East Asia Soci Holdings, although sales increased in the first quarter, operating profit slightly decreased

East Asia Social Holdings’ consolidated performance in the first quarter shows an increase in sales, but due to widening profitability gaps among subsidiaries, operating profit slightly declined.

East Asia Social Holdings announced on the 24th that the provisional consolidated sales for the first quarter of 2026 are 351 billion won, with an operating profit of 19.1 billion won. Sales increased by 6.9% compared to the same period last year, but operating profit decreased by 6%. Analysts believe that within the holding company system, the performance trends of subsidiaries in pharmaceuticals, logistics, and bioproduction have diverged, leading to a slowdown in overall profitability.

Core subsidiary East Asia Pharmaceuticals continued its growth momentum thanks to expanded sales of Boguast and general medicines. First-quarter sales reached 1.88 trillion won, up 10.5%; operating profit was 206 billion won, up 22.1%. In contrast, the contract manufacturing organization (CMO) for biopharmaceuticals, STGEN Bio, had sales of only 18 billion won and an operating profit of just 20.6B won, down 5.7% and 89.1%, respectively. Logistics subsidiary Longma Logistics increased sales to 1.106 trillion won, up 9.6%, driven by securing new clients, but operating profit fell to 3.8 billion won, a decrease of 10.4%, due to rising fuel and logistics auxiliary material costs.

The performance of affiliated companies generally shows an improving trend. East Asia ST, the largest shareholder of East Asia Social Holdings, reported sales of 1.871 trillion won and an operating profit of 108 billion won on a standalone basis for the first quarter, representing increases of 10.7% and 53.7%. The professional medicines (ETC) division benefited from the sales of core products and the expansion of introduced drugs such as Jakubo, Diphereline, Tanamin, and Elidel Cream, reaching 1.44 trillion won, up 22.8%. The digital health division also generated 1.8 billion won in sales. However, overseas sales amounted to 200M won, a decrease of 17.5%. In R&D, the American affiliate Metavia completed phase 2a clinical trials for the metabolic disorder-related fatty liver disease (MASH) and type 2 diabetes candidate DA-1241, while the obesity treatment DA-1726 is in phase 1a trials. Ongoing domestic phase 1 clinical trials include treatments for dementia and immune-oncology agents.

Another affiliate, the contract development and manufacturing organization (CDMO) ST Pharm, saw a significant improvement in profitability. First-quarter sales reached 67 billion won, up 27.7%; operating profit was 11.5 billion won, a sharp increase of 1024.6%. The company explained that the expansion of high-margin products and the strong dollar effect contributed to the performance improvement. On a standalone basis, sales were 40.4 billion won, with an order backlog of about 340 billion won. In the CDMO sector, ongoing projects are expected to result in more than five new drug approvals or indication expansions within three years. In the new drug development division, the final key results of the global phase 2a clinical trial for the HIV treatment STP-0404 are scheduled to be announced in the third quarter.

These results indicate that while East Asia Social Group has maintained growth momentum in general and specialized medicines, it still faces cost burdens and industry condition fluctuations in bioproduction and logistics. This trend may lead the group’s overall performance to depend on whether future R&D outcomes can be converted into actual sales and whether the profitability of high-value-added manufacturing businesses can be stabilized.