Financial Results forthe Third Quarter Fiscal Year Ending December 2019 Investor Relations Presentation Materials President  Shiro Tomiyasu November 15, 2019 Index 1. Outline of Financial Results for the Third Quarter Fiscal Year Ending December, 2019 2. Domestic and Overseas Markets 3. Performance Forecast for the Fiscal Year Ending December 31, 2019 4. Topics 1.  Outline of Financial Results for the Third Quarter Fiscal Year Ending December, 2019 Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
Rush demand before consumption tax hike was witnessed, and sales increased mainly due to increased sales of agricultural machinery products and farming implements.
【Sales trends for farming implements,
While shipment to South Korea increased in addition to the solid North America, overseas sales as a whole declined slightly due to decreased sales in Europe, China and ASEAN.
Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
Operating income was increased due to a reduction in SG&A expenses in addition to increased gross profits from increased domestic sales.
※temporary factors last year: •Decreased temporary factors such as the application of the principle of calculating retirement benefits upon the merger of subsidiaries •Decreased profitability deterioration due to unprofitable construction work +0.2 +0.1 Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019 7
Foreign exchange loss and investment los  on equity method were recorded.
•Share of profit or loss of entities using equity method  -¥0.2 billion Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
Trade receivable increased due to increased domestic sales, while inventory asset declined.
Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
Interest-bearing liabilities increased through financing by long-term borrowings.
Note : D/E Ratio=Interest bearing liabilities(incl. Lease liabilities)/Net assetsで夢ある動物応援団? Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019 2 .  Domestic and Overseas Markets Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
Domestic agricultural The demand remained solid due to shipment of tractors (models jointly and bulk purchased by JA-Group) and rush demand before consumption tax hike. machine demand ■Agricultural machinery demand (shipments in the industry) *9 principal machinery: Tractors, combine harvesters, rice transplanters, tillers, drying machines, rice huskers, binders, harvesters, treatment Source: Estimated by ISEKI from statistics provided by the Japan Agricultural Machinery Manufacturers Association Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
Sales increased due to last-minute demand before consumption tax hike YoY growth rate for 9 principal machinery categories (moving annual total)
*ISEKI estimates *9 principal machinery: Tractors, combine harvesters, rice transplanters, tillers, drying machines, rice huskers, binders, harvesters, treatment
Sales expanded substantially in July-September. Domestic sales companies State of sales of agricultural machinery (YoY growth rate) (%)
lementation/practic
  smart agriculture
■ FY2020  Agriculture and fishery related budget requests Smart Agriculture Integrated Promotion Countermeasure Project (5.1 billion yen) <Project Image> *Source: MAFF  Re-edited outline of FY 2020 Agriculture and fishery related budget requests for ISEKI Technological development/Demonstration Smart agriculture acceleration demonstration project Data collection at each stage for management analysis Environmental development toward implementation/diffusion, •Development of strategy/system of production areas •Ensuring of safety of robot technology •Promotion of smart agriculture education •Promotion of the use of agriculture data coordination basis (WAGRI) Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019 15
Orders received in While continued to grow in North America, orders received are expected to be in line with the previous year due to a decrease in Europe and ASEAN. overseas Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
Compact tractor market remained solid. Sales by AGCO also increased further from the previous year.  Our orders received remained solid centering on compact tractors in line with strong sales by AGCO.
1. Trend in the market

(1000 units, %) 3. Our situation for sales and orders Order & shipment (Jan.-Dec. 2019): YoY   123% 2. Situation of AGCO (OEM partner) Unit sales (Jan.-Sep.2019) ▷Compact tractors > Utility tractors : YoY 105% : YoY 99% Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
While tractors remained solid, gardening products failed to grow due to unstable weather. We expect the sales to remain in line with the previous year partially due to the effect of stronger yen. 1. Trend in the market < Landscaping market > •Pre-season sales shifted strongly. • Unseasonable weather like low temperature in April and high temperature/dryness in late June
2.  Situation of distributors
➤ Unit sales (Jan.-Sep.2019) • Local distributors Tractors
3. Current sales and orders at ISEKI Order & Shipment (Jan.-Dec.2019)  : YoY 101% : Vs plan
Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
Purchase incentives tended to decline due to effect of the drought and flood. 1. Trend in the market • Impact of the drought and flood was significant 2. Situation of the local distributor “IST Farm Machinery” (Investment 80% by Mitsubishi Corporation, 20% by ISEKI) Number of units sold (ASEAN strategy tractor, Jan.-Sep.2019): YoY 91% 3. Current sales and orders at ISEKI Order & Shipment (Jan.-Dec.2019) : Substantial decline by inventory adjustment • While our order & shipment declined substantially due to restrained purchase by IST, reduction in the trade inventory progressed.
Tender in Indonesia was reopened. We promote sales expansion through tie-ups with our partners in other areas.
1. Market trend
< Indonesia > •  Promotion of mechanization by government initiative which has continued from 2015 (Government tender) •  As a result of the presidential election in April, the government continued and government tender was reopened.
< Myanmar >
•  Mechanization of agriculture has been accelerated. 2. Our situation Indonesia:  Sales declined YoY due to reduced tender volume. A ▷ Myanmar:  We aim at sales expansion through IST. • Orders received shifted outperforming the previous year.
3. Engagement by ISEKI Thailand
Enhance support of operation/service of distributors. Enhance supply system of repair parts based on ISEKI Thailand in anticipation of future market expansion. Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
Number of unit manufactured for Jan.- Sep. were in line with the plan. We promote further enhancement of profitability as the base station for earning abroad.
(Units, JPY bn) 2019 Jan.-Sep 9,200 0.1 Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
As a result of the cooling market, sales of rice transplanters dropped sharply. 1. National government subsidy (RMB bn)
2. Jan.-Sep. 2019 trends in the agricultural machinery industry (Y o Y change, units)
3. Situation of Dongfeng Iseki A In domestic sales in China, sales of rice transpInters decreased substantially. Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
Introduced tractors and combine harvesters in high performance machinery market
1. Trend in market
< Korea >
Move for heavier and more efficient agriculture machinery is progressing through encouraged crop conversion by initiative of the Korean government and consolidation of farmlands. High performance machinery market has become the main stream reflecting decreasing trend in the number of farming households. Combine harvesters HJ series
2. Our situation for sales
• We have introduced our flag ship machines of ISEKI brands, “TJ series” tractors and “HJ series” combine harvesters through the sales channel of the biggest agricultural machinery manufacturer in Korea   “TONGYANGMOOLSAN Co., Ltd Group” • All products for local sales have been exported, and most of them have been shipped to local retailers. Combine harvesters have been locally operated obtaining high reputation. TJ series Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019 3 .  Performance Forecast for the Fiscal Year Ending December 31, 2019 Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
Revision of sales based on actual values, recent orders and exchange rates Revenue has not been revised from the initial forecast, taking into account cost reductions through operational efficiency
announced on February 13, 2019 announced on November 13, 2019 *3: Assumptive forex rate for 4Q Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
で夢ある動物応援団?
Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019 Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
Reorganization of domestic sales companies area/2companies in a single prefecture Financial Results Briefing for the Third Quarter Fiscal Year Ending December 31, 2019
• The objective of this presentation document is to provide information and never intends to induce any action. • The document was created by ISEKI with 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 not liable for any losses incurred by investment decision made utilizing the business forecast or targets given in this document. As a proposal of "smart choices", we develop and deliver environmental-friendly products like "eco products".