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Investing.com -- Daikin reported second-quarter operating profit of ¥125.3 billion, down 4% year-on-year but largely in line with company plans and analyst expectations.
The air conditioning manufacturer’s quarterly performance was affected by several factors, including a ¥6 billion negative impact from foreign exchange, ¥21 billion from raw materials, ¥18 billion from fixed costs and other expenses, and ¥11.4 billion from broader sales. These negative factors were partially offset by ¥29 billion in positive contributions from selling price increases and ¥21.5 billion from cost-cutting measures.
Regional air conditioner sales showed mixed results during the quarter. Japan remained stable with 2% year-on-year growth, while Europe, China, and other Asian markets continued to show weakness. The American market performed better with 6% growth despite the stronger yen, which the company noted was a solid result given challenging market demand conditions.
Daikin maintained its full-year operating profit guidance while adjusting several components of its forecast. The company added ¥13.5 billion year-on-year for foreign exchange effects, ¥7 billion for raw materials including tariff impacts, ¥9.5 billion for fixed costs, ¥18 billion for selling prices, and ¥16 billion for cost reduction initiatives.
These positive adjustments aim to offset a projected ¥64 billion negative contribution from wider sales and lower volumes, with the company focusing on improved selling prices and reduced fixed costs to maintain its annual targets.
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