Sawai Group Holdings Co (4887) Q2 2025 earnings summary

Executive summary

• Revenue for the six months ended September 30, 2024, was JPY 87,870 million, up 0.5% year-over-year; core operating profit increased 0.8% to JPY 12,575 million; profit attributable to owners surged 123.8% to JPY 18,901 million, mainly from the U.S. business divestiture.

• Results fell short of initial forecasts due to trust restoration activities, but unit selling price improved, reflecting efforts to maintain product value.

• The U.S. business was fully divested in April 2024, resulting in a one-time gain and a shift to a single-segment structure focused on Japan.

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

Financial highlights

• Operating profit increased by JPY 864 million year-over-year to JPY 11,755 million; EPS rose to 146.25 yen (+127.6% YoY); gross profit margin stable at 31.1%.

• Profit attributable to owners rose by JPY 10,457 million to JPY 18,901 million, mainly due to the gain on the U.S. business sale.

• Cash and cash equivalents at period end: JPY 49,660 million, up JPY 23,292 million.

• Total assets decreased to JPY 363,748 million from JPY 382,024 million as of March 31, 2024.

• Free cash flow for 1H FY2024: JPY 21,910 million.

Outlook and guidance

• Revised full-year forecast: revenue to increase 4.0% to JPY 183.9 billion, core operating profit up 6.1% YoY; 2H revenue and core operating profit expected to rise 7.3% and 11.7% YoY, respectively.

• Focus on increasing sales volume, launching new products, and expanding market share.

• Ongoing initiatives include R&D in formulation technologies, digital health collaborations, and cost reduction.