Chugai Pharmaceutical (4519) Q1 2026 earnings summary

Executive summary

• Q1 FY2026 saw revenue rise 11.5% year-over-year to ¥321.7 billion, with operating profit up 17.1% and net income up 19.6%, driven by strong domestic and overseas sales, especially Hemlibra and NEMLUVIO exports and related royalty income.

• Growth was supported by mainstay and new products, including Vabysmo, Hemlibra, Polivy, Phesgo, Lunsumio, and the launch of ELEVIDYS (gene therapy for DMD); approvals for Lunsumio/Polivy combination and new formulations for Enspryng.

• The development pipeline advanced with key filings, approvals, study initiations, and several project discontinuations based on outcomes.

• The company maintained a balanced board composition and emphasized ongoing corporate governance enhancements.

Financial highlights

• Revenue reached ¥321.7 billion (+11.5% YoY); core operating profit was ¥163.3 billion (+17.1% YoY); net income was ¥118.6 billion (+19.6% YoY); EPS increased to ¥72.03 (+19.5% YoY).

• Domestic sales grew 8.2% to ¥111.4 billion; overseas sales rose 14.9% to ¥180.1 billion, with positive FX impact.

• Operating margin improved to 52.8%; cost to sales ratio declined by 2.0 percentage points YoY to 31.7%.

• Equity ratio attributable to owners rose to 84.2%.

• Free cash flow was ¥112.2 billion, but net cash decreased by ¥129.6 billion due to dividend payments.

Outlook and guidance

• Q1 performance was on track with initial expectations; no changes to published full-year forecasts.

• FY2026 revenue forecast is ¥1,345.0 billion (+6.9%), core operating profit ¥670.0 billion (+7.5%), and core net income ¥485.0 billion (+7.5%).

• Management expects SG&A expenses to trend lower from Q2 and year-end SG&A to be below prior year; R&D and SG&A expenses tracking in line with expectations.

• Export growth for Hemlibra is expected to remain in the low single-digit range for the full year.