In today’s briefing:
- Medipal Holdings (7459 JP): Started FY24 On a Strong Note with Accelerated Revenue
- Sumitomo Pharma (4506 JP): Pain Continues with Dwindling Sales; Trial Setback Worsens Outlook
- Sinopharm Group (1099.HK) 23H1 – Strong Growth Would Continue, but Profit Margin Is Under Pressure
Medipal Holdings (7459 JP): Started FY24 On a Strong Note with Accelerated Revenue
- Medipal Holdings (7459 JP) announced strong Q1FY24 result, with a 6% YoY revenue growth to ¥887B, driven by growth across all three business segments.
- However, operating profit declined 8% YoY to ¥12B, mainly due to increase in SG&A expenses. Driven by an extraordinary income of ¥3.3B, net profit jumped 35% YoY to ¥11B.
- The company has reaffirmed FY24 guidance, which calls for a 4.5% YoY revenue growth, flat operating profit, and a 9.3% YoY decline in net profit.
Sumitomo Pharma (4506 JP): Pain Continues with Dwindling Sales; Trial Setback Worsens Outlook
- Sumitomo Pharma (4506 JP) recorded 53% YoY and 21% QoQ decline in Q1FY24 revenue to ¥75.7B, mainly due to the impact of the loss of exclusivity for Latuda in U.S.
- Sumitomo’s schizophrenia drug candidate ulotaront missed primary endpoints in phase 3 trial. Clinical setback on one of the two phase 3 drug candidates is quite a blow for the company.
- Sumitomo reaffirmed FY24 guidance, which calls for revenue decline of 35% YoY to ¥362B. The company guided for adjusted operating loss of ¥62B and net loss of ¥80B in FY24.
Sinopharm Group (1099.HK) 23H1 – Strong Growth Would Continue, but Profit Margin Is Under Pressure
- Sinopharm’s performance growth in 23H1 was satisfactory, but both gross profit margin and net profit margin decreased, which was mainly related to generic drugs VBP and medical device centralized procurement.
- Profitability could continue to be under pressure in the short term. In the long term, Sinopharm’s business transformation and new value-added businesses are expected to help improve profit margin performance.
- Due to the low base last year, we think Sinopharm Group Co Ltd H (1099 HK) would achieve double-digit growth in 2023. We’re optimistic about its stock price performance accordingly.
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