<PAGE>
FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
REPORT OF FOREIGN ISSUER
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of November, 2000
COMMISSION FILE NUMBER: 1-7239
KOMATSU LTD.
...............................................
Translation of registrant's name into English
3-6 Akasaka 2-chome, Minato-ku, Tokyo, Japan
............................................
Address of principal executive offices
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INFORMATION TO BE INCLUDED IN REPORT
------------------------------------
1. One company announcement made on November 1, 2000.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
KOMATSU LTD.
--------------------------------------
(Registrant)
Date: November 1 , 2000 By: /s/ Masaru Fukase
------------------------------------
Masaru Fukase
Senior Executive Officer
<PAGE>
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NEWS RELEASE
Komatsu Ltd.
2-3-6 Akasaka, Minato-ku,
Tokyo 107-8414, Japan
Public Relations Section
Tel: +81-3-5561-2616
0055(1656)
November 1st, 2000
URL: http://www.komatsu.com/
KOMATSU ANNOUNCES CONSOLIDATED INTERIM RESULTS
FOR FISCAL 2001 AND OUTLOOK FOR THE REST OF THE YEAR
--------------------------------------------------------------------------------
The accompanying financial information is prepared in accordance with generally
accepted accounting principles in the United States of America.
Komatsu Ltd. posted consolidated net sales of Yen554.5 billion (US$5,135
million, at US$1=Yen108) for the interim period of fiscal 2001 ending March 31,
2001, registering an increase of 7.5% over the corresponding period last year.
Operating income for the period grew 599.3%, to Yen12.8 billion (US$119
million). Net income for the period declined 65.8%, to Yen3.1 billion (US$29
million).
Millions of yen and US dollar, except per share amounts
--------------------------------------------------------------------------------
2001 2000 2001
--------------------------------------------------------------------------------
Net sales Yen 554,530 Yen 515,843 $ 5,135
Japan 288,922 250,027 2,675
Overseas 265,608 265,816 2,459
Operating income 12,839 1,836 119
Net income (loss) 3,152 9,226 29
Net income (loss) per share --- Basic Yen 3.29 Yen 9.52 cents 3.05
--------------------------------------------------------------------------------
1. Business Results by Operation
Construction and Mining Equipment
---------------------------------
Sales of construction and mining equipment for the interim period declined 4.5%
from the corresponding period a year ago, to Yen362.9 billion (US$3,360
million), consisting of Yen 142.7 billion (US$1,322 million), up 3.8% in Japan
and Yen220.1 billion (US$2,039 million), down 9.2% outside of Japan.
During the period under review, Japanese demand for construction equipment
declined slightly, and Komatsu teamed up with its distributors across the
country and continued to strengthen the program to provide valuable services and
information to customers from their viewpoint. Komatsu also continued its
efforts to expand sales of minimal rear-swing radius hydraulic excavators and
other major products and the domain of the environmental business. As a result,
Komatsu increased sales for the period in Japan. For the rental equipment
industry, Komatsu embarked on full-scale efforts to introduce the "KOMTRAX," a
satellite-based construction equipment operation management system
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which is designed to improve overall business efficiency of the rental business
through enhanced machine utilization, faster response to any maintenance needs,
and other advantages. Komatsu introduced this system to two affiliated rental
companies during the period with a plan to introduce it to other affiliated
rental companies.
Komatsu also accelerated the pace of organizational and functional
consolidation, discontinuing the branch network in October 2000 and linking the
Japanese Marketing Division and distributors directly. At the same time, Komatsu
established new area offices in major regions of Japan to strengthen regionally
tuned marketing and support to local distributors and rental companies.
With respect to production, Komatsu transferred Komatsu Zenoah Co.'s
production of agricultural and forestry machinery from its Tachikawa Head Office
Plant and production of mini hydraulic excavators from its Saitama Plant to the
new Kawagoe Head Office Plant of Komatsu Zenoah, the plant site of the former
MEC Division. Komatsu also transferred production of mini hydraulic excavators
of smaller than 4 tons from its Awazu Plant to the Kawagoe Head Office Plant of
Komatsu Zenoah. With these three transfers done on schedule, Komatsu
successfully completed the restructuring program that was initiated in 1998.
In North America, the United States economy remained strong on a macro
level, and new construction investment continued to expand during the period.
However, signs of slowdown in new housing starts of the private sector began to
emerge, and demand for new construction equipment declined from that of the
previous corresponding period. This decline may also have been caused by the
mood of saturation in the market as a reaction to the high level of demand for a
long period as well as expansion of rental and used equipment markets. Under
such an environment of this major market, Komatsu worked to reinforce regionally
tailored marketing and promote sales expansion of the rental business, while
continuing to improve production efficiency. However, North American sales of
construction equipment dropped from the last corresponding period, resulting in
the major factor for reduced earnings of the construction and mining equipment
business for Komatsu.
In Europe, demand for construction equipment remained brisk, and Komatsu
companies promoted aggressive sales and continued to advance sales on a local
currencies basis. In response to the depreciated euro, Komatsu reduced
production costs by expanding local procurement of parts and components and
facilitating exports outside of Europe. However, earnings decreased from the
corresponding period last year.
In Southeast Asia, demand for equipment began to recover, centering on the
mining and forestry industries. In the buoyant Chinese market, Komatsu extended
its product range for production. As a result, Komatsu accelerated sales in both
regions. Komatsu also expanded sales in the Middle and Near East regions where a
steady increase in demand for construction equipment was supported by price
hikes of crude oil, and in the Commonwealth of Independent States where demand
upturned in the oil and natural gas industries.
Utility equipment business continued to boost sales thanks to expanded
growth in demand in Europe and brisk sales of backhoe loaders in North America,
the largest market for utility equipment, where demand has remained strong and
where Komatsu launched full-scale sales of backhoe loaders last year.
Anticipating further growth into the future, in October this year, Komatsu
decided to build a new plant for utility equipment in South Carolina, U.S.A.
With an initial plan to produce four models of backhoe loaders in 2002,
construction is starting in December this year. Komatsu is well prepared to
accelerate sales in this promising market.
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Mining equipment business saw some signs of recovery in demand for dump
trucks against the backdrop of increased price for copper. However, this stopped
short of full recovery for demand, leaving the difficult management environment
in place.
Electronics
-----------
Sales from the electronics business improved 33.0% over the corresponding
period last year, to Yen55.5 billion (US$515 million). The semiconductor market
recovered rapidly, supported by burgeoning demand for information and
telecommunication products such as PCs and mobile phones. With the improvement
of demand for silicon wafers, Komatsu Electronic Metals, Co., Ltd. engaged in
aggressive sales activities both at home and abroad, expanding sales volume of
200mm wafers, the mainstay size on the market today. The company also worked to
build strong corporate muscle and recover profitability through company-wide
programs centering on the enhancement of technology development and product
competitiveness, reinforcement of sales and service networks, and restructuring
of production in Japan. Formosa Komatsu Silicon Corporation, a subsidiary of
Komatsu Electronic Metals, continued to advance mass production in progress with
customers' evaluation and approval.
Advanced Silicon Materials LLC. in the United States experienced slow sales
of polycrystalline silicon as adversely affected by inventory adjustments in the
silicon wafer manufacturing industry. The company also accommodated the burden
of amortization of the new plant in Butte, Montana. As a result, the company
registered a loss for the period. Meanwhile, Komatsu Electronics, Inc. welcomed
an outstanding increase in demand for its micro modules, which are used to
control the temperature of semiconductor lasers for fiber optic communications.
The growth in demand was mainly propelled by the shift to the new Wavelength
Division Multiplexing method in the United States. As a result, the company
recorded more-than-planned earnings for the period, contributing to improved
earnings of the electronics business as a whole.
Concerning the Excimer laser business, Komatsu established GIGAPHOTON INC.,
a company accounted for by the equity method, jointly with USHIO INC., a leading
Japanese manufacturer of industrial lamps in August 2000. The joint venture
engages in research and development, manufacturing, sales, service and other
operations for Excimer lasers used for lithography tools in semiconductor
manufacturing.
GIGAPHOTON is well positioned to converge USHIO's solid reputation in the
reliability of products, and strong sales and service networks in Japan and
overseas and Komatsu's state-of-the-art technologies and manufacturing system.
GIGAPHOTON is working to make an eminent presence in the global market.
Others
------
Sales of the industrial machinery, logistics and other businesses for the period
advanced 44.7% to Yen136.0 billion (US$1,259 million).
In the industrial machinery business, Komatsu Industries Corporation, in
charge of sheet metal forming machinery and small and medium-sized presses,
posted profits for the period. In addition to positive outcomes of the thorough
restructuring program since July 1999, this accomplishment reflects expanded
sales of strategic products such as the solid frame press E2W series and twister
fine plasma cutting machine TFP series.
With respect to the large press business, Komatsu worked to improve sales
in North America and Europe with a special emphasis on engineering business.
During the period, together with Hitachi Zosen Corporation and Hitachi Zosen
Fukui Co., Komatsu decided on
<PAGE>
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joint materials sourcing for large and medium-sized presses in order to reduce
their purchase prices.
To enhance the competitiveness of its forklift truck business, Komatsu
Forklift Co., Ltd., now a consolidated subsidiary, reached an agreement with
Linde AG of Germany to build a cooperative relationship in production and sales.
While promoting the "Proposal for Total Logistics" campaign to customers,
Komatsu Forklift also introduced renewed models of the engine-powered and
battery-powered series. The company expanded both sales and profits over the
corresponding period a year earlier. Meanwhile, sales and profits of Komatsu
Construction Ltd. declined from the corresponding period last year.
2. Conditions of Consolidated Cash Flows
Net cash provided by operating activities for the interim period amounted to
Yen21.2 billion (US$197 million), net cash provided by investing activities to
Yen0.6 billion (US$6 million), and net cash used in financing activities to
Yen47.5 billion (US$441 million). As a result, cash and cash equivalents at the
end of the year totaled Yen54.7 billion (US$507 million).
3. Important Decisions Made or Important Facts Occurred and Important Subsequent
Events Occurred during the Year
Komatsu Forklift Becomes Consolidated Subsidiary
------------------------------------------------
To enhance the competitiveness of the forklift truck business, the Company and
Komatsu Forklift Co., Ltd. signed a basic contract with Linde AG of Germany in
May 2000, outlining their intent to cultivate global collaboration for the
manufacture and sales of lift trucks and related products. In June, Komatsu
Forklift acquired 10% of Linde subsidiary, Fiat OM Carrelli Elevatori S.p.A.
shares, while Linde obtained 10% of Komatsu Forklift shares by purchasing new
shares through third-party allotment. The Company underwrote part of the
allotment and purchased Komatsu Forklift shares from the open market, increasing
its equity holding in Komatsu Forklift to 50.8%. As a result, Komatsu Forklift
is now a consolidated subsidiary of the Company.
Komatsu Soft Shares Transferred to Toyo Information Systems
-----------------------------------------------------------
As part of its efforts to strengthen involvement in IT, the Company has decided
to establish a partnership relation with Toyo Information Systems Co., Ltd. in
the area of core systems. In April 2000, the Company transferred 65% of the
outstanding shares of Komatsu Soft Ltd. to Toyo Information Systems. As a
result, Komatsu Soft changed its status for the Company from a consolidated
subsidiary to a company accounted for by the equity method.
Komatsu Construction Shares Transferred to TAKAMATSU
----------------------------------------------------
In October 2000, the Company and Komatsu Group companies transferred the equity
shares held in Komatsu Construction Co., Ltd. to TAKAMATSU CORPORATION which has
an abundant track record as a leading builder of rental-use condominiums in the
Tokyo and Osaka metropolitan areas. The transfer took place in the form of the
Company and Komatsu Group companies complying with a takeover bid by TAKAMATSU.
As a result of this transfer, the Company is better positioned to focus its
management resources on the core business of construction and mining equipment
and other businesses where it can demonstrate its superiority in technologies.
By carrying out this growth strategy, the Company is going to enhance the
corporate value of the Komatsu
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Group.
Repurchase and Retirement of Komatsu's Own Shares
-------------------------------------------------
At the Board of Directors meeting held on May 2, 2000, the Company resolved to
appropriate retained earnings in order to repurchase and retire its own shares
up to a maximum aggregate acquisition cost of Yen7.0 billion or up to a maximum
of 10 million par value common shares pursuant to Article 3 of the Law
Concerning Special Exceptions to the Commercial Code Relating to the Procedures
for Cancellation of Shares. Based on this resolution, the Company repurchased 10
million par value common shares with an aggregate acquisition cost of Yen6,340
million and retired them in May 2000.
4. Outlook for the Rest of Fiscal 2001
For the construction and mining equipment business, the Company is firmly
positioned to generate stable earnings in the Japanese market. Outside of Japan,
the Company projects that Southeast Asian markets will recover, while it is
concerned that demand may decline in the North American market. In Europe,
depreciation of the euro is another concern for the Company. Keeping such
possibilities in mind, the Company is going to conduct customer-focused, locally
tailored business in different regions of the world in order to secure earnings
and head for new growth. At the same time, the Company will proactively deploy
IT and look into the life cycle of construction equipment in order to deliver
solutions to customers.
In the electronics, engineering and other businesses, the Company is going
to focus management resources in the areas where it can demonstrate
technological superiority on a global scale according to the "G" to the 21st
mid-range management strategy. Resolutely determined to improve its performance,
the Company is also going to innovate its internal business structure and
emphasize the creation of new businesses through IT.
With these efforts already in progress, the Company projects consolidated
net sales of Yen1,090 billion and net income of Yen8 billion for fiscal 2001
ending March 31, 2001. Foreign exchange rates are premised at Yen105 to US$1 and
Yen90 to EUR1 for the second half period of fiscal 2001.
<PAGE>
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--------------------------------------------------------------------------------
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.
--------------------------------------------------------------------------------
Management Policy
Basic Management Policy
The cornerstone of Komatsu's management lies in its commitment to Quality and
Reliability. This commitment is not limited to delivering safe and innovative
products and services. We are also continuing our efforts to enhance the Quality
and Reliability of all organizations, businesses, employees and management of
the entire Komatsu Group.
"G" to the 21st Mid-Range Management Strategy
In April this year, we launched the "G" to the 21st mid-range management
strategy for a period of three years, extending to fiscal year ending March 31,
2003. Now that our electronics business is repositioned to generate stable
earnings as a result of our efforts coupled with improved market conditions, we
have clearly expressed our principal management stance in which we are doubling
our efforts more exclusively in our core business of construction and mining
equipment in the "G" to the 21st strategy. We believe that "globalization,"
"environment" and "e-KOMATSU" are the keywords for our growth in the coming
century.
Construction and Mining Equipment
For the interim period ended September 30, 2000, Komatsu improved both
consolidated Japanese sales and operating income over the corresponding period
last year, while demand for construction equipment declined slightly in the
Japanese market. With on-schedule
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completion in August 2000 of the restructuring of Japanese production which was
initiated two years ago, Komatsu has secured a foundation to generate stable
earnings, even when market demand remains at the current level. Meanwhile,
consolidated sales outside of Japan declined due mainly to a decrease in demand
in North America, a major market of the world, and belated recovery in demand
for mining equipment.
Komatsu has a solid foundation with the advantages of global sales, service and
production networks, brand strength substantiated by Quality and Reliability,
and in-house production of key components. By capitalizing on these advantages
and anticipating changes in the management environment, we are going to improve
earnings of our construction and mining equipment business. As part of this
commitment, we have recently signed a letter of intent with Galveston-Houston
Company of the United States to acquire Hensley Industries, Inc., a
Galveston-Houston wholly owned subsidiary which manufactures and sells buckets,
teeth and adapters for construction and mining equipment. We also decided to
build a new plant for exclusively for utility equipment in North America.
We have also set a new course for growth by delivering solutions in the
life cycle of construction and mining equipment, and have identified IT
(information technology) as our key to success in this area.
Komatsu has been promoting global, Groupwide utilization of IT as an
effective technology and method to differentiate ourselves from our competitors.
For development and production, Komatsu has already gained substantial results
in reduction of inventories, lead-time and logistics costs through the
enterprise resource planning system. In April this year, we created the
e-Komatsu Division to step up our efforts in IT utilization which maximizes our
strengths and originalities. We are aggressively introducing the KOMTRAX
construction equipment operation management system, which considerably improves
earnings of the rental business by reducing overall costs, to rental companies
of the Komatsu Group.
Our customers are also very concerned about environment-related problems in
their business. Komatsu works to solve their problems by providing construction
equipment specifically designed for environmental conservation and other
equipment installed with environment-friendly engines, hydraulic equipment and
other components. We are also pleased to report that our annual Environmental
Report, published in May this year, has been well received. It describes our
past and present environmental activities in technology development, production,
marketing, product support and other operations, and it also clearly defines our
future directions.
Electronics
With earnings power recovered, our electronics business is positioned for
profitability. With the upturning of market conditions for silicon wafers and
stabilization of their price, Komatsu Electronic Metals Co., Ltd. substantially
improved its performance over the preceding six-month period. Through production
in Japan and Taiwan, the company has been making all-out efforts to ensure the
best quality, delivery and cost for customers, and has achieved steady results.
In August 2000, we established GIGAPHOTON INC. jointly with USHIO INC. of
Japan. By converging our technological advantage and our partner's sales and
service network, this joint venture is expected to reinforce its global
competitiveness as Japan's only supplier of Excimer lasers for steppers in
semiconductor manufacturing.
Supported by proliferation of fiber optic communication networks mainly in
the United States, Komatsu Electronics, Inc. generated more-than-planned
earnings from its
<PAGE>
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micro modules. Komatsu Electronics is well prepared to sustain continued growth
by solidifying its position as a market leader with internationally superior
technology.
Others
In October 2000, Komatsu and the Komatsu Group transferred 69.15% of the
outstanding shares held in Komatsu Construction Co., Ltd. to TAKAMATSU
CORPORATION. This is a manifestation of our principal management strategy to
enhance our corporate value by focusing our management resources on the
businesses in which we can demonstrate our superiority in technologies and/or
industries. We decided to entrust Komatsu Construction to TAKAMATSU with its
original strategies and sound business records so that Komatsu Construction
would be able to improve earnings
Interim Dividends
Concerning cash dividends to shareholders, it is our basic policy that Komatsu
redistributes profits by taking payout ratios into account and linking returns
more directly with business results, while ensuring sufficient internal reserves
for reinvestment. Based on this policy, we have decided Yen3.00 (US (cents)
2.78) for interim dividends per share in the Board of Directors meeting on
November 1, 2000.
We are resolutely determined to further advance our self-innovation in
management and technology, while responding correctly to changes in the world
such as IT, in our efforts to accomplish the goals of the "G" to the 21st
mid-range management strategy. With the new century just around the corner, we
are going to do our best to make Komatsu a company where each and every employee
is creative and ready to take on challenges.
Consolidated Financial Highlights
---------------------------------
For the first six months of fiscal 2001 and 2000 ended September 30, 2000 and
1999, respectively.
<TABLE>
<CAPTION>
Millions of yen & US dollars
except per share amounts
------------------------------------------------------------------------------------------------------------------
2001 2000 Changes(2001-2000)
Apr.1-Sept.30,2000 Apr.1-Sept.30,1999 Increase(Decrease)
-------------------------------------------------------------------------------------------
Yen Dollar Yen Yen (%)
<S> <C> <C> <C> <C> <C>
</TABLE>
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<TABLE>
<S> <C> <C> <C> <C> <C>
------------------------------------------------------------------------------------------------------------------
Net sales 554,530 5,135 515,843 38,687 7.5
Japan 288,922 2,675 250,027 38,895 15.6
Overseas 265,608 2,459 265,816 (208) (0.1)
------------------------------------------------------------------------------------------------------------------
Income before 11,195 104 12,612 (1,417) (11.2)
Income taxes
------------------------------------------------------------------------------------------------------------------
Net income 3,152 29 9,226 (6,074) (65.8)
(loss)
------------------------------------------------------------------------------------------------------------------
Net income (loss)
per share
Basic Yen 3.29 (cent) 3.05 Yen 9.52 Yen (6.23) -
Diluted --- --- Yen 9.40 --- -
------------------------------------------------------------------------------------------------------------------
</TABLE>
Note:
1) . Number of consolidated subsidiaries : 125 companies
. Number of affiliated companies : 172 companies (including 47
companies accounted for by the equity method)
2) The translation of Japanese yen amounts into US dollar amounts is
included solely for convenience and has been made for 2001 at the rate
of Yen108 to $1, the approximate rate of exchange at September 30,
2000.
3) The diluted net income per share computations for fiscal 2001 were not
dilutive.
Financial Position
-------------------
(As of September 30, 2000 and 1999)
--------------------------------------------------------------------------------
2001 2000
--------------------------------------------------------------------------------
Total assets (Millions of yen) 1,388,875 1,516,071
--------------------------------------------------------------------------------
Shareholders' equity (Millions of yen) 472,002 521,337
--------------------------------------------------------------------------------
Equity ratio (%) 34.0 34.4
--------------------------------------------------------------------------------
Shareholders' equity per share (Yen) 493.46 538.06
--------------------------------------------------------------------------------
Projection for FY2001
---------------------
(From April 1, 2000 to March 31, 2001)
Millions of yen
--------------------------------------------------------------------------------
Net sales Income before income taxes Net income
--------------------------------------------------------------------------------
The entire FY2001 1,090,000 23,000 8,000
--------------------------------------------------------------------------------
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Consolidated Balance Sheets
---------------------------
(As of September 30, 2000 and 1999)
<TABLE>
<CAPTION>
Millions of yen
------------------------------------------------------
2001 2000 Changes
Increase(Decrease)
-------------------------------------------------------------------------------------------------------
(A) (B) (A)-(B)
Assets
------
<S> <C> <C> <C>
Current assets:
Cash and cash equivalents Yen 54,713 Yen 62,320 Yen (7,607)
Time deposits 899 1,600 (701)
Marketable securities 1,196 126 1,070
Trade notes and accounts receivable 388,019 378,828 9,191
Inventories 238,458 241,751 (3,293)
Other current assets 104,450 93,781 10,669
-------------------------------------------------------------------------------------------------------
Total current assets 787,735 778,406 9,329
-------------------------------------------------------------------------------------------------------
Investments 101,304 194,805 (93,501)
-------------------------------------------------------------------------------------------------------
Property, plant, and equipment -
Less accumulated depreciation 426,502 442,192 (15,690)
-------------------------------------------------------------------------------------------------------
Other assets 73,334 100,668 (27,334)
-------------------------------------------------------------------------------------------------------
Total 1,388,875 1,516,071 (127,196)
-----
-------------------------------------------------------------------------------------------------------
Liabilities and Shareholders' Equity
------------------------------------
Current liabilities:
Short-term debt (including current 237,525 280,944 (43,419)
maturities of long-term debt)
Trade notes and accounts payable 209,221 178,068 31,153
Income taxes payable 7,729 6,180 1,549
Other current liabilities 125,561 124,342 1,219
-------------------------------------------------------------------------------------------------------
Total current liabilities 580,036 589,534 (9,498)
-------------------------------------------------------------------------------------------------------
Long-term liabilities 288,544 369,697 (81,153)
-------------------------------------------------------------------------------------------------------
Minority interests 48,293 35,503 12,790
-------------------------------------------------------------------------------------------------------
Shareholders' equity:
Common stock 67,870 68,370 (500)
Capital surplus 117,366 117,269 97
Retained earnings 320,326 324,645 (4,319)
Accumulated other (31,809) 12,674 (44,483)
Comprehensive income (*)
Treasury stock (1,751) (1,621) (130)
-------------------------------------------------------------------------------------------------------
Total shareholders' equity - net 472,002 521,337 (49,335)
-------------------------------------------------------------------------------------------------------
Total Yen 1,388,875 Yen 1,516,071 Yen (127,196)
-----
-------------------------------------------------------------------------------------------------------
<CAPTION>
------------------------------------------------------------------
2001 2000 Changes
Increase(Decrease)
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
(*)Accumulated other comprehensive income:
Foreign currency translation adjustments Yen (39,427) Yen (22,037) Yen (17,390)
Net unrealized holding gains on securities available 12,151 40,161 (28,010)
for sale
Pension liability adjustments Yen (4,533) Yen (5,450) Yen 917
</TABLE>
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Consolidated Statements of Income
---------------------------------
(For the six months ended September 30, 2000 and 1999)
<TABLE>
<CAPTION>
Millions of yen
--------------------------------------------------------------
2001 2000 Changes
Increase(Decrease)
-----------------------------------------------------------------------------------------------------------------------
(A) (B) (A)-(B) %
<S> <C> <C> <C> <C>
Revenues
Net sales Yen 554,530 Yen 515,843 Yen 38,687 7.5
Interest and other income 19,649 32,287 (12,638)
-----------------------------------------------------------------------------------------------------------------------
Total 574,179 548,130 26,049 4.8
-----------------------------------------------------------------------------------------------------------------------
Costs and expenses
Cost of sales 409,592 397,270 12,322
Selling, general and administrative expenses 132,099 116,737 15,362
Interest expense 21,293 21,511 (218)
-----------------------------------------------------------------------------------------------------------------------
Total 562,984 535,518 27,466 5.1
-----------------------------------------------------------------------------------------------------------------------
Income before income taxes, minority interests, and 11,195 12,612 (1,417) (11.2)
equity in earnings
-----------------------------------------------------------------------------------------------------------------------
Income taxes 8,631 1,394 7,237
-----------------------------------------------------------------------------------------------------------------------
Minority interests in income (losses) of 54 (1,924) 1,978 --
consolidated subsidiaries - net
-----------------------------------------------------------------------------------------------------------------------
Equity in earnings (losses) of affiliated companies 534 (68) 602 --
- net
-----------------------------------------------------------------------------------------------------------------------
Net income Yen 3,152 Yen 9,226 Yen (6,074) (65.8)
-----------------------------------------------------------------------------------------------------------------------
</TABLE>
Note: Komatsu's comprehensive income (loss) consists of net income, change in
foreign currency translation adjustments, change in net unrealized
holding gains on securities available for sale, and change in pension
liability adjustments. Aggregated net comprehensive income (loss) for
the years ended September 30, 2000 and 1999 were (9,067) million yen and
29,336 million yen, respectively.
<PAGE>
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Consolidated Statements of Cash Flows
-------------------------------------
(For the six months ended September 30, 2000 and the year ended March 31, 2000)
<TABLE>
<CAPTION>
Millions of yen
---------------------------------------------------------------------------------------------------------------
2001 2000 Apr.1,
Apr. 1-Sept. 30, 2000 1999-Mar. 31, 2000
---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Net cash provided by operating activities Yen 21,268 Yen 34,224
---------------------------------------------------------------------------------------------------------------
Net cash provided by (used in) investing activities 607 18,880
---------------------------------------------------------------------------------------------------------------
Net cash provided by (used in) financial activities (47,584) (61,565)
---------------------------------------------------------------------------------------------------------------
Effect of exchange rate change on cash and cash equivalents (54) 1,636
---------------------------------------------------------------------------------------------------------------
Net increase (decrease) in cash and cash equivalents (25,763) (6,825)
---------------------------------------------------------------------------------------------------------------
Cash and cash equivalents, beginning of year 80,476 87,301
---------------------------------------------------------------------------------------------------------------
Cash and cash equivalents, end of year Yen 54,713 Yen 80,476
---------------------------------------------------------------------------------------------------------------
</TABLE>
Note: The consolidated statements of cash flows for the corresponding period
ended September 30, 1999 were not prepared, nor disclosed last year.
<PAGE>
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Business Information
--------------------
1. Information by Business Unit
(1) Sales and Operating Profit (Loss)
<TABLE>
<CAPTION>
Millions of yen
------------------------------------------------------------------------------------------------------
2001 2000
Apr. 1-Sept. 30, 2000 Apr. 1-Sept. 30, 1999
---------------------------------------------------------------------------
Operating Margin Operating Margin
Sales Profit(Loss) % Sales Profit(Loss) %
------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Construction &
Mining Equipment 366,297 13,300 3.6 389,009 14,827 3.8
------------------------------------------------------------------------------------------------------
Electronics 55,823 (2,520) (4.5) 41,829 (10,279) (24.6)
------------------------------------------------------------------------------------------------------
Others 162,171 3,992 2.5 115,276 (1,306) (1.1)
------------------------------------------------------------------------------------------------------
Total 584,291 14,772 2.5 546,114 3,242 0.6
------------------------------------------------------------------------------------------------------
Corporate &
Elimination (29,761) (1,933) --- (30,271) (1,406) ---
------------------------------------------------------------------------------------------------------
Total 554,530 12,839 2.3 515,843 1,836 0.4
------------------------------------------------------------------------------------------------------
</TABLE>
Note: Sales amount of each business unit includes inter-unit transactions.
(2) Assets, Depreciation, and Capital Expenditures
<TABLE>
<CAPTION>
Millions of yen
-------------------------------------------------------------------------------------------------------------------------
2001 2000
----------------------------------------------------------------------------------------------
As of Apr. 1-Sept. 30, 2000 As of Apr. 1-Sept. 30, 1999
Sept. 30 Sept. 30
-------------------------------------------------------------------------------------------------------------------------
Assets Depreciation Capital Assets Depreciation Capital
and Expenditures and Expenditures
Amortization Amortization
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Construction &
Mining Equipment 746,382 14,693 15,085 798,523 15,528 21,819
-------------------------------------------------------------------------------------------------------------------------
Electronics 236,944 9,680 3,783 257,150 11,561 4,297
-------------------------------------------------------------------------------------------------------------------------
Others 533,452 8,197 11,208 497,888 3,706 3,185
-------------------------------------------------------------------------------------------------------------------------
Total 1,516,778 32,570 30,076 1,553,561 30,795 29,301
-------------------------------------------------------------------------------------------------------------------------
Corporate &
Elimination (127,903) --- --- (37,490) --- ---
-------------------------------------------------------------------------------------------------------------------------
Total 1,388,875 32,570 30,076 1,516,071 30,795 29,301
-------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
-16-
2. Geographic Information
(1) Net Sales Recognized By Sales Destination
Millions of yen
------------------------------------------------------------------------------
2001 2000
Apr. 1-Sept. 30, 2000 Apr. 1-Sept. 30, 1999
------------------------------------------------------------------------------
Japan 288,922 250,027
------------------------------------------------------------------------------
Americas 129,787 136,153
------------------------------------------------------------------------------
Europe 66,019 60,056
------------------------------------------------------------------------------
Asia (excluding Japan) 58,128 51,372
and Oceania
------------------------------------------------------------------------------
Middle East and Africa 11,674 18,235
------------------------------------------------------------------------------
Consolidated net sales 554,530 515,843
------------------------------------------------------------------------------
(2) Net Sales Recognized By Geographic Origin And Long-lived Assets
<TABLE>
<CAPTION>
Millions of yen
--------------------------------------------------------------------------------------------------------------------
2001 2000
Apr. 1-Sept. 30, 2000 Apr. 1-Sept. 30, 1999
------------------------------------------------------------------------------------
Net Sales Long-lived Assets Net Sales Long-lived Assets
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Japan 322,099 312,442 283,974 299,696
--------------------------------------------------------------------------------------------------------------------
U.S.A 131,310 126,980 134,833 165,944
--------------------------------------------------------------------------------------------------------------------
Europe 58,851 8,772 56,363 14,504
--------------------------------------------------------------------------------------------------------------------
Others 42,270 29,082 40,673 31,961
--------------------------------------------------------------------------------------------------------------------
Total 554,530 477,276 515,843 512,105
--------------------------------------------------------------------------------------------------------------------
</TABLE>
3. Information by Region
<PAGE>
-17-
(1) Sales and Operating Profit (Loss)
<TABLE>
<CAPTION>
Millions of yen
---------------------------------------------------------------------------------------------------------------------
2001 2000
Apr. 1-Sept. 30, 2000 Apr.1 -Sept. 30, 1999
------------------------------------------------------------------------------------------
Sales Operating Margin Operating Margin
Profit(Loss) % Sales Profit(Loss) %
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Japan 399,882 12,655 3.2 354,306 (7,143) (2.0)
---------------------------------------------------------------------------------------------------------------------
Americas 134,783 (677) (0.5) 138,982 5,325 3.8
---------------------------------------------------------------------------------------------------------------------
Europe 63,817 2,799 4.4 63,951 3,305 5.2
---------------------------------------------------------------------------------------------------------------------
Others 42,375 (45) (0.1) 41,640 927 2.2
---------------------------------------------------------------------------------------------------------------------
Total 640,857 14,732 2.3 598,879 2,414 0.4
---------------------------------------------------------------------------------------------------------------------
Corporate &
Eliminations (86,327) (1,893) --- (83,036) (578) ---
---------------------------------------------------------------------------------------------------------------------
Total 554,530 12,839 2.3 515,843 1,836 0.4
---------------------------------------------------------------------------------------------------------------------
</TABLE>
Note: Sales amount of each region segment includes inter-segment transactions.
(2) Assets
<TABLE>
<CAPTION>
Millions of yen
--------------------------------------------------------------------------------------------------------
2001 2000
As of Sept. 30, 2000 As of Sept. 30, 1999
-----------------------------------------------------------------------------
Assets Ratio(%) Assets Ratio(%)
--------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Japan 1,028,885 74.1 969,248 63.9
--------------------------------------------------------------------------------------------------------
Americas 321,932 23.2 375,593 24.8
--------------------------------------------------------------------------------------------------------
Europe 77,062 5.5 89,595 5.9
--------------------------------------------------------------------------------------------------------
Others 91,786 6.6 85,428 5.7
--------------------------------------------------------------------------------------------------------
Total 1,519,665 109.4 1,519,864 100.3
--------------------------------------------------------------------------------------------------------
Corporate &
Eliminations (130,790) (9.4) (3,793) (0.3)
--------------------------------------------------------------------------------------------------------
Total 1,388,875 100.0 1,516,071 100.0
--------------------------------------------------------------------------------------------------------
</TABLE>
4. Export Sales
Millions of yen
-----------------------------------------------------------------------------
2001 2000
Apr. 1-Sept. 30, 2000 Apr. 1-Sept. 30, 1999
-----------------------------------------------------------------------------
Export sales 53,873 35,540
-----------------------------------------------------------------------------
Note: Export sales represent the sales of the company and its domestic
consolidated subsidiaries to unaffiliated customers in foreign countries.
<PAGE>
-18-
Consolidated Sales by Operation
-------------------------------
(For the six months ended September 30, 2000 and 1999)
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------
2001 2000 Changes
Apr. 1-Sept. 30, 2000 Apr. 1-Sept. 30, 1999 Increase (Decrease)
-----------------------------------------------------------------------------------
Yen Million Ratio(%) Yen Million Ratio(%) Yen Million (%)
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Construction Japan 142,726 25.8 137,567 26.7 5,159 3.8
-------------------------------------------------------------------------------------------------
& Mining Overseas 220,193 39.7 242,464 47.0 (22,271) (9.2)
-------------------------------------------------------------------------------------------------
Equipment 362,919 65.5 380,031 73.7 (17,112) (4.5)
----------------------------------------------------------------------------------------------------------------------
Electronics Japan 37,140 6.7 28,787 5.6 8,353 29.0
-------------------------------------------------------------------------------------------------
Overseas 18,459 3.3 13,013 2.5 5,446 41.9
-------------------------------------------------------------------------------------------------
55,599 10.0 41,800 8.1 13,799 33.0
----------------------------------------------------------------------------------------------------------------------
Others Japan 109,056 19.7 83,673 16.2 25,383 30.3
-------------------------------------------------------------------------------------------------
Overseas 26,956 4.9 10,339 2.0 16,617 160.7
-------------------------------------------------------------------------------------------------
136,012 24.5 94,012 18.2 42,000 44.7
----------------------------------------------------------------------------------------------------------------------
Total Japan 288,922 52.1 250,027 48.5 38,895 15.6
-------------------------------------------------------------------------------------------------
Overseas 265,608 47.9 265,816 51.5 (208) (0.1)
-------------------------------------------------------------------------------------------------
554,530 100.0 515,843 100.0 38,687 7.5
----------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
-19-
Financial Instruments
---------------------
1. Derivative Financial Instruments
<TABLE>
<CAPTION>
Millions of Yen
------------------------------------------------------------------------------------- ------------------------------------
2001 2000
1st Half
As of Sept. 30, 2000 As of Mar. 31, 2000
------------------------------------ ------------------------------------
Contract, Carrying Estimated Contract, Carrying Estimated
Notional Amounts Fair Value Notional Amounts Fair Value
Amounts Amounts
------------------------------------------------------------------------------------ ------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Foreign exchange contracts 2,455 50 227 9,559 96 133
FY 2000
Purchase of foreign currencies
the equivalent of yen 19,196
Sale of foreign currencies
the equivalent of yen 28,755
FY 2001 (1st Half)
Purchase of foreign currencies
the equivalent of yen 21,226
Sale of foreign currencies
the equivalent of yen 23,681
Interest rate swap, currency swap and 257,763 52 11,253 250,615 45 14,704
interest rate cap agreements
------------------------------------------------------------------------------------ ------------------------------------
</TABLE>
<PAGE>
-20-
2. Marketable Securities and Investment Securities
<TABLE>
<CAPTION>
Millions of yen
---------------------------------------------------------------------- ---------------------
2001 2000
1st Half
As of Sept. 30, 2000 As of Mar. 31, 2000
---------------------------------------------------------------------- ---------------------
<S> <C> <C>
Marketable securities available for
sale
Marketable equity securities
Cost 1,094 167
Fair value 1,089 133
Gross unrealized holding (5) (34)
gains (losses)
Marketable debt securities
Cost 107 107
Fair value 107 107
Gross unrealized holding 0 0
Gains (losses)
Investment Securities available for
sale
Marketable equity securities
Cost 37,536 61,072
Fair value 61,124 105,260
Gross unrealized holding 23,586 44,188
gains (losses)
Marketable debt securities
Cost 10 3
Fair value 10 11
Gross unrealized holding 0 8
Gains (losses)
---------------------------------------------------------------------- ---------------------
</TABLE>
Financial Highlights of the Parent Company
------------------------------------------
<PAGE>
-21-
The following financial information is prepared based on the non-consolidated
financial results of the parent company in accordance with generally accepted
accounting principles and practices in Japan.
<TABLE>
<CAPTION>
Financial Results Millions of yen & US dollars
except per share amounts
-----------------------------------------------------------------------------------------------------------------
2001 2000 Changes (2001-2000)
Apr. 1-Sept. 30, 2000 Apr. 1-Sept. 30, 1999 Increase (Decrease)
-----------------------------------------------------------------------------------------------------------------
Yen Dollar Yen Yen (%)
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net sales 206,929 1,916 210,558 (3,628) (1.7)
Japan 131,833 1,221 128,013 3,819 3.0
Overseas 75,096 695 82,544 (7,448) (9.0)
-----------------------------------------------------------------------------------------------------------------
Operating 4,804 44 3,910 893 22.9
income
-----------------------------------------------------------------------------------------------------------------
Ordinary 4,307 40 1,071 3,236 302.1
income
-----------------------------------------------------------------------------------------------------------------
Net income 3,719 34 7,184 (3,465) (48.2)
-----------------------------------------------------------------------------------------------------------------
Net income Yen 3.87 (cents) 3.58 Yen 7.41 Yen (3.54) ---
per share
-----------------------------------------------------------------------------------------------------------------
</TABLE>
Note:
1. The translation of Japanese yen amounts into United States dollar
amounts is included solely for convenience and has been made for
2001 at the rate of Yen108 to $1, the approximate rate of
exchange at September 29, 2000.
2. The numbers of average common shares outstanding were as follows:
. September 30, 2000 --- 961,435,362
. September 30, 1999 --- 968,921,701
. March 31, 2000 --- 968,921,701
Dividends
-------------------------------------------------------------------------------
2001 2000
-------------------------------------------------------------------------------
Cash dividends per share (Yen)
Interim 3.00 3.00
Year-end --- 3.00
-------------------------------------------------------------------------------
Financial Position
-------------------
(At September 30, 2000 and 1999)
-------------------------------------------------------------------------------
2001 2000
-------------------------------------------------------------------------------
Total assets (Millions of yen) 752,793 746,044
-------------------------------------------------------------------------------
Shareholders' equity (Millions of yen) 478,652 465,639
-------------------------------------------------------------------------------
Equity ratio (%) 63.6 62.4
-------------------------------------------------------------------------------
Shareholders' equity per share (Yen) 499.16 480.57
-------------------------------------------------------------------------------
Sales by Operation
------------------
(For the six months ended September 30, 2000 and 1999)
<PAGE>
-22-
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------
2001 2000 Changes
Apr. 1-Sept. 30, 2000 Apr. 1-Sept. 30, 1999 (2001-2000)
-------------------------------------------------------------------------------
Yen Million Ratio(%) Yen Million Ratio(%) Yen Million (%)
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Construction Japan 104,924 50.7 103,319 49.1 1,605 1.6
---------------------------------------------------------------------------------------------
& Mining Overseas 71,198 34.4 78,591 37.3 (7,393) (9.4)
---------------------------------------------------------------------------------------------
Equipment 176,122 85.1 181,910 86.4 (5,788) (3.2)
------------------------------------------------------------------------------------------------------------------
Electronics Japan 4,145 2.0 5,415 2.6 (1,269) (23.4)
---------------------------------------------------------------------------------------------
Overseas 2 0.0 --- --- 2 ---
---------------------------------------------------------------------------------------------
4,148 2.0 5,415 2.6 (1,266) (23.4)
------------------------------------------------------------------------------------------------------------------
Others Japan 22,763 11.0 19,279 9.2 3,483 18.1
---------------------------------------------------------------------------------------------
Overseas 3,895 1.9 3,952 1.9 (57) (1.4)
---------------------------------------------------------------------------------------------
26,659 12.9 23,232 11.0 3,426 14.8
------------------------------------------------------------------------------------------------------------------
Total Japan 131,833 63.7 128,013 60.8 3,819 3.0
---------------------------------------------------------------------------------------------
Overseas 75,096 36.3 82,544 39.2 (7,448) (9.0)
---------------------------------------------------------------------------------------------
206,929 100.0 210,558 100.0 (3,628) (1.7)
------------------------------------------------------------------------------------------------------------------
<CAPTION>
Projection for FY2001
---------------------
(From April 1, 2000 to March 31, 2001)
Millions of yen
------------------------------------------------------------------------------------------------------------------
Net sales Ordinary Income Net income
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
The entire FY2001 435,000 12,000 8,000
------------------------------------------------------------------------------------------------------------------
</TABLE>
