items during period

1,0700(47)Balance at end of current period

2,7750224

Net changes of items other than shareholders' equity-8-Consolidated Statements of Shareholders' Equity
II.

FY2016 (from January 1, 2016 to December 31, 2016)

Capitalstock
Balance at beginning of current period(Amounts less than one million yen are truncated)
Shareholders' equity
Total
RetainedTreasureshareholders'earnings
stocksequityCapitalsurplus73,30382,820151,036(31,911)

275,247

73,30382,820151,036(31,911)275,247

Cumulative effects of changes in accounting policies
Restated balance-

Changes of items during period
Dividends of surplus

42,824(5,835)

Profit attributable to owners of parent(5,835)

18,161

Purchase of treasury stock

18,161(2)(2)

Disposal of treasury stock－

Sales of shares of consolidated subsidiaries－

Profit attributable to non-controlling interests－

Dividends paid to non-controlling interests－

Net changes of items other than shareholders' equity－

Total changes of items during period
Balance at end of current period－－

12,326(2)

12,32473,30382,820163,363(31,914)287,571

Accumulated other comprehensive income
Valuationdifference on
available-forsale
securities
Balance at beginning of current period

2,775

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustment
0224

Total
Remeasurements
accumulatedof definedotherbenefit
comprehensive
plansincome(1,240)430－

Cumulative effects of changes in accounting policies
Restated balance

1,760

Noncontrollinginterests

2,775

0224

(1,240)1,760

Total netassets

277,438－430

277,438

Changes of items during period
Dividends of surplus－(5,835)

Profit attributable to owners of parent－

18,161

Purchase of treasury stock－(2)

Disposal of treasury stock－－

Sales of shares of consolidated subsidiaries－－

Profit attributable to non-controlling interests

－

33

33

Dividends paid to minority shareholders

－

(10)

(10)

(446)

(15)

(77)

(8,319)(8,859)(7)(8,866)

Total changes of items during period

Net changes of items other than shareholders' equity

(446)

(15)

(77)(8,319)(8,859)16

3,481

Balance at end of current period

2,328

(14)

147

(9,560)(7,099)446

280,919-9-Consolidated Statements of Cash Flows(Amounts less than one million yen are truncated)
FY2015(from January 1, 2015
to December 31, 2015)

FY2016(from January 1, 2016
to December 31, 2016)

Cash flows from operating activities
Profit before income taxes

27,49728,903

Depreciation

15,524

14,870

2131

242

799

Impairment loss
Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts

29(34)

Increase (decrease) in net defined benefit liability(917)(1,271)

Interest and dividend income

(407)

(352)

Interest expenses

26

15

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

(25)

78

Loss (gain) on sales of investment securities

(70)

(661)

Decrease (increase) in notes and accounts receivable-trade

2,599

1,248

Decrease (increase) in inventories(2,161)

87496

843

Increase (decrease) in notes and accounts payable-trade
Other, net(2,971)(716)

Subtotal

39,86543,939Interest and dividends income received

406

366

Interest expenses paid

(26)

(17)

Income taxes paid

(10,514)(10,982)

Net cash provided by (used in) operating activities

29,73033,306(12,384)(10,990)

Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets

801

2,307

(3,002)(1,441)

Purchase of investment securities

(131)

(454)

Proceeds from sales of investment securities

168

796

Proceeds from sales of shares of subsidiaries and associates

125-(29,999)(9,990)Net decrease (increase) in short-term loans receivable
Other, net
Net cash provided by (used in) investing activities

(112)

311

(44,536)(19,460)

(375)

(239)

(7)

(2)

(5,832)(5,833)

(10)

(10)

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

0-(6,224)(6,086)(2)(47)

Net increase (decrease) in cash and cash equivalents(21,033)

7,712

Cash and cash equivalents at beginning of period

120,607

99,573

Cash and cash equivalents at end of period

99,573

107,285- 10 -Consolidated Segment Information
I. FY2015 (from January 1, 2015 to December 31, 2015)
Information on net sales and income (loss) by reportable segment.

(Amounts less than one million yen are truncated)

BusinessSolutions

ITSolutions

Imaging
SystemSales - external customers

326,870

112,621

178,701

Sales - intersegment

42,82428,579326,870

141,200

178,701

8,991

4,135

13,841(742)

421

26,647140,51065,30474,981

19,212

9,394

309,403

2,151

1,996

527

169

Industrial /Medical

Other

Total

Adjustment Consolidated

Net sales

Total
Operating income (loss)
Assets27,153-656-

27,153656

646,002-

28,579(28,579)

674,582(28,579)
177,098

646,002
646,002
26,647
486,502

Other
Depreciation

10,679-Amortization of goodwill
Increase in Property, plantand equipment andIntangible assets

10,621

97-

2,398

1,080

145

-

445

7

15,524-

15,524

242

-

242

14,553-

14,553[Note] "Other" includes businesses, such as shared service businesses, which are not included in other reportable segments.
II. FY2016 (from January 1, 2016 to December 31, 2016)
Information on net sales and income (loss) by reportable segment.
Business
Solutions(Amounts less than one million yen are truncated)

IT
Solutions

Imaging
System

114,179

159,206

Industrial /Medical

Other

Total

Adjustment Consolidated

Net sales
Sales - external customers

330,334-

Sales - intersegment
Total

330,334

Operating income
Assets

26,66325,568-25-

25,56825

629,313-

26,663(26,663)

655,976(26,663)

140,842

159,206

11,362

4,854

10,887122449

27,676

141,484

66,92571,021

17,4339,194

306,059

2,145

1,561

452

120

191,667

629,313629,31327,676
497,727

OtherDepreciation

10,589-Amortization of goodwill
Increase in Property, plantand equipment andIntangible assets

8,156

254
4,258

529

14,870-14,870

544

-

799

-

799

224

-

13,169-13,169[Note] "Other" includes businesses, such as shared service businesses, which are not included in other reportable segments.

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