FOR IMMEDIATE RELEASE
Kurita Water Industries Ltd. Reports Earnings for the Fiscal Year ended March 31, 2023
Tokyo, Japan, May 11, 2023 - Kurita Water Industries Ltd. (the “Company”) (TSE Securities Code6370) announced net sales of 344,608 million yen and profit attributable to owners of parent of 20,134
million yen, or 179.14 yen per share, for the year ended March 31, 2023 (April 1, 2022 - March 31,2023).
Results of Operations
Total consolidated orders for the Kurita Group (the “Group”) in the fiscal year ended March 31, 2023
increased 18.7% from the level of the previous fiscal year, to 374,268 million yen, and net sales rose
19.6%, to 344,608 million yen. Business profit* increased 17.1%, to 38,589 million yen, operating
profit was 29,058 million yen, down 18.7% versus the year-ago period, profit before tax was 30,151
million yen, rising 0.2%, and profit attributable to owners of parent amounted to 20,134 million yen,up 9.0%.
During the fiscal year, other income of 1,564 million yen and other expenses of 11,095 million yen
were posted. Other income declined 4,555 million yen, reflecting a one-time profit (a gain on sale of
fixed assets) from the sale of real estate in the previous fiscal year. Other expenses included a goodwill
impairment loss of 7,646 million yen related to Kurita America, Inc. (Water Treatment Chemicals
business) and increased 7,766 million yen from the year-ago period.
An impairment test is performed each year and every time that there are any signs of an impairment.
Meanwhile, the goodwill impairment loss at Kurita America, Inc. (Water Treatment Chemicals
business) is calculated by comparing the value in use and accounting book value. The value in use iscalculated by discounting the expected future cash flows using an appropriate discount rate. In the
United States, the discount rate used in the calculation of value in use rose to 10.8% in the fiscal year
under review (9.5% a year earlier), due to policy interest rate hikes to curb inflation. Future cash flows
were estimated carefully and the business plan of Kurita America Inc., the basis of an estimate of future
cash flows at the end of the previous fiscal year, was revised downward considering changes in thewater treatment chemicals market in the United States following the outbreak of COVID-19 and resultsin the fiscal year under review, which were affected by disruptions to logistics and rising prices, aswell as results in previous fiscal years. As a result, the value in use was less than the accounting bookvalue, and an impairment loss is recognized.
In the fiscal year under review, the Company underwrote a capital increase at Kurita America
Holdings Inc. to help it acquire additional shares in US-based subsidiary Pentagon Technologies Group,
Inc. (Water Treatment Facilities business) (and make it a wholly owned subsidiary) and completed thepayment. The Company posted in finance income a gain on derivatives transactions of 1,090 million
yen from a foreign exchange contract it entered into after deciding to underwrite the capital increase.
Meanwhile, finance costs of 5,496 million yen posted in the same period of the previous fiscal yearthat resulted from the subsequent measurement of liabilities related to a forward contract concluded
with the non-controlling shareholders of Pentagon Technologies Group, Inc. (Water Treatment
Facilities business) were eliminated. Those factors contributed to the increases in profit before tax andprofit attributable to owners of parent.
During the fiscal year ended March 31, 2023, uncertainty in the global economy increased, reflecting
a disruption in supply chains and sharp rises in prices of raw materials and energy chiefly due to theprolonged war in Ukraine and the resurgence in COVID-19 cases. However, the global economy
continued to recover moderately.
Looking at the market conditions surrounding the Group, production activities in the manufacturingindustry in Japan were weak in certain sectors chiefly due to semiconductor shortages and supply
shortages of raw materials in the first half of the fiscal year under review. Meanwhile, signs remained ofa recovery in capital investment. Overseas, there were signs of a recovery in the U.S. economy and theeconomies in Europe and Asian countries excluding China. Meanwhile, in China, the economy slowed
due to the lingering effects of lockdowns and movement restrictions to block the spread of COVID-19.
1

In this environment, the Group stepped up initiatives to propose total solutions that would help solve
customer issues such as the reduction of the environmental impact, including water saving, the reductionof CO2 emissions and waste reduction, and an improvement in productivity, while expanding the CSV(creating shared value) business based on a deep understanding of social and customer issues, aiming tooffer its value proposition to customers and society and establish a firm base for earnings. To lay thefoundation for growth, the Group is promoting application of best practices in the service contract-typebusiness and is striving to expand its services lineup in the service contract-type business to meet a wider
range of diverse customer needs. To improve the cost structure, the Group is developing a system tooptimize supply chains and taking steps to deal with increasing raw materials and distribution costs.
* Business profit is the Group’s own indicator that measures constant business performance. It is net
sales less cost of sales and selling, general and administrative expenses. Although business profit is
not defined by IFRS, the Group voluntarily discloses it, believing that it is beneficial for users of its
financial statements.
Segment Information
The Group consists of two reportable segments in its segment information: Water Treatment
Chemicals and Water Treatment Facilities.
Water Treatment Chemicals
Total Group orders for the Water Treatment Chemicals segment were 136,863 million yen, up 15.6%
versus the year-ago period, while net sales rose 15.7%, to 136,139 million yen.
In terms of profits, business profit amounted to 16,286 million yen, an increase of 19.8% year on year
chiefly due to an increase in net sales, which more than offset a rise in expenses chiefly due to increases
in raw materials prices and distribution costs. Operating profit stood at 7,606 million yen, down 47.8%
year on year, reflecting a goodwill impairment loss of 7,646 million yen at Kurita America, Inc.
In Japan, orders and net sales increased from the year-ago period, chiefly reflecting price hikes anda focus put on proposals for service contract-type projects that help customers reduce theenvironmental impact and costs, despite the effects of supply shortages of semiconductors and otherraw materials on capacity utilization at certain customers’ plants. Overseas, both orders and net sales
increased, reflecting sales price increases in response to sharp rises in raw materials prices and logistics
costs and an increase in results in yen at overseas subsidiaries due to the weaker yen as well as theresults of the development of high value-added services, including the CSV (creating shared value)
business.
Water Treatment Facilities
Total Group orders for the Water Treatment Facilities segment were 237,404 million yen, up 20.6%
versus the same period of the previous fiscal year. Net sales increased 22.2%, to 208,468 million yen.
In terms of profits, business profit amounted to 22,378 million yen, an increase of 15.4% year on
year, and operating profit rose to 21,526 million yen, up 1.7% year on year, chiefly due to an increasein net sales, which more than offset a rise in expenses related to the procurement of raw materials andparts.
In Japan, orders for water treatment facilities for the electronics industry took a significant downturn
after orders for large projects were posted in the previous fiscal year, but still orders were at a highlevel. Net sales rose significantly, chiefly due to the posting of sales from the order backlog. Orders
and net sales for maintenance services for the industry both increased, reflecting the expansion offacilities and the posting of orders for and sales from repairs, including the replacement of consumables,
against a backdrop of firm capacity utilization at customers’ plants. Orders for water treatment
facilities for general industries climbed, reflecting cancellations of orders for large projects received
in the previous fiscal year, but net sales declined. Orders and net sales of maintenance services for thisindustry both increased because of a recovery in maintenance demand. Both orders for and net sales
from water treatment facilities for the electric power industry decreased. Orders for soil remediation2

services decreased, but net sales increased, reflecting demand for small and medium-sized projects.
Overseas, both orders and net sales increased due to an increase in results in yen at overseas
subsidiaries associated with the weaker yen, and the posting of orders and sales of large water treatment
facilities projects in the electronics industry in East Asia.
Total net sales in the ultrapure water supply business in Japan and overseas increased due in part tothe contribution of a contract that began in the fiscal year under review.
Financial Condition
1) Total assets: 501,538 million yen, an increase of 31,557 million yen from the end of the previous
fiscal year
Current assets totaled 196,416 million yen, an increase of 18,020 million yen from the end of theprevious fiscal year ended March 31, 2022. This was mainly due to an increase of 11,407 million yen
in trade and other receivables and increases in cash and cash equivalents and inventories of 4,737
million yen and 3,715 million yen, respectively.
Non-current assets totaled 305,121 million yen, an increase of 13,536 million yen from the end of
the previous fiscal year. Property, plant and equipment increased 17,703 million yen chiefly due to theacquisition of new facilities in the ultrapure water supply business (Water Treatment Facilities
business). Other financial assets decreased 7,578 million yen while deferred tax assets increased 3,913
million yen owing mainly to the sale of a part of shares owned for policy purposes.
2) Liabilities: 205,778 million yen, an increase of 13,659 million yen from the end of the previous
fiscal year
Current liabilities totaled 109,468 million yen at the end of the period, a decrease of 4,459 million yen
from the end of the previous fiscal year. This is chiefly attributable to a decrease of 19,610 million yen
in other financial liabilities mainly due to the implementation of the forward contract concluded with
the non-controlling shareholders of US-based Pentagon Technologies Group, Inc. (Water Treatment
Facilities business) and a decrease in trade and other payables of 6,502 million yen, which werepartially offset by an increase of 20,818 million yen in bonds and borrowings chiefly due to theissuance of commercial paper and new borrowings.
Non-current liabilities totaled 96,310 million yen, an increase of 18,119 million yen from the end of
the previous fiscal year. This principally reflected an increase in bonds and borrowings of 17,805
million yen mainly due to the issuance of the second series of unsecured bonds (10,000 million yen)and new borrowings.
3) Equity: 295,759 million yen, an increase of 17,897 million yen from the end of the previous fiscal
yearThis principally reflected an increase of 17,566 million yen in retained earnings primarily due to profit
attributable to owners of parent posted.
Cash Flows
Consolidated net cash and cash equivalents at the end of the fiscal year ended March 31, 2023 totaled
50,468 million yen, an increase of 4,737 million yen from the end of the previous fiscal year ended
March 31, 2022.
The various cash flows and related factors are outlined below.
1) Cash Flows from Operating Activities
Net cash provided by operating activities during the fiscal year ended March 31, 2023 totaled 48,631
million yen, an increase of 19,894 million yen from the previous fiscal year. Inflows from profit before
tax of 30,151 million yen and depreciation, amortization and impairment loss of 37,276 million yen
were partly offset by income taxes paid of 17,094 million yen and an increase in trade and otherreceivables of 10,172 million yen.

32) Cash Flows from Investing Activities
Net cash used in investing activities totaled 46,274 million yen, an increase of 6,345 million yen fromthe same period of the previous fiscal year. Outflows chiefly from purchases of property, plant andequipment of 53,384 million yen were partly offset by inflows mainly from proceeds from sale ofinvestment securities of 8,854 million yen.
3) Cash Flows from Financing Activities
Net cash provided by financing activities totaled 1,101 million yen, an increase of 9,028 million yen
from the previous fiscal year. Inflows chiefly from a net increase in short-term borrowings andcommercial paper of 18,722 million yen, proceeds from long-term borrowings of 9,988 million yen,and proceeds from the issuance of bonds of 9,955 million yen were partly offset by the purchase ofshares of subsidiaries not resulting in change in scope of consolidation of 23,272 million yen anddividends paid of 8,699 million yen.
The Group’s basic policy is to constantly secure the liquidity necessary for business operations andestablish a stable funds-raising system. Short-term working capital, capital investment and otherinvestments in growth fields depend chiefly on the Group’s own funds, but the Group procuresfinancing through bond markets and bank loans as needed. As of the end of the fiscal year under review,
the Group has concluded commitment line contracts with two financial institutions (no borrowing
executed and unexecuted borrowings within the commitment line was 20,000 million yen).
(Reference) Indicators related to cash flow
Year ended
Year ended
Year ended
Year ended
Year ended
March 31, 2019 March 31, 2020 March 31, 2021 March 31, 2022 March 31, 2023
Ratio of equity attributable to ownersof parent (%)

66.0

62.5

59.6

57.9

58.6

Ratio of equity attributable to ownersof parent based on market value (%)

88.3

72.3

125.4

108.7

135.4

Ratio of interest-bearing debt to cash
flows (%)

39.6

148.1

130.3

207.0

207.4

Interest coverage ratio (times)

115.9

126.3

187.8

123.9

124.1

(Notes) Ratio of equity attributable to owners of parent: Equity attributable to owners of parent / Total assets
Ratio of equity attributable to owners of parent based on market value: Market capitalization / Total assets
Ratio of interest-bearing debt to cash flows: Interest-bearing debt / Cash flow
Interest coverage ratio: Cash flow / Interest payments
1. Each indicator is calculated based on consolidated financial figures.
2. Market capitalization is calculated based on the number of shares outstanding excluding treasury stock.
3. Cash flow is net cash provided by operating activities.
4. Interest-bearing debt includes all liabilities requiring the payment of interest under the liabilities section of theconsolidated statement of financial position.

Outlook for Overall Business, Including Production, Sales, and Profits and Losses
The global economy is slowing moderately, reflecting higher prices, a downturn in domestic demand
due to monetary tightening, and a temporary slowdown in the Chinese economy due to the COVID19 pandemic. Although inflation is expected to fall in the United States and the euro area, economic
growth will likely slow. In the semiconductor market, negative growth is expected chiefly due toinventory adjustments resulting from a slowdown in strong demand for personal computers andsmartphones from those working at home during the pandemic and a slowdown in the Chinese
economy, the largest consuming country. In the Japanese economy, growth, particularly growth indomestic demand, will continue. Higher prices will put downward pressure on households’ purchasing
power and consumer spending, but consumer spending will be supported by higher wages partly due
to labor shortage. There is likely to be steady capital investment from a medium to long-term
perspective, such as investment in digitalization and decarbonization. The Company’s forecasts of4

consolidated results are based on that assumption.
The forecasts do not reflect causes for concern over a further slowdown in the global economy,
including increasing energy inventories due to growing geopolitical risks, reviews of supply chainsdue to the strengthening of economic security, and delays in curbing inflation in the United States. In
that case, capacity utilization at plants of customers may fall and capital expenditures may be
postponed. It is also possible that business activities at the Group will be delayed. If the actuallysituation becomes very different from our assumption, our business will be affected and the forecasts
may have to be revised.
The consolidated results forecasts for the first half of the fiscal year ending March 31, 2024 and thefull year are as shown below.
(The percentages are year-on-year changes.)First half of the fiscal year
(April 1, 2023
- September 30, 2023)

Full year(April 1, 2023
- March 31, 2024)

Million yen%

Million yen%

Net sales

181,000

12.6

375,000

8.8

Business profit

16,200(2.5)

40,000

3.7

Operating profit

15,700(4.0)

39,00034.2

Profit before tax

15,500(11.5)

38,200

26.7

Profit attributable to owners of parent

10,500(15.2)

27,00034.1

The business forecasts are made by the Company based on information available at the time of
publication of this report and may differ from actual results due to changes in a range of factors.
Outlook by Segment
The Group has divided its business into segments by business type, namely the Water Treatment
Chemicals business and Water Treatment Facilities business, for performance management. From thefiscal year ending March 31,2024, the Group will divide its business into segments by customer
industries, namely the Electronics Industries and General Industries.
Electronics Industries
Orders are likely to take a downturn after strong demand in the previous fiscal year, but net sales are
expected to increase due to an accumulated backlog of orders. Business profit and operating profit are
expected to decline due to the adverse effect of a smaller percentage of sales accounted for by theservice business, which will more than offset the effect of the expected increase in net sales.
General Industries
Orders will increase mainly due to growth in the overseas chemicals business, and net sales will risedue to progress in the construction of facilities and maintenance projects in addition to growth in thechemicals business. Due to the increase in net sales, business profit is expected to increase. Operating
profit is likely to rise significantly, reflecting a goodwill impairment loss posted in relation to Kurita
America, Inc. in the previous fiscal year.
Dividend Policy and Dividends for the Fiscal Year ended March 31, 2023 and the Fiscal Yearending March 31, 2024
Kurita Water Industries’ basic policy is to provide shareholders with stable dividends.
Setting a payout ratio of 30 to 50% as our target, we will work to continue to increase dividends,
making decisions based on the payout ratios for the most recent five years to respond flexibly tofluctuations in business performance each year. In using retained earnings, we will maintain capitaldiscipline and will prioritize promising business fields that are expected to grow. If we have decided
that there are excess funds, we will take steps to improve capital efficiency and return profits toshareholders, including the acquisition of treasury stock, taking the share price into consideration.
5

We intend to pay a year-end dividend of 39 yen per share for the fiscal year ended March 31, 2023,
3 yen more than the previous year-end dividend. Combined with the interim dividend of 39 yen per
share (3 yen more than the previous interim dividend), the annual dividend comes to 78 yen per share,
6 yen higher than the previous fiscal year’s annual dividend. For the fiscal year ending March 31, 2024,
Kurita Water Industries plans to pay an interim dividend of 42 yen per share and a year-end dividendof 42 yen per share, for an annual dividend to be 84 yen per share.
The dividend forecasts above are made by the Company based on information available at the timeof publication of this report. Actual results may differ from them due to a range of factors.
Basic Concept for the Selection of Accounting Standards
The Kurita Group voluntarily applied IFRS from the first quarter of the fiscal year ended March 31,
2020 for its consolidated financial statements for the purpose of increasing the international
comparability of financial information and unifying accounting treatment within the Group.

6

Consolidated financial statements(1) Consolidated statement of financial position(Million yen)
As of March 31, 2022

As of March 31, 2023

AssetsCurrent assets
Cash and cash equivalents

45,73050,468Trade and other receivables

108,892

120,299

Other financial assets

3,075

3,357

Inventories

13,132

16,847

Other current assets

7,564

5,444

Total current assets

178,396

196,416

Property, plant and equipment

161,034

178,737

Right-of-use assets

19,042

21,928Goodwill

62,99260,413

Intangible assets

18,092

17,104Non-current assets

Investments accounted for using equity method

1,191

1,283

Other financial assets

23,011

15,433

Deferred tax assets

6,071

9,984

Other non-current assets

150

235

Total non-current assets

291,585

305,121469,981

501,538

Total assets

7

(Million yen)
As of March 31, 2022

As of March 31, 2023

Liabilities and equity
Liabilities
Current liabilities
Trade and other payables

57,96751,465

Bonds and borrowings

8,180

28,998

Lease liabilities

4,683

4,294

Other financial liabilities

19,613

3

Income taxes payable

8,663

6,018

Provisions

1,529

2,301

Other current liabilities

13,28916,387

Total current liabilities

113,927

109,468

Bonds and borrowings

30,95348,758

Lease liabilities

14,86218,016

Other financial liabilities

1,757

1,666

Net defined benefit liability

18,144

17,321

Provisions

2,335

2,613

Deferred tax liabilities

2,646

2,362

Other non-current liabilities

7,491

5,570

Total non-current liabilities

78,191

96,310

192,119

205,778

Share capital

13,45013,450Capital surplus(3,076)(608)

Treasury shares(10,694)(10,638)

Other components of equity

12,161

14,132Retained earnings

260,073

277,639

271,914

293,975

Non-current liabilities

Total liabilities
EquityEquity attributable to owners of parent

5,948

1,784

Total equity

Non-controlling interests

277,862

295,759

Total liabilities and equity

469,981

501,5388

(2) Consolidated statement of profit or loss and comprehensive income
Consolidated statement of profit or loss
(Million yen)
Year ended March 31, 2022

Year ended March 31, 2023

288,207344,608

183,928

224,911104,278

119,696

Selling, general and administrative expenses

71,334

81,106

Other income

6,119

1,564

Net sales
Cost of sales
Gross profit

Other expenses

3,329

11,095

Operating profit

35,73429,058Finance income

601

1,990

Finance costs

6,176

1,077

(80)

179

Share of profit (loss) of investments accounted for using
equity method
Profit before tax

30,07930,151

Income tax expense

10,454

9,473

Profit for the period

19,624

20,677

Owners of parent

18,471

20,134Non-controlling interests

1,153

543

19,624

20,677164.38179.14‒‒

Profit attributable toProfit for the period
Earnings per share
Basic earnings per share (yen)Diluted earnings per share (yen)9Consolidated statement of comprehensive income(Million yen)
Year ended March 31, 2022

Year ended March 31, 2023

19,624

20,677

Net change in the fair value of financial assets
measured at fair value through other comprehensive
income520

674

Remeasurements of defined benefit plans

417

830

938

1,505

8,692

5,245

Cash flow hedges

131

182

Share of other comprehensive income of investments
accounted for using equity method

121

2Total of items that may be reclassified to profit or loss

8,944

5,429

9,883

6,935

29,507

27,61227,501

26,176

Profit for the period
Other comprehensive income
Items that will not be reclassified to profit or loss

Total of items that will not be reclassified to profit orloss
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign
operations

Other comprehensive income, net of tax
Comprehensive income for the period
Comprehensive income attributable to
Owners of parent
Non-controlling interests
Comprehensive income for the period

2,005

1,436

29,507

27,61210

(3) Consolidated statement of changes in equity
Fiscal year ended March 31, 2022 (April 1, 2021 - March 31, 2022)(Million yen)
Equity attributable to owners of parent
Other components of equity

Share capital

Balance as of April 1, 2021

Capital surplus Treasury shares

Exchangedifferences ontranslation offoreign
operations

Financial assets
measured at fairvalue throughothercomprehensive
incomeCash flow
hedges13,450(2,212)(10,787)(4,469)(91)

Profit for the period

‒

‒

‒

‒

‒

‒

Other comprehensive income

‒

‒

‒

7,962

131

520

Total comprehensive income for the period

13,060

‒

‒

‒

7,962

131

520

Purchase of treasury shares

‒

‒

(5)

‒

‒

‒

Dividends

‒

‒

‒

‒

‒

‒

Share-based payment transactions

‒

57

98

‒

‒

‒

Changes in ownership interests in subsidiaries‒(1,115)

‒

‒

‒

‒

Increase (decrease) by business combination

‒

‒

‒

‒

‒

‒

Liabilities pertaining to forward contracts
concluded with non-controlling shareholders

‒

‒

‒

‒

‒

‒

Transfer from other components of equity toretained earnings

‒

‒

‒

‒

‒

(4,954)

Other

‒

193

‒

‒

‒

‒

‒

(864)

93

‒

‒

(4,954)

13,450(3,076)(10,694)

3,493

40

8,627

Total transactions with owners
Balance as of March 31, 2022

(Million yen)
Equity attributable to owners of parent
Other components of equity
Remeasurementsof defined
benefit plans

Retainedearnings

Total

Non-controllinginterests

Total

Total

Balance as of April 1, 2021

‒

8,500

244,138

253,089

4,748

257,837

Profit for the period‒‒

18,471

18,471

1,153

19,624

415

9,030

‒

9,030

852

9,883

415

9,030

18,471

27,501

2,005

29,507Purchase of treasury shares

‒

‒

‒

(5)

‒

(5)

Dividends‒‒(7,865)(7,865)(943)(8,809)

Share-based payment transactions

‒

‒

‒

155

23

179

Changes in ownership interests in subsidiaries

‒

‒

‒

(1,115)(268)(1,384)

Increase (decrease) by business combination

‒

‒

‒

‒

357

357

Liabilities pertaining to forward contracts
concluded with non-controlling shareholders

‒

‒

‒

‒

‒

‒

Transfer from other components of equity toretained earnings(415)(5,369)

5,369

‒

‒

‒

Other comprehensive income
Total comprehensive income for the period

Other
Total transactions with owners
Balance as of March 31, 2022

‒

‒

(41)

152

26

179

(415)

(5,369)(2,536)(8,677)(805)(9,483)‒

12,161

260,073

271,914

5,948

277,86211

Fiscal year ended March 31, 2023 (April 1, 2022 - March 31, 2023)(Million yen)
Equity attributable to owners of parent
Other components of equity

Share capital

Balance as of April 1, 2022

Capital surplus Treasury shares

Exchangedifferences ontranslation offoreign
operations

Cash flow
hedgesFinancial assets
measured at fairvalue throughothercomprehensive
income8,627

13,450(3,076)(10,694)

3,493

40

Profit for the period

‒

‒

‒

‒

‒

‒

Other comprehensive income

‒

‒

‒

4,354

182

674

Total comprehensive income for the period

‒

‒

‒

4,354

182

674

Purchase of treasury shares

‒

‒

(2)

‒

‒

‒

Dividends

‒

‒

‒

‒

‒

‒

Share-based payment transactions

‒

76

58

‒

‒

‒

Changes in ownership interests in subsidiaries‒(19,793)

‒

1,830

‒

‒

Increase (decrease) by business combination

‒

‒

‒

‒

‒

‒

Liabilities pertaining to forward contracts
concluded with non-controlling shareholders‒

22,051‒‒‒‒

Transfer from other components of equity toretained earnings

‒

‒

‒

‒

‒

(5,070)

Other

‒

132

‒

‒

‒

‒

‒

2,467

55

1,830

‒

(5,070)13,450(608)(10,638)

9,678

222

4,231

Total transactions with owners
Balance as of March 31, 2023

(Million yen)
Equity attributable to owners of parent
Other components of equity
Remeasurementsof defined
benefit plans

Retainedearnings

Total

Non-controllinginterests

Total

Total

Balance as of April 1, 2022‒

12,161

260,073

271,914

5,948

277,862

Profit for the period‒‒

20,134

20,134543

20,677

830

6,041

‒

6,041

893

6,935

830

6,041

20,134

26,176

1,436

27,612

Purchase of treasury shares

‒

‒

‒

(2)

‒

(2)

Dividends‒‒(8,429)(8,429)(280)(8,709)

Share-based payment transactions

‒

‒

‒

135

(31)

103

Changes in ownership interests in subsidiaries

‒

1,830

‒

(17,962)(5,289)(23,251)

Increase (decrease) by business combination

‒

‒

‒

‒

‒

‒

Liabilities pertaining to forward contracts
concluded with non-controlling shareholders

‒

‒

‒

22,051‒22,051

Transfer from other components of equity toretained earnings(830)(5,901)

5,901

‒

‒

‒

Other comprehensive income
Total comprehensive income for the period

Other
Total transactions with owners
Balance as of March 31, 2023

‒

‒

(39)

92

‒

92

(830)

(4,070)(2,567)(4,115)(5,600)(9,715)‒

14,132

277,639

293,975

1,784

295,75912

(4) Consolidated statement of cash flows(Million yen)
Year ended March 31, 2022

Year ended March 31, 2023

Profit before tax

30,07930,151

Depreciation, amortization and impairment loss

24,44037,276

80(179)

Cash flows from operating activities

Share of loss (profit) of investments accounted for using
equity method
Loss (gain) on sale of fixed assets(4,073)76

Decrease (increase) in inventories(1,918)(3,109)Decrease (increase) in trade and other receivables(6,713)(10,172)

Increase (decrease) in trade and other payables

1,459

7,965

Other

(1,857)3,365

41,49765,373

Interest received

177

301

Dividends received

601

442

SubtotalInterest paid

(232)

(392)

(13,308)(17,094)

28,737

48,631

Payments into time deposits(2,348)(4,871)

Proceeds from withdrawal of time deposits

2,175

4,902

Purchase of property, plant and equipment

Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities(55,096)(53,384)

Proceeds from sale of property, plant and equipment

8,743

265

Purchase of intangible assets(2,038)(1,601)

Proceeds from sale of investment securities

9,197

8,854

Payments for acquisition of subsidiaries (after deductionof cash and cash equivalents included in acquired assets)(2,401)

‒

Other

1,839

(439)

(39,929)(46,274)

7,577

18,722

Proceeds from issuance of bonds

‒

9,955

Proceeds from long-term borrowings

58

9,988

Net cash provided by (used in) investing activities
Cash flows from financing activities
Net increase (decrease) in short-term borrowings andcommercial paper

Repayments of long-term borrowings

(485)

(499)

Repayments of lease liabilities(5,005)(5,170)

Dividends paid

(8,797)(8,699)Purchase of shares of subsidiaries not resulting in change
in scope of consolidation(1,440)(23,272)165

76(7,927)

1,101

Effect of exchange rate changes on cash and cash
equivalents

2,622

1,278

Net increase (decrease) in cash and cash equivalents(16,497)

4,737

Cash and cash equivalents at beginning of period

62,22845,730Cash and cash equivalents at end of period

45,73050,468Other
Net cash provided by (used in) financing activities

13

Notes to Consolidated Financial Statements(Notes on the Going-concern Assumption)
Not applicable(Segment Information)(1) Overview of reportable segments
The Company’s reportable segments are components of the Group about which separate financial information is available. Thesesegments are subject to periodic review to enable the Company’s board of directors to decide how to allocate resources and assess
performance.
The Group plans comprehensive strategies for the products that it handles in Japan and overseas, and develops a business. The Group’s
operations are therefore classified into two reportable segments, the Water Treatment Chemicals segment and the Water Treatment
Facilities segment.
The Water Treatment Chemicals segment manufactures and sells water treatment chemicals and equipment and provides maintenanceservices. The Water Treatment Facilities segment manufactures and sells water treatment system and facilities, supplies ultrapure water,
chemical cleaning, precision tool cleaning, soil and groundwater remediation services, and provides maintenance services thatencompass operation, maintenance, and management of water treatment facilities.
(2) Information of reportable segments
Inter-segment net sales are based on prevailing market prices.
Fiscal year ended March 31, 2022 (April 1, 2021 - March 31, 2022)(Million yen)
Reportable Segments

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

Adjustments(note)

Amounts
reported on the
consolidated
financialstatements

Water
Treatment
Chemicals

Water
Treatment
Facilities

Total

117,672518

170,534
561

288,207
1,080‒(1,080)288,207‒

118,191

171,095

289,287(1,080)288,207

14,56021,16935,729435,734

Finance income

601

Finance costs

6,176

Share of profit (loss) of investments accounted for using equity method(80)

Profit before tax

30,079(Million yen)
Reportable Segments

Segment assets
Other amounts
Depreciation and amortization
Impairment loss
Investments accounted for using equity
methodCapital expenditures

Adjustments(note)

Amounts
reported on the
consolidated
financialstatements

Water
Treatment
Chemicals

Water
Treatment
Facilities

Total

148,267

274,119422,386

47,595469,9815,935
380

17,477647

23,412
1,028‒‒

23,412
1,028

988

163

1,152

39

1,191

11,45457,016

68,471‒

68,471(Notes) 1. Segment income: Amount resulting from eliminations of inter-segment transactions.
2. Segment income is shown at the operating profit level.
3. Segment assets: Amount resulting from eliminations of inter-segment transactions.
The main factor of adjustments for segment assets is company-wide assets that are not allocated to the reportable segments.
4. Capital expenditures include an increase in right-of-use assets.
5. Capital expenditures do not include assets acquired through corporate acquisitions.

14Fiscal year ended March 31, 2023 (April 1, 2022 - March 31, 2023)(Million yen)
Reportable Segments

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

Adjustments(note)

Amounts
reported on the
consolidated
financialstatements

Water
Treatment
Chemicals

Water
Treatment
Facilities

Total

136,139553

208,468882

344,608
1,435‒(1,435)

344,608‒

136,692

209,350

346,043(1,435)

344,608

7,606

21,52629,132(73)

29,058Finance income

1,990

Finance costs

1,077

Share of profit (loss) of investments accounted for using equity method

179

Profit before tax

30,151(Million yen)
Reportable Segments

Segment assets
Other amounts
Depreciation and amortization
Impairment loss
Investments accounted for using equity
methodCapital expenditures

Adjustments(note)

Amounts
reported on the
consolidated
financialstatements

Water
Treatment
Chemicals

Water
Treatment
Facilities

Total

144,467

303,233

447,701

53,836

501,538

6,730
7,660

22,884‒29,614
7,660‒‒

29,614
7,660

1,085

149

1,234

49

1,283

6,773

41,46848,241‒

48,241(Notes) 1. Segment income: Amount resulting from eliminations of inter-segment transactions.
2. Segment income is shown at the operating profit level.
3. Segment assets: Amount resulting from eliminations of inter-segment transactions.
The main factor of adjustments for segment assets is company-wide assets that are not allocated to the reportable segments.
4. Capital expenditures include an increase in right-of-use assets.
5. The main factor of impairment loss is a loss on goodwill impairment of 7,646 million yen. For details, refer to (Consolidated
Statement of Profit or Loss: Other expenses).
(3) Information related to products and services
Information about products and services is omitted because the classifications are the same as the reportable segments.

15

(4) Information related to geographic regions
Non-current assets and sales to external customers by geographic region in each fiscal year are as follows.
(i) Non-current assets(Million yen)
As of March 31, 2022
Japan
Asia
North & South America
EMEA
Total

As of March 31, 2023

159,264
19,45061,74020,855

175,610
20,33060,74921,679261,311

278,370(Note) Non-current assets are allocated based on the location of assets. Financial instruments or deferred tax assets are not included.
EMEA stands for Europe, the Middle East and Africa.
(ii) Net sales(Million yen)
Year ended March 31, 2022
Japan
Asia
North & South America
EMEA
Total

Year ended March 31, 2023

159,365
58,032
46,351
24,457

175,995
78,88360,19829,530288,207344,608(Note) Net sales are allocated to a country or areas based on the locations of customers.
EMEA stands for Europe, the Middle East and Africa.
(5) Information related to major customers
Because there is no single external customer that accounts for 10% or more of the net sales in the consolidated statement of income,no information is stated here.

16

(Bonds and borrowings)(1) Bonds
Fiscal year ended March 31, 2022 (April 1, 2021 - March 31, 2022)
No bonds were issued or redeemed.
Fiscal year ended March 31, 2023 (April 1, 2022 - March 31, 2023)
The bonds issued are described below.
Name

Issue

Issue date

Total amount issued(million yen)Interest rate(%)

Redemption period

The Company

Second series of
unsecured bonds

May 26, 2022

10,0000.29

May 26, 2027

No bonds were redeemed.
(2) Borrowings
Fiscal year ended March 31, 2022 (April 1, 2021 - March 31, 2022)
Information is omitted because there were no important borrowings.
Fiscal year ended March 31, 2023 (April 1, 2022 - March 31, 2023)
The Group borrowed a total of 10,000 million yen (the final repayment date is December 29, 2027, even repayments) in the third
quarter of the fiscal year.

(Per Share Information)
The basis for calculation of basic earnings per share is as shown below.
(Million yen)
Year ended March 31, 2022
Profit attributable to owners of parent

18,471

20,134‒‒

Amount not attributed to common stockholders
Profit that is used for calculating basic earnings per share
Average number of common shares outstanding

Year ended March 31, 2023

18,471

20,134112,368,155

112,394,378(Notes) 1. Because there are no dilutive shares, diluted earnings per share are not stated.
2. The Company’s own shares posted as treasury shares remaining in trust are included in the treasury shares that are deductedin the calculation of the average number of shares outstanding for calculation for basic earnings per share (244,000 sharesin the fiscal year ended March 31, 2023, 253,000 shares in the fiscal year ended March 31, 2022).

(Consolidated Statement of Profit or Loss)(Other expenses)
A goodwill impairment loss of 7,646 million yen was posted in the Water Treatment Chemicals business of Kurita America, Inc. inother expenses in the fourth quarter of the fiscal year. The impairment loss is calculated by comparing the value in use and theaccounting book value. The value in use is calculated by discounting expected future cash flows using an appropriate discount rate.
The discount rate was raised to 10.8% (9.5% a year ago), chiefly reflecting policy interest rate hikes in the United States. The businessplan, the basis of an estimate of future cash flows, was carefully estimated and revised downward, considering changes in the water
treatment chemicals market in the United States following the outbreak of COVID-19 and results during the fiscal year, which wereaffected by disruptions to logistics and rising prices, as well as results in previous fiscal years. As a result, the value in use was lessthan the accounting book value, and an impairment loss is recognized.

(Finance Income)In the first quarter of the fiscal year, a gain on derivatives transactions of 1,090 million yen was recorded in finance income. This isincome from a foreign exchange contract that the Company entered into after deciding to underwrite a capital increase in Kurita
America Holdings Inc.

17

(Significant Subsequent Events)(Acquisition of shares in companies to make them subsidiaries)
At a meeting of the Board of Directors held on April 27, 2023, the Company resolved to acquire all issued shares in European
companies manufacturing and selling water treatment facilities, namely, Arcade Engineering GmbH (“Arcade Germany”), Arcade
Industrie SAS (“Arcade France”), and Arcade Engineering AG (“Arcade Switzerland”) through Kurita Europe GmbH, a consolidated
subsidiary of the Company, and make them subsidiaries. Kurita Europe GmbH concluded a share purchase agreement to acquire theissued shares on May 2, 2023. As a result of the acquisition of shares in Arcade Germany and Arcade Switzerland, Kurita will alsoacquire the shares of Arcade Engineering (Asia) Pte. Ltd. (“Arcade Asia”), a subsidiary of the two companies.
(1) Name, address, representative, capital and business of the company whose shares the Company will acquire(i) Acquired company:
Address:

Arcade Engineering GmbH
Meißner Str. 151a, 01445 Radebeul, Germany

Representative name:
Dr. Claudia Kaiser
Amount of share capital: 25,000 euros
Business description:(ii) Acquired company:
Address:
Representative name:

Design/engineering, construction management, and the provision of consulting services on water
treatment facilities
Arcade Industrie SAS
Aire de la Thur - 68840 Pulversheim, France
Ms. Claudine Muller

Amount of share capital: 40,000 euros
Business description:
Design/engineering and manufacture of electric equipment for water treatment facilities(iii) Acquired company:
Address:
Representative name:Arcade Engineering AG
Hegenheimermattweg 65, 4123 Allschwil, Switzerland
Mr. Felix GrischAmount of share capital: 100,000 Swiss francs
Business description:
Design/engineering of, and provision of consulting services on, water treatment facilities(vi) Acquired company:
Address:
Representative name:Arcade Engineering (Asia) Pte. Ltd.
280 Woodlands Industrial Park E5 #10-16, Singapore
Mr. Frederic Schindler

Amount of share capital: 100,000 Singapore dollars
Business description:
Design/engineering, construction management, and the provision of consulting services on water
treatment facilities(2) Purpose of the acquisition of shares
To operate globally in the electronics industry, a key market, the Kurita Group will acquire local manufacturing bases and a supply
chain for its water treatment facilities business, targeting the electronics industry in Europe. Kurita will build a business foundation
for responding promptly to the growth in demand for water treatment facilities intended for the electronics industry, which partly
reflects the European Chips Act, thus driving business expansion to the electronics industry in Europe. Further, Kurita will combine
products, technologies, and business models of the Kurita Group, including Kurita Europe GmbH and Kurita (Singapore) Pte. Ltd.,a subsidiary of Kurita, with the solution capabilities of Arcade Germany, Arcade France, Arcade Switzerland, and Arcade Asia, in its
efforts to enhance solutions which contribute greatly to saving water, cutting CO 2 emissions, and reducing waste.
(3) Date of share acquisition
July 3, 2023 (plan)18

(4) Number of shares to be acquired, acquisition value and shareholding ratio after acquisition(i) Arcade Engineering GmbH
Number of shares to be acquired:
Acquisition value:

3 shares16,500,000 euros

Shareholding ratio after acquisition: 100%(ii) Arcade Industrie SAS
Number of shares to be acquired:

2,000 shares

Acquisition value:2,500,000 euros
Shareholding ratio after acquisition: 100%(iii) Arcade Engineering AG
Number of shares to be acquired:
Acquisition value:

200 shares
6,000,000 euros

Shareholding ratio after acquisition: 100%(vi) Arcade Engineering (Asia) Pte. Ltd.
Number of shares to be acquired:
100,000 shares
Acquisition value:‒ (The acquisition value is included in the acquisition value in (i) and (iii) above.)
Shareholding ratio after acquisition: 100%(5) Fund procurement method and payment method
The Company’s own funds(Additional Information)(Acquisition of additional shares in a subsidiary)
The forward contract on a share transfer concluded between Kurita America Holdings Inc. and the non-controlling shareholders ofPentagon Technologies Group, Inc. was implemented on June 30, 2022, and Kurita America Holdings acquired an additional 49%
stake in Pentagon Technologies Group Inc. As a result, Pentagon Technologies Group Inc. has become a wholly owned subsidiary of
the Group.
The value of additional shares acquired was 161 million US dollars (22,127 million yen). The amount is posted under the purchase ofshares of subsidiaries not resulting in change in scope of consolidation in cash flows from financing activities in the consolidated
statement of cash flows. In connection with the posting of purchase of shares of subsidiaries, liabilities related to the forward contractconcluded with the non-controlling shareholders posted as financial liabilities of 19,613 million yen at the end of the previous fiscal
year was eliminated, non-controlling interests declined 4,615 million yen, and the capital surplus increased 2,743 million yen.

Disclaimer- This document is an English translation of the Earnings Report for the Fiscal Year Ended March 31, 2023 as reference information
primarily for overseas investors. If there are any discrepancies between the Japanese version and the English version, the Japaneseversion shall take precedence in all cases.
- This document is not subject to audit.
- The forward-looking statements such as performance forecasts contained in this document are based on information currently
available to the Company and certain assumptions deemed to be reasonable, and are not intended to be a commitment by the Company.
Actual performance, etc. may differ due to a variety of factors. See “Outlook for Overall Business, Including Production, Sales, andProfits and Losses” on page 4 of this document for the conditions assumed in the performance forecasts and the precautions concerning
the use of performance forecasts.

19