FY2027-H1 is the point at which the feasibility of the projected return to profitability will be assessed based on revenue-recognition timing and earnings levels

Revenue in the first quarter of the fiscal year ending March 2027 was ¥215.4 million, a substantial increase from ¥24.9 million in the same quarter of the previous year. Operating loss was ¥170.6 million, ordinary loss was ¥133.9 million and net loss for the quarter was ¥134.2 million. The main driver of the revenue increase was final milestone revenue under a licence agreement with an overseas pharmaceutical company, but the company remained loss-making at the operating level because it continued its research and development and business development activities.

The full-year forecasts are revenue of ¥1,100–1,500 million, operating profit of ¥5–50 million, ordinary profit of ¥45–90 million and net profit of ¥45–90 million. First-quarter revenue represented approximately 14.4–19.6% of the full-year range, below the 25% elapsed-quarter benchmark. If the first half is simply assumed to account for half of the full year, cumulative revenue of ¥550–750 million in the second quarter would be one benchmark for assessment. However, the company’s revenue is linked to contract execution and development progress, so even recognition cannot be assumed.

On earnings, the company plans to generate a full-year operating profit despite carrying a first-quarter operating loss of ¥170.6 million. If cumulative operating income were to recover to ¥0 million or more by the second quarter, operating earnings would need to improve by at least approximately ¥170.6 million in the second quarter alone. Because results can vary substantially depending on when upfront contract payments and milestones are recognised, the degree of conversion into operating profit, rather than revenue growth alone, needs to be assessed.

The first quarter was reported on a non-consolidated basis, and the company plans to prepare consolidated financial statements from the second quarter following the acquisition of Mediproduce. Accordingly, in FY2027-H1 it will be necessary to distinguish not only year-on-year comparisons but also the increase in revenue and operating income, or increase in expenses, resulting from the change in the scope of consolidation. Whether the company simultaneously discloses that its forecasts remain unchanged, the breakdown of contract revenue and the contribution from the consolidated subsidiary will be key points in assessing the credibility of its plan to return to profitability.