Menicon Company (7780) Q1 2026 earnings summary

Executive summary

• Net sales for 1Q FY2025 rose 0.3% year-over-year to JPY 30.25 bn, driven by steady 1-DAY lens sales and Southeast Asia acquisitions, but profit declined due to upfront investments, sales mix changes, and lower Ortho-K sales in China.

• Operating profit dropped 26.9% year-over-year to JPY 1.96 bn, and profit attributable to owners fell 43.8% to JPY 0.99 bn, impacted by increased costs, foreign exchange losses, and a challenging Chinese market.

• EBITDA decreased 6.3% year-over-year to JPY 4.36 bn, with margin contraction due to higher depreciation and investment in new plant operations.

• Comprehensive income fell 76.7% year-over-year to JPY 1.13 bn.

Financial highlights

• Gross profit declined 2.5% year-over-year to JPY 16.1 bn, mainly due to lower Ortho-K sales in China.

• SGA expenses increased 2.2% year-over-year to JPY 14.15 bn, reflecting continued investment in growth initiatives.

• Ordinary profit decreased 35.6% year-over-year to JPY 1.77 bn, mainly due to foreign exchange losses.

• Total assets at quarter-end were JPY 182.63 bn, a decrease of JPY 4.96 bn from the previous fiscal year-end.

• Basic earnings per share was JPY 13.05, down from JPY 23.18 in the same quarter last year.

Outlook and guidance

• FY2025 consolidated forecasts remain unchanged: net sales JPY 125 bn, operating profit JPY 10.2 bn, profit attributable to owners JPY 5.8 bn.

• Net sales expected to rise due to price revisions in Japan, increased 1-DAY lens supply, and overseas expansion, offsetting economic stagnation in China and FX headwinds.

• Operating profit and EBITDA margins are projected to improve in 2H FY2025 as new plant operations ramp up and price increases take effect.

• Anticipates expanded global sales of silicone-based daily disposable lenses from Q2, supported by increased production and OEM introductions.

• Expects continued investment in production capacity while managing expenses to maintain profitability.