Financial Results for FY 2012
(for the year ended March 31, 2013)

April 25, 2013

Table of Contents

I. Consolidated Results for FY2012
 Summary of Financial Results Financial Results by Segment
 Details of Change in Profit I Details of Change in Profit II Financial Results by Segment
Ship & Offshore Structure
Rolling Stock
Aerospace
Gas Turbine & Machinery
Plant & Infrastructure
Motorcycle & Engine
Precision Machinery Financial Condition and Cash Flows

3
4
5
6

II． Forecast for FY2013

Consolidated Operating Performance
Forecast by Segment
R&D/CAPEX/Number of Employees

15
16
17

7
8
9
10
11
12
13
14

©
2 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved2

I. Consolidated Results for FY2012

Summary of Financial Results(Billion Yen)FY2011
Actual

FY2012

Change※Forecastin January

Actualvs. FY2011

vs. FY2011

vs. Forecast
in January

Orders Received

1,311.8

1,330.0

1,369.5+ 57.7+ 39.5Net Sales

1,303.7

1,300.0

1,288.8- 14.8- 11.2

Operating Income

57.4

40.0

42.0

- 15.4+ 2.0

Recurring Profit

63.6

50.0

39.3

- 24.2- 10.7Net Income

23.3

30.0

30.8

+ 7.5

Exchange Rates ( weighted-average )Yen / US$

79.40

82.86

Yen / EUR

109.71

107.76※Assumed exchange rates for forecast in January : 1US$=85Yen

1EUR=110Yen© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved+ 0.8< Orders Received >Increased as a whole due to increase inorders received in Ship & Offshore Structure
and Rolling Stock segments, despite
decrease in orders received in Precision
Machinery segment< Net Sales >Remained at the same level as in theprevious fiscal year overall due to increase
in Aerospace segment, despite decrease in
Precision Machinery and Ship & Offshore
Structure segments< Profits >- Operating income and recurring profit
decreased due to decrease in Precision
Machinery and Plant & Infrastructure
segments, despite increase in Aerospaceand Motorcycle & Engine segments- However, net income increased because
partial write-down of deferred tax assets,
which had been recorded in the previous
fiscal year, was not recorded in this fiscal
year

3I. Consolidated Results for FY2012

Financial Results by Segment(Billion Yen)

Orders Received

Net Sales

Operating Income

FY2011FY2012

ChangeFY2011FY2012

ChangeFY2011FY2012

ChangeShip & Offshore Structure

39.9

105.7

+ 65.8

113.5

90.3

- 23.1

3.9

4.1

+ 0.1

Rolling Stock

66.0

124.4

+ 58.3

132.6

129.9

- 2.7

5.1

2.2

- 2.9

Aerospace

327.2

283.4

- 43.7

206.5

239.1

+ 32.5

7.8

14.8

+ 7.0

Gas Turbine & Machinery

227.2

255.5

+ 28.2

194.6

207.0

+ 12.3

7.7

7.0

- 0.7

Plant & Infrastructure

119.2

113.6

- 5.6

122.8

115.8

- 6.9

14.1

9.7

- 4.3

Motorcycle & Engine

235.2

251.8

+ 16.6

235.2

251.8

+ 16.6

- 2.9

2.3

+ 5.3

Precision Machinery

174.5

109.7

- 64.8

175.0

130.4

- 44.626.6

8.4- 18.1Others

122.2

125.1

+ 2.9

123.2

124.2

+ 1.0

3.8

1.2

- 2.5

-

-

-

-

-

-

- 8.8

- 8.0

+ 0.7

1,311.8 1,369.5+ 57.71,303.7 1,288.8- 14.857.4

42.0- 15.4

Eliminations and corporate
Total

Note : “Eliminations and corporate” includes some expenses incurred at Head Office which were not allocated to each industry segment for internal reporting© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved4

I. Consolidated Results for FY2012

Details of Change in Profit I- FY2012 vs. FY2011 【Operating Income】 - 15.4
vs. Forecast in January( FY2011 57.4  FY2012 42.0 )(Billion Yen)

+ 2.0 billion yen（Forecast in January 40.0  Actual 42.0 )Impact of fluctuation of foreign exchange rate
Effects of sales decrease
Others
Impact of fluctuationof foreign exchange
rate+ 12.4

+ 7.5
- 2.5
- 3.0

+ 7.1
Impact of change
in material price- 4.4

Effects ofsales decrease

FY2011
57.4

Increase in selling,
general & administrative
expenses- 3.9
Impact of changes
in product mix andother factors- 26.4FY201242.0© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved5

I. Consolidated Results for FY2012

Details of Change in Profit II- FY2012 vs. FY2011 -(Billion Yen)

【Non-operating Income/Expenses】- 8.8 ( FY2011 6.1  FY2012 - 2.7 )Net Interest expense ( incl. dividend income )-0.5（ - 1.9

Equity in income of unconsolidated subsidiaries and affiliates

-

0.0

（

8.5



Gain and loss on foreign exchange- 10.1（0.2

 - 9.9 ）Others

+ 1.8（ - 0.6【Extraordinary Income/Losses】

 - 2.5 ）



8.5 ）

1.1 ）

+ 21.7 ( FY2011 - 14.9  FY2012 6.8 )Gain on transfer of benefit obligation relating to employees' pension fund+ 8.6 （0.0

Provision for environmental measures

-

0.0

1.4 （



8.6 ）



- 1.4 ）

※1

Loss on impairment of fixed assets+ 14.5 （ - 14.9

※2



- 0.3 ）

Loss on impairment of fixed assets mainly in Ship & Offshore Structure segment whose book values were written
down to the recoverable amounts※2 Loss on impairment of idle assets whose book values were written down to the recoverable amounts※1© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved

6

I. Consolidated Results for FY2012

Ship & Offshore Structure
Main Products： LNG carriers, LPG carriers, VLCCs, Bulk carriers, Submarines, Offshore structures

 FY2012 （ vs. FY2011 )（Billion Yen / In accumulated amount）
Orders Received（Forecast in January 110.0）

105.7

120.0

Orders Received: Increased significantly due to orders received of a submarine
and five vessels including LNG carriers
Net Sales: Decreased due to decrease in amount of shipbuilding of large-scale bulk
carriers
Operating Income: Remained at the same level as in the previous fiscal year due
to cost reduction, the effect of the depreciation of the yen and other factors, despite<Units of O rde rs R e ce ive d and Sale s of Ne w Building Ships>(unit)
sales decrease
Orders Received
FY2011

17.0

24.6

36.9

39.9

30.3

37.8

LNG carriers

42.9

2Q

3Q

Net Sales

FY2011

113.5

1Q

2Q

70.0

45.8

27.7

22.7
2Q

3Q

FY2011

1Q

Operating Income
4.1

1Q

FY2013
Forecast

90.3
68.6

53.1

0.9

FY2012（Forecast in January 80.0）

87.1

1Q

3Q

2Q

2Q

3Q

FY20124.4

3.9

FY2013
Forecast

4.1

1.0

0

1Q

3Q

FY2011

-0.6

2

2(1)

FY2012

2(2)

2(1)

1(1)

1

LPG carriers

1

1

2(1)

2(1)

Bulk carriers

62

25(14)

21(5)

1

2(1)

1(1)

8

6

33(18)

27(10)

Total

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

Orders Received: Expected to increase due to orders received of new building shipincluding gas carriers
Net Sales: Expected to decrease due to stagnation of ship price and decrease inamount of shipbuilding
Operating Income: Expected to decrease due to sales decrease, percentage
increase in lower margin vessels and other factors<For Reference> Business Development in Overseas（Forecast in January 3.0）

0.5

 FY2013 Forecast （ vs. FY2012）

FY2011

Sm all-size d LNG carrie rs

Submarines

1Q

Sales

FY20122Q

3Q

FY2012FY2013
Forecast

NACKS was established in December 1995, as a fifty-fifty joint venture between KHI and China Ocean
Shipping (Group) Company (COSCO), one of the world’s largest shipping company, and its capacity was
expanded in 2008. At NACKS, various types of commercial vessels are built for domestic shipping
company such as COSCO as well as for Japanese and European customers.
As a parent company of NACKS, KHI has also supported DACKS, which was initially established by NACKS
and COSCO Group, since its establishment in July 2007. In order to make it more competitive and further
expand its operations, KHI acquired a 34% stake in DACKS in April 2012. As a result, KHI’s actual ratio ofinvestment in DACKS (including indirect investment) is 49%.
Meanwhile, KHI decided to participate in a joint venture project for building drill ships etc. in Brazil,
where the demand for the drill ships & FPSO for the drilling and production of offshore oil is rapidly
increasing, executed a shareholders agreement with Estaleiro Enseada do Paraguaçu S.A. (EEP) in May
2012 and acquired a 30% stake in EEP.
With a view to expanding operations and boosting profitability at two shipyards in China and developing
the new shipyard in Brazil as the third overseas shipyard, KHI will further deepen cooperation between its
bases at home and three overseas shipyards, and actively pursue shipbuilding by taking advantage of thefeature of each shipyard.

© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved

7

I. Consolidated Results for FY2012

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) FY2012 （ vs. FY2011 ）（Billion Yen / In accumulated amount）
Orders Received（Forecast in January 140.0）

160.0

124.4
93.1

22.6
1Q

42.1

2Q

49.9

66.9

66.0

 FY2013 Forecast （ vs. FY2012 ）

25.3

3Q

FY2011

1Q

2Q

3Q

132.6

129.9

94.6
55.3

2Q

FY2013
Forecast

28.8
3Q

155.0

FY2011

1Q

51.4

2Q

3Q

FY2012FY2013
Forecast

Operating Income
4.9
0
1Q

5.1

6.0

2.2

1.1
2Q

（Forecast in January 2.0）

0.1
3Q

FY2011

2Q

1Q

3Q-0.5 FY2012-3.1

Orders Received: Expected to increase due to increase in orders received foroverseas market
Net Sales: Expected to increase due to sales increase for overseas market mainly inNorth America
Operating Income: Expected to increase due to sales increase, improvement in
profitability and other factors<For Reference> Present Status of Overseas Projects

94.1

25.8
1Q

FY2012（Forecast in January 130.0）

Net Sales

Orders Received: Increased overall due to orders received for high-speed rail cars
for Taiwan, subway cars for Singapore and other projects
Net Sales: Remained at the same level as in the previous fiscal year because ofsales increase for Japan Railways (JR) companies, despite sales decrease foroverseas market
Operating Income: Decreased due to decrease in profitability of overseas projects

FY2013
Forecast

North America- Extensively working to win orders mainly for heavy rails, commuter rails and highspeed rails.
- Extension of product lineup such as efSET® and K-Star Express® to meet demand
for semi high-speed and high-speed rail projects.
- Working to win orders for high-speed rail for California, and semi high-speed railfor Amtrak (The National Railroad Passenger Corporation).
Asia- There are construction and expansion plans of the urban transport systems inseveral Asian cities, and High-speed railways projects in India.
- KHI will work to win new projects in the markets such as Taiwan and Shingapore,
where we have the solid track record.
- Dedicated Freight Corridor - Western Corridor (Delhi – Mumbai)
Japanese ODA project, working to receive orders for electric locomotives andmaintenance base facilities and others.

© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved

8

I. Consolidated Results for FY2012

Aerospace
Main Products : Aircrafts for Japan Ministry of Defense, Component parts for commercial aircrafts (Boeing, Embraer), Missiles

 FY2012 （ vs. FY2011 ）（Billion Yen / In accumulated amount）
Orders Received

327.2（Forecast in January 220.0）

283.4

250.0

Orders Received: Decrease in large-scale orders received for Japan Ministry of
Defense (MOD), despite increase in component parts for Boeing 777 and 787
Net Sales: Increased due to sales increase for MOD including C-2 transport aircraft
and component parts for Boeing 777 and 787
Operating Income: Increased significantly due to sales increase, cost reduction< Sales units of c omponent parts for c ommerc ial airc rafts >and other factors(unit)

138.3

114.1
30.6

91.0

67.5

Boeing 777

34.4

Boeing 767
Boeing 787

1Q

2Q

3Q

FY2011

1Q

2Q

206.5

290.0

165.8
109.1

87.4

2Q

FY2013
Forecast

239.1

138.5

1Q

FY2012（Forecast in January 250.0）

Net Sales

40.0

3Q

49.6
3Q

FY2011

1Q

2Q

3Q

FY2012FY2013
Forecast

 FY2013 Forecast （ vs. FY2012 )Embraer170/175
Embraer190/195

FY2011
83
25
29
19
98

FY2012
89
25
54
21
73

Orders received: Expected to decrease due to decrease mainly in orders received
for MODNet Sales: Expected to increase due to sales increase for MOD including C-2
transport aircraft and component parts for Boeing 787
Operating Income: Expected to increase due to sales increase and other factors<For Reference> Present Status of Main Projects
Aircrafts for MOD

Operating Income（Forecast in January 12.0）

19.0

14.8

3.0

1Q

-0.8

2Q

5.9

9.3

7.8
0.8

3Q

FY2011

1Q

4.3

2Q

3Q

FY2012FY2013
Forecast

In March 2013, KHI delivered the first mass production of P-1 patrol aircraft to MOD. KHI issteadily working on the mass production of P-1, as well as C-2 transport aircraft.

Commercial aircrafts
Component parts for Boeing 777- KHI’s production rate for 777 program has increased 7
to 8.3 units per month corresponding to the increase in production rate by the Boeing
Company.
Component parts for Boeing 787- KHI has achieved to deliver the 100th component parts
to Boeing in August 2012 since the first delivery of it in January 2007. KHI has completed the
production system at Kawasaki’s Nagoya Works I for ramp-up production.

© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved

9I. Consolidated Results for FY2012

Gas Turbine & Machinery
Main Products : Jet engines, Gas turbine co-generation system, Gas engines, Diesel engines, Gas turbines & steam turbines for marine & land,
Marine propulsion system, Aero-dynamic machinery FY2012 （ vs. FY2011 )Orders Received: Increase in orders received for component parts of commercial aircraft jetengines
Net Sales: Increased due to sales increase in component parts of commercial aircraft jetengines and sales increase in gas engines, despite decrease in sales of marine diesel engines
Operating Income: Decreased due to allocation of non-recurring cost for new projects andother factors（Billion Yen / In accumulated amount）（Forecast in January 240.0）

Orders Received

255.5

227.2

79.7
32.5

31.3
2Q

3Q

FY2011

1Q

65.4

2Q

3Q

FY2012FY2013
Forecast（Forecast in January 210.0）

Net Sales

207.0

194.6
93.2

84.7
45.5

1Q

185.0

144.6

137.0
45.3

2Q

3Q

FY2011

1Q

2Q

3Q

 FY2013 Forecast （ vs. FY2012 ）Orders Received: Expected to decrease due to the effect of changes in accounting policies
regarding commercial aircraft jet engines sales
Net Sales: Expected to decrease due to the effect of changes in accounting policies regarding
commercial aircraft jet engines sales, despite sales increase due to the depreciation of the
yen

131.6

123.3

1Q

220.0

FY2012

Note : Please see page 9 of Flash Report for the Fiscal Year Ended March 31, 2013 concerning changes in accounting
policies for FY2013 forecast

Operating Income: Expected to increase due to the effect of the depreciation of the yen andother factors<For Reference>
Major Projects for Commercial Aircraft Jet Engines
Trent1000

TrentXWB

AircraftBoeing 787

Airbus A350

Airbus A320neo

Participation TypeRRSP（※)RRSP（※)

International Collaboration Program

FY2013
Forecast（Forecast in January 8.0）

3.3

3.9

1Q

2Q

3Q

Approx. 8.5%

Approx. 7%

Approx. 6%

Intermediate pressurecompressor (IPC) module

Intermediate pressurecompressor (IPC) module

Primary parts of the engine’s fan
and low -pressure compressor

First IPC module shipped to Rolls-Royce inMarch 2011.

Made decision to collaborate in a programfor development and production.
Design w ork in progress.

Development w as completed and mass
production started in FY2010. To bedelivered in accordance with production
schedule of airplanes.

Risk & Revenue Sharing Partner

Preparation for the production for component parts of aircraft jet engines is proceeding at Seishin Work’s
4th plant completed in September 2012.

Operating Income
8.0

Share
Responsible
Components

Present Status（※）

PW1100G - JM

7.7

FY2011

2.6

3.2

1Q

2Q

4.6

3Q

11.0

7.0

FY2012FY2013
Forecast

Energy and Environmental Products

The L30A of 30MW class Gas Turbine, which KHI completed development in February 2012, has been
operating very successfully at its first commercial plant. Also, KHI built an overhaul facility for gas
turbines in Malaysia to enhance its after-sales services.
Meanwhile, the 110MW power plant which consists of 14 units of Kawasaki Green Gas Engines (received
an order in September 2011) started full-scale operation in August 2012. Also, as the first overseas
project, 2 units of gas engines (received an order in December 2011) were delivered for the LNG terminalin Singapore in December 2012.
In addition, KHI established a new organization in April 2013 to enhance its energy solution business.
KHI will actively develop Energy and Environmental business in domestic and overseas markets.

© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved

10

I. Consolidated Results for FY2012

Plant & Infrastructure
Main Products: Industrial plants (cement, chemical and others), Power plants, LNG & LPG tanks, Municipal refuse incineration plants, Shield machines,
Crushing machines

 FY2012 （ vs. FY2011 ）（Billion Yen / In accumulated amount）
Orders Received（Forecast in January 130.0）

119.2

113.6

84.0
46.8

37.1

19.1
1Q

2Q

3Q

FY2011

1Q

51.3

2Q

69.4

 FY2013 Forecast （ vs. FY2012 )3Q

FY2012FY2013
Forecast（Forecast in January 130.0）

Net Sales

122.8

115.8

78.7

115.0

71.1

56.2

46.4

23.8
1Q

130.0

19.8
2Q

3Q

FY2011

1Q

2Q

3Q

FY2012FY2013
Forecast

Operating Income
14.1
6.7

1Q

（Forecast in January 11.0）

9.7

8.8

0.9

0.1
2Q

3Q

FY2011

1Q

Orders Received: Decrease in orders received for domestic projects including LNG
tanks and material handling systems
Net Sales: Decreased due to sales decrease of large-scale overseas projects,
despite sales increase of material handling systems and municipal refuse
incineration plants
Operating Income: Decreased due to sales decrease and decline in profit margin

3.1

3.7

2Q

3Q

FY20127.0

FY2013
Forecast

Orders Received: Expected to increase due to orders received of energy related
projects, and projects related infrastructure for resource-producing countries
Net Sales: Expected to remain at the same level as in the previous fiscal year due
to sales increase in projects related environment and industrial infrastructure,despite sales decrease in large-scale overseas projects
Operating Income: Expected to decrease due to decline in profit margin resulting
from severe competitiveness<For Reference>
Orders Received of Energy and Environmental Projects- In parallel with an expected increase of worldwide energy consumption, a lot of
floating LNG facilities are planned to be constructed. Under these circumstances,
KHI’s proven track record of boilers for land and marine use (more than 1,200
units) and technical capability, which has realized reliable and robust boilers thatcan operate under severe offshore condition, are highly evaluated, and in July
2011, KHI won the contract with Technip to supply 7 units of boilers for the Shell’s
floating LNG facility of “Prelude”, the world’s first floating LNG facility.
- In April 2012, KHI won the contract of 4 massive cryogenic tanks for Ichthys LNG
Project in Australia. This project is very important for Japan in terms of the stablesupply of energy and the decentralization of natural gas supply as approximately
70% of the Ichthys LNG to be delivered to Japan. KHI will support this projectbased on its proven track record and the EPC technologies.

© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved11

I. Consolidated Results for FY2012

Motorcycle & Engine
Main Products: Motorcycles, All-Terrain Vehicles(ATVs), Utility Vehicles, Personal Watercraft, General-purpose Gasoline Engines

 FY2012 （ vs. FY2011 )（Billion Yen / In accumulated amount）（Forecast in January 250.0）

Net Sales

251.8

235.2
158.8

154.2
59.6

1Q

290.0

106.2

Operating Income: Improved due to sales increase, improvement in
profitability and other factors

103.9
53.4

2Q

3Q

FY2011

1Q

2Q

3Q

Net Sales: Increased due to sales increase of motorcycles in United Statesand emerging markets mainly Indonesia, despite sales decrease in European
market

FY2012FY2013
Forecast

 FY2013 Forecast （ vs. FY2012 )Net Sales: Expected to increase due to sales increase in emerging countries,
the depreciation of the yen and other factors

Operating Income
10.0

Operating Income: Expected to increase due to sales increase and otherfactors（Forecast in January 2.0）

2.3

0.3
-2.3
1Q

2Q

-0.3
-4.5
3Q

-2.9
1Q

FY2011

-2.2

-2.0

2Q

3Q

FY2012＜Wholesales by Geografic Area for Consumer Products＞

Domestic
North America (incl. Canada)

EuropeEmerging Countries & Others

Total

FY2013
Forecast(T hous ands of unit / Billion Y en)

FY2011FY2012FY2013 Forecast

Unit
Amount14
12.1
121 (69)
78.0
57
42.2
309
71.0

Unit
Amount14
12.1
118 (74)
79.7
55
38.5
357
86.2

Unit
Amount14
12.1
117 (68)
89.5
56
41.2
433
107.9

501

203.3

544

216.5

620

250.7

N ote: 1 ) Sales units and amount inc lude the following produc ts .
U nits : M otorc yc les , A ll- T errain V ehic les (A T V s ), U tility V ehic les and P ers onal Waterc raft(Jet S ki ®)A mount: T he produc ts mentioned above and parts for thos e produc ts .

<For Reference>
Businesses Development in Emerging Countries- In order to respond to market growth and further to reinforce the business
operation in Asian and other emerging countries, KHI started constructionof the new plant in Indonesia on September 7, 2012. The expansion of theplant in Thailand is proceeding as planned.
- KHI announced the 2013 new models including “Ninja 250/300”,“Ninja ZX-6R” and “Z800”. On August 1, 2012, “Ninja 250/300”, our global
models, were launched in Indonesia, our core market, ahead of othercountries.
- Leisure motorcycle markets in emerging counties are favorable, and sales
in emerging countries in 2012 increased from previous year.

2 ) Figures in the parenthes is ( ) repres ent motorc yc le s ales units .

© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved

12

I. Consolidated Results for FY2012

Precision Machinery
Main Products： Hydraulic components (pumps, motors & valves), Hydraulic systems for industrial use, Hydraulic marine machinery, Industrial Robots

 FY2012 （ vs. FY2011 ）（Billion Yen / In accumulated amount）
Orders Received

174.5

131.1

（Forecast in January 110.0）

109.7

91.1
55.6

43.4

1Q

78.4

 FY2013 Forecast （ vs. FY2012 ）3Q

Orders Received & Net Sales: Expected to increase due to demand
recovery of hydraulic components for construction machinery in emerging
countries mainly in China and industrial robots for manufacturers ofsemiconductor production equipments
Operating Income: Expected to increase due to sales increase and otherfactors

28.6
2Q

3Q

Net Sales

FY2011

175.0

1Q

2Q

85.2

67.0

40.4

FY2013
Forecast

130.4

140.0

FY2012FY2013
Forecast

93.8

36.1

2Q

3Q

Operating Income

FY2011

1Q

7.1

3Q

3Q

（Forecast in January 8.0）

14.5

2Q

2Q

26.6

20.7

1Q

FY2012（Forecast in January 130.0）

129.0

1Q

150.0

Orders Received & Net Sales: Decrease in orders received for and sales ofhydraulic components for construction machinery in emerging countries
mainly in China
Operating Income: Decreased due to decrease in sales, increase in fixed
cost resulting from capital expenditures which were executed past fiscal
years and other factors

FY2011

3.9

4.9

4.8

1Q

2Q

3Q

14.0

8.4

FY2012FY2013
Forecast<For Reference> Businesses Development in Emerging Countries

In August 2006, production of hydraulic pumps started at Chinese subsidiary in Suzhou. Also,in Zhejiang, the joint venture of hydraulic machinery manufacturing was established with aChinese company and production started in April 2010, while the sales subsidiary in Shanghai
provides the products manufactured at the above manufacturing companies to customers
throughout China.
Afterward, KHI reinforced business operation in China through the construction of the newplant at the subsidiary in Suzhou, expansion of the plant in Zhejiang and establishment of thesubsidiary for after-sales service in Shanghai.
For the Chinese construction machinery market, the demand of some small-sized construction
machineries show signs of recovery. However, the demand of medium to large-sized
construction machinery that KHI mainly involves remains at a low level, though it wasbottoming out. But the continued growth of this market over the medium- to long-term is
expected as construction of housing for low-income families and energy-and transportationrelated infrastructure projects still likely to go forward.
Meanwhile, spurred by a rapidly growing economy, India's hydraulic excavator market isbooming. In order to cater to the growing demand for local production, in February 2012,KHI
set up the joint venture with Wipro Limited in Bangalore for manufacture, sales, and servicing
of hydraulic components for construction machinery.

© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved

13

I. Consolidated Results for FY2012

Financial Condition and Cash Flows【Financial Condition】(Billion Yen)FY2011
End of March 2012

Total Assets

FY2012End of March 2013

1,362.1

1,466.2

306.0

338.2

(22.4%)(23.0%)

Interest-bearing debt

407.1

484.6

（Net Interest-bearing debt）(372.8)(446.1)121.8%

131.9%

Shareholders’ Equity（Ratio of shareholders’ equity to total assets）

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

FY2011FY2012

Cash flows from operating activities

84.7

28.1

Cash flows from investing activities- 65.9- 81.118.7- 53.0- 26.8

57.6

Free Cash Flows
Cash flows from financing activities© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved

14II． Forecast for FY2013

Consolidated Operating Performance(Billion Yen)FY2012
Actual

FY2013
Forecast

Changevs. FY2012< Orders Received >Orders Received

1,369.5

1,450.0+ 80.5Net Sales

1,288.8

1,380.0+ 91.2

Expected to increase as a whole due to increase inorders received in Rolling Stock, Precision Machinery andMotorcycle & Engine segments, despite decrease in
Aerospace segment

Operating Income

42.0

60.0

+ 18.0< Net Sale >Recurring Profit

39.3

53.0

+ 13.7Net Income

30.8

34.0

+ 3.2

Note1 : Please see page 9 of Flash Report for the Fiscal Year Ended March 31, 2013
concerning changes in accounting policies for FY2013 forecast

Exchange Rates (actual & assumed)

Yen / US$

82.86

95

Yen / EUR

107.76120

Expected to increase as a whole due to sales increase in
Aerospace, Rolling Stock and Motorcycle & Engine
segments, despite sales decrease in Ship & Offshore
Structure segment< Profits >Expected to increase by continuing to pursue ongoing
initiatives to improve earnings across all operations
through such means as reducing fixed and overhead
costs and boosting productivity

Note2 : Assumed rates are applied to the outstanding foreign exchange exposure as of April 25, 2013(For Reference)

Impact on profit by FX fluctuation of 1 Yen(Billion Yen)

US$
EUR

Operating
Income1.9
0.3

Recurring
Profit0.8
0© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved

15II． Forecast for FY2013

Forecast by Segment(Billion Yen)

Orders Received

Net Sales

Operating Income

FY2012FY2013

ChangeFY2012FY2013

ChangeFY2012FY2013

ChangeShip & Offshore Structure

105.7

120.0

+ 14.390.3

70.0- 20.3

4.1

0

- 4.1

Rolling Stock

124.4

160.0

+ 35.6

129.9

155.0

+ 25.1

2.2

6.0

+ 3.8

Aerospace

283.4

250.0

- 33.4

239.1

290.0

+ 50.9

14.8

19.0

+ 4.2

Gas Turbine & Machinery

255.5

220.0

- 35.5

207.0

185.0

- 22.0

7.0

11.0

+ 4.0

Plant & Infrastructure

113.6

130.0

+ 16.4

115.8

115.0

- 0.8

9.7

7.0

- 2.7

Motorcycle & Engine

251.8

290.0

+ 38.2

251.8

290.0

+ 38.2

2.3

10.0

+ 7.7

Precision Machinery

109.7

150.0

+ 40.3

130.4

140.0

+ 9.6

8.4

14.0

+ 5.6

Others

125.1

130.0

+ 4.9

124.2

135.0

+ 10.8

1.2

3.0

+ 1.8

-

-

-

-

-

-

- 8.0

- 10.0- 2.0

1,369.5 1,450.0+ 80.5

1,288.8 1,380.0+ 91.242.0

60.0+ 18.0Eliminations and corporate
Total

Note : “Eliminations and corporate” includes some expenses incurred at Head Office which are not allocated to each industry segment for internal reporting© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved

16II． Forecast for FY2013

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

FY2011
Actual

FY2012
Actual

FY2013
Forecast

R&D Expenses

39.9

41.7

44.0

CAPEX
(Construction Base)

63.9

78.6

84.0

Depreciation & Amortization

48.9

48.3

43.0

Domestic

24,77025,22225,700Overseas

8,497

8,788

9,200

33,26734,01034,900

Number of Employees© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved

17Figures recorded in the business forecasts are forecasts that reflect the judgment of the Company based on theinformation available at the time of release and include risks and uncertainties. Accordingly, the Company cautions
investors not to make investment decisions solely on the basis of these forecasts.
Actual business results may differ materially from these business forecasts due to various important factors resulting
from changes in the external environment and internal environment. Important factors that may affect actual
business results include, but are not limited to, economic conditions, the yen exchange rate against the U.S. dollar
and other currencies, the tax system, and laws and regulations.

© 2013 KAWASAKI HEAVY INDUSTRIES, LTD. All Rights Reserved

18