Celltrion (068270.KS) posted record earnings in the second quarter, and analysts expect the growth momentum to continue in the second half of the year. Improvements in the US business environment, including the US Food and Drug Administration's (FDA) streamlined biosimilar development guidelines and the exclusion of biosimilar drugs from tariffs, are expected to serve as additional earnings drivers.
"Strong second-quarter results came from maintaining a high-margin product mix and improving the cost ratio," Heungkuk Securities said in a report Tuesday. "The improved cost ratio from depleting existing inventory also drove earnings above consensus estimates, while development cost efficiency and revenue recognition from the operation of the Branchburg plant in the US worked favorably."
Celltrion's second-quarter revenue reached 1.3 trillion won, with operating profit of 430 billion won, up 35.2% and 77.3% year-on-year, respectively. The operating profit margin stood at 33%. The results reflect an expanded share of high-margin new biosimilar products, including Zymfentra, a subcutaneous (SC) formulation of infliximab, and Steqeyma, a treatment for autoimmune diseases. New products such as Zymfentra and Steqeyma now account for more than 60% of total revenue.
In addition, the Branchburg plant in New Jersey began recording contract manufacturing (CMO) revenue in earnest from the second quarter. The plant is expected to contribute 200 billion won to the top line by year-end. Heungkuk Securities forecast Celltrion's consolidated revenue and operating profit for 2026 at 5.121 trillion won and 1.767 trillion won, respectively, up 18% and 23% from the previous year.
Heungkuk Securities maintained its "buy" rating on Celltrion with a target price of 270,000 won, explaining that the direction of profit growth is clear regardless of market volatility. The brokerage also projected that expectations for second-half earnings will grow, driven by the FDA's streamlined biosimilar development guidelines and the exclusion of biosimilar drugs from tariffs.
