Q1 Financial Summary for the Fiscal Year Ending March 2026 (Consolidated, Japanese GAAP)

Business Performance Overview

The consolidated financial results for the first quarter of the fiscal year ending March 2026 show net sales of 126.3 billion yen, an increase of 2.9% from the same period last year. Sales of new pharmaceuticals (domestic) reached 87.1 billion yen (35% increase), new pharmaceuticals (overseas) reached 0.7 billion yen (922% increase), and sales of generic drugs totaled 38.5 billion yen (37% increase). Operating profit declined by 71.6% to 3.6 billion yen, and ordinary income decreased by 69.5% to 4.0 billion yen. Net income attributable to owners of the parent was 3.4 billion yen, down 62.0%. R&D expenses increased by 14.7% to 12.1 billion yen. The increase in selling, general and administrative expenses is a major factor in the profit decline.

Outlook

Although sales are expected to grow for Beova, Rasuvik, and Mucodyne, overall revenue is projected to decline due to decreases in Desalex sales following the entry of generic competitors. R&D expenses are expected to decrease due to reduced upfront payments and trial costs, but operating profit is forecasted to decline due to drug price revisions and decreased gross profit margin. The cost of sales ratio is expected to rise by about 3 percentage points, while the selling, general, and administrative expense ratio excluding R&D expenses is expected to remain nearly flat.