TOKYO, April 24 (Reuters) - Japan's Canon Inc. (7751.T: Quote, NEWS , Research)posted a 22 percent rise in quarterly operating profit to arecord due to strong demand for copiers, laser printers anddigital cameras, and lifted its full-year forecast by 3 percenton a weaker yen.

Canon is headed for its eighth straight year of profit growthas it expands sales of high-end digital cameras, colour officecopiers and laser printer engines supplied to Hewlett-Packard Co.(HPQ.N: Quote, Profile , Research), while a soft yen helps boost profits overseas.

Canon was the first to report earnings among Japan's cameraand office equipment makers, which on average are expected topost strong growth for the past business year but issueconservative outlooks given worries over the U.S. economy andsigns that demand for digital cameras might be cooling.

Tokyo-based Canon predicted a tough going in the video cameramarket amid fierce competition with rivals such as Sony Corp.(6758.T: Quote, NEWS , Research), but expressed confidence that it would be able tocompensate by selling more digital cameras.

"We expect sluggish growth in camcorders, reflecting theharsh market environment," Canon Vice President Toshizo Tanakasaid at a news conference. "But overall the camera division willpost 9.7 percent sales growth, driven by digital camera demand."

Canon raised its operating profit forecast for the year toDecember to 790 billion yen from 765 billion yen as the softeryen more than offset larger-than expected research anddevelopment outlays and sales promotion costs. Continued...

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