Management of sustainability

Sustainability-linked bond

Sustainability-linked bond

Sustainability-linked bond

Komatsu issued Sustainability-Linked Bonds (USD-Denominated Senior Unsecured Straight Bonds) (hereafter “SLBs”) .
SLBs are bonds the terms and condition of which are subject to changes depending on the achievement status of the KPIs(*1) predetermined by the issuer. 
Under Komatsu’s three-year mid-term management plan to be completed in the fiscal year ending March 31, 2025, “DANTOTSU Value - Together, to  ‘The Next’  for sustainable growth”, Komatsu aims to create customer value that will contribute to ESG solutions and earnings growth through its growth strategies and intends to accelerate sustainability management targeting achievement of sustainable growth by this issuance of SLBs.

*1: KPI: Key performance indicators

 

Outline of the Bonds

  Sustainability-Linked Bonds
(USD Denominated Senior Unsecured Straight Bonds)
1. Issuer Komatsu Finance America Inc.
2. Guarantor Komatsu Ltd.
3. Issuance amount USD 600 million
4. KPI/SPT *2
  • SPT1.1: 45% reduction of the Scope 1+2 CO2 emissions (Intensity) (KPI1) from production by March 31, 2025 from 2010 baseline
  • SPT2.1: 24% reduction of the Scope 3 CO2 emissions (Intensity) (KPI2) from use of products by March 31, 2025 from 2010 baseline
5. Interest rate
  • 5.499% per year during the period from and including October 6, 2022 until October 5, 2025
  • From and including October 6, 2025, the interest rate shall be increased by 10 bps if SPT 1.1 has not been satisfied and increased by 15 bps if SPT 2.1 has not been satisfied as of March 31, 2025
6. Interest payment date April 6 and October 6 every year from and including April 6, 2023
7. Term 5 years
8. Maturity date October 6, 2027
9. Payment date  October 6, 2022 
10. Use of proceeds To be allocated for the redemption of outstanding bonds and general business purposes
11. Offering method Offerings in overseas markets, primarily in the U.S., Europe and Asia
(In the U.S., however, sales are solely for Qualified Institutional Buyers in accordance with Rule 144A under the U.S. Securities Act of 1933)
12. Market Singapore Exchange Securities Trading Limited
13. Credit Rating
  • A2 (Moody’s)
  • A (S&P)

*2 SPT:
Sustainability performance targets, which are measurable target figures of KPIs over the specific time period as stated by the issuer
 

Second party opinion of Sustainability-Linked Bond eligibility

With respect to eligibility against the Sustainability-Linked Bond Principles 2020 and the Sustainability-Linked Bond Guidelines (2022), Komatsu has obtained a second party opinion from DNV Business Assurance Japan K.K. , an internationally recognized third-party organization with expertise in this field.

 

Reporting

Komatsu reports the performance of the KPI/SPT on an annual basis.
In addition, the external verification result is attached.

【Performance of KPI/SPT】

KPI SPT Performance
March 31, 2025 March 31, 2024 March 31, 2023
KPI1: CO2 emissions (Intensity) from production SPT1.1: 45% reduction from 2010 baseline 51% reduction from the same 43% reduction from the same
KPI2: CO2 emissions (Intensity) from use of products SPT2.1: 24% reduction from 2010 baseline 22% reduction from the same 21% reduction from the same

【Verification】

Komatsu obtains an annual verification of the performance of the KPI/SPT from DNV Business Assurance JAPAN K.K..

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