Financial Results for the First Quarter
Fiscal Year Ending December 2015
Investor Relations Presentation Materials
ISEKI & CO., LTD.

Susumu Tada,
Director & Senior managing executive officer
August 7, 2015

Index

1. Outline of Financial Results for the First Quarter
Fiscal Year Ending December, 2015
2. Recent Development in Domestic and Overseas
Markets
3. Performance Forecast for the Fiscal YearEnding December, 2015
4. Topics

ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

2

Revision of Fiscal YearThe fiscal-year (the last day of a fiscal year) changes to the end of December■ As a transitory treatment, results in the following period are consolidated

for fiscal 2015;a) Companies that have adopted December 31 as the fiscal year-end(Domestic sales companies, etc.) : 12-month results (From Jan. to Dec. 2015)b) Companies that have adopted March 31 as the fiscal year-end(ISEKI CO., LTD, etc.) : 9-month results (From Apr. to Dec. 2015)
Jana) Companies that have adopted Dec.31
as the fiscal year-end

Domestic sales companies
and others

Feb

1Q

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

2Q

3Q

4Q

1Q

2Q

3Q

1Q

2Q

Full Year End

a Jan.- Mar.
b Apr.- Jun.

a Jan.- Jun.
b Apr.- Sep.

a Jan.- Dec.
b Apr.- Dec.

b) Companies that have adopted Mar.31
as the fiscal year-end

ISEKI & CO.,LTD
and others

Consolidated Financial results(Accumulated)

ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

33

Points of Attention of 1st Quarter financial Results
 1st Quarter consolidated period :- Companies that have adopted Dec.31 as the fiscal year-end(Domestic sales companies, etc.): Jan.-Mar., 2015
- Companies that have adopted Mar. 31 as the fiscal year-end(ISEKI & CO., LTD., etc.): Apr.-Jun., 2015

 Special notes regarding net sales :(JPY bn)

Domestic 1st Quarter Net Sales

1. Domestic sales
Net sales increased substantially during the 1stquarter of the previous year due to last-minutedemand before consumption tax hike.

Fiscal year

2. Overseas sales

Net Sales (JPY bn)

FY ended FY ended FY ended FY ended FY ending
Mar./12Mar./13Mar./14Mar./15
Dec./15
26.4

29.7

29.1

43.5

26.5

• Europe: The results of ISEKI France from Jan.to Mar. are newly consolidated.
• China: Chinese subsidiary ,which was consolidated in the 1st quarter of the previous year, has been
excluded from consolidation.

ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

4Outline of Financial Results of the First Quarter
Fiscal Year Ending December, 2015

(Billions of yen)

Net Sales(Years ended March 31)
ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

5Outline of First Quarter Business Performance(JPY bn, %)

Item

1Q of
FY endedMar./15

1Q of
FY endingDec./15%

yoy
Change%

1Q of
FY endingDec./15
TargetDiff.
(target/actual)

49.2

100.0

34.2

100.0

(15.0)

33.4

0.8(Domestic)

43.5

88.3

26.5

77.5

(17.0)

26.4

0.1(Overseas)

5.7

11.7

7.7

22.5

2.0

7.0

0.7

Operating Income

2.0

4.0

0.3

0.8

(1.7)

0.4

(0.1)

Ordinary Income

1.8

3.7

0.4

1.1

(1.4)

0.3

0.1

Profit attributable to ownersof parent

1.3

2.5

0.1

0.4

(1.2)

0.1

-

Net Sales

Note: Cumulative total : Jan.-Mar. (Domestic sales companies, ISEKI France, etc.)
Cumulative total : Apr.-Jun. (ISEKI&CO.,Ltd, Domestic manufacturing companies, etc.)* 1st Quarter Dec./15 Average actual forex rate :¥119 to the US$, ¥130 to the EuroISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

6Breakdown of Domestic Sales(JPY bn, %)Agricultural Machinery

Agriculture Related Business

1Q of
FY endedMar./15

1Q of
FY endingDec./15

yo yChangeNote

1Q of
FY endingDec./15
TargetDiff.
(target/Actual)Cultivating &Mowing Machinery

11.6

7.3

(4.3) Tillers:(0.3)

Tractors: (3.9)

7.2

0.1

Planting Machinery

3.6

2.6

(1.0) Rice transplanters:(0.9)

2.6-

Combineharv esters:(2.7)
Dry ing machines:(0.5)

3.0-

Harvesting &Processing
Machinery

6.7

3.0

(3.7)

Total

21.9

12.9

(9.0)

12.8

0.1

Farming Implements

7.1

4.0

(3.1)

4.0

-

Parts

3.3

2.5

(0.8)

2.5

-

Construction of Facilities

2.7

0.3

(2.4)

0.3

-

Other Agriculture Related

8.5

6.8

(1.7)

6.8

-

Total

43.5

26.5

(17.0)

26.4

0.1

ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

7Breakdown of Overseas Sales(JPY bn)
1Q of
FY endingDec./15
Target

1Q of
FY endedMar./15

1Q of
FY endingDec./15

yoy
ChangeNorth America

2.1

2.4

0.3

Europe2.1

3.8

1.7 Lawn mowers: +1.5

China*

0.6

0.2(0.4) Others: +0.1

Asia except China

0.2

0.5

Oceania

0.1

0.1

Products Total

5.1

7.0

1.9

6.1

0.9

Parts & Others

0.6

0.7

0.1

0.9

(0.2)

Total

5.7

7.7

2.0

7.0

0.7

Note

Diff.
(target/actual)Tractors: +0.3

1.9

0.5

Tractors: +0.2

3.5

0.3

Rice transplanters: (0.5)

0.1

0.1

Tractors: +0.2
transplanters, etc.:
0.3 Rice
+0.1

-

0.5

-

0.1

-

•Note: Europe: The results of ISEKI France from Jan.-Mar. are included.
China: The results of the local subsidiary have been excluded.

ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

8Gross Income and Operating Income(JPY bn, %)

Item

1Q of
FY endedMar./15

1Q of
FY endingDec./15%

yoy
Change

1Q of
FY endingDec./15
TargetDiff.
(target/actual)%Net Sales

49.2

100.0

34.2

100.0

(15.0)

33.4

0.8

Gross Profit

13.3

27.1

11.4

33.3

(1.9)

11.7

(0.3)

S. G. & A. Expenses

11.3

23.1

11.1

32.5

(0.2)

11.3

(0.2)

Operating Income

2.0

4.0

0.3

0.8

(1.7)

0.4

(0.1)

[Factors of year-on year change][Gross Profit]• Decreased gross profit due to a decline in sales• Increased gross profit thanks to growth in sales of domestic
agricultural machinery from Apr. - Jun.
• Others [Reduced personnel expenses, etc.][Operating Income] • Decreased S.G.&A. expenses (Reduced personnel expenses, etc. )ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials: (2.6): +0.5: +0.2(1.9): +0.2(1.7)
9

Ordinary Income and Net Income(JPY bn, %)1Q of
FY endedMar./15

1Q of
FY endingDec./15

1Q of
FY endingDec./15

yoy
ChangeTargetDiff.
(target/actual)Operating Income

2.0

0.3

(1.7)

0.4

(0.1)

Balance of Financial Income

(0.2)

(0.2)

-

(0.2)

-

Other Non-operating Income

0

0.3

0.3

0.1

0.2

Ordinary Income

1.8

0.4

(1.4)

0.3

0.1

Extraordinary Income

0.6

0.2

(0.4)

0.2

Extraordinary Losses

0

0

-

(0.1)

0.1

Income before Income Taxes

2.4

0.6

(1.8)

0.4

0.2

Taxes, Deferred Taxes

(1.1)

(0.5)

0.6

(0.3)

(0.2)

Profit attributable toowners of parent

1.3

0.1

(1.2)

0.1

-

-

[Factors of year-on year change][Other Non-operating Income]

Foreign exchange gains, etc: +0.3[Extraordinary Income/Losses]

Gain on sales of investment securities: +0.2

Decreased gain on changes in equity (Chinese subsidiary): (0.6)

ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

10Balance Sheet(JPY bn, %)Item

As of Jun./14

As of Jun./15

Cash/Deposits

9.8

8.2

(1.6)

6.6

Accounts Receivables

34.3

36.0

1.7

30.4

Inventories

41.8

50.8

9.0

47.7

(Product Inventory)

25.1

31.8

6.7

30.8

Other Current Assets

4.1

4.8

0.7

7.1

Noncurrent Assets

106.1

112.9

6.8

112.3

Total Assets

196.1

212.7

16.6

204.1

Accounts Payables

46.1

40.4

(5.7)

38.7

Debts/Bonds

46.9

67.6

20.7

57.6

Other Liabilities

34.4

34.1

(0.3)

36.7

(Total Liabilities)

127.4

142.1

14.7

133.0

Net Assets

68.7

70.6

1.9

71.1

(Retained Earnings)

17.2

15.1

(2.1)

15.7

Total Liabilities and Net Assets

196.1

212.7

16.6

204.1

ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

ChangeAs of Mar./15

11

Recent Development of Domestic andOverseas Markets

New compact tractor for domestic market
Z15 (15.8PS)
ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

Trends in Domestic Agricultural Machinery Market
Demand for Agricultural Machinery[Industry shipment]
9 principal products・Moving annual total

Off-road vehicle exhaust emission regulation in Japan (3rd phase)102-117PS(JPY bn)
550

76-102PS

50-76PS

26-50PS

500
450

consumption tax rate hike

400
350
300
250

FY2011FY2012FY2013

Note: The above chart partially includes our estimation.
ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

FY2014

Oct‐Dec

2015
年度

Jul‐Sep

Apr‐JunJan‐MarOct‐Dec

2014
年度

Jul‐Sep◆ Reactionary
decline to lastminute demand◆ Declined rice
price

Apr‐JunJan‐MarOct‐Dec

2013
年度

Jul‐Sep

Apr‐JunJan‐MarOct‐Dec

2012
年度

Jul‐Sep

2011
年度

Apr‐Jun00- Exhaust emission
regulation- Consumption tax
rate hike

Jan‐Mar50◆ Last-minutedemand◆ Declined rice
price due toheat summer

Oct‐Dec100

Jul‐Sep

150◆ Great EastJapan
Earthquake

Apr‐Jun200

FY2015

Source: Shipment Statistics from JFMMA
13

Industry Shipments and Our Sales Result

Growth rate of 9 principal products (year-on year)
Unit：%
Jun./11 Jun./12 Jun./13 Jun./14 Jun./15

Industry Value of Shipments
ISEKI

Value of Sales

92 104 107 117

70

96 105 102 107

84

Note: The value of shipments on the above was calculated according to our standard.

ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

14

1st STAGE

2nd STAGE

Jun. 2014

3rd STAGE

For Large-Scale Farming

Special machines

90th anniversary commemorative machines

Our Engagement - New Product Launch -Vegetable-Related Machinery

Dec. 2014
ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

Jun. 201515

Recent Market Trend in Overseas（JPY bn）

300
250
FY Dec./15 FORCAST(Announced on
May 14th )

200
150

* FY Dec./15

Orders Received

FY Mar./15 RESULT100

JPY 23.1 billion

50
0
Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Jan

Feb

Mar

* Note: Shipment result (from Apr.- Jun.) + Orders received (from Jul.-Oct.)

The results of “Parts & Others” are not included.

ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

16Market Trend in North America
1. Market in North America
Category (PTO hp)

Unit: 1,000

Compact Tractors (40hp or below)
USA

CanadaUSA

Jan.-Jun. 2014

59

7

Jan.-Jun. 2015

62

7

104%

96%

Growth rate

Utility Tractors (40hp or above、 100hp or below )

66
69
104%

Canada
29

3

29

3

99%

86%

32
32
98%

Source: Association of Equipment
Manufacturers statistics
Figures have been rounded and non-adjusted.

2. Our situation
Net sales in North America

Shipment/ Orders received (Apr. - Oct.) :Up from last year

[Forecast]

Unit sales (Jan.-Jun.) [OEM partner] :Compact: Up from last year
Utility : Down from last year
(Our utility tractor line: Up from last year)

Achieve our sales plan by enriched line-up of
economy tractors and full-fledged sales efforts.

FY ended Mar./15

ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

FY ending Dec./15

17Market Trend in Europe
1. Market in Europe
European economy: While gradual economic recovery continues in the market,
future economy still remains uncertain due to matters of concern
such as the Greek debt crisis.

2. Our situation

Net sales in Europe

Shipment / Orders received (Apr. - Oct.) :Up from last year

[Forecast]

Unit sales (Jan.-May.) [Distributors] :Up from last year
ISEKI France : Favorable trend continues
exceeding both previous year and the plan.
FY ended Mar./15

FY ending Dec./15

Expand sales through active sales promotion of
new products, 90th anniversary campaigns, etc.
as well as full-fledged operation of ISEKI France.
ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

18Market Trend in ASEAN
1. Market in ASEAN countries

Thailand: Demand declined due to drought along with the stagnant economy.
Indonesia: Market demand expected to rise by Indonesian government tenders.
2. Our situation

 Thailand: New products received positive feedback in the market
Continue expanding distributors’ network.
 Indonesia:
Production : Expand production models and volume
Sales : Promote Indonesian government tenders

ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

19Market Trend in China
1. Market in China
 Central government subsidy(billion of yuan)

2015

2008

2009

2010

2011

2012

2013

2014

4.0

13.0

15.5

17.5

21.5

21.8

17.0 1st period 21.0
23.8 Annual 25.6 [Forecast]

2. Our Situation

Net / Effective Sales in China(JPY bn)

Total Chinese business(incl. equity)

[5.6]

6

[Forecast]

Unit sales of Dongfeng Iseki (Jan.-Jun.) : Rice transplanters (Walk-behind/Ride-on):

5
4

3.1

Up from last year

Donfeng ISEKI

3

 Combine harvesters: Got off to a good start2
1

Grow sales by sales expansion of combine
harvesters during demand season
and launch of new products such as tractors.

1.3

1.1

0.7

0.6
0.1

0
1Q

0.3

2Q
3Q
FY ended Mar./15

ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

0.7
4Q

0.2

[0.5]

1Q
2Q
3Q
FY ending Dec./15

20China - Construction of New Plant Expand production scale to grow Chinese business[ Outline ]Production
machinery
Production
capacity

Ride-on rice transplanters, all-purpose
combine harvesters, tracters, etc.

Site area

Approx. 380,000 m 2Investment
amountStart ofoperation

Approx. 9 billion yen(Approx. 450 million yuan)

Approx. 50,000 units/ year

Planed in November, 2016

Besides in Chinese market,
export machinery to neighboring
ASEAN nations.
Exterior image

Moving into the next phase
ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

21Performance Forecast For the Fiscal YearEnding Dec., 2015

New Compact Tractor for Domestic Market“GEAS NTA3 Series” (25- 60PS)

ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

Performance Forecast for FY ending Dec./15- Consolidated period 1. Consolidated period• 2nd quarter : As in the past
• Full year end : As a transitory treatment,
the results will be consolidated into 9 months

Domestic sales companies
and others
Companies that have adopted
Dec.31 as the fiscal year-end

ISEKI & CO.,LTD
and others
Companies that have adopted
Mar.31 as the fiscal year-end

2nd quarter cumulative

Full year

6 months(Jan.-Jun.)

12 months(Jan.-Dec.)

6 months(Apr.-Sep.)

12 months(Apr.-Dec.)

2. Comparison with the previous term
In order to make year-on year comparison, the results for the fiscal year ended
Mar./15 will be restated on the comparable period basis.

ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

23Performance Forecast for FY ending Dec./15
1. Performance forecast(JPY bn)
FY endingDec./15
Forecast *2

FY endedMar./15
ActualItem

1st half

Full year *1

1st halfyoyChangeFull year

1st half

Full year

Net Sales

82.4

145.7

78.0

152.0

(4.4)

6.3

Operating Income

1.0

(0.3)

1.8

3.9

0.8

4.2

Ordinary Income

1.5

1.0

1.7

3.7

0.2

2.7

Profit attributable to owners ofparent

1.3

0.9

2.1

(0.4)

Note: Company forex rate: ¥115 to the US$ ¥130 to the Euro
*1 FY ended Mar./15 restated*2 Not revised to the previous forecast announcement on May 14

2. Year-End Divided Forecast(Yen)Mar./15

Dec./15 Plan

3.0

3.0
ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

24Topics

New Rice Transplanter
w/ Diesel Engine
NP50D, 70D (5, 7raw planting)
ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

Topics
 Top ranked patent allowance rate in Japan! Open patents per
specialty field ranked 1st for 14 years running (Announced in June)[2015 Annual Report on Patent Policy, Patent Office]Patent allowance rate in 2014: Ranked first (Patent allowance rate: 99.2%)

Open patents per specialty field in 2013:
Ranked first (the other special machinery sector)

 Tractor “Shiro Petit” model Z15 released in June!
[Developed for women farmers, designed from a woman’s point of view]

Minister Hayashi and Vice-Minister Abe of MAFF showed up to our ProductPresentation Meeting.

Overseas local subsidiaries have shownstrong interest on the product.

Debut at the Product Presentation Meeting on June 9
ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

26Topics
 China: Groundbreaking ceremony of new plant andFirst shipment ceremony of export products held in July

Groundbreaking ceremony of new plant/
First shipment ceremony

Long line of trucks waiting for departure

The Representative Office in China to be establishedTime of establishment: Planned in September, 2015
(Establishment Preparation Room already set up on August 1st ) Location: Wuhan City, Hubei Province Purposes: Information collection of Chinese market andreinforcement of tie-ups with Dongfeng Iseki

ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

27

Notes on the Future Forecast• The objective of this presentation document is to provide information, and it is not intended toinvite any action.
• The document has been prepared by ISEKI based on currently available information and it
involves potential risks and uncertainties. The forecast may not be consistent with actual results
depending on fluctuation of the economic situation and market trends.
• In using this information, investors are expected to depend on their own judgment. ISEKI is notliable for any losses incurred by investment decision made utilizing the business forecast or
targets given in this document.

Increase food self sufficiency ratio 1% campaign which leads to relief in the future

Yum-Yum NIPPONISEKI group is a partner of FOOD ACTION NIPPON.
ISEKI 1Q FY ending Dec./15 Investor Relations Presentation Materials

28