Towa Pharmaceutical (4553) Q3 2026 earnings summary

Executive summary

• Consolidated net sales for the nine months ended December 31, 2025, rose 5.3% year-over-year to ¥204.0 billion, with operating profit up 4.7% to ¥19.4 billion and profit attributable to owners up 16.8% to ¥17.0 billion, driven by higher production and sales volumes, especially in domestic generics and European B2B contract manufacturing.

• Ordinary profit increased 10.3% to ¥23.9 billion, aided by a ¥4.5 billion gain on derivative valuation not included in the original plan.

• Comprehensive income increased 37.1% year-over-year to ¥22.0 billion.

• Growth offset weaker performance at Sunsho Pharmaceutical, which faced higher cost of sales ratio and competitive pressures.

Financial highlights

• Net sales: ¥204.0 billion (+5.3% YoY); Operating profit: ¥19.4 billion (+4.7% YoY); Ordinary profit: ¥23.9 billion (+10.3% YoY); Profit attributable to owners: ¥17.0 billion (+16.8% YoY).

• Gross profit increased 6.2% YoY to ¥75.1 billion, with gross margin at 36.8%.

• Earnings per share for the nine months were ¥347.01, up from ¥297.10 YoY.

• Progress rates for full-year plan: Net sales 72.9%, Operating profit 72.2%, Ordinary profit 94.8%, Profit attributable to owners 96.5%.

• Cash and cash equivalents at period end were ¥39.6 billion.

Outlook and guidance

• Full-year plan remains unchanged due to uncertainties in the financial market and exchange rates.

• FY2026 forecast: Net sales ¥280.0 billion (+7.9% YoY), operating profit ¥27.0 billion (+16.2%), profit attributable to owners ¥17.7 billion (-6.8%), EPS ¥359.57.

• No revisions have been made to previously announced forecasts.

• Progress rates for net sales and operating profit are sluggish, but ordinary profit is strong due to derivative gains.