Krka presented its operating results for the first two quarters of 2019

Product and Service Sales by Region
The largest sales region of the Krka Group was Region East Europe, which generated €251.5 million or 33.1% of total Krka Group sales. Year-on-year, sales grew by 15%. Product sales in the Russian Federation totalled €166.8 million, up 9% year-on-year corresponding to a 12% sales increase expressed in the Russian rouble. In Ukraine, product sales added up to €35.9 million, an upsurge of 51%. We recorded double-digit growth rates in most regional markets.

Region West Europe followed with €170.4 million or 22.5% of total Krka Group sales. Year-on-year, sales grew by 17%. Sales were the strongest in Germany, the Scandinavian countries, and Spain. Sales of our own product brands through subsidiaries increased by 26%, and accounted for 75% of total regional sales. The Scandinavian countries, Spain, Portugal and the United Kingdom recorded highest sales increases.

Region Central Europe that comprises the Visegrad Group and the Baltic states, was the third largest region in terms of sales value accounting for €169.1 million or 22.3% of total Krka Group sales. Year on year, the growth was 5%. Poland, the leading market, generated sales total of €79.5 million, and recorded 6% growth. Sales also went up in Hungary, Slovakia, Lithuania, and Estonia.

Product sales in Region South-East Europe amounted to €98.7 million, 12% more than in the same period last year, accounting for 13% of total Krka Group sales. Romania and Croatia were our two key markets in the region. However, we recorded the highest growth rates in Bulgaria and Serbia.

In Slovenia, sales made €45 million accounting for 5.9% of total Krka Group sales. The growth rate was 4%. Product sales generated €26.6 million, the largest portion of total sales. Health resorts and tourist services yielded €18.4 million.

Product sales by Region Overseas Markets totalled €24.6 million achieving 13% growth and 3.2% share of total Krka Group sales.

Sales by Product and Service Group
The Krka Group sales of prescription pharmaceuticals totalled €642.6 million, 13% more than in the same period last year, accounting for 84.6% of total Krka Group sales.

Ten leading prescription pharmaceuticals in terms of sales were product groups containing valsartan (Valsacor, Valsacombi, Vamloset, Co-Vamloset*, Valarox), perindopril (Prenessa, Co-Prenessa, Amlessa, Co-Amlessa), losartan (Lorista, Lorista H, Lorista HD, Tenloris), atorvastatin (Atoris), pantoprazole (Nolpaza), rosuvastatin (Roswera, Co-Roswera), esomeprazole (Emanera), enalapril (Enap, Enap H, Enap HL, Elernap), clopidogrel (Zyllt), and tramadol (Doreta, Tadol). All pharmaceuticals mentioned above are marketed under different brand names in individual markets.

Year-on-year sales of non-prescription products advanced by 7% generating €62.5 million (8.3% of total Group sales). Sales of animal health products grew by 2% and totalled €35.8 million (4.7% of total Group sales). Health resorts and tourist services yielded €18.4 million, a 6% year-on-year increase (2.4% of total Group sales).

Research and Development
In the first two quarters of 2019, we obtained marketing authorisations for six new products in 12 dosage forms and strengths. 

Investments
In the first two quarters of 2019, the Krka Group allocated €52.6 million to investments, of that €42 million to the controlling company. Our investments were aimed to increase and technologically upgrade production and development, and provide for quality assurance. We also invested in our own production and distribution centres around the world.

Employees
The Krka Group employed 11,523 persons at the end of June 2019, of that one half (5,744 persons) outside Slovenia. The proportion of Krka Group employees with at least university-level qualifications was 53%. This percentage includes 189 employees with a doctoral degree. Together with agency workers, the Krka Group had a total of 12,590 persons on payroll or 108 more than at the end of 2018.

2019 business plan
The 2019 plan projects sales at €1.375 billion and net profit at €172 million. We intend to allocate over €124 million to investment projects, primarily to increase and upgrade production facilities and the infrastructure, and 10% of our revenue to research and development.

The Management Board is optimistic about the 2019 business year. If the conditions in our main markets remain roughly the same until the end of the year, we estimate that sales and especially profit will exceed our plans.

More information in press release.