Kobayashi Pharmaceutical Co., Ltd.TSE: 4967

Kobayashi Pharmaceutical: Financial Overview for First Quarter of Fiscal 2026(Fiscal Year Ending December 31, 2026)

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DISCLAIMER:

This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between this translated document and the Japanese original, the Japanese original shall prevail.

Financial Results Briefing for First Quarter of Fiscal Year Ending December 31, 202GKobayashi Pharmaceutical Co., Ltd.

Atsushi Uenohara, General Manager, Public Relations & IR Department May 8, 202G

Introduction

Regarding red yeast rice-related products

2/13

We would like to reiterate our deepest apologies to our customers, business partners, and all other parties associated with our company for the concerns and inconvenience caused by the incident of our red yeast rice-related products in 2024.We continue to give priority above all to apologizing to and compensating our customers who have suffered health damage and our suppliers who have suffered losses, and we will do so sincerely and appropriately.

Progress of Compensation for Health Damage (for hospitalization and hospital visits)

3/13

(as of April 30, 202G)

(Approximate figures)

Those who have contacted the compensation desk

1,350

Those who have submitted compensation application documents

t00

Number of people whose compensation application documents are currently being reviewed

30

Number of people whose compensation application documents have been checked

870

Those who have been found to be eligible for compensation

510

Those who are currently undergoing treatment or those who are currently negotiating compensation details

170

Number of people whose compensation has been paid

340

* Regarding death-related inquiries, our survey has identified no cases where death was clearly caused by the consumption of the product at this point.

（Unit: billion yen）

Q1

Results

YoY change (Percentage)

Consolidated

33.G

+1.1

(+3.2%)

Domestic Business

23.2

+0.5

(+2.3%)

International Business

10.2

+0.5

(+5.1%)

Net Sales

（Unit: billion yen）

Q1

Results

YoY change (Percentage)

Consolidated

1.3

-1.2 (-4G.7%)

Domestic Business

1.G

-0.t (-33.7%)

International business

-0.3

-0.3

（-）

Operating income

© Kobayashi Pharmaceutical Co., Ltd. All Rights Reserved.

【Summary of Sales】

Both Domestic and International Businesses saw increased sales, landing roughly as planned.

【Highlights of Domestic Business】

‧Seasonal products performed poorly, such as a decrease in sales of body warmers due to a warm winter and struggles with cold-related products that had high hurdles in the previous year. In addition, the termination of our own direct marketing platform was a factor in the sales decline

‧On the other hand, the effect of the resumption of advertising from July 2025 strongly drove overall sales, offsetting these negative impacts and ensuring sales growth for the domestic business as a whole.

【Highlights of International Business】

‧U.S.: Sales decreased due to the impact of temporary production delays at contract manufacturers.

‧Southeast Asia: Sales slightly decreased overall, as the rebound increase in the Philippines, which was weak in the previous year due to shifting order timing, was offset by the decrease in sales in Thailand, which struggled due to a lull in infectious disease outbreaks.

‧Mainland China: On the other hand, Mainland China, which hit bottom at the end of the previous year, entered a recovery trend and drove overall sales, securing an increase in total sales for the Business.

【Summary of Operating Income】

‧Domestic profit decreased due to a significant increase in advertising expenses in reaction to the suspension of advertising in Q1 of the previous year (resumed in July 2025).

‧Although consolidated operating income also decreased, it exceeded the plan by approximately 0.5 billion yen.

Although an extraordinary loss on red yeast rice-related products (approx. 0.3 billion yen) was recorded, it was offset by gains on the sale of investment securities, etc.

（Unit: billion yen）

Q1 (Jan. to Mar.)

Amount

Year-on-year change

Margin

FY25

FY2G

Net sales

32.G

33.G

+3.2%

ー

Gross profit

1G.G

17.4

+4.5%

51.8%

Operating income

2.5

1.3

-4G.7%

4.0%

Ordinary income

2.4

1.G

-30.4%

5.0%

Net income

1.G

1.0

-3G.2%

3.1%

EBITDA※

4.7

3.G

-23.G%

10.7%

※EBITDA = Operating income + Depreciation + Amortization of goodwill

Operating income decreased due to the impact of the full-scale resumption of domestic advertising.

Factors for changes in operating income

Unit: billion yen

Sales price

hike +0.3

Manufacturing personnel costs -0.2

Depreciation -0.1

Decrease in disposal +0.2

(+ indicates increase and - indicates decrease)

+0.t

-0.1 -0.4 +0.4

-2.0

2.5

-0.2

±0 +0.2

Impact of production costs

+0.8

Impact of SGA expenses

-1.t

1.3

FY25 Q1

Change in

Raw

Fixed

Other

Advertising

Personnel Depreciation Other SGA

FY2G Q1

operating income

gross profit due to sales

material prices

costs

production costs

expenses

costs

and amortization

expenses

operating income

The results of the Direct Marketing Business, which terminated sales on its own site at the end of the previous fiscal year, have been integrated into Healthcare from this fiscal year. Domestic net sales excluding former direct marketing products increased by 5.5%, but operating income decreased due to the resumption of advertising, etc.

※Figures in parentheses exclude former direct marketing products.

（Unit: billion yen）

Q1 (Jan. to Mar.)

Amount

Year-on-year change

FY25

FY2G

Net sales

Healthcare products

13.5

(12.7)

13.7

(13.G)

+1.8%

(+7.3％)

Household products

8.G

8.t

+4.2%

Body warmers

0.G

0.5

-13.5%

Total

22.7

(22.0)

23.2

(23.2)

+2.3%

(+5.5%)

Total operating income

2.5

1.G

-33.7%

Margin

11.2%

7.2%

ー

In anticipation of restrictions on data acquisition due to the revision of the tax exemption system, the calculation method has been changed to a "sell-in (shipment) basis" from this fiscal year. There is no significant difference in the trend between the two calculation methods, and the recent Q1 results are on par with the previous year.

（Unit: billion yen）

Calculation method

Characteristics of calculation model

Full year

Q1

2025

2025

202G

Previous

Sell-out basis

Expanded estimation by uniformly applying the tax-free POS results (tax-free ratio) of some mass retailers to other mass retailers

‧Future data acquisition will become difficult due to the system revision.

‧Since the tax-free ratio of mass retailers with relatively high inbound tourism demand was uniformly applied to other mass retailers, the figures might have been higher than the actual situation.

11.5

2.5

2.7

New

Sell-in basis

Designating stores that show characteristics of purchases by overseas tourists as "inbound stores" and aggregating shipment results

‧Based on our own data, performance management is possible without being affected by changes in external systems.

※In reality, there is a certain deviation from the actual situation, as overseas tourists may make purchases even at non-inbound stores.

4.8

1.1

1.2

Sell-out status of products for which TV advertising resumed in the healthcare-related product group, excluding seasonal items※

Following the resumption of advertising in July 2025, the recovery trend has continued, particularly in the healthcare-related product group.

(YoY change)

※Monthly average of SRI

＜Examples of successful products＞

80%

t0%

110%

120%

100%

Sell-out trend after the resumption of

advertising

【EYEBON】 【INOCHINOHAHA 】

【KESHIMIN】 【BREATH CARE】

Apr. May June July Aug. Sep. Oct. Nov. Dec.

FY 2025

Jan. Feb. Mar.

FY 202G

Increased sales and decreased profit. The decrease in sales in the U.S. and Southeast Asia was covered by Mainland China and other areas. Effect of foreign currency translation (Net sales +0.5 billion yen, Operating income +0.04 billion yen)

（Unit: billion yen）

Q1 (Jan. to Mar.)

Amount

Year-on-year change

FY25

FY2G

Including effect of

foreign currency translation

Excluding effect of

foreign currency translation

Net sales

U.S.

4.8

4.4

-t.0%

-11.4%

Mainland China

1.3

1.t

+40.2%

+30.t%

Hong Kong region

0.5

0.7

+18.1%

+15.3%

Southeast Asia

2.0

2.0

-1.3%

-t.1%

Other

0.8

1.1

+33.8%

+21.8%

Total International Business

t.7

10.2

+5.1%

-0.3%

Total operating income

0

-0.3

ー

ー

Margin

ー

ー

ー

ー

U.S.

Mainland China

Southeast Asia

FY23

2.0

FY2G

FY25

FY24

FY23

2.0

2.7

2.2

-0.02 billion yen

year-on-year in Q1

【Major topics】

‧The Philippines performed strongly due to a rebound from the timing differences in shipments in the previous year.

‧Although other countries covered the impact of the sluggish fiu season in Thailand, sales slightly decreased in the region overall.

Net sales（Q1）

（billion yen）

1.t

FY2G

1.3

FY25

2.1

FY24

2.1

FY23

+0.G billion yen

year-on-year in Q1

【Major topics】

‧Shipments of Cooling gel sheets and ANMERUTSU recovered smoothly as the impact of inventory adjustments and distributor changes in the previous year has run its course.

Net sales（Q1）

（billion yen）

FY2G

FY25

FY24

3.8

2.G

4.4

4.8

Net sales（Q1）

（billion yen）

-0.4 billion yen

year-on-year in Q1

【Major topics】

‧Decrease in sales of healthcare products due to temporary production delays at contract manufacturers.

The financial impact is estimated based on confirmed events at this point (excluding uncertain future risks). We will continue to closely monitor the situation and take countermeasures to minimize the impact.

Impact on supply chain

"Procurement delays and restrictions" and "price hikes (requests for price increases)" have occurred mainly for the following raw materials:

‧Packaging materials (bottles, films, etc.)

‧Petrochemical raw materials (alcohols, surfactants, etc.)

※The actual impact is limited to some products because we procure from a variety of suppliers.

Impact on business

‧Loss of sales opportunities due to shipment control of standard products (to suppress stockouts) and cancellation of promotional products.

‧Cost increases due to requests for raw material price increases.

Financial impact (Variance from initial plan)

‧Net sales: -0.5 billion yen (mainly in Q2)

‧Operating income: -1.5 billion yen (mainly in the second half)

※Only refiects confirmed events at this point (excluding uncertain future risks).

※Assumes no profit improvement effects from various countermeasures.

Countermeasures

  • Promotion of alternative procurement: Diversification of procurement routes by switching to alternative raw materials and developing new suppliers.

  • Resource allocation: Priority allocation of raw materials to major standard products and focus brands to defend store shelf share.

  • Expense control: Minimizing the impact through adjustment of advertising and sales promotion expenses according to supply status and overall expense control.

  • Optimization of product prices: Flexible implementation of product price increases after continuing self-help efforts to the maximum extent.

（Unit: billion yen）

FY 2025 results

FY 202G forecast

Amount

Amount

Year on year change

Margin

Net sales

1G5.7

173.0

＋4.4%

ー

Operating income

14.t

12.5

-1G.2%

7.2%

Ordinary income

1G.t

13.0

-23.5%

7.5%

Net income

3.G

10.0

＋173.5%

5.8%

EBITDA

23.G

22.0

-G.t%

12.7%

EPS

46.16 yen

134.52 yen

＋173.5%

ー

ROE

1.7%

4.8%

ー

ー

Dividend

104 yen

(Interim 44yen, Year-endG0yen)

10G yen

(Interim 45yen, Year-endG1yen)

ー

ー

Domestic business

118.0

123.0

＋4.2%

ー

International business

4G.t

4t.4

＋5.1%

ー

Forecast of Consolidated Results for the Year Ending December 31, 202G There are no revisions to the full-year outlook.

13/13

Of the Company’s current business performance, plans, and strategies included in this material, items that are not historical facts are outlooks on future performance, which are based on the judgment of the Company’s management according to currently available information. Therefore, please note that actual performance may differ significantly from the future outlook described in this material due to changes in various factors.
Reference

（Unit: billion yen）

FY25 Q1

（Jan. to Mar.）

FY2G Q1

（Jan. to Mar.）

Amount

Amount

Year-on-year change

Net sales

32.G

33.G

+3.2%

Gross profit

1G.G

17.4

+4.5%

Margin

51.2%

51.8%

ー

Operating income

2.5

1.3

-4G.7%

Margin

7.8%

4.0%

ー

Ordinary income

2.4

1.G

-30.4%

Margin

7.4%

5.0%

ー

Net income

1.G

1.0

-3G.2％

Margin

5.0%

3.1％

ー

（Unit: billion yen）

FY 25 Q1

(Jan. to Mar.)

FY2G Q1

(Jan. to Mar.)

Amount

Amount

Year-on-year change

Advertising expenses

1.0

3.0

+18G.2%

Margin

3.2%

8.t%

ー

Sales promotion expenses

0.7

0.7

+1.5%

Margin

2.2%

2.2%

ー

（Unit: billion yen）

FY25

End of Mar.

FY25

End of Jun.

FY25

End of Sep.

FY25

End of Dec.

FY2G

End of Mar.

Current assets

132.3

135.t

132.0

148.8

127.5

Cash and deposits

52.4

5G.2

45.2

G2.3

5G.7

Notes and accounts receivable-trade

32.G

32.t

40.3

52.1

33.4

Short-term investment

securities

14.8

13.3

12.G

8.3

8.3

Inventories

27.3

30.G

30.G

22.7

2G.4

Non-current assets

11t.4

124.7

12t.4

12G.5

127.2

Property, plant and

equipment

G7.G

73.4

74.G

G7.3

G8.3

Intangible assets

1t.0

17.8

17.G

17.4

1G.t

Investments and other assets

32.7

33.4

37.0

41.7

42.0

Total assets

251.7

2G0.7

2G1.4

275.3

254.8

（Unit: billion yen）

FY25

End of Mar.

FY25

End of Jun.

FY25

End of Sep.

FY25

End of Dec.

FY2G

End of Mar.

Current liabilities

3t.G

4G.5

42.3

G0.1

41.t

Notes and accounts payable-trade

t.0

t.1

8.5

8.4

7.G

Accounts payable-other

t.G

15.7

13.t

30.t

1G.1

Non-current liabilities

5.0

5.t

7.0

4.1

4.0

Total net assets

207.0

208.2

212

211

208.t

Capital surplus

0.5

0.5

0.5

0.5

0.5

Retained earnings

205.4

207

207.3

204.2

200.8

Treasury stock

-24.7

-24.7

-24.7

-24.7

-24.7

Total liabilities and net assets

251.7

2G0.7

2G1.4

275.3

254.8

yen

FY25

(Jan. to Mar.)

FY2G

(Jan. to Mar.)

FY2G forecast (Jan. to Dec.)

US dollar

152.G

15G.8

148.0

Chinese yuan

20.t

23.0

21.0

（Unit: billion yen）

FY25 Q1

(Jan. to Mar.)

FY2G Q1

(Jan. to Mar.)

Amount

Amount

Year-on-year

change

Net sales

22.7

23.2

+2.3%

Gross profit

11.1

11.t

+7.1%

Margin

4t.1%

51.4%

ー

Operating income

2.5

1.G

-33.7%

Margin

11.2%

7.2%

ー

Advertising expenses

0.2

1.t

+81G.3%

Margin

0.t%

8.2%

ー

Sales promotion expenses

0.2

0.2

-2.5%

Margin

1.2%

1.2%

ー

（Unit: billion yen）

FY25 Q1

(Jan. to Mar.)

FY2G Q1

(Jan. to Mar.)

Amount

Amount

Year-on-year change

Healthcare products

13.5

13.7

+1.8%

Pharmaceuticals

G.8

7.2

+5.t%

Food

1.1

1.2

+11.2%

Oral care products

3.4

3.7

+10.4%

Skin care products

1.3

1.3

+2.t%

Discontinued direct marketing products

0.7

0.0G

-t2.0%

Household products

8.G

8.t

+4.2%

Sanitary products

2.2

2.1

-5.0%

Deodorizing air fresheners

5.4

5.8

+7.3%

Household articles

0.8

0.t

+t.4%

Body warmers

0.G

0.5

-13.5%

（Unit: billion yen）

FY 25 Q1

(Jan. to Mar.)

FY2G Q1

(Jan. to Mar.)

Amount

Amount

Year-on-year

change

Net sales

t.7

10.2

+5.1%

Gross profit

5.4

5.3

-0.5%

Margin

55.t%

52.t%

ー

Operating income

0

-0.3

ー

Margin

ー

ー

ー

Advertising expenses

0.8

1.0

+31.G%

Margin

8.5%

10.7%

ー

Sales promotion expenses

0.4

0.4

+3.3%

Margin

4.G%

4.5%

ー

（Unit: billion yen）

FY25 Q1

(Jan. to Mar.)

FY2G Q1

(Jan. to Mar.)

Amount

Amount

Year-on-year change

Year-on-year change

(Excluding effect of foreign currency translation)

U.S.

4.83

4.40

-t.0%

-11.4%

China

1.tt

2.GG

+33.G%

+2G.2%

Mainland China

1.3t

1.t5

+40.2%

+30.t%

Hong Kong region

0.5t

0.70

+18.1%

+15.3%

Southeast Asia

2.03

2.01

-1.3%

-t.1%

Singapore

0.11

0.17

+55.4%

+43.0%

Malaysia

0.58

0.5G

-4.3%

-17.0%

Thailand

0.48

0.3G

-25.8%

-32.8%

Indonesia

0.3t

0.3G

-8.2%

-7.2%

Philippines

0.24

0.3G

+51.3%

+50.1%

Taiwan region

0.21

0.18

-11.7%

-17.4%

Other

0.83

1.12

+33.8%

+21.8%

U.K.

0.58

0.Gt

+18.3%

+7.4%

Australia

0.22

0.30

+3t.4%

+22.4%

（Unit: billion yen）

FY25 Q1

（Jan. to Mar.）

FY2G Q1

（Jan. to Mar.）

Amount

Amount

Year-on-year change

Year-on-year change

(Excluding effect of foreign currency translation)

U.S.

4.83

4.40

-t.0%

-11.4%

Body warmers

2.13

2.10

-1.G%

-4.2%

Pharmaceuticals

1.5t

1.50

-G.0%

-8.G%

Other

1.10

0.80

-27.5%

-2t.5%

Mainland China

1.3t

1.t5

+40.2%

+30.t%

Body warmers

0.35

0.5G

+5t.G%

+47.5%

Cooling gel sheets

0.4t

0.G3

+27.7%

+18.1%

Other

0.54

0.7G

+3t.1%

+28.G%

Southeast Asia

2.03

2.01

-1.3%

-7.7%

Pharmaceuticals

0.5G

0.43

-21.G%

-30.0%

Cooling gel sheets

1.18

1.23

+4.0%

-0.G%

Other

0.2t

0.34

+1G.t%

+G.0%

© Kobayashi Pharmaceutical Co., Ltd. All Rights Reserved.