Kirin Holdings Company (2503) Q2 2024 earnings summary

Executive summary

• Q2 FY2024 revenue rose 12.9% year-over-year to ¥1,095.8 billion, with normalized operating profit up 23.8% to ¥93.1 billion and profit attributable to owners up 78.9% to ¥57.2 billion, driven by strong overseas businesses and favorable foreign exchange rates.

• Operating profit more than doubled year-over-year, supported by strong segment performance and lower other operating expenses.

• All four business segments contributed to profit growth, with notable gains in Non-Alcoholic Beverages and Pharmaceuticals.

• Comprehensive income surged 68.3% to ¥226.6 billion, reflecting significant foreign currency translation gains.

• Upward revision of full-year revenue forecast, maintaining initial normalized OP target despite higher corporate tax expenses.

Financial highlights

• Q2 FY2024 revenue: ¥1,095.8bn, up 12.9% YoY; normalized OP: ¥93.1bn, up 23.8%; profit before tax: ¥108.5bn (+90.2% YoY); profit attributable to owners: ¥57.2bn (+78.9% YoY).

• Normalized EPS: ¥81, up 11.0% YoY; normalized EBITDA rose 18.1% to ¥139.5bn.

• Q2 segment revenue: Alcoholic Beverages ¥512.5bn (+6.6%), Non-Alcoholic Beverages ¥270.0bn (+12.0%), Pharmaceuticals ¥232.8bn (+17.0%), Health Science ¥69.6bn (+92.2%).

• Q2 segment normalized OP: Alcoholic Beverages ¥50.3bn (+11.9%), Non-Alcoholic Beverages ¥30.1bn (+31.0%), Pharmaceuticals ¥41.1bn (+13.7%), Health Science -¥1.6bn (improved from -¥4.4bn).

• Gross profit increased 15.4% YoY to ¥501.7bn, with gross margin improvement.

Outlook and guidance

• FY2024 revenue forecast revised upward to ¥2,300.0bn (+7.8% YoY); normalized OP target maintained at ¥202.0bn; profit attributable to owners forecast at ¥114.0bn.

• Normalized EPS forecast revised to ¥162; basic EPS for the year forecast at ¥140.76 due to higher tax expense; dividend per share unchanged at ¥71.

• ROIC forecast at 6.8% (down from 8.0% in FY23); guidance revision reflects higher revenue but lower profit expectations due to increased tax and lower other income.