Brexit, Turkish debt and currency crisis and Sino-American trade friction created concerns about China, decline in A3 MFP’s all impact on Ricoh.
The OEM has released its full year report, ended the 31st March where sales declined 2.4 percent, to ¥2,013.2 billion ($18.349 billion /€16.399 billion). Despite the global economy’s continued recovery, growth remained moderate in Japan and the United States. Other factors impacting on sales were cited including Brexit, the currency and debt crisis in Turkey and the impact of Sino-American trade friction created concerns about China.
Sales in the overseas market decreased by 4.4 percent as compared to the previous period. Growth was generally steady in Europe. Sales in other regions, which includes China, South East Asia and Oceania, were off owing to a decline in office printing. As a result, excluding effects of foreign currency fluctuations, sales in overseas would have decreased by 3.9 percent as compared to the previous corresponding period.
For a second year running demand for Ricoh’s mainstay office equipment was down in developed nations but expanded in emerging markets. Demand continues to decline for A3 multifunctional printers (MFPs), while demand for A4 models rose in developed and emerging nations. Consumables sales were down in developed countries but up in emerging markets following on the expanding hardware demand.
Gross profit was down 3.0 percent, to ¥766.8 billion ($6.989 billion/ €6.246 billion). This was despite an improvement in office services. Ricoh cite a prime factor was a decrease in office printing because of the impact of sales reforms implemented in the previous year, lower sales from emphasizing more profitable business deal sales, and a sales drop ahead of new MFP model launches. The changes to equity-method accounting for some consolidated subsidiaries and the removal from consolidation of Ricoh India detracted from earnings. There were also downturns in the Industrial Printing and Thermal amid a deteriorating market climate in China.
Profit, as apposed to turnover were the focus as Ricoh prioritised profits over sales in negotiating deals, lowering hardware and consumables revenues, particularly overseas.
In January 2019, Ricoh launched the RICOH IM C series of advanced MFPs that are constantly up to date based on a smartphone concept of remotely updating firmware and software after installation. Other features include large touch panels on their machines to choose and install corporate workflow support services. This setup enables small and medium-sized enterprises to use employ more information technology in their businesses by making it simple for them to use cloud services.
You can download the full financial report here
