Takeda(US:TAK)2023-10-27 06:02Financial Data and Key Metrics Changes - Revenue for the period was JPY2.1 trillion or $14.1 billion, with year-over-year growth at a constant exchange rate of 1.4% and actual exchange rate growth of 6.4% [8][76] - Core operating profit was JPY588.8 billion or $3.9 billion, reflecting a decline of 9.5% year-over-year at constant exchange rates [27][79] - Core EPS for the period was JPY261, down 14.4% compared to the prior year at constant exchange rates [80][81] Business Line Data and Key Metrics Changes - Growth and launch products represented 42% of total revenue and grew at 13% at constant exchange rates [8][45] - PDT Immunology delivered outstanding growth of 17%, with immunoglobulin growing by 19% and albumin by 11% [52] - Neuroscience grew by 3%, but faced challenges due to generic competition for VYVANSE [85] Market Data and Key Metrics Changes - ENTYVIO maintained its position as the number one treatment in the U.S. for inflammatory bowel disease (IBD), with strong volume growth in the EU at approximately 15% [14][51] - The U.S. IBD market is experiencing suppressed diagnosis and advanced therapy sessions compared to pre-COVID levels, indicating significant opportunities for growth [64][102] - The dengue vaccine QDENGA is seeing strong initial demand in endemic countries and travel markets, with recent approvals in multiple countries [34][38] Company Strategy and Development Direction - The company is focused on maximizing its portfolio, advancing its pipeline, and delivering on commitments, with a commitment to data, technology, and AI to enhance long-term competitiveness [7][25] - The strategy includes pursuing new assets to complement the existing pipeline, particularly in oncology [1] - The company aims to return to revenue, profit, and margin growth in the near term, driven by the expansion of growth and launch products [35][108] Management's Comments on Operating Environment and Future Outlook - Management acknowledged setbacks in the pipeline but emphasized confidence in returning to growth, potentially in 2024 or 2025 [97][108] - The company is committed to maintaining a progressive dividend policy while focusing on sustainable growth and competitive shareholder returns [67][108] - Management highlighted the importance of ongoing investments in R&D and technology to support high-potential programs [87] Other Important Information - The company faced significant non-core items impacting reported operating profit, including impairment losses related to EXKIVITY and ALOFISEL [49][88] - The FDA is evaluating applications for subcutaneous administration of ENTYVIO for Crohn's disease, with a decision expected in the first half of fiscal year 2024 [29][69] Q&A Session Summary Question: Margin expectations for Q3 - Management explained that the core operating profit margin is impacted by product mix and R&D phasing, with expectations aligned to their forecast [61][63] Question: Confidence in returning to growth - Management expressed confidence in returning to growth in 2024 or 2025, depending on the performance of VYVANSE and other factors [96][97] Question: Competitive landscape for ENTYVIO - Management acknowledged intense competition in the IBD market but emphasized ENTYVIO's leading market share and ongoing investments to maintain growth [102][103]