Otsuka (4578) Q2 2024 earnings summary

Executive summary

• Revenue for the six months ended June 30, 2024 rose 17.0% year-over-year to ¥1,108,930 million, driven by strong growth in pharmaceuticals and nutraceuticals.

• Business profit increased 37.8% to ¥213,622 million, while operating profit declined 3.4% to ¥126,279 million due to a ¥103,293 million impairment loss on AVP-786.

• Profit attributable to owners of the Company grew 5.1% to ¥107,795 million.

• Comprehensive income for the period was ¥264,541 million, up 13.8% year-over-year.

Financial highlights

• Gross margin improved as gross profit rose to ¥792,718 million from ¥659,674 million year-over-year.

• Basic earnings per share increased to ¥198.61 from ¥189.06 year-over-year.

• Total assets reached ¥3,660,630 million, up from ¥3,361,244 million at year-end 2023.

• Cash and cash equivalents decreased to ¥485,892 million, down ¥27,448 million from December 2023.

• Net cash provided by operating activities was ¥133,040 million, up ¥19,507 million year-over-year.

Outlook and guidance

• FY2024 revenue forecast revised upward to ¥2,315,000 million (up 14.7% year-over-year).

• Business profit forecast raised to ¥390,000 million (up 24.8%), but operating profit forecast lowered to ¥302,000 million due to impairment loss.

• Profit attributable to owners projected at ¥240,000 million (up 97.3%), with basic EPS of ¥443.01.

• Research and development expenses expected to increase to ¥326,000 million.

• Forecast incorporates impact of treasury share purchase and cancellation.