CANON INC.
 



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 June 30, 2003

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 August 28, 2003   By     /s/   Shunji Onda
   
    (Signature)*
 
     
 
    Shunji Onda
General Manager, Finance Division
Canon Inc.

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

 

The following materials are included.
1.   Interim report for the 103rd business term


 

(FRONT COVER PAGE)


 

To Our Shareholders

     It is a great pleasure to present our interim report for the first half of the 103rd business term, from January 1, 2003, through June 30, 2003.

     Looking back at domestic and overseas economies during this half-term, the U.S. economy continued a basic tone of sluggish growth in both personal consumption and investments in plants and equipment, but began exhibiting slight signs of recovery during the latter quarter. Due to restraint in export growth under the influence of the U.S. economy, the growth rates of European economies remained nearly level. Moreover, due to the adverse influence of SARS (Severe Acute Respiratory Syndrome) and other factors, Asian economies achieved only moderate growth. On the other hand, harsh conditions prevailed in the Japanese economy, which showed no signs of a favorable shift in personal consumption or investments in plants and equipment. In the foreign exchange market, in comparison with the same period of the previous year, the yen appreciated versus the U. S. dollar and depreciated versus Euro currency.

     In markets relevant to Canon, the demand for digital cameras continued to expand, but severe market conditions for digital copying machines and computer peripherals continued as price wars intensified. Regarding optical products, although the market for semiconductor production equipment remained stagnant, the market for mirror projection mask aligners for LCD panels expanded because of an increasing demand for LCD televisions and other factors.

     Within this management environment, Canon entered the third year of Phase II (2001 to 2005) of the “Excellent Global Corporation Plan.” Based on this plan, Canon continued to work toward reforming both production and development activities. For production reforms, Canon further advanced rationalization by such means as automating production and adopting mini-FA systems, thereby successfully achieving a further reduction in product cost. Moreover, as a consequence of development reforms, Canon was

 


 

able to release competitive products in a timely manner. In terms of sales activities as well, our business activities were able to accurately reflect market needs by reorganizing the Canon group and reinforcing closer communication among all member companies within the Canon group.

     Due to these efforts, despite a sluggish global economy we consecutively sustained a favorable performance during this first half of the 103rd business term. In comparison with the same period of the previous year, total sales amounted to 946.6 billion yen (a 17.1% increase) and ordinary profit totaled 164.3 billion yen (a 75.3% increase). Partially due to the gain on exemption from the substitutional portion of the employees’ pension fund (45.9 billion yen), net income was 128.8 billion yen (a 120.2% increase).

     The interim dividend for the first half of the 103rd business term amounts to 15 yen per share, representing a 2.50-yen increase versus that of the same period last year. Payment of dividends to shareholders commences on August 28, 2003.

     Regarding the outlook for the second half of the 103rd business term, the forecast of the global economy remains unpredictable although it will probably achieve a basic tone of moderate recovery, and the management environment of Canon is expected to remain in severe conditions. Under such circumstances, we intend to further strengthen our resolve and push forward extensive operational reforms in development, production, and sales, with the aim of increasing profitability and stabilizing performance.

     We hope that you will continue to extend even greater support and encouragement in the months ahead.

August 2003

FUJIO MITARAI
President & C.E.O.

 


 

BUSINESS REPORT BY OPERATIONS
The products mentioned below may have different names in other areas.

Sales by Operations

                   
              Increase/Decrease
Operations   Sales   against the Same Period
              of the Previous Term

 
 
      100 millions of yen   %
Business Machines
    6,842       9.5  
 
Office Imaging Products
    2,358       3.0  
 
Computer Peripherals
    4,484       13.2  

 
 
Cameras
    2,083       41.9  

 
 
Optical and Other Products
    541       48.3  

 
 
Total
    9,466       17.1  

 
 

Notes:

1.   From this interim period, amounts of less than 100 million are rounded off.
2.   From this interim period, representation of segmentation by product categories within the “Business Machines” are changed from the previous three segments of “Copying Machines,” “Computer Peripherals” and “Business Systems” to the two segments of “Office Imaging Products” and “Computer Peripherals.” In this connection, sales figures for the previous periods have been re-classified in accordance with the new segmentation.

Constitution of Sales
100 MILLIONS OF YEN

Sales by Operations   Sales by Region

(SALES BY OPERATIONS AND BY REGION PIE CHARTS)

 

2


 

Business Machines Operations

Office Imaging Products

     Fierce competition continued both in Japan and overseas within the markets for digital copying machines and multifunctional machines. As for monochrome digital copying machines for office use, sales of the “imageRUNNER Series” sustained a steady performance and, although sales of intermediate-speed models was sluggish, the sales quantity of the low-speed “iR1600 Series” models rose substantially. The high-speed models, as exemplified by the “iR105,” earned favorable acclaim, especially in the U.S. market. Furthermore, we strove to further expand the product lineup by releasing the “iR3350i Series” of new-generation multifunctional machines that offer the expandability of enhanced functions and diverse solutions when optional application software is installed.

     As for color digital copying machines, the “iR C3200” and “iR C3200N” network-compatible multifunctional machines for office use—equipped with Canon’s original, innovative iR controller—earned high acclaim in domestic and overseas markets and contributed to increased sales. Moreover, we also focused efforts on promoting the sales of the new “CLC1110” and other “PIXEL Series” color copying machines, which target graphic design businesses and design businesses.

     The market for products aimed for use at home or at small

Change in sales
100 MILLIONS OF YEN

(CHANGE IN SALES BAR CHART)

 

3


 

businesses, on the other hand, showed an increasing trend in the demand for digital multifunctional machines that possess the functions of a printer and facsimile machine as well as a copying machine. The “PC1255” and “PC1275” multifunctional laser printers sustained steady sales, and the new “Satera D350” and “Satera D300” also earned wide acclaim. While the shift toward multifunctional machines thus accelerated, we also endeavored to promote the sales of single-function copying machines in the “PC Series” and “FC Series” as well as single-function facsimile machines, such as the newly released “L500” laser facsimile machine.

     As a result, sales in this category increased 3.0% versus the same period last year.

Computer Peripherals

     The overall market for computer peripherals continued to face a harsh environment due to sluggish consumption caused by the economic slowdown in Japan and overseas, the intensification of price wars, and other factors. Amidst such circumstances, in the market for laser beam printers, we greatly increased our sales versus the same period last year due to the release of the color “Satera LBP-2410” in Japan and abroad and our efforts to expand its sales, a recovery in the sales of OEM-oriented products, and so forth.

     In the market for inkjet printers, on the other hand, the “PIXUS Series” posted favorable performance, with continued growth in the sales quantity of both the “PIXUS 550i” and “PIXUS 850i.” We also worked to enhance the product portfolio by releasing new products, including the super-compact, lightweight “PIXUS 50i” notebook-printer as well as the “PIXUS 470PD” Photo Direct model that can directly print photographs taken with a digital camera. In response to the rising domestic and overseas demand in the inkjet printer market for multifunctional machines equipped with the functions of a color printer, color copying machine, scanner, and facsimile, we released and posted favorable sales of the “PIXUS MP730” and “PIXUS MP700” inkjet multifunctional machines that achieve both versatile functions and high-speed printing.

4


 

     Whereas the demand for multifunctional machines rose, however, the sales of single-function inkjet facsimile machines was restrained. Despite the adverse influence of a shrinking market on the sales performance of our single-function scanners, we channeled efforts into expanding the sales of “CanoScan 9900F”— our new flagship of ultra-photorealistic scanners that takes advantage of Canon’s optical technology—and of the “CanoScan LiDE30” and other models in the “LiDE Series.”

     As a result of these efforts, sales in this category increased 13.2% versus the same period last year.

Change in sales
100 MILLIONS OF YEN

(CHANGE IN SALES BAR CHART)

5


 

Camera Operations

     Within the high growth in the domestic and overseas demand for digital cameras that has also continued into this half-term, we released five new models in the “PowerShot Series” and two new models in the “IXY DIGITAL Series” into the market for compact digital cameras, all of which earned high acclaim for their easy operation and high image quality thanks to the adoption of the “DIGIC” imaging engine and other innovations. Consequently, our sales growth in the market for the compact digital cameras exceeded that of the overall market.

     Regarding digital cameras of the single-lens reflex type, we released the “EOS 10D” which offers an affordable price while upholding high performance and subsequently generated a trend toward “full-fledged digitalization” among high-end amateur photographers as well. As for silver-halide cameras, we released the medium-grade “Autoboy N115” and other models then strove to increase their sales, but sales declined due to a shrinking demand. Sales of EF exchangeable lenses steadily increased on the basis of their compatibility with single-lens reflex cameras of both digital and silver-halide types. In the market for digital video cameras, we worked to strengthen the product lineup by releasing three new models, including the “FV M10 KIT” in the “Torebian Series,” and successfully continued to expand sales.

     Consequently, sales in this category increased 41.9% versus the same period last year.

Change in sales
100 MILLIONS OF YEN

(CHANGE IN SALES BAR CHART)

6


 

Optical and Other Products Operations

     While semiconductor manufacturers continued to curb new investments in view of the slump in the semiconductor market, we initiated shipments of the “FPA-5000ES4” high-resolution Krf scanning stepper and other models and mainly increased sales of equipment for the increased production of CCDs (Charge-Coupled Devices) for Japanese consumption. Compared to the same period last year when the sales of semiconductor production equipment was sluggish, therefore, sales rose during the current half-term.

     Regarding mirror projection mask aligners for LCD panels, on the other hand, thanks to the shift to LCD panels as display monitors for personal computers and the expanded market for LCD televisions, mirror projection mask aligners capable of handling large-format LCD panels enjoyed a lively demand and the sales of “MPA-7500” continued to rise favorably. In addition, the newly released “MPA-7800,” which is capable of handling even larger panels (1,200 x 1,300 mm), exhibited steady sales after entering the market.

     Despite a slump in the market for broadcasting equipment, we sustained steady performance by such efforts as the release of the “DIGISUPER 100 xs,” a broadcasting lens that achieves a zoom rate of 100x and which won high praise for its vivid and powerful images during live sports broadcasts. Moreover, in the market for medical equipment, we endeavored to increase the sales of our digital non-mydriatic retinal cameras and X-ray digital cameras.

     As a result, sales in this category increased 48.3% versus the same period last year.

Change in sales
100 MILLIONS OF YEN

(CHANGE IN SALES BAR CHART)

7


 

Balance Sheets

                     
ASSETS   Millions of yen

 
        As of June 30,   As of Dec 31,
        2003   2002
       
 
Current Assets
    1,027,318       952,082  
   
Cash and deposits
    155,571       64,262  
   
Notes receivable
    198,821       213,014  
   
Accounts receivable
    344,421       364,357  
   
Marketable securities
    99       474  
   
Finished goods
    91,111       73,620  
   
Work in process
    105,764       99,614  
   
Raw materials and supplies
    3,235       3,069  
   
Deferred tax assets
    23,183       22,722  
   
Short-term loans receivable
    29,270       30,294  
   
Other current assets
    85,896       91,636  
   
Allowance for doubtful receivables
    (10,053 )     (10,986 )
 
   
     
 
Fixed Assets
    896,004       896,054  
 
Property, Plant and Equipment
    451,556       440,501  
   
Buildings
    217,887       223,245  
   
Machinery
    84,000       79,019  
   
Vehicles
    193       218  
   
Tools and equipment
    45,721       43,297  
   
Land
    90,720       80,326  
   
Construction in progress
    13,035       14,393  
 
Intangibles
    22,940       27,668  
   
Industrial property rights
    185       112  
   
Facility utility rights
    485       501  
   
Software
    22,270       27,054  
 
Investments
    421,508       427,884  
   
Marketable securities-noncurrent
    40,934       33,278  
   
Investment in subsidiaries
    295,004       282,231  
   
Long-term loans receivable
    6,274       4,587  
   
Long-term pre-paid expenses
    9,569       10,986  
   
Deferred tax assets-noncurrent
    64,394       89,082  
   
Guarantees
    3,179       3,350  
   
Other noncurrent assets
    2,197       4,420  
   
Allowance for doubtful receivables-noncurrent
    (43 )     (52 )
 
   
     
 
TOTAL ASSETS
    1,923,322       1,848,136  
 
   
     
 
                 
Notes:                
1.      
From this interim period, amounts less than 1 million are rounded off.
       
2.    
Current receivable from subsidiaries
  611,012 million yen
       
Noncurrent receivable from subsidiaries
  6,236 million yen
       
Current payable to subsidiaries
  216,059 million yen
3.    
Accumulated depreciation of property, plant and equipment
  580,732 million yen

8


 

LIABILITIES AND STOCKHOLDERS’ EQUITY

                     
        Millions of yen
       
        As of June 30,   As of Dec 31,
        2003   2002
       
 
 
Current Liabilities
    455,701       441,106  
   
Notes payable
    14,140       20,698  
   
Accounts payable
    251,043       259,202  
   
Short-term loans
    57,652       53,772  
   
Other payable
    14,152       9,314  
   
Accrued expenses
    36,952       19,011  
   
Accrued income taxes
    58,280       62,629  
   
Deposits
    9,278       6,026  
   
Accrued bonuses for employees
    4,441       4,491  
   
Other current liabilities
    9,763       5,960  
 
Noncurrent Liabilities
    117,856       171,720  
   
Convertible debenture
    13,750       15,031  
   
Long-term debts
    1       1  
   
Accrued pension and severance cost
    104,105       156,687  
 
 
   
     
 
TOTAL LIABILITIES
    573,557       612,827  
 
 
   
     
 
 
Common Stock
    167,883       167,242  
 
Capital Surplus
    299,419       298,778  
   
Additional paid-in capital
    299,419       298,778  
 
Retained Earnings
    887,562       774,287  
   
Legal reserve
    22,114       22,114  
   
Reserve for special depreciation
    3,896       3,753  
   
Reserve for deferral of capital gain on property
    10       13  
   
Special reserves
    719,428       604,028  
   
Unappropriated retained earnings
    142,114       144,379  
 
Net Unrealized Gains (Losses) on Securities
    1,624       1,162  
 
Treasury Stock
    (6,723 )     (6,162 )
 
 
   
     
 
TOTAL STOCKHOLDERS’ EQUITY
    1,349,765       1,235,309  
 
 
   
     
 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
    1,923,322       1,848,136  
 
 
   
     
 
                   
4.      
Contingent liabilities
       
         
Guarantees
  55,671 million yen
         
Letter of awareness and others
  1,219 million yen

9


 

Income Statements

                     
        Millions of yen
       
        Six months ended   Six months ended
        June 30, 2003   June 30, 2002
       
 
OPERATING PROFIT AND LOSS
               
 
Operating Revenue
    946,551       808,357  
   
Net sales
    946,551       808,357  
 
Operating Expenses
    792,160       718,506  
   
Cost of sales
    569,687       525,023  
   
Selling, general and administrative expenses
    222,473       193,482  
 
 
   
     
 
OPERATING PROFIT
    154,391       89,851  
 
 
   
     
 
OTHER INCOME AND EXPENSE
               
 
Other Income
    25,048       27,141  
   
Interest income
    258       298  
   
Dividend income
    3,685       8,313  
   
Rental income
    4,521       3,597  
   
Patent royalties
    10,638       9,320  
   
Miscellaneous income
    5,946       5,611  
 
Other Expense
    15,146       23,294  
   
Interest expense
    129       124  
   
Discount charge for export bills
    4       28  
   
Depreciation of rental assets
    4,017       3,170  
   
Loss on disposal and write-off of inventories
    5,071       2,953  
   
Foreign exchange loss
    3,592       14,082  
   
Miscellaneous loss
    2,333       2,934  
 
 
   
     
 
ORDINARY PROFIT
    164,293       93,698  
 
 
   
     
 
NON-ORDINARY INCOME AND LOSS
               
 
Non-Ordinary Income
    46,414       375  
   
Gain on sales of fixed assets
    7       375  
   
Gain on sales of investments in subsidiaries
    527        
   
Gain on exemption from the substitutional portion of the employees’ pension fund
    45,880        
 
Non-Ordinary Loss
    2,588       3,521  
   
Loss on sales and disposal of fixed assets
    2,588       1,818  
   
Loss on write-off of investments in subsidiaries
          1,703  
 
 
   
     
 
INCOME BEFORE INCOME TAXES
    208,119       90,551  
   
Income taxes — Current
    59,199       32,782  
   
                      — Deferred
    20,145       (709 )
 
 
   
     
 
NET INCOME
    128,775       58,478  
   
Unappropriated retained earnings brought forward from previous term
    13,340       11,154  
   
Loss on sales of treasury stock
    1        
 
 
   
     
 
UNAPPROPRIATED RETAINED EARNINGS
    142,114       69,633  
 
 
   
     
 
                   
Notes:                  
1.      
From this interim period, amounts less than 1 million are rounded off.
       
2.    
Transactions with subsidiaries:
       
         
Sales
  916,107 million yen
         
Purchase
  519,870 million yen
         
Other transaction
  21,353 million yen
3.    
Net income per share
  146.69 yen

10


 

Change in Sales
100 MILLIONS OF YEN

(SALES BAR CHART)

Change in Ordinary Profit
100 MILLIONS OF YEN

(PROFIT BAR CHART)

Change in Net Income
100 MILLIONS OF YEN

(NET INCOME BAR CHART)

11


 

CONSOLIDATED RESULTS
Canon’s consolidated financial statements conform with accounting principles generally accepted in the United States of America.

Consolidated Balance Sheets

ASSETS

                   
              Millions of yen
             
      As of June 30,   As of Dec. 31,
      2003   2002
      (Unaudited)   (Audited)
     
 
Current assets:
               
 
Cash and cash equivalents
    591,130       521,271  
 
Marketable securities
    1,414       7,255  
 
Trade receivables, less allowance
    497,195       498,587  
 
Inventories
    475,914       432,251  
 
Prepaid expenses and other current assets
    266,505       245,610  
 
 
   
     
 
Total current assets
    1,832,158       1,704,974  
Noncurrent receivables
    17,089       20,568  
Investments
    66,117       64,037  
Net property, plant and equipment
    855,176       830,304  
Other assets
    349,548       322,823  
 
 
   
     
 
Total Assets
    3,120,088       2,942,706  
 
 
   
     
 

LIABILITIES AND STOCKHOLDERS’ EQUITY

                   
              Millions of yen
             
      As of June 30,   As of Dec. 31,
      2003   2002
      (Unaudited)   (Audited)
     
 
Current liabilities:
               
 
Short-term loans
    59,428       66,754  
 
Trade payables
    419,687       408,464  
 
Income taxes
    76,153       80,169  
 
Accrued expenses
    173,417       154,621  
 
Other current liabilities
    99,310       91,832  
 
 
   
     
 
Total current liabilities
    827,995       801,840  
Long-term debt, excluding current installments
    86,188       81,349  
Accrued pension and severance cost
    271,805       285,129  
Other noncurrent liabilities
    30,735       26,193  
 
 
   
     
 
Total Liabilities
    1,216,723       1,194,511  
 
 
   
     
 
Minority interests
    158,348       156,245  
Stockholders’ equity:
               
 
Common stock
    167,883       167,242  
 
Additional paid-in capital
    394,846       394,088  
 
Retained earnings
    1,315,655       1,203,248  
 
Accumulated other comprehensive income (loss)
    (126,644 )     (166,467 )
 
Treasury stock
    (6,723 )     (6,161 )
 
 
   
     
 
Total Stockholders’ Equity
    1,745,017       1,591,950  
 
 
   
     
 
Total Liabilities and Stockholders’ Equity
    3,120,088       2,942,706  
 
 
   
     
 
                           
                      Millions of yen
                     
              As of June 30,   As of Dec. 31,
              2003   2002
              (Unaudited)   (Audited)
             
 
1.      
Allowance for doubtful receivables
    15,113       12,031  
2.      
Accumulated depreciation
    1,104,216       1,077,694  
3.      
Accumulated other comprehensive income (loss):
               
         
Foreign currency translation adjustments
    (44,574 )     (68,524 )
         
Net unrealized gains (losses) on securities
    54       (1,168 )
         
Minimum pension liability adjustments
    (80,047 )     (96,441 )
         
Net gains (losses) on derivative financial instruments
    (2,077 )     (334 )
4.      
The number of consolidated subsidiaries as of June 30, 2003 was 202, and the number of companies accounted for on equity basis as of June 30, 2003 was 20.
               

12


 

Consolidated Statements of Income

                     
                Millions of yen
               
        Six months ended   Six months ended
        June 30, 2003   June 30, 2002
        (Unaudited)   (Unaudited)
       
 
Net sales
    1,535,588       1,384,483  
Cost of sales
    759,714       734,221  
 
   
     
 
   
Gross profit
    775,874       650,262  
Selling, general and administrative expenses
    559,900       510,234  
 
   
     
 
   
Operating profit
    215,974       140,028  
Other income (deductions):
    (468 )     (12,833 )
 
Interest and dividend income
    4,630       4,734  
 
Interest expense
    (2,650 )     (3,482 )
 
Other, net
    (2,448 )     (14,085 )
 
   
     
 
   
Income before income taxes
    215,506       127,195  
Income taxes
    82,801       51,539  
Minority interests
    4,938       2,451  
 
   
     
 
   
Net income
    127,767       73,205  
 
   
     
 

Notes:

1.   The basic earnings per share is ¥145.55.
2.   Canon’s comprehensive income consists of net income, change in foreign currency translation adjustments, change in net unrealized gains and losses on securities, change in minimum pension liability adjustments and change in net gains and losses on derivative financial instruments. Comprehensive income for six months ended June 30, 2003 and 2002 were ¥167,590 million and ¥53,370 million, respectively.

Constitution of Sales
100 MILLIONS OF YEN

     
Sales by Operations   Sales by Region
(SALES BY OPERATIONS PIE CHARTS)

Note:

From this interim period, Canon has revised the product categories contained within the “Business Machines” segment and discloses “Office Imaging Products,” “Computer Peripherals” and “Business Information Products.”

13


 

COMPANY PROFILE

(The following statements are the status as of June 30, 2003, if not specified otherwise.)

Main Activities
The Company is engaged in the manufacture and sales of the following products.

Business Machines
Office Imaging Products
     Copying Machines, Digital Multifunctional Machines, Laser Facsimile

Computer Peripherals
     Laser Beam Printers, Ink Jet Printers, Ink Jet Multifunctional Machines/Facsimile Machines, Scanners

Cameras
Digital Cameras, Silver Halide Cameras, Digital Video Cameras, Interchangeable Lenses

Optical and Other Products
Semiconductor Production Equipment, Mirror Projection Mask Aligners for LCD Panels, TV Lenses for Broadcasting Stations, Ophthalmic Instruments, X-Ray Equipment, Medical Image Recording Equipment

Shares
Total Number of Shares Issuable is 2,000,000,000 shares.

Total Outstanding Shares, Capital Stock and Number of Shareholders

           
Total Outstanding Shares (share)
       
 
As of the end of the Previous Term
    879,136,244  
 
Increase during This Half-Term
    855,710  
 
As of the end of This Half-Term
    879,991,954  
Capital Stock (yen)
       
 
As of the end of the Previous Term
    167,242,433,582  
 
Increase during This Half-Term
    640,926,790  
 
As of the end of This Half-Term
    167,883,360,372  
Number of Shareholders (person)
       
 
As of the end of the Previous Term
    34,148  
 
Decrease during This Half-Term
    1,328  
 
As of the end of This Half-Term
    32,820  

Note:
The increase of the total outstanding shares and the capital stock during this half term reflects the conversion of convertible debentures into shares.

14


 

Ratio of Holdings by Shareholders

(RATIO OF HOLDINGS CHART)

The Company’s Own Shares

                                 
Acquisition during this   Disposition during this        
Half-Term   Half-Term        

 
  Number of Own
    Total Amount           Total Amount   Shares as of the
Number of   of Acquisition   Number of   of Disposition   end of this
Shares   Price   Shares   Price   Half-Term

 
 
 
 
Common stock
          Common stock           Common stock
111,804 shares
  545 million yen   9,050 shares   40 million yen   1,476,311 shares
             
Notes     1.     The acquisitions and dispositions during this half-term reflect the purchase and sales of less- than-one-unit shares, respectively.
      2.     There were no share annulment procedures with respect to the Company’s own shares during this half-term.
      3.     The number of the Company’s own shares as of the end of the previous term was 1,373,557 shares of common stock.

Convertible Debentures
MILLIONS OF YEN

(CONVERTIBLE DEBENTURES CHSART)

Employees

         
Number of Employees (person)
    18,896  
Decrease from the Previous Term (person)
    845  
Average Age
    38.6  
Average years of Service
    16.1  

Notes:

1.   Number of employees represents the total number of employees (excluding those who do not work full-time).
2.   In addition to the employees listed above, 1,734 persons have been dispatched to affiliated companies, etc.

15


 

Directors and Corporate Auditors

         
Position   Name   Business in Charge or Main Occupation

 
 
President & C.E.O.   Fujio Mitarai    
Senior Managing Director   Ichiro Endo   Group Executive of Technology Management Headquarters
Senior Managing Director   Yukio Yamashita   Group Executive of Human Resources Management & Organization Headquarters
Senior Managing Director   Toshizo Tanaka   Group Executive of Finance & Accounting Headquarters
Senior Managing Director   Kinya Uchida   President of Canon U.S.A., Inc.
Senior Managing Director   Akira Tajima   Chief Executive of Optical Products Operations
Senior Managing Director   Tsuneji Uchida   Chief Executive of Image Communications Products Operations
Managing Director   Takashi Saito   Deputy Managing Director of Canon Europe Ltd.
Managing Director   Yusuke Emura   Group Executive of Global Environment Promotion Headquarters
Managing Director   Nobuyoshi Tanaka   Group Executive of Corporate Intellectual Property and Legal Headquarters
Managing Director   Junji Ichikawa   Group Executive of Production Management Headquarters
Managing Director   Hajime Tsuruoka   President of Canon Europa N.V.
Managing Director   Akiyoshi Moroe   Group Executive of General Affairs Headquarters; Group Executive of Information & Communication Systems Headquarters
Managing Director   Kunio Watanabe   Group Executive of Corporate Strategy & Development Headquarters
Managing Director   Ikuo Soma   Chief Executive of Office Imaging Products Operations
Director   Teruomi Takahashi   Chief Executive of Chemical Products Operations
Director   Hironori Yamamoto   Group Executive of Core Technology Development Headquarters; Group Executive of Display Developments Headquarters
Director   Yoroku Adachi   President of Canon (China) Co., Ltd.
Director   Yasuo Mitsuhashi   Chief Executive of Peripheral Products Operations
Director   Katsuichi Shimizu   Chief Executive of Inkjet Products Operations
Director   Ryoichi Bamba   Executive Vice President of Canon U.S.A., Inc.
Director   Tomonori Iwashita   Deputy Chief Executive of Image Communications Products Operations
Director   Toshio Homma   Group Executive of New Business Headquarters
Director   Shigeru Imaiida   Deputy Group Executive of Production Management Headquarters
Corporate Auditor   Kohtaro Miyagi    
Corporate Auditor   Masaharu Aono    
Corporate Auditor   Tadashi Ohe   Attorney
Corporate Auditor   Tetsuo Yoshizawa    

Note:
Corporate Auditors Mr. Tadashi Ohe and Mr. Tetsuo Yoshizawa are the outside Corporate Auditors stipulated in Article 18, Paragraph 1 of the Law Regarding Exceptional Rules of the Commercial Code Concerning Auditing, etc. of Stock Corporation.

16


 

INFORMATION ON SHARES

               
Closing of accounts:
 
December 31 of each year
 
Ordinary general meeting of shareholders:
 
March of each year
 
Record date for the above:
 
December 31 of each year
 
Otherwise, if necessary, public notice will be given in advance in accordance with a resolution by the board of directors.
 
Certain date for interim dividends:
 
June 30 of each year
 
Transfer agent:
 
Mizuho Trust & Banking Co., Ltd.
 
2-1, Yaesu 1-chome, Chuo-ku, Tokyo
 
   
Business handling place of the agent:
     
Head Office of Stock Transfer Agency Department,
     
Mizuho Trust & Banking Co., Ltd.
 
   
Mailing address and telephone number of the agent:
     
Business Office of Stock Transfer Agency Department
     
Mizuho Trust & Banking Co., Ltd.
     
17-7, Saga 1-chome, Koto-ku, Tokyo 135-8722
     
Telephone: (03)5213-5213
 
   
Intermediary offices:
     
Branches of Mizuho Trust & Banking Co., Ltd.
     
Head Office and Branches of Mizuho Investors Securities Co., Ltd.
 
Number of shares to constitute one unit of shares:
 
1,000 shares
 
Newspaper in which public notice is inserted:
 
The Nihon Keizai Shimbun published in Tokyo
 
Listed stock exchange:
 
Tokyo, Osaka, Nagoya, Fukuoka, Sapporo, New York and Frankfurt am Main
 
Fee for issuing share certificate:
 
The amount equivalent to stamp duty for issue of each new share certificate

 


*Mizuho Asset Trust & Banking Co., Ltd., one of the intermediary offices for the transfer agent, has merged with Mizuho Trust & Banking Co., Ltd. as of March 12, 2003.

17


 

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