Slovenian Company Krka Receives 45.3 Million Euros of Profit in the First Quarter of 2017
In the first quarter, the Slovenian company Krka increased net profit by 38% as compared to the same period last year. The total profit amounted to 45.3 million euros.
The lion’s share of sales in Krka fell on the East European market (101.8 million euros). “The decisive factor was the growth in the largest and most important for us Russian market,” the Company notes. Russia sold goods worth 73.8 million euros, which is 31% more than in the same period last year.
In terms of sales volume, the Russian market is followed by the countries of Central Europe (76.9 million) and Western Europe (71.7 million). Goods and services for the sum of 38.7 million euros were sold in the South-Eastern Europe, and of 21.1 million euros – on the domestic market. In general, the volume of sales, as compared to 2016, increased in all statistical regions, except for the Western Europe.
The volume of domestic sales amounted to 21.1 million euros and was 5% higher than the indicator of the first quarter of 2016. Krka with a 9.2% market share retained its leading position among pharmaceutical companies in Slovenia. Krka sold prescription preparations worth 264.4 million euros, which is 8% more as compared to the last year’s figure. Proceeds from the sale of over-the-counter medicine amounted to 30.9 million euros (13% more than in the first quarter of 2016).
Currency Exposure Is in Russian Rubles
Currency fluctuations in the first quarter were favourable for the largest currency exposure of the group in Russian rubles. In this period, the policy of partial hedging of Russian ruble continued and, thereby, the volatility of the net financial result decreased. In connection with the strengthening of the ruble, it was possible to reach a positive exchange rate and cover the financial costs on futures contracts. Considering both positive factors, the result of the currency exposure action in Russian rubles in the first quarter of this year was positive.
The modernization of production in the first quarter of 2017 involved 21.4 million euros, 18 million of which fell within the parent company. On the territory of the Krka head office in Novo Mesto, the Centre for Quality Control and Development is being built, which will be a key project for the next few years. The Centre’s construction budget is estimated at 54 million euros. The installation of the laboratory and technological equipment has been already started on the site, and its commissioning is scheduled for the end of 2017.
In the first quarter of this year, the Slovenian company Krka sold goods and services for the sum of 312.2 million euros surpassing the last year’s record by 19%. Operating profit amounted to 45.7 million euros (16% more than in the 2016 accounting period). Net profit increased by 38%%, reaching 45.3 million euros.
Telekom Group Also Boosts Its Net Profit
In the first quarter of this year, the Telekom Slovenije Group received 180 million euros of income from sales, surpassing the last year’s level by 2%. The net profit of Telekom rose by 12%, reaching 9.7 million euros.
During the same period, the Telekom Slovenije parent company increased its net income by 8% (13.41 million euros), while the net income from sales reached 164.08 million euros, according to the results of the quarter.
The total sales revenue rose largely due to earnings from the wholesale and the broadband Internet access services, as well as the IT-services. A decline was expected in revenue from the fixed telephone services through its displacement by the mobile and IP-Telephony services, as the Telekom noted.
Revenues in the Mobile Services Market Decrease
Detailed data show that revenues in the mobile market segment decreased by 10%, and in the fixed market segment (communication, BBA) – rose by 3%. Other categories of revenues from sales of goods and services increased by 162%. Revenues from wholesale market grew by 7%, and new sources of income – by 20%.