Meiji (2269) Q1 2025 earnings summary

Executive summary

• Q1 FY2024 net sales rose 6.1% year-over-year to ¥278.7bn, with operating profit up 5.1% and profit attributable to owners of parent up 20.3%, driven by both food and pharmaceutical segments.

• Food segment sales increased but operating profit declined due to higher raw material and marketing costs; pharmaceutical segment achieved strong growth in both sales and profit.

• Profit growth was supported by a decrease in tax expenses and extraordinary income from asset sales.

• The company is advancing its 2026 Medium-Term Business Plan, focusing on value-added products, B2B growth, and pharmaceutical innovation.

Financial highlights

• Net sales: ¥278.7bn (+6.1% YoY); operating profit: ¥20.4–20.5bn (+5.1% YoY); net income: ¥13.9–13.95bn (+20.3% YoY).

• EPS increased to ¥50.23 (+¥8.64 YoY).

• Gross profit margin improved to 29.4% from 29.0% YoY.

• Extraordinary income included gains on sale of investment securities, offset by losses on asset abandonment.

• Free cash flow was negative at -¥9.6bn, mainly due to increased inventories, decreased trade payables, and higher tax payments.

Outlook and guidance

• FY2024 full-year guidance maintained: net sales ¥1,159.0bn (+4.8% YoY), operating profit ¥86.0bn (+1.6–2.0% YoY), net income ¥50.0bn.

• Interim and year-end dividends projected at ¥50/share each, totaling ¥100/share for the year.

• ROE and ROIC expected to improve slightly to 7.0% each.

• No change to previously announced earnings forecasts.