OSR Holdings Reports 16% Decline in Net Sales and $11.4 Million Loss in Q1 2025

OSR Holdings, Inc. reported a significant decline in financial performance for the first quarter of 2025, with net sales totaling $761,272, a decrease of 16% from $910,225 in the same period of 2024. The company's gross profit also fell by 30% to $168,686, primarily due to the termination of a key customer relationship with Penumbra, which negatively impacted sales for its subsidiary, RMC. The gross margin percentage decreased from 26.3% to 22.2%, attributed to unfavorable exchange rates affecting the cost of imported goods. The company anticipates continued revenue challenges in 2025 as it seeks to replace lost sales.

Operating expenses for the quarter were reduced by 13% to $3,086,512, largely due to a decrease in amortization expenses following a change in the useful life of certain intangible assets. However, the overall operating loss improved slightly to $2.9 million from $3.3 million year-over-year. The company recorded a substantial increase in other expenses, primarily due to one-time merger-related costs of approximately $8.5 million associated with its recent business combination, leading to a net loss of $11.4 million for the quarter, compared to a loss of $3.4 million in the prior year.

In terms of strategic developments, OSR Holdings completed a significant business combination with OSR Co., Ltd. on February 14, 2025, which involved an equity swap and resulted in the issuance of 16,282,047 shares of common stock. This acquisition is expected to enhance the company's portfolio in drug development, particularly in oncology and immunology. The company now holds approximately 67% of the outstanding shares of OSR, with plans to leverage its combined resources for future growth.

Operationally, OSR Holdings reported a cash position of $1.6 million as of March 31, 2025, a significant increase from $341,543 at the end of the previous year. The company has also entered into an equity line of credit agreement for up to $80 million to support ongoing financing needs. Despite the challenges faced in the first quarter, management remains focused on expanding its research and development efforts, with anticipated quarterly expenses of $2.5 million to $3.0 million starting mid-2025.

Looking ahead, OSR Holdings expects to navigate a challenging market environment while working to stabilize its revenue streams and enhance operational efficiencies. The company is committed to advancing its product pipeline and exploring new opportunities for growth, particularly through its recent acquisitions. However, the impact of the recent merger-related expenses and ongoing market conditions may continue to influence its financial performance in the near term.