Top Message FAQ policy notes

To All Our Stakeholders

Business Results

During the fiscal year, ended March 31, 2010, i.e., from April 1, 2009 to March 31, 2010, some economies of the world generated signs of recovery, reflecting positive effects of the economic stimulus packages of their respective governments. In particular, leading other economies, the Chinese economy upturned for full-momentum growth in the first half, supported by the government's massive economic stimulus measures. The positive effects of the Chinese economic growth are reaching to surrounding Asian countries and those with natural resources, helping their economic recovery. However, the pace of economic recovery was dull in Japan, North America and Europe, bringing about a challenging overall business environment.

We, at the Komatsu Group, engaged in production adjustment around the world and achieved an appropriate level of inventories in the first half. We also reorganized production of businesses of both the Construction, Mining and Utility Equipment and the Industrial Machinery and Others, while realigning sales of construction equipment and forklift trucks in Japan. At the same time, we worked to substantially cut down fixed costs. To ensure sales and profits, we reinforced ICT-deployed businesses, such as the KOMTRAX (Komatsu Machine Tracking System), strengthened operations in China and mining equipment, in which business was expanding, and worked to strengthen the parts and service business. However, as affected by global demand, which did not come back to the level of the pre-financial meltdown and the Japanese yen's appreciation against major currencies, both sales and profits declined from the previous fiscal year.

Consolidated Results for the Year

Note: "Net income attributable to Komatsu Ltd." is equivalent to "Net income" for the fiscal year ended March 31, 2009 and preceding fiscal years.

Mid-Range Management Strategies and Goals

Today, market demand for construction and mining equipment has upturned for recovery in China and other emerging countries in Asia and Latin America. We anticipate that economic growth in these emerging countries will drive global demand upward. In April this year, we kicked off the new mid-range management plan "Global Teamwork for Tomorrow." We have positioned China, Asia, Oceania, Latin America, Africa and some other emerging economies as "Strategic Markets," and we are working to drive further growth.

We are further strengthening our corporate governance to ensure sound and transparent management, while improving management efficiency. Being committed to promoting thorough compliance, we will also ensure that all employees share The KOMATSU Way. In addition to improving our business performance, we will facilitate the development of both corporate strength and social responsibility in a well balanced manner.

On behalf of the members of the Board, we would like to extend our sincere appreciation to our valued shareholders, customers, and business partners around the world for their support.

July 2010

Masahiro Sakane
Chairman of the Board

Kunio Noji
President and CEO