FY2022 Results and FY2023 Forecast

AC Business - China FY2022 Results Product supply delays due to the Shanghai lockdown in April and May shrank sales, but production and sales quickly recovered once the lockdown was lifted, and first half sales were on par with the previous fiscal year. In the second half, the strict movement restrictions to prevent virus spread caused a sales decline. but sales activities resumed aggressively even before the outbreak was under control. Consequently, full-year sales exceeded the previous fiscal year, partly due to the positive effect of exchange rates. Operating profit remained high from the sales expansion of high-value-added products, cost reductions, and lowering of fixed costs. In the Residential market, despite the restrictions on customer contact, we strengthened sales utilizing online activities such as developing new sales routes using live commerce, web advertising, and SNS that centered on our PROSHOP specialty stores. We also used customer data to obtain replacement demand. Capitalizing on growing customer interest in air quality and regulations on energy savings and combustion heating due to carbon neutrality policies, we enhanced Solutions proposals through sales of our unique system products that combine air conditioning, IAQ, heat reclamation ventilators, and heat pump floor heating. In the Commercial market, we focused on infrastructure-related, government projects, and capital investment projects of major companies where there is strong demand due to economic stimulus measures. In response to the promotion of carbon neutrality policies, we strengthened sales from the perspective of power reduction through energy solutions and air visualization for large buildings along with energy-saving equipment for factories. In the Applied market, we shifted resources to growth fields that include infrastructure and semiconductors and strengthened our maintenance and servicing business. FY2023 Forecast With the lifting of the zero-corona policy, the market is moving towards reopening. For this reason, we will actively develop offline sales such as direct proposals to customers and large-scale events that have been our strengths as we aim to expand sales by boosting our offline sales activities and focusing on identifying new customers. In the Residential market, we will quickly launch new products at an early stage to quickly respond to the changing market. In this way, we will look to expand our unique Housing Solutions business that combines such areas as air conditioning, ventilation, heating, and controls. In the Commercial market, not only will we launch new products exhibiting the industry's highest level of energy-saving performance, but we will also focus on developing systems and controllers to realize optimal energy management. Both hardware and software will be strengthened in the development of energy solutions. FY2023 Y/Y change (Local currency basis) Residential Commercial FY2022 Daikin Applied Market Daikin 91% 106% 110% 89% 107% 113% 97% 103% 105% 15

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