Hello, everyone. Thank you for joining Japan Lifeline's first half or H1 financial results briefing for the period ended September 30, 2025. I'm Takeyoshi Egawa, Director and CFO. Before we get into the specifics of our H1 performance, I must start by thanking our incredible team. The strong results you will see today are fueled by their passion, expertise, and consistent dedication. Our people are, and always will be, our greatest asset. Now, let's turn to the H1 financials. Please turn to page 4. Our H1 results achieved record-high net sales, operating profit, and net profit for the H1 period. Net sales reached JPY 29.28 billion , up 4.6% year-over-year. Operating profit was JPY 6.62 billion , up 5.7%. Net profit was JPY 4.77 billion , up 7.7%. We achieved both sales growth and profit growth. We have organized the contributing factors into external and internal components.
As for external factors, we cite three key items. The first, which is a positive factor, is the increase in atrial fibrillation or AF cases volume. AF cases volumes increased approximately 10% year-over-year. This increase was in line with our initial guidance and contributed to the growth of proprietary EP ablation product sales. The second, which is a negative factor, is the impact of pulsed field ablation or PFA. PFA is a new treatment method being promoted by competitors. The pace of PFA adoption was faster than anticipated, mainly affecting the sales of esophageal temperature monitoring catheters and some EP catheters. The third, which is also a negative factor, is the impact of reimbursement price revisions. This relates to the revision implemented in June 2024. In the H1 comparison, this caused a decline in selling prices, resulting in a negative impact for two months. Let's turn to the internal factors.
We cite three items. The first is that our core product group performance, defined as for competitive products, performed well overall. The second one is that our new therapeutic areas' expansion, consisting of neurovascular and gastrointestinal segments, continued their strong growth trend, increasing 38.4% year-over-year. The third is bad debt collection. This was a positive, one-time factor, as we were able to collect part of a bad debt receivable from a particular business partner, which had a temporary positive impact on profit. Please turn to page 5. We want to add a supplementary comment on the reimbursement price comparison. The frequency of medical device price revisions is once every two years. Starting in 2024, the revision month was changed from April to June, and this change is expected to continue.
In this specific H1 comparison, the price difference between the old or higher price and the new or current price occurred for two months, namely April and May, relative to the prior year, leading to declines in both revenue and profit. Please turn to page 6. As explained earlier, we achieved record-high net sales, operating profit, and net profit for the H1 period. Regarding gross profit, the gross profit margin decreased from 60.6% in the prior year period to 60% this period, a decline of 60 basis points. This was mainly due to a product mix shift, specifically the reduction in high-margin proprietary products like esophageal catheters and significant growth in lower-margin procured products such as neurovascular and hemostasis devices. Our proprietary sales mix declined from 57.6% to 55.1%, a decrease of 250 basis points.
The international sales mix increased from 2% to 2.6%, an increase of 60 basis points, reflecting the steady progress of our global expansion strategy. Earnings per share or EPS was JPY 68.08, an increase of JPY 6.21 year-over-year. This increase was helped by the reduction in the number of outstanding shares following the share buyback and cancellation executed in May 2024. Please turn to page 7. Operating profit reached JPY 6.62 billion, representing a year-over-year increase of JPY 359 million, or 5.7% growth. The increase was driven by the robust performance of core products and new therapeutic areas, which covered the negative impact of PFA. The total variance can be broken down into sales and cost factors, which contributed a JPY 593 million increase, and SG&A factors, which resulted in a JPY 234 million decrease.
As for sales and cost factors, we further divide them into volume factors and unit price factors. Regarding volume factors for core products, we saw a robust contribution of a JPY 913 million increase. Hemostasis devices contributed JPY 436 million, and defibrillation catheters contributed JPY 311 million, making them the largest contributors. Regarding volume factors for new areas, we saw a contribution of JPY 295 million increase. Neurovascular contributed JPY 161 million, and gastrointestinal contributed JPY 134 million. Regarding volume factors for other products, we saw a negative contribution of JPY 563 million. This figure included the PFA impact of a JPY 617 million decrease. This was partially offset by a positive contribution from exports of JPY 38 million. In terms of unit price factors, the net impact was a JPY 51 million decrease.
This figure includes the price revision impact of approximately JPY 90 million decrease, which was partially mitigated by continuous improvements in manufacturing costs and discounts due to increased procurement volume. Turning to SG&A factors, the first point is the SG&A increase. Excluding one-time factors, this represented a negative impact of JPY 639 million. Key increases included personnel costs of JPY 198 million, R&D expenses of JPY 192 million, and sales-related expenses of JPY 150 million. The second point is the one-time factor, a positive variance of JPY 405 million was recorded. This primarily relates to the partial collection of bad debt receivables, amounting to JPY 416 million. Please turn to page 8. Both sales and profits are progressing roughly in line with initial expectations. Sales achieved 49.4% of the full-year guidance. Profits achieved roughly 51%.
Profits were slightly above guidance, mainly due to the timing difference in SG&A execution and the collection of bad debt. While we had factored in recoveries from bad debts in our initial guidance, the actual amount recovered exceeded that projection by approximately JPY 30 million. This brings the cumulative recovery rate to about 70% to date. Please turn to page 11. Net sales increased by JPY 1.29 billion, representing 4.6% growth year-over-year. All segments except cardiac rhythm management achieved revenue growth. Growth was particularly strong in the existing cardiac area of EP ablation and the new therapeutic area of neurovascular. Existing areas contributed an increase of JPY 805 million, while new areas contributed JPY 536 million. Please turn to page 12. CRM sales were JPY 6.66 billion, resulting in a slight decline of 0.9% year-over-year.
The strong performance of our core product, S-ICD, compensated for the struggles of pacemakers, resulting in sales approximately flat with the previous period. We cite three highlights for this segment. The first is S-ICD. It achieved a 9.3% increase in revenue. Market expansion driven by the increase in preventive implantation was the driver. This refers to implanting the device to prevent sudden cardiac death before a lethal arrhythmia occurs. We believe this is a result of the active educational and awareness campaigns conducted by all companies in this field, including ourselves. In addition to that, replacement cases remained robust despite the launch of new competitor ICD products in the de novo implant market. The second is pacemaker-related products. These experienced a significant 19% decline. The penetration of competitor leadless pacemakers remains a headwind, accounting for approximately 30%-35% of the de novo implant market.
The segment was also negatively impacted by the two months of price revision effect, which resulted in a price reduction of about 14%. The third point is lead management products. These contributed new incremental revenue, as sales began in Q1. Please turn to page 13. EP ablation sales reached JPY 14.70 billion, an increase of 4.1% year-over-year. Core products achieved solid growth despite the penetration of pulsed field ablation. First, regarding the market conditions, we estimate that the number of atrial fibrillation or AF cases has increased by approximately 10% year-over-year. Looking at the quarterly breakdown, we estimate growth was 6% in Q1 and 13% in Q2. The timing of major academic conferences differed between this term and the same period last year, which created some unevenness in the quarterly figures.
However, this impact was normalized on a half-year basis, and the overall growth of about 10% for H1 is in line with our initial forecast. Regarding our performance, we have three key points. The first is intracardiac defibrillation catheters. This product saw revenue growth of 6.5%, which is mostly on track with our initial projections. This gap between revenue growth and case volume growth can be attributed to both volume and average selling price or ASP. In terms of volume, while our estimated market share remains high at 96% as of the end of September this year, we believe it has declined by 1 percentage point-2 percentage points from the previous term. As for the ASP, we implemented some strategic pricing measures to defend our market share against competitors. The second point is hemostasis devices. This grew significantly to 2.1 times the prior year's sales.
This was driven by new adoptions in high-volume facilities and expansion into medium and small-sized facilities. Thirdly, there was a PFA impact. PFA penetration reached approximately 60% of total AF cases by September. Within the PFA impact, esophageal temperature monitoring catheters declined by 49.1% as they are unnecessary in PFA procedures. Also, EP catheters declined by 4.9% as fewer units are required in PFA procedures. Regarding the outlook, we believe the total impact of further PFA penetration will be positive for our future performance. PFA shortens procedure time to about two-thirds of conventional procedures, acting as a driver for increased case volume. Increased case volume will positively impact our core products such as defibrillation catheters and hemostasis devices. Please turn to page 14. Cardiovascular sales were JPY 5.93 billion, achieving 5% growth year-over-year. Frozen elephant trunk or FET drove this growth. We have four key points regarding cardiovascular sales.
The first is FET. Sales increased by 5.6%. Sales were slightly below initial forecast due to a temporary decrease in FET case volume in Q2. We are actively executing FET-related seminars in anticipation of the high-demand period in Q3 and beyond. The second point is vascular grafts. Sales increased by 7.1%. The third point is abdominal stent grafts. Sales declined by 2.8%. The fourth point is other products. We began handling a sensor-tipped guidewire dedicated to TAVI from Haemonetics in Q2. We are looking ahead to the introduction of TAVI products in the latter half of our midterm plan. By launching related products starting from the current stage, we aim to build a strong product portfolio. Also, we started collaboration with Heartseed on the delivery catheter system for regenerative medicine product. Please turn to page 15. Neurovascular sales reached JPY 1.18 billion , achieving substantial growth of 48.4% year-over-year.
High growth continues, led primarily by aspiration catheters. We have three key performance points for neurovascular. The first is aspiration catheters. Sales grew 1.9 times year-over-year. A new model for peripheral vessels launched in Q1 was the key driver. Our estimated market share reached 20% as of September, advancing us to the third position in the industry. Secondly, embolic coils. Sales maintained strong performance with a 16% increase. The launch of a new model for interventional radiology departments in Q1 helped us expand the market beyond the neurovascular segment. The third point is stent retrievers. Sales continue to grow steadily. We plan to introduce a new model with a fluoroscopic marker starting in Q3, which we expect to further drive the growth. Please turn to page 16. GI sales were JPY 747 million, an increase of 25% year-over-year. Growth was primarily driven by bile duct tube stents.
We cite four key points regarding GI sales. The first is bile duct tube stents. This achieved a significant 29.7% increase. The new pigtail-type model, launched in Q1, performed better than expected and was a key sales driver. The second point is ERCP guidewires. Sales grew 3.1 times. Although growing steadily, sales were slightly behind expectations due to competition. Thirdly, GI stents. Sales increased by 10%. The prior year comparison base was low due to a voluntary recall of gastroduodenal stents. The last point is liver cancer ablation needles. Sales declined by 23.1%. This was mainly due to the transfer of sales to Terumo this period, resulting in a lower selling price. Let's talk about two business updates during the first half. Please turn to page 17.
On September 11, 2025, we announced in a joint press release that we will be co-developing and providing a catheter delivery system with Heartseed, a company specializing in regenerative medicine products. Heartseed is developing a unique remuscularization therapy for severe heart failure, and they are planning clinical trials to administer allogeneic iPS cell-derived cardiomyocyte spheroids using a catheter. This administration via a catheter is the specific area where we will be collaborating. Our company was chosen for several reasons: 1) Our proven track record as the top market shareholder in arrhythmia diagnostic catheters; 2) Our position as the only company in Japan with development and clinical experience in cell delivery catheters for the heart; and 3) Our possession of proprietary structures and patents to ensure safety during cell administration. The proprietary safety structures include two key features.
The first point is 3D mapping compatibility. This enables visual catheter manipulation and confirmation of the administration location. The second point is a mechanism utilizing a patent to detect when the cell dispensing port of the administration needle reaches the myocardium. When the sensing electrode at the needle's tip reaches the myocardial layer, the ECG shows a characteristic ST segment elevation, confirming the cell dispensing port is accurately positioned for transplantation, thereby increasing the precision of cell delivery. Going forward, both companies will continue to work closely together on the delivery catheter, and we plan to continuously update the delivery system to enable even safer and more precise administration. Please turn to page 18. This is the final slide. Our international expansion is planned in two steps.
Until the end of FY 2028, we are focusing on opening sales agencies in regions, primarily the Middle East and Asia, where Japanese approval can be leveraged directly. Following that, we aim to enter Europe and the largest medical device market, the U.S. Most recently, we have been actively working to secure distribution agreements in the Middle East and Asian regions. As of September 2025, we have signed agreements covering 23 countries and have already launched sales in 10 of those countries. Regarding the trend in our overseas sales, it has been on an upward trajectory since the beginning of this fiscal year. In the second quarter alone, sales reached just under JPY 400 million. This performance is approximately 10% ahead of our initial forecast.
We will continue to accelerate the global expansion of our proprietary products as a key growth strategy, and we ask for your continued expectations for our future. This concludes my presentation. Thank you for listening.