Edgar Filing: CANON INC

Form 6-K

FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934


For the month of ….		October		…………………………………………………… ,		2012



		CANON INC.
		(Translation of registrant’s name into English)

		30-2, Shimomaruko 3-Chome, Ohta-ku, Tokyo 146-8501, Japan
		(Address of principal executive offices)

[Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.


Form 20-F		X		Form 40-F

[Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.


Yes				No		X

[If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):82-………………..

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


CANON INC.
(Registrant)


Date….	October 26, 2012	By ……/s/…… Toshihide Aoki ………
		(Signature)*


		Toshihide Aoki
		General Manager
		Consolidated Accounting Div.
		Canon Inc.

*Print the name and title of the signing officer under his signature.

The following materials are included.

1. CONSOLIDATED RESULTS FOR THE THIRD QUARTER AND THE NINE MONTHS ENDED SEPTEMBER 30, 2012

LOGO

CONSOLIDATED RESULTS FOR THE THIRD QUARTER AND

THE NINE MONTHS ENDED SEPTEMBER 30, 2012

October 25, 2012

CONSOLIDATED RESULTS FOR THE THIRD QUARTER

(Millions of yen, thousands of U.S. dollars, except per share amounts)



	Actual
	Three months ended September 30, 2012		Three months ended September 30, 2011		Change(%)		Three months ended September 30, 2012

Net sales	¥	799,949	¥	916,911	-	12.8	$	10,255,756
Operating profit		70,877		122,548	-	42.2		908,679
Income before income taxes		75,180		118,265	-	36.4		963,846
Net income attributable to Canon Inc.	¥	50,139	¥	77,864	-	35.6	$	642,808


Net income attributable to Canon Inc. stockholders per share:

- Basic	¥	43.15	¥	64.43	-	33.0	$	0.55
- Diluted		43.15		64.42	-	33.0		0.55


CONSOLIDATED RESULTS FOR THE NINE MONTHS
		(Millions of yen, thousands of U.S. dollars, except per share amounts)
		Actual								Projected
	Nine months ended September 30, 2012		Nine months ended September 30, 2011		Change(%)		Nine months ended September 30, 2012		Year ending December 31, 2012		Change(%)

Net sales	¥	2,528,394	¥	2,592,676	-	2.5	$	32,415,308	¥	3,532,000	-	0.7
Operating profit		246,152		283,461	-	13.2		3,155,795		356,000	-	5.8
Income before income taxes		253,449		281,924	-	10.1		3,249,346		364,000	-	2.8
Net income attributable to Canon Inc.	¥	163,391	¥	187,187	-	12.7	$	2,094,756	¥	234,000	-	5.9


Net income attributable to Canon Inc. stockholders per share:

- Basic	¥	138.48	¥	153.42	-	9.7	$	1.78	¥	202.99	-	0.7
- Diluted		138.47		153.41	-	9.7		1.78		-		-


	Actual
	As of September 30, 2012		As of December 31, 2011		Change(%)		As of September 30, 2012

Total assets	¥	3,728,388	¥	3,930,727	-	5.1	$	47,799,846

Canon Inc. stockholders’ equity	¥	2,427,216	¥	2,551,132	-	4.9	$	31,118,154


Notes:	1.	Canon’s consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles.
	2.	U.S. dollar amounts are translated from yen at the rate of JPY78=U.S.$1, the approximate exchange rate on the Tokyo Foreign Exchange Market as of September 28, 2012, solely for the convenience of the reader.


Canon Inc.			30-2, Shimomaruko 3-chome, Ohta-ku,
Headquarter office			Tokyo 146-8501, Japan
			Phone: +81-3-3758-2111

- 1 -

I. Operating Results and Financial Conditions

2012 Third Quarter in Review

Looking back at the global economy in the third quarter of 2012, in the United States, with little improvement in employment conditions and housing issues, the pace of economic recovery remained moderate, while in Europe lingering concerns over the financial crisis in Southern European nations continued to severely impact the real economy. In China and India, in addition to declines in export growth, investment and consumer spending also experienced a slowdown. And in Japan, domestic demand, which had been steady, started showing signs of weakening. As for the global economy overall, the slowdown was felt more intensely.

As for the markets in which Canon operates amid these conditions, while demand for office multifunction devices (MFDs) continued to grow steadily in Japan and elsewhere, demand for laser printers leveled off, primarily in Europe, owing to the economic downturn. Demand for interchangeable-lens digital cameras continued to realize robust growth in all regions while the market for compact digital cameras shrunk due to the stagnation of the global economy. Demand for inkjet printers on the whole also declined due to the effects of the economy. Within the industry and other segment, amid a growing sense of uncertainty regarding semiconductor lithography equipment, demand for flat-panel-display lithography equipment for large-size LCD panels remained sluggish.

The average values of the yen during the third quarter and first nine months of the year were ¥78.58 and ¥79.48 to the U.S. dollar, respectively, a year-on-year depreciation of approximately ¥1 and appreciation of approximately ¥1 and ¥98.48 and ¥101.83 to the euro, respectively, year-on-year appreciations of approximately ¥12 and ¥11.

Although Canon continued efforts to expand sales, mainly for competitively priced products such as interchangeable-lens digital cameras and office equipment, amid the negative impact of economic deterioration, mainly in Europe and emerging markets such as China, and the sharp appreciation of the yen, third-quarter net sales totaled ¥799.9 billion (U.S.$10,256 million), a decrease of 12.8% from the year-ago period. Net sales for the nine months ended September 30, 2012 totaled ¥2,528.4 billion (U.S.$32,415 million), a year-on-year decrease of 2.5%. Despite the positive effects of ongoing cost-cutting efforts, the gross profit ratio for the third quarter declined by 1.1 points to 48.3% from the year-ago period due to the significant impact of the strong yen and product mix. The gross profit ratio for the first nine months of the year also declined by 1.1 points to 48.2%. Owing to Group-wide efforts to thoroughly reduce spending, operating expenses for the third quarter decreased by ¥14.1 billion (U.S.$181 million) from the corresponding period of the previous year while operating expenses for the first nine months of the year decreased by ¥22.4 billion (U.S.$287 million). Consequently, third-quarter operating profit decreased by 42.2% to ¥70.9 billion (U.S.$909 million) while operating profit for the nine-month period decreased by 13.2% to ¥246.2 billion (U.S.$3,156 million). Other income (deductions) recorded a positive turnaround of ¥8.6 billion (U.S.$110 million) for the third quarter from the year-ago period, mainly reflecting an improvement in foreign currency exchange gains and losses, while income before income taxes decreased by 36.4% year on year to ¥75.2 billion (U.S.$964 million). For the nine months ended September 30,2012, other income (deductions) recorded an increase of ¥8.8 billion (U.S.$113 million) from the year-ago period, also due to foreign currency exchange gains and losses, and income before income taxes decreased by 10.1% year on year to ¥253.4 billion (U.S.$3,249 million). Net income attributable to Canon Inc. decreased by 35.6% to ¥50.1 billion (U.S.$643 million) for the third quarter and decreased by 12.7% to ¥163.4 billion (U.S.$2,095 million) for the first nine months of the year.

Basic net income attributable to Canon Inc. stockholders per share for the quarter was ¥43.15 (U.S.$0.55), a decrease of ¥21.28 (U.S.$0.27) compared with the corresponding quarter of the previous year, and ¥138.48 (U.S.$1.78) for the first nine months of 2012, a year-on-year decrease of ¥14.94 (U.S.$0.19).

- 2 -

Results by Segment

Looking at Canon’s quarterly performance by business unit, within the Office Business Unit, although sales volumes of MFDs increased in Japan thanks to strong sales of imageRUNNER ADVANCE-series office systems, sluggish sales in Europe and Asia led to a slight decrease in sales overall compared with the year-ago period, while sales of Océ VarioPrint-series black-and-white production printers, which were jointly developed by Canon and Océ based on an Océ engine, contributed to increased sales in Europe and the United States. As for laser printers, sales volumes declined in Europe, the United States and Asia from the corresponding period of the previous year due to deterioration in business sentiment. Consequently, combined with the appreciation of the yen, third-quarter sales for the segment totaled ¥409.4 billion (U.S.$5,248 million), declining 13.4% year on year. Likewise, operating profit for the quarter decreased by 39.3% to ¥41.1 billion (U.S.$528 million). Sales for the combined first nine months of the year totaled ¥1,301.3 billion (U.S.$16,683 million), decreasing 8.3% year on year, while operating profit declined by 20.1% to ¥152.3 billion (U.S.$1,953 million).

Within the Imaging System Business Unit, despite efforts to achieve sales growth with the competitively priced EOS Digital Rebel series along with the EOS 5D Mark III and EOS 60D advanced-amateur models, sales volumes of interchangeable-lens digital cameras decreased from the year-ago period due to a delayed new-product launch. As for compact digital cameras, while highly functional PowerShot-series models contributed to healthy sales, unit sales for the third quarter declined from the corresponding period of the previous year due to sluggish market demand. With regard to inkjet printers, sales volumes increased from the year-ago period thanks to healthy sales of mid-level and high-end models, mainly in Europe and the United States. Accordingly, third-quarter sales for the Imaging System Business Unit, which were also negatively affected by the strong yen, dropped 7.3% year on year to ¥322.1 billion (U.S.$4,129 million) while quarterly operating profit decreased by 30.0% to ¥52.6 billion (U.S.$674 million). Sales for the first nine months totaled ¥995.3 billion (U.S.$12,760 million), rising 6.0% year on year, while operating profit totaled ¥155.4 billion (U.S.$1,992 million), a decrease of 3.1% year on year.

Within the Industry and Others Business Unit, among semiconductor lithography equipment, while sales of i-line steppers remained at the same level as the previous year owing to demand for sensors and LED elements, sales volume overall decreased due to restrained capital expenditure for memory devices. As for flat-panel-display lithography equipment, unit sales decreased by half compared with the year-ago period due to sluggish demand for large-size LCD panels. Consequently, third-quarter sales for the segment decreased by 24.9% to ¥92.9 billion (U.S.$1,192 million), while operating profit totaled ¥5.0 billion (U.S.$65 million), dropping 44.6% year on year. Sales for the first nine months of the year totaled ¥301.1 billion (U.S.$3,860 million), a decrease of 1.9% year on year, while operating profit was ¥15.4 billion (U.S.$197 million), a decrease of 25.2%.

Cash Flow

During the first nine months of 2012, cash flow from operating activities totaled ¥265.8 billion (U.S.$3,408 million), a decrease of ¥76.8 billion (U.S.$985 million) compared with the year-ago period, mainly because cash outflow from inventories declined owing to the effects of optimized inventory levels facilitated by the recovery following the previous year’s flooding in Thailand.

Due to ongoing capital investment focused on boosting production, cash outflow from investing activities decreased ¥47.0 billion (U.S.$603 million) year on year, totaling ¥155.0 billion (U.S.$1,988 million). Accordingly, free cash flow totaled ¥110.8 billion (U.S.$1,420 million), a decrease of ¥29.8 billion (U.S.$382 million) from the previous year.

Cash outflow from financing activities recorded an outlay of ¥313.1 billion (U.S.$4,014 million), an increase of ¥61.5 billion (U.S.$789 million), arising from repurchases of treasury stock. Owing to these factors, as well as the negative impact of foreign currency translation adjustments, cash and cash equivalents decreased by ¥205.6 billion (U.S.$2,636 million) year on year to ¥567.6 billion (U.S.$7,277 million).

- 3 -

Outlook

As for the outlook in the fourth quarter of 2012, the global economy is expected to realize low growth due to the sluggish economies in Europe and slowdown in emerging economies, and also faces further downward risk caused by the delay in taking action in response to the eurozone sovereign debt crisis. The Japanese and U.S. economies are expected to continue recovering modestly owing to growing domestic demand.

In the businesses in which Canon is involved, within the office equipment market, demand for MFDs is projected to grow steadily in Japan and the United States. As for laser printers, forecasts call for challenging conditions amid the negative effects of deteriorating business sentiment. Demand for interchangeable-lens digital cameras is expected to continue increasing across most regions, although prospects remain uncertain in some areas. Demand for compact digital cameras is anticipated to increase for models offering high functionality and high added value. As for inkjet printers, demand is expected to grow toward the end of the year. In the industry and others market, capital investment by memory manufacturers for semiconductor lithography equipment will likely continue to be restrained and demand for flat-panel-display lithography equipment is expected to remain sluggish for the remainder of the year.

With regard to currency exchange rates for the last quarter of 2012, on which Canon’s performance outlook is based, despite uncertain prospects for the global economy, Canon anticipates exchange rates of ¥78 to the U.S. dollar and ¥100 to the euro.

Upon taking into consideration the abovementioned foreign exchange rate assumptions and current economic forecasts, Canon projects full-year consolidated net sales of ¥3,532.0 billion (U.S.$45,282 million), a year-on-year decrease of 0.7%; operating profit of ¥356.0 billion (U.S.$4,564 million), a year-on-year decrease of 5.8%; income before income taxes of ¥364.0 billion (U.S.$4,667 million), a year-on-year decrease of 2.8%; and net income attributable to Canon Inc. of ¥234.0 billion (U.S.$3,000 million), a year-on-year decrease of 5.9%.

Consolidated Outlook


	Millions of yen
Fiscal year	Millions of yen
	Year ending December 31, 2012				Change		Year ended December 31, 2011		Change (%)
	Previous Outlook (A)		Revised Outlook (B)		(B - A)		Results (C)		(B - C) / C
Net sales	¥	3,690,000	¥	3,532,000	¥	(158,000)	¥	3,557,433		-0.7%
Operating profit		390,000		356,000		(34,000)		378,071		-5.8%
Income before income taxes		395,000		364,000		(31,000)		374,524		-2.8%
Net income attributable to Canon Inc.	¥	250,000	¥	234,000	¥	(16,000)	¥	248,630		-5.9%

This document contains forward-looking statements with respect to future results, performance and achievements that are subject to risk and uncertainties and reflect management’s views and assumptions formed by available information. All statements other than statements of historical fact are statements that could be considered forward-looking statements. When used in this document, words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “project” or “should” and similar expressions, as they relate to Canon, are intended to identify forward-looking statements. Many factors could cause the actual results, performance or achievements of Canon to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in general economic and business conditions, changes in currency exchange rates and interest rates, introduction of competing products by other companies, lack of acceptance of new products or services by Canon’s targeted customers, inability to meet efficiency and cost reduction objectives, changes in business strategy and various other factors, both referenced and not referenced in this document. A detailed description of these and other risk factors is included in Canon’s annual report on Form 20-F, which is on file with the United States Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein. Canon does not intend or assume any obligation to update these forward-looking statements.

- 4 -

CANON INC. AND SUBSIDIARIES

CONSOLIDATED

II. Financial Statements

1. CONSOLIDATED BALANCE SHEETS


	Millions of yen									Thousands of U.S. dollars
	As of September 30, 2012			As of December 31, 2011			Change			As of September 30, 2012
ASSETS
Current assets:
Cash and cash equivalents	¥	567,610		¥	773,227		¥	(205,617	)	$	7,277,051
Short-term investments		48,339			125,517			(77,178	)		619,731
Trade receivables, net		459,025			533,208			(74,183	)		5,884,936
Inventories		591,121			476,704			114,417			7,578,474
Prepaid expenses and other current assets		250,957			244,649			6,308			3,217,398

Total current assets		1,917,052			2,153,305			(236,253	)		24,577,590
Noncurrent receivables		18,367			16,772			1,595			235,474
Investments		53,149			51,790			1,359			681,397
Property, plant and equipment, net		1,226,589			1,190,836			35,753			15,725,500
Intangible assets, net		129,457			138,030			(8,573	)		1,659,705
Other assets		383,774			379,994			3,780			4,920,180

Total assets	¥	3,728,388		¥	3,930,727		¥	(202,339	)	$	47,799,846


LIABILITIES AND EQUITY
Current liabilities:
Short-term loans and current portion of long-term debt	¥	2,309		¥	8,343		¥	(6,034	)	$	29,603
Trade payables		346,516			380,532			(34,016	)		4,442,513
Accrued income taxes		48,550			45,900			2,650			622,436
Accrued expenses		281,918			299,422			(17,504	)		3,614,333
Other current liabilities		141,078			159,651			(18,573	)		1,808,692

Total current liabilities		820,371			893,848			(73,477	)		10,517,577
Long-term debt, excluding current installments		2,121			3,368			(1,247	)		27,192
Accrued pension and severance cost		250,335			249,604			731			3,209,423
Other noncurrent liabilities		70,455			70,240			215			903,269

Total liabilities		1,143,282			1,217,060			(73,778	)		14,657,461


Equity:
Canon Inc. stockholders’ equity:
Common stock		174,762			174,762			-			2,240,538
Additional paid-in capital		399,190			401,572			(2,382	)		5,117,821
Legal reserve		61,234			59,004			2,230			785,051
Retained earnings		3,078,233			3,059,298			18,935			39,464,526
Accumulated other comprehensive income (loss)		(474,531	)		(481,773	)		7,242			(6,083,731	)
Treasury stock, at cost		(811,672	)		(661,731	)		(149,941	)		(10,406,051	)

Total Canon Inc. stockholders’ equity		2,427,216			2,551,132			(123,916	)		31,118,154

Noncontrolling interests		157,890			162,535			(4,645	)		2,024,231



Total equity		2,585,106			2,713,667			(128,561	)		33,142,385



Total liabilities and equity	¥	3,728,388		¥	3,930,727		¥	(202,339	)	$	47,799,846



	Millions of yen									Thousands of U.S. dollars
	As of September 30, 2012			As of December 31, 2011						As of September 30, 2012
Notes:
1. Allowance for doubtful receivables	¥	11,190		¥	11,563					$	143,462
2. Accumulated depreciation		2,087,108			2,038,682						26,757,795
3. Accumulated other comprehensive income (loss):
Foreign currency translation adjustments		(373,637	)		(378,863	)					(4,790,218	)
Net unrealized gains and losses on securities		1,964			1,003						25,179
Net gains and losses on derivative instruments		659			455						8,449
Pension liability adjustments		(103,517	)		(104,368	)					(1,327,141	)

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

2. CONSOLIDATED STATEMENTS OF INCOME AND CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Consolidated statements of income


Results for the third quarter	Millions of yen								Thousands of U.S. dollars
	Three months ended September 30, 2012			Three months ended September 30, 2011			Change(%)		Three months ended September 30, 2012

Net sales	¥	799,949		¥	916,911		-	12.8	$	10,255,756
Cost of sales		413,194			464,405					5,297,359

Gross profit		386,755			452,506		-	14.5		4,958,397
Operating expenses:
Selling, general and administrative expenses		243,403			251,974					3,120,551
Research and development expenses		72,475			77,984					929,167

		315,878			329,958					4,049,718

Operating profit		70,877			122,548		-	42.2		908,679
Other income (deductions):
Interest and dividend income		1,515			2,056					19,423
Interest expense		(138	)		(155	)				(1,769	)
Other, net		2,926			(6,184	)				37,513

		4,303			(4,283	)				55,167

Income before income taxes		75,180			118,265		-	36.4		963,846

Income taxes		24,021			39,733					307,961

Consolidated net income		51,159			78,532					655,885
Less: Net income attributable to noncontrolling interests		1,020			668					13,077

Net income attributable to Canon Inc.	¥	50,139		¥	77,864		-	35.6	$	642,808


Results for the nine months	Millions of yen								Thousands of U.S. dollars
	Nine months ended September 30, 2012			Nine months ended September 30, 2011			Change(%)		Nine months ended September 30, 2012

Net sales	¥	2,528,394		¥	2,592,676		-	2.5	$	32,415,308
Cost of sales		1,310,820			1,315,434					16,805,385

Gross profit		1,217,574			1,277,242		-	4.7		15,609,923
Operating expenses:
Selling, general and administrative expenses		749,594			769,623					9,610,179
Research and development expenses		221,828			224,158					2,843,949

		971,422			993,781					12,454,128

Operating profit		246,152			283,461		-	13.2		3,155,795
Other income (deductions):
Interest and dividend income		5,089			5,816					65,244
Interest expense		(513	)		(827	)				(6,577	)
Other, net		2,721			(6,526	)				34,884

		7,297			(1,537	)				93,551

Income before income taxes		253,449			281,924		-	10.1		3,249,346

Income taxes		85,524			91,992					1,096,461

Consolidated net income		167,925			189,932					2,152,885
Less: Net income attributable to noncontrolling interests		4,534			2,745					58,129

Net income attributable to Canon Inc.	¥	163,391		¥	187,187		-	12.7	$	2,094,756

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

Consolidated statements of comprehensive income


Results for the third quarter	Millions of yen								Thousands of U.S. dollars
	Three months ended September 30, 2012			Three months ended September 30, 2011			Change(%)		Three months ended September 30, 2012
Consolidated net income	¥	51,159		¥	78,532		-	34.9	$	655,885
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments		(1,734	)		(78,847	)				(22,231	)
Net unrealized gains and losses on securities		(61	)		(2,976	)				(782	)
Net gains and losses on derivative instruments		(654	)		1,528					(8,385	)
Pension liability adjustments		361			40					4,628

		(2,088	)		(80,255	)				(26,770	)

Comprehensive income(loss)		49,071			(1,723	)		-		629,115
Less: Comprehensive income(loss) attributable to noncontrolling interests		1,241			(518	)				15,910

Comprehensive income(loss) attributable to Canon Inc.	¥	47,830		¥	(1,205	)		-	$	613,205


Results for the nine months	Millions of yen								Thousands of U.S. dollars
	Nine months ended September 30, 2012			Nine months ended September 30, 2011			Change(%)		Nine months ended September 30, 2012
Consolidated net income	¥	167,925		¥	189,932		-	11.6	$	2,152,885
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments		6,632			(58,330	)				85,026
Net unrealized gains and losses on securities		928			(4,112	)				11,897
Net gains and losses on derivative instruments		243			1,170					3,115
Pension liability adjustments		949			1,501					12,167

		8,752			(59,771	)				112,205

Comprehensive income		176,677			130,161		+	35.7		2,265,090
Less: Comprehensive income attributable to noncontrolling interests		4,777			2,687					61,244

Comprehensive income attributable to Canon Inc.	¥	171,900		¥	127,474		+	34.9	$	2,203,846

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

3. DETAILS OF SALES


Results for the third quarter	Millions of yen								Thousands of U.S. dollars
Sales by business unit	Three months ended September 30, 2012			Three months ended September 30, 2011			Change(%)		Three months ended September 30, 2012
Office	¥	409,351		¥	472,941		-	13.4	$	5,248,090
Imaging System		322,086			347,442		-	7.3		4,129,308
Industry and Others		92,942			123,784		-	24.9		1,191,564
Eliminations		(24,430	)		(27,256	)		-		(313,206	)

Total	¥	799,949		¥	916,911		-	12.8	$	10,255,756


	Millions of yen								Thousands of U.S. dollars
Sales by region	Three months ended September 30, 2012			Three months ended September 30, 2011			Change(%)		Three months ended September 30, 2012
Japan	¥	165,759		¥	169,526		-	2.2	$	2,125,115
Overseas:
Americas		219,993			240,598		-	8.6		2,820,423
Europe		221,740			273,823		-	19.0		2,842,821
Asia and Oceania		192,457			232,964		-	17.4		2,467,397

		634,190			747,385		-	15.1		8,130,641

Total	¥	799,949		¥	916,911		-	12.8	$	10,255,756


Results for the nine months	Millions of yen								Thousands of U.S. dollars
Sales by business unit	Nine months ended September 30, 2012			Nine months ended September 30, 2011			Change(%)		Nine months ended September 30, 2012
Office	¥	1,301,252		¥	1,419,602		-	8.3	$	16,682,718
Imaging System		995,296			939,279		+	6.0		12,760,205
Industry and Others		301,072			306,833		-	1.9		3,859,897
Eliminations		(69,226	)		(73,038	)		-		(887,512	)

Total	¥	2,528,394		¥	2,592,676		-	2.5	$	32,415,308


	Millions of yen								Thousands of U.S. dollars
Sales by region	Nine months ended September 30, 2012			Nine months ended September 30, 2011			Change(%)		Nine months ended September 30, 2012
Japan	¥	521,483		¥	493,130		+	5.7	$	6,685,679
Overseas:
Americas		673,521			687,651		-	2.1		8,634,885
Europe		725,129			822,417		-	11.8		9,296,526
Asia and Oceania		608,261			589,478		+	3.2		7,798,218

		2,006,911			2,099,546		-	4.4		25,729,629

Total	¥	2,528,394		¥	2,592,676		-	2.5	$	32,415,308


Notes: 1.		The primary products included in each of the segments are as follows:


				Office Business Unit :		Office multifunction devices (MFDs) / Office copying machines / Personal-use copying machines / Laser MFDs / Laser printers / Digital production printing systems / High speed continuous feed printers / Wide-format printers / Document solution


		Imaging System Business Unit *:		Interchangeable-lens digital cameras / Compact digital cameras / Digital camcorders / Digital cinema cameras / Interchangeable lenses / Inkjet printers /Large-format inkjet printers / Commercial photo printers / Image scanners / Broadcast equipment / Calculators


		Industry and Others Business Unit :		Semiconductor lithography equipment / Flat-panel-display lithography equipment / Digital radiography systems / Ophthalmic equipment / Vacuum thin-film deposition equipment / Organic LED panel manufacturing equipment / Micromotors / Computers / Handy terminals / Document scanners

* The “Consumer Business Unit” has been renamed the “Imaging System Business Unit”.

2. The principal countries and regions included in each regional category are as follows:

Americas: United States of America, Canada, Latin America

Europe: United Kingdom, Germany, France, Netherlands, European countries, Middle East and Africa

Asia and Oceania: China, Asian countries, Australia

- 8 -

CANON INC. AND SUBSIDIARIES

CONSOLIDATED

4. CONSOLIDATED STATEMENTS OF CASH FLOWS


	Millions of yen						Thousands of U.S. dollars
	Nine months ended September 30, 2012			Nine months ended September 30, 2011			Nine months ended September 30, 2012
Cash flows from operating activities:
Consolidated net income	¥	167,925		¥	189,932		$	2,152,885
Adjustments to reconcile consolidated net income to net cash provided by operating activities:
Depreciation and amortization		185,228			190,528			2,374,718
Loss on disposal of fixed assets		9,582			6,946			122,846
Deferred income taxes		(963	)		(8,017	)		(12,346	)
Decrease in trade receivables		73,160			62,847			937,949
Increase in inventories		(113,366	)		(151,547	)		(1,453,410	)
Increase (decrease) in trade payables		(29,573	)		71,560			(379,141	)
Increase (decrease) in accrued income taxes		2,649			(3,242	)		33,962
Increase (decrease) in accrued expenses		(17,590	)		17,475			(225,513	)
Increase (decrease) in accrued (prepaid) pension and severance cost		2,621			(941	)		33,603
Other, net		(13,858	)		(32,958	)		(177,668	)

Net cash provided by operating activities		265,815			342,583			3,407,885
Cash flows from investing activities:
Purchases of fixed assets		(233,415	)		(159,319	)		(2,992,500	)
Proceeds from sale of fixed assets		2,442			2,695			31,308
Purchases of available-for-sale securities		(300	)		(1,939	)		(3,846	)
Proceeds from sale and maturity of available-for-sale securities		223			1,586			2,859
(Increase) decrease in time deposits, net		79,312			(57,144	)		1,016,821
Acquisitions of subsidiaries, net of cash acquired		(704	)		17			(9,026	)
Purchases of other investments		(796	)		(147	)		(10,205	)
Other, net		(1,795	)		12,251			(23,014	)

Net cash used in investing activities		(155,033	)		(202,000	)		(1,987,603	)
Cash flows from financing activities:
Proceeds from issuance of long-term debt		389			712			4,987
Repayments of long-term debt		(3,632	)		(4,053	)		(46,564	)
Increase (decrease) in short-term loans, net		(4,547	)		7,479			(58,295	)
Dividends paid		(142,362	)		(152,784	)		(1,825,154	)
Repurchases of treasury stock, net		(149,966	)		(99,835	)		(1,922,641	)
Other, net		(12,992	)		(3,088	)		(166,564	)

Net cash used in financing activities		(313,110	)		(251,569	)		(4,014,231	)
Effect of exchange rate changes on cash and cash equivalents		(3,289	)		(17,962	)		(42,166	)

Net change in cash and cash equivalents		(205,617	)		(128,948	)		(2,636,115	)
Cash and cash equivalents at beginning of period		773,227			840,579			9,913,166

Cash and cash equivalents at end of period	¥	567,610		¥	711,631		$	7,277,051

- 9 -

CANON INC. AND SUBSIDIARIES

CONSOLIDATED

5. NOTE FOR GOING CONCERN ASSUMPTION

Not applicable.

6. SEGMENT INFORMATION

(1) SEGMENT INFORMATION BY BUSINESS UNIT


Results for the third quarter		Millions of yen								Thousands of U.S. dollars
		Three months ended September 30, 2012			Three months ended September 30, 2011			Change(%)		Three months ended September 30, 2012
Office
Net sales:
	External customers	¥	407,661		¥	471,302		-	13.5	$	5,226,423
	Intersegment		1,690			1,639		+	3.1		21,667

	Total		409,351			472,941		-	13.4		5,248,090

Operating cost and expenses			368,203			405,164		-	9.1		4,720,552

Operating profit		¥	41,148		¥	67,777		-	39.3	$	527,538


Imaging System
Net sales:
	External customers	¥	321,788		¥	347,167		-	7.3	$	4,125,487
	Intersegment		298			275		+	8.4		3,821

	Total		322,086			347,442		-	7.3		4,129,308

Operating cost and expenses			269,478			272,270		-	1.0		3,454,846

Operating profit		¥	52,608		¥	75,172		-	30.0	$	674,462


Industry and Others
Net sales:
	External customers	¥	70,500		¥	98,442		-	28.4	$	903,846
	Intersegment		22,442			25,342		-	11.4		287,718

	Total		92,942			123,784		-	24.9		1,191,564

Operating cost and expenses			87,907			114,698		-	23.4		1,127,013

Operating profit		¥	5,035		¥	9,086		-	44.6	$	64,551


Corporate and Eliminations
Net sales:
	External customers	¥	-		¥	-			-	$	-
	Intersegment		(24,430	)		(27,256	)		-		(313,206	)

	Total		(24,430	)		(27,256	)		-		(313,206	)

Operating cost and expenses			3,484			2,231			-		44,666

Operating profit		¥	(27,914	)	¥	(29,487	)		-	$	(357,872	)


Consolidated
Net sales:
	External customers	¥	799,949		¥	916,911		-	12.8	$	10,255,756
	Intersegment		-			-			-		-

	Total		799,949			916,911		-	12.8		10,255,756

Operating cost and expenses			729,072			794,363		-	8.2		9,347,077

Operating profit		¥	70,877		¥	122,548		-	42.2	$	908,679

- 10 -

CANON INC. AND SUBSIDIARIES

CONSOLIDATED


Results for the nine months		Millions of yen								Thousands of U.S. dollars
		Nine months ended September 30, 2012			Nine months ended September 30, 2011			Change(%)		Nine months ended September 30, 2012
Office
Net sales:
	External customers	¥	1,297,269		¥	1,414,654		-	8.3	$	16,631,654
	Intersegment		3,983			4,948		-	19.5		51,064

	Total		1,301,252			1,419,602		-	8.3		16,682,718

Operating cost and expenses			1,148,946			1,228,931		-	6.5		14,730,077

Operating profit		¥	152,306		¥	190,671		-	20.1	$	1,952,641


Imaging System
Net sales:
	External customers	¥	994,102		¥	938,528		+	5.9	$	12,744,898
	Intersegment		1,194			751		+	59.0		15,308

	Total		995,296			939,279		+	6.0		12,760,206

Operating cost and expenses			839,941			778,883		+	7.8		10,768,475

Operating profit		¥	155,355		¥	160,396		-	3.1	$	1,991,731


Industry and Others
Net sales:
	External customers	¥	237,023		¥	239,494		-	1.0	$	3,038,756
	Intersegment		64,049			67,339		-	4.9		821,141

	Total		301,072			306,833		-	1.9		3,859,897

Operating cost and expenses			285,712			286,310		-	0.2		3,662,974

Operating profit		¥	15,360		¥	20,523		-	25.2	$	196,923


Corporate and Eliminations
Net sales:
	External customers	¥	-		¥	-			-	$	-
	Intersegment		(69,226	)		(73,038	)		-		(887,513	)

	Total		(69,226	)		(73,038	)		-		(887,513	)

Operating cost and expenses			7,643			15,091			-		97,987

Operating profit		¥	(76,869	)	¥	(88,129	)		-	$	(985,500	)


Consolidated
Net sales:
	External customers	¥	2,528,394		¥	2,592,676		-	2.5	$	32,415,308
	Intersegment		-			-			-		-

	Total		2,528,394			2,592,676		-	2.5		32,415,308

Operating cost and expenses			2,282,242			2,309,215		-	1.2		29,259,513

Operating profit		¥	246,152		¥	283,461		-	13.2	$	3,155,795

- 11 -

CANON INC. AND SUBSIDIARIES

CONSOLIDATED

(2) SEGMENT INFORMATION BY GEOGRAPHIC AREA


Results for the third quarter		Millions of yen								Thousands of U.S. dollars
		Three months ended September 30, 2012			Three months ended September 30, 2011			Change(%)		Three months ended September 30, 2012
Japan
Net sales:
	External customers	¥	185,558		¥	213,453		-	13.1	$	2,378,949
	Intersegment		462,541			541,707		-	14.6		5,930,013

	Total		648,099			755,160		-	14.2		8,308,962

Operating cost and expenses			579,714			644,963		-	10.1		7,432,231

Operating profit		¥	68,385		¥	110,197		-	37.9	$	876,731


Americas
Net sales:
	External customers	¥	219,710		¥	237,761		-	7.6	$	2,816,795
	Intersegment		6,068			5,291		+	14.7		77,795

	Total		225,778			243,052		-	7.1		2,894,590

Operating cost and expenses			219,042			230,767		-	5.1		2,808,231

Operating profit		¥	6,736		¥	12,285		-	45.2	$	86,359


Europe
Net sales:
	External customers	¥	221,338		¥	273,314		-	19.0	$	2,837,666
	Intersegment		1,258			1,472		-	14.5		16,128

	Total		222,596			274,786		-	19.0		2,853,794

Operating cost and expenses			212,481			260,120		-	18.3		2,724,115

Operating profit		¥	10,115		¥	14,666		-	31.0	$	129,679


Asia and Oceania
Net sales:
	External customers	¥	173,343		¥	192,383		-	9.9	$	2,222,346
	Intersegment		190,111			225,350		-	15.6		2,437,321

	Total		363,454			417,733		-	13.0		4,659,667

Operating cost and expenses			351,425			398,688		-	11.9		4,505,449

Operating profit		¥	12,029		¥	19,045		-	36.8	$	154,218


Corporate and Eliminations
Net sales:
	External customers	¥	-		¥	-			-	$	-
	Intersegment		(659,978	)		(773,820	)		-		(8,461,257	)

	Total		(659,978	)		(773,820	)		-		(8,461,257	)

Operating cost and expenses			(633,590	)		(740,175	)		-		(8,122,949	)

Operating profit		¥	(26,388	)	¥	(33,645	)		-	$	(338,308	)


Consolidated
Net sales:
	External customers	¥	799,949		¥	916,911		-	12.8	$	10,255,756
	Intersegment		-			-			-		-

	Total		799,949			916,911		-	12.8		10,255,756

Operating cost and expenses			729,072			794,363		-	8.2		9,347,077

Operating profit		¥	70,877		¥	122,548		-	42.2	$	908,679

- 12 -

CANON INC. AND SUBSIDIARIES

CONSOLIDATED


Results for the nine months		Millions of yen								Thousands of U.S. dollars
		Nine months ended September 30, 2012			Nine months ended September 30, 2011			Change(%)		Nine months ended September 30, 2012
Japan
Net sales:
	External customers	¥	599,352		¥	572,347		+	4.7	$	7,684,000
	Intersegment		1,397,550			1,419,806		-	1.6		17,917,308

	Total		1,996,902			1,992,153		+	0.2		25,601,308

Operating cost and expenses			1,755,339			1,699,616		+	3.3		22,504,346

Operating profit		¥	241,563		¥	292,537		-	17.4	$	3,096,962


Americas
Net sales:
	External customers	¥	667,809		¥	682,176		-	2.1	$	8,561,654
	Intersegment		18,157			12,352		+	47.0		232,782

	Total		685,966			694,528		-	1.2		8,794,436

Operating cost and expenses			670,672			677,833		-	1.1		8,598,359

Operating profit		¥	15,294		¥	16,695		-	8.4	$	196,077


Europe
Net sales:
	External customers	¥	723,819		¥	818,803		-	11.6	$	9,279,731
	Intersegment		4,311			3,483		+	23.8		55,269

	Total		728,130			822,286		-	11.5		9,335,000

Operating cost and expenses			701,332			788,977		-	11.1		8,991,436

Operating profit		¥	26,798		¥	33,309		-	19.5	$	343,564


Asia and Oceania
Net sales:
	External customers	¥	537,414		¥	519,350		+	3.5	$	6,889,923
	Intersegment		596,338			560,780		+	6.3		7,645,359

	Total		1,133,752			1,080,130		+	5.0		14,535,282

Operating cost and expenses			1,089,659			1,036,900		+	5.1		13,969,987

Operating profit		¥	44,093		¥	43,230		+	2.0	$	565,295


Corporate and Eliminations
Net sales:
	External customers	¥	-		¥	-			-	$	-
	Intersegment		(2,016,356	)		(1,996,421	)		-		(25,850,718	)

	Total		(2,016,356	)		(1,996,421	)		-		(25,850,718	)

Operating cost and expenses			(1,934,760	)		(1,894,111	)		-		(24,804,615	)

Operating profit		¥	(81,596	)	¥	(102,310	)		-	$	(1,046,103	)


Consolidated
Net sales:
	External customers	¥	2,528,394		¥	2,592,676		-	2.5	$	32,415,308
	Intersegment		-			-			-		-

	Total		2,528,394			2,592,676		-	2.5		32,415,308

Operating cost and expenses			2,282,242			2,309,215		-	1.2		29,259,513

Operating profit		¥	246,152		¥	283,461		-	13.2	$	3,155,795

- 13 -

CANON INC. AND SUBSIDIARIES

CONSOLIDATED

7. SIGNIFICANT CHANGES IN CANON INC. STOCKHOLDERS’ EQUITY

None.

8. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

(1) GROUP POSITION

Number of Group Companies


	September 30, 2012		December 31, 2011		Change
Subsidiaries		277		277		-
Affiliates		9		11		(2	)
Total		286		288		(2	)

Change in Group Entities


Subsidiaries
Addition:		17 companies
Removal:		17 companies

Affiliates(Carried at Equity Basis)
Removal:		2 companies

Subsidiaries Listed on Domestic Stock Exchange

Tokyo Stock Exchange (1st section): Canon Marketing Japan Inc., Canon Electronics Inc.

(2) SIGNIFICANT ACCOUNTING POLICIES

Canon’s consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles.

- 14 -

Canon Inc.

Oct. 25, 2012

CONSOLIDATED FINANCIAL RESULTS FOR

THE THIRD QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2012

SUPPLEMENTARY REPORT

TABLE OF CONTENTS


		PAGE
1.	SALES BY GEOGRAPHIC AREA AND BUSINESS UNIT		S 1

2.	SEGMENT INFORMATION BY BUSINESS UNIT		S 2

3.	OTHER INCOME / DEDUCTIONS		S 2

4.	BREAKDOWN OF PRODUCT SALES WITHIN BUSINESS UNIT		S 3

5.	SALES GROWTH IN LOCAL CURRENCY (Year over year)		S 3

6.	PROFITABILITY		S 4

7.	IMPACT OF FOREIGN EXCHANGE RATES		S 4

8.	STATEMENTS OF CASH FLOWS		S 4

9.	R&D EXPENDITURE		S 5

10.	INCREASE IN PP&E & DEPRECIATION AND AMORTIZATION		S 5

11.	INVENTORIES		S 5

12.	DEBT RATIO		S 5

13.	OVERSEAS PRODUCTION RATIO		S 5

14.	NUMBER OF EMPLOYEES		S 5

Canon Inc.

1. SALES BY GEOGRAPHIC AREA AND BUSINESS UNIT

(Millions of yen

)


		2012									2011									Change year over year
		3rd quarter			YTD			Year (P)			3rd quarter			YTD			Year			3rd quarter			YTD			Year
Japan
	Office		87,294			274,887			-			85,879			265,336			362,528			+1.6	%		+3.6	%		-
	Imaging System		46,678			139,062			-			46,033			125,807			187,397			+1.4	%		+10.5	%		-
	Industry and Others		31,787			107,534			-			37,614			101,987			144,525			-15.5	%		+5.4	%		-
	Total		165,759			521,483			734,500			169,526			493,130			694,450			-2.2	%		+5.7	%		+5.8%
Overseas
	Office		320,367			1,022,382			-			385,423			1,149,318			1,549,584			-16.9	%		-11.0	%		-
	Imaging System		275,110			855,040			-			301,134			812,721			1,123,626			-8.6	%		+5.2	%		-
	Industry and Others		38,713			129,489			-			60,828			137,507			189,773			-36.4	%		-5.8	%		-
	Total		634,190			2,006,911			2,797,500			747,385			2,099,546			2,862,983			-15.1	%		-4.4	%		-2.3%
Americas
	Office		130,849			395,562			-			148,509			434,253			588,190			-11.9	%		-8.9	%		-
	Imaging System		79,239			246,505			-			82,218			225,396			335,158			-3.6	%		+9.4	%		-
	Industry and Others		9,905			31,454			-			9,871			28,002			38,607			+0.3	%		+12.3	%		-
	Total		219,993			673,521			944,100			240,598			687,651			961,955			-8.6	%		-2.1	%		-1.9%
Europe
	Office		130,720			431,790			-			165,340			516,538			696,239			-20.9	%		-16.4	%		-
	Imaging System		86,489			278,090			-			103,556			286,735			391,747			-16.5	%		-3.0	%		-
	Industry and Others		4,531			15,249			-			4,927			19,144			25,079			-8.0	%		-20.3	%		-
	Total		221,740			725,129			1,025,900			273,823			822,417			1,113,065			-19.0	%		-11.8	%		-7.8%
Asia and Oceania
	Office		58,798			195,030			-			71,574			198,527			265,155			-17.9	%		-1.8	%		-
	Imaging System		109,382			330,445			-			115,360			300,590			396,721			-5.2	%		+9.9	%		-
	Industry and Others		24,277			82,786			-			46,030			90,361			126,087			-47.3	%		-8.4	%		-
	Total		192,457			608,261			827,500			232,964			589,478			787,963			-17.4	%		+3.2	%		+5.0%
Intersegment
	Office		1,690			3,983			-			1,639			4,948			5,831			+3.1	%		-19.5	%		-
	Imaging System		298			1,194			-			275			751			1,021			+8.4	%		+59.0	%		-
	Industry and Others		22,442			64,049			-			25,342			67,339			86,565			-11.4	%		-4.9	%		-
	Eliminations		(24,430	)		(69,226	)		-			(27,256	)		(73,038	)		(93,417	)		-			-			-
	Total		0			0			0			0			0			0			-			-			-
Total
	Office		409,351			1,301,252			1,762,700			472,941			1,419,602			1,917,943			-13.4	%		-8.3	%		-8.1%
	Imaging System		322,086			995,296			1,444,700			347,442			939,279			1,312,044			-7.3	%		+6.0	%		+10.1%
	Industry and Others		92,942			301,072			416,200			123,784			306,833			420,863			-24.9	%		-1.9	%		-1.1%
	Eliminations		(24,430	)		(69,226	)		(91,600	)		(27,256	)		(73,038	)		(93,417	)		-			-			-
	Total		799,949			2,528,394			3,532,000			916,911			2,592,676			3,557,433			-12.8	%		-2.5	%		-0.7%

(P)=Projection

- S1 -

Canon Inc.

2. SEGMENT INFORMATION BY BUSINESS UNIT

(Millions of yen

)


		2012									2011									Change year over year
		3rd quarter			YTD			Year (P)			3rd quarter			YTD			Year			3rd quarter			YTD			Year
Office
	External customers		407,661			1,297,269			1,758,200			471,302			1,414,654			1,912,112			-13.5%			-8.3%			-8.0%
	Intersegment		1,690			3,983			4,500			1,639			4,948			5,831			+3.1%			-19.5%			-22.8%
	Total sales		409,351			1,301,252			1,762,700			472,941			1,419,602			1,917,943			-13.4%			-8.3%			-8.1%
	Operating profit		41,148			152,306			199,900			67,777			190,671			259,265			-39.3%			-20.1%			-22.9%
	% of sales		10.1%			11.7%			11.3%			14.3%			13.4%			13.5%			-			-			-
Imaging System
	External customers		321,788			994,102			1,443,100			347,167			938,528			1,311,023			-7.3%			+5.9%			+10.1%
	Intersegment		298			1,194			1,600			275			751			1,021			+8.4%			+59.0%			+56.7%
	Total sales		322,086			995,296			1,444,700			347,442			939,279			1,312,044			-7.3%			+6.0%			+10.1%
	Operating profit		52,608			155,355			243,700			75,172			160,396			211,294			-30.0%			-3.1%			+15.3%
	% of sales		16.3%			15.6%			16.9%			21.6%			17.1%			16.1%			-			-			-
Industry and Others
	External customers		70,500			237,023			330,700			98,442			239,494			334,298			-28.4%			-1.0%			-1.1%
	Intersegment		22,442			64,049			85,500			25,342			67,339			86,565			-11.4%			-4.9%			-1.2%
	Total sales		92,942			301,072			416,200			123,784			306,833			420,863			-24.9%			-1.9%			-1.1%
	Operating profit		5,035			15,360			10,200			9,086			20,523			24,300			-44.6%			-25.2%			-58.0%
	% of sales		5.4%			5.1%			2.5%			7.3%			6.7%			5.8%			-			-			-
Corporate and Eliminations
	External customers		-			-			-			-			-			-			-			-			-
	Intersegment		(24,430	)		(69,226	)		(91,600	)		(27,256	)		(73,038	)		(93,417	)		-			-			-
	Total sales		(24,430	)		(69,226	)		(91,600	)		(27,256	)		(73,038	)		(93,417	)		-			-			-
	Operating profit		(27,914	)		(76,869	)		(97,800	)		(29,487	)		(88,129	)		(116,788	)		-			-			-
Consolidated
	External customers		799,949			2,528,394			3,532,000			916,911			2,592,676			3,557,433			-12.8%			-2.5%			-0.7%
	Intersegment		-			-			-			-			-			-			-			-			-
	Total sales		799,949			2,528,394			3,532,000			916,911			2,592,676			3,557,433			-12.8%			-2.5%			-0.7%
	Operating profit		70,877			246,152			356,000			122,548			283,461			378,071			-42.2%			-13.2%			-5.8%
	% of sales		8.9%			9.7%			10.1%			13.4%			10.9%			10.6%			-			-			-
(P)=Projection
3. OTHER INCOME / DEDUCTIONS																					(Millions of yen)
		2012									2011									Change year over year
		3rd quarter			YTD			Year (P)			3rd quarter			YTD			Year			3rd quarter			YTD			Year
	Interest and dividend, net		1,377			4,576			5,700			1,901			4,989			7,444			(524	)		(413	)		(1,744	)
	Forex gain (loss)		1,986			(1,347	)		(1,300	)		(6,496	)		(5,659	)		(3,287	)		+8,482			+4,312			+1,987
	Equity earnings (loss) of affiliated companies		247			674			900			(277	)		(5,654	)		(7,368	)		+524			+6,328			+8,268
	Other, net		693			3,394			2,700			589			4,787			(336	)		+104			(1,393	)		+3,036
	Total		4,303			7,297			8,000			(4,283	)		(1,537	)		(3,547	)		+8,586			+8,834			+11,547

(P)=Projection

- S2 -

Canon Inc.

4. BREAKDOWN OF PRODUCT SALES WITHIN BUSINESS UNIT


	2012									2011
	3rd quarter			YTD			Year (P)			3rd quarter			YTD			Year
Office
Monochrome copiers		16	%		16	%		16	%		15	%		15	%		15	%
Color copiers		19	%		19	%		19	%		17	%		17	%		17	%
Printers		44	%		44	%		44	%		49	%		48	%		48	%
Others		21	%		21	%		21	%		19	%		20	%		20	%
Imaging System
Cameras		71	%		71	%		71	%		74	%		71	%		71	%
Inkjet printers		22	%		21	%		22	%		21	%		24	%		24	%
Others		7	%		8	%		7	%		5	%		5	%		5	%
Industry and Others
Lithography equipment		14	%		18	%		15	%		17	%		17	%		19	%
Others		86	%		82	%		85	%		83	%		83	%		81	%

(P)=Projection

5. SALES GROWTH IN LOCAL CURRENCY (Year over year)


		2012
		3rd quarter			YTD			Year (P)
Office
	Japan		+1.6	%		+3.6	%		-
	Overseas		-14.4	%		-6.5	%		-
	Total		-11.4	%		-4.7	%		-5.2%
Imaging System
	Japan		+1.4	%		+10.5	%		-
	Overseas		-5.9	%		+9.7	%		-
	Total		-4.9	%		+9.8	%		+13.1%
Industry and Others
	Japan		-15.5	%		+5.4	%		-
	Overseas		-35.9	%		-4.3	%		-
	Total		-24.7	%		-1.2	%		-0.7%
Total
	Japan		-2.2	%		+5.7	%		+5.8%
	Overseas		-12.7	%		-0.1	%		+1.1%
	Americas		-9.6	%		-0.1	%		-0.7%
	Europe		-11.0	%		-3.1	%		-0.5%
	Asia and Oceania		-18.0	%		+4.0	%		+5.4%
	Total		-10.8	%		+1.0	%		+2.0%

(P)=Projection

- S3 -

Canon Inc.

6. PROFITABILITY


		2012						2011
		YTD			Year (P)			YTD			Year
ROE *1			8.8	%		9.3	%		9.7	%		9.6	%
ROA *2			5.7	%		6.1	%		6.3	%		6.3	%
												(P)=Projection
1 Based on Net Income attributable to Canon Inc. and Total Canon Inc. Stockholders’ Equity 2 Based on Net Income attributable to Canon Inc. 7. IMPACT OF FOREIGN EXCHANGE RATES
(1) Exchange rates															(Yen	)
		2012									2011
		3rd quarter			4th quarter (P)			Year (P)			3rd quarter			Year
Yen/US$			78.58			78.00			79.08			77.75			79.55
Yen/Euro			98.48			100.00			101.30			109.98			110.72
															(P)=Projection

(2) Impact of foreign exchange rates on sales (Year over year)					(Billions of yen)
		2012
		3rd quarter			Year (P)
	US$		+5.1			(5.8	)
	Euro		(23.0	)		(85.8	)
	Other currencies		+1.0			+0.4
	Total		(16.9	)		(91.2	)
						(P)=Projection

(3) Impact of foreign exchange rates per yen		(Billions of yen)
		2012
		4th quarter (P)
On sales
	US$		5.4
	Euro		2.6
On operating profit
	US$		2.5
	Euro		1.6
			(P)=Projection

8. STATEMENTS OF CASH FLOWS			(Millions of yen)
		2012						2011
		3rd quarter			Year (P)			3rd quarter			Year
Net cash provided by operating activities			63,848			385,000			151,758			469,562
Net cash used in investing activities			(43,256	)		(210,000	)		(128,692	)		(256,543	)
Free cash flow			20,592			175,000			23,066			213,019
Net cash used in financing activities			(125,569	)		(315,000	)		(125,135	)		(257,513	)
Effect of exchange rate changes on cash and cash equivalents			(1,460	)		(3,200	)		(34,919	)		(22,858	)
Net change in cash and cash equivalents			(106,437	)		(143,200	)		(136,988	)		(67,352	)
Cash and cash equivalents at end of period			567,610			630,000			711,631			773,227
												(P)=Projection

- S4 -

Canon Inc.


9. R&D EXPENDITURE		(Millions of yen)


		2012						2011
		3rd quarter			Year (P)			3rd quarter			Year
Office			24,854			-			24,182			103,378
Imaging System			19,471			-			20,801			82,731
Industry and Others			6,122			-			8,100			27,061
Corporate and Eliminations			22,028			-			24,901			94,630
	Total		72,475			295,000			77,984			307,800
% of sales			9.1%			8.4%			8.5%			8.7%
									(P)=Projection

10. INCREASE IN PP&E & DEPRECIATION AND AMORTIZATION		(Millions of yen)
		2012						2011
		3rd quarter			Year (P)			3rd quarter			Year
	Increase in PP&E		57,339			270,000			54,545			226,869
	Depreciation and amortization		64,322			255,000			62,941			261,343
												(P)=Projection

11. INVENTORIES
(1) Inventories		(Millions of yen)
		2012			2011			Difference
		Sep.30			Dec.31			Difference
Office			208,501			207,690			+811
Imaging System			259,419			148,954			+110,465
Industry and Others			123,201			120,060			+3,141
	Total		591,121			476,704			+114,417
(2) Inventories / Sales*		(Days)
		2012			2011			Difference
		Sep.30			Dec.31			Difference
	Office		44			39			+5
	Imaging System		68			38			+30
	Industry and Others		156			115			+41
	Total		63			46			+17
	*Index based on the previous six months sales.

12. DEBT RATIO
		2012			2011			Difference
		Sep.30			Dec.31			Difference
	Total debt / Total assets		0.1	%		0.3	%		-0.2	%

13. OVERSEAS PRODUCTION RATIO
		2012			2011
		YTD			Year
	Overseas production ratio		52	%		52	%

14. NUMBER OF EMPLOYEES
		2012			2011			Difference
		Sep.30			Dec.31			Difference
	Japan		70,562			70,346			+216
	Overseas		130,630			127,961			+2,669
	Total		201,192			198,307			+2,885

- S5 -