Interim Performance Confirms Continuing Growth with Record Highs

Notes:
1) Consolidated financial information is prepared in accordance with generally accepted accounting principles in the United States of America. (U.S. GAAP)
2) The translation of Japanese yen amounts into US dollar amounts hereafter is included solely for convenience and has been made for the first half ended September 30, 2006 at the rate of ¥118 to $1, the approximate rate of exchange at September 30, 2006.
3) Equity in earnings of affiliated companies:
First half period ended September 30, 2006:1,316 million yen
First half period ended September 30, 2005:536 million yen
The entire fiscal year ended March 31, 2006:2,705 million yen
4) The numbers of average common shares outstanding were as follows:
First half period ended September 30, 2006:993,514,498
First half period ended September 30, 2005:992,145,951
The entire fiscal year ended March 31, 2006:992,733,616
5) Changes in accounting procedures since the last consolidated fiscal year: None.
6) Net income per share above is based on the provisions of Statement of Financial Accounting Standards No.128, "Earnings per share."
7) Operating income stated hereafter represents the amount in conformity with U.S. GAAP, as Komatsu Ltd. changed its form of consolidated statement of income from single- to multiple-step, starting in the first half period ended September 30, 2006. The previous operating income for the fiscal year ended March 31, 2006 and for the first half period ended September 30, 2005, are presented in conformity with U.S. GAAP to ensure comparability. [In the past, Komatsu presented operating profit as the sum of segment profit (net sales less cost of sales and selling, general and administrative expenses) in conformity with Japanese accounting principles and practices.]

Notes:
1) Forecast of net income per share (basic): 145.92 yen
2) Refer to "Management Performance and Financial Conditions" for preconditions of the projections above and other related issues.