Chugai Pharmaceutical (4519) Q2 2026 earnings summary

Executive summary

• Revenue for H1 FY 2026 rose 14.7% year-over-year to JPY 663.3 billion, driven by strong domestic and overseas sales, and significant growth in royalty and one-time income.

• Core operating profit reached JPY 329.1 billion, up 21% year-on-year, and net income after tax was JPY 238.4 billion, up 23.2%.

• Eight regulatory applications were filed in Japan, with expectations for a record number of filings this year, and two Phase 3 studies for NXT007 were initiated.

• Key pipeline progress includes new launches for NEMLUVIO and Foundayo, and Fast Track designation for AQUA07 by the US FDA.

• Strong performance in oncology and specialty products, with Hemlibra, Vabysmo, and Elevidys contributing to growth.

Financial highlights

• Revenue for H1 FY 2026 was JPY 663.3 billion, up 14.7% year-on-year; sales reached JPY 566.5 billion (+10.8% YoY), with domestic sales up 6.5% and overseas sales up 14.1%.

• Core operating profit was JPY 329.1 billion (+21% YoY); net income after tax was JPY 238.4 billion (+23.2% YoY).

• Other revenue, including royalties and one-time income, increased by JPY 29.8 billion, with total other revenue at JPY 96.8 billion (+44.5% YoY).

• Cost of sales rose 11.8%, with a cost-to-sales ratio of 34.6%.

• EPS increased to JPY 144.84 (+23.2% YoY); free cash flow was JPY 227.0 billion (+84.9% YoY).

Outlook and guidance

• On track to achieve full-year forecasts, with H1 progress rates at 49.3% for revenue, 49.1% for operating profit, and 49.2% for net income.

• Full-year 2026 revenue forecast is JPY 1,345.0 billion (+6.9%), core operating profit JPY 670.0 billion (+7.5%), and core net income JPY 485.0 billion (+7.5%).

• Annual dividend forecast of JPY 132 per share, marking 10 consecutive years of increases, with a targeted payout ratio of 44.7–45% of Core EPS.

• No revision to business performance forecast at this stage, but performance is slightly better than expected.

• Anticipates higher sales in the latter half of the year, with progress rates ahead of last year.