Supplements Up, Pharma Down at Kyowa Hakko

December 11, 2006

1 Min Read
Supplements Up, Pharma Down at Kyowa Hakko

TOKYO—Kyowa Hakko Kogyo Co. Ltd. ( reported top and bottom line declines for the first six months of fiscal 2006, including decreased sales in its pharmaceutical division but increased revenues from its bio-chemicals division, which includes dietary supplements. Overall, consolidated net sales fell 2.4 percent to $1.47 billion, compared to the same period last year. Despite the sales woes, decreased personnel costs, and research and development spending helped increase operating income 18.4 percent to $123 million. However, various losses—including asset impairment charges and the sale of subsidiary shares— lowered earnings by 46.2 percent to $82 million.

One of the bright spots, the bio-chemicals division posted a 17.6-percent sales growth, but operating income fell 8.1 percent under price competition and higher raw material costs. Sales in overseas markets of amino acids used as dietary supplements showed some growth, although overall sales remained similar to the comparable period last year.

Kyowa’s food business also saw some minor growth, as sales inched up 0.3 percent to $178 million. In this sector, sales of natural seasonings, including fermented seasonings and customer-specified extract-type seasonings, were higher than in the first half of last fiscal year. And sales of umami seasonings also increased, leading to higher overall sales of seasonings.

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