In the six months ended September 30, 2025, the prescription pharmaceuticals market grew, driven by robust sales of cancer drugs, specialty pharmaceuticals and vaccines, such as herpes zoster vaccine, despite a decrease in sales of COVID-19 related products. As a result, the Company’s consolidated operating results for the six months ended September 30, 2025 recorded 767,899 million yen for net sales, 7,258 million yen for operating profit, 8,329 million yen for ordinary profit, and 6,244 million yen for profit attributable to owners of parent. Regarding dividends, in line with our dividend policy of "stable growth aiming for a DOE (dividend on equity) of 2%," the annual dividend for this fiscal year has been set at 90 yen per share, an increase of 25 yen from the previous fiscal year. The interim dividend is 45 yen per share.

Under these circumstances, the Group has been promoting measures to improve profitability and productivity in its core pharmaceutical wholesaling business in accordance with the action plan announced November 2024 for the final year of the Medium-Term Management Plan 2023-2025 “Create the Next Generation.”

With regard to business transformation, our pharmaceutical MSs (Marketing Specialists) were focusing on developing the reagents market through the integration of pharmaceutical and reagent operations. Moreover, toward the shift to the Team System, which is targeted to start in April 2026, we worked on personnel deployment as well as the introduction of new delivery terminals and Delivery Management System with a view to separating commercial transactions and physical distribution.

As for specialty products, which are expected to grow in the future, we are continuing to expand the functions of our full-line services, which provide a range of services from product R&D to manufacturing and distribution, for pharmaceutical manufacturers in Japan and abroad. In July, the Group entered into a business alliance with TEIJIN REGENET CO., LTD. and ITOCHU Corporation to begin building a regenerative medical ecosystem in which the three companies will collaborate to provide one-stop support services necessary for the launch of regenerative medical products.

In the customer support business, we actively worked to offer cloud-based picking audit system EveryPick provided by PHARUMO, Inc., with which we formed a capital and business alliance in June. Additionally, we are collaborating on the new pharmacy DX platform service N-Bridge and the prescription information transmission terminal NB Station, which are being developed by PHARUMO, Inc. and the Japan Pharmaceutical Association.

Furthermore, as part of its growth strategy, the Company established a corporate venture capital (CVC) fund TOHO Ventures, with Global Brain Corporation, an independent venture capital firm, as a general partner, with the aim of accelerating open innovation and creating new businesses that will lead the next generation, in addition to strengthening existing businesses. The fund plans to invest mainly in advanced overseas startups in the fields of drug discovery and biotechnology and medical DX. Going forward, we will actively leverage the Group’s existing assets and operate the funds as a co-creation type CVC to realize the commercialization and social implementation of investee companies’ businesses.

We established in August 2024 the Governance Enhancement Special Committee as an advisory body to the Board of Directors, consisting of members independent from the Company with expertise in law, finance, corporate management, and other relevant fields. The committee held discussions until October 2025 on the Group's overall governance issues, including compliance and risk management, and improvement measures from an objective and professional perspective. At its meeting on October 9, 2025, the Company’s Board of Directors received from the Governance Enhancement Special Committee the Final Report of the Governance Enhancement Special Committee: Report on Strengthening the Governance Systems and Improving Operations. On October 31, the Company publicly announced the full text of the report and a summary of the recommendations laid out in the report, as well as the Company’s basic policy and specific action policies for responding to the recommendations. We will strive to further strengthen our governance by steadily implementing initiatives in accordance with these policies.

 

We look forward to your continued support.