FOR IMMEDIATE RELEASE
Kurita Water Industries Reports Earnings for the Six Months ended
September 30, 2012
Tokyo, Japan, October 31, 2012—Kurita Water Industries Ltd. (TSE Securities Code6370) announced net sales of 90,236 million yen and net income of 4,865 million yen,or 38.41 yen per share, for the six months ended September 30, 2012 (April 1, 2012 –September 30, 2012).

Results of Operations
Total consolidated orders for the Kurita Group in the six months ended September 30,
2012, decreased 4.4% versus the same period of the previous fiscal year to 94,070
million yen. Net sales rose 0.8% year on year to 90,236 million yen. In terms of income,
operating income declined 16.6% year on year to 10,854 million yen, while ordinary
income declined 15.3% to 11,335 million yen. Net income amounted to 4,865 million
yen, down 38.3%. In the second quarter, the company posted an extraordinary gain of
1,184 million yen mainly as a result of the sale of some ultrapure water supply businessfacilities, as well as extraordinary losses of 3,778 million yen, mainly due to an
impairment loss in relation to the relocation of the head office and a valuation loss on
investment securities.
Reviewing markets in which the Kurita Group operates, the business environment inJapan remained severe during the period. Although recovery from the Great East Japan
Earthquake progressed, capital investment was sluggish overall due to continued
consolidation of production sites within the manufacturing industry and the transfer ofmanufacturing operations overseas. Outside Japan, the protracted European debt crisis
impacted China and other emerging economies, leading to a slowdown in global
economic activity. In East Asia, for example, electronics firms have scaled back or
postponed major capital investments, as the sense of economic uncertainty intensified
during the six-month period.
Amid this environment, the Kurita Group strove to increase orders by further
bolstering teamwork within the Group in Japan and overseas and leveraging theGroup’s comprehensive capabilities through consultative sales to help customers withissues such as productivity enhancement and environmental mitigation.

Segment Information
Water Treatment Chemicals
Total Group orders for the Water Treatment Chemicals segment in the six-month period
totaled 28,694 million yen, down 1.1% versus the same period of the previous fiscal
year, while sales increased 0.2% to 28,674 million yen. Operating income declined
6.2% to 4,681 million yen.
In Japan, there was an increase in orders for and sales of process treatment chemicals
for the paper and pulp industries and treatment chemicals for waste incinerationequipment. On the other hand, there was a decline in orders for and sales of mainstay
cooling water treatment chemicals to customers in the electronics and petrochemicalindustries amid consolidation and halt in operations of manufacturing plants.
Additionally, there was a decline in orders for equipment and services which had shown
an increase in the same period last year as a result of strong post-earthquake recovery
demand.
1

Overseas, despite robust business in China, both orders and sales declined in Europe
due to the impact of the European debt crisis and ensuing economic slump.
Water Treatment Facilities
Total Group orders for the Water Treatment Facilities segment in the six-month periodamounted to 65,376 million yen, down 5.8% versus the same period of the previous
fiscal year. Sales increased 1.1% to 61,562 million yen, while operating income
declined 23.2% to 6,161 million yen.
In the electronics industry, orders and sales in the ultrapure water supply business werelargely unchanged compared to the same period of the previous fiscal year. Orders andsales of water treatment facilities and maintenance services declined, however, due tothe restructuring of manufacturing plants among major customers, lower capacity
utilization rates, and a decline in post-earthquake recovery-related demand. Overseas,
while some customers scaled back or postponed capital investments due to the global
economic slowdown, there was an increase in orders and sales to semiconductor and
LCD panel plants.
In general industries, orders declined mainly in the electric power industry and forsoil remediation due to the decline in earthquake recovery-related demand and sluggish
capital investment. Sales increased as progress on the construction of water treatment
facilities for the electric power industry as part of earthquake reconstruction efforts,
outweighed a decline in sales of soil remediation services.
Financial Condition
Current assets totaled 152,175 million yen at the end of the second quarter (September
30, 2012), an increase of 7,190 million yen versus the end of the previous fiscal year
(March 31, 2012). This was mainly a result of an increase of 19,000 million yen inmarketable securities, which outweighed declines of 7,085 million yen in trade accounts
receivable and 4,740 million yen in cash and deposits. The decline in trade accounts
receivable was the result of progress in collecting receivables since the end of theprevious fiscal year. The decline in cash and deposits and increase in marketablesecurities was mainly the result of increased investment in negotiable certificates, which
are treated as marketable securities.
Noncurrent assets totaled 116,520 million yen at the end of the six-month period(September 30, 2012), a decline of 9,636 million yen versus the end of the previous
fiscal year. The decline was mainly due to a 7,840 million yen decrease in property,
plant and equipment and 1,714 million yen decrease in investment securities. The
decline in property, plant and equipment was due to depreciation of ultrapure watersupply business facilities exceeding capital expenditures during the six months ended
September 30, 2012, as well as the sale of some ultrapure water supply businessfacilities. The decline in investment securities was due to a valuation loss booked inconjunction with a decline in market prices.
Current liabilities totaled 36,203 million yen at the end of the period, a decline of
6,155 million yen versus the end of the previous fiscal year. This was mainly a result of
declines of 3,269 million yen in income taxes payable and 2,578 million yen in tradeaccounts payable.
Noncurrent liabilities totaled 19,606 million yen at the end of the period, an increase of
825 million yen versus the end of the previous fiscal year.
Net assets totaled 212,884 million yen at the end of the period, an increase of 2,882
million yen versus the end of the previous fiscal year. The change mainly reflects a
2,324 million yen increase in retained earnings resulting from the posting of 4,865
million yen in net income, which exceeded the dividend payments of 2,533 million yen
at the end of the previous fiscal year.
2Cash Flows
Consolidated net cash and cash equivalents at the end of the six month-period underreview (September 30, 2012) totaled 12,562 million yen, a decrease of 7,263 million
versus the end of the previous fiscal year (March 31, 2012). The various cash flows andrelated factors are outlined below.
Cash flows from operating activities
Net cash provided by operating activities in the six months ended September 30, 2012
totaled 16,613 million yen, an increase of 1,631 million yen versus the same period of
the previous fiscal year. This primarily reflects a net inflow comprising income before
income taxes and minority interests of 8,741 million yen, 7,647 million yen in
depreciation and amortization, and a 7,577 million yen decrease in trade receivables,
which was partially offset by income taxes paid of 7,022 million yen and a decline of
3,108 million yen in trade account payables.
Cash flows from investing activities
Net cash used in investing activities was 20,585 million yen, an increase of 7,858
million yen versus the same period of the previous fiscal year. This primarily reflects a
net inflow from deposits into and withdrawals from time deposits of 5,968 million yen,
and an inflow of 3,342 million yen from the sale of some ultrapure water supply
business facilities offset by outflows including 27,500 million yen for the purchase andredemption of marketable securities and 1,973 million yen million for payments forpurchase of property, plant and equipment, mainly equipment for the ultrapure watersupply business.
Cash flows from financing activities
Net cash used in financing activities totaled 3,335 million yen, an increase of 493
million versus the same period of the previous fiscal year. The main cash outflow was
2,537 million in cash dividends paid.
Outlook for the Fiscal Year Ending March 31, 2013
The company has revised its outlook for the full year ending March 31, 2013 from thetargets disclosed in the April 27, 2012 financial results announcement. For further
details, please see the October 17, 2012 announcement, “Kurita Water Industries
Revises Earnings Forecast.”

Consolidated Earnings Forecast
Revision of consolidated earnings forecast for the full fiscal year ending March 31,
2013 (April 1, 2012 – March 31, 2013)
Net sales
Previous forecast (A)Revised forecast (B)Change (B – A)
Percent change
For reference:
Fiscal year ended
March 31, 2012(actual)200,000
196,000(4,000)(2.0)%
193,792

Operating
Ordinary
incomeincome(millions of yen)
29,50030,00025,00025,700(4,500)(4,300)(15.3)%(14.3)%
29,382
3

30,369Net
income17,50013,600(3,900)(22.3)%Net income
per share(yen)
138.17107.37——

16,548130.65Other Information(1) Accounting treatment specific to the preparation of quarterly consolidated financial
statementsa. Tax expense
The Company calculates tax expense by producing a reasonable estimate of theeffective tax rate after applying tax-effect accounting to income before income taxes
and minority interests for the fiscal year and then multiplying quarterly income before
income taxes and minority interests by this estimated effective tax rate.
(2) Changes in accounting policy, changes in accounting estimates, and retrospective
restatement
Changes in accounting policy hard to distinguish from changes in accounting estimates
In response to Japan's recent corporate tax law amendments and effective from the firstquarter of the fiscal year ending March 31, 2013, the method which Kurita Water
Industries Ltd. and its domestic consolidated subsidiaries use for depreciation of
noncurrent assets acquired on or after April 1, 2012 will be adjusted to reflect therevised corporate tax code. Impact on earnings for the six months ended September 30,
2012 is expected to be minimal.

4

Financial Statements — Consolidated
Balance Sheet — Consolidated

AssetsCurrent assets
Cash and deposits
Notes receivable - trade
Accounts receivable - tradeMarketable securities
Finished products
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings (net)
Machinery and equipment (net)Other (net)Total property, plant and equipment
Intangible fixed assets
Investments and other assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets

As ofMarch 31, 2012
Amount(millions of yen)
As of
September 30, 2012
Amount28,902
7,045
59,31140,500
1,598
2,715
1,209
3,761
(58)
144,985

24,162
6,612
52,22659,500
1,347
3,419
1,424
3,530
(47)
152,175

28,35544,77925,23398,368
1,683

25,26739,94425,317
90,528
1,782

26,443(339)
26,103
126,156
271,141

24,544(335)
24,209116,520
268,695

1,701
19,620
7,045
2,427
1,007
10,55542,3581,547
17,042
3,776
2,757
1,148
9,931
36,203

10,335
168
8,277
18,781
61,13910,576593
8,437
19,60655,81013,45011,426
196,541(9,642)
211,776

13,45011,426
198,865(9,643)214,099

Liabilities
Current liabilities
Notes payable – trade
Accounts payable - trade
Income taxes payable
Accrued employees’ bonuses
Other allowances
Other
Total current liabilities
Noncurrent liabilities
Accrued employees’ retirement benefits
Other allowances
Other
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders’ equity
Common stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
5

Accumulated other comprehensive income
Unrealized gains on available-for-sale securities
Unrealized gains (losses) on revaluation of land
Foreign currency translation adjustments
Total accumulated other comprehensive income
Minority interests
Total net assets
Total liabilities and net assets

6

252
(564)
(2,572)(2,884)
1,110
210,002271,141766(564)(2,563)(2,361)
1,147
212,884
268,695

Statements of Income and Comprehensive Income – Consolidated
Statement of Income

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Directors’ and corporate auditors’ compensations,salaries and allowances
Provision for bonuses
Research and development expenses
Other
Total selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Equity in earnings of unconsolidated subsidiaries
and affiliates
Other
Total non-operating income
Non-operating expenses
Interest expense
Other
Total non-operating expenses
Ordinary income
Extraordinary gains
Gain on sales of noncurrent assets
Gain on discontinuation of approved retirement
annuity system (closed-type)
Total extraordinary gains
Extraordinary losses
Impairment losses
Provision for building demolition expenses
Valuation loss on investment securities
Disaster losses
Disaster recovery expenses
Total extraordinary losses
Income before income taxes and minority interests
Income taxes
Income before minority interests
Minority interests in earnings of consolidated
subsidiaries
Net income

7(millions of yen)Six months ended Six months ended
September 30, 2011September 30, 2012
AmountAmount
89,51590,23658,22660,29431,28829,942
6,544

6,716

1,513
2,065
8,147
18,27013,017

1,527
2,183
8,660
19,08810,854

52
189

75
187

155

173

135
533

148
584

48
117
166
13,38448
54
103
11,335

-

1,046

-

137

-

1,184

17
17
35
13,3495,445
7,904(*1) 1,001(*2) 434
2,343
3,778
8,741
3,834
4,906

22

41

7,881

4,865

Statement of Comprehensive Income

Income before minority interests
Other comprehensive income
Unrealized gains on available-for-salesecurities
Foreign currency translation adjustments
Share of other comprehensive income ofassociates accounted for using equity method
Total other comprehensive income
Comprehensive income(Components)
Comprehensive income attributable to ownersof the parent company
Comprehensive income attributable tominority interests

8(millions of yen)Six months ended Six months ended
September 30, 2011 September 30, 2012
7,904
4,906
(1,211)

514

248

6

27

9

(935)
6,968

531
5,437

6,927

5,388

41

49

Statements of Cash Flows — Consolidated(millions of yen)

Cash flows from operating activities
Income before income taxes and minority interests
Depreciation and amortization
Increase (decrease) in allowances(Gains) losses on sale/disposal of property, plant andequipment
Impairment loss
Valuation (gain) loss on investment securities(Increase) decrease in notes and accounts receivable - trade(Increase) decrease in inventories
Increase (decrease) in notes and accounts payable - trade
Income taxes paid
Other
Net cash provided by (used in) operating activities
Cash flows from investing activities
Deposits into time deposit accounts
Withdrawals from time deposits
Payments for purchases of marketable securities
Proceeds from sale and redemption of marketable securities
Payments for purchases of property, plant and equipment
Proceeds from sale of property, plant and equipment
Payments for purchases of investment securities
Other payments
Other proceeds
Net cash provided by (used in) investing activities
Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Proceeds from long-term loans payable
Repayment of finance lease obligations
Purchase of treasury stock
Cash dividends paid
Cash dividends paid to minority shareholders
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the period
Increase in cash and cash equivalents from newly
consolidated subsidiaries
Cash and cash equivalents at the end of the period

9

Six months
ended
September 30,
2011
AmountSix months
ended
September 30,
2012
Amount13,349

8,741

7,904

7,647

271

603

7

(1,034)

-

1,001

7

2,343

1,047

7,577

(2,560)

(662)

434

(3,108)(5,817)(7,022)337

526

14,982

16,613(19,647)(12,224)

27,68918,192(39,000)(59,500)

21,00032,000(2,671)(1,973)

8

3,342

(6)

(6)

(319)

(508)

219

93

(12,727)(20,585)

(182)

(597)

2

57

(244)

(256)

(1)

(1)

(2,403)(2,525)

(13)

(12)

(2,842)(3,335)

47

44

(540)

(7,263)

10,834

19,825--

10,294

12,562

Notes on the Going-concern Assumption
Six months ended September 30, 2012 (April 1, 2012 – September 30, 2012)
Not applicable

Notes to Consolidated Financial Statements(Concerning quarterly consolidated statement of income)*1 Impairment loss
For the first six months of the fiscal year ending March 31, 2013 (April 1, 2012 –September 30, 2012)
The Group has booked an impairment loss for the following asset group.
Use
Category
Location
Impairment loss
Idle assets
Buildings andTokyo, Shinjuku
1,001 million yen
structures, etc.
Ward
The Company categorizes business assets by type of business structure, and leased
assets and idle assets by individual property type. In the first six months of the fiscal
year, though there were no indications of impairment to business assets or leased assets,land, buildings, and structures, etc. owned by the company in Tokyo, Shinjuku Wardbecame idle as a result of the relocation of the head office. Among these assets, thebook value of the buildings and structures, etc. was reduced to the residual value due toasset deterioration and the company’s recognition of its inability to recover book value.
In conjunction with this, the company booked an impairment loss of 1,001 million yen
as an extraordinary loss.
*2 Booking of provision for building demolition expenses
In the first six months of the fiscal year ending March 31, 2013, the company resolved
to demolish its former head office building (Tokyo, Shinjuku Ward). In conjunction
with the decision, the company has made a reasonable estimate of the cost and booked aprovision for building demolition expenses of 434 million yen as an extraordinary loss.

10

Segment Information
1. Sales and income/loss by reportable segment
Six months ended September 30, 2011 (April 1, 2011 – September 30, 2011)(millions of yen)
Reportable Segment

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

Water
Treatment
Chemicals

Water
Treatment
Facilities

Total

28,617
197
28,814
4,991

60,89892
60,991
8,027

89,515290
89,806
13,018Amounts reported
on the quarterly
statements of
Adjustments
income(note 1)
(note 2)
(290)
(290)
(0)

89,51589,51513,017Six months ended September 30, 2012 (April 1, 2012 – September 30, 2012)(millions of yen)
Reportable Segment
Water
Treatment
Chemicals

Water
Treatment
Facilities

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

Total
Sales
Sales to outside customers
28,67461,562
90,236
Inter-segment sales or transfers
144
97
242
(242)
(242)
Total
28,81861,66090,47811
Segment income
4,681
6,161
10,842
Notes:
1. Adjustments related to sales represents elimination of inter-segment sales. Resultant
adjustment of segment income is reflected in segment income Adjustments.
2. Segment income is shown at the operating income level.
2. Impairment loss on noncurrent assets by reportable segment
Impairment loss on idle noncurrent assets was recognized in the six months ended
September 30, 2012. This had no effect on each segment.

Notes on Significant Changes in Shareholders’ Equity
Six months ended September 30, 2012 (April 1, 2012 – September 30, 2012)
Not applicable11

90,236
90,236
10,854Other Information — Consolidated(1) Order Intake

Business segment
Water Treatment Chemicals
Water Treatment Facilities
Total(millions of yen)Six months ended September 30,
2011
2012
Amount%Amount%29,01829.5
28,69430.5
69,41870.5
65,376
69.5
98,436100.0
94,070100.0(2) Net Sales

Business segment
Water Treatment Chemicals
Water Treatment Facilities
Total(millions of yen)Six months ended September 30,
2011
2012
Amount%Amount
%28,61732.0
28,67431.8
60,89868.0
61,56268.2
89,515100.0
90,236100.0(3) Capital Expenditures (Property, Plant and Equipment)

Business segment
Water Treatment Chemicals
Water Treatment Facilities
Total(millions of yen)Six months ended September 30,
2011
2012
Amount%Amount
%
667
25.2
804
28.2
1,984
74.8
2,050
71.8
2,652
100.0
2,855
100.0

(4) Depreciation (Property, Plant and Equipment)

Business segment
Water Treatment Chemicals
Water Treatment Facilities
Total(millions of yen)Six months ended September 30,
2011
2012
Amount%Amount
%
563
7.4
529
7.2
7,015
92.6
6,832
92.8
7,579
100.0
7,361
100.0

12