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MarketScreener Homepage  >  Equities  >  Tokyo Stock Exchange  >  Komatsu Ltd.    6301   JP3304200003

KOMATSU LTD.

(6301)
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Komatsu : FY2020 Six months

10/28/2020 | 04:10am EST

Komatsu Ltd.

Corporate Communications Dept.

Tel: +81-(0)3-5561-2616

Date: October 28, 2020

URL: https://home.komatsu/en/

Consolidated Business Results for Six Months of the Fiscal Year Ending

March 31, 2021 (U.S. GAAP)

1. Results for Six Months Ended September 30, 2020

(Amounts are rounded to the nearest million yen)

(1) Consolidated Financial Highlights

Millions of yen except per share amounts

Six Months ended

Six Months ended

Changes

September 30, 2020

September 30, 2019

Increase (Decrease)

[A]

[B]

[A-B]

[(A-B)/B]

Net sales

957,717

1,213,485

(255,768)

(21.1%)

Operating income

60,342

141,982

(81,640)

(57.5%)

Income before income taxes and equity

58,530

128,212

(69,682)

(54.3%)

in earnings of affiliated companies

Net income attributable to Komatsu Ltd.

37,294

90,062

(52,768)

(58.6%)

Net income attributable to Komatsu Ltd.

per share (Yen)

Basic

¥39.48

¥95.40

¥(55.92)

Diluted

¥39.46

¥95.32

¥(55.86)

Note: Comprehensive income for six months ended September 30, 2020 and 2019

2020:

49,866 millions of yen, up 84.5% from 2019

2019:

27,024 millions of yen, down 84.7% from 2018

(2) Consolidated Financial Position

Millions of yen except per share amounts

As of September 30, 2020

As of March 31, 2020

Total assets

3,594,476

3,653,686

Total equity

1,866,710

1,856,225

Komatsu Ltd. shareholders' equity

1,777,598

1,771,606

Komatsu Ltd. shareholders' equity ratio

49.5%

48.5%

Komatsu Ltd. shareholders' equity per share (Yen)

¥1,880.99

¥1,875.47

- 1 -

2. Dividends

(For the fiscal years ended March 31, 2020 and ending March 31, 2021)

Yen

The entire FY ending March 31, 2021

The entire FY ended

Results

2021 Projections

March 31, 2020

First quarter period

Second quarter period

18.00

55.00

Third quarter period

Year-end

25.00

39.00

Total

43.00

94.00

Note: Changes in the latest projected cash dividend as of October 28, 2020: Applicable

3. Projections for the Fiscal Year Ending March 31, 2021 (From April 1, 2020 to March 31, 2021)

Millions of yen except per share amounts

2021

Changes

Increase (Decrease)

Net sales

2,119,000

(13.3%)

Operating income

134,000

(46.6%)

Income before income taxes and equity

127,000

(43.1%)

in earnings of affiliated companies

Net income attributable to Komatsu Ltd.

80,000

(48.0%)

Net income attributable to Komatsu Ltd.

per share - Basic (Yen)

¥84.67

Notes: 1) Changes in the latest projected consolidated business results as of October 28, 2020: Applicable

  1. Percentages shown above represent the rates of change compared with the corresponding period a year ago.

4. Others

  1. Changes in important subsidiaries during the six-month period under review: None
  2. Use of simplified accounting procedures and adoption of specific accounting procedures for the preparation of consolidated quarterly financial statements: None
  3. Changes in significant accounting rules, procedures and presentation and changes in significant accounting policies and estimates
    1. Changes resulting from revisions in accounting standards, etc.: None
    2. Changes in other matters except for 1) above: None

- 2 -

¥(22.84)
¥(22.81)
(21,543)
(50.6%)

(4) Number of common shares outstanding

  1. The numbers of common shares issued (including treasury stock) were as follows: As of September 30, 2020: 972,887,610 shares

As of March 31, 2020:

972,581,230 shares

  1. The numbers of shares of treasury were as follows: As of September 30, 2020: 27,855,307 shares

As of March 31, 2020:

27,959,273 shares

  1. The weighted average numbers of common shares outstanding were as follows: Six months ended September 30, 2020: 944,084,657 shares
    Six months ended September 30, 2019: 943,695,386 shares

[Reference]

Results for Three Months ended September 30, 2020

Net sales Operating income

Income before income taxes and equity in earnings of affiliated companies

Millions of yen except per share amounts

Three Months

Three Months

Changes

ended September

ended September

Increase (Decrease)

30, 2020

30, 2019

[A]

[B]

[A-B]

[(A-B)/B]

498,986

603,718

(104,732)

(17.3%)

33,423

67,222

(33,799)

(50.3%)

30,033

61,302

(31,269)

(51.0%)

Net income attributable to Komatsu Ltd.

21,043

42,586

Net income attributable to Komatsu Ltd.

per share (Yen)

Basic

¥22.27

¥45.11

Diluted

¥22.26

¥45.07

- 3 -

Appendix

Management Performance and Financial Conditions

  1. Outline of Operations and Business Results …………..……………………….. P.5
  2. Financial Conditions ……………………………………………..…………….. P.8
  3. Projection for the Fiscal Year Ending March 31, 2021 ……………………….... P.8
  4. Others ……….………………………..……………………………………….... P.10

Consolidated Financial Statements

  1. Consolidated Balance Sheets …………………………………………………… P.11
  2. Consolidated Statements of Income and
    Consolidated Statements of Comprehensive Income ...………………………… P.13
  3. Consolidated Statements of Cash Flows ……………………………………….. P.17
  4. Note to the Going Concern Assumption ……………………………………….. P.18
  5. Business Segment Information ………………………………………………… P.18
  6. Note in Case of Notable Changes in the Amount of Shareholders' Equity ……. P.20

- 4 -

Management Performance and Financial Conditions

(1) Outline of Operations and Business Results

Komatsu Ltd. ("Company") and its consolidated subsidiaries (together "Komatsu") have engaged in the three-yearmid-term management plan (FY2019 - 2021), "DANTOTSU Value - FORWARD Together for Sustainable Growth" for its 100th anniversary in 2021 and beyond. Under the mid-term management plan, launched in April 2019, Komatsu upholds three pillars of growth strategies of 1) value creation by means of innovation, 2) growth strategies based on business reforms, and 3) structural reforms for growth. While economic activities remain sluggish, due to the coronavirus (COVID-19) pandemic, Komatsu will continue to make efforts for sustainable growth through a positive cycle of improving earnings and solving ESG issues into the future.

For the first six-month period (April 1- September 30, 2020) of the fiscal year ending March 31, 2021, the second year of the mid-term management plan, consolidated net sales totaled JPY 957.7 billion, down 21.1% from the corresponding period a year ago. In the construction, mining and utility equipment business, demand fell, centering on North America, Europe & CIS and Asia, as particularly affected by the coronavirus (COVID-19) pandemic. As a result, sales declined from the corresponding period a year ago. In the industrial machinery and others business, demand for presses, sheet-metal machines, and machine tools remained slack against the coronavirus (COVID-19) pandemic. As a result, sales fell from the corresponding period a year ago.

With respect to profits for the first six-month period under review, operating income dropped by 57.5% from the corresponding period a year ago, to JPY 60.3 billion. This was mainly due to reduced sales volume, and a change in the geographic composition of sales in the construction, mining and utility equipment business, while Komatsu worked to reduce fixed costs. The operating income ratio decreased by 5.4 percentage points to 6.3%. Income before income taxes and equity in earnings of affiliated companies fell by 54.3% to JPY 58.5 billion. Net income attributable to Komatsu Ltd. totaled JPY 37.2 billion, down 58.6%.

[Consolidated Financial Highlights]

Millions of yen

Six Months

Six Months

ended September

ended September

Changes

30, 2020

30, 2019

1USD=JPY107.1

1USD=JPY109.0

Increase

1EUR=JPY121.4

1EUR=JPY121.6

(Decrease)

1RMB=JPY15.2

1RMB=JPY15.8

[A]

[B]

[(A-B)/B]

Net sales

957,717

1,213,485

(21.1%)

Construction, Mining and Utility Equipment

876,550

1,111,674

(21.2%)

Retail Finance

32,752

34,783

(5.8%)

Industrial Machinery and Others

64,938

73,729

(11.9%)

Elimination

(16,523)

(6,701)

-

Segment profit

60,757

140,689

(56.8%)

Construction, Mining and Utility Equipment

52,217

129,833

(59.8%)

Retail Finance

4,682

6,810

(31.2%)

Industrial Machinery and Others

4,102

4,039

1.6%

Corporate & elimination

(244)

7

-

Operating income

60,342

141,982

(57.5%)

Income before income taxes and equity

58,530

128,212

(54.3%)

in earnings of affiliated companies

Net income attributable to Komatsu Ltd.

37,294

90,062

(58.6%)

- 5 -

Note: Unless otherwise noted, all sales by segment in this report indicate the amounts before elimination of inter- segment transactions.

Business results by operation are described below.

Construction, Mining and Utility Equipment

For the first six-month period under review, sales of the construction, mining and utility equipment business decreased by 21.2% from the corresponding period a year ago, to JPY 876.5 billion. Segment profit fell by 59.8% to JPY 52.2 billion.

With respect to value creation by means of innovation, one of the three pillars of growth strategies in the mid-term management plan, Komatsu has worked to strengthen the Autonomous Haulage System (AHS) as an effort of focus, increasing the total number of AHS trucks in operation to over 260 units as of September 30, 2020. In addition to improving the safety and optimizing operations at customers' mines, Komatsu will also continue to promote mining automation as a solution to help reduce risks, such as lowered productivity, brought about by the coronavirus (COVID-19) pandemic.

Concerning the "SMARTCONSTRUCTION Digital Transformation", an effort of focus and a solutions business for construction workplaces, Komatsu is appealing its role as a solution to help customers optimize their construction work around the world. In Japan, Komatsu is introducing its retrofit kits, which provide ICT functions to conventional construction equipment, and by applications which monitor operations of dump trucks deployed for civil engineering. Komatsu will continue to accelerate the speed of achieving digital transformation of construction workplaces.

With regard to growth strategies based on business reforms, Komatsu has worked to integrate the brands of mining products made by Komatsu Mining Corp. in order to further strengthen its mining equipment business. Komatsu has also continued to strengthen its aftermarket efforts in Strategic Markets. As a main effort, Komatsu offers a new service program with a warranty period which is longer than that of extended conventional programs. In September this year, Komatsu embarked on this new program in India, following China, Thailand, and Indonesia.

[Sales to Outside Customers of Construction, Mining and Utility Equipment by Region]

Millions of yen

Six Months ended

Six Months ended

Changes

September 30, 2020

September 30, 2019

Increase (Decrease)

[A]

[B]

[A-B]

[(A-B)/B]

Japan

132,208

148,738

(16,530)

(11.1%)

North America

204,120

291,405

(87,285)

(30.0%)

Latin America

125,316

148,660

(23,344)

(15.7%)

Americas

329,436

440,065

(110,629)

(25.1%)

Europe

79,594

107,747

(28,153)

(26.1%)

CIS

47,962

70,833

(22,871)

(32.3%)

Europe & CIS

127,556

178,580

(51,024)

(28.6%)

China

71,887

61,444

10,443

17.0%

Asia*

52,396

115,475

(63,079)

(54.6%)

Oceania

102,183

103,050

(867)

(0.8%)

Asia* & Oceania

154,579

218,525

(63,946)

(29.3%)

Middle East

11,807

13,634

(1,827)

(13.4%)

Africa

36,841

48,327

(11,486)

(23.8%)

Middle East & Africa

48,648

61,961

(13,313)

(21.5%)

Total

864,314

1,109,313

(244,999)

(22.1%)

- 6 -

Note: *Excluding Japan and China

Komatsu's operations by region are described below.

Japan

For the first six-month period under review, while the coronavirus (COVID-19) pandemic had a small impact, especially, on public works, sales declined from the corresponding period a year ago, as adversely affected by slack private-sector construction as well as limited sales and service activities.

Americas

In North America, sales dropped sharply from the corresponding period a year ago. Under slack economic activities as affected by the coronavirus (COVID-19) pandemic, demand for construction equipment fell in the rental industry and the energy-related sector, which was adversely affected by declining crude prices, and that for mining equipment remained slack. In Latin America, demand for construction equipment remained steady in Brazil, but that for construction and mining equipment remained slack in other countries. As a result, sales declined.

Europe and CIS

In Europe, sales decreased from the corresponding period a year ago, as demand remained sluggish, especially in the major markets of Germany, the United Kingdom and France. In CIS, sales fell sharply, especially affected by sluggish demand for mining equipment in coal mines, while demand was steady in gold mines.

China

Demand remained strong, supported by the government's economic stimulus measures, such as infrastructure investment, after containing the coronavirus (COVID-19) pandemic. As a result of steadily capturing growing demand, sales increased from the corresponding period a year ago, even when the share of sales made by domestic manufacturers increased.

Asia and Oceania

In Asia, sales dropped sharply from the corresponding period a year ago. Sales were adversely affected by not only sluggish demand for mining equipment in Indonesia, the largest market of the region, resulting from the declining price of thermal coal, but also sluggish demand for construction equipment, mainly in Indonesia, India, and the Philippines, under the coronavirus (COVID-19) pandemic. In Oceania, sales remained flat, as demand remained steady for mining equipment in iron ore mines as well as construction equipment.

Middle East and Africa

In the Middle East, sales fell from the corresponding period a year ago, as demand remained slack in most countries, mainly against sluggish crude oil prices and the coronavirus (COVID-19) pandemic, albeit demand showed signs of recovery in Turkey. In Africa, sales dropped, mainly affected by the governments restricted economic activities in response to the coronavirus (COVID-19) pandemic in Southern Africa. Demand for mining equipment also fell.

- 7 -

Retail Finance

Revenues decreased by 5.8% from the corresponding period a year ago, to JPY 32.7 billion, supported by reduced assets centering on North America. Segment profit fell by 31.2% to JPY 4.6 billion, mainly reflecting adverse effects of extension of payments and revaluation of vehicles after lease use.

Industrial Machinery and Others

For the first six-month period under review, sales declined by 11.9% from the corresponding period a year ago, to JPY 64.9 billion. This was mainly affected about by declined demand for and delayed installation of presses, sheet- metal machines, and machine tools at customers' overseas workplaces under the coronavirus (COVID-19) pandemic. Meanwhile, sales remained steady for Excimer laser-related business in the semiconductor market. As a result, segment profit increased by1.6% to JPY 4.1 billion.

In August this year, Komatsu Industries Corp. began sales of its TFPL10-6 and TFPL08-6, TWISTER, a universal, high-performance plasma cutting machine for medium and heavy thickness plates, which integrates Komatsu's leading-edgeplasma-cutting technologies.

(2) Financial Conditions

As of September 30, 2020, total assets decreased by JPY 59.2 billion from the previous fiscal year-end, to JPY 3,594.4 billion. While inventories increased, the Japanese yen appreciated against the U.S. dollar and some other currencies, and receivables and cash declined, compared to the previous fiscal year-end.Interest-bearing debt decreased by JPY 46.3 billion from the previous fiscal year-end, to JPY 966.0 billion. Komatsu Ltd. shareholders' equity increased by JPY 5.9 billion from the previous fiscal year-end, to JPY 1,777.5 billion. As a result, Komatsu Ltd. shareholders' equity ratio increased by 1.0 percentage points from the previous fiscal year-end, to 49.5%.

For the first six-month period under review, net cash provided by operating activities totaled JPY 152.5 billion, an increase of JPY 16.7 billion from the corresponding period a year ago. This increase is due to good progress made in the collection of trade notes and accounts receivable, while inventories increased. Net cash used in investing activities amounted to JPY 80.0 billion, a decrease of JPY 26.6 billion from the corresponding period a year ago, mainly due to the purchase of fixed assets. Net cash used in financing activities amounted to JPY 87.0 billion (as compared to JPY 13.6 billion used for the corresponding period a year ago), mainly due to the repayment of debt and payment of cash dividends. After adding the effects of foreign exchange fluctuations to the total amount of each cash flow, as of September 30, 2020, cash and cash equivalents totaled JPY 234.4 billion, a decrease of JPY 13.1 billion from the previous fiscal year-end.

  1. Projection for the Fiscal Year Ending March 31, 2021 (From April 1, 2020 to March 31, 2021)

In the first six-month period (April 1 - September 30, 2020) of the fiscal year ending March 31, 2021, demand for construction and mining equipment decline, particularly in North America, Europe & CIS, and Asia as affected by the coronavirus (COVID-19) pandemic. In the second six-month period (October 1, 2020 - March 31, 2021), Komatsu assumes that demand will remain steady in China and will get back on a recovery track in North America, Japan and some other regions. While Komatsu will continue to invest in growth areas, an effort of focus in the mid- term management plan, it can also look forward to benefits of reduced fixed costs by having reassessed the

- 8 -

priorities of projects and improved operational efficiency. As a result, we can expect that full year business results for FY2020 will outperform the projections as of July 30, 2020 and we will revise both sales and profits.

Concerning foreign exchange rates, which are preconditions for the projection of full year results, Komatsu has revised the projected exchange rate with the euro (to EUR 1=JPY 124 as the average exchange rate in the second six-month period). Accordingly, Komatsu estimates the average exchange rates for the full year as follows: USD 1=JPY 106.1, EUR 1=JPY 122.7 and RMB 1=JPY 15.1. (Initial assumption: USD 1=JPY 105.6, EUR 1=JPY 116.7 and RMB 1=JPY 15.0)

Projection for Consolidated Business Results for FY2020 (April 1, 2020 - March 31, 2021)

Millions of yen except per share amounts

Current

Earlier

Changes

Results for FY

projection

projection

ended March 31,

[A]

[B]

[A-B]

[(A-B)/B]

2020

Net sales

2,119,000

2,068,000

51,000

2.5%

2,444,870

Operating income

134,000

115,000

19,000

16.5%

250,707

Income before income taxes

and equity in earnings of

127,000

108,000

19,000

17.6%

223,114

affiliated companies

Net income attributable to

80,000

67,000

13,000

19.4%

153,844

Komatsu Ltd.

Net income attributable to

Komatsu Ltd.

84.67

70.93

-

-

162.93

per share - Basic (Yen)

Basic Policy for Redistribution of Profits and Dividends for the Fiscal Year under Review

Komatsu is building a sound financial position and is enhancing its competitiveness in order to increase its sustainable corporate value. Concerning cash dividends, Komatsu has the policy of continuing stable payment of dividends after comprehensively considering consolidated business results and reviewing future investment plans, cash flows and the like. Specifically, Komatsu has the policy of maintaining a consolidated payout ratio of 40% or higher.

Concerning the interim cash dividend under this basic policy, Komatsu is planning to set JPY 18 per share, as projected on July 30, 2020. With respect to the year-end cash dividend, after reviewing business results for the first six-month period of FY2020 and considering future business prospects, Komatsu is also revising its earlier projection and planning to increase that dividend by JPY 7 from the projection, to JPY 25 per share. As a result, Komatsu plans to pay annual cash dividends of JPY 43 per share, decrease of JPY 51 from the previous fiscal year ended March 31, 2020. The consolidated payout ratio will become 50.8%, as Komatsu maintains its earlier projection.

- 9 -

  1. Others
  1. Changes in important subsidiaries during the six-month period under review: None
  2. Use of simplified accounting procedures and adoption of specific accounting procedures for the preparation of consolidated quarterly financial statements: None
  3. Changes in significant accounting rules, procedures and presentation and changes in significant accounting policies and estimates
  1. Changes resulting from revisions in accounting standards, etc.: None
  2. Changes in other matters except for a) above: None

Cautionary Statement

The announcement set forth herein contains forward-looking statements which reflect management's current views with respect to certain future events, including expected financial position, operating results, and business strategies. These statements can be identified by the use of terms such as "will," "believes," "should," "projects" and similar terms and expressions that identify future events or expectations. Actual results may differ materially from those projected, and the events and results of such forward-looking assumptions cannot be assured.

Factors that may cause actual results to differ materially from those predicted by such forward-looking statements include, but are not limited to, unanticipated changes in demand for the Company's principal products, owing to changes in the economic conditions in the Company's principal markets; changes in exchange rates or the impact of increased competition; unanticipated cost or delays encountered in achieving the Company's objectives with respect to globalized product sourcing and new Information Technology tools; uncertainties as to the results of the Company's research and development efforts and its ability to access and protect certain intellectual property rights; and, the impact of regulatory changes and accounting principles and practices.

- 10 -

Consolidated Financial Statements

(1) Consolidated Balance Sheets

Assets

Millions of yen

As of September 30, 2020

As of March 31, 2020

Ratio

Ratio

(%)

(%)

Current assets

Cash and cash equivalents

¥

234,454

¥

247,616

Time deposits

1,399

2,057

Trade notes and accounts receivable, net

669,907

744,395

Inventories

838,901

805,309

Other current assets

131,429

147,413

Total current assets

1,876,090

52.2

1,946,790

53.3

Long-term trade receivables, net

426,638

11.9

420,918

11.5

Investments

Investments in and advances to affiliated companies

38,014

38,210

Investment securities

7,698

7,328

Other

2,538

2,436

Total investments

48,250

1.3

47,974

1.3

Property, plant and equipment

757,463

21.1

757,679

20.8

- less accumulated depreciation and amortization

Operating lease right-of-use assets

54,487

1.5

53,454

1.5

Goodwill

158,834

4.4

157,521

4.3

Other intangible assets

162,840

4.5

162,062

4.4

- less accumulated amortization

Deferred income taxes and other assets

109,874

3.1

107,288

2.9

Total

¥

3,594,476

100.0

¥

3,653,686

100.0

- 11 -

Liabilities and Equity

Millions of yen

As of September 30, 2020

As of March 31, 2020

Ratio

Ratio

(%)

(%)

Current liabilities

Short-term debt

¥

380,289

¥

483,658

Current maturities of long-term debt

57,339

118,880

Trade notes, bills and accounts payable

194,054

220,160

Income taxes payable

22,317

23,169

Current operating lease liabilities

14,662

14,933

Other current liabilities

301,336

297,825

Total current liabilities

969,997

27.0

1,158,625

31.7

Long-term liabilities

Long-term debt

528,427

409,840

Liability for pension and retirement benefits

95,476

96,392

Long-term operating lease liabilities

39,752

38,624

Deferred income taxes and other liabilities

94,114

93,980

Total long-term liabilities

757,769

21.1

638,836

17.5

Total liabilities

1,727,766

48.1

1,797,461

49.2

Komatsu Ltd. shareholders' equity

Common stock

69,037

68,689

Capital surplus

136,587

136,459

Retained earnings:

Appropriated for legal reserve

47,258

46,813

Unappropriated

1,699,110

1,699,477

Accumulated other comprehensive income (loss)

(125,409)

(130,666)

Treasury stock

(48,985)

(49,166)

Total Komatsu Ltd. shareholders' equity

1,777,598

49.5

1,771,606

48.5

Noncontrolling interests

89,112

2.4

84,619

2.3

Total equity

1,866,710

51.9

1,856,225

50.8

Total

¥

3,594,476

100.0

¥

3,653,686

100.0

- 12 -

  1. Consolidated Statements of Income and Consolidated Statements of Comprehensive Income

Six months ended September 30, 2020 and 2019

Consolidated Statements of Income

Millions of yen except per share amounts

Six Months ended

Six Months ended

September 30, 2020

September 30, 2019

Ratio

Ratio

(%)

(%)

Net sales

¥

957,717

100.0

¥

1,213,485

100.0

Cost of sales

699,812

73.1

855,318

70.5

Selling, general and administrative expenses

197,148

20.6

217,478

17.9

Other operating income (expenses), net

(415)

(0.0)

1,293

0.1

Operating income

60,342

6.3

141,982

11.7

Other income (expenses), net

Interest and dividend income

2,414

0.3

3,732

0.3

Interest expense

(7,406)

(0.8)

(13,108)

(1.1)

Other, net

3,180

0.3

(4,394)

(0.4)

Total other income (expenses), net

(1,812)

(0.2)

(13,770)

(1.1)

Income before income taxes and equity

58,530

6.1

128,212

10.6

in earnings of affiliated companies

Income taxes

17,098

1.8

35,618

2.9

Income before equity in earnings of affiliated

41,432

4.3

92,594

7.6

companies

Equity in earnings of affiliated companies

1,189

0.1

1,730

0.1

Net income

42,621

4.5

94,324

7.8

Less: Net income attributable to noncontrolling

5,327

0.6

4,262

0.4

interests

Net income attributable to Komatsu Ltd.

¥

37,294

3.9

¥

90,062

7.4

Net income attributable to Komatsu Ltd.

per share (Yen)

Basic

¥

39.48

¥

95.40

Diluted

¥

39.46

¥

95.32

- 13 -

Consolidated Statements of Comprehensive Income

Millions of yen

Six Months ended

Six Months ended

September 30, 2020

September 30, 2019

Net income

¥

42,621

¥

94,324

Other comprehensive income (loss), for the period,

net of tax

Foreign currency translation adjustments

6,506

(66,214)

Pension liability adjustments

487

145

Net unrealized holding gains (losses) on derivative

252

(1,231)

instruments

Total other comprehensive income (loss), for the

7,245

(67,300)

period, net of tax

Comprehensive income

49,866

27,024

Less: Comprehensive income (loss) attributable to

7,315

(361)

noncontrolling interests

Comprehensive income attributable

¥

42,551

¥

27,385

to Komatsu Ltd.

- 14 -

Three months ended September 30, 2020 and 2019

Consolidated Statements of Income

Millions of yen except per share amounts

Three Months ended

Three Months ended

September 30, 2020

September 30, 2019

Ratio

Ratio

(%)

(%)

Net sales

¥

498,986

100.0

¥

603,718

100.0

Cost of sales

365,092

73.2

427,961

70.9

Selling, general and administrative expenses

99,775

20.0

107,811

17.9

Other operating income (expenses), net

(696)

(0.1)

(724)

(0.1)

Operating income

33,423

6.7

67,222

11.1

Other income (expenses), net

Interest and dividend income

1,229

0.2

1,986

0.3

Interest expense

(3,565)

(0.7)

(6,458)

(1.1)

Other, net

(1,054)

(0.2)

(1,448)

(0.2)

Total other income (expenses), net

(3,390)

(0.7)

(5,920)

(1.0)

Income before income taxes and equity

30,033

6.0

61,302

10.2

in earnings of affiliated companies

Income taxes

7,280

1.5

17,787

2.9

Income before equity in earnings of affiliated

22,753

4.6

43,515

7.2

companies

Equity in earnings of affiliated companies

638

0.1

1,062

0.2

Net income

23,391

4.7

44,577

7.4

Less: Net income attributable to noncontrolling

2,348

0.5

1,991

0.3

interests

Net income attributable to Komatsu Ltd.

¥

21,043

4.2

¥

42,586

7.1

Net income attributable to Komatsu Ltd.

per share (Yen)

Basic

¥

22.27

¥

45.11

Diluted

¥

22.26

¥

45.07

- 15 -

Consolidated Statements of Comprehensive Income

Millions of yen

Three Months ended

Three Months ended

September 30, 2020

September 30, 2019

Net income

¥

23,391

¥

44,577

Other comprehensive income (loss), for the period,

net of tax

Foreign currency translation adjustments

(8,148)

(32,903)

Pension liability adjustments

223

(183)

Net unrealized holding gains (losses) on derivative

489

(517)

instruments

Total other comprehensive income (loss), for the

(7,436)

(33,603)

period, net of tax

Comprehensive income

15,955

10,974

Less: Comprehensive income attributable to

2,180

86

noncontrolling interests

Comprehensive income attributable

¥

13,775

¥

10,888

to Komatsu Ltd.

- 16 -

(3) Consolidated Statements of Cash Flows

Millions of yen

Six Months ended

Six Months ended

September 30, 2020

September 30, 2019

Operating activities

¥

42,621

Net income

¥

94,324

Adjustments to reconcile net income to net cash provided by (used

in) operating activities:

Depreciation and amortization

64,713

64,683

Deferred income taxes

(2,689)

(330)

Impairment loss and net loss (gain) on valuation of investment

63

(101)

securities

Net loss (gain) on sale of fixed assets

(99)

(620)

Loss on disposal of fixed assets

1,099

1,618

Pension and retirement benefits, net

(237)

(796)

Changes in assets and liabilities:

Decrease (increase) in trade receivables

72,882

56,322

Decrease (increase) in inventories

(32,499)

(88,414)

Increase (decrease) in trade payables

(25,801)

(12,440)

Increase (decrease) in income taxes payable

(1,406)

(17,030)

Other, net

33,889

38,540

Net cash provided by (used in) operating activities

152,536

135,756

Investing activities

(85,278)

Capital expenditures

(91,837)

Proceeds from sale of fixed assets

6,010

6,979

Proceeds from sale of investment securities

21

525

Purchases of investment securities

(537)

(492)

Acquisition of subsidiaries and equity investees, net of cash

(1,717)

(21,606)

acquired

Other, net

1,477

(267)

Net cash provided by (used in) investing activities

(80,024)

(106,698)

Financing activities

Proceeds from debt issued (Original maturities greater than three

407,541

230,299

months)

Payment on debt (Original maturities greater than three months)

(418,930)

(228,337)

Short-term debt, net (Original maturities three months or less)

(33,828)

45,511

Dividends paid

(36,859)

(55,719)

Other, net

(4,938)

(5,417)

Net cash provided by (used in) financing activities

(87,014)

(13,663)

Effect of exchange rate change on cash and cash equivalents

1,340

(872)

Net increase (decrease) in cash and cash equivalents

(13,162)

14,523

Cash and cash equivalents, beginning of year

247,616

148,479

Cash and cash equivalents, end of period

¥

234,454

¥

163,002

- 17 -

(4) Note to the Going Concern Assumption

None

(5) Business Segment Information

1) Information by Operating Segments

Six Months ended September 30, 2020 and 2019

(For Six Months ended September 30, 2020)

Millions of yen

Construction,

Industrial

Mining and

Retail

Corporate &

Machinery

Subtotal

Total

Utility

Finance

elimination

and Others

Equipment

Net sales:

Customers

864,314

28,928

64,475

957,717

-

957,717

Intersegment

12,236

3,824

463

16,523

(16,523)

-

Total

876,550

32,752

64,938

974,240

(16,523)

957,717

Segment profit

52,217

4,682

4,102

61,001

(244)

60,757

(For Six Months ended September 30, 2019)

Millions of yen

Construction,

Industrial

Mining and

Retail

Corporate &

Machinery

Subtotal

Total

Utility

Finance

elimination

and Others

Equipment

Net sales:

Customers

1,109,313

31,144

73,028

1,213,485

-

1,213,485

Intersegment

2,361

3,639

701

6,701

(6,701)

-

Total

1,111,674

34,783

73,729

1,220,186

(6,701)

1,213,485

Segment profit

129,833

6,810

4,039

140,682

7

140,689

- 18 -

Three Months ended September 30, 2020 and 2019 (For Three Months ended September 30, 2020)

Millions of yen

Construction,

Industrial

Mining and

Retail

Corporate &

Machinery

Subtotal

Total

Utility

Finance

elimination

and Others

Equipment

Net sales:

Customers

444,309

14,980

39,697

498,986

-

498,986

Intersegment

6,430

1,851

219

8,500

(8,500)

-

Total

450,739

16,831

39,916

507,486

(8,500)

498,986

Segment profit

29,017

2,787

2,395

34,199

(80)

34,119

(For Three Months ended September 30, 2019)

Millions of yen

Construction,

Industrial

Mining and

Retail

Corporate &

Machinery

Subtotal

Total

Utility

Finance

elimination

and Others

Equipment

Net sales:

Customers

548,715

15,678

39,325

603,718

-

603,718

Intersegment

1,482

1,826

383

3,691

(3,691)

-

Total

550,197

17,504

39,708

607,409

(3,691)

603,718

Segment profit

61,144

3,406

3,485

68,035

(89)

67,946

Notes: 1) Business categories and principal products & services included in each operating segment are as follows:

  1. Construction, Mining and Utility Equipment
    Excavating equipment, loading equipment, grading & roadbed preparation equipment, hauling equipment, forestry equipment, tunneling machines, underground mining equipment, recycling equipment, industrial vehicles, other equipment, engines & components, casting products, and logistics
  2. Retail Finance Financing
  3. Industrial Machinery and Others

Metal forging & stamping presses, sheet-metal machines, machine tools, defense systems, temperature-control equipment, and optical machinery

2) Transfers between segments are made at estimated arm's-length prices.

- 19 -

2) Geographic Information

Net sales determined by customer location were as follows:

For Six Months ended September 30, 2020 and 2019

Millions of yen

Japan

Americas

Europe &

China

Asia* &

Middle East

Total

CIS

Oceania

& Africa

FY2020

168,712

358,280

132,225

79,004

170,720

48,776

957,717

FY2019

183,835

471,643

183,373

74,145

238,305

62,184

1,213,485

Note: * Excluding Japan and China

For Three Months ended September 30, 2020 and 2019

Millions of yen

Japan

Americas

Europe &

China

Asia* &

Middle East

Total

CIS

Oceania

& Africa

FY2020

94,469

185,131

69,943

32,304

89,127

28,012

498,986

FY2019

105,759

238,461

88,402

30,855

108,997

31,244

603,718

Note: * Excluding Japan and China

(6) Note in Case of Notable Changes in the Amount of Shareholders' Equity

None

(end)

- 20 -

Disclaimer

Komatsu Ltd. published this content on 28 October 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 October 2020 09:09:08 UTC


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