Kubota : RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2021

FOR IMMEDIATE RELEASE	May 14, 2021

Contact: IR Group

Corporate Planning and Control Dept.

2-47, Shikitsuhigashi 1-chome,

Naniwa-ku, Osaka 556-8601, Japan

Phone: [phone]

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2021 [IFRS]

Kubota Corporation hereby reports its consolidated results for the three months ended March 31, 2021.

Consolidated Financial Highlights

1. Consolidated results of operations for the three months ended March 31, 2021

(1) Results of operations			(Unit: millions of yen, except earnings per share)
	Three months ended		Change	Three months ended	Change
	Mar. 31, 2021		[%]	Mar. 31, 2020	[%]
Revenue	¥ 537,686		22.3	¥ 439,543	(8.6)
Operating profit	¥ 77,723		155.2	¥	30,458	(42.4)
Profit before income taxes	¥ 78,318		152.4	¥	31,030	(42.7)
Profit for the period	¥ 57,467		147.4	¥	23,228	(42.6)
Profit attributable to owners of the parent	¥ 52,041		150.7	¥	20,756	(44.3)
Comprehensive income (loss) for the period	¥ 120,061		-	(¥	24,112)	-
Earnings per share attributable to owners of the parent:
Basic	¥ 43.08				¥ 17.01
Diluted	-				-
(2) Financial condition					(Unit: millions of yen)
	Mar. 31, 2021		Dec. 31, 2020
Total assets	¥ 3,384,634			¥ 3,189,317
Total equity	¥ 1,671,129			¥ 1,574,185
Equity attributable to owners of the parent	¥ 1,565,211			¥ 1,476,039
Ratio of equity attributable to owners of the parent
to total assets	46.2%				46.3%

Note:

Change [%] represents the percentage change from the same period in the prior year.

2. Cash dividends

			(Unit: yen)
	Cash dividends per common share
	Interim	Year-end	Total
Year ending Dec. 31, 2021	Undecided	Undecided	Undecided
Year ended Dec. 31, 2020	¥ 17.00	¥ 19.00	¥ 36.00

Note:

Although Kubota Corporation's basic policy for the return of profit to shareholders is to maintain stable dividends and raise dividends, the specific amount of cash dividends for each fiscal year is decided in consideration of the development of business performance, financial condition, and shareholder return ratio calculated from dividends and share buy‐backs. The specific amount of cash dividends for the year ending December 31, 2021 has not been decided at this time and Kubota Corporation will publicize the amount as soon as a decision is made.

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Kubota Corporation

and Its Subsidiaries

3. Forecasts of operations for the year ending December 31, 2021

(Unit: millions of yen, except earnings per share)

	Six months ending	Change	Year ending	Change
	June 30, 2021	[%]	Dec. 31, 2021	[%]
Revenue	¥ 1,040,000	17.6	¥ 2,050,000	10.6
Operating profit	¥ 120,000	46.9	¥ 220,000	25.5
Profit before income taxes	¥ 123,000	45.7	¥ 225,000	21.0
Profit attributable to owners of the parent	¥ 88,000	47.7	¥ 158,000	22.9
Earnings per share attributable to owners
of the parent - Basic	¥ 72.85		¥ 130.80

Notes:

1. Change [%] represents the percentage change from the same period in the prior year.
2. Please refer to the accompanying materials, "1. Review of operations and financial condition (3) Forecasts for the year ending December 31, 2021" on page 6 for further information related to the forecasts of operations.

4. Other information

1. Changes in significant subsidiaries during the three months ended March 31, 2021 (changes in specified subsidiaries resulting in the changes in scope of consolidation): None
2. Changes in accounting policies and changes in accounting estimates
3. 1. Changes in accounting policies required by IFRS: None
   2. Changes in accounting policies due to reasons other than a) above: None
   3. Changes in accounting estimates: None
4. Number of common shares issued

a) Number of common shares issued including treasury shares as of March 31, 2021	:	1,208,576,846
Number of common shares issued including treasury shares as of December 31, 2020	:	1,208,576,846
b) Number of treasury shares as of March 31, 2021	:	644,381
Number of treasury shares as of December 31, 2020	:	643,937
c) Weighted-average number of common shares outstanding during the three months ended March 31, 2021	:	1,207,925,094
Weighted-average number of common shares outstanding during the three months ended March 31, 2020	:	1,219,923,014

(Information on the status of the quarterly review by the independent auditor) This release is not subject to the quarterly review by the independent auditor.

(Method of obtaining supplementary materials on the financial results)

Kubota Corporation plans to hold a result briefing (conference call) for institutional investors and securities analysts on May 14, 2021. The supplementary material will be published on the Company's website on the same day.

< Cautionary statements with respect to forward-looking statements >

This document may contain forward-looking statements that are based on management's expectations, estimates, projections and assumptions. These statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Therefore, actual future results may differ materially from what is forecast in forward-looking statements due to a variety of factors, including, without limitation: general economic conditions in the Company's markets, particularly government agricultural policies, levels of capital expenditures both in public and private sectors, foreign currency exchange rates, the occurrence of natural disasters, continued competitive pricing pressures in the marketplace, as well as the Company's ability to continue to gain acceptance of its products.

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Kubota Corporation

and Its Subsidiaries

Index to accompanying materials

1. Review of operations and financial condition …………………………………………………………………………………………	4
(1)	Summary of the results of operations for the three-month period …………………………………………………	4
(2)	Financial condition ……………………………………………………………………………………………………………………......	5
(3)	Forecasts for the year ending December 31, 2021 …………………………………………………………………………	6

2. Other information ……………………………………………………………………………………………………………………............... 6

(1)	Changes in significant subsidiaries ……………………………………………………………………………………………………	6
(2)	Changes in accounting policies …………………………………………………………………………………………………………	6
3. Condensed consolidated financial statements …………………………………………………………………………………………	7
(1)	Condensed consolidated statement of financial position …………………………………………………………………	7
(2)	Condensed consolidated statement of profit or loss ………………………………………………………………………	9
(3)	Condensed consolidated statement of comprehensive income ………………………………………………………	10
(4)	Condensed consolidated statement of changes in equity ………………………………………………………………	11
(5)	Condensed consolidated statement of cash flows ……………………………………………………………………………	12
(6)	Notes to the going concern assumption …………………………………………………………………………………………	12
(7)	Consolidated segment information …………………………………………………………………………………………………	13
(8)	Consolidated revenue by product group …………………………………………………………………………………………	14

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Kubota Corporation

and Its Subsidiaries

1. Review of operations and financial condition

(1) Summary of the results of operations for the three-month period

For the three months ended March 31, 2021, revenue of Kubota Corporation and its subsidiaries (hereinafter, the "Company") increased by ¥98.1 billion [22.3%] from the same period in the prior year to ¥537.7 billion.

Domestic revenue increased by ¥10.0 billion [6.7%] from the same period in the prior year to ¥160.0 billion because of increased revenue in Farm & Industrial Machinery mainly due to increased sales of farm equipment, while revenue in Water & Environment was almost at the same level as the prior year.

Overseas revenue increased by ¥88.1 billion [30.4%] from the same period in the prior year to ¥377.6 billion because of significantly increased sales of farm equipment and construction machinery. In addition, revenue in Water & Environment also increased from the same period in the prior year.

Operating profit increased by ¥47.3 billion [155.2%] from the same period in the prior year to ¥77.7 billion due to increased revenue in the domestic and overseas markets and improved foreign exchange gain/loss. In addition, there was a negative effect from deteriorated profitability of products, which had been shipped in the same period in the prior year, in its manufacturing bases along with a significant reduction in production in the fourth quarter of 2019. Profit before income taxes increased by ¥47.3 billion [152.4%] from the same period in the prior year to ¥78.3 billion due to increased operating profit. Income tax expenses were ¥21.4 billion. Share of profits of investments accounted for using the equity method was ¥0.5 billion. Profit for the period increased by ¥34.2 billion [147.4%] from the same period in the prior year to ¥57.5 billion. Profit attributable to owners of the parent increased by ¥31.3 billion [150.7%] from the same period in the prior year to ¥52.0 billion.

Revenue from external customers and operating profit by each reportable segment were as follows:

1) Farm & Industrial Machinery

Farm & Industrial Machinery is comprised of farm equipment, agricultural-related products, engines, and construction machinery.

Revenue in this segment increased by 28.1% from the same period in the prior year to ¥444.5 billion and accounted for 82.7% of consolidated revenue.

Domestic revenue increased by 14.7% from the same period in the prior year to ¥76.1 billion. Sales of farm equipment and agricultural-related products increased due to a recovery from adverse reaction from rushed demand before the consumption tax hike and increased demand resulting from subsidies for business continuation of farmers.

Overseas revenue increased by 31.3% from the same period in the prior year to ¥368.3 billion. In North America, sales of tractors and construction machinery increased significantly mainly due to strong demand along with trend in move to suburbs despite delay in shipment caused by port congestion and other effects. In Europe, sales of construction machinery, tractors, and engines increased due to a recovery from sluggish sales along with the infection spread of COVID- 19 in the prior year. In Asia outside Japan, sales of farm equipment in Thailand significantly increased mainly due to eased concerns about drought along with rainfall in the prior year and stable crop prices at a high level. In addition, sales of farm equipment in China, Philippines, and India were strong as well. In Other areas, sales of tractors and construction machinery in Australia increased significantly due to more rainfall than usual and government stimulus measures.

Operating profit in this segment increased by 123.1% from the same period in the prior year to ¥68.1 billion mainly due to significantly increased revenue in the domestic and overseas markets and deteriorated profitability of products, which had been shipped in the same period in the prior year, in its manufacturing bases.

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Kubota Corporation

and Its Subsidiaries

2) Water & Environment

Water & Environment is comprised of pipe- and infrastructure-related products (ductile iron pipes, plastic pipes, valves for public sector, industrial castings, spiral-welded steel pipes, air-conditioning equipment, and other products) and environment-related products (environmental control plants, pumps, valves for private sector, and other products).

Revenue in this segment increased by 1.0% from the same period in the prior year to ¥85.7 billion and accounted for 15.9% of consolidated revenue.

Domestic revenue increased by 0.6% from the same period in the prior year to ¥76.4 billion. In pipe- and infrastructure-related products, sales of ductile iron pipes and construction business decreased mainly due to a negative effect from postponed construction period along with a state of emergency. In environment-related products, sales of pumps increased significantly due to increased sales of drainage pump vehicles.

Overseas revenue increased by 4.8% from the same period in the prior year to ¥9.3 billion. Sales of construction business and other products increased.

Operating profit in this segment increased by 50.6% from the same period in the prior year to ¥12.5 billion mainly due to an improvement in plant construction costs.

3) Other

Other is mainly comprised of a variety of services.

Revenue in this segment decreased by 2.4% from the same period in the prior year to ¥7.5 billion and accounted for 1.4% of consolidated revenue.

Operating profit in this segment increased by 4.3% from the same period in the prior year to ¥1.0 billion.

(2) Financial condition

1. Assets, liabilities, and equity

Total assets at March 31, 2021 were ¥3,384.6 billion, an increase of ¥195.3 billion from the prior fiscal year-end. With respect to assets, the yen value of assets denominated in foreign currencies, such as finance receivables, increased significantly due to the yen depreciation compared with the prior fiscal year-end. In addition, trade receivables increased due to increased revenue in the domestic and overseas markets.

With respect to liabilities, the yen value of bonds and borrowings denominated in foreign currencies increased mainly due to the yen depreciation compared with the prior fiscal year-end and an increase in working capital. Equity increased due to an improvement in other components of equity along with fluctuations mainly in foreign exchange rates and the accumulation of retained earnings. The ratio of equity attributable to owners of the parent to total assets stood at 46.2%, 0.1 percent lower than the prior fiscal year-end.

1. Cash flows

Net cash used in operating activities during the three months ended March 31, 2021 was ¥22.5 billion, a decrease of ¥5.0 billion in net cash outflow compared with the same period in the prior year. This decrease was mainly due to an increase in profit for the period, despite an increase in cash outflow related to an increase in finance receivables and the changes in working capital, such as trade receivables.

Net cash used in investing activities was ¥18.4 billion, a decrease of ¥1.4 billion in net cash outflow compared with the same period in the prior year. This decrease was mainly due to an increase in cash inflow related to net decrease in restricted cash, despite an increase in cash outflow related to acquisition of property, plant, and equipment and intangible assets.

Net cash provided by financing activities was ¥0.8 billion, a decrease of ¥5.3 billion in net cash inflow compared

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