Japan Lifeline (7575) investor relations material

Executive summary

• Achieved record-high net sales of JPY 59.18B (+4.6% YoY), operating profit of JPY 12.60B (+2.3%), and net income of JPY 9.35B (+0.4%), driven by robust core products and expansion in neurovascular and gastrointestinal segments.

• FY2027 guidance projects net sales of JPY 63.20B (+6.8%), but operating profit and net income are expected to decline due to higher SG&A, R&D, and one-time HQ relocation costs.

• Strategic focus on proprietary product sales, global expansion, and leadership in niche markets, with continued execution of the medium-term management plan.

• Overcame headwinds from higher personnel/R&D costs, inventory write-downs, and relocation expenses.

Financial highlights

• Gross profit rose to JPY 35.17B (+2.9% YoY), with gross margin at 59.4% (down 100bps YoY) due to product mix and reimbursement cuts.

• Operating margin was 21.3% for FY2026, with net margin at 15.8%.

• EPS reached JPY 133.30; international sales mix increased to 2.5%; cash balance rose by JPY 1,479M.

• One-time costs included JPY 295M in inventory write-downs and JPY 108M in relocation losses.

Outlook and guidance

• FY2027: net sales JPY 63.20B (+6.8%), operating profit JPY 10.70B (-15.1%), net income JPY 8B (-14.4%).

• Gross margin expected to compress to 57.9%, operating margin to 16.9%, due to inflation and higher input costs.

• Dividend per share set at JPY 56 (49.1% payout), exceeding standard policy.

• FY2028 targets: net sales JPY 70B, OP margin ~20%, EPS JPY 145, ROIC 13%.