Sawai Group Holdings Co (4887) Q1 2025 earnings summary

Executive summary

• Revenue grew 2.7% year-over-year to ¥44,328 million, driven by increased sales of both legacy and new products, and operating profit rose 31.6% year-over-year.

• Profit attributable to owners surged 340.2% year-over-year to ¥15,486 million, mainly due to a gain on the sale of the U.S. subsidiary.

• The U.S. business was fully divested on April 2, 2024, resulting in a one-time gain, and the company now operates as a single-segment entity focused on Japan.

• The company is executing a new medium-term management plan, emphasizing growth in generics, sustainability, and capital efficiency.

• Production volume for the quarter was 4.1 billion tablets, on track with the annual plan.

Financial highlights

• Revenue: ¥44,328 million (+2.7% YoY); Core operating profit: ¥6,884 million (+29.4% YoY); Operating profit: ¥6,092 million (+31.6% YoY).

• Profit before tax: ¥5,941 million (+29.6% YoY); Profit attributable to owners: ¥15,486 million (+340.2% YoY).

• Basic EPS: ¥353.54 (+340.1% YoY).

• EBITDA (adjusted): ¥9,885 million (+18.5% YoY).

• Cash and cash equivalents at period end: ¥55,470 million, up ¥29,102 million from March 31, 2024.

Outlook and guidance

• Revenue and profit are progressing in line with full-year forecasts, with 21.9% of revenue and 24.6% of core operating profit achieved.

• Aim to achieve forecasts by lifting shipment limitations and increasing sales of new and main products.

• FY2024 full-year revenue forecast: ¥202,000 million; Core operating profit: ¥28,000 million; EPS: ¥228.30 (post-stock split basis).

• The company is focused on steady growth in the generics market, sustainability, and investment in growth areas as outlined in its new medium-term plan.

• Industry reforms and regulatory changes in Japan are expected to further drive generic drug adoption.