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Epson Q1 revenue up 5.6% to ¥297 billion despite shortages

Epson recorded ¥297.8 billion ($3.2 billion AUD) in revenue in the first quarter to June 30, 2022 as profit fell by 6.6% to ¥22.6 billion due to soaring transportation and parts costs. "Will implement dynamic pricing and cost control,” Epson said.

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Epson logo notag“The global economic growth rate began decelerating in the first quarter because of advancing inflation and moves by the U.S. and many other countries to tighten their monetary policies,” Epson said. “China’s zero-coronavirus policies and lockdowns had a particularly large impact, as they brought economic activity to a near standstill. The drawn-out war in Ukraine, chip shortages as well as shortages of certain other materials, and ongoing global supply chains disruptions caused by logistics delays have further clouded the economic outlook, so Epson will continue to closely watch trends going forward.

“Against this backdrop, Epson recorded ¥297.8 billion in revenue, which represents 5.6% revenue growth compared to the prior-year period. Although product shortages caused by parts constraints and logistics delays had a major negative impact on revenue, these were more than offset by the weakening of the yen in addition to action to raise or maintain higher selling prices.

“Business profit was ¥22.6 billion, down 6.6% from the prior-year period, because although we continue to contain costs chiefly by curtailing spending on advertising and promotions in accordance with revenue fluctuations, soaring transportation and parts costs increased our manufacturing costs. Profit from operating activities, which benefited from the recording of foreign exchange gains due to the appreciation of the U.S. dollar, ended at ¥31.2 billion, up 31.9% from the prior-year period. Profit before tax was ¥37.0 billion, up 57.8% from the prior-year period. Profit for the period attributable to owners of the parent company was ¥26.6 billion, up 52.5% from the prior-year period.”

Printing Solutions Segment

Revenue in the office and home printing business increased. High-capacity ink tank printer and ink cartridge printer unit sales decreased despite continued demand from people working and learning from home. Sales were hurt by product shortages due to lockdowns in China, logistics delays, and parts shortages. Nevertheless, printer revenue increased due to higher selling prices and the positive impact of foreign exchange rates.

Consumables revenue slightly increased because even though revenue was hurt by a decrease in ink cartridge sales owing to fewer sales of ink cartridge printers, sales of ink bottles for high-capacity ink tank printers increased.

Although negatively impacted by product shortages, revenue in the commercial and industrial printing business was in line with the prior-year period, helped in part by positive foreign exchange effects. 

Large-format inkjet printer revenue declined due to continued product shortages and the effects of lockdowns in China. 

Small printer revenue decreased even though we raised selling prices in Europe and the Americas, because we continued to experience product shortages.

The printhead sales business saw revenue decrease mainly because of lockdowns in China, the main market. The lockdowns resulted in logistics congestion and worsened some market conditions.

Revenue in the printing solutions segment was ¥197.6 billion, up 2.8% from the prior-year period. Segment profit was ¥21.0 billion, down 21.0% from the prior-year period.

FY2022 full-year outlook (vs. previous 4/28 outlook)

¥1,360.0B in revenue (+¥40.0B) and ¥100.0B in business profit (unchanged), ¥74.0B in profit for the year (+¥7.0B)

“We factored in a lowered outlook for unit sales due to supply constraints and the negative effects of further increases in materials and logistics costs, but will implement dynamic pricing and cost control,” said Epson.

Details here.