First Quarter Consolidated Financial Results
for the Fiscal Year Ending March 31
31, 2014
1 Overview of consolidated results
1.
2. Main Product Sales Update
3. Development pipelines【Reference】
4. Segment
ginformation
5. Consolidated Financial

July 30, 2013

KYORIN Holdings, Inc.
These forecast performance figures are based on information currently available to theCompany and may include uncertain factors or risk that affect our future performance.
Accordingly, actual business results may materially differ from the forecasted figures due
to various factors in the future.

Outline of First Quarter Consolidated Financial Results
for the Fiscal Year Ending March 31, 2014
YoYchange(%)

Interim term
Sep / 2013
(forecast)

YoYchange(%)

Year ending
Mar / 2014
(forecast)

YoYchange(%)

First quarter
Jun / 2010

First quarter
Jun / 2011

First quarter
Jun / 2012

First quarter
Jun / 2013

Net sales

24,65524,80925,422

26,239＋3.2％

51,500 ＋7.4%

113,000 ＋5.6％

Operatingincome

2,216

4,100

4,080

4,465

＋9.4％

6,700 ＋6.9%

18,600 ＋3.6％

OrdinaryOdiincome

2,421

4,300

4,351

4,681

＋7.6％

7,000 ＋5.9%

19,200 ＋2.8％

Net income1,799

2,697

2,838

2,996

＋5.6％

4,600 ＋7.1%

12,700 ＋2.2％

Units:
millions of yen

First Quarter Consolidated Financial Results for the Fiscal Year Ending March 31, 2014

[Net Sales] Sales of ethical drug and generic drug increased year on year. And sales of KYORIN Pharmaceutical
Facilities which commenced operations on Oct 1st /2012 contributed to increase of net sales.
sales As a result,result consolidated
net sales increased 3.2% year on year, to ¥26.2bln.

[Income] While SG&A expenses increased, gross profit rose due to the decrease of cost of sales ratio. Consequently,
operating income rose 9.4% to ¥4.5bln, net income rose 5.6% to ¥3.0bln year on year.

Consolidated Financial Results for the Fiscal Year Ending March 31, 2014(forecast)
The results
Thlt forecasts
ft forf theth firstfi t half
h lf andd theth full
f ll year announced
d on MayM 9,9 2013 remain
i unchanged.
hd (P(Progresscompared with the forecast for the first half: net sales: 51.0%; operating income: 66.6%)
1

Highlights of Business Performance（ Units: ¥ billion）

Highlightg g ②Cost ofsales

Cost ofsales

25.4¾Net Sales increased ¥0.8bln year on year.

36.4%

37.7%

売上高Netsales

Highlight ①

cost ofSales ratio

cost ofSales ratio¾Cost of Sales remained almost the same level as
the previous year.

9.6

9.6
Net sales

R&D

26.2

2.5
SG&A
(excluding
R&D)

SG&A

11.8

9.3

¾Cost of Sales Ratio decreased 1.3 points.
・decrease of ethical drug’s cost of ratio・decreasedecrease of generic drug’sdrug s cost of ratio

R&D

2.4
SG&A
((excludingl diR&D)¾Gross Profit increased ¥0.9bln year on year.

SG&A

Highlight ③

12 2
12.2

◇SG&A expenses increased ¥0.4bln year on year.
・increase of general expenses
・decrease of R&D expenses (¥0.1bln)

Operatingincome◆Operating Income rose ¥0.4bln year on year.

9.8
OperatingincomeJun / 2012

Jun / 20132

Consolidated Financial Results
for the first Quarter ending
g March 31,, 2014
Year onYear（¥ billion）

Jun/2012

Jun/2013

change■Net Sales¥26.2bln(+ 0.8)◆Ethical drugs business¥25.8bln(+ 0.9)¥21.6bln(+ 1.0)¥0.6bln(－0.1)¥2.7bln((+ 0.1))

・Health insurance pharmacy market’s sales etc.
●Sales of Over-the-counter drugs¥0.9bln(－0.1)● Sales of new ethical drugs
Jun/2012⇒Jun/2013

Net Sales

25.4

26.2＋0.8

Ethical drugs
Business

24.9

25.8＋0.9◆Sales of new
ethical drugs●Overseas

21.3
20 6
20.6
0.7

22.2
21 6
21.6
0.6

＋0.9
＋1 0＋1.0－0.1◆Generic drugs

2.6

2.7＋0.1◆Over-thecounter drugs

1.00.9－0.1●JapanHealthcare(Skin care)
B iBusiness

0.5

0.4－0.1

OperatingIncome

4.1

4.5＋0.4

Ordinary
Income4.4

4.7＋0.3

Net Income

2.8

3.0＋0.2

・ Kipres・ Uritos
・ Mucodyne
y・ Pentasa

8.7 (－0.1)
8.8 ⇒
1.9 (0)1.9 ⇒
4.5 ((－0.1))
4.6 ⇒
4.7 (＋0.2)
4.5 ⇒・KYORIN Pharmaceutical Facilities sales●Sales of new ethical drugs in Overseas
・ Gatifloxacin 0.7 ⇒ 0.5 (－0.2)●Sales of Generic drugsg◆Healthcare (Skin care) Business¥0.4bln(‐0.1)(‐0.1)●Sales declined at Dr. Program■Operating Income¥4.5bln(+ 0.4)
◆Operating Income margin rose 1.0 percentage points to 17.0%●Cost of Sales Ratio : 36.4%

down 1.3 percentage points (37.7%⇒36.4%)

・decrease of ethical drug’s cost of ratio : increase of royalty (licensing out product)・decreasedoff generici ddrug’s’ costt off ratio
ti : iincrease off salesl ((strategic,supplementaryt t iltproducts)
d t )●R&D Ratio : 9.1%
down 0.6 percentage points (9.7%⇒9.1%)
・¥2.5bln⇒¥2.4bln●SG&A Ratio (excluding R&D expenses) : 37.4% up 0.9 percentage points・¥9.3bln⇒¥9.8bln
increase of general expenses (head office relocation expense , patent royalty etc.)■Net Income¥3.0bln(+ 0.2)
3

Main Product Sales Update（ Units: ¥ billion ）Interim term

P d t nameProductKipres（LT receptor antagonist）

Mucodyne（Mucoregulant）

Sales ofnew
ethicalddrugs(Japan)Full termFirst quarter（April 1 to June 30）
FY2012(results)

FY2013(results)

Y Y
YoYchange(%)

Progress toInterim term
forecast(%)

Progress toFull term
forecast(%)

FY2012(results)

FY2013(forecast)

FY2012(results)

FY2013(forecast)

16.3

17.7

39.6

40.8

8.8

8.7

－1.0%

48.9%

21.2%

8.3

8.0

19.1

18.7

4.6

4.5

－3.0%

56.0%

24.0%

9.0

9.3

17.6

18.6

4.5

4.7

＋2.4%

49.5%

25.0%

3.6

3.9

7.5

8.4

1.9

1.9

＋2.3%

49.1%

22.9%

15
1.5

13
1.3

30
3.0

27
2.7

08
0.8

08
0.8

1.5%
5%
－1

56 6%
56.6%

28 4%
28.4%

0.9

0.9

1.6

1.6

0.7

0.5

－19.5%

55.3%

31.9%

1.0

1.0

2.0

2.1

0.5

0.5

－4.9%44.3%

21.9%

Pentasa(Ulcerative colitis andCrohn’s diseasetreatment)

Uritos（Kyorin）(Overactive bladder)Ketas( o bronchial(Forb o c a asthma
ast a aanddcerebrovasculas disorders)

Sales ofnew ethicaldrugs (overseas)

Over-thecounter
drugs

Gatifloxacin((Bulk・Royalty)y y)

Milton(Disinfectant)Sales of Gatifloxacin included bulk sales to licensees and running royalties in accordance with sales at licensees.

4Actual and Forecast of Main Subsidiary Companies（ Units: ¥ billion ）KYORIN
pharmaceuticalFirst quarter
Jun/2012（results）

First quarter
Jun/2013（results）

FY 2012FY2013（results）（forecast）

Sales

23.0

23.3

95.9

100.0

Operating profit

4.1

4.1

17.1

17.7

Net profit

2.9

3.0

11.9

12.4

KYORIN Rimedio

First quarter
Jun/2012（results）

First quarter
Jun/2013（results）

FY 2012FY2013（results）（forecast）

Sales

2.7

2.9

10.4

11.5

Operating profit

00
0.002
0.2

04
0.4

04
0.4

Net profit

0.0

0.1

0.5

0.2

Dr. ProgramFirst quarter
Jun/2012（results）

First quarter
Jun/2013（results）

FY 2012FY2013（results）（forecast）

0.5

0.4

1.9

1.7

Operating profit

－0.1

0.1

－0.2

0.1

Net profit

－0.1

0.1

－0.3

0.1

Sales5Main R&D Activities -1 (July 30 , 2013 Release)※Changes from the previous announcement(May 9, 2013)

Ph III ~ Application submitted
StageJapan

Overseas

Compound/
Code

Therapyarea/Action

Oi iOrigin

F tFeatures

CCommentst

Application
submitted(9/2012)(US)SkyePharma: Application
submitted (3/2009)（Europe）
Mundipharma:Launched(9/2012)

KRP-108(Inhalant)

Antiasthmatic

SkyePharma PLC

An ICS/LABA combination product, which offers
better compliance and convenience to the patients・License agreement with
SkyePharma (4/2008)
・Domestic Ph II completed(4/2010)
・PhⅢcompleted(3/2012)

PhⅢ（9/2012）（Europe）
Almirall: Launched(9/2012)

KRP-AB1102（Inhaleddrug）

ChronicObstructive
Pulmonary
Disease(COPD)

Almirall- New Chemical Entity: Aclidinium Bromide
g Acting
g Muscarinic Agonistg((LAMA))- Long- Twice Daily administration-Onset of Action on the first dayGenuair®
1) Designed with a feedback system, which through a'colored control window' and an
audible click helps confirm that the patient has inhaledcorrectly2) Counter for remaining doses3) Safety features such as an anti-double-dosing
mechanism and an end-of-dose lock-out
system to prevent use of an empty inhaler

License agreement withAlmirall ((2/2011))

KIPRESBronchial
AsthmaMerck

For pediatric patient：Allergic Rhinitis

・Additional
Additional indication
・Co-development withMSD K.K.

(US)
ForestPharmaceuticals: Launched (12/2012)

PhⅢ(4/2013)（Chewable、Oral Granules）※Pentasa Suppository , a treatment for ulcerative colitis : launched June/2013※U it ,an overactive※Uritosti blbladderdd ddrug : llaunchedh d iin K
Korea JJuly/2013
l /2013 (Ch(Chong K
Kun D
Dang Ph
Pharmaceuticalti l CCorp.))6Main R&D Activities -2 (July 30 , 2013 Release)※Changes from the previous announcement(May 9, 2013)

POC Project (Pre-clinical ~ Ph II)
Stage

Compound/
Code

Therapy area/Action

OriginFeatures

Comments

Japan

Overseas

PhⅡ（5/2012）(Europe & US)
Almirall: Ph Ⅲ
(US)Forest
L b t iLaboratories: PhⅢ

KRP-AB1102F(Fixed dosecombination
inhaled drug)g)Chronic Obstructive
Pulmonary Disease(COPD)

Almirall

Combination of aclidinium bromide with the long acting
beta agonist formoterol :This combination is aimed at providing higher efficacy
than each component alone,as well as the improved
convenience
ioff having
h i ththe ttwo products
d t iin th
the sameeasy to use inhalation device.This is currently in phase
Ⅲ clinical development.

PhⅡ（8/2011）

PhⅢ
Merz

KRP-209

Tinnitus

Merz

KRP-209 (Neramexane) is expected to improve thepatients' annoyance and difficulties in their life caused
byy tinnitus,, mainlyy throughg its two pharmacologicalpg
properties: 1) NMDA antagonistic activity and 2)
Nicotinic acetylcholine antagonistic activity

License agreement withMerz (11/2009)
Merz:Ph I clinical trial ofJapanese patients in US
completed (3/2010)

PhⅡ（3/2013）

PhⅡ（POC)(12/2010)(Novartis)

KRP-203

Transplantation,
autoimmune
diseases anddiseases,andIBD

In-house

An immunosuppressant with a novel mechanism called
an S1P-agonist. It may have a better safety profile thanprevious ones as well as an excellent effect underconcomitant use with other types of immunomodulator.

License agreement with
Novartis (2/2006)
New license agreement
IBD (11/2010)

PhⅠ（8/2011）

KRP-AM1977X(Oral agent）

New quinolone
synthetic
antibacterial agent

In-house

PhⅠ（7/2012）

KRP-AM1977Y(Injection）

New quinolone
synthetic
antibacterial agent

In-house①Superior ability to combat drug-resistant grampositive bacteria (incl. MRSA)②Outstanding ADME (oral absorption, tissuemigration)③High degree of safety expected since safety
hurdles cleared prior to clinical trials

7

Segment information
for the first Quarter Ending March 31, 2014
Sales, Profit or Loss of each report segment(Units:¥ billion)

SalesYear on Year

ProfitYear on Year

26.2＋0.8

4.5＋0.4

25.8＋0.9

4.3＋0.2

22.2＋0.9●Overseas

21.6
0.6＋1.0－0.1◆◆Genericdrugs

27
2.7＋0 1＋0.1◆Over-the-counter drugs

0.9－0.1

Healthcare(Skincare) business04
0.4－0.1
0101
0.1＋0 2＋0.2

－－0.1

0.0

total
Ethical drugs business◆Sales of new ethical drugs●JapanAmount of adjustment(Note ) The Company is applying the Revised Accounting Standard for Disclosures about Segments of an Enterprise and RelatedInformation and the Guidance on the Accounting Standard for Disclosures about Segments of an Enterprise and Related Information.
As a result, the reported segments are the Ethical Drugs Business and the Consumer Healthcare Business.
8Consolidated Financial Results
for the first Quarter ending March 31, 2014
Interim termFirst quarter （April 1 to June 30）

Full term

Progressto interim
term forecast(%)

Progress tofull term
forecast
(%)

＋3.2%

51.0%

23.2%

＋880

＋3.5%

50.8%

23.2%

22,215

＋883

＋4.1%

51.1%

23.2%

20,586

21,582

＋995

＋4.8%

51.0%

23.1%

2,100745

633

－112

－15.1%

52.8%

30.2%

10,095

11,100

2,635

2,686

＋51

＋1.9%

52.7%

24.2%

2,200

4,379

4,600

953

899

－54－5.7%

40.9%

19.6%

920

700

1,869

1,700

501

438

－63－12.7%

62.6%

25.8%

Operatingincome

6,269

6,700

17,94818,600

4,080

4,465

＋385

＋9.4%

66.6%

24.0%

Ordinary
income

6,609
,

7,000
,

18,676

19,2004,351,4,681
,＋330

＋7.6％

66.9%

24.4%

Net income

4,295

4,600

12,422

12,700

2,838

2,996

＋158

＋5.6％

65.2%

23.6%

FY2012(results)

FY2013(forecast)

FY2012(results)FY2013(forecast)

FY2012(results)

FY2013(results)

ChangeYoYchange(%)

Sales

47,95451,500107,031

113,000

25,422

26,239＋816

Ethical drugs
business

47,03450,800105,162

111,300

24,92125,801

ethical drugs

39,68443,50090,686

95,60021,331●Japan38,66142,30088,286

93,500

1,023

1,200

2,400

◆Genericdrugs

5,056

5,100

◆O C drugs◆OTCand others

2,292

Consumerhealthcare
business(Units: ¥million)◆Sales of new●Overseas9