Well, now that the numbers are in for 2013 and we\u2019re lumbering through the first quarter of 2014, I think it\u2019s safe to say that the recovery\u2014such as it is\u2014has arrived. The market in North America has demonstrated continued improvement over the past couple of years and Europe is sputtering back to life. Japan also looks poised for growth as its GDP makes modest gains, and economic conditions in other Asian countries such as India have likewise strengthened. Hardware manufacturers are reporting that total unit shipments worldwide are up and most companies are seeing some degree of revenue growth and improved profitability.<\/p>\n
When the Great Recession ended, we had high hopes that the market would come roaring back to life and we\u2019d return to the market of 2008, where sustained growth was the norm and annually declines were unheard of. That was not to be, of course. Instead, we faced several years of interrupted recovery. After a rocky 2010, the natural disasters in Asia in 2011 stymied economic growth and led to supply chain problems, which was followed by another year of uncertainty as Europe grappled with the region\u2019s sovereign debt crisis in 2012. Well, all that appears to be behind us now and while the growth in the U.S. market is still short of robust, at least it has been ongoing.<\/p>\n
I think that it\u2019s now clear to most of us that we\u2019ll never get back to 2008. The measures that companies have employed to better manage their printing costs have worked. Various services have been rolled out to help firms better operate and monitor their printing environments and processes. Cost-containment efforts taken by most companies have driven down output, and as the demand for hardcopy has declined, so has the need for new hardware and supplies. Sad but true. With that said, however, most companies in the printer and copier space are doing far better than they have done in a long time. After years of slumping sales, it appears we are on the road to sustainable growth albeit modest.<\/p>\n
It Is What It Is<\/strong><\/p>\n In the waning days of January and throughout February, hardware manufacturers reported their earnings for most\u2014or all\u2014of 2013. Helped by a weaker yen, many of the Japanese companies had good news to report. While there is still plenty of room for improvement, the U.S.-based OEMs also reported that the 2013 reported market is showing the most promise since the recession.<\/p>\n Xerox<\/strong> is typically among the first manufacturers to report its financial results during earnings season and such was the case in the recent quarter. On January 27, the firm said that it experienced slight declines in sales and profits in the fourth quarter of 2013 as well as for the entire fiscal year. Xerox\u2019s quarterly revenue declined 3 percent from $5.8 billion to $5.6 billion, while annual revenue declined 1 percent from $21.7 billion to $21.4 billion. The firm\u2019s operating margin slipped 1.3 points to 9.3 percent during the fourth-quarter as net income tumbled 9 percent from $335 million in the fourth quarter of 2012 to $306 million. Full-year net income was $1.159 billion, off about 3 percent from $1.195 billion in fiscal 2012. CEO Ursula Burns observed that the lackluster results were in line with the firm\u2019s previous guidance and indicated the company is well positioned for 2014.<\/p>\n Lexmark<\/strong> reported the day after Xerox saying it had finished the year with a stronger than expected fourth quarter. Lexmark had revenue of $1.006 billion, up 4 percent from $967.4 million in the year-ago period. For the full year, Lexmark did not do as well with total annual revenue down 3.4 percent from $3.798 billion in 2012 to $3.668 billion in 2013. Although down, the company said that excluding the negative impact of its inkjet business, revenue for the full year would have actually increased 4 percent. Lexmark\u2019s operating margin was 15.0 percent in the fourth quarter versus a mere 6.3 percent in the fourth quarter of 2012. For all of fiscal 2013, the company had an operating margin of 11.2 percent more than double the 5.0 percent recorded in 2012. Net earnings also improved significantly in the fourth quarter skyrocketing some 257 percent from $26.3 million in the fourth quarter of 2012 to $94 million last year. Lexmark\u2019s net earnings also experienced strong gains, surging 143 percent from $107.6 million in 2012 to $261.8 million this year.<\/p>\n Of the three U.S.-based OEMs, Hewlett-Packard<\/strong>\u2019s printer business was strongest last year and it appears that will be the case in 2014. The firm\u2019s fiscal year runs from November 1 until October 31 and on February 26 it reported its first quarter financial results for fiscal 2014. Revenue from HP\u2019s former Imaging and Printing Group (IPG) dropped from $5.9 billion in 2012 to $5.8 billion, which represented a decline of about 2 percent. The good news was that the group\u2019s unit shipments were up and it achieved an operating margin of 16.8 percent, up 700 basis points compared to the first quarter of 2013. Although IPG\u2019s revenue continues to hover at the levels recorded during the recession, for the past seven quarters, its operating profits have been at or above 15.5 percent. The group\u2019s earnings before taxes reached $979 million in the first quarter of this year compared to $967 last year.<\/p>\n Better In Japan<\/strong><\/p>\n Although it missed its guidance, Canon reported on January 29 that it had grown full-year sales and profits for the first time in three years. The firm declared it is becoming \u201cincreasingly apparent\u201d that the worldwide economy will recover in 2014. Canon had net sales of \u00a51.035 trillion compared with \u00a5951.4 billion in the fourth quarter of fiscal 2012, an 8.8 percent increase. For the full year, Canon\u2019s sales totaled \u00a53.731 trillion, a 7.2 percent increase from \u00a53.480 trillion in fiscal 2012. Canon said in addition to the positive effects of favorable currency exchange rates it experienced \u201csteady sales growth for MFDs and laser printers, along with an increase in sales of inkjet printers, made possible through sales-promotion efforts despite the harsh conditions posed by the shrinking inkjet printer market.\u201d The company\u2019s operating profit for the quarter was \u00a593.5 billion, up 20.4 percent from \u00a577.7 billion the year prior and its operating profit for the entire fiscal year was \u00a5337.3 billion, up 4.1 percent from \u00a5323.9 billion in 2012.<\/p>\n Konica Minolta<\/strong> also reported stronger year-over-year revenue and profit growth at the end of January thanks to the weaker yen and significant growth in sales of A3 color MFPs and color and monochrome production printers. For its third quarter, which ended on December 31, 2013, the firm reported net sales of \u00a5232.4 billion, up 19.9 percent from \u00a5193.9 billion during the same period in 2012. For the first nine months of its current fiscal year, which ends in March, Konica Minolta had net sales of \u00a5682.9 billion, an 18.2 percent improvement from its net sales of \u00a5577.7 billion during the first nine months of 2012. Up 116.2 percent to \u00a514.7 billion from \u00a56.8 billion in the third quarter in 2012, Konica Minolta\u2019s operating income improved dramatically during the third quarter and net income jumped 94.0 percent from \u00a52.7 billion in 2012 to \u00a55.2 billion. For the entire year, Konica Minolta currently forecasts total sales growing 14.4 percent, with operating income up 38.8 percent growth, and net income gaining 19 percent.<\/p>\n Ricoh<\/strong> reported on January 31 that its financial performance also improved with solid growth in its production printing business along with improved sales of managed document services (MDS) and color MFPs. For the three-month period ending December 31, Ricoh\u2019s net sales totaled \u00a5555.9 billion, an 18.4 percent increase over last year\u2019s third quarter. Ricoh\u2019s operating profit margin reached 5.8 percent as the company\u2019s operating income soared 147 percent from the year-ago period to \u00a532.3 billion. Net income for the third quarter was nearly \u00a518.9 billion, a gain of 237 percent compared to the third quarter of 2013. For the nine-month period from April 1 to December 31, 2013, Ricoh\u2019s net sales totaled \u00a51.612 trillion, marking a 16.2 percent year-over-year increase from \u00a51.387 trillion in the previous fiscal year. Ricoh raised its net sales guidance of \u00a52.18 trillion, which was given in October, to \u00a52.2 trillion. The company lowered its operating income outlook from \u00a5140.0 billion to \u00a5120.0 billion, however, and now expects net income of only \u00a570.0 billion rather than the \u00a580.0 billion previously forecasted.<\/p>\n On February 4, Brother<\/strong> announced that it had net sales of \u00a5163.5 billion during its third quarter, a 23.2 percent increase from \u00a5132.7 billion in the year-ago period. Third-quarter operating income for the firm totaled \u00a511.4 billion versus \u00a56.1 billion in the previous fiscal year, up 85.8 percent. Net income also improved dramatically from last year\u2019s Q3 net loss of \u00a52.6 billion to net income of \u00a55.3 billion in the third quarter of the current fiscal year. Printer sales helped fuel the company\u2019s overall growth. Net sales for Brother\u2019s Printing and Solutions business totaled \u00a5115.4 billion in the third quarter, up 23.3 percent from \u00a593.6 billion in last year\u2019s third quarter. Within this segment, sales of communications and printing equipment were \u00a5103.6 billion, up 23.3 percent year-over-year. The Printing and Solutions business\u2019s third-quarter operating income was \u00a58.4 billion, up a robust gain of 136.9 percent from the year-ago period. For the full year ending in March 2014, Brother anticipates that sales in its Printing and Solutions business will total \u00a5431.4 billion with sales of communications and printing equipment accounting for \u00a5384.9 billion of that total. The Printing and Solutions group\u2019s operating income for the year is expected to be \u00a527.3 billion.<\/p>\n After experiencing steady declines in net sales and significant operating losses for several years, OKI<\/strong> Electric Industry\u2019s efforts to improve its printer business appears to be bearing fruit. OKI President Hideichi Kawasaki commented that performance of each of the firm\u2019s main business segments was steady and \u201cthere was a sense of overall economic recovery.\u201d The company does not break out quarterly results separately in its financial statements. Instead, it reported results in early February for the period from April 1, 2013, to December 31, 2013 during which time OKI had net sales of \u00a5317.8 billion, a 4.6 percent improvement from its sales of \u00a5303.7 billion in the first nine months of the previous fiscal year. Although OKI had had an operating loss of \u00a50.7 billion and a net loss of \u00a51.3 billion during the first nine months of the last fiscal year, in the first nine months of the current year its operating income was \u00a510.4 billion and net income totaled \u00a514.5 billion. Net sales in OKI\u2019s printer business totaled \u00a589.2 billion for the first nine months of the current fiscal year versus \u00a581.5 billion in the year-ago period, an improvement of 9.4 percent. The group\u2019s operating income in the current fiscal year stands at \u00a51.3 billion versus last year\u2019s operating loss of \u00a59.0 billion. Unit sales of both color and monochrome LED printer declined as OKI sought to better define its sales strategies. The company said sales of its newer models designed to compete against copiers, however, were favorable.<\/p>\n Because of the way that certain firms like Samsung report their quarterly financial results, it is impossible to glean any insight into their actual printer and copier business. As a result, we do not cover certain firms. Anecdotally, however, I have been hearing that Samsung continues to make inroads into the U.S. market, although shipments of its low-end machines appear to have been off in the past year. I assume that other firms such as Sharp and Toshiba are doing okay\u2014or even better than okay\u2014in the U.S. Recent news from Sharp that it will supply HP with engines for LaserJet-branded copiers ought to give the Japanese firm a nice shot in the arm when they hit the market.<\/p>\n So, all in all, I think that 2014 will be a pretty good year for our industry. Of course, there is plenty of uncertainty and doubt. As I wrote this piece, for example, the situation in the Crimea was tense and the world economy will surely suffer if a major dustup occurs in Ukraine or some other region. But failing something catastrophic, I expect the markets to continue to strengthen this year and the industry to grow modestly.<\/p>\n","protected":false},"excerpt":{"rendered":" Well, now that the numbers are in for 2013 and we\u2019re lumbering through the first quarter of 2014, I think it\u2019s safe to say that the recovery\u2014such as it is\u2014has arrived. The market in North America has demonstrated continued improvement over the past couple of years and Europe is sputtering back to life. Japan also looks poised for growth as its GDP makes modest gains, and economic conditions in other Asian countries such as India have likewise strengthened. Hardware manufacturers are reporting that total unit shipments worldwide are up and most companies are seeing some degree of revenue growth and improved profitability. When the Great Recession ended, we had high hopes that the market would come roaring back to life and we\u2019d return to the market of 2008, where sustained growth was the norm and annually declines were unheard of. That was not to be, of course. Instead, we faced several years of interrupted recovery. After a rocky 2010, the natural disasters in Asia in 2011 stymied economic growth and led to supply chain problems, which was followed by another year of uncertainty as Europe grappled with the region\u2019s sovereign debt crisis in 2012. Well, all that appears to be behind us now and while the growth in the U.S. market is still short of robust, at least it has been ongoing. I think that it\u2019s now clear to most of us that we\u2019ll never get back to 2008. The measures that companies have employed to better manage their printing costs have worked. Various services have been rolled out to help firms better operate and monitor their printing environments and processes. Cost-containment efforts taken by most companies have driven down output, and as the demand for hardcopy has declined, so has the need for new hardware and supplies. Sad but true. With that said, however, most companies in the printer and copier space are doing far better than they have done in a long time. After years of slumping sales, it appears we are on the road to sustainable growth albeit modest. It Is What It Is In the waning days of January and throughout February, hardware manufacturers reported their earnings for most\u2014or all\u2014of 2013. Helped by a weaker yen, many of the Japanese companies had good news to report. While there is still plenty of room for improvement, the U.S.-based OEMs also reported that the 2013 reported market is showing the most promise since the recession. Xerox is typically among the first manufacturers to report its financial results during earnings season and such was the case in the recent quarter. On January 27, the firm said that it experienced slight declines in sales and profits in the fourth quarter of 2013 as well as for the entire fiscal year. Xerox\u2019s quarterly revenue declined 3 percent from $5.8 billion to $5.6 billion, while annual revenue declined 1 percent from $21.7 billion to $21.4 billion. The firm\u2019s operating margin slipped 1.3 points to 9.3 percent during the fourth-quarter as net income tumbled 9 percent from $335 million in the fourth quarter of 2012 to $306 million. Full-year net income was $1.159 billion, off about 3 percent from $1.195 billion in fiscal 2012. CEO Ursula Burns observed that the lackluster results were in line with the firm\u2019s previous guidance and indicated the company is well positioned for 2014. Lexmark reported the day after Xerox saying it had finished the year with a stronger than expected fourth quarter. Lexmark had revenue of $1.006 billion, up 4 percent from $967.4 million in the year-ago period. For the full year, Lexmark did not do as well with total annual revenue down 3.4 percent from $3.798 billion in 2012 to $3.668 billion in 2013. Although down, the company said that excluding the negative impact of its inkjet business, revenue for the full year would have actually increased 4 percent. Lexmark\u2019s operating margin was 15.0 percent in the fourth quarter versus a mere 6.3 percent in the fourth quarter of 2012. For all of fiscal 2013, the company had an operating margin of 11.2 percent more than double the 5.0 percent recorded in 2012. Net earnings also improved significantly in the fourth quarter skyrocketing some 257 percent from $26.3 million in the fourth quarter of 2012 to $94 million last year. Lexmark\u2019s net earnings also experienced strong gains, surging 143 percent from $107.6 million in 2012 to $261.8 million this year. Of the three U.S.-based OEMs, Hewlett-Packard\u2019s printer business was strongest last year and it appears that will be the case in 2014. The firm\u2019s fiscal year runs from November 1 until October 31 and on February 26 it reported its first quarter financial results for fiscal 2014. Revenue from HP\u2019s former Imaging and Printing Group (IPG) dropped from $5.9 billion in 2012 to $5.8 billion, which represented a decline of about 2 percent. The good news was that the group\u2019s unit shipments were up and it achieved an operating margin of 16.8 percent, up 700 basis points compared to the first quarter of 2013. Although IPG\u2019s revenue continues to hover at the levels recorded during the recession, for the past seven quarters, its operating profits have been at or above 15.5 percent. The group\u2019s earnings before taxes reached $979 million in the first quarter of this year compared to $967 last year. Better In Japan Although it missed its guidance, Canon reported on January 29 that it had grown full-year sales and profits for the first time in three years. The firm declared it is becoming \u201cincreasingly apparent\u201d that the worldwide economy will recover in 2014. Canon had net sales of \u00a51.035 trillion compared with \u00a5951.4 billion in the fourth quarter of fiscal 2012, an 8.8 percent increase. For the full year, Canon\u2019s sales totaled \u00a53.731 trillion, a 7.2 percent increase from \u00a53.480 trillion in fiscal 2012. Canon said in addition to the positive effects of favorable currency exchange rates it experienced \u201csteady sales growth for MFDs and laser printers, along with an increase in sales […]<\/p>\n","protected":false},"author":58,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1649,1814,1642],"tags":[],"_links":{"self":[{"href":"http:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts\/8723"}],"collection":[{"href":"http:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/users\/58"}],"replies":[{"embeddable":true,"href":"http:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/comments?post=8723"}],"version-history":[{"count":2,"href":"http:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts\/8723\/revisions"}],"predecessor-version":[{"id":8725,"href":"http:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts\/8723\/revisions\/8725"}],"wp:attachment":[{"href":"http:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/media?parent=8723"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/categories?post=8723"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/tags?post=8723"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}