21. 11. 2019
Product and Service Sales by Region
The most successful sales region of the Krka Group was Region East Europe, which generated €339.7 million or 31.2% of total Krka Group sales. Year-on-year, sales grew by 18%. Region Central Europe, comprising the Visegrad Group and the Baltic states, followed with €252 million or 23.2% of total Krka Group sales.
Region West Europe was the third largest region in terms of sales, accounting for €243.1 million or 22.4% of total Krka Group sales. Year-on-year, the growth was 16%. Product sales in Region South-East Europe amounted to €145.6 million, 10% more than in the same period last year, accounting for 13.4% of total Krka Group sales. In Slovenia, sales made €69.9 million, accounting for 6.4% of total Krka Group sales. The growth rate was 5%. The largest portion of total sales was generated by product sales with €40 million. Health resorts and tourist services yielded €29.9 million. Product sales in Region Overseas Markets totalled €37.3 million, achieving 14% growth and 3.4% share of total Krka Group sales.
Sales by Product and Services Group
The Krka Group sales of prescription pharmaceuticals totalled €914.9 million, 14% more than in the same period last year, accounting for 84.1% 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 5%, generating €91.7 million (8.4% of total Group sales). Sales of animal health products grew by 1% and totalled €51.1 million (4.7% of total Group sales). Health resorts and tourist services yielded €29.9 million, a 6% year-on-year increase (2.8% of total Group sales).
In the first nine months of 2019, we received marketing authorisations for 13 new products in 30 dosage forms and strengths. From January to September 2019, the Krka Group allocated €81.1 million to investments, of that €66.3 million to the controlling company. Our investments were aimed at increasing and technologically upgrading production and development, and providing quality assurance. We also invested in our own production and distribution centres around the world.
At the end of September 2019, the Krka Group had 11,481 employees, of that 5,683 abroad, which accounts for just over 49% of the total Krka Group headcount. The proportion of Krka Group employees with at least university-level qualifications was 53%. This includes 195 employees with a doctoral degree. Together with agency workers, the Krka Group had 12,625 persons on payroll or 143 more than at the end of 2018.
2019 Krka Group Performance Estimate
Annual sales of products and services are projected to exceed the plans and are estimated at €1,430 million. The projected 2019 sales growth estimate is more than 7%. Sales outside Slovenia are expected to account for 94% of total sales.
Region East Europe is expected to be the largest sales region. The Russian Federation is expected to remain the largest individual market. Region Central Europe with Poland as the second largest individual market of the Krka Group is expected to record second strongest sales. The third largest region in terms of sales is expected to be Region West Europe with the third largest individual market – Germany. Regions South-East Europe, Slovenia, and Overseas Markets are expected to follow.
Prescription pharmaceuticals are expected to remain the most important product group, comprising 83% of total sales. Net profit will be above the plans and is estimated at just over €200 million. We plan to allocate €114 million to investments in our own development, production, and infrastructure facilities. The figure is below the initial plan due to technical and commercial optimisation. All planned investments will be completed. At the end of 2019, the Krka Group is expected to have more than 12,000 regular employees in total, half of them abroad.
2020 Krka Group Plans
According to the 2020 plan, the Krka Group sales are projected at €1.520 million and profit at just over €210 million. Krka intends to allocate €134 million for investment projects to increase and modernise production capacities and infrastructure. We plan to increase the number of employees in Slovenia and abroad by 3%. At the end of 2020, the total number of regular employees is projected to exceed 12,300.
The 2020 operations plan derives from the Krka Group development strategy 2020–2024. It is based on estimates, assessments, projections, and other available data at disposal to the Management Board. The Management Board believe the projections are reasonable. Should the business conditions in 2020 differ significantly from the projections, operating results may also be different from the plan.
Krka Group Development Strategy 2020–2024
The Supervisory Board approved the Krka Group development strategy for the 2020–2024 period. In the upcoming five-year strategic period, the average annual sales growth in terms of volume/value is projected at 5% at minimum.
The strategy keeps all the key elements, objectives, and guidelines from the strategy revised two years ago for the 2018–2022 period. Even more emphasis is put on the care for the quality of products and all business processes, supply, further digitalisation and automation of all business processes, and investments in China.
In the coming years, we intend to continue making wise investments in our own development, production, and infrastructure facilities, and allocate to that an average of almost €136 million annually. Three quarters of investments will be allocated for capacities for the production of active ingredients and finished products. In addition to organic growth, we also wish to ensure growth through long-term business partnerships (including joint ventures) and acquisitions, when interesting target companies become available. The primary goals are to secure new products and/or markets.
More information in press release.