Business news

Pharma group Krka's net profit up 11% in H1 to EUR 177m

Novo Mesto, 29 July (STA) - Slovenia's pharma group Krka Group saw its net profit rise by 11% to EUR 177.4 million in the first six months on record sales revenue of EUR 808.6 million, according to unaudited data.

Sales revenue was up by 1% compared to the same period last year and 6% higher than in the first six months of 2019, Krka said in a press release published on the web site of the Ljubljana Stock Exchange after the supervisors reviewed the results on Wednesday.

The group generated 95% of sales in markets outside Slovenia.

In East Europe, the group's largest region in terms of sales, sales revenue was up 2% to EUR 276.5 million. In Russia, sales dropped by 7% to EUR 168.2 million while the sales in local currency were up by 10%.

In Central Europe, which includes the Visegrad Group countries and Baltic countries, sales were up by 3% to EUR 188.9 million. In Poland, revenue increased by 2% to EUR 87.6 million.

Western Europe was the only region to see a drop in revenue, by 12% to EUR 159.6 million, reportedly due to the absence of new calls for applications. However, sales were up in the UK, France, Ireland and Austria. But they were the highest in Germany and France, Krka said.

In South East Europe, sales increased by 8% to EUR 112.3 million.

In Slovenia, EUR 41.8 million in sales was generated, up 9% from the same period last year. The revenue from products sale reached EUR 28.4 million and from spa and tourist services EUR 13.3 million.

Krka Group sold EUR 27.5 million worth of products overseas, which is 14% more than in the first half of 2020.

Operating profit before interest, taxes, depreciation and amortization (EBITDA) totalled EUR 255 million, 7% down on the first half of 2020. Operating profit (EBIT) reached EUR 200.5 million, a 7% decrease year on year.

Due to favourable exchange rate movements, a positive net financial result of EUR 6.7 million was generated.

The core company generated EUR 711.8 million in sales revenue, down 9% from the first six months of 2020. Net profit dropped by 1% to EUR 154.6 million.

EBITDA decreased by 17% to EUR 208.7 million, while EBIT was down 20% to around EUR 166 million.

The group, which had 11,607 employees at the end of June or 12,524 if agency workers are included, allocated EUR 29.5 million for investment in the first six months, including EUR 22.5 million in the controlling company. Development costs totalled EUR 75.6 million.

The group plans to generate EUR 1.535 billion in sales revenue this year and some EUR 265 million in profit.

CEO Jože Colarič labelled the results as excellent, saying the group would continue on this path.

The supervisors also endorsed Colarič's proposal to grant another term to management board members Aleš Rotar, Vinko Zupančič and David Bratož.