Fuji Xerox may miss target as demand eases

Bloomberg

Fuji Xerox Co. may miss its sales target for the next fiscal year because of slowing demand.

“Even if we manage to achieve our earnings plan this fiscal year, it will still be quite hard for us to boost sales enough to reach the target,” President Tadahito Yamamoto said Monday. He was referring to the closely held company’s revenue estimate of ¥1.1 trillion for the year starting April 1.

Business is slowing in China, where the company suspended a new television commercial featuring Hong Kong film actor Tony Leung, Yamamoto said. The easing sales in China add to uncertainty about the company’s business outlook after corporate clients in mature markets began investing at a slower pace, he said.

Fuji Xerox, the biggest unit of Fujifilm Holdings Corp. and Japan’s biggest maker of color printers, has yet to decide whether its medium-term management goals need to be reconsidered, Yamamoto said.

“There are still measures such as making an acquisition” that can help the company meet the goals, he said. Fuji Xerox, which doesn’t have a specific target in mind, would consider a deal “if there is an opportunity,” he said.

The copier maker, 25 percent owned by Xerox Corp., aims for an operating margin of 10 percent or more and revenue of ¥1.1 trillion in the year ending in March 2014, it said in October 2011.

Fuji Xerox completed an acquisition of a business process outsourcing division from North Sydney-based Salmat Ltd. for 375 million Australian dollars ($395 million) in October.

Sales fell 3.3 percent to ¥247.2 billion in the three months that ended Sept. 30, Fuji Xerox said Oct. 31. Operating profit, or sales minus the cost of goods sold and administrative expenses, dropped 33 percent to ¥17.1 billion during the period, the firm said.

Even after second-quarter revenue and profit declined, the office equipment maker aims to boost both revenue and profit for the year ending March 31, the president said.