FOR IMMEDIATE RELEASE
Kurita Water Industries Reports Earnings for the Three Months Ended June 30,
2013
Tokyo, Japan, July 30, 2013—Kurita Water Industries Ltd. (TSE Securities Code 6370)
announced net sales of 36,558 million yen and net income of 1,803 million yen, or
15.14 yen per share, for the three months ended June 30, 2013 (April 1, 2013 – June 30,2013).
Results of Operations
Total consolidated orders for the Kurita Group in the three months ended June 30, 2013,
decreased 5.4% versus the same period of the previous fiscal year, to 42,111 million yen.
Net sales declined 9.2% year on year, to 36,558 million yen. In terms of income,operating income declined 40.9% year on year to 2,568 million yen, and ordinary
income declined 37.5% to 2,870 million yen. Net income amounted to 1,803 million
yen, down 48.6%.
Reviewing the markets in which the Kurita Group (Kurita Water Industries and its
consolidated subsidiaries and equity method affiliates) operates, although profitability atmanufacturers, especially export-oriented companies, improved in Japan thanks to aweaker yen, production quantities did not rise significantly overall, and nor did capacity
utilization in the manufacturing industry increase. There appeared to be a continuingsurplus of production capacity, and capital investment remained sluggish.
Outside Japan, the global economy recovered moderately, backed by the strong U.S.
economy, but uncertainty over the European economy and emerging economies,
especially the Chinese economy, remained strong.
In this challenging environment, the Kurita Group took steps to expand overseas
operations and to strengthen its domestic operating base by selling competitive products
and services in growing regions and industries. The Group, however, struggled in thefirst three months of the fiscal year.
Segment Information
Water Treatment Chemicals
Total Group orders for the Water Treatment Chemicals segment in the three-month
period totaled 14,564 million yen, up 0.7% versus the same period of the previous fiscalyear. Sales increased 1.6%, to 13,681 million yen, while operating income declined
7.8%, to 1,855 million yen.
In Japan, there was a decrease in orders for and sales of core products, including
boiler water treatment chemicals and cooling water treatment chemicals in almost allindustries. Overseas, both orders and sales increased, with orders for and sales ofcooling water treatment chemicals, reverse osmosis membrane treatment chemicals, andprocess treatment chemicals for the pulp and paper industries rising in China andSoutheast Asia. Overall, both orders and sales rose slightly.
Water Treatment Facilities
Total Group orders for the Water Treatment Facilities segment in the three-month
period amounted to 27,546 million yen, down 8.3% versus the same period of theprevious fiscal year. Sales declined 14.7% to 22,876 million yen, and operating income
dropped 69.2% to 715 million yen.
1In Japan, orders for and sales of water treatment facilities in the electric powerindustry declined from the same period of the previous fiscal year due to the completionof demand related to reconstruction after the Great East Japan Earthquake. Orders forand sales of water treatment facilities and maintenance services decreased in theelectronics industry, with no signs of capacity utilization rates rising or capital
investment recovering. Orders and sales in the ultrapure water supply business fell with
contracts expiring and changing in the previous fiscal year.
Overseas, although the Group sought to attract demand for small and medium-sized
projects and maintenance services in East Asia and Southeast Asia, which the Grouppositions as priority markets, both orders and sales declined due to the postponement of
capital investments for large projects in the electronics industry, among other factors.
Financial Condition
Current assets totaled 145,877 million yen at the end of the first quarter (June 30, 2013),
a decrease of 997 million yen versus the end of the previous fiscal year (March 31,2013). This was mainly a result of declines of 11,253 million yen in trade accounts
receivable and 4,295 million yen in cash and deposits, which outweighed increases of
10,000 million yen in marketable securities, 2,005 million yen in work in process, and1,936 million yen in trade notes receivable.
The decline in trade accounts receivable was the result of progress in collecting
receivables and weaker sales in the first quarter under review than in the fourth quarterof the previous fiscal year. The decline in cash and deposits and increase in marketablesecurities was mainly the result of increased investment in negotiable certificates, which
are treated as marketable securities. The increase in work in process was mainly theresult of progress in construction work in the water treatment facilities business. The
rise in trade notes receivable is the result of an increase in notes in accounts receivable
collected.
Noncurrent assets totaled 115,952 million yen at the end of the three-month period(June 30, 2013), a decline of 753 million yen versus the end of the previous fiscal year.
The decline was principally attributable to a 2,442 million yen decrease in property,plant and equipment, which was partly offset by a 1,706 million yen rise in investments
and other assets. The decline in property, plant and equipment was due to depreciationof ultrapure water supply business facilities exceeding capital expenditures. The
increase in investments and other assets reflected a rise in unrealized gains on
investment securities due to rises in the market prices of the shares held by the Group.
Current liabilities totaled 31,807 million yen at the end of the period, a decline of
3,608 million yen versus the end of the previous fiscal year. This was mainly a result of
declines of 2,173 million yen in trade accounts payable and 1,344 million yen in income
taxes payable.
Noncurrent liabilities totaled 19,010 million yen at the end of the period, a slightdecrease of 36 million yen versus the end of the previous fiscal year.
Net assets totaled 211,012 million yen at the end of the period, an increase of 1,894
million yen versus the end of the previous fiscal year primarily due to a 2,575 million
yen increase in accumulated other comprehensive income, which more than offset a 698
million yen decrease in retained earnings. The decline in retained earnings resulted fromyear-end dividends of 2,502 million yen for the previous fiscal year, exceeding net
income of 1,803 million yen for the first quarter. The increase in accumulated othercomprehensive income is a result of a 1,718 million yen rise in unrealized gains onavailable-for-sale securities due to the increase in unrealized gains on investment
securities and a 857 million yen increase in foreign currency translation adjustments
associated with a weaker yen.
2Outlook for the Fiscal Year Ending March 31, 2014
The Group’s current outlook for the six months ending September 30, 2013, and the fullyear ending March 31, 2014 is consistent with the targets disclosed in “Earnings Reportfor the Full Year Ended March 31, 2013,” which was announced on April 30, 2013.
Other Information(1) Changes in significant subsidiaries during the three months ended June 30, 2013
There were no changes in specified subsidiaries that would have changed the scope ofconsolidation.
Starting the first quarter under review, the equity method is applied to a newly
established company and a company whose significance has increased.
(2) Accounting treatment specific to the preparation of quarterly consolidated financial
statements
Tax expense
The Company calculates tax expense by producing a reasonable estimate of theeffective tax rate after applying tax-effect accounting to income before income taxes
and minority interests for the fiscal year and then multiplying quarterly income before
income taxes and minority interests by this estimated effective tax rate.

3Financial Statements — Consolidated
Balance Sheet — Consolidated(Million yen)

AssetsCurrent assets
Cash and deposits
Notes receivable - trade
Accounts receivable - tradeMarketable securities
Finished products
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings (net)
Machinery and equipment (net)Other (net)Total property, plant and equipment
Intangible fixed assets
Investments and other assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets
Liabilities
Current liabilities
Notes payable – trade
Accounts payable - trade
Income taxes payableAllowances
Other
Total current liabilities
Noncurrent liabilities
Accrued employees’ retirement benefits
Other allowances
Other
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders’ equity
Common stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Unrealized gains on available-for-sale securities
Unrealized gains (losses) on revaluation of landForeign currency translation adjustments
Total accumulated other comprehensive income
Minority interests
Total net assets
Total liabilities and net assets

As ofMarch 31, 2013
Amount

As ofJune 30, 2013
Amount43,0396,10855,27934,000
1,445
2,238
1,191
3,676
(104)
146,874

38,7448,044
44,02644,000
1,557
4,243
1,517
3,832
(87)
145,877

23,69336,173
26,95486,8201,619

22,896
37,10924,372
84,3781,603

28,506(241)
28,265
116,705
263,580

30,343(372)
29,971
115,952
261,830

1,451
16,5222,509
3,550
11,38235,415

1,425
14,3491,165
2,562
12,30431,807

10,835165
8,045
19,04654,462

10,99691
7,922
19,01050,817

13,45011,426
202,807(21,859)
205,826

13,45011,426202,109(21,859)
205,127

4,079
(564)
(1,469)2,045
1,246
209,118
263,580

5,797
(564)
(612)
4,620
1,264
211,012
261,830

4

Statements of Income and Comprehensive Income — Consolidated
Statement of Income(Million yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Equity in earnings of unconsolidated subsidiaries andaffiliates
Other
Total non-operating income
Non-operating expenses
Interest expense
Valuation loss on investment securities
Other
Total non-operating expenses
Ordinary income
Extraordinary gains
Gain on sales of noncurrent assets
Gain on discontinuation of approved retirement annuity
system (closed-type)
Total extraordinary gains
Income before income taxes and minority interests
Income taxes
Income before minority interests
Minority interests in earnings of consolidated subsidiaries
Net income

Three months ended
June 30, 2012
Amount40,273
26,578
13,695
9,349
4,345

Three months ended
June 30, 2013
Amount36,55824,021
12,536
9,968
2,568

43
182

47
164

75

23

40
342

95
332

22
53
19
95
4,592

14–
15
30
2,870

1,040

–

137

–

1,177
5,770
2,200
3,570
59
3,510

–
2,870
1,094
1,775
(27)
1,803

5

Statement of Comprehensive Income(Million yen)

Income before minority interests
Other comprehensive income
Unrealized gains on available-for-sale securities
Foreign currency translation adjustments
Share of other comprehensive income of associates
accounted for using equity method
Total other comprehensive income
Comprehensive income
Components:
Comprehensive income attributable to owners of theparent company
Comprehensive income attributable to minority interests

Three months ended
June 30, 2012
Amount3,570

Three months ended
June 30, 2013
Amount
1,775(816)
632

1,712
873

4240(142)
3,428

2,627
4,403

3,322

4,379

105

246

Notes to Consolidated Financial Statements(Notes on the Going-concern Assumption)
Three months ended June 30, 2013 (April 1, 2013 – June 30, 2013)
Not applicable(Notes on Significant Changes in Shareholders’ Equity)
Three months ended June 30, 2013 (April 1, 2013 – June 30, 2013)
Not applicable(Segment Information)
1. Sales and income by reportable segment
Three months ended June 30, 2012 (April 1, 2012 – June 30, 2012)(Million yen)

Reportable Segments

Amounts
reported on
Adjustments the quarterly
statements of(note 1)
income(note 2)Water
Treatment
Chemicals

Water
Treatment
Facilities

Total

Sales
Sales to outside customers
Inter-segment sales or transfers

13,46555

26,80751

40,273107–(107)

40,273–

Total

13,52126,859

40,381(107)

40,273

Segment income

2,013

2,318

4,332

13

4,345

Three months ended June 30, 2013 (April 1, 2013 – June 30, 2013)(Million yen)

Reportable Segment

Sales
Sales to outside customers
Inter-segment sales or transfers
Total
Segment income

Water
Treatment
Chemicals

Water
Treatment
Facilities

Total

13,68144
13,726
1,855

22,87647
22,923715

36,55892
36,6502,571

Amounts
reported on
Adjustments the quarterly
statements of(note 1)
income(note 2)
–(92)
(92)
(2)

36,558–36,558
2,568

Notes:
1. Adjustments related to sales represent elimination of inter-segment sales. Resultant adjustment of segment
income is reflected in segment income Adjustments.
2. Segment income is shown at the operating income level.

7Supplementary Information — Consolidated(1) Order Intake(Million yen)

Business segment
Water Treatment Chemicals

Three months ended June 30,
2012
2013
%
AmountAmount14,462
32.5
14,564%
34.6

Water Treatment Facilities

30,053

67.5

27,546

65.4

Total

44,516100.0

42,111

100.0(2) Net Sales(Million yen)

Business segment
Water Treatment Chemicals

Three months ended June 30,
20122013
Amount%Amount13,46533.4
13,681%
37.4

Water Treatment Facilities

26,807

66.6

22,876

62.6

Total

40,273100.0

36,558100.0(3) Capital Expenditures (Property, Plant and Equipment)(Million yen)

Business segment
Water Treatment Chemicals
Water Treatment Facilities
Total

Three months ended June 30,2012
2013
Amount%Amount
199
18.8
211

%
23.5

862

81.2

689

76.5

1,061

100.0

901

100.0

(4) Depreciation (Property, Plant and Equipment)(Million yen)

Business segment
Water Treatment Chemicals

Three months ended June 30,2012
2013
Amount%Amount2546.9265%
7.6

Water Treatment Facilities

3,438

93.1

3,253

92.4

Total

3,693

100.0

3,519

100.08