Results Presentation for the Year Ended March 31, 2009

Kurita Water Industries Ltd.
( Stock code : 6370 )May 8, 2009

Table of Contents
Ⅰ. Consolidated Financial Results for the Fiscal Year Ended March 31, 2009

Ⅱ. Summary of medium-term management plan G-8 (Growth 2008)

Ⅲ. Overview of new medium-term management plan, MP-11 (Make Progress 2011)

Ⅳ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2010

Ⅴ. Reference Materials

Ⅰ. Consolidated Financial Results for the Fiscal Year Ended March 31, 2009

【 1 】 Financial Highlights【 2 】 Factors Behind Consolidated Financial Results【 3 】 Orders, Sales, Operating Income, and Operating Income Margin【 4 】 Water treatment chemicals【 5 】 Water treatment facilities (for the electronics industry)【 6 】 Water treatment facilities (for general industries)【 7 】 Financial Condition

Ⅰ. Consolidated Financial Results for the Fiscal Year Ended March 31, 2009
【1】 Financial Highlights(Billions of Yen)
03/2008

03/2009

Year-on-yearchangeRevisedprojection
issuedFeb. 26, 2009

Orders

208.7

195.1

- 6.5％

196.0

218.0

Net Sales

204.9

199.7

- 2.5％

200.0

213.0

OperatingIncome30.527.9- 8.3％

26.5

32.0

Ordinary
Income31.2

28.9- 7.4％

27.0

32.3

Net Income

18.3

16.3

- 10.9％

13.6

18.5

Initialprojection

1

Ⅰ. Consolidated Financial Results for the Fiscal Year Ended March 31, 2009
【2】 Factors Behind Consolidated Financial Results

Water Treatment Chemicals Business Marked drop in clients' factory operating rates from fiscal second half
 Greater-than-expected rise in raw materials prices

Water Treatment Facilities Business Sudden cooling of capital expenditure demand in electronics industries
 Decline in clients' factory operating rates in all industries
 Ultrapure water supply business expanded steadily2

Ⅰ. Consolidated Financial Results for the Fiscal Year Ended March 31, 2009
【3】 Orders, Sales, Operating Income, and Operating Income Margin
Water treatment chemicals

Water treatment facilities

Orders(Billions of Yen)
200

208.7
59.0

Sales
195.1

136.603/2008

03/200930.5
9.5

27.90(%)
17199.7

58.6

58.3

146.2

141.4

03/2008

03/200915

20.9

19.503/2008

03/2009

Operating Income Margin

16.2

8.4

150

204.9

100

149.7

Operating Income(Billions of Yen)
30

(Billions of Yen)
20058.5

1000Total

1314.914.303/2008

14.4
14.0
13.803/2009

3Ⅰ. Consolidated Financial Results for the Fiscal Year Ended March 31, 2009【4】 Water treatment chemicals
Orders and Sales
Orders

Sales

Operating Income and Operating Income Margin
Operating income(Billions of Yen)

(Billions of Yen)

60

10

Operating income margin(%)

1816.214.4

30059.0 58.6

58.5 58.303/2008

03/200959.5

98.400【Major areas of growth or decline】
 Growth: Domestic process treatment chemicals(steel, petroleum), wastewater treatment chemicals
 Decline: Domestic boiler water treatment chemicals,equipment

03/2008

03/2009【Major determinants of income decline】
 Rising raw materials prices
 Deteriorating product mix
 Increased SG&A expenses
4

Ⅰ. Consolidated Financial Results for the Fiscal Year Ended March 31, 2009【5】 Water treatment facilities (for the electronics industry)
Orders and Sales
Orders

Sales

Operating Income and Operating Income Margin
Operating income(Billions of Yen)

(Billions of Yen)

100

1818.6916.950088.1 91.2

73.7 77.6

Operating income margin

18.6

03/2009【Determinants of orders/sales growth or decline】
 Lower orders/sales for hardware, maintenanceservices, and tool cleaning services in Japan andoverseas
 Ultrapure water supply business expanded

20

1014.4003/2008(%)

003/2008

03/2009【Major determinants of income growth or decline】
 Decreased revenue from hardware, maintenanceservices, and tool cleaning services
 Revenue growth in the ultrapure water supplybusiness5

Ⅰ. Consolidated Financial Results for the Fiscal Year Ended March 31, 2009
【6】 Water treatment facilities (for general industries)
Orders and Sales
Orders

Sales

Operating Income and Operating Income MarginOperating income

Operating income margin(Billions of Yen)

(Billions of Yen)(%)

706107.3

350

61.5

55.1

62.9 63.7

8.0

53

5.1
4.00003/2008

03/2009【Major areas of orders growth】
 Electric power generation, maintenance services【Major areas of sales growth】
 Steel, electric power generation, soil remediation,maintenance services

03/2008

03/2009【Determinants of income growth】
 Increased revenue from hardware andimproved margins
6Ⅰ. Consolidated Financial Results for the Fiscal Year Ended March 31, 2009
【7】 Financial ConditionAssets

Liabilities and Net Assets(Billions of Yen)

245.4
231.5

27.1

( -7.2)

34.3

Cash, deposits
andMarketablesecurities

245.4
231.5
60.4

71.6
87.3

(Billions of Yen)

66.8

Liabilities( +6.3)

Other current
assets( -15.7)

126.1
82.0

Tangible
fixed assets

171.1

178.6

Net assets( +44.1)

27.9
Mar. 31, 2008

20.6( -7.3)
Mar. 31, 2009

Other fixedassets( +7.6)

Mar. 31, 2008

Mar. 31, 20097

Ⅱ. Summary of medium-term management plan G-8 (Growth 2008)【 1 】 Basic themes【 2 】 Performance targets and actual results【 3 】 Key strategies and results(1) Accelerate shift to service-based business model(2) Expand global business operations

Ⅱ. Summary of medium-term management plan G-8 (Growth 2008)【1】 Basic themes

GrowthGlobalGroup

Growth and Innovation
Bring about growth coupled with strong earnings power
Basic Policy“ We will promote innovation in the value we provide, and win the overwhelming
trust of our customers. ”

8

Ⅱ. Summary of medium-term management plan G-8 (Growth 2008)【2】 Performance targets and actual results

G-8(Billions of Yen)

03/2006

03/2007

03/2008

03/2009

G-8's initial
target for
03/2009

Net Sales

173.7

197.1

204.9

199.7

200.0

Operating
Income

17.3

24.3

30.5

27.9

27.0

Net Income

10.5

14.2

18.3

16.3

15.4

9

Ⅱ. Summary of medium-term management plan G-8 (Growth 2008)【3】 Key strategies and results(1) Accelerate shift to service-based business model【 Ultrapure Water Supply Business 】

Water treatment chemicals*

Water treatment facilities (services)

Total Cumulative Investment

Water treatment facilities (hardware)*(Billions of Yen)

denotes initial projectionsdenotes initial projections

111.4(Billions of Yen)
100

200.0 199.7

200173.7
63.0

50

58.3

54.5
79%

75%

45.5

23.7
003/2006

03/2009

80%
100

96.4

76.1

98.9

Sales
(Billions of Yen)
24

23.9

15.0

43.1
0

40.6

42.5

125.7
03/2006

03/2009

Service businesses' share of sales raised to 79%

003/2006

03/200910

Ⅱ. Summary of medium-term management plan G-8 (Growth 2008)【3】 Key strategies and results(2) Expand global business operations
Europe*denotes initial projections

N. America

Asia

Other

(Billions of Yen)

(Billions of Yen)

(Billions of Yen)(Billions of Yen)

42644

20.1 23.9

2.9 2.6

16.6
1.6 2.0

2

2.3

132

1.4 2.4

1.1003/2006

003/2009

03/2006

03/2009003/2006

03/200920

1.703/2006

03/2009

Sales by Overseas Business Segment

03/2006
Water
treatment
facilities

03/2009
Water
treatmentchemicals

6.8

26.0

21.8

14.9

15.0

31.0

11.0
11.0

20.0

12.5%

Proportion of net sales
from overseas businesses

13%11Ⅲ. Overview of new medium-term management plan, MP-11 (Make Progress 2011)【 1 】 Basic themes and medium-term vision【 2 】 Performance targets【 3 】 Key strategies(1) Expand and evolve service businesses(2) Expand global operations(3) Create and expand into new business areas(4) Bolster operating base【 4 】 Segment projections

Ⅲ. Overview of new medium-term management plan, MP-11 (Make Progress 2011)【1】 Basic themes and medium-term vision
Basic theme :Evolution and Progress

Expand andevolve service
businesses

Expand globaloperations
New value throughwater and newfunctionality for water

Bolster operating baseRisk management

Develop our people andpursue manufacturing
excellence
12Ⅲ. Overview of new medium-term management plan, MP-11 (Make Progress 2011)【2】 Performance targets(Billions of Yen)

03/2009

03/20123-year avg.
growth rateOrders

195.1

228.0+ 5.3%

Net Sales

199.7

224.0+ 3.9%

Operating Income

27.936.0+ 8.9%

Ordinary Income

28.9

36.3+ 7.9%

Net Income

16.3

20.6+ 8.1%

13

Ⅲ. Overview of new medium-term management plan, MP-11 (Make Progress 2011)【3】 Key strategies(1) Expand and evolve service businesses
Water treatment chemicals

Service Business Revenue

in装置事業中のサービス事業内訳
the Water Treatment Facilities Business

Water treatment facilities (services)
Water treatment facilities (hardware)(Billions of Yen)

240

224.0
199.7

116.0
(Billions of Yen)

58.3

13.1

1200

34.0
23.9

63.0

98.9

98.9

100

116.0

42.5

45.0

03/2009
Actual03/2012
Projection

14.5

Ultrapurewater supply
business
Tool cleaning

500

61.9

67.5

03/2009
Actual03/2012
Projection

Maintenance,etc.

 Solve clients' issues to help them boost productivity and reduce environmental burdens
 Evolve the Kurita Group's unique business model, as exemplified by the ultrapure watersupply business Create new value through water and new functionality for water
14Ⅲ. Overview of new medium-term management plan, MP-11 (Make Progress 2011)【3】 Key strategies(2) Expand global operationsz Water, food and energy shortages
z Spread of environmental pollution

Add new personnel,
particularly in China andSoutheast Asia
Sales by Region(Billions of Yen)

Develop globally competenthuman resources and bolster
organizational strengths
Sales by Overseas Business Segment

32.0

32

26.0
2.9
1.6
1.4

2.6
1.7
2.4

Water treatment chemicals
Water treatment facilities

OtherEurope

1625.3
20.1

N. America

14.9

26.0

12.511.0
19.5

32.0

Asia003/2009
Actual03/2012
Projection

03/2009
Actual03/2012
Projection15

Ⅲ. Overview of new medium-term management plan, MP-11 (Make Progress 2011)【3】 Key strategies(3) Create and expand into new business areas

Problems facing all of mankind

Food

Wa t e rEnergy

Business opportunities

New value through water and new functionality for water
Improve productivity

Reduce environmental
burdens16

Ⅲ. Overview of new medium-term management plan, MP-11 (Make Progress 2011)【3】 Key strategies(4) Bolster operating baseEnhance corporate value

Strengthen riskmanagement

Establish and strengthen
the Group's internalcontrols

Improve quality andproductivity, and develop
the human resources tosustain the improvements

17Ⅲ. Overview of new medium-term management plan, MP-11 (Make Progress 2011)【4】 Segment projections
Water treatment chemicals

Water treatment facilities

Orders(Billions of Yen)
240

Sales
228.0

195.1

(Billions of Yen)
240

224.0
199.7

63.0

58.3

58.5
12003/2009
Actual165.0(Billions of Yen)
3636.027.9003/2012
Projection

Operating Income(%)
17141.4

161.003/2009
Actual03/2012
Projection

Operating Income Margin
16.7
16.1
15.8

10.58.41518

19.50

63.0

120

136.60Total

03/2009
Actual

14.4
14.0
13.8

25.5

03/2012
Projection

1303/2009
Actual03/2012
Projection18

Ⅳ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2010
【 1 】 Key Assumptions【 2 】 Overview【 3 】 Orders, Sales, Operating Income, and Operating Income Margin【 4 】 Water treatment chemicals【 5 】 Water treatment facilities (for the electronics industry)【 6 】 Water treatment facilities (for general industries)【 7 】 Service Business Revenue【 8 】 Ultrapure Water Supply Business (Trends)【 9 】 Expand Ultrapure Water Supply Business【10】 Overseas Businesses【11】 Capital Expenditures, Depreciation, and R&D Expenses【12】 Dividend Policy

Ⅳ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2010
【1】 Key Assumptions

Water Treatment Chemicals Business Operating rates will decline in all industries throughout Japan Clients' strong need to boost productivity and tackle environmental issues
will continue
 Emerging economies' growth will falter Raw materials prices will decline

Water Treatment Facilities Business The ultrapure water supply business will expand Capital expenditure and operating rates will decline in all industries
throughout Japan The electronics industry will undergo restructuring

19

Ⅳ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2010
【2】 Overview(Billions of Yen)
03/2009
Actual03/2010
Projection

Year-on-yearchangeOrders

195.1

187.0

- 4.1%Net Sales

199.7

192.0

- 3.9%

Operating Income

27.9

26.0

- 6.9%

Ordinary Income

28.9

26.5

- 8.4%Net Income

16.3

15.0

- 8.0%

20

Ⅳ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2010
【3】 Orders, Sales, Operating Income, and Operating Income Margin
Water treatment chemicalsWater treatment facilities

Orders(Billions of Yen)
200

Sales

195.1

187.0

58.5

55.6

1000

136.6

131.403/2009
Actual03/2010
Projection

27.9
8.4

199.7

192.0

58.3

55.5

141.4

136.5003/2009
Actual03/2010
Projection

(%)
15

14.4

8.0
1419.503/2009
ActualOperating Income Margin

26.0

150

(Billions of Yen)
200

100

Operating Income(Billions of Yen)
30

Total

14.0
13.8

18.003/2010
Projection

14.4

13.5
1313.203/2009
Actual03/2010
Projection21

Ⅳ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2010
【4】 Water treatment chemicals
Orders and Sales
OrdersSales

Operating Income and Operating Income Margin
Operating income(Billions of Yen)

(Billions of Yen)

60

10300

58.5 58.303/2009
Actual55.6 55.503/2010
Projection【Major determinants of change】
 Decline in shipment volumes
 Growth in products that help enhance
productivity

Operating income margin
(%)

14.4

14.4

50

168

8.4

8.003/2009
Actual03/2010
Projection0【Major determinants of change】
 Lower revenue in Japan and overseas
 Lower cost prices
 Curbing of SG&A expenses
22

Ⅳ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2010
【5】 Water treatment facilities (for the electronics industry)
Orders and Sales
Orders

Sales

Operating Income and Operating Income Margin
Operating income(Billions of Yen)

(Billions of Yen)

801640073.7 77.6

73.0 74.603/2009
Actual03/2010
Projection【Major determinants of change】
 Declines in hardware in Japan and overseas andin tool cleaning services in Japan Growth in the ultrapure water supply business

80

Operating income margin

18.6

18.9

14.4

14.103/2009
Actual03/2010
Projection

(%)

20100

【Major determinants of change】
 Decline in revenue from hardware and toolcleaning services Revenue growth in the ultrapure watersupply business23

Ⅳ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2010
【6】 Water treatment facilities (for general industries)
Orders and Sales
Orders

Sales

Operating Income and Operating Income Margin
Operating income

Operating income margin(Billions of Yen)

(Billions of Yen)(%)

706108.0
6.3
35

62.9 63.7

58.4 61.9

535.1
3.9003/2009
Actual03/2010
Projection【Major determinants of change】
 Growth in maintenance services Decline in orders from / sales to thesteel industry

003/2009
Actual03/2010
Projection0【Major determinants of change】
 Decline in hardware

24

Ⅳ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2010
【7】 Service Business Revenue
Service Business Revenue
in the Water Treatment Facilities Business

Water treatment chemicals
Water treatment facilities (services)
Water treatment facilities (hardware)(Billions of Yen)

204.9

200

58.6

100

0

93.5

199.7
58.3

(Billions of Yen)

192.0

100

93.5

98.9

104.7
Ultrapurewater supply
business

16.8

23.9

31.0

14.4

13.1

11.5

Tool cleaning

62.3

61.9

62.2

Maintenance,etc.

03/2008
Actual03/2009
Actual03/2010Projection

55.5

50

98.9

104.7

52.8

42.5

31.8

03/2008
Actual03/2009
Actual03/2010
Projection0*The soil remediation business is included in "Maintenance, etc."25

Ⅳ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2010
【8】 Ultrapure Water Supply Business (Trends)【 to domestic large-scale LCD plants 】【 to domestic large-scale plasma display panel (PDP) plants 】【 to domestic large-scale LCD plants 】【 to domestic semiconductor plants 】【 to domestic wafer plants 】【 to domestic semiconductor plants 】【 to domestic large-scale LCD plants 】【 to LCD plants in Singapore 】

03/2002

03/2003

03/2004

03/2005

03/2006

03/2007

03/2008

03/2009

03/201026

Ⅳ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2010【9】 Expand Ultrapure Water Supply Business
Capital Expenditures andTotal Cumulative Investment

Capital expenditure(left axis)

Sales

Total cumulative investment(right axis)(Billions of Yen)

30

(Billions of Yen)

(Billions of Yen)

60

111.4

114.4

120

31.0

15
59.4

30

60

23.9

52.0

39.6

16.8

15.7

9.8

19.8
3.00
03/2007
Actual03/2008 03/2009 03/2010
ActualActual Projection0003/2007
Actual03/2008
Actual03/2009 03/2010
Actual Projection27

Ⅳ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2010【10】 Overseas Businesses
Sales by Region

Asia(Billions of Yen)

30

N. America

EuropeSales by Overseas Business Segment

Other

31.3
3.1
1.7
2.8

Water treatment chemicals(Billions of Yen)

Water treatment facilities

31.3

30

26.0
2.9
1.6
1.4

26.0
11.2

23.0
2.2
1.5
1.8

15

23.0
11.0
10.0

15

23.7
20.1003/2008
Actual03/2009
Actual20.1

17.503/2010
Projection

14.9003/2008
Actual03/2009
Actual13.003/2010Projection28

Ⅳ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2010【11】 Capital Expenditures, Depreciation, and R&D Expenses
Capital Expenditures and Depreciation

Capital expenditures(ultrapure watersupply business)

Capital expenditures(excl. ultrapurewater supply business)

R&D Expenses

Depreciation

55.7(Billions of Yen)

R&D Expenses

Percentage of net sales(Billions of Yen)

(%)

6450

4.6

52.0

25

3

23.3

4.4

4.4

2.2

2.2

2.3

03/2008
Actual03/2009
Actual2

19.80

3.5

8.503/2008
Actual10.9

5.5 14.0

3.7

3.02.503/2009
Actual03/2010
Projection003/2010
Projection029

Ⅳ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2010【12】 Dividend Policy
(Yen)

4032
28
20

22+43434+2±003/2009
Projection

03/2010
Projection+6+4003/2006
Actual03/2007
Actual03/2008
ActualBasic Dividend Policy
Kurita’s basic policy is to maintain stable dividends, and the company will work to increase
dividends while giving due consideration to trends in results and investments in its businesses.

30

Ⅴ. Reference Materials

Ⅴ. Reference Materials
Analysis of Changes in First-half Operating Income for the Fiscal Year Ending March 31, 2009

(Billions of Yen)

34

30.5

- 1.5- 0.04

+ 0.1

27.9

Rise in prices of chemical raw
materials due to crude oil priceinflation

170- 1.203/2008
Actual0000

Effect oflower
revenues*

Higher costof raw
materials

Higher
SG&A
expenses

Effect ofimproved costof sales ratio*

03/2009
Actual* Effects of lower revenues and improved cost of sales ratio are calculated using the gross profit margin.

31

Kurita Water Industries Ltd.
■ U R L ■http://www.kurita.jp/■ M A I L ■ir@kurita.co.jp

Forward-looking Statements
This presentation contains forward-looking statements, business plan projections, and judgments based on
information available to management at the time of writing. Due to the existence of a variety of risk factors
and uncertainties, actual results may differ from those specified or implied by these forward-looking
statements and projections.