News

The Management Board of Krka, d. d. held a press conference presenting to the public the performance results of the Krka Group and the Krka Company for the first nine months of 2015.

The Krka Group sold EUR 863.3 million worth of products and generated EUR 133.3 million of profit for the period (up 5%). The Krka Company sold EUR 827 million worth of products and generated EUR 134.9 million of profit for the period (up 12%).

Krka Group sales by Region

The leading sales region, where Krka generated EUR 242.3 million, which represents 28.1% of overall sales, is Region East Europe. It includes the Russian Federation, Krka's largest individual market, where rouble-denominated sales were up 7% in the reported period and totalled, in EUR, 168.7 million.

The second largest region in terms of sales was Region West Europe with EUR 237.3 million of sales, which is 27.5% of total Group sales. Compared to the same period last year, sales there increased by EUR 60 million, or 34%, which is the highest absolute as well as relative sales growth among all Krka's sales regions. The Region's largest individual market is Germany, where sales were up 46%. The other largest markets in terms of sales growth in the Region are the Nordic countries with a 75% increase, Spain with a 26% increase, France with a 5% increase and the UK with a 90% increase in sales.

Product sales in Region Central Europe represented 24% of Group sales, and amounted to EUR 207 million, up 5%. In Poland, the largest market in the Region, sales were up 11%. In Region South-East Europe sales totalled EUR 95.4 million, which is 11% of Krka Group sales and a decrease by 11% compared to last year's sales in the same period. Sales in the domestic market were up 2% to EUR 59 million, which represents 6.8% of total sales. Nine-month product sales in Region Overseas Markets totalled EUR 22.4 million, which represents 2.6% of overall sales and was an increase by 26% compared to the same period last year.

Krka Group sales by product and service group

The Krka Group sold EUR 725.3 million worth of prescription pharmaceuticals in the reported period, 2% more than in the same period last year. Prescription pharmaceuticals represent 84% of Krka Group sales.

The ten leading prescription pharmaceuticals in terms of sales are Atoris (atorvastatin), Lorista (losartan), Prenessa (perindopril), Nolpaza (pantoprazole), Enap (enalapril), Emanera (esomeprazole), Valsacor (valsartan), Aryzalera (aripiprazole), Roswera (rosuvastatin) and Zyllt (clopidogrel). Products are marketed under different brand names in individual markets.

Non-prescription product sales were down 13% compared to the same period last year, to EUR 74.5 million, which represents 8.6% of Krka Group sales. Animal health product sales were up 18% to EUR 39.1 million (4.5% of overall Group sales). Health resort and tourist services totalled EUR 23.1 million in revenues, up 2% from the same period last year (2.7% of total sales).

Research and development

In the period January–September 2015 Krka obtained marketing authorisations for 18 new products in 43 pharmaceutical dosage forms and strengths, and acquired 427 new marketing authorisations for 241 products in different markets.

Investments

In the first nine months of the year the Krka Group allocated EUR 69.7 million to investments, of which the controlling company invested EUR 54.3 million and subsidiaries EUR 15.4 million. Total investments, which also include commitments under existing contracts, amounted to EUR 122 million. Investments are primarily increasing and modernising Krka’s production capacities, and research and development capacities.

Estimated realisation of Krka Group objectives for 2015

Sales of products and services are expected to be a good two percent less than in 2014. East Europe is expected to be Krka's largest sales region, and the Russian Federation our most important individual market. Sales outside Slovenia are expected to account for 93% of total sales. Prescription pharmaceuticals will remain the most important product group, accounting for over 83% of total sales. The 2015 full-year profit is forecast at the level of last year's.

Over EUR 100 million will be invested in 2015 into our R&D, production and infrastructure capacities included in the plan for 2015; total investments in 2015, which also include commitments under existing contracts, will amount to EUR 182 million.

At the year-end of 2015 the Krka Group is planned to have 10,900 employees, 55% in its companies outside Slovenia.

Krka Group plans for 2016

The Krka Group plans to report EUR 1.210 billion of product and service sales and a profit of a good EUR 160 million for 2016. They will earmark EUR 162 million for investment projects, primarily invested into increasing and modernising their production capacities and infrastructure. The number of employees is planned to increase in 2016 both in Slovenia and abroad, by a total of more than 4%, to over 11,100. Plans for 2016 have been prepared taking into account certain assumptions such as price levels, foreign currency rates, conditions in individual markets, etc., which were considered during the preparation of the plan. In the event that the actual operating conditions in 2016 significantly deviate from the assumptions, actual results may deviate from the planned.

Krka strategy for 2016-2020

In November, the Management Board adopted the development strategy for the Krka Group for the period 2016-2020. For the new five-year strategic period it is envisaged moderate sales growth, while the net profit, in the case of organic growth, in the first year of the new strategy remained at the current level. In addition to organic growth, the Krka will even more intensively search for takeover opportunities to acquire new markets and products. Investments, mainly aimed to production and research and development capacities and infrastructure are provided at a similar level as in recent years. Employment at home and abroad will be moderate, adjusted provided organic growth. Krka will continue to pursue a dividend increase policy whereby up to 50% of the consolidated net profit from the previous year as attributable to equity owners of the parent is allocated to dividends, and whereby the proportion of each year's profit for the period devoted to dividend payments depends on the Company's financial requirements connected to investments and acquisitions.

Appointment of the Management Board for a next six-year term-in-office

The term-in-office of Jože Colarič, Zvezdana Bajc, Aleš Rotar PhD, Vinko Zupančič PhD, and worker director Danica Novak Malnar, all current members of the Krka Management Board, expires on 31 December 2015.

At a meeting in January 2015 the Supervisory Board decided to reappoint Jože Colarič as President of the Management Board and Chief Executive for a six-year term-in-office, starting 1 January 2016. The Workers Council at a meeting on 28 September 2015 nominated Milena Kastelic as Worker Director.

At its meeting in November 2015 the Supervisory Board decided that the next term-in-office for the Management Board of Krka, d. d., Novo mesto, would last from 1 January 2016 to 31 December 2021, and that Aleš Rotar PhD, Vinko Zupančič PhD and David Bratož would be appointed as members, in addition to the President of the Management Board and Chief Executive Jože Colarič and Worker Director Milena Kastelic. David Bratož and Milena Kastelic thus became new members of the Management Board.

David Bratož, born in 1976 in Novo mesto, holds a university degree in economics. Through his successful leadership Krka became one of the leading generic pharmaceutical companies in Poland.

Milena Kastelic, born in 1968 in Novo mesto, holds a university degree in food technology. She has successfully worked in Krka since 1992. Throughout her career her work has focused on herbal and OTC medicines. She is Head of Krka’s plant in Bršljin, Novo mesto.

More in press release