Kurita Water Industries Ltd.
Results Presentation
for the Year Ended March 31, 2013
( Stock code : 6370 )May 2, 2013

Table of Contents
Ⅰ Consolidated Financial Results for the Fiscal Year Ended March 31, 2013
Ⅱ Consolidated Business Plan for the Fiscal Year Ending March 31, 2014
Ⅲ Initiatives of Medium-term Management Plan ―“Take Action 2014 (TA -14)”
Reference Material

Consolidated Financial Results for the Fiscal Year Ended March 31, 2013

1 . Financial Highlights
2 . Orders, Sales, Operating Income, and Operating Income Margin
3 . Water Treatment Chemicals
4 . Water Treatment Facilities (for the electronics industry)
5 . Water Treatment Facilities (for general industries)
6 . Financial Condition

Ⅰ. Consolidated Financial Results for the Fiscal Year Ended March 31, 2013

1. Financial Highlights(Billions of Yen)
Fiscal year to
March 2012
ActualFiscal year to
March 2013
ActualYear-on-yearchangeRevised
Projections

InitialProjections

Orders

197.3

186.7

- 5.3%

198.0

201.0

Net Sales

193.8

180.1

- 7.0%

196.0

200.0

Operating
Income29.4

21.0- 28.6%

25.0

29.5

Ordinary
Income30.4

22.0- 27.4%

25.7

30.0

Net Income

16.5

11.5

- 30.7%

13.6

17.5

1Ⅰ. Consolidated Financial Results for the Fiscal Year Ended March 31, 2013

2. Orders, Sales, Operating Income, and Operating Income Margin
Water treatment chemicals

Water treatment facilities

Total*Orders(Billions of Yen)
200Sales
Sales

197.3

186.7 198.0

56.7

56.0

193.8
56.4

140.5

130.7 140.8

03/201203/20130(%)
1829.49.3

1556.1

57.1

21.0

25.0

8.3

9.0

137.3

124.1 138.903/2012

03/2013

Operating Income Margin
16.4
15.2
14.7

12.603/2012

03/201314.9 15.8

1311.7 12.8
10.2 11.5

20.1
0180.1 196.0

100

Operating Income(Billions of Yen)
30

(Billions of Yen)
20057.2

1000

denotes revised projections

16.0803/201203/2013
2

Ⅰ. Consolidated Financial Results for the Fiscal Year Ended March 31, 2013

3. Water Treatment Chemicals
Orders*Operating Income andOperating Income MarginSales

denotes revised projections*

denotes revised projections*

Operating income
Operating income margin
denotes revised projections(Billions of Yen)

(Billions of Yen)

(Billions of Yen)

60

60

10(%)

16.4

18

14.9 15.8

30

056.7

56.0 57.2

03/201203/201330

056.4

56.1 57.1

03/201203/2013[Major areas of change in Orders / Sales] Japan : Decline primarily in core products (-)
 Overseas : Growth primarily in Asia (+)

50

9.303/2012

98.3

9.003/2013

0[Major determinants of change] Increase in SG&A expenses (-)
 Change in sales mix (-)

3

Ⅰ. Consolidated Financial Results for the Fiscal Year Ended March 31, 2013

4. Treatment Facilities (for the electronics industry)
Orders*Operating Income andOperating Income MarginSales

denotes revised projections*

denotes revised projections*

Operating income
Operating income margin
denotes revised projections(Billions of Yen)

(Billions of Yen)

(Billions of Yen)

909016(%)

19.1

20

15.7 15.9

450

84.3

45

75.4 84.4

003/2012

03/2013[Major areas of change] Decrease in hardware (-)
 Decrease in maintenance services (-)
 Decrease in ultrapure water supply
business (-)

79.603/2012

873.3 82.003/2013[Major areas of change] Decrease in maintenance services (-)
 Decrease in ultrapure water supply
business (-)
 Decrease in hardware (-)

1015.2

11.5 13.0003/2012

03/20130[Major determinants of change] Impact of decline in revenue (-)
 Change in sales mix (-)
 Increase in SG&A expenses (-)

4

Ⅰ. Consolidated Financial Results for the Fiscal Year Ended March 31, 2013

5. Treatment Facilities (for general industries)
Orders*Operating Income andOperating Income MarginSales

denotes revised projections*

denotes revised projections*

Operating income
Operating income margin
denotes revised projections(Billions of Yen)

(Billions of Yen)

(Billions of Yen)

60

60

630

56.2

55.3 56.4

30

57.7(%)

108.6

350.7 56.9

54.9
2.2 5.2
1.10003/201203/201303/2012[Major areas of change in Orders / Sales] Increase in general industries hardware (+)
 Decrease in electric power industry (-)
 Decrease in maintenance services (-)

03/2013003/2012

3.003/2013

0[Major determinants of change] Impact of sales decline (-)
 Change in sales mix (-)
 Increase in SG&A expenses (-)

5

Ⅰ. Consolidated Financial Results for the Fiscal Year Ended March 31, 2013

6. Financial Condition
AssetsLiabilities and Net Assets(Billions of Yen)

271.1
69.4

271.1

263.6

77.0
(+ 7.6)75.6(Billions of Yen)

69.8

Cash, deposits
andMarketablesecurities

61.1

263.6
54.5

Liabilities(- 6.7)

Other current
assets(- 5.7)

210.0
98.4

86.9

209.1

Net assets

Tangible fixed
assets(- 11.5)

27.8
Mar. 31, 201229.9(+ 2.1)Mar. 31, 2013

Other fixed
assets(- 0.9)Mar. 31, 2012

Mar. 31, 20136

Consolidated Business Plan for the Fiscal Year Ending March 31, 2014
1 . Key Assumptions
2 . Overview
3 . Orders, Sales, Operating Income, and Operating Income Margin
4 . Water Treatment Chemicals
5 . Water Treatment Facilities (for the electronics industry)
6 . Water Treatment Facilities (for general industries)
7 . Service Business Revenue
8 . Overseas Businesses
9 . Ultrapure Water Supply Business10 . Capital Expenditures, Depreciation, and R&D Expenses
11 . Dividend Policy

Ⅱ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2014

1. Key Assumptions
Water Treatment Chemicals Segment
 Domestic customers’ capacity utilization will gradually
recover from the summer months onward
 Firm overseas demand, particularly in emerging countries

Water Treatment Facilities Segment
 Capital investment in semiconductors/LCD will vary
according to product and customer Capital investment in general industries will be largely
unchanged7Ⅱ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2014

2. Overview(Billions of Yen)

Fiscal year toMarch 2013
ActualFiscal year toMarch 2014
Projection

Year-on-yearchange

Orders

186.7

197.0+ 5.5%

Net Sales

180.1

191.0+ 6.0%

Operating Income

21.0

23.5+ 12.0%

Ordinary Income

22.024.0+ 8.9%

Net Income

11.514.0+ 22.0%

8

Ⅱ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2014

3. Orders, Sales, Operating Income, and Operating Income Margin
Water treatment chemicals

Water treatment facilitiesOrders(Billions of Yen)
200

Sales

186.7

197.0

56.0

60.8

1000

130.7

136.203/2013
Actual03/2014
Projection

21.0
8.3

23.50(%)
17180.1

191.0

56.1

60.8

124.1

130.203/2013
Actual03/2014
Projection

Operating Income Margin
16.3
14.9

9.9
13120

(Billions of Yen)
200

100

Operating Income(Billions of Yen)
24

Total

12.6

13.6

03/2013
Actual03/2014
Projection

11.7
10.2
903/2013
Actual12.3
10.4
03/2014
Projection

9Ⅱ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2014

4. Water Treatment Chemicals
OrdersOperating Income andOperating Income Margin

Sales

Operating income
Operating income margin(Billions of Yen)

(Billions of Yen)

6060

30056.003/2013
Actual60.803/2014
Projection

300(Billions of Yen)

16.3

10(%)

18

14.956.103/2013
Actual60.8

59.9

98.303/2014
Projection[Major areas of change in Orders / Sales] Japan : Recovery from the summer months onward, primarily in core products (+)
 Overseas : Growth primarily in Asia (+)

003/2013
Actual03/2014
Projection0[Major determinants of change] Impact of increase in revenue (+)
 Improvement in sales mix (+)
 Increase in SG&A expenses (-)

10Ⅱ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2014

5. Treatment Facilities (for the electronics industry)
OrdersOperating Income andOperating Income Margin

Sales

Operating income
Operating income margin(Billions of Yen)

(Billions of Yen)

80

80

400

75.4

80.1

03/2013
Actual03/2014
Projection

400(Billions of Yen)

1473.303/2013
Actual

[Major areas of change in Orders / Sales] Increase in hardware (+)
 Increase in maintenance services (+)
 Decrease in ultrapure water supply business (-)

79.503/2014
Projection

(%)

15.7

15.2

11.5

12.0

03/2013
Actual03/2014
Projection701890[Major determinants of change] Impact of increase in revenue (+)
 Change in sales mix (-)

11

Ⅱ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2014

6. Treatment Facilities (for general industries)
OrdersOperating Income andOperating Income Margin

Sales

Operating income
Operating income margin(Billions of Yen)

(Billions of Yen)

(Billions of Yen)

(%)

60

60

24

3.1
2.2
30

55.3

56.1

30

1

50.7

250.7

1.6
1.1

003/2013
Actual03/2014
Projection[Major areas of change] Increase in maintenance services (+)
 Decrease in general industrieshardware (-)

003/2013
Actual03/2014
Projection[Major areas of change] Increase in general industries hardware (+)
 Increase in maintenance services (+)
 Decrease in electric power industry sales (-)

003/2013
Actual03/2014
Projection0[Major determinants of change] Improvement in sales mix (+)
 Increase in SG&A (-)

12

Ⅱ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2014

7. Service Business Revenue
Water treatment chemicals

Service Business Revenue
in the Water Treatment Facilities Segment

Water treatment facilities (services)
Water treatment facilities (hardware)(Billions of Yen)
100

98.4

100.5
96.1
90.3

(Billions of Yen)
200

193.8

191.0

181.2

178.5

34.6

180.1

34.8
31.6

Ultrapurewater supply
business

8.7

Toolcleaning

49.4

52.5

Maintenance,etc.

03/201303/2014
Projection

35.1
32.4

56.4
56.7

53.7

60.8

56.1

10.2
157.0

100.5
98.4

96.1

153.6

146.4

152.8

152.1

100

92.8

90.3

9.3
9.7

8.5

50

92.8
Servicebusiness
revenue

26.4

28.4

36.7

33.6

37.4

03/201003/201103/201203/201303/2014
Projection

53.6

51.3

03/201003/201156.4

00

03/2012

13

Ⅱ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2014

8. Overseas Businesses
Sales by Region

Sales by Overseas Business Segment
Water treatment chemicals

Asia

N. America

EuropeOther

Water treatment facilities(Billions of Yen)

41.0

(Billions of Yen)

40

3.3
1.6
3.0

40

29.3
26.4

20

19.0

3.1
1.3
2.8

3.0
1.4
2.3

41.0

30.5

29.3

3.0
1.2
2.3

15.5

26.4
11.5
20

2.6
1.4
1.6

30.5

19.0

12.0

10.9

33.1
9.4
19.2

22.5

25.6

23.9
15.5

13.4

17.8

18.5

03/201203/20139.6003/2010

03/201103/201203/201303/2014
Projection003/201003/2011

03/2014
Projection

14

Ⅱ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2014

9. Ultrapure Water Supply Business
Sales

Capital Expenditures(Billions of Yen)

(Billions of Yen)

40

620

3

34.6

35.1

34.8

32.4

5.7

5.3

31.6
3.9
3.2
1.4

003/2010

03/201103/201203/201303/2014
Projection

003/2010

03/201103/201203/201303/2014
Projection15

Ⅱ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2014

10. Capital Expenditures, Depreciation, and R&D Expenses
Capital Expenditures and Depreciation

Capital expenditures(ultrapure watersupply business)Capital expenditures(excl. ultrapure
water supply business)

R&D Expenses

Depreciation

R&D Expenses

Percentage of net sales(Billions of Yen)

(Billions of Yen)

(%)

16

6.0

3.0

2.4

2.4

2.2

8

7.7

15.4

5.3

3.0

6.1 14.5
3.2

1.5

14.4

4.0

4.2

4.4

4.503/2012

03/201303/2014
Projection

1.40

2.4

2.9

2.603/2012

03/201303/2014
Projection

0.0

0.0
16

Ⅱ. Consolidated Business Plan for the Fiscal Year Ending March 31, 2014

11. Dividend Policy
(Yen)
5032
2825

2218+434+236+238+240+24442+2+2+6+4+20

03/2005

03/2006

03/2007

03/2008

03/2009

03/201003/201103/201203/201303/2014
Projection

Basic Dividend Policy
Kurita’s basic policy is to maintain stable dividends, and the company will work to increase
dividends while giving due consideration to trends in results and investments in its businesses.
17

Initiatives of Medium-term Management Plan ―“Take Action 2014 (TA-14)”

1 . Basic Theme and Medium-term Vision
2 . Operating Performance Targets
3 . Segment Projections
4 . Overseas Business Growth [Bolster Foundation]
5 . Unparalleled reliability and Market Share Growth in Domestic Business6 . Creation of New Products and New Businesses [Key Themes]
7 . Creation of New Products and New Businesses [Strategic Products]
8 . Improve Capital Efficiency
9 . Enhance Corporate GovernanceⅢ. Initiatives of Medium-term Management Plan ―“Take Action 2014 (TA-14)”

1. Basic Theme and Medium-term Vision
Basic Theme :Execution and Evolution

Mobilize
Kurita Group'sStrengths

Maintenance

Resolve
Customers'
IssuesChemicals
HardwareDramatic overseas
business growth

Enhance earnings
base of domestic
business

18

Ⅲ. Initiatives of Medium-term Management Plan ―“Take Action 2014 (TA-14)”

2. Operating Performance Targets(Billions of Yen)
Fiscal year to
March 2013
ActualFiscal year to
March 2015
Revised Projections

Fiscal year to
March 2015
Initial Projections

Orders

186.7

210.0

240.0

Net Sales

180.1

205.0

235.0

Operating Income

21.0

30.0

36.0

Ordinary Income

22.0

30.5

36.5

Net Income

11.5

18.5

22.0

Net Sales (overseas)

30.5

55.0

64.4

Overseas Sales Ratio

16.9%

26.8%

27.4%

 Recovery of Profitability (Maintain operating income margin around the target of 15%)
 Maintain Overseas Sales Growth (Keep overseas sales ratio around the target of 27%)
19

Ⅲ. Initiatives of Medium-term Management Plan ―“Take Action 2014 (TA-14)”

3. Segment Projections
Water treatment chemicals

Water treatment facilities

Orders(Billions of Yen)
200

186.7
56.0

Sales
210.0

65.0

100

130.7

145.003/2013
Actual03/2015
Projection(Billions of Yen)30

30.0
21.003/2013
Actual0(%)
19124.1

140.003/2013
Actual03/2015
Projection

Operating Income Margin
18.5

12.0

8.3
12.6

0

205.0
180.1
56.1

Operating Income

15(Billions of Yen)
200

65.0

1000

Total

14

14.6
12.9

11.7
10.2

18.0
03/2015
Projection

14.9

903/2013
Actual03/2015
Projection20

Ⅲ. Initiatives of Medium-term Management Plan ―“Take Action 2014 (TA-14)”

4. Overseas Business Growth [Bolster Foundation]
Increase No.'s of Local Employees / Business Bases

R&DAlliances / M&As

 Overseas staff
Added approximately 80 staff in the fiscal year
ended March 31, 2013
 Opened sales office in Malaysia
 Enhanced business framework in Singapore

Localize advanced
analytics andapplications testing Set target for selection of
local resin and membrane
manufacturers
 Targeted Europe and North
America

China/Taiwan/South Korea
EuropeDalian
TianjinElectronicsindustrySuzhou
Guangzhou

SoutheastAsia
Water treatment
chemicals locations
Water treatment
facilities locations

Generalindustries

SouthKorea

ShanghaiTaiwanUS

Thailand

Malaysia

Singapore

BrazilIndonesia

21

Ⅲ. Initiatives of Medium-term Management Plan ―“Take Action 2014 (TA-14)”

5. Unparalleled reliability and Market Share Growth in Domestic Business

KuritaCustomer Plants
 Water treatment facilities
 Utility facilities

Equipment diagnostics
Operating statusmonitoring
Effect visualization
Share issues

 Sensing Comprehensivemaintenance Facility purchasecomprehensive operations
management

Resolve Issues221Ⅲ. Initiatives of Medium-term Management Plan ―“Take Action 2014 (TA-14)”

6. Creation of New Products and New Businesses [Key Themes]

Expand Products
for Overseas Markets

Cultivate
New Markets

BolsterCore Technologies
Membranes
Polymers

Match the specificneeds of overseas
markets

Food water

Energy water
Quick development ofnew products and newtechnologies

Ion exchange
Advanced analysis /sensing
Slime control

Space waterElectronic device cleaning /surface treatment

23

Ⅲ. Initiatives of Medium-term Management Plan ―“Take Action 2014 (TA-14)”

7. Creation of New Products and New Businesses [Strategic Products]
Electrolyzed Sulfuric Acid Generator

Semiconductor
manufacturing process

Reverse Osmosis Membrane
Treatment Chemicals

Wastewater reclaim facilities
Seawater desalination facilities
24

Ⅲ. Initiatives of Medium-term Management Plan ―“Take Action 2014 (TA-14)”

8. Improve Capital Efficiency
1. Invest in Growth Fields

2. Enhance Shareholder Returns

 Capital investment in promising fields

 Strive for continuous dividend increases

 R&D Overseas alliances / M&As

(Plan to increase dividend for the 10th consecutiveyear in fiscal year ending March 31, 2014)

 Flexible share buybacks(Acquired company shares via tender offer)(Billions of Yen)

CapitalInvestment

MP-11

TA-14

April 1, 2009 to
March 31, 2012(accumulated)

April 1, 2012 toMarch 31, 2015
(accumulated)

20.7

Share Buybacks
in fiscal year ended Mar. 31, 2013

Acquisition
PeriodNovember 1, 2012 toNovember 29, 201215.5 *

AcquisitionPrice

1,630 yen per share

Number ofShares
AcquiredDepreciation

45.6

44.9

R&D
Expense

12.4

13.6

* Only includes capital investment which has already been
decided as of March 31, 2013.

Total
Acquisition
Cost

7,493,665 shares(Ratio of total number ofshares issued: 5.64%)

12,214,673,950 yen

25

Ⅲ. Initiatives of Medium-term Management Plan ―“Take Action 2014 (TA-14)”

9. Enhance Corporate GovernanceSelection of New External Director Candidate
Aim to appoint an external director with a greater emphasis on
independence, with a view to respecting shareholder value andenhancing management transparency

Shorten the Term of Office for Directors to 1 Year
Target an optimal management structure that is reviewed inan agile and flexible manner to respond to significant changes
in the market environment.

26

Reference MaterialAnalysis of Changes in Operating Income for the Fiscal Year Ended March 31, 2013
(Billions of Yen)
30

- 3.9
29.4

- 0.07
Effect ofdecline inrevenue*

Effect of raw
materials
prices

- 1.6- 2.8
Increase in
SG&A
expenses

Effect ofchange in costof sales ratio*

21.0

15003/2012

03/2013*The effects of decline in revenue and change in the cost of sales ratio are calculated using the gross profit margin.

27

Kurita Water Industries Ltd.
U R L

h t t p : / / i r. k u r i t a . c o . j p /M A I Lir@kurita.co.jp

Forward-looking Statements
This presentation contains forward-looking statements, business plan projections, and judgments based on
information available to management at the time of writing. Due to the existence of a variety of risk factors
and uncertainties, actual results may differ from those specified or implied by these forward-looking
statements and projections.