Summary of the Q&A Session
Financial Results Conference Call for 3Q of the Fiscal Year Ending March 31, 2022

Date and Time: February 1 (Tue.) 11:00 - 12:10

Notice: This summary is a reference designed for the convenience of those who could notattend the financial results conference call stated above. Please note that this is not aword-for-word transcript of all remarks made at that session, but is a summary prepared by
Kurita Water Industries Ltd.

Q. Please discuss the impact of surging raw materials prices and initiatives to raise selling prices
for the Water Treatment Chemicals segment by region.
A. Europe and ASEAN responded swiftly to the pandemic, already negotiating price hikes orproposing alternative products to customers in response to rising raw materials prices in thelast fiscal year. Selling price initiatives had been largely completed prior to 3Q but with raw
materials prices for phosphorus and polymers rising further, there was some impact in 3Q.
Additional price hikes are being implemented from 4Q onward.
We initiated price hikes from 2H in the domestic business, so higher raw materials prices did
have an effect in 3Q. That said, customers have been agreeing to price hikes, so we would
expect to see the impact of price measures materialize by early in the next fiscal year at thelatest. Progress with price hikes in South Korea and China are halfway between
Europe/ASEAN and Japan.
For the US, on top of significantly higher raw materials prices, the effect was compoundedby supply chain disruption and increased transportation costs from the beginning of thecurrent fiscal year. As a result, we were unable to fully capture demand in 1H. That said, there
was a recovery in demand in 3Q and supply chain disruption is gradually easing. While theimpact of higher raw materials prices will persist, the key will be success in negotiating pricehikes with customers renewing annual contracts into the new fiscal year. We note that theimpact on Avista Technologies was limited, reflecting Avista's high competitiveness whichmakes it possible to raise prices at any time.
Our overall impression is that the impact of rising raw materials prices was larger than had
been factored into our previous forecast. However, rather than simply focusing on price hikes,
we aim to take a broad-based, multi-pronged approach, including the consolidation of productspecifications, proposals of alternative products to customers, or reductions in delivery
frequency.

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Q. If we exclude the expenses related to the new R&D sites, I believe that the true 4Q businessprofit margin for the Water Treatment Facilities segment would be higher than your forecast.
While SG&A is likely to rise in the next fiscal year, given expectations for an improved mix
what is your view of the profitability of this segment in the FY ending March 2022?
A. Over the four years to this point of the MVP-22 Plan, we have focused on developing service
businesses, shifting to focus our business model on value. Ahead of the next fiscal year,
which will be the final year of our Medium-term Management Plan, we are in the process ofdeveloping many contract-type service businesses separate from the Ultrapure Water Supply(UPWS) business to drive a dramatic improvement in profitability. The forecast for thebusiness profit margin is just slightly below 12% this fiscal year. As we aim to achieve nextfiscal year's target of 15%, I believe that the combination of improvements in mix and successin capturing business in the electronics industry, a growth market, should lead to higher
profitability than this fiscal year.
Q. Capex plans for the electronics industry in 2022 remain at high levels. Please talk about theoutlook for Kurita's operating environment in East Asia.
A. We have seen an unprecedentedly strong capex appetite from the electronics industry since
the beginning of this fiscal year. Our focus to date in China has been FPD andsemiconductors, but near term capex for FPD is mainly capacity expansions for existing
plants. Going forward, we expect growth will be largely concentrated on semiconductors.
We will concentrate on successfully capturing capex projects from customers with whom wehave strong relationships in South Korea and Taiwan. On the domestic side, we have hadsolid success with customers where we have longstanding relationships. By also focusing on
wins from non-leading edge customers with proposals for non-EPC unit-type pure watersupply services and others, we hope to achieve stronger growth compared to this fiscal year.
Q. You indicated that there were delays on some projects in the Water Treatment Facilities
business in China. Could you provide a little more color?
A. The delays are simply due to timing. Some projects that had been expected to completeduring the current fiscal year being pushed into next fiscal year. The underlying market issolid.
Q. I believe that the high 3Q business profit margin for the Water Treatment Facilities segment
is the result of growth in the electronics industry business. There was an increase in quarterlyoverseas maintenance sales in particular. Is this more a reflection of growth in conventional
maintenance as opposed to contract-type services business, which you are targeting underMVP-22?
A. Current growth is more the result of strong capacity utilization at our customers' plants, rather
than special factors. In addition to conventional maintenance, we have also been able torespond to customer needs for production capacity expansion and maintenance that can beachieved without stopping production lines.

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Q. The forecast for UPWS capex skews heavily to 2H. Will this level of investment continue into
the 1H of the next fiscal year?
A. I cannot comment specifically but I believe we can look forward to an environment conducive
to high levels of investment.
Q. In the presentation materials, you have highlighted the ability to lock in a large volume ofwater as an issue for the electronics industry. At a time when semiconductor and SPE makers
are increasing capex, are we getting close to the limits in terms of water volume? Or, is it thatyou will be proposing solutions that include waste water reclamation to customers in regions
where water is already in short supply?
A. There are many meanings behind the wording we have chosen. In locations where water isscarce or difficult to procure, the value of water reclamation technologies will rise. In
instances where it is not possible to build new capacity and the customer must expand
existing capacity, there will be demand to adopt KWSS (Kurita Water Supply service) or
upgrade facilities. The Kurita Group can offer many solutions to electronics industry
customers facing issues as a result of constraints related to location.
Q. I believe the margin for the electronics industry Water Treatment Facilities business is rising.
What are the factors contributing to the improved profitability?
A. One major trend has been the strong capex appetite of a broad range of customers insemiconductors and electronic components, which has allowed us to be selective. We havealso been able to raise the profitability of individual projects through our ability to combine awide variety of services for customers requiring immediate responses to the need to expand
capacity or address water scarcity.
Q. You have indicated you will expand the range of the domestic electronics industry toolcleaning business by leveraging Pentagon Technologies. Please talk about the current
progress and the timeline for seeing results.
A. The tool cleaning business concentrates on cleaning components of semiconductor and flat
panel display manufacturing equipment. However, SPE makers also need to clean new
equipment prior to installation at new lines at customers' fabs. The cleaning of new equipment
requires a high degree of technological expertise as well as certification by SPE makers.
Pentagon is already accredited and recognized for its technology. By having domestic Kuritec
Service leverage Pentagon's technology and expertise, we believe we can develop newchannels and customers. We expect to see results in the current or next fiscal year.
Q. Given the high business profit target of 15% set out in the MVP-22 plan, while the electronics
industry business is strong and price hikes in the Water Treatment Chemicals segment arelikely to lead to improved margins, the pace of improvements in the Water Treatment
Facilities business for domestic general industry is sluggish. How much of an improvement
are you expecting to see in the Water Treatment Facilities business for general industry
during the current Medium-term Management Plan?
A. Progress on the migration to contract-type service businesses in the Water Treatment
Facilities business for general industry has been limited, although we have been able to add
3 / 4operations/maintenance services to the EPC business. Also, when taking on the challenge
of developing new technologies and products in EPC, new issues, such as the time required
to establish technology and operation and maintenance know-how can emerge. As such,progress on improving profitability is slow. We are working on shifting away from an EPC
focus to a business model concentrated on operation/maintenance and services. However,it will be difficult to achieve a dramatic improvement in margins in the next fiscal year. We
would like to provide a more detailed image of our vision for improving margins in the next
Medium-term Management Plan.
Q. Please provide the breakdown between electronics industry and general industry for the 20.3
billion yen full-year Water Treatment Facilities segment business profit forecast.
A. We do not disclose the sub-segment business profit breakdown but the contribution of theelectronics industry is high.
Q. Given the current challenging task of achieving a business profit margin of 15%, have youanalyzed what is the biggest shortfall versus your assumptions at the time the MVP-22 Plan
was formulated?
A. The first factor is the delay in ramping up the US subsidiary. Our scenario was to acquire abusiness base for the US through M&A, and to layer high value-added Kurita products andservices on top. We expected this would allow us to improve margins in a short period oftime. Aiming for a margin of close to 15%, we swiftly moved to integrate the subsidiaries andinitiate PMI. However, changes in the external operating environment including the pandemic
have revealed shortcomings in the ability to respond to change. Progress has been slow.
The second factor has been sluggish progress in the Water Treatment Facilities business forthe domestic general industry. Establishing new technologies and operations/maintenanceknow-how as well as developing new services in EPC and new fields, such as biomass, hasbeen slower than expected.
Q. Is your image for the next Medium-term Management Plan that you will be able to overcome
the current issues and be able to set a target higher than 15%?
A. If we can successfully address the two issues just discussed then I believe we can achievea business profit margin of more than 15%. I would like to set a margin target that inspires
pride in our employees in confirming our transition into a high-margin company.
Business forecasts presented and other statements relating to the future made in this document
are based on information currently available and certain assumptions the Company considers
reasonable. A variety of factors may cause actual financial results and other forward-looking
statements to differ materially from the forecasts.

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