April 25, 2018 / 6:35 AM / a year ago

UPDATE 1-Japan's Canon Q1 profit rises 5.3 pct on chip-making equipment demand

* Chip lithography equipment sales more than double

* Maintains full-year outlook at 404 bln yen

* Analysts cautious about OLED panel-making equipment sales (Adds CFO comment, background)

TOKYO, April 25 (Reuters) - Canon Inc reported a 5.3 percent rise in first-quarter operating profit on Wednesday, as sustained demand for semiconductors boosted sales of the Japanese firm’s chip-making equipment.

“Brisk demand for memory chips is driving our clients to boost investment,” Chief Financial Officer Toshizo Tanaka told reporters. “That led to a 2.5-fold jump in sales of our semiconductor lithography equipment.”

The firm, which also makes of cameras and printers, posted operating profit of 77.1 billion yen ($707.14 million) for the three months through March, from a year-before profit of 73.2 billion yen.

The result missed the 85.03 billion yen average of 3 analyst estimates in a Thomson Reuters poll.

Canon maintained its annual profit forecast for the year ending December at 404 billion yen, versus a consensus estimate of 406.36 billion yen from 18 analysts.

Cost cuts have been helping Canon’s traditional copier and printer business rebound, while growth in new fields such as surveillance cameras is has also boosted profit.

Meanwhile, the company is also benefiting from strong demand for organic light-emitting diode (OLED) panel-making equipment produced at its Canon Tokki unit.

But analysts are increasingly concerned that spending on the equipment at Samsung Electronics Co Ltd, the world’s largest maker of small OLED panels, could slow due to sluggish sales of OLED smartphones including Apple Inc’s high-end iPhone X.

Nomura Securities last week lowered its annual operating profit forecast for Canon, saying that capital spending on smartphone OLEDs panels in 2018 will be “down sharply versus 2017.” ($1 = 109.0300 yen) (Reporting by Makiko Yamazaki Editing by Christopher Cushing)

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