OSAKA, Japan - Takeda Pharmaceutical Company Limited (NYSE:TAK) has surpassed its management guidance for revenue and core earnings per share (EPS) in fiscal year 2023, despite facing significant challenges including the impact of generic competition and strategic investments.
The company's stock saw a modest decrease of 1% following the earnings release, indicating a cautious market response to the financial results and future guidance.
The company reported a revenue of JPY 4,263.8 billion, marking a 5.9% increase at actual exchange rates (AER) and a 1.5% increase at constant exchange rate (CER). Core EPS stood at JPY 484, overcoming the hurdles of the fiscal year.
The company's performance in the Growth & Launch Product portfolio contributed notably to the financial results, even as core operating profit experienced a 13.3% decrease at CER, primarily due to the generic impact and investments in research and development (R&D) as well as data, digital, and technology initiatives. Takeda's president and CEO, Christophe Weber, expressed confidence in the company's resilience and its ability to navigate through short-term impacts to achieve sustainable revenue and profit growth starting from fiscal year 2025.
For fiscal year 2024, Takeda anticipates an approximately 10% decline in core operating profit and a mid-teens percentage decline in core EPS, with a forecasted EPS of JPY 431. Revenue is expected to remain flat or slightly decline at CER, with a forecast of JPY 4,350 billion.
Despite the anticipated flat or slight decline in revenue for FY2024, Takeda's CFO, Milano Furuta, remains optimistic about the company's long-term growth trajectory, highlighting the absence of significant loss of exclusivity impact from FY2025 until the early 2030s. The company's commitment to improving core operating profit margin by 100-250 basis points each year from FY2025 towards a low-to-mid 30s percentage target reflects this confidence.
Takeda's strategic focus continues to be on advancing its pipeline, including up to six new molecular entities (NMEs) with significant revenue potential in phase 3 development for FY2024. The company's efforts towards increasing female or non-binary representation among its senior-most leaders to 46% further demonstrate its commitment to diversity and inclusion.
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