Santen Pharmaceutical (4536) Q4 2026 earnings summary

Executive summary

• FY2025 core operating profit exceeded initial forecasts, with stable EPS growth despite a 2.8% revenue decline year-over-year, mainly due to NHI price revisions and generic competition in Japan, partially offset by new product launches and growth in Asia and EMEA.

• Net profit increased 4.8% year-over-year to ¥37.6 billion, with basic EPS rising to ¥114.04.

• Core operating profit fell 7.1% year-over-year to ¥55.1 billion, while IFRS operating profit rose 2.0% to ¥47.8 billion.

• FY2026 is forecasted to return to revenue and profit growth, driven by new product launches and overseas expansion.

• Strategic focus on strengthening the Rx portfolio, R&D, and business development for mid- to long-term growth.

Financial highlights

• FY2025 revenue: JPY 291.6 billion (-2.8% YoY); core OP: JPY 55.1 billion (-7.1% YoY); OP: JPY 47.8 billion (+2.0% YoY); EPS: JPY 114 (+9.7% YoY).

• FY2026/FY2027 revenue forecast: JPY 311.0 billion (+6.6% YoY); core OP: JPY 59.0 billion (+7.0% YoY); OP: JPY 49.5 billion (+3.6% YoY); EPS: JPY 124 (+9.1% YoY).

• All profit levels and EPS in FY2025 exceeded forecasts.

• Gross profit decreased 0.8% YoY to ¥169.7 billion; SG&A expenses rose 1.7% to ¥89.0 billion; R&D expenses increased 6.1% to ¥25.6 billion.

• EBITDA: JPY 63.6 billion in FY2025, forecasted JPY 67.8 billion in FY2026.

Outlook and guidance

• FY2026/FY2027 revenue forecast is JPY 311.0 billion (+6.6% YoY), with core operating profit of JPY 59.0 billion (+7.0%).

• Net profit forecast for FY2027 is JPY 39.5 billion (+5.2%), with basic EPS of JPY 124.42 (+9.1%).

• Dividend increase to JPY 42/share in FY2026/FY2027 (+JPY 4/share YoY), payout ratio of 34%, and opportunistic share buybacks planned.

• H2 FY2026 expected to be weighted for revenue and profit due to early maximization of new products and overseas expansion.

• Cost of sales ratio expected to fall to 40% due to product mix and productivity improvements.