Chugai Pharmaceutical (4519) Q1 2025 earnings summary

Executive summary

• Revenue and profit increased significantly in Q1 2025, driven by strong overseas exports of in-house products, especially Hemlibra and Actemra, with revenue up 21.8%, operating profit up 36.6%, and net income up 30.5% year-on-year.

• Operating margin remained high at 48.4%, reflecting high profitability.

• Domestic sales remained flat due to NHI drug price revisions and generic competition, but new products like Phesgo and PiaSky performed well.

• Other revenue declined year-over-year due to reduced one-time income, despite higher Hemlibra-related income.

• Core results (excluding non-recurring items) showed operating profit up 36.6% and net income up 30.5% year-on-year.

Financial highlights

• Consolidated revenue rose by JPY 51.6 billion (21.8%) to JPY 288.5 billion; operating profit increased by JPY 37.4 billion (36.6%) to JPY 139.5 billion year-on-year.

• Net income after tax was JPY 99.2 billion, up JPY 23.2 billion (30.5%).

• Product sales reached JPY 259.7 billion, up 27%; overseas sales grew 54.7% to JPY 156.7 billion, while domestic sales were nearly flat.

• Cost-to-sales ratio improved by 1.8 points to 33.7% due to a favorable product mix.

• SG&A and R&D expenses both decreased slightly year-on-year.

Outlook and guidance

• Full-year revenue forecast: ¥1,190.0B; operating profit: ¥570.0B; net income: ¥410.0B; EPS: ¥250.00.

• Q1 progress toward full-year guidance: revenue 24.2%, operating profit 24.5%, net income 24.2%.

• Both revenue and operating profit are progressing at a higher rate than the previous year and are on track with initial projections.

• Uncertainties remain regarding the impact of potential U.S. tariffs and biosimilar launches.

• No changes to previously announced full-year forecasts.