Kyowa Kirin Co ((JP:4151)) has held its Q2 earnings call. Read on for the main highlights of the call.
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Kyowa Kirin Co. recently held its earnings call, presenting a mixed sentiment with both notable achievements and ongoing challenges. The company reported significant growth in key products like Crysvita and Poteligeo, alongside promising advancements in research and development. However, these positives were tempered by decreased revenue and profits, largely due to restructuring impacts in Japan and the APAC region.
Crysvita Sales Growth
Crysvita’s global sales for the first half of the year increased by 10% year-over-year to JPY99.8 billion. This growth was driven by strong performances in North America and EMEA, bolstered by increased treatment among adult patients and effective promotional activities.
Poteligeo Revenue Increase
Poteligeo also saw a 14% year-over-year increase in global revenue, reaching JPY21.6 billion. The success was attributed to strategic promotional strategies utilizing AI, with notable growth in North America and Europe.
Successful R&D and Pipeline Progress
Kyowa Kirin’s research and development efforts have yielded promising results, particularly with Ziftomenib, which has shown favorable safety and efficacy in trials and has been submitted for FDA approval. Rocatinlimab is also progressing well, showing potential for unique treatment value.
Decreased Revenue and Profit
The company faced a 1% decrease in revenue, with core operating profit falling by 21% and interim profit dropping by 57%. These declines were due to factors such as NHI price reductions and extra retirement payments.
Japan Sales Decline
Sales in Japan fell by 9%, impacted by terminated marketing agreements, NHI price revisions, and decreased sales of certain products.
APAC Region Restructuring Impact
Restructuring in the APAC region led to a JPY6.5 billion decline in sales, contributing to the overall decrease in global revenue.
Increased R&D Expenses
R&D expenses rose by JPY3.3 billion, affecting core operating profit, although these expenses were in line with planned progress.
Forward-Looking Guidance
Kyowa Kirin provided guidance for the fiscal year ending December 31, 2025, noting a 1% decrease in revenue to JPY230.7 billion, primarily due to APAC restructuring and NHI price reductions in Japan. Despite a 21% decline in core operating profit and a 57% drop in interim profit, the company remains optimistic about achieving its full-year targets. Crysvita and Poteligeo’s strong growth in North America and EMEA are expected to continue, and the company anticipates revenue and gross profit to align with expectations as they typically rise in the latter half of the fiscal year.
In summary, Kyowa Kirin’s earnings call highlighted a balanced sentiment with both achievements and challenges. While facing decreased revenue and profits due to restructuring impacts, the company showed strong growth in key products and promising R&D advancements. The forward-looking guidance reflects a commitment to achieving full-year targets through strategic sales growth and operational efficiencies.