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Canon reports drop in 4Q profit, sees bleak 2009
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Canon reports drop in 4Q profit, sees bleak 2009
By JAY ALABASTER,Associated Press Writer AP - 2 hours 44 minutes ago
TOKYO - Canon Inc. said it expects profits to plunge this year, as it reported dismal quarterly and annual results Wednesday on the strong yen and lower sales of products such as copiers and printers.
The Japanese manufacturer, seen as a bellwether exporter by many investors due to its heavy reliance on foreign sales, said its net profit for the fourth quarter tumbled more than 90 percent to 11.6 billion yen ($130 million) versus 127.8 billion yen a year ago.
That helped drag down its 2008 profit 37 percent to 309.1 billion yen ($3.47 billion) from the 488.3 billion yen it made last year.
This year, Canon projects things will get even worse: a 70 percent drop in net earnings to 98 billion yen.
Canon has fallen victim to the yen's strength even in the rare cases it was able to maintain sales volume. The company said it increased the number of digital cameras it sold by 4 percent last year, but falling prices and the yen's appreciation meant digital camera revenues declined nearly 10 percent.
The company, which got nearly 80 percent of sales from abroad last year, also reported lower sales of major products including business copiers and computer printers. Quarterly revenue fell 21 percent to 994.7 billion yen.
Canon said foreign exchange movements hurt its revenue by 300 billion yen, a figure it expects to jump to over 400 billion yen this year. The weakness of the dollar, which has been hovering around 90 yen in recent months, erodes overseas income.
Canon's shares inched up 0.4 percent to 2,590 yen in trade Wednesday, in line with the 0.6 percent gain in the benchmark Nikkei 225 index. It announced its results after the market closed.
Unlike many other Japanese companies, Canon's fiscal year matches the calendar year.
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