Makita Corporation
Consolidated Financial Results
for the three months
ended June 30, 2015
(U.S. GAAP Financial Information)(English translation of "KESSAN TANSHIN"
originally issued in Japanese)

CONSOLIDATED FINANCIAL RESULTS
FOR THE THREE MONTHS ENDED JUNE 30, 2015 (Unaudited)
July 31, 2015

Makita Corporation
Stock code: 6586
URL: http://www.makita.co.jp/
Shiro Hori, President, Representative Director

1. Summary operating results of the three months ended June 30, 2015 (From April 1, 2015 to June 30, 2015)(1) CONSOLIDATED OPERATING RESULTS
Yen (millions)
For the three months ended
For the three months ended
June 30, 2014
June 30, 2015(%)(%)
Net sales................................................................
101,75412.1
107,574
5.7
Operating income .................................................
17,55764.5
17,338(1.2)
Income before income taxes .................................
17,24455.1
14,809(14.1)Net income attributable to Makita Corporation….
11,701
49.7
10,894(6.9)
Comprehensive income ........................................
10,087(53.8)
23,589133.9
Yen
Earning per share (Basic)
Net income attributable to
Makita Corporation common shareholders………
86.20
80.26
Notes:
1. Amounts of less than one million yen have been rounded.
2. The table above shows the changes in the percentage ratio of net sales, operating income, income before income
taxes, net income attributable to Makita Corporation, and comprehensive income (loss) against the corresponding
period of the previous year.
(2) SELECTED CONSOLIDATED FINANCIAL POSITION

Total assets ............................................................
Total equity ...........................................................
Total Makita Corporation shareholders' equity .....
Total Makita Corporation shareholders' equity
ratio to total assets (%) .........................................

Yen (millions)
As of March 31, 2015
As of June 30, 2015
575,328584,070489,585499,598
486,021495,769
84.5%

84.9%

2. Dividend Information
Yen
For the year ended
March 31, 2015

For the year ending
March 31, 2016
(Forecast)

Cash dividend per share:
Interim .................................................................
18.00
18.00
Year-end ..............................................................
100.00(Note)
Total ....................................................................
118.00(Note)
Note:
1. The forecast for cash dividend announced on April 28, 2015 has not been revised.
2. The projected amount of dividends for the year ending March 31, 2016 has not been determined yet. For further
details, refer to “Explanation regarding proper use of business forecast, and other significant matters” on page 3.

English translation of "KESSAN TANSHIN" originally issued in Japanese

13. Consolidated Financial Performance Forecast for the year ending March 31, 2016 (From April 1, 2015 toMarch 31, 2016)
Yen (millions)
For the six months ending
For the year ending
September 30, 2015
March 31, 2016(%)(%)
Net sales...................................................................
200,800(3.3)
400,000(3.5)
Operating income ....................................................
29,500(22.3)
56,500(21.4)
Income before income taxes ....................................
27,900(24.8)
53,000(22.5)Net income attributable to Makita Corporation .......
19,000(25.5)
36,000(20.5)
Yen
Earning per share (Basic)
Net income attributable to
Makita Corporation common shareholders ..............
139.98265.22Note:
The consolidated financial forecast for the year ending March 31, 2016 has not been revised.
4. Other(Refer to [Qualitative Information and Financial Statements] Section 4 “Other” on page 5.)(1) Changes in important subsidiaries during the period (Changes in specified subsidiaries accompanied by changes inscope of consolidation during the quarter): Not applicable(2) Adoption of simplified accounting methods and accounting methods that are specific to the preparation of quarterly
consolidated financial statements: Yes(3) Changes in accounting policies, procedures and presentation rules applied in the preparation of the quarterly
consolidated financial statements:
1. Changes due to revisions to accounting standards: Not applicable
2. Changes due to other reasons: Not applicable(4) Number of shares outstanding (common stock)
1. Number of shares issued (including treasury stock):
2. Number of treasury stock:
3. Average number of shares outstanding:

English translation of "KESSAN TANSHIN" originally issued in Japanese

As of June 30, 2015:
As of March 31, 2015:
As of June 30, 2015:
As of March 31, 2015:
For the three months ended
June 30, 2015:
For the three months ended
June 30, 2014:

140,008,760
140,008,760
4,274,271
4,273,892
135,734,704
135,737,380

2

Information regarding quarterly review
This consolidated financial results report is not subject to a quarterly review stipulated under the Financial
Instruments and Exchange Act. As of the release date of this document, the quarterly review under the Financial
Instruments and Exchange Act has not been completed.
Explanation regarding proper use of business forecasts, and other significant matters
1. Regarding the assumptions for the forecasts and other matters, refer to [Qualitative Information and Financial
Statements] Section 3 “Explanation of Information Relevant to Forecast such as Consolidated Financial Performance
Forecast” on page 4. The financial forecast given above are based on information as available at the present time, andinclude potential risks and uncertainties. As a consequence of the factors above and other, actual results may varyfrom the forecasts provided above.
2.

Makita's basic policy on the distribution of profits is to maintain a consolidated dividend payout ratio of 30% or greater,
with a lower limit on annual cash dividends of 18 yen per share. However, in the event special circumstances arise,computation of the amount of dividends will be based on consolidated net income attributable to Makita Corporation after
certain adjustments.
The Board of Directors plans to meet in April 2016 for a report on earnings for the year ending March 31, 2016. At thetime, in accordance with the basic policy regarding profit distribution mentioned above, the Board of Directors plans topropose a dividend equivalent to at least 30% of net income attributable to Makita Corporation. The Board of Directors willsubmit this proposal to the General Meeting of Shareholders scheduled for June 2016.
The consolidated dividend payout ratio is calculated as annual dividends per share divided by consolidated net income
attributable to Makita Corporation per share (after adjustments for special circumstances) and multiplied by 100.

English translation of "KESSAN TANSHIN" originally issued in Japanese

3

[Qualitative Information and Financial Statements]
1. Explanation of Consolidated Operating Results
Looking at the global economic situation during the first three-month (the “period”) ended June 30, 2015, theWestern European economy remained sluggish, mainly due to the impact of economic sanctions by Europe and the U.S.
on the Russian economy, while major countries’ economies remained solid. The U.S. economy kept recovering
gradually against a backdrop of robust housing investment. The Asian economy lost momentum on the back of a weak
Chinese economy. Meanwhile, the Japanese economy was on a recovery trend, though consumer spending remainedsluggish following the increase of the consumption tax rate in April 2014.
Our consolidated net sales for this period increased by 5.7% to 107,574 million yen compared to the same period of
the previous year due to robust sales in overseas markets as well as general depreciation of the yen compared with thesame period of the previous year. Operating income decreased by 1.2% to 17,338 million yen (operating income ratio:
16.1%), owing to deterioration in the cost-of-sales ratio. Income before income taxes decreased by 14.1% to 14,809
million yen (income before income taxes ratio: 13.8%) and net income attributable to Makita Corporation shareholders
decreased by 6.9% to 10,894 million yen (ratio of net income attributable to Makita Corporation shareholders: 10.1%)
since non-operating expenses increased by recording a loss on the valuation of securities held.
Net sales in Japan increased by 2.2% to 15,970 million yen compared to the same period of the previous year. Thiswas due to efforts to increase sales of lithium-ion battery products, which more than offset negative effects from weak
housing starts.
Net sales in Europe decreased by 1.4% to 44,452 million yen. This was because of sluggish sales to Russia, despiterobust sales in major Western European countries.
Net sales in North America increased by 28.0% to 17,443 million yen. This was due to favorable construction
activities of housing and commercial property, as well as the yen’s depreciation against the U.S. dollar compared to thesame period of the previous year.
Net sales in Asia was mixed from country to country, but increased by 8.0% to 9,899 million yen. This was becauseof the yen’s depreciation against local currencies compared to the previous year.
Sales situations in other regions are as follows. Net sales in Central and South America increased by only 0.4% to7,293 million yen compared to the previous year due to the yen’s appreciation against local currencies, despite efforts to
expand sales amid the sluggish economy. In addition, net sales in Oceania increased by 20.8% to 6,620 million yen andthose in the Middle East and Africa increased by 7.0% to 5,897 million yen because demand recovered in these regions.

2. Explanation of Consolidated Financial Position
Total assets as of June 30, 2015 increased by 8,742 million yen to 584,070 million yen compared to the balance asof March 31, 2015. The increase was mainly due to the increase in “Inventories”.
Total liabilities as of June 30, 2015 decreased by 1,271 million yen to 84,472 million yen compared to the balance
as of March 31, 2015. This decrease was mainly due to the decrease in “Accrued payroll”.
Total equity as of June 30, 2015 increased by 10,013 million yen to 499,598 million yen compared to the balance asof March 31, 2015. The increase was mainly due to the increase in “Foreign currency translation adjustment”
in “Accumulated other comprehensive income”.

3. Explanation of Information Relevant to Forecast such as Consolidated Financial Performance Forecast
We have made no revision to the performance forecast released on April 28, 2015, because of uncertainties in theoutlook of business environment surrounding Makita’s business results.

English translation of "KESSAN TANSHIN" originally issued in Japanese44. Other(1) Changes in important subsidiaries during the period (Changes in specified subsidiaries accompanied by changes inscope of consolidation during the quarter): None
(2) Adoption of simplified accounting methods and accounting methods that are specific to the preparation of quarterly
consolidated financial statements:
With regard to the income tax expenses, Makita computes interim income tax expense by multiplying
reasonably estimated annual effective tax rate, which includes the effects of deferred taxes, by year-to-date income
before income taxes for the reporting period.
(3) Changes in accounting principles, procedures and presentations: None

English translation of "KESSAN TANSHIN" originally issued in Japanese

55. Consolidated Financial Statements (Unaudited)(1) Consolidated Balance Sheets
Yen (millions)
As of March 31, 2015
As of June 30, 2015
Composition ratio

Composition ratio

ASSETS
CURRENT ASSETS:
Cash and cash equivalents.................................................

94,52984,607

Time deposits ....................................................................

15,283

19,820

Short-term investments .....................................................

56,07651,474

Notes..............................................................................

1,315

1,341

Accounts ........................................................................

64,642

68,276Less- Allowance for doubtful receivables .....................

(998)

(992)

Inventories ........................................................................

175,186

187,286

Deferred income taxes ......................................................

6,296

5,645

Prepaid expenses and other current assets ........................

16,782

18,912

Total current assets ........................................................

429,111

Trade receivables-

74.6%

436,369

74.7%

PROPERTY, PLANT AND EQUIPMENT, AT COST:
Land ..................................................................................

23,104

23,399Building and improvements ..............................................

96,202

97,993

Machinery and equipment .................................................

91,353

94,078Construction in progress ...................................................

3,237

4,190

Sub total ........................................................................

213,896219,660

Less- Accumulated depreciation and amortization ...........

(118,084)(121,192)

Total net property, plant and equipment.........................

95,812

16.7%

98,468

16.9%

INVESTMENTS AND OTHER ASSETS:
Investments .......................................................................

31,39529,860Goodwill ...........................................................................

721

721

Other intangible assets, net ...............................................

4,563

4,502

Deferred income taxes ......................................................

629

672

Other assets .......................................................................

13,097

13,478

Total investments and other assets .................................

50,405

8.7%

49,233

8.4%

Total assets ...............................................................................

575,328100.0%

584,070

100.0%English translation of "KESSAN TANSHIN" originally issued in Japanese

6Yen (millions)
As of March 31, 2015
As of June 30, 2015
Composition ratio

Composition ratio

LIABILITIESCURRENT LIABILITIES:
Short-term borrowings ......................................................

4,647

4,895

Trade notes and accounts payable .....................................

25,12423,353

Other payables ..................................................................

6,140

7,147

Accrued expenses..............................................................

10,594

10,601

Accrued payroll.................................................................

9,568

7,363

Income taxes payable ........................................................

5,353

3,613

Deferred income taxes ......................................................

1,529

1,753

Other liabilities .................................................................

7,911

10,444

Total current liabilities ...................................................

70,866

12.3%

69,169

11.9%

LONG-TERM LIABILITIES:Long-term indebtedness ....................................................

383

405

Accrued retirement and termination benefits ....................

3,701

3,849

Deferred income taxes ......................................................

9,521

9,675

Other liabilities .................................................................

1,272

1,374

Total long-term liabilities...............................................

14,877

2.6%

15,303

2.6%

Total liabilities ...............................................................

85,74314.9%

84,472

14.5%

EQUITYMAKITA CORPORATION SHAREHOLDERS’
EQUITY:
Common stock .................................................................

23,80523,805Additional paid-in capital ................................................

45,42145,421

Legal reserve....................................................................

5,669

5,669

Retained earnings.............................................................

399,874

397,195

Accumulated other comprehensive income .....................

22,84235,272

Treasury stock, at cost......................................................

(11,590)(11,593)

Total Makita Corporation shareholders’ equity....................

486,02184.5%

495,769

84.9%

NON-CONTROLLING INTEREST ...................................

3,564

0.6%

3,829

0.6%

Total equity ....................................................................

489,58585.1%

499,598

85.5%

Total liabilities and equity........................................................

575,328100.0%

584,070

100.0%

As of March 31, 2015

As of June 30, 2015

Total number of shares authorized .......................................

496,000,000

496,000,000

Number of shares issued.......................................................

140,008,760

140,008,760

Number of shares issued (excluding treasury stock) ............

135,734,868

135,734,489

Number of treasury stock .....................................................

4,273,892

4,274,271

English translation of "KESSAN TANSHIN" originally issued in Japanese7(2) Consolidated Statements of Income
Yen (millions)
For the three months
For the three months
ended June 30, 2014
ended June 30, 2015
Composition ratio

Composition ratio

101,754 100.0%

107,574 100.0%

Cost of sales .............................................................................

63,08862.0%

68,026

63.2%

GROSS PROFIT..........................................................................

38,66638.0%

39,54836.8%

Selling, general, administrative and others, net ........................

21,10920.7%

22,21020.7%

OPERATING INCOME ..............................................................

17,55717.3%

17,33816.1%

NET SALES ................................................................................

OTHER EXPENSEInterest and dividend income ...................................................

681

826

Interest expense ........................................................................

(55)

(33)

Exchange gains on foreign currency transactions, net..............

(977)

573

Realized gains (losses) on securities, net .................................

38

772

Valuation losses on securities ...................................................

-(4,667)

Total other expense, net ........................................................

(313)(0.4%)(2,529)(2.3%)

INCOME BEFORE INCOME TAXES .......................................

17,24416.9%

14,80913.8%

Provision for income taxes:
Current......................................................................................

3,516

4,081

Deferred....................................................................................

1,916

(276)

Total income tax expense ......................................................

5,432

5.3%

3,805

3.6%

NET INCOME .............................................................................

11,812

11.6%

11,00410.2%

Less-Net income attributable to the non-controlling interest .......

111

0.1%

110

0.1%

NET INCOME ATTRIBUTABLE TO MAKITA CORPORATION .......

11,701

11.5%

10,894

10.1%

Consolidated Statements of Comprehensive Income
Yen (millions)
For the three months
For the three months
ended June 30, 2014
ended June 30, 2015
11,812

11,004Foreign currency translation adjustment ..................................

(2,726)

11,189Unrealized holding gains on available-for-sale securities ...................

963

1,681

Pension liability adjustment .....................................................

38

(285)

Total other comprehensive income (loss)..............................

(1,725)

12,585COMPREHENSIVE INCOME ...................................................

10,087

23,589Less-Comprehensive income attributable to thenon-controlling interest ............................................................

29

265

COMPREHENSIVE INCOME ATTRIBUTABLE TO
MAKITA CORPORATION .....................................................

10,05823,324NET INCOME .............................................................................
OTHER COMPREHENSIVE INCOME (LOSS): ......................

English translation of "KESSAN TANSHIN" originally issued in Japanese8(3) Consolidated Statements of Cash Flows
Yen (millions)
For the three months
For the three months
ended June 30, 2015
ended June 30, 2014
CASH FLOWS FROM OPERATING ACTIVITIES:Net income……………………………………………………………
Adjustments to reconcile net income to net cash provided byoperating activities-

11,812

11,004

Depreciation and amortization ......................................................

2,029

2,261

Deferred income tax expense (benefit) .........................................

1,916

(276)

Realized gains on securities, net ...................................................

(38)

(772)

Valuation losses on securities .......................................................

-

4,667

Losses on disposal or sales of property, plant and equipment, net

75

4Changes in assets and liabilitiesTrade receivables .......................................................................

2,172(1,526)Inventories .................................................................................

(2,735)(5,753)

Trade notes and accounts payable and accrued expenses ..........

(2,310)(3,052)

Income taxes payable .................................................................

(5,588)(2,044)

Accrued retirement and termination benefits .............................

(266)

(634)

Other, net .......................................................................................

(1,088)(1,045)

Net cash provided by operating activities ......................................

5,979

2,834

Capital expenditures, including interest capitalized ............................

(4,379)(3,206)

Purchases of available-for-sale securities ............................................

(124)(6,339)Proceeds from sales of available-for-sale securities ............................

14,106

11,166

Proceeds from maturities of held-to-maturity securities ......................

1,200

300

Proceeds from sales of property, plant and equipment ........................

42

82

Investment in time deposit ...................................................................

(543)(6,840)Withdrawal of time deposit .................................................................

515

2,576

Other, net .............................................................................................

(39)

5

Net cash provided by (used in) investing activities .......................

10,778(2,256)

CASH FLOWS FROM FINANCING ACTIVITIES:
Additions to borrowings with original maturities of three months or
less, net ................................................................................................
Payments on borrowings with original maturities of more than threemonths .................................................................................................

34

138

(974)

-

Purchase of treasury stock, net ............................................................

(4)

(3)

Cash dividends paid .............................................................................

(9,909)(13,573)

Other, net .............................................................................................

930

1,186

Net cash used in financing activities ..............................................
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND
CASH EQUIVALENTS ......................................................................

(9,923)(12,252)

(432)

1,752

NET CHANGE IN CASH AND CASH EQUIVALENTS .................

6,402(9,922)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD ...

81,732

94,529CASH AND CASH EQUIVALENTS, END OF PERIOD .................

88,13484,607

CASH FLOWS FROM INVESTING ACTIVITIES:(4) Notes on the assumptions for a going concern: None
(5) Note in case there is any significant change in the shareholders’ equity: None

English translation of "KESSAN TANSHIN" originally issued in Japanese9(6) Condensed Operating Segment Information
Yen (millions)
For the three months ended June 30, 2014
North
Asia
Other area
Total
America

Eliminations

Consolidated

101,754
63,275(63,275)

101,754-

16,249165,029(63,275)

101,754

41,472

15,062

146,241(62,044)

84,197

7,171

1,187

18,788(1,231)

17,557

Yen (millions)
For the three months ended June 30, 2015
North
Asia
Other area
Total
America

Eliminations

Consolidated

Japan

Europe(2) Inter-segment .......

21,233
17,72945,0671,182

14,020906

5,206
43,437

16,22821

Total ................

38,962

46,24914,926

48,643Operating expenses .......

34,302

41,035

14,370Operating income .........

4,660

5,214

556

Sales:(1) Externalcustomers ...............

Japan

Europe(2) Inter-segment .......

21,836
18,40544,561
1,247

17,9461,081

6,012
50,322

17,21946

107,574
71,101(71,101)

107,574-

Total ................

40,24145,80819,02756,334

17,265

178,675(71,101)

107,574

Operating expenses .......

35,496

41,34018,314

49,152

16,772

161,074(70,838)

90,236

Operating income .........

4,745

4,468

713

7,182

493

17,601(263)

17,338

Sales:(1) Externalcustomers ...............

English translation of "KESSAN TANSHIN" originally issued in Japanese

10

SUPPORT DOCUMENTATION (CONSOLIDATED)
1. Consolidated Financial Results and Forecast
Yen (millions)
For the three months
For the three months
ended June 30, 2015
ended June 30, 2014(%)

Net sales.....................................................................................................
Domestic ...............................................................................................
Overseas ................................................................................................
Operating income ......................................................................................
Income before income taxes ......................................................................
Net income attributable to Makita Corporation .........................................
Earning per share (Basic)
Net income attributable to
Makita Corporation common shareholders (Yen) .....................................
Number of Employees ...............................................................................

For the year ended
March 31, 2015(%)

Net sales.............................................................
Domestic .......................................................
Overseas ........................................................
Operating income ..............................................
Income before income taxes ..............................
Net income attributable to
Makita Corporation ............................................
Earning per share (Basic)

101,754
15,633
86,121
17,557
17,244
11,701

12.1
11.6
12.2
64.5
55.1
49.7

(%)

107,574
15,97091,604
17,33814,80910,894

5.7
2.2
6.4
(1.2)
(14.1)(6.9)

86.20
12,76880.26
13,637

Yen (millions)
For the six months
ending September 30,
2015 (Forecast)

For the year ending
March 31, 2016
(Forecast)

(%)

(%)

414,718
67,740346,978
71,90568,394

8.2
2.6
9.4
30.9
20.0

200,800 (3.3)
31,500 (2.9)
169,300 (3.4)
29,500 (22.3)
27,900 (24.8)

400,000 (3.5)
64,800 (4.3)
335,200 (3.4)
56,500 (21.4)
53,000 (22.5)

45,30717.8

19,000 (25.5)

36,000 (20.5)

Net income attributable to Makita Corporation

333.79139.98265.22
common shareholders (Yen) ..............................
13,835
Number of Employees .......................................
Notes:
1. The table above shows the changes in the percentage ratio of Net sales, Operating income, Income before
income taxes, and Net income attributable to Makita Corporation against the corresponding period of theprevious year.
2. Please refer to [Qualitative Information and Financial Statements] Section 3 “Explanation of Information
Relevant to Forecast such as Consolidated Financial Performance Forecast” on page 4.

English translation of "KESSAN TANSHIN" originally issued in Japanese112. Consolidated Net Sales by Geographic Area
For the three months
ended June 30, 2014

Yen (millions)
For the three months
ended June 30, 2015

For the year ended
March 31, 2015

(%)

(%)

(%)

Japan ................................................................
15,633
11.6
15,9702.2
67,7402.6
Europe..............................................................
45,07411.8
44,452(1.4)
175,254
6.0
North America .................................................
13,62814.2
17,44328.0
57,168 14.6
9,899
8.0
39,643 13.3
Asia ..................................................................
9,163
9.5
Other regions ...................................................
18,25613.2
19,8108.5
74,913
11.9
Central and South America ........................
7,263
5.8
7,293
0.4
30,287
7.9
5,897
7.0
23,759 14.2
Oceania ......................................................
5,513
10.1
The Middle East and Africa .......................
5,480
29.0
6,620
20.8
20,867 15.5
Total .................................................................
101,75412.1
107,574
5.7
414,718
8.2
Note: The table above sets forth Makita's consolidated net sales by geographic area based on the customer’s location forthe periods presented. Accordingly, it differs from “Condensed Operating Segment Information” on page 10. The
table above shows the changes in the percentage ratio of net sales compared to the corresponding period of theprevious year.
3. Exchange Rates

Yen/U.S. Dollar........
Yen/Euro ..................

For the threemonths ended
June 30, 2014

For the threemonths ended
June 30, 2015

102.17140.07121.43134.21Yen
For the year
ended March 31,
2015
109.76
138.69For the year
ending March
31, 2016(Forecast)
120
125

4. Production Ratio (unit basis)
For the threemonths ended
June 30, 2014
Composition ratio

Domestic .....................................................................
Overseas .....................................................................

10.1%
89.9%

For the threemonths ended
June 30, 2015
Composition ratio

10.4%
89.6%

5. Consolidated Capital Expenditures, Depreciation and Amortization, and R&D cost
Yen (millions)
For the three
For the year
For the threemonths ended
ended
months ended
June 30, 2015
March 31, 2015
June 30, 2014
Capital expenditures ..................
Depreciation and amortization ...
R&D cost ...................................

4,379
2,029
2,181

3,206
2,261
2,264

English translation of "KESSAN TANSHIN" originally issued in Japanese

12,1248,619
9,117

For the year
ended
March 31, 2015
Composition ratio

10.3%
89.7%

For the year
endingMarch 31, 2016
(Forecast)
14,5009,200
10,70012