Canon Inc. (7751)’s earnings this year will probably be 27 percent lower than previously estimated after last month’s earthquake and tsunami in Japan damaged factories and choked supply of components, Barclays Plc (BARC) said.
Net income at the world’s largest camera maker may be 233 billion yen ($2.8 billion) in 2011, Masahiro Nakanomyo, an analyst at Barclays in Tokyo, wrote in a report yesterday. Operating profit, or sales minus the cost of goods sold and administrative expenses, will probably be 400 billion yen, or 17 percent lower than estimated, according to the report.
Extensive damage at Canon’s plant in Utsunomiya, Tochigi prefecture, and difficulty in getting parts and materials will likely pressure production of cameras, lenses, copiers and chip- making equipment, according to Barclays. MF Global Holdings Inc. last week trimmed its annual profit forecast for Canon by 1.9 percent.
Production will probably return to normal from the quarter starting in July, Barclays said. The bank kept unchanged its estimate for the company’s operating profit for 2012. The camera maker’s three factories in Tochigi, Ibaraki and Miyazaki remained shut as of yesterday.
The Tokyo-based company may also book an expense for inventory disposal and valuation losses stemming from the earthquake, it said.
Canon fell 1.8 percent to 3,585 yen as of 1:50 p.m. in Tokyo trading. The stock has slid 6.4 percent since the March 11 earthquake that left more than 27,000 people dead or missing.
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