Technology industry counts the cost of Japanese disaster May 27, 2011 16:31 by Chris Rails

As Japan starts to get back on its feet after the devastating earthquake and tsunami back in March, many companies are now calculating the total cost of the natural disaster. With large urban areas destroyed, various technology companies have found themselves without the infrastructure they need to operate, while others have found themselves without buyers in the key Japanese market.

Few of the big name printer manufacturers have been unscathed by the disaster, with many now starting to take stock on just how big an impact it will have on 2011's operating results.

Japanese firm Canon was one of the first to acknowledge the impact of the event on its manufacturing base, as it reported considerable damage to buildings and production equipment. It did, however, strive to have its operations fully restored by the end of April, following the deployment of the Canon Earthquake Disaster Recovery Task Force.

In recent weeks, chief executive of the firm Fujio Mitarai told Reuters that supply chain operations at Canon were getting back on track faster than the company had anticipated.

"As those involved in parts production have been giving it their best, we expect supplies to arrive sooner than we had predicted. We now forecast [production] to return to normal by the end of June," he commented. Despite this optimism, the company has downwardly revised its annual earnings forecast for 2011.

Other businesses did not report difficulties for some time afterwards, as Lexmark only reported in recent days that its operations had been affected. Chief financial officer John Gamble Jr announced at the company's first quarter conference that a minor impact had been sustained, with consumers informed that there would be a slight interference to laser printer availability over the coming months.

Lexmark has neither a manufacturing or logistical presence in Japan, but the effects of the earthquake have nevertheless filtered through to its financial predictions for the second quarter of 2011.

Even in light of the earthquake and tsunami, consumer electronics firm Sony still believes it will end up back in the black this year, as its predicted net profit stands at $975 million (£596.2 million). Market forecasts, however, have suggested the company could earn 105 billion yen (£791m) in the year starting April 1st, although believe the real situation will not come to the fore just yet.

Koji Takeuchi, senior economist at Mizuho Research Institute, commented: "Looking at their forecast, it appears Sony is expecting a recovery in the latter half of the year, which is a bullish forecast, but there's a lot of uncertainty and there is a risk they come in below that expectation."

The fact remains that the impact of Japan's misfortunes is likely to be felt for many months or even years to come, as the country starts to rebuild its infrastructure and slowly get back to a sense of normality. The resilience of printer manufacturers and the technology industry as a while will be put to the test, but only time will tell just how well they are able to cope.