Air Water : Consolidated Financial Results for the Second Quarter of Fiscal Year Ending March 31, 2019

Date: November 7, 2019

Consolidated Financial Results for the Second Quarter of Fiscal Year Ending March 31, 2019

(Under IFRS)

AIR WATER INC.

Head Office: 12-8, Minami semba 2-chome,

Chuo-ku, Osaka, Japan

Qualitative Information relating to Second Quarter Earnings

(1) Explanation of Operating Results

1. Operating results for the current period
   Although the Japanese economy in the cumulative second quarter of the current consolidated fiscal year was on

a modest recovery trend thanks to improvements in the employment environment and a pickup in consumer spending, uncertainty over the future economy continued to grow as export remained stagnant due to the protracted U.S. China trade conflicts and slowdown in the Chinese economy, which also affected production and facility investment of the domestic manufacturing industry.

Under these circumstances, the results of our corporate group showed steady progress in improving the overall business profitability despite the impact of changes in the external business environment on some of our businesses. Good progress was also made toward achieving our fiscal year business results forecast, including the start of revenue generation from our woody biomass power generation business, in addition to the effects of new consolidation through M&As.

As a result, for the current second quarter consolidated cumulative period, the group's revenue was ¥385,351 million (110.8% that of the corresponding period of the previous year), and operating profit was ¥22,133

million (113.6%). On the other hand, net profit attributable to owners of parent was ¥12,199 million (93.0% that of the corresponding period of the previous year), due primarily to the effects of the transfer of the coal chemical business on April 1, 2019.

Effective the current consolidated fiscal year, the classification of reporting segments has been changed. Accordingly, results of the previous consolidated fiscal year were also rearranged under the new segment classification for the purpose of year-on-year comparisons shown below.

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2) Consolidated results by segment for this period

					（Million	yen）
		Revenue	Operating profit
	FY 2019.2Q		YoY Growth	FY 2019.2Q	YoY Growth
Industrial Gas Business	90,653		112.2％	8,891	128.3％
Chemical Business	10,742		94.8％	△68	- ％
Medical Business	90,534		114.0％	3,719	105.5％
Energy Business	21,262		102.8％	841	127.1％
Agriculture and	70,467		100.6％	2,153	77.7％
Food Products Business
Logistics Business	25,193		107.3％	1,261	110.6％
Seawater Business	18,171		104.4％	1,180	135.2％
Other Business	58,327		130.9％	2,999	166.9％
（Adjustment）	-		- ％	1,155	94.6％
Total	385,351		110.8％	22,133	113.6％

(Note) The adjustment to operating profit is due to costs incurred at the company's headquarters division which was not allocated to any reporting segment.

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