For the 3 months ended March 31, 2022, revenue of Kubota Corporation and its subsidiaries increased by $430 million (+10.3%) from the same period in the prior year to $4.6 billion.

Domestic revenue decreased by $24 million (+2%) from the same period in the prior year to $1.2 billion because of decreased revenue in Farm & Industrial Machinery, despite increased revenue in Water & Environment.

Overseas revenue increased by $450 million (+15.5%) from the same period in the prior year to $3.4 billion because of increased revenue in Farm & Industrial Machinery, while revenue in Water & Environment remained at the same level as the same period in the prior year.

Operating profit decreased by $88 million (+14.6%) from the same period in the prior year to $510 million mainly due to some negative effects from a rise in material prices and an increase in logistics expenses, despite some positive effects from sales price increase and favorable impact of foreign exchange rates. Profit before income taxes decreased by $37 million (+6.1%) from the same period in the prior year to $570 million due to decreased operating profit. Income tax expenses were $150 million. Share of profits of investments accounted for using the equity method was $4 million. Profit for the period decreased by $23 million (+5.3%) from the same period in the prior year to $420 million. Profit attributable to owners of the parent decreased by $19 million (+4.7%) from the same period in the prior year to $38 million.

The Company’s research and development expenses for the 3 months ended March 31, 2022, were $140 million. There were no material changes in the Company’s research and development activities during the 3 months ended March 31, 2022.

Farm & Industrial Machinery

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

Revenue in this segment increased by 12.4% from the same period in the prior year to $3.9 billion and accounted for 84.2% of consolidated revenue.

Domestic revenue decreased by 4.4% from the same period in the prior year to $56 million. Sales of agricultural-related products decreased due to a decline in rice price and termination of subsidies for business continuation of farmers.

Overseas revenue increased by 15.9% from the same period in the prior year to $3.3 billion due to increased sales of farm equipment and construction machinery. By region, in North America, sales of construction machinery increased along with solid housing demand, although delay in procurement continued due to supply chain disruption. Sales of tractors and engines were also solid. In Europe, sales mainly of construction machinery and engines increased due to the stable market. In Asia outside Japan, sales of farm equipment, mainly tractors, in Thailand increased due to progress in developing dryland farming, while sales of farm equipment for rice farming decreased due to a decline in rice price. In China, sales of farm equipment were strong because customers, who anticipate lack of subsidy budgets, moved to purchase early.

Operating profit in this segment decreased by 13.1% from the same period in the prior year to $46 million due to some negative effects from a rise in material prices and logistics expenses, while there were some positive effects from sales price increase and favorable impact of foreign exchange rates.

The company reported $2.9 billion in revenue from its Farm Equipment & Engines segment, up 10.8% from $2.6 billion in its first quarter of 2021. Kubota reported $1,110.6 million (38.5%) of its farm equipment & engines revenue came from North America, up 17.2% from $948 million 1Q21.

Revenue from Kubota's tractor sales in North America totaled roughly $730 million in the first quarter of 2022, a 14% increase from $640 million in the same quarter last year.