Sumitomo Heavy Industries, Ltd.
THIRD QUARTER CONSOLIDATED FINANCIAL REPORTFor the Nine-Month Period from April 1 to December 31, 2014

All financial information has been prepared in accordance with generally accepted accounting principles in Japan. This document
has been translated from the Japanese original as a guide to non-Japanese investors and contains forward-looking statements thatare based on management’s estimates, assumptions, and projections at the time of publication. A number of factors could cause
actual results to differ materially from expectations. Amounts shown in this financial statement have been rounded to the nearest
million yen.

Consolidated Results for the Third Quarter
Ended December 31, 2014

Summary of Consolidated Financial Results
For the Third Quarter Ended December 31, 2014
Presented January 30, 2015

Sumitomo Heavy Industries, Ltd.
Listed exchanges

Tokyo Stock Exchange

Stock code

6302

Head officeTokyo

President

Shunsuke Betsukawa

URLwww.shi.co.jp

Inquiries

Tsuneyoshi Sato
General Manager, Corporate Communications Dept.

Telephone+81 3 6737 2331

Scheduled reporting date for quarterly reportFebruary 5, 2015

Scheduled date of payment of cash dividends-

Availability of supplementary explanations forquarterly financial statement
Holding of meeting to explain quarterly financial
statement

None
None

1. FY 2014 Third Quarter Consolidated Results (April 1, 2014, to December 31, 2014)(1) Business Results(Units: millions of yen)
Third Quarter
April 1 to December 31, 2014

Previous Third Quarter
April 1 to December 31, 2013

% change% change

Net sales

466,78810.1

424,007

1.4

Operating income

34,032

82.6

18,635(15.4)

Ordinary income

34,494

83.1

18,834(10.8)Net income

21,823

95.3

11,175

7.9

Net income per share (yen)Fully diluted net income per share (yen)

35.59

18.22

－

－

Note: Comprehensive income
Fiscal quarter ended December 31, 2014: 24,258 million yen (-8.0%)
Fiscal quarter ended December 31, 2013: 26,365 million yen (178.7%)2

Consolidated Results for the Third Quarter
Ended December 31, 2014

(2) Financial Position(Units: millions of yen)
End of Third Quarter
As of December 31, 2014

End of Previous Full YearAs of March 31, 2014

Total assets

752,868

724,182

Shareholders’ equity

349,455

331,059

45.7

45.1

Equity ratio (%)
Reference: Equity
Fiscal quarter ended December 31, 2014: 344,390 million yen
Fiscal year ended March 31, 2014: 326,433 million yen

2. Dividends(Units: yen)
Year Ended March 31,
2014Year Ended March 31,
2015

Year Ended March 31,
2015 (forecast)

Annual dividends per share
－

－

3.00

5.00

Third quarter－－End of term

4.00

5.00

Annual dividends

7.00

10.00

First quarter
Second quarter

Note:

Changes from the most recent dividend forecast: None

3. FY 2014 Consolidated Forecasts (April 1, 2014, to March 31, 2015)(Units: millions of yen)
Full Year
April 1, 2014, to March 31, 2015

% change
Net sales

650,000

5.6

Operating income

42,00022.3

Ordinary income

38,50016.7

Net income

21,000

17.4

Projected net income per share (yen)

34.25

Note:

Changes from the most recent consolidated forecast: None3

Consolidated Results for the Third Quarter
Ended December 31, 2014

Additional Notes(1) Transfers of important subsidiaries during the fiscal period (moves of specific subsidiaries due to change in scope of
consolidation):
None
Newly consolidated:

None

Excluded from consolidation:None(2) Special accounting measures applied in the quarterly consolidated financial report:

None(3) Changes to accounting policies, changes to accounting estimates, and restatements(i) Changes to accounting policies resulting from revisions to accounting standards, etc.:

Yes(ii) Changes other than (i):Yes(iii) Changes to accounting estimates:Yes(iv) Restatements:

None(4) Number of shares issued (common shares)(i) Number of shares issued at end of fiscal period (including treasury stock):
As of December 31, 2014
As of March 31, 2014

614,527,405 shares
614,527,405 shares(ii) Amount of treasury stock at end of fiscal period
As of December 31, 2014
As of March 31, 2014

1,470,557 shares
1,248,184 shares(iii) Average number of shares during fiscal period (cumulative quarterly period)
As of December 31, 2014
As of December 31, 2013

613,149,124 shares
613,452,697 shares

Recording of Implementation Conditions regarding Quarterly Review ProceduresThis quarterly financial summary does not fall within the scope of the Quarterly Review Procedures referenced in
the Financial Instruments and Exchange Act. At the time of disclosure of the quarterly financial summary, theGroup was in the process of implementing the quarterly review procedures for its quarterly financial statements.
Explanations and Other Special Items regarding the Pertinent Reasons for the Earnings Forecast
Earnings forecasts and outlooks concerning future financial results are believed to be reasonable based on
information available at the time of publication. Actual financial results may vary from the above forecast andoutlook because of a variety of factors. For information on the assumptions that form the basis of the earnings
forecast and items to note concerning the use of earnings forecasts, please see the Explanation of theConsolidated Earnings Forecast and Other Forward-Looking Estimates in the Supplementary Materials on page8.

4

Consolidated Results for the Third Quarter
Ended December 31, 2014

Supplementary Materials – Table of Contents
1. Qualitative Information regarding Current Quarterly Consolidated Business Performance ....... 6(1) Explanation of Business Performance ........................................................................................... 6(2) Explanation of the Group’s Consolidated Financial Position .......................................................... 7(3) Explanation of the Consolidated Earnings Forecast and Other Forward-Looking Estimates ......... 8
2. Notes regarding Summarized Information (Explanatory Notes) .................................................... 9(1) Changes Involving Important Subsidiaries during the Current Consolidated Year-to-Date Quarterly
Period ............................................................................................................................................. 9(2) Special Accounting Procedures Adopted during the Development of the Quarterly Consolidated
Financial Report.............................................................................................................................. 9(3) Changes to Accounting Policies, Changes to Accounting Estimates, and Restatements ............... 9
3. Quarterly Consolidated Financial Statements ............................................................................... 10(1) Quarterly Consolidated Balance Sheets ...................................................................................... 10(2) Consolidated Income Statements and Consolidated Statement of Comprehensive Income ........ 12
Consolidated Income Statements ................................................................................................ 12
Consolidated Statement of Comprehensive Income .................................................................... 13(3) Notes regarding Consolidated Quarterly Financial Statements .................................................... 13(Notes on Premise of a Going Concern) ...................................................................................... 13(Notes regarding Significant Fluctuations to Shareholders’ Equity).............................................. 13(Subsequent Events of Significant Importance) ........................................................................... 13
4. Supplementary Information ............................................................................................................. 14(1) Orders, Sales and Operational Profit, and Balance of Orders by Segment .................................. 14(2) (Summary) Consolidated Cash Flows Statement ......................................................................... 175

Consolidated Results for the Third Quarter
Ended December 31, 2014

1. Qualitative Information regarding Current Quarterly Consolidated Business
Performance(1) Explanation of Business Performance
The Japanese economy in the third quarter of the current consolidated fiscal year under review saw a delayed recovery
from the slowdown in demand after the spike caused by the increase in sales tax (i.e. a rush to put in order prior to theincrease in sales tax). On the other hand, capital investment levels remained relatively strong due to the weaker Japaneseyen. Outside Japan, there were clear signs of economic recovery in the United States. On the other hand, the Eurozone
started showing signs of a slowdown while the Chinese economy remained stagnant, and a heightened level ofgeopolitical risk engulfed the Middle East and Russia. As a result, the overall outlook of the global economy continued toremain unclear.
Set against this economic backdrop, the Group continued to implement the Medium-Term Management Plan 2016 during
the third quarter of the current consolidated fiscal year, and executed business operations with a focus on achieving
steady growth and increased competitiveness. As a result, orders increased across all segments of the Group, with the
exception of the Other segment. In specific figures, the Group posted order figures of JPY551.3 billion, a 17% gain ascompared to the same period last year (hereinafter referred to as the “previous term”). In terms of sales, the Group posted
better than the previous term figures across all segments with the exception of the Other segment. In specific figures,
sales totaled JPY466.8 billion, a 10% gain as compared to the previous term.
Turning to income, operating income was JPY34.0 billion, a 83% increase as compared to the previous term, and ordinary
income was JPY34.5 billion, a 83% increase as compared to the previous term. Quarterly net income also increased by
95% as compared to the previous term to finish at JPY21.8 billion. The improvements in profitability were mainly as aresult of an increase in sales as well as improvements made to profit margins.
Conditions in each business segment of the Group were as follows:
1. Machinery Components
Conditions in the domestic market continued to remain strong. Outside Japan, although conditions in the Eurozone andChina remained weak, other markets, including North America, showed positive signs of growth, and as a result there wasa rise in both orders and sales as compared to the previous term. In actual figures, the segment received orders worth
JPY78.4 billion, a 9% gain as compared to the previous term, and posted sales of JPY74.2 billion, a 2% gain as comparedto the previous term. Further, the segment posted operating income of JPY5.8 billion.
2. Precision Machinery
With respect to plastics machinery, there was an increase in IT-related demand from Asian markets, as well as a brisk
market conditions seen in Japan and the Eurozone. As a result, both orders and sales figures for this product line showed
improvements as compared to the previous term. In other product lines, the recovery in demand for the segment’s
semiconductor-related products contributed to an increase in orders and sales for the entire segment. In actual figures,the segment received orders worth JPY110.6 billion, a gain of 12% as compared to the previous term, and posted sales of
JPY107.1 billion, a gain of 13% as compared to the previous term. Further, the segment posted operating income of
JPY10.4 billion.
3. Construction Machinery
The hydraulic excavator business saw a decrease in the Chinese market. Domestically, there was a slowdown mainly due
to the rush to place orders at the end of FY 2013 (prior to the rise in sales tax) but the decline of the demand trend wasactually gentle, Thankfully, a round of inventory adjustments resulted in improved performance in the North American andthe Eurozone markets, resulting in an increase in orders and sales for the entire product line as compared to the previous
term. The mobile crane business posted figures below the previous term in sales, but improved as compared to theprevious term in orders as the North American market started to recover from the slowdown at the beginning of the fiscal
year caused by the cold spell that gripped the region. As a result, the segment as a whole received orders worth JPY149.0
billion, a gain of 5% as compared to the previous term, and posted sales of JPY144.5 billion, a gain of 3% as compared tothe previous term. Further, the segment posted operating income of JPY10.7 billion.

6

Consolidated Results for the Third Quarter
Ended December 31, 2014

4. Industrial Machinery
The material handling business posted strong results as demand from the domestic shipbuilding sector showed signs ofrecovery. At the same time, the turbine business also posted strong results. As a result, orders for the entire segment
increased as compared to the previous term. Sales, however, improved as compared to the previous term, boosted byincreases seen in the turbine and pump business. In actual figures, the segment received orders worth JPY64.0 billion, again of 17% as compared to the previous term, and posted sales of JPY51.5 billion, a gain of 3% from the previous term.
Further, the segment posted operating income of JPY3.4 billion.
5. Ships
The segment received orders for nine new vessels during the current period under review, an improvement of five vessels
as compared to the previous term. With regard to sales, two vessels were handed over during the current period underreview, as compared to one in the previous term. In actual figures, the segment received orders worth JPY59.8 billion, again of 148% as compared to the previous term, and posted sales of JPY18.7 billion, a gain of 80% as compared to theprevious term. Further, the segment posted an operating loss of JPY800 million.
6. Environmental Facilities & Plants
Orders for the energy plant business were better than the previous term as the number of biomass-fueled electricity
generation boiler projects in Japan continued to rise. In addition, orders for chemical plant equipment also rose ascompared to the previous term, contributing to an overall rise in orders for the entire segment. Sales also increased ascompared to the previous term as progress was made in the construction of electricity generation boiler projects. In actual
figures, the segment received orders worth JPY81.6 billion, a gain of 14% as compared to the previous term, and posted
sales of JPY64.8 billion, a gain of 33% as compared to the previous term. Further, the segment posted operating incomeof JPY3.1 billion.
7. OtherIn this segment, both orders and sales figures fell as compared to the previous term. In actual figures, the segment
received orders worth JPY8.0 billion, a fall of 10% as compared to the previous term, and posted sales of JPY5.9 billion, afall of 13% as compared to the previous term. Further, the segment posted operating income of JPY1.6 billion.

(2) Explanation of the Group’s Consolidated Financial Position
1. Condition of Assets, Liabilities, and Net Assets
Total assets at the end of the current third quarter under review (ended December 31, 2014) amounted to JPY752.9 billion,
an increase of JPY28.7 billion as compared to the end of the previous consolidated fiscal year. This was mainly due to the
JPY22.0 billion and JPY27.9 billion increases in marketable securities and inventory assets, respectively, offsetting the
JPY15.8 billion decrease in cash and cash equivalents as compared to the end of the previous consolidated fiscal year
and the JPY13.0 billion decrease in trade notes and accounts receivable.
Total liabilities rose to JPY403.4 billion, an increase of JPY10.3 billion as compared to the end of the previous
consolidated fiscal year. This was mainly due to the increases of JPY9.7 billion and JPY18.0 billion of trade notes andaccounts payable and other in current liabilities, respectively exceeding the JPY18.9 billion decrease in the balance ofinterest-bearing liabilities.
Net assets rose to JPY349.5 billion, an increase of JPY18.4 billion as compared to the end of the previous consolidated
fiscal year. This was mainly due to the JPY3.5 billion rise in the foreign currency translation adjustment and the JPY16.2
billion increase in retained earnings.
As a result of the above, the shareholders’ equity ratio improved by 0.6% from the end of the previous consolidated fiscal
year to finish at 45.7%
2. Cash Flow Condition
Cash flow from operating activities totaled JPY40.7 billion, as compared to JPY28.2 billion in the previous term. Whenbroken down, the main components of the proceeds were JPY34.2 billion in quarterly net income before tax and otheradjustments, and the JPY31.4 billion reduction in trade receivables. The main sources of the outflow of cash were the
JPY27.8 billion increase in inventory assets and the JPY14.4 billion payment of corporate tax.

7

Consolidated Results for the Third Quarter
Ended December 31, 2014

Cash flow used for investing activities totaled JPY8.9 billion, as compared to an outflow of JPY22.6 billion during theprevious term. The outflow was mainly as a result of the JPY10.8 billion used to acquire fixed assets.
Cash flow used for financing activities totaled JPY26.9 billion, as compared to an outflow of JPY2.6 billion in the previous
term. The outflow of cash was mainly used to reduce outstanding debts (JPY20.1 billion) and to make dividend payments(JPY5.3 billion).
As a result of the foregoing, the balance of cash and cash equivalents at the end of the third quarter of the current
consolidated fiscal year under review totaled JPY81.9 billion, an increase of JPY5.5 billion as compared to the end of theprevious consolidated fiscal year.

(3) Explanation of the Consolidated Earnings Forecast and Other Forward-Looking Estimates
No revisions have been made to the consolidated earnings forecast for the period ending March 2015 that was released
to the public in conjunction with the second quarter financial report on October 30, 2014.
Please note that for the fourth quarter of the current consolidated fiscal year, the main exchange rates are assumed to be
USD1 = JPY115 and EUR1 = JPY135.

8

Consolidated Results for the Third Quarter
Ended December 31, 2014

2. Notes regarding Summarized Information (Explanatory Notes)(1) Changes Involving Important Subsidiaries during the Current Consolidated Year-to-Date Quarterly
PeriodThere are no applicable items.

(2) Special Accounting Procedures Adopted during the Development of the Quarterly Consolidated
Financial Report
There are no applicable items.

(3) Changes to Accounting Policies, Changes to Accounting Estimates, and Restatements(Changes to Accounting Policies)
From the first quarter of the current consolidated fiscal year under review, the “Accounting Standard for Retirement
Benefits” (Accounting Standards Board of Japan (ASBJ) Accounting Standard – ASBJ Statement No. 26 dated May 17,
2012; hereinafter referred to as the “Accounting Standards for Retirement Benefits”) and the “Implementation Guidanceon the Accounting Standard for Retirement Benefits” (ASBJ Guidance No. 25 dated May 17, 2012; hereinafter referred toas the “Implementation Guidance for the Retirement Benefit Accounting Standard”) has been adopted in accordance with
Item 35 of the Accounting Standards for Retirement Benefits and Item 67 of the Implementation Guidance for the
Retirement Benefit Accounting Standard. As a result of this, the methods used to calculate retirement benefit obligations
and service costs have changed. More specifically, the attribution method for projected retirement benefits has beenchanged from a service-period basis to a projected-benefit basis. Further, the method to determine the discount rate has
been changed to a single weighted-average discount rate to reflect the projected payment period for retirement benefits
and the individual amounts associated with each projected payment period.
The transitional adoption of the Accounting Standards for Retirement Benefits has been done in accordance with Item 37of the Accounting Standards for Retirement Benefits. In line with this move, the amount generated by using the new
method to calculate retirement benefit obligations and service costs has been subtracted from retained earnings from the
beginning of the third quarter of the current consolidated fiscal year under review.
As a result, retirement benefit obligations increased by JPY1,861 million from the beginning of the third quarter of thecurrent consolidated fiscal year under review while retained earnings fell by JPY1,475 million. Please note that the impact
on operating income, ordinary income, and quarterly net income before taxes and other adjustments for the third quarterof the current consolidated fiscal year under review is considered to be minimal.
(Changes to Accounting Policies That are Difficult to Distinguish from Changes in Accounting-Based Estimates)
In the past, the Company’s domestic subsidiaries have been using the declining balance method to depreciate tangible
fixed assets. From the first quarter of the current consolidated fiscal year under review, the straight-line method has beenused. Please note that the Company has already been using the straight-line method to depreciate any buildings acquired
after April 1, 1998 (excluding building fixtures).
This change was made based on a review of the depreciation method after taking into account the strategies set forth in
the new Medium-Term Management Plan, which was initiated from the beginning of the current consolidated fiscal year
under review. According to the plan, the Company will look to increase the distribution of resources to overseas locations
in response to anticipated growth from overseas markets, and shift investment domestically to ensure that stableproduction output can be achieved. As a result of the review, and the Company’s projection that its domestic production
facilities will operate in a stable manner for the foreseeable future, it was determined that the straight-line method ofdepreciating assets more appropriately reflected the operating conditions of such assets. In addition, this new
depreciation method would also allow for the rational distribution of expenses.
As a result of this change, operating income, ordinary income, and quarterly net income before taxes and otheradjustments for the third quarter of the current consolidated fiscal year under review have gone up by JPY1,820 million,
respectively, as compared to the previous calculation methodology.

9Consolidated Results for the Third Quarter
Ended December 31, 2014

3. Quarterly Consolidated Financial Statements(1) Quarterly Consolidated Balance Sheets(Units: millions of yen)
End of Previous Fiscal YearAs of March 31, 2014

End of Third Quarter
As of December 31, 2014

AmountAmountAssetsCash and deposits

67,82651,997

Notes and accounts receivable

181,961

168,968

Marketable securities

10,00032,000Inventory assets

144,249

172,121

Other

32,13542,024

Allowance for doubtful accounts(1,217)(1,225)434,954465,883Land

109,265

109,086

Other (net)

111,019

112,922

Total tangible assets

220,284

222,008

8,648

8,878

8,648

8,878

Other

61,78258,020Allowance for doubtful accounts(1,486)(1,922)60,29656,099Fixed assets

289,228

286,984

Total assets

724,182

752,868

Current assets

Other
Total intangible assets

Investments and other assets

10Consolidated Results for the Third Quarter
Ended December 31, 2014

(Units: millions of yen)
End of Previous Fiscal YearAs of March 31, 2014

End of Third Quarter
As of December 31, 2014

AmountAmountLiabilities
Notes and accounts payable

124,211

133,926

Short-term bank loans

52,81740,440Long-term loans due within one year

16,855

21,455

Corporate bonds redeemable within one year

10,0000

Allowance

10,406

10,264

Other

74,841

92,835289,130

298,9200

10,00027,761

16,618497

938

Defined benefit liability

40,03740,482

Deferred income taxes on revaluation

24,60824,568Other

11,09011,886

Total fixed liabilities

103,993

104,492

Total liabilities

393,123

403,412

Common stock

30,87230,872

Capital surplus

23,78923,789Retained earnings

221,101

237,289

(632)

(745)

275,130

291,205

Unrealized gains on securities

3,753

4,707

Profit (loss) on deferred hedge(379)(2,642)

Revaluation reserve for land

38,272

38,201

Foreign currency translation adjustments

11,993

15,482Re-measurement of defined benefit plans(2,336)(2,562)

Total accumulated other comprehensive income

51,30453,185

Minority interests

4,626

5,066

Total net assets

331,059

349,455

Total liabilities and net assets

724,182

752,868

Current liabilities
Bonds
Long-term debt due after one year
Allowance

Net assets

Treasury stock
Total shareholders' equity

11Consolidated Results for the Third Quarter
Ended December 31, 2014

(2) Consolidated Income Statements and Consolidated Statement of Comprehensive Income
Consolidated Income Statements(Units: millions of yen)Previous Third Quarter
April 1, 2013, to December 31,
2013

Present Third Quarter
April 1, 2014, to December 31,
2014

AmountAmountNet sales

424,007466,788

Cost of sales

332,612357,573

Gross income

91,395109,215

Selling, general & administrative expenses

72,76175,184

Operating income

18,63534,032

Interest income

210

339

Dividend income

850

738

Gain on foreign currency exchange

1,078

1,316

Investment gain on equity method

691

1,442

2,241

1,345

5,070

5,179

Interest expense

1,823

1,663

Other

3,039

3,054

Total non-operating expenses

4,862

4,716

Ordinary income

18,84334,494

Loss on impaired assets

244

269

Total extraordinary losses

244

269

Income before income taxes

18,59934,225

Corporate income taxes

7,658

12,024

Quarterly net income before income or loss
adjustments on minority interests

10,941

22,202(234)

378

11,175

21,823Non-operating income

Other
Total non-operating income
Non-operating expenses

Extraordinary losses

Minority interests
Net income

12Consolidated Results for the Third Quarter
Ended December 31, 2014

Consolidated Statement of Comprehensive Income(Units: millions of yen)
Present Third Quarter
April 1, 2014, to December 31,
2014

Previous Third Quarter
April 1, 2013, to December 31,
2013
Amount

Net income before adjusting for profit (loss)
from minority interests

Amount10,941

22,202

Unrealized gains on securities

2,900

943

Profit (loss) on deferred hedge(273)(2,254)

13,598

3,593

―

(235)

(805)

―

Amount applied for equity method
accounting of affiliates

49

Total other comprehensive income

15,424

2,057

26,36524,25826,08023,776286

482

Other comprehensive income

Foreign currency translation adjustments
Adjustment to retirement benefits
Adjustment regarding pension obligationsof consolidated overseas subsidiaries

Comprehensive income(Breakdown)Comprehensive income relating to parent
company shareholdings
Comprehensive income relating tominority interests(3) Notes regarding Consolidated Quarterly Financial Statements(Notes on Premise of a Going Concern)
There are no applicable items.

(Notes regarding Significant Fluctuations to Shareholders’ Equity)
There are no applicable items.

(Subsequent Events of Significant Importance)
There are no applicable items.

13Consolidated Results for the Third Quarter
Ended December 31, 2014

4. Supplementary Information(1) Orders, Sales and Operational Profit, and Balance of Orders by Segment
Orders Received(Units: millions of yen)Segment

April 1, 2013, toDecember 31, 2013

April 1, 2014, toDecember 31, 2014

AmountAmountY/Y Change
Amount%Machinery Components

72,12878,3896,261

8.7

Precision Machinery

98,647

110,644

11,996

12.2

Construction Machinery

142,236

149,006

6,770

4.8

Industrial Machinery

54,762

63,992

9,230

16.9

Ships

24,12759,751

35,624

147.7

Environmental Facilities & Plants

71,61081,608

9,998

14.0

Other

8,839

7,956

(883)

(10.0)

Total

472,348551,345

78,997

16.7

Sales and Operational Profit(Units: millions of yen)Segment

April 1, 2013, toDecember 31, 2013
Operational
ProfitSales

April 1, 2014, toDecember 31, 2014
Operational
ProfitSales

Y/Y Change
Operational
ProfitSales

Machinery Components

72,8104,804

74,215

5,810

1,405

1,005

Precision Machinery

95,1296,523

107,121

10,406

11,992

3,882

Construction Machinery

140,277

6,229

144,528

10,655

4,251

4,426

Industrial Machinery

49,878897

51,532

3,374

1,654

2,477

Ships

10,356(2,239)18,659

(769)

8,303

1,469

Environmental Facilities & Plants

48,764751

64,805

3,057

16,040

2,306

Other

6,794

1,548

5,929

1,580

(864)

31

―

120

―

(80)

―

(201)

424,007

18,635

466,788

34,032

42,781

15,397

Adjustments
Total

14

Consolidated Results for the Third Quarter
Ended December 31, 2014

Balance of Orders Received(Units: millions of yen)Segment

End of Previous Fiscal
Year
As of March 31, 2014

End of Third Quarter
As of December 31,
2014

AmountAmountChangeAmount%Machinery Components

28,91933,093

4,174

14.4

Precision Machinery

41,75645,2793,523

8.4

Construction Machinery

27,55532,033

4,478

16.3

Industrial Machinery

80,14892,60812,460

15.5

Ships

28,40569,49741,092

144.7

Environmental Facilities & Plants

107,351

124,165

16,804

15.7

Other

3,765

5,792

2,027

53.8

Total

317,910

402,467

84,557

26.6

The Group’s operating segments are categorized as follows:Businesses

Main Products

Machinery Components

Power transmission and control equipment

Precision Machinery

Plastics machinery, film forming machines, semiconductor production equipment,
laser processing systems, cryogenic equipment, precision positioning equipment,
precision forgings, control components, defense equipment, machining tools

Construction Machinery

Hydraulic excavators, mobile cranes, road machinery

Industrial Machinery

Ion accelerators, medical machines and equipment, plasma coating systems for
FPDs, forging machines, material handling systems, logistics systems,
automated parking systems, turbines, pumps

Ships

Ships

Environmental Facilities & Plants

Private power generation facilities, boilers, industrial waste treatment facilities, air
pollution control equipment, water and sewage treatment systems, processequipment, pressure vessels, mixing vessels, air-conditioning equipment, foodprocessing machinery

Adoption of Accounting Standards for Retirement Benefits
As noted in the Changes to Accounting Policies section, as of the first quarter of the current consolidated fiscal year underreview, the method used to calculate retirement benefit obligations has been changed. Consequently, the method used to
calculate retirement benefit obligations and service costs has also been changed at the business segment level. However,
the impact of this change on segment income for the third quarter of the current consolidated fiscal year is considered tobe minimal.

15

Consolidated Results for the Third Quarter
Ended December 31, 2014

Changes to Depreciation Method for Tangible Fixed Assets
As mentioned in the “Changes to Accounting Policies That Are Difficult to Distinguish from Changes in Accounting-Based
Estimates” section, from the first quarter of the current consolidated fiscal year under review, the straight-line method has
been used to depreciate tangible fixed assets. As a result, the straight-line method has also been used to depreciate
assets at the business segment level. As a result of this change, the segment income for the third quarter of the current
consolidated fiscal year under review for Machinery Components, Precision Machinery, Construction Machinery,
Industrial Machinery, Environmental Facilities & Plant, and Others increased by JPY200 million, JPY561 million, JPY639
million, JPY213 million, JPY130 million, and JPY42 million, respectively, as compared to the previously used method.
Further, the segment loss improved by JPY34 million for the Ships segment.
Changes to the Measurement Methodology for Segment Income and/or Loss
In order to measure the financial performance of each business segment more accurately, the allocation method forresearch and development (R&D) costs has been changed from the first quarter of the current consolidated fiscal year
under review.
Please note that the segment information, including profit and loss figures, provided herein for the third quarter of theprevious consolidated fiscal year reflects the changes to the calculation methods noted above.

16

Consolidated Results for the Third Quarter
Ended December 31, 2014(2) (Summary) Consolidated Cash Flows Statement(Units: millions of yen)Previous Third Quarter
April 1, 2013, toDecember 31, 2013

Present Third Quarter
April 1, 2014, toDecember 31, 2014

Income before income taxes

18,59934,225

15,626

Depreciation

13,614

11,935(1,679)(Increase) decrease in notes and accounts
receivable

25,82931,368

5,539(Increase) decrease in inventories(14,260)(27,799)(13,539)

Increase (decrease) in notes and accounts
payable(4,401)

7,731

12,132

Payments for income taxes(8,079)(14,108)(6,029)Other(3,088)(2,654)434

28,214

40,69812,484

Payments for purchases of property, plant, andequipment(12,440)(10,765)

1,675

Cash outflow for loans(13,440)(1,349)12,090

3,295

3,193

(102)

(22,585)(8,921)

13,664

Net increase (decrease) in short-term loans

3,175(20,145)(23,320)

Cash dividends paid

(4,219)(5,336)(1,117)

Other(1,543)(1,378)165

Net cash used in financing activities(2,587)(26,860)(24,273)

Other

4,110

604

(3,506)

Cash and cash equivalents at beginning of period

46,47676,41829,942

Cash and cash equivalents at end of period

53,627

81,93928,312

Net cash provided by operating activities

Other
Net cash used in investing activities

17

Y/Y Change