Revenue growth continues in FY2027-H1, but losses remain, with full-year operating profit dependent on a second-half recovery and normalization of expenses

First-quarter revenue was ¥9.7 billion, up 13.2% from ¥8.569 billion in the same quarter of the previous year. However, the operating result deteriorated from an operating loss of ¥606 million to an operating loss of ¥2.103 billion, while the ordinary loss was ¥2.084 billion and the net loss attributable to owners of the parent was ¥1.907 billion. Despite revenue growth, the operating loss widened, indicating at this stage that increased R&D investment is weighing on earnings much more heavily than revenue growth is supporting them.

The full-year forecasts are revenue of ¥45.7 billion, operating profit of ¥1.1 billion, ordinary profit of ¥500 million and net profit attributable to owners of the parent of ¥200 million. Starting from the first-quarter operating loss of ¥2.103 billion, a simple calculation indicates that cumulative operating profit must improve by at least ¥3.203 billion over the remaining three quarters to reach full-year operating profit of ¥1.1 billion. At the end of the first half, it will be necessary to assess not only actual operating profit, but also the extent to which the profit level required in the second half has been reduced.

R&D expenses are planned to increase from ¥16.761 billion in FY2026, or 41.6% of revenue, to ¥19.3 billion in FY2027, or 42.2% of revenue. This is almost the same proportion as the planned revenue increase, indicating that the structure in which progress in clinical development translates directly into higher expenses will continue. At the next results release, the focus will be on cumulative R&D expenses, the breakdown between global clinical trial and CRO expenses, the difference from the initial plan, and whether expenses slow in the second half.

The first-quarter earnings summary did not disclose quarterly cash-flow figures such as cash flow from operating activities, so it is not possible to determine the extent to which R&D expenses and capital investment are being funded by operating cash flow. The reportable segment is a single pharmaceutical business segment, and no breakdown of segment profit has been provided. Accordingly, in FY2027-H1 it will be necessary to assess product revenue, contract milestone income, R&D expenses, gross margin, operating results and cash flow together in order to test the achievability of the full-year forecasts.