RIBOMIC (4591) FY2026 Q3 Earnings Report

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Executive Summary

Amid continued operating losses as a research and development-focused biotechnology venture, the loss margin was largely unchanged year on year. The operating loss was ¥0.79B (¥0.78B in the same period last year, deterioration rate of 1.7%), the ordinary loss was ¥0.76B (¥0.74B last year, deterioration rate of 3.1%), and the net loss was ¥0.76B (¥0.74B last year, deterioration rate of 3.1%). Revenue remained effectively negligible, indicating that the Company remains in the development phase before commercialization. Loss per share narrowed to ¥15.86 from ¥18.88 in the previous year; however, this does not reflect a reduction in losses, but rather a dilution effect resulting from an increase in the weighted-average number of shares outstanding during the period due to capital raising. Progress against the full-year operating loss forecast of ¥1.32B was approximately 59.8%, below the standard progress rate of 75%, indicating that loss accumulation is currently below plan.

Factors Driving Performance Changes

【Revenue】Revenue for the current period was effectively zero and declined from ¥0.002B in the same period last year. The business remains in the research and development phase and has not yet achieved recurring revenue recognition from its products or services.

【Profit and Loss】SG&A expenses were ¥0.30B, an increase of 4.9% year on year, growing at a faster pace than the 1.7% deterioration in the operating loss. Non-operating income of ¥0.04B (including ¥0.018B in subsidy income) partially mitigated the loss; however, this declined from the previous year's ¥0.035B in subsidies, indicating that non-operating support has weakened. The ordinary loss and net loss remained at approximately the same level, and the impact of income taxes and other taxes was immaterial. In conclusion, fixed costs continue to increase ahead of the establishment of a revenue base, and the pattern of declining revenue and earnings (in substance, expanding losses amid negligible revenue) persists.

Key Financial Indicators

【Profitability】Annualized ROE was approximately negative 32.5%, while annualized ROA was approximately negative 31.0%; both reflect weak returns on equity and assets due to losses. With operating losses continuing, profitability indicators have not entered an improvement phase.【Cash Quality】The Company held ¥2.10B in cash and deposits and ¥1.10B in short-term investment securities, with the combined amount accounting for approximately 94.6% of total assets, representing a high ratio of cash-like assets. Non-operating income includes non-recurring items such as subsidy income, and operating loss should be used as the basis for evaluating recurring earnings power.【Investment Efficiency】Invested capital continues not to generate sufficient returns at present, making the conversion of development investment into business value a key challenge.【Financial Soundness】The equity ratio was extremely high at 95.2%, while the current ratio exceeded 2,000%, indicating ample liquidity. Liabilities were extremely small relative to total assets, and financial leverage was effectively close to zero.

Cash Flow Analysis

Cash and deposits increased by ¥0.26B from ¥1.84B in the same period last year to ¥2.10B, while short-term investment securities decreased by ¥0.10B from ¥1.20B to ¥1.10B, resulting in a ¥0.16B increase in their combined balance from ¥3.04B to ¥3.20B. Although the Company recorded a net loss of ¥0.76B during the period, liquid assets expanded. As both stated capital and capital surplus increased by ¥0.47B, it appears that cash inflows from capital raising exceeded cash outflows attributable to the loss. Using the full-year operating loss forecast of ¥1.32B as an approximate measure of annual cash consumption, the ¥3.20B held in cash, deposits, and short-term investment securities corresponds to approximately 2.4 years of coverage, and no major concerns are evident regarding near-term funding. However, it should be noted that the actual pace of cash consumption may fluctuate depending on the timing of development expenditure payments and the recognition of subsidy and collaboration income.

Earnings Quality

The current period's results were centered on an operating loss, while subsidy income included in non-operating income declined to ¥0.018B from ¥0.035B in the previous year, reducing the non-recurring support effect. The burden of income taxes and other taxes was extremely small, and the ordinary loss and net loss remained at approximately the same level, indicating limited distortion of earnings due to tax factors. Because the business structure has generated effectively no revenue, from an accrual perspective (adjustments based on the accrual basis of accounting), the recurring revenue and profit recognition that would serve as the basis for discussing earnings quality has not yet been established. Accordingly, current earnings are strongly influenced by the progress of research and development investment and the receipt of external funding such as subsidies, and evaluation of recurring earnings power must await the commencement of revenue recognition.

Earnings Forecasts and Guidance

The full-year forecasts are an operating loss of ¥1.32B, an ordinary loss of ¥1.27B, and a net loss of ¥1.28B. The Q3 cumulative progress rates were 59.8% for the operating loss and 59.7% for the net loss, both approximately 15 percentage points below the standard progress line of 75%. This indicates that losses are currently progressing below the Company's plan; however, losses may be concentrated in Q4 depending on the timing of research and development expenses and the recognition of subsidy and collaboration income. Full-year results will therefore depend on future expenditure execution.

Shareholder Returns

Both the Q2 dividend and the full-year forecast dividend are ¥0 per share, and the Company continues to pay no dividends. As the Company is recording a net loss, the payout ratio is effectively 0%. No share repurchases have been confirmed, and the total return ratio likewise remains effectively 0%. This is consistent with a capital policy that prioritizes the allocation of available liquidity to research and development activities and business continuity.

Risk Factors

1. Uncertainty regarding the timing of commercialization: With revenue remaining effectively negligible and the operating loss reaching ¥0.79B, any delay in monetization through collaboration, licensing, or other revenue sources could extend the period of continued losses.

2. Ongoing cash consumption and dependence on capital raising: Based on the full-year operating loss forecast of ¥1.32B, the ¥3.20B held in cash, deposits, and short-term investment securities corresponds to approximately 2.4 years of coverage. Stated capital and capital surplus each increased by ¥0.47B from the same period last year. If the structure of relying on capital raising to secure funding continues, it could lead to future share dilution.

3. Fluctuations in external support income: Subsidy income declined from ¥0.035B in the same period last year to ¥0.018B in the current period, and fluctuations in external funding are contributing to volatility in ordinary income.

Industry Benchmark (For Reference; Compiled by the Company)

Industry Benchmark (pharma)

Growth and Capital Efficiency

The revenue growth rate was substantially below the industry median, highlighting the Company's position in the development stage, with its revenue base yet to be established, even within the industry.

※Source: Compiled by the Company

Key Takeaways from the Financial Results

1. Thick liquidity and low liabilities limit short-term financial stress. Cash, deposits, and short-term investment securities of ¥3.20B account for approximately 94.6% of total assets, while the equity ratio is also high at 95.2%.

2. The Q3 cumulative progress rate against the full-year loss forecast is approximately 60%, proceeding below plan; however, profitability indicators (annualized ROE of approximately negative 32.5% and annualized ROA of approximately negative 31.0%) remain substantially negative, and improvement in capital efficiency depends on the commercialization of research and development results.

3. While net assets continue to increase through capital raising, accumulated losses in retained earnings are expanding, making the absence of capital accumulation through internally generated profits a structural feature.

Theoretical Share Price (Reference Value)

Sensitivity: ¥8–¥8 at ±1% in the cost of equity, and ¥8–¥9 at ±0.1 in ω.

Notes:

• As forecast ROE is below the cost of equity, the theoretical value is below book value per share.
• Net assets as of the quarter-end are used (there is a timing difference from the full-year forecast).
• As net assets include non-controlling interests, the theoretical value may be calculated somewhat higher.

(Calculation model: Residual income model (Ohlson-type, explicit 5-year fade) / Interest rate reference month: 2026-07 / Mechanically calculated solely from publicly disclosed data; this is not a forecast of the market share price or a recommendation of any specific investment action, and does not forecast or guarantee the future share price)

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This report is an earnings analysis document automatically generated by AI based on XBRL earnings release data. It does not recommend investment in any specific security. The industry benchmark is reference information compiled by the Company based on publicly disclosed earnings data. Investment decisions should be made at your own responsibility, after consulting a professional as necessary.

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