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52 CANON ANNUAL REPORT 2009
Canon’s long-term debt (excluding current portion) generally
consists of lease obligations.
In order to facilitate access to global capital markets, Canon
obtains credit ratings from two rating agencies: Moody’s
Investors Services, Inc. (“Moody’s”) and Standard and Poor’s
Rating Services (“S&P”). In addition, Canon maintains a rating
from Rating and Investment Information, Inc. (“R&I”), a rating
agency in Japan, for access to the Japanese capital market.
As of March 23, 2010, Canon’s debt ratings are: Moody’s:
Aa1 (long-term); S&P: AA (long-term), A-1+ (short-term); and
R&I: AA+ (long-term). Canon does not have any rating down-
grade triggers that would accelerate the maturity of a material
amount of its debt. A downgrade in Canon’s credit ratings or
outlook could, however, increase the cost of its borrowings.
Increase in property, plant and equipment on an accrual
basis in fi scal 2009 amounted to ¥216,128 million (U.S.$2,349
million) compared with ¥361,988 million in fi scal 2008 and
¥428,549 million in fi scal 2007. In fi scal 2009, increase in prop-
erty, plant and equipment was mainly used to introducing new
products. For fi scal 2010, Canon projects its increase in property,
plant and equipment will be approximately ¥220,000 million (U.
S.$2,391 million).
Employer contributions to Canon’s worldwide defi ned bene-
fi t pension plans were ¥18,232 million (U.S.$198,174 million) in
fi scal 2009, ¥23,033 million in fi scal 2008, ¥21,720 million in
fi scal 2007. In addition, employer contributions to Canon’s
worldwide defi ned contribution pension plans were ¥9,148 mil-
lion (U.S.$99 million) in fi scal 2009, ¥10,840 million in fi scal
2008, and ¥10,262 million in fi scal 2007.
Working capital in fi scal 2009 increased by ¥113,241 million
(U.S.$1,231 million), to ¥1,234,089 million (U.S.$13,414 mil-
lion), compared with ¥1,120,848 million in fi scal 2008 and
¥1,352,082 million in fi scal 2007. This increase was primarily a
result of the increase in cash and cash equivalent. Canon
believes its working capital will be suffi cient for its requirements
for the foreseeable future. Canon’s capital requirements are pri-
marily dependent on management’s business plans regarding
the levels and timing of purchases of fi xed assets and invest-
ments. The working capital ratio (ratio of current assets to cur-
rent liabilities) for fi scal 2009 was 2.57 compared to 2.19 for
fi scal 2008 and to 2.08 for fi scal 2007.
Return on assets (net income attributable to Canon Inc. divid-
ed by the average of total assets) was 3.4% in fi scal 2009, com-
pared to 7.3% in fi scal 2008 and 10.8% in fi scal 2007.
Return on Canon Inc. stockholders’ equity (net income
attributable to Canon Inc. divided by the average of total Canon
Inc. stockholders’ equity) was 4.9% in fi scal 2009 compared
with 11.1% in fi scal 2008 and 16.5% in fi scal 2007.
Debt to total assets ratio was 0.3%, 0.4% and 0.6% as of
December 31, 2009, 2008 and 2007, respectively. Canon had
short-term loans and long-term debt of ¥9,781 million
(U.S.$106 million) as of December 31, 2009, ¥13,963 million
as of December 31, 2008 and ¥26,997 million as of December
31, 2007.
500,000
400,000
300,000
200,000
100,000
0
05 06 07 08 09
Increase in Property,
Plant and Equipment
(Millions of yen)
361,988
216,128
383,784 379,657
428,549
3.0 20
15
10
5
0
2.5
2.0
1.5
1.0
0.5
0.0
05 06 07 08 09
Working Capital Ratio
05 06 07 08 09
Return on Canon Inc.
Stockholders’ Eqiuty
(%)
2.28
2.39
2.08 2.19
2.57
16.0 16.3 16.5
11.1
4.9
Canon AR09_FS_0325_ipc .indd 52 10.3.26 2:47:02 PM