Astellas Pharma (4503) Q1 2025 earnings summary

Executive summary

• Revenue for Q1 FY2024 increased by 26.2% year-on-year to ¥473.1 billion, driven by strong performance of XTANDI and strategic brands, especially in the U.S.

• Strategic brands sales tripled year-on-year to ¥75.0 billion, with robust growth from Padcev, Izervay, Veozah, Vyloy, and Xospata.

• Core operating profit rose 20.5% year-on-year to ¥88.3 billion, with significant contributions from XTANDI and new brands.

• SG&A and R&D expenses increased as planned to support future growth, with timely cost management focused on ROI.

• Growth was offset by MYRBETRIQ declines due to US generics, while US, Established Markets, China, and International Markets saw revenue increases.

Financial highlights

• Q1 revenue: ¥473.1 billion, up 26.2% year-on-year; FX impact contributed ¥45.4 billion.

• Core operating profit: ¥88.3 billion, up 20.5% year-on-year; operating profit: ¥50.7 billion, up 10.6% year-on-year.

• Net profit: ¥37.6 billion, up 13.5% year-on-year.

• SG&A expenses: ¥206.9 billion, up 23.0%; R&D expenses: ¥86.8 billion, up 34.4%.

• Free cash flow was negative at -¥26.7 billion, mainly due to increased investing activities.

Outlook and guidance

• On track to achieve FY2024 initial forecast; revenue forecast: ¥1,650.0 billion, core operating profit forecast: ¥250.0 billion.

• Expecting continued growth for XTANDI, Padcev, Izervay, Veozah, Vyloy, and Xospata, with further launches and label expansions anticipated.

• Anticipate further sales expansion for strategic brands, aiming for ¥300 billion in FY24 and ¥500 billion in FY25.

• FX sensitivity: 1 yen depreciation in USD adds ¥6.1 billion to revenue and ¥0.3 billion to core OP.

• Monitoring potential impact of Medicare Part D changes on XTANDI from Q3.