FY2027 plan after the downward revision to be re-evaluated in the first half

On 24 September, the full-year consolidated earnings forecast for FY2027 was substantially revised. Revenue was reduced by ¥4,750 million, from the previous forecast of ¥41,850 million to ¥37,100 million, while the operating profit forecast shifted from a ¥2,050 million profit to a ¥2,050 million operating loss. Ordinary profit is forecast at ¥200 million, the net loss attributable to owners of the parent at ¥1,800 million, EPS at negative ¥32.96, and the annual dividend at ¥20.

Before the revision, first-quarter revenue was ¥8,833 million, up 1.2% year on year, while the operating loss widened to ¥943 million. First-quarter revenue progress was approximately 21.1% against the initial forecast of ¥41,850 million, below the 25% implied by an even quarterly allocation. However, the downward revision in September was made after the first-quarter results, so FY2027-H1 needs to be assessed against the revised plan.

Allocating the revised forecast evenly across the year gives a simple first-half revenue benchmark of ¥18,550 million and an operating loss benchmark of ¥1,025 million. The company, however, experiences significant quarterly fluctuations depending on product shipment timing, milestone-based royalties and overseas pharmaceutical sales, and a 50% allocation is not the company’s plan. At the next results announcement, the focus will be not only on cumulative first-half revenue and operating results, but also on whether the revised forecast is maintained or revised further.

The company identified a substantial decline in royalty income and revenue as the main reasons for the revision, but the revision disclosure did not specify the contribution by product or region or provide a detailed breakdown of the increase in manufacturing costs. In FY2027-H1, disclosure of revenue and profit by the Pharmaceuticals and LAL segments, royalty income recorded and the breakdown of non-operating income will be key to assessing the validity of the full-year loss forecast.