FOR IMMEDIATE RELEASE
Kurita Water Industries Reports Earnings for the Third Quarter Ended December 2004
Tokyo, Japan January 31, 2005—Kurita Water Industries Ltd. (TSE Security Code 6370)
announced year-to-date revenue for the third quarter ended December, 2004 of 101,240
million yen and year-to-date earnings of 4,555 million yen, or 35.42 yen per share.
Summary of Operating Results
Total consolidated orders for the nine months ended December 31, 2004 increased by 9.9%
over the previous year to 121,595 million yen, while net sales for the same period increased
12.6% to 101,240 million yen. As a result, operating income for the nine months period
increased by 74.5% to 7,860 million yen and ordinary income grew by 80.8% to 8,212 million
yen, resulting in a net income increase of 40.1% to 4,555 million yen. Particularly noteworthy
was the improvement in S.G. & A. margin to 24.4% of sales from 27.3% of sales for the same
period the previous year. By segment, water treatment chemicals sales increased by 4.7% overthe previous year to 36,603 million yen, while water treatment facilities sales grew by 17.6%
to 64,636 million yen.
During the quarter, the Group’s operations were supported by continued strong capital
expenditures in the electronics industry of Japan, Taiwan and South Korea, and an emerging
recovery in capital expenditures in other industries as well. However, public works
expenditure related demand remained weak, reflecting continued reductions in budgeted
expenditures in the public sector.
Segment Information
Water Treatment Chemicals
Total group orders for the segment for the nine months ended December 31, 2004 increased by
7.0% from the same period a year earlier to 38,101 million yen and accounted for 31.3% of
total orders versus 32.2% of total orders for the same period of the previous fiscal year. Sales
for the nine months increased by 4.7% to 36,603 million yen and were 36.2% of total sales
versus 38.9% of sales in the previous year.
Water treatment chemicals orders for the nine months period were supported by efforts to
expand sales of new products more aligned with customer needs, and to expand contracts for
integrated management services related to water treatment. Orders increased for theCompany’s mainstay cooling water and waste water treatment chemicals, while orders forboiler water treatment chemicals recorded a slight decline. In other products, orders forprocess treatment chemicals from the pulp and paper industry increased, as did orders forwater treatment maintenance and services. On the other hand, orders for agents to solidify
heavy metal contained in waste incineration fly ash recorded a slight decline.
Water Treatment Facilities
Total group orders for the segment for the nine months ended December 31, 2004 increased by
11.2% from the same period a year earlier to 83,494 million yen and accounted for 68.7% of
total orders versus 67.8% of total orders for the same period of the previous fiscal year. Sales
for the nine months increased by 17.6% to 64,636 million yen and were 63.8% of total sales
versus 61.1% of sales in the previous year.
The increase in orders for the segment was supported by the Company’s efforts to expand its

“solutions business” with proposals based on appraisals of the fundamental problems
customers need to solve, and its “outsourcing business”, particularly ultra-pure water supply
business where the company offers construction, retention, operation and maintenanceservices for ultra-pure water production system.
The increase in private sector orders was driven by orders for the Company’s mainstay
ultra-pure water production systems for the electronic industry, where an increase was seenin orders for tool cleaning services for semiconductor and liquid crystal display production
equipment, as well as other maintenance services. In addition, there was an increase inorders for other private sector water treatment facilities. On the other hand, public sector
orders for sludge recycling facilities declined owing to a concentration of large facility orders
in the previous year, while there was a slight increase in sewage system-related orders.

Order intake(in million yen)
3Q ended Dec. 31, 2004
(April 1, 2004 toDecember 31, 2004)

3Q ended Dec. 31, 2003
(April 1, 2003 toDecember 31, 2003)

y-t-ychange vs3Q 2003

Year ended March 2004
(April 2003 toMarch 2004)

AmountAmountAmountAmountSegment
Water treatment
chemicals
Water treatment
facilities
Total%%%

38,101

31.3

35,604

32.2

2,497

47,516

31.7

83,494

68.7

75,072

67.8

8,422

102,218

68.3

121,595

100.0

110,677

100.0

10,918

149,735

100.0

Net sales(in million yen)
3Q ended Dec. 31, 2004
(April 1, 2004 toDecember 31, 2004)

3Q ended Dec. 31, 2003
(April 1, 2003 toDecember 31, 2003)

y-t-ychange vs3Q 2003

Year ended March 2004
(April 2003 toMarch 2004)

AmountAmountAmountAmountSegment
Water treatment
chemicals
Water treatment
facilities
Total%%%

36,60336.2

34,962

38.9

1,641

47,442

32.3

64,636

63.8

54,959

61.1

9,677

99,37767.7

101,240

100.0

89,922100.0

11,318146,819

100.0

Financial Condition
Total assets for the third quarter declined by 1,874 million yen from the end of the previous
fiscal year, reflecting a 14,511 million yen decline in accounts receivable, which was partiallyoffset by a 10,185 million yen increase in inventories, and a 1,798 million yen increase intangible fixed assets resulting from the purchase of fixed operating assets. Total liabilities
decreased 4,805 million yen, reflecting a decrease in accrued liabilities and expenses of 2,004
million yen, and a 2,807 million yen decrease in income taxes payable. Shareholders’ equity
increased 2,847 million yen, owing mainly to a 2,316 million yen increase in retained earnings.
As a result, the Company’s shareholder equity ratio improved to 72.4% from 70.1% at the endof the previous fiscal year.
Outlook for the Full Fiscal Year
Given the favorable business performance for the third quarter, the Company believes it canachieve its forecasts for the March, 2005 full fiscal year as previously announced.
About the Kurita GroupThe Kurita Group provides a wide range of products, technologies, and maintenance services
related to water treatment. The two core lines of the Group’s business consist of; 1) water
treatment chemicals used for boiler water, cooling water, waste water, and in manufacturing
processes; and 2) water treatment facilities such as ultra-pure water production systems,waste water treatment facilities, and sewage water treatment facilities. The business scope ofboth lines includes production, sales, and maintenance services. For additional information
about the Kurita Group, please visit the Company’s website at www.kurita.co.jp.
Except for the historical information contained herein, matters discussed in this news release
may contain forward-looking statements that involve risks and uncertainties, including but

not limited to factory operating ratios at major clients in the steel, petroleum and paper/pulpindustries; capital expenditure trends in the electronics, food, pharmaceuticals, basic
material and automobile industries; and the financial condition and budgeting actions ofnational and local governments in Japan.

KURITA WATER INDUSTRIES, LTD.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME(in million yen)

Net Sales
Cost of Sales
Gross Profit
Selling, General and
Administrative Expenses
Operating Income
Non-operating Income
Non-operating Expense
Ordinary Income
Special Gains
Special Losses
Income before Income Taxes
Income Taxes
Minority Interests in Earnings
of Consolidated Subsidiaries
Net Income

3Q ended Dec. 31, 2004
(April 1, 2004 to
December 31, 2004)% ofAmountNet Sales
101,240
100.0
68,69567.8
32,54432.2

3Q ended Dec. 31, 2003
(April 1, 2003 to
December 31, 2003)% ofAmountNet Sales
89,922100.0
60,86767.7
29,054
32.3

Increase/Decrease
Amount11,318
7,828
3,490

Previous Fiscal Year
(April 1, 2003 toMarch 31, 2004)% ofAmountNet Sales
146,819100.0
101,433
69.1
45,38630.9

24,68424.4

24,55027.3

13431,895

21.7

7,860
679
326
8,212
8,212
3,542

7.8
0.6
0.3
8.1
8.1
3.5

4,504
686
649
4,541
1,414
5,955
2,596

5.0
0.7
0.7
5.0
1.6
6.6
2.9

3,356
-7
-323
3,671
-1,414
2,257
946

13,4901,034
586
13,938
1,479
499
14,918
6,347

9.2
0.7
0.4
9.5
1.0
0.3
10.2
4.3

1140.1

107

0.1

7

126

0.1

4,555

4.5

3,251

3.6

1,304

8,444

5.8

CONDENSED CONSOLIDATED BALANCE SHEET(in million yen)

[Assets]
Current Assets
Cash and Deposits
Notes Receivable - Trade
Accounts Receivable - Trade
Marketable Securities
Inventories
Other
Allowance for Doubtful
Accounts
Total Current Assets
Fixed Assets
Tangible Fixed Assets
Intangible Fixed Assets
Investments and Other Assets
Total Fixed Assets
Total Assets[Liabilities]
Current Liabilities
Notes Payable - Trade
Accounts Payable - Trade
Outstanding
Payments/Expenses
Income Taxes Payable
Other
Total Current Liabilities
Fixed Liabilities
Accrued Employees’
Retirement Benefits
Other
Total Fixed Liabilities
Total Liabilities[Minority Interests]
Minority Interests[Shareholders’ Equity]
Common Stock
Additional Paid-in Capital
Retained Earnings
Revaluation Surplus of OtherSecurities
Foreign Currency Translation
Adjustments
Treasury Stock
Total Shareholders’ Equity
Total Liabilities, Minority
Interests and Shareholders’EquityAs ofDecember 31,
2004

As of
December. 31,
2003

36,052
10,592
41,563
4,100
16,8983,705

31,20810,35535,4198,967
13,622
6,014-131

As ofMarch 31,2004

Increase/Decrease overDec. 31,2003

March 31,2004

35,512
10,60756,074
6,720
6,713
3,435

4,844
237
6,144
-4,8673,276-2,309540-15-14,511-2,620
10,185
270

-132

-140

1

9

112,781

105,454

118,923

7,327-6,142

43,4693,265
22,23068,965
181,746

42,384
3,333
20,397
66,115
171,570

41,671
3,347
19,67864,697
183,620

1,085
-68
1,833
2,850
10,176

1,798
-82
2,552
4,268
-1,874

1,908
23,9781,550
18,988

1,371
25,517

358
4,990

537
-1,539

5,124

5,938

7,128

(814)

-2,004786
6,272
38,071

650
7,776
34,9053,593
5,342
42,954136-1,504
3,166-2,807930-4,883

9,099

10,8059,149-1,706-50

1,935
11,035
49,107

1,779
12,58547,4901,808
10,95853,912156-1,550
1,617

127
77
-4,805

1,115

1,058

1,031

57

84

13,45011,409110,496

13,450
11,398102,713

13,450
11,398108,180

11
7,783

11
2,316

1,695

1,033

1,367

662

328

-701

-685

-829

-16

128

-4,827
131,523-4,888123,021

4,890
128,676

618,502

63
2,847

181,746

171,570

183,620

10,176-1,874