Summary of the Q&A Session at the Briefing for Financial Results for theFiscal Year Ended March 2023 andMedium-Term Management Plan

Date and Time: May 12 (Fri.), 2023 10:00-11:30
Notice: This summary is a reference designed for the convenience of those who could not attend
the financial results briefing stated above. Please note that this is not a word-for-word transcript ofall remarks made at that session, but is a summary prepared by Kurita Water Industries Ltd.
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Please comment on the profit improvements outlined in the new Medium-Term ManagementPlan (hereafter PSV-27). When I look at the breakdown of the sales target, I felt the message
was that Kurita will focus on all areas where it can demonstrate its strength in creating socialvalue, rather than concentrating on the Electronics Industries. The strategy for the Electronics
Industries is to expand highly profitable businesses. For the General Industries, do you haveprofit targets and strategies along the lines of the previous business segmentation such as
chemicals and others?
For both the chemicals and other businesses, we aim to raise profitability primarily through thegrowth of the CSV (Creating Shared Value) business. We have numerous front line gemba
contact points in General Industries but the types of CSV solutions required vary by customer,industry and region. As a result, the key will be swiftly putting together approaches to deliver
optimal value for each customer, even when the underlying technologies are the same.
You have taken impairment losses on the goodwill for the Kurita America Inc. (hereafter KAI)
chemicals business but my understanding was that margins on KAI's facilities business arelower. Is there currently a risk of impairment losses for the facilities business as well?
We have posted impairment losses on goodwill for KAI's chemicals business as a result of U.S.
rate hikes and a thorough review of the business plan. The scale of the chemicals business islarger than the facilities business. In the facilities business, in addition to pursuing public sector
and general industry demand, we will also undertake initiatives in the electronics industry.
Currently, we believe the risk of impairment losses for the facilities business is low.
Please share with us the challenges facing KAI's chemicals business and your strategy for thefuture.
KAI, which is the result of integrating 3 subsidiaries in North America, fell short of ourexpectations for progress on PMI owing to the pandemic and supply chain disruption over thelast few years. The inability to conduct in-person meetings with customers had a major impact.
We believe that we can leverage some of the improvement measures implemented in Europe
to exit low margin businesses and deploy human resources more effectively. From this fiscalyear, an individual with direct experience of the Europe PMI process will lead an integrated
team with responsibility for Europe and North America. Improvement initiatives are alreadyunder way.

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Your forecast for the Electronics Industries in the fiscal year ending March 2024 calls for lower
profitability on a deterioration in product mix. How long do you think this situation will persist?
Will the current fiscal year be the worst with recovery to come early in next fiscal year? Or, do
you think current conditions will continue into next fiscal year?
We are expecting Electronics Industries’ profitability to decline in the fiscal year ending March2024 as a result of the increase in revenues generated from orders received for facilities in theprevious fiscal year, which includes projects that were important to win from a strategic
standpoint. In addition, we expect the precision tool cleaning business to be impacted bysemiconductor market conditions. The semiconductor market is likely to be challenging up to
1H of this fiscal year, but we expect to see an improvement from 2H. Also, a large proportionof the order backlog as of the beginning of this fiscal year will be converted to sales during thecurrent fiscal year. After this, the ratio of facilities orders is expected to decline. As such, webelieve that the dip in profitability will be a one-off just for the fiscal year ending March 2024.
Under PSV-27, service businesses for the Electronics Industries are expected to grow but I wasunder the impression to date that expanding the customer base for the Ultrapure Water Supply
business was challenging. You indicated that the service has been highly rated for its scalability
and ability to adapt content, in line with customer needs. Are you targeting existing customers
to drive future growth, or are you targeting new geographies or new customers? Please discuss
your expectations for growth going forward.
We will continue to place great importance on our existing customers. With regard to othercustomers, we believe that we can expand our customer base in future through a wide array ofwater supply solutions' proposals, based on the positive feedback already received on the valueof the service.
The profitability of the precision tool cleaning business is declining on a near term deteriorationof business conditions and the impact of higher costs. Under PSV-27, one of the themes is tobuild a framework that is less impacted by market conditions. Please describe how you expect
to achieve this and comment on the industries, regions or customer characteristics that you will
target.
First, in addition to winning business from customers where the Kurita Group's business waslimited to date, we aim to leverage high value-added technologies to build a precision cleaning
business in new fields. We will also focus on automation for tool cleaning and implementing
measures to pass on the higher costs.
Please provide an overview of Arcade, which you are planning to acquire in Europe, and theexpected contribution to earnings in the fiscal year ending March 2024.
As the transaction hasn't closed yet, we have not factored Arcade's earnings contribution into
our earnings forecasts for the fiscal year ending March 2024. The scale of revenue is several
billions of yen and it already generates a certain level of profit, but we believe that there is roomfor further improvement.

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What is the expected profitability of the General Industries business during PSV-27? Given thehigh proportion of sales coming from the high-margin chemicals business, optically, theprofitability of the other parts of the business appears weak. Is there room to further raise thetarget level for business profits?
While there is room to improve profitability for the General Industries business, there are alsochallenges. We are targeting a 4%-point improvement to the business profit margin. In
addition to growing the CSV business which mainly focuses on chemicals, we will swiftly
implement profit-improving measures for KAI and the industrial and social infrastructurebusinesses, which are facing some issues.
When looking at the breakdown of sales growth for Electronics Industries under PSV-27, thefacilities business is largely unchanged from the current level, with growth coming from theservice businesses. You also indicated you are planning to enter the electronics industry
facilities business in Europe and the U.S. Will service businesses be the driver for growth fromthe outset?
Directionally, we are aiming to grow the service businesses; our plan does not assume growthin the scale of the facilities business. We will be selective about the facilities business weundertake, concentrating on projects that will lead to opportunities for service business.
The target for the precision tool cleaning business in the fiscal year ending March 2028 is 45
billion yen. Currently, a high proportion of sales is generated in the U.S. What is your image forthe regional breakdown going forward? Will this business continue to be concentrated in Japanand the U.S.?
Currently, the precision tool cleaning subsidiary in Japan only operates domestically but theU.S. subsidiary does business in regions outside of the U.S. Going forward, if we feel that there
are areas where we can provide value, we could choose to enter new geographies.
You discussed expanding the electronics industry facilities business into Europe and the U.S.
but I believe Asia, including China, South Korea and Taiwan, is a very important geography.
Please describe your view of the facilities business in Asia for the fiscal year ending in March2024 and whether you expect to be able to raise your market share over the medium- to longterm.
In the previous fiscal year, we won orders for facilities business in China and South Korea,
mainly from the semiconductor industry. We expect sales to increase as a result of progress onconstruction for existing orders in the current fiscal year. Over the medium- to long-term, we
expect China will further strengthen the semiconductor industry but as a result of U.S.-China
trade friction and the high likelihood that this will have an impact on component procurementsof devices originating from the U.S., we are now focused on building a business framework
where fabrication can be fully completed within China, including component procurements.
In South Korea, investment appetite, chiefly for semiconductors, remains high. We aim to growour business with not only facilities projects but through value propositions that tie into servicebusinesses. We are not fixated on raising our share by winning facilities projects; our focus ison growing the service business.

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What made it difficult to grow the customer base for the Ultrapure Water Supply business up tothis point? How is this factor reflected in the PSV-27 measures?
Up to now, the core of our value proposition for the Ultrapure Water Supply business had been
the reduction of initial costs and the easing of the operational management burden. However,for customers with a different focus, this was not a compelling proposition. To grow the customer
base going forward, one key point will be the building of a diverse array of solutions proposals
in the Ultrapure Water Supply business. For instance, customers aiming to realize a circular
economy or strengthen initiatives related to non-financial metrics have rated highly ourproposals which go beyond water supply to incorporate reuse of waste or liquid waste and otherelements. We are assuming these types of initiatives under PSV-27 will lead to an expansionof the customer base.
What were the results for the service contract-type business and the solutions model for thefiscal year ended March 2023?
On a non-consolidated basis, we generated sales of around 5.2 billion yen in service contracttype business and solutions model sales of around 2.1 billion yen.
I believe that Kurita has focused on improving profitability by transforming its business model,such as integrating the facilities and chemicals business. My impression is that the CSVbusiness is a key word for PSV-27. However, I am concerned that the CSV business is a
product/technology/business model where margins aren't necessarily high. If that is the case,it suggests the business that should be the focus of your plan is the service contract-typebusiness. How important is this business and what are the KPIs? Has there been a change indirection for the service contract-type business?
The basic approach for PSV-27 is to pursue service businesses. The CSV business includesservices such as the total solutions business. We aim to propose high value solutions througha diverse array of combinations of chemicals and facilities, and outright sales and services.
There hasn't been a significant directional change from the previous Medium-Term
Management Plan.
What are the KPIs you will be focusing on going forward? Can you share your image of themagnitude of the CSV business expansion and its expected contribution to improving
profitability?
To date we had focused on orders received in tracking the CSV business. From the fiscal year
ending March 2024, we will track sales, which should enhance visibility into the contribution toearnings. Our sales target for the CSV business in the fiscal year ending March 2024 is 50
billion yen; we expect to this to grow to 100 billion yen in the fiscal year ending March 2028.
We note that profitability has been a focus in identifying CSV business so margins are alreadyhigh. However, in addition to improving the contribution to overall profitability on the back ofincreased scale, we will also be implementing initiatives to improve the profitability of the CSV
business itself.

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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