[Click eStock] Celltrion's Earnings 'Cooling Down'... Will Spring Come?

[Asia Economy Reporter Junho Hwang] Hana Financial Investment lowered the target price of Celltrion to 210,000 KRW on the 13th, stating that the company posted results below market expectations due to increased expenses in the first quarter of this year.

Celltrion achieved sales of 550.6 billion KRW in the first quarter of this year, representing a 20.5% increase compared to the same period last year. However, operating profit recorded 142.3 billion KRW, a 34.5% decrease over the same period. This is below the consensus figures of sales 526.5 billion KRW and operating profit of 197.9 billion KRW.

Sales were driven by Remsima IV and Celltrion USA's diagnostic kits. However, the expansion of the relatively low-profit Remsima IV and diagnostic kits, along with the write-down of inventory related to Regkirona and research and development costs for COVID-19 inhalation formulations, caused the operating profit margin to decline to 25.8%, compared to 45.4% in the same period last year.

Hana Financial Investment forecasts that Celltrion will achieve sales of 2.2095 trillion KRW (a 15.6% increase year-on-year) and operating profit of 721 billion KRW (a 4.2% decrease year-on-year) this year.

Researcher Jaekyung Park of Hana Financial Investment said, "Celltrion's current price-to-earnings ratio (PER) for the next 12 months is around 31.2 times, approaching the low point of 2019," adding, "Further declines are expected to be limited."

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