Financial Results for First Quarter FY 2010
(for the year ending March 31, 2011)

July 30, 2010
Kawasaki Heavy Industries, Ltd.

Table of Contents

I. Consolidated Results for First Quarter FY2010
1
 Summary of Financial Results2
 Details of Change in Profit 1
3
 Details of Change in Profit 2
4
 Financial Results by Segment
5
Shipbuilding
6
Rolling Stock
7
Aerospace
8
Gas Turbines & Machinery
9
Plant & Infrastructure Engineering
10Motorcycle & Engine
11
Precision Machinery12 Financial Condition and Cash Flows

Ⅱ．Forecast for FY2010
 Revision of Forecast for the First Halfof FY2010
 Consolidated Operating Performance Forecast by Segment
 R&D/CAPEX/Number of Employees(Note) Change in Segment Information
Disclosure

13
14
15
16
17

I. Consolidated Results for First Quarter FY2010

Summary of Financial Results(Billion Yen)

FY2009.1Q

FY2010.1Q

Orders Received

191.7

329.4

137.7

Net Sales

256.7

277.3

20.6

Operating Income/Loss

- 5.3

11.6

17.0

Recurring Profit

- 1.4

11.3

12.8

Net Income/Loss

Change- 1.7

5.8

Yen / US$97

93

Yen / EUR

132

122

Exchange Rates ( weighted-average )

-1-

7.6

< Orders Received >Significant increase as a whole due to largescale orders received mainly in Rolling Stockand Aerospace segments< Net Sales >Increase in sales as a whole due to asignificant sales increase for emerging
markets in Precision Machinery segment< Profits >Profit improved significantly due to
implementation of the fixed cost reduction
especially in mass production businesses andother factors, despite the adverse impact of
the appreciation of the yen

Details of Change in Profit 1- FY2010.1Q vs. FY2009.1Q (Billion Yen)

【Operating Income/Loss】+ 17.0 （ FY2009.1Q - 5.3 Æ FY2010.1Q 11.6 ）Ch an ges in p ro duct m ix
FY2010.1Q
an d o t h er fact o rs

+ 10.1

11.6

D ecrease in sellin g, gen eral &adm in ist rat iv e ex p en ses
D ecrease in am o rt izat io n o f
n et t ran sit io n co st (N o t e)

FY2009.1Q

- 5.3

+ 2.1

+ 2.6
A dv erse im p act o ffluct uat io n o f
fo reign ex ch an ge rat e- 1.7

E ffect s o fsales in crease

Im p act o f risein m at erial p rice

+ 3.9

- 0.1

Note: Amortization of net transition cost stemming from a change inaccounting for retirement benefits and severance costs(approx.13.0 billion yen per year) was completed in FY2009.

-2-

Details of Change in Profit 2- FY2010.1Q vs. FY2009.1Q (Billion Yen)

【Non-operating Income/Expenses】- 4.1 （ FY2009.1Q 3.8 Æ FY2010.1Q - 0.2 ）Net Interest expense ( incl. dividend income )Equity in income of unconsolidated subsidiaries and affiliates
Gain and loss on foreign exchange
Others【Extraordinary Income/Losses】

0
+ 1.9
- 4.2
- 1.9

（ - 0.3 Æ - 0.3 ）（ 0.3 Æ 2.2 ）（ 3.2 Æ - 0.9 ）（ 0.6 Æ - 1.2 ）- 0.4 （ FY2009.1Q 0 Æ FY2010.1Q - 0.4 )Effect of application of accounting for asset retirement obligations
Bad debt expense for doubtful accounts of affiliates

-3-

- 0.2
- 0.2

（
（

0 Æ - 0.2 ）0 Æ - 0.2 ）Financial Results by Segment(Billion Yen)

Orders Received

Net Sales

Operating Income/Loss

FY20091Q

FY2010
1Q

ChangeFY20091Q

FY2010
1Q

ChangeFY20091Q

FY2010
1Q

ChangeShipbuilding

1.8

1.6

- 0.1

39.4

28.6

- 10.7

- 0.6

3.3

3.9

Rolling Stock

25.5

101.5

76.0

37.5

26.6

- 10.8

1.9

1.7

- 0.1

Aerospace

11.4

36.5

25.1

26.6

34.2

7.5

- 1.9

- 1.8

0.1

Gas Turbines & Machinery

52.3

33.0

- 19.2

44.7

49.9

5.1

1.2

4.0

2.7

Plant & Infrastructure
Engineering

15.8

32.0

16.2

16.5

20.4

3.9

- 0.5

0.2

0.8

Motorcycle & Engine

58.0

65.1

7.0

58.0

65.1

7.0

- 3.9

0.7

4.7

Precision Machinery

13.1

35.0

21.8

16.5

27.8

11.3

- 0.3

3.9

4.2

Other

13.5

24.2

10.7

17.2

24.4

7.1

- 0.3

0

0.4

-

-

-

-

-

-

- 0.8

- 0.6

0.1

191.7

329.4

137.7

256.7

277.3

20.6

- 5.3

11.6

17.0

Eliminations and corporate

Total

Note1: FY2009 figures are the recalculated figures based on the new industry segmentation and the new accounting standard which have been adopted since FY2010. Æ Refer to Page 17
Note2: “Eliminations and corporate” includes some expenses incurred at Head Office which were not allocated to each industry segment for internal reporting.

-4-

Shipbuilding
Main Products： LNG Carriers、LPG Carriers、VLCCs、Bulk Carries、Submarines and others
Note: FY2009 Operating Income is the recalculated figures based on the new accounting standard which has been adopted since FY2010 Æ Refer to Page 17(Forecast in April 90.0)

Orders Received0 FY2010.1Q （ vs. FY2009.1Q ）Orders Received: No orders received of new building ships as in theprevious first quarter
Net Sales: Decrease in sales of large-scale vessels
Operating Income: Income improved significantly due to profitability
improvement, and other factors

90.0

0
1.8

2.7

1Q

2Q

10.4

16.1
1.6

<Units of Orders Received and Sales of New Building Ships>0

Orders Received

3Q

FY20091Q

FY2010
Forecast

Net Sales(Forecast in April 120.0)

151.8
120.0

111.7

Sales

FY2009.1Q FY2010.1Q FY2009.1Q FY2010.1Q

LNG carriers
Small-sized LNG carriers
LPG carriers
VLCCs
Bulk carriers
Submarines

3(2)

3(3)

2(2)
1(0)
3(2)
2(2)

2(2)

Total

11(8)

15(13)9(7)1(1)

Note: ( ) = Sales units by percentage-of-completion method

 FY2010 Forecast （ vs. FY2009 ）Orders Received: Increase in orders received of new building ships
Net Sales: Net sales are expected to decrease due to sales decrease oflarge-scale vessels
Operating Income: Income is expected to increase due to profitability
improvement, and other factors

65.2
39.4

1Q

28.6

2Q

3Q

FY20091Q

FY2010
Forecast

3.3(Forecast in April 2.0)

Operating Income

2.0
1.5

1.4
0.8
1Q
2Q

3Q

FY2009- 0.6（Billion Yen / In accumulated amount）

1Q

FY2010
Forecast

 (For Reference) Joint Venture in China
NACKS was established in Nantong in December 1995, as a joint venture
between KHI and China Ocean Shipping(Group) Company, the biggest
shipping company in China and its capacity was expanded in 2008.
At NACKS, various types of commercial vessels such as very large-size
container ships, VLCCs, bulk carriers and car carriers are built by utilizing twolarge-scale docks for both domestic and overseas customers under thetechnical support from Kawasaki Shipbuilding Corporation.
(NACKS is an equity method affiliate.)-5-

Rolling Stock
Main Products : Electric train cars (incl. Shinkansen), Electric and diesel locomotives, Passenger coaches,
Platform screen doors, Gigacell (High-Capacity, Full Sealed Ni-MH Battery)
Note: FY2009 figures are the recalculated figures based on the new industry segmentation (excl. crushing machine) and the new accounting standard which have been adopted
since FY2010 Æ Refer to Page 17
 FY2010.1Q （ vs. FY2009.1Q ）(Forecast in April 130.0)

Orders Received
0

130.0
101.5

0
55.5

0

25.5

66.2

39.5

0
1Q

2Q

3Q

FY20091Q

FY2010
Forecast

Net Sales(Forecast in April 145.0)

150.0

145.0

110.5
72.5
37.5

1Q

26.6
2Q

3Q

FY20091Q

Orders Received: Significant increase due to large-scale orders
received of subway cars for Washington Metropolitan Area Transit
Authority
Net Sales: Decrease in sales for overseas market
Operating Income: Profitability remained the same level as in theprevious first quarter due to the cost reduction and other factors, despite
the adverse impact of sales decrease and the appreciation of the yen FY2010 Forecast （ vs. FY2009 ）Orders Received: Increase in orders received for Japan Railways andoverseas market
Net sales: Net sales is expected to be the same level as in the previous
fiscal year despite decrease in small projects such as spare parts
Operating Income: Income is expected to be the same level as in theprevious fiscal year despite the adverse impact of the appreciation of
the yen, and other factors

FY2010
Forecast

 (For Reference) The Present Status of New Overseas Projects
・North America- Working to receive orders mainly for heavy rails and commuter rails- Light Rail Vehicles (LRVs) for U.S. market is currently under development
・High-speed railways- There are plans in U.S., Vietnam and other countries
・Dedicated Freight Corridor - Western Corridor Phase I (Delhi – Mumbai)- Japanese ODA project, working to receive orders for electric locomotives
・E&M system projects in Asian region- Working with other companies

Operating Income(Forecast in April 8.0)

8.7

8.0

5.2
3.7
1.9

1Q

1.7

2Q

3Q

FY2009（Billion Yen / In accumulated amount）

1Q

FY2010
Forecast-6-

Aerospace
Main Products : Aircrafts for Japan Ministry of Defense, Component parts for commercial aircrafts (BOEING , Embraer), Missiles
Note: FY2009 Operating Income is the recalculated figures based on the new accounting standard which has been adopted since FY2010 Æ Refer to Page 17

Orders Received

 FY2010.1Q （ vs. FY2009.1Q ）Orders Received: Increase in orders received for component parts for
BOEING including B777
Net Sales: Increase in sales for Japan Ministry of Defense (MOD) andsales of component parts for BOEING B787
Operating Income/Loss: The same level as in the previous firstquarter due to the adverse impact of the appreciation of the yen, despitesales increase FY2010 Forecast （ vs. FY2009 ）Orders Received: Increase in orders received of component parts for
BOEING including B787 & B777
Net Sales: Net sales are expected to increase due to the production
increase of XP-1 on the mass production phase and of component partsfor BOEING B787
Operating Income: Income is expected to increase slightly despite theconsiderable amortized cost of investment incurred by initiating mass
production of component parts for commercial aircraft(Forecast in April 200.0)

0

200.0

0

171.3

0
79.9

0
0

46.5

36.5

11.4

0
1Q

2Q

3Q

FY2009

1Q

Net Sales

FY2010
Forecast(Forecast in April 215.0)

215.0

188.8
119.3
73.3
34.2

26.6
1Q

2Q

3Q

FY20091Q

Operating Income

FY2010
Forecast(Forecast in April 4.0)

0

4.0

3.7

3.3

0
0
0
0

0.3

1Q
2Q

3Q

1Q
FY2009- 1.9（Billion Yen / In accumulated amount）

FY2010
Forecast- 1.8

 For Reference- Aircrafts for Japan Ministry of Defense
The #1 test XC-2 transport aircraft manufactured at Kawasaki’s Gifu Works
completed a successful first flight in January 2010, and was delivered to Japan
Ministry of Defense on March 30, 2010 at the Works after a series of in-house testing.
- Component parts for commercial aircrafts
A new production facility (the South Plant) was completed in Kawasaki’s Nagoya
Works 1 in March, 2010 to support increasing production demands for the Boeing
787 Dreamliner. The South Plant is furnished with the same kind of state-of-the-art
equipment that is used in the North Plant which an extension was completed in July
2006. The new facility will enable Kawasaki to perform integrated production that
includes everything from composite component fabrication to forward fuselage
assembly.
- Space systems
A payload fairing for the H-IIA Launch Vehicle No.18 was shipped in June 2010.

-7-

Gas Turbines & Machinery
Main Products : Jet engines, Gas turbine co-generation system, Gas turbines & Steam turbines for marines & land,
Diesel engines, Marine Propulsion System, Aero-Dynamic Machinery
Note: FY2009 Operating Income is the recalculated figures based on the new accounting standard which has been adopted since FY2010 Æ Refer to Page 17

Orders Received(Forecast in April 220.0)

0.0
0.0
0.0
0.0
0.0
0.0

226.2

220.0

138.5
99.8
52.3

1Q

33.0
2Q

3Q

FY2009

1Q

Net Sales
0
0
0
0
0
0
0

(Forecast in April 210.0)

210.0

191.3
128.8
83.4
49.9

44.7

1Q

2Q

3Q

FY20091Q

Operating Income
0
5
0
5
0
5
0
5
0

FY2010
Forecast

1Q

2Q

FY2010
Forecast<Summary of Major Projects for Commercial Aircraft Jet Engines>

10.0

Aircraft

FY2009（Billion Yen / In accumulated amount）

1Q

FY2010
Forecast

TrentXWB
A350

Full Partner

RRSP（※)RRSP（※)

Approx. 6%

Approx. 8.5%

Approx. 7%

（※）

-8-

Trent1000
B787

Share
Responsible
Components
3Q

V2500
A320 and others

Participation Type

4.0

3.9
1.4

 FY2010 Forecast （ vs. FY2009 ）Orders Received: Orders received remain the same level as in theprevious fiscal year
Net Sales: Net sales are expected to increase due to sales increase inmarine machinery and aero-dynamic machineryOperating Income: Income is expected to increase due to sales
increase, and other factors(Forecast in April 10.0)

8.9

1.2

 FY2010.1Q （ vs. FY2009.1Q ）Orders Received: Decrease in orders received for component parts forcommercial aircraft jet engines that had a large order received in theprevious first quarter, and for marine diesel engines
Net Sales: Increase in sales of gas turbine-driven natural gas
compressors
Operating Income: Income increased due to sales increase, and otherfactors

Intermediate
Intermediate
Fan case, vane, disc,pressurepressure
low-pressure compressor blade compressor (IPC) compressor (IPC)
modulemoduleRisk & Revenue Sharing Partner

Plant & Infrastructure Engineering
Main Products: Industrial plants (cement, chemical and others), Power plants, LNG & LPG tanks, Municipal refuse incineration plants, Shield machines, Crushing Machine
Note: FY2009 figures are the recalculated figures based on the new industry segmentation (incl. crushing machine) and the new accounting standard which have been adopted
since FY2010 Æ Refer to Page 17

 FY2010.1Q （ vs. FY2009.1Q ）Orders Received: Increase in orders received for various types ofplants in both domestic and overseas markets
Net Sales: Increase in sales of large-scale fertilizer plant for
Turkmenistan and LNG tanks for domestic market
Operating Income: Income improved due to sales increase, and otherfactors

Orders Received(Forecast in Ap ril 120.0)

135.6

120.0

98.7
37.5

32.0

15.8
1Q

2Q

3Q

FY20091Q

FY2010
Forecast

 FY2010 Forecast （ vs. FY2009 ）Orders Received: Decrease in large-scale orders received for overseas
customers
Net Sales: Net sales are expected to increase slightly despite decreasein large-scale projects
Operating Income: Income is expected to decrease due to decrease inhighly profitable projects

Net Sales(Forecast in Ap ril 110.0)

110.0

107.5
59.0
43.3
20.4

16.5
1Q

2Q

3Q

FY20091Q

FY2010
Forecast

 (For Reference) Joint Ventures in China
In 2006, KHI started a joint venture with Anhui Conch Cement Company Ltd.,
China’s largest cement manufacturer. KHI has established three joint ventures
for the time being and set up an integrated system in China encompassing thedesign, production, sales and after-sale services of waste heat recovery power
generation systems for cement plants and cement producing facilities (Preheaters, Rotary Kilns and Roller Mills) with sophisticated technologies it has
accumulated. KHI will contribute further to bring technologies such as awaste gasification system that can be integrated with cement kilns and amembrane sewage treatment system, for environment and energy conservationin China.

Operating Income(Forecast in April 6.0)

7.9

6.0

1.7
1Q

- 0.5

2Q

0.7
3Q

0.2
FY2009（Billion Yen / In accumulated amount）

1Q

FY2010
Forecast-9-Motorcycle & Engine
Main Products: Motorcycles, All-Terrain Vehicles(ATVs), Utility Vehicles, Personal Watercraft、General-Purpose Gasoline Engines
Note: FY2009 figures are the recalculated figures based on the new industry segmentation (excl. industrial robots) and the new accounting standard which have been adopted
since FY2010 Æ Refer to Page 17

Net Sales(Forecast in April 260.0)0 FY2010.1Q （ vs. FY2009.1Q ）Net Sales: Sales increase in emerging countries, and other factors
Operating Income: Income improved significantly due to sales
increase and the effects of business restructuring measures
implemented through the previous fiscal year, despite the adverse
impact of the appreciation of the yen

260.0
203.0

0

144.0
100.9

0

65.1

58.0

0
1Q

2Q

3Q

FY20091Q

FY2010
Forecast

 FY2010 Forecast （ vs. FY2009 ）Net Sales: Net sales are expected to increase due to the effects ofliquidation of the excess inventory implemented in the previous fiscal
year and the effects of sales increase in Asian and other emerging
markets
Operating Income:
Income is expected to improve dramatically due to sales increase andthe effects of business restructuring measures implemented through theprevious fiscal year

Operating Income(Forecast in April 0)

1Q

2Q

3Q

FY20090.7

01Q

FY2010
Forecast

0
0

- 3.9
-13.3

0

- 21.10- 27.0（Billion Yen / In accumulated amount）

 For Reference＜Sales by Geografic Area for Consumer Products＞

Domestic
North America
EuropeEmerging Countries & Others

Total

FY2009.1Q
Unit
Amount6
4.7
25(19)
17.9
24
18.8
46
8.3
101
49.7

FY2009Unit
Amount17
12.9
80(49)
56.3
72
56.2
228
45.1
397
170.5

(Thousands of unit / Billion Yen)FY2010.1Q
Unit
Amount4
2.9
27(15)
20.8
22
16.1
66
14.4
119
54.2

FY2010 Forecast
Unit
Amount16
12.2
126(66)
87.0
72
58.8
296
62.3
510
220.3

- A joint venture, CK&K, was established in China with Kwang Yang Motor Co.,
Ltd.(KYMCO) of Taiwan for production and sales of general purpose gasoline
engines. Production started in January 2010. (CK&K is an equity method affiliate.)- New motorcycle production plant started up at Kawasaki’s Brazilian subsidiary,
KMB, in October 2009.
- New subsidiary, IKM, was established in India on July 1, 2010 to import and sell
motorcycles.

Note: 1) Sales units and amount include the following products.
Units: Motorcycles, All-Terrain Vehicles(ATV), Utility Vehicles and Personal Water Craft(Jet Ski)
Amount: The products mentioned above and parts for those products.
2) Figures in the parenthesis ( ) represent motorcycle sales units.

- 10 -

Precision Machinery
Main Products： Hydraulic components (pumps, motors & valves), Hydraulic systems for industrial use, Hydraulic marine machinery, Industrial Robots
Note: FY2009 figures are the recalculated figures based on the new industry segmentation (incl. industrial robots) and the new accounting standard which have been adopted
since FY2010 Æ Refer to Page 17

Orders Received(Forecast in April 110.0)

.0
110.0

.0
84.9

.0
54.8

.0
.0

35.0

32.8
13.1

.0
1Q

2Q

3Q

FY2009

1Q

Net Sales

FY2010
Forecast(Forecast in Ap ril 110.0)

110.0
82.7
55.4
34.2

27.8

16.5

1Q

2Q

3Q

FY20091Q

FY2010
Forecast

 FY2010.1Q （ vs. FY2009.1Q ）Orders Received :Increase in orders received for hydrauliccomponents for construction machinery in emerging countries
Net Sales: Increase in sales of hydraulic machinery for construction
machinery and industrial robots for manufacturers of semiconductor
production equipments
Operating Income: Income improved due to sales increase, and otherfactors
 FY2010 Forecast （ vs. FY2009 ）Orders Received & Net Sales:
Both orders received and net sales are expected to increase due to therecovering demand for hydraulic machinery for construction
machinery in Asian and other emerging markets, and industrial robots
for manufacturers of semiconductor production equipments
Operating Income: Income is expected to increase due to sales
increase （For Reference） Businesses Development in China

Operating Income
5
5
5
5
5
5
5
5
5
5

(Forecast in April 8.0)

8.0

3.4
1Q

2Q

0.7

- 0.3

- 0.6

3Q

FY2009（Billion Yen / In accumulated amount）

3.9

1Q

FY2010
Forecast

In August 2006, production of hydraulic pumps started at Chinese subsidiary in
Suzhou to meet the increasing demand in China. Also, in Zhejiang, a joint venture of
hydraulic machinery manufacturing was established with a Chinese company andproduction started in April 2010. In order to provide the products manufactured at theabove two manufacturing companies to customers throughout China, a sales
subsidiary was established in Shanghai and its operation started in April 2010.
Through establishment of the subsidiaries and a joint venture, we have consolidated
our operating system to enhance our presence in Chinese construction machinery
market in which a tremendous growth potential is expected, and to further expand
and deepen our business operations.

- 11 -

Financial Condition and Cash Flows【Financial Condition】(Billion Yen)

FY2009End of March 2010

FY2010End of June 2010

1,352.4

1,325.5

Shareholders’ Equity

277.0

275.7

（Ratio of shareholders’ equity to total assets）(20.4%)（20.8%）

Interest-bearing debt

428.9

450.1

（Net Interest-bearing debt）（394.1）（424.6)

Net Debt Equity Ratio

142%

153%

Total Assets

Note: Interest-bearing debt includes lease obligations【Cash Flows】（Billion Yen）

FY2009.1Q

FY2010.1Q

Cash flows from operating activities- 27.2

0.1

Cash flows from investing activities- 22.8- 12.3

Free Cash Flows- 50.0- 12.1

Cash flows from financing activities

40.3

1.9

- 12 -

II. Forecast for FY2010

Revision of Forecast for the First Half of FY2010(Billion Yen / In accumulated amount)(FYI)
FY2009.2Q

FY2010.2Q Forecast
Forecast in Apr. Forecast in Jul.

ChangeActualNet Sales

580.0

580.0

0

516.0

Operating Income/Loss

7.0

15.0

8.0

- 6.1

Recurring Profit

6.0

14.0

8.0

- 1.2

Net Income/Loss

5.0

7.0

2.0

- 6.2

Yen / US$

90

90

96

Yen / EUR

125

115

133

< Reasons for the Revision >* The forecast for operating income, recurring
profit and net income of second quarter(accumulated) were revised up, reflecting
steady sales for emerging markets in the firstquarter period* However, the full year forecast remains
unchanged because of uncertainty about
economies in developed countries, material
price, foreign exchange rates, and otherfactors

Exchange Rates (actual & assumed)

Note: Assumed rate is applied to the foreign exchange exposure as of July 30, 2010.

- 13 -* Assumed rate for Yen/EUR was changed
from 125 yen to 115 yenConsolidated Operating Performance(Billion Yen / In accumulated amount)

FY2009FY2010

ActualForecast< Orders Received >ChangeSignificant recovery of orders received is expectedin Shipbuilding, Rolling Stock and other segments,
despite orders received in Plant & Infrastructure
Engineering segment are expected to decrease

Orders Received

1,001.2

1,240.0

238.7

Net Sales

1,173.4

1,280.0

106.5

Operating Income/Loss

- 1.3

32.0

33.3

Recurring Profit

14.2

32.0

17.7

Net sales are expected to increase in mass
production businesses such as Motorcycle &Engine and Precision Machinery segments due togradual recovery of the demand, while sales
decrease is expected in Shipbuilding segment

Net Income/Loss- 10.820.0

30.8< Profits >Exchange Rates (actual & assumed)

Yen / US$93

90

Yen / EUR

130

115

Note1: Assumed rate for Yen/EUR was changed from 125 yen to 115 yen.
Note2: Assumed rate is applied to the foreign exchange exposure as of July 30, 2010.
（For Reference）
Impact on profit by FX fluctuation of 1 yen(Billion Yen)

US$
EUR

Operating
Income1.8
0.3

Recurring
Profit1.2
0.3- 14 -< Net Sales >Significant improvement is expected in Motorcycle& Engine segment due to sales increase inmotorcycles and the effects of businessrestructuring measures implemented through theprevious fiscal year

Forecast by Segment(Billion Yen / In accumulated amount)

Orders Received
FY2009ActualNet Sales

FY2010
Forecast

FY2009ActualOperating Income/Loss

FY2010
Forecast

FY2009Actual

FY2010
Forecast

Shipbuilding

16.1

90.0

151.8

120.0

1.5

2.0

Rolling Stock

66.2

130.0

150.0

145.0

8.7

8.0

Aerospace

171.3

200.0

188.8

215.0

3.7

4.0

Gas Turbines & Machinery

226.2

220.0

191.3

210.0

8.9

10.0

Plant & Infrastructure
Engineering

135.6

120.0

107.5

110.0

7.9

6.0

Motorcycle & Engine

203.0

260.0

203.0

260.0

- 27.00Precision Machinery

84.9

110.0

82.7

110.0

3.4

8.0

Other

97.5

110.0

97.8

110.0

- 1.0

1.0

-

-

-

-

- 7.5

- 7.0

1,001.2

1,240.0

1,173.4

1,280.0

- 1.3

32.0

Eliminations and corporate
Total

Note1: FY2009 figures are the recalculated figures based on the new industry segmentation and the new accounting standard which have been adopted since FY2010. Æ Refer to Page 17
Note2: “Eliminations and corporate” includes some expenses incurred at Head Office which were not allocated to each industry segment for internal reporting.

- 15 -

R&D/CAPEX/Number of Employees(Billion Yen / Persons)

FY2009Actual

FY2010
Forecast

ChangeR&D Expenses

38.0

40.5

2.4

CAPEX
(Construction Base)

59.2

66.0

6.8

Depreciation & Amortization

51.4

54.0

2.6

Domestic

24,396

24,600204

Overseas

7,901

7,800

- 101

Number of Employees

32,29732,400103- 16 -

(Note) Change in Segment Information Disclosure＜Change in Industry Segment and Segment Denomination＞
Industry segment and segment denomination have been changed as stated below, in accordance with
the new industry segmentation for internal reporting which has been adopted since April 2010.
Change in Industry Segment
Crushing Machine business unit :(Previous) “Rolling Stock segment” Æ (Current) “Plant & Infrastructure Engineering segment”
Industrial Robots business unit :(Previous) “Consumer Products & Machinery segment” Æ (Current) “Precision Machinery segment”
Change in Segment Denomination（Previous) “Consumer Products & Machinery segment” Æ (Current) “Motorcycle & Engine segment”(Previous) “Hydraulic Machinery segment” Æ (Current) “Precision Machinery segment”＜Application of New Financial Accounting Standard for Segment Information Disclosure＞
With the previous accounting standard, operating income by industry segment was presented with reflecting
re-allocation of some expenses incurred at Head Office which were not allocated to each segment for internalreporting.
However, as a new accounting standard adopting "Management Approach" has applied since FY 2010 in Japan,such expenses will not have been re-allocated to each segment.
Accordingly, for the readers' convenience, recalculated FY2009 operating income based on the new accounting
standard is presented on certain pages of this material to easily compare with the financial results for the previous
fiscal year.
- 17 -

Kawasaki,
Working as One for the Good of the Planet

Cautionary Statement
The performance outlook and the forecasts stated in this material were prepared by Kawasaki Heavy Industries, Ltd.
(hereinafter, KHI) based on the circumstances at the release point, and include potential risks and uncertain factorsthat relate to economic conditions, foreign currency exchange rates, tax rules, regulations and other factors.
Accordingly, please note that the actual operating results, financial position, and business deployment of KHI
may sometimes differ considerably from the descriptions in the present projections.