Daikin weathers COVID storm with new AC unit and global plan

12 June, 2021

OSAKA - Daikin Industries, Japan's leading manufacturer of air conditioners, remains resilient amid the COVID-19 pandemic.

The company reported its first sales and profit declines in 11 years in the year ended March, but results were much better than initial forecasts and it expects a 13% jump in operating profit this year. Analysts attribute the company's strength to its ability to recognize its own weaknesses and quickly rectify them.

Daikin's group operating profit fell 10% on year to 238.6 billion yen ($2.17 billion) in fiscal 2020, mostly due to weak demand for air conditioning used in hotels, restaurants and other commercial establishments caused by a sluggish economy. "For Daikin, which operates globally, the impact of the pandemic was very serious," said President and CEO Masanori Togawa at an earnings briefing in mid-May.

Daikin had initially forecast a 40% decline in operating profit. This prompted Togawa to revise plans, halting the decline at only 10%. It has raised profit and sales forecasts four times since announcing the dire projection.

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