Annual Report (ESEF) • Apr 11, 2025
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Download Source FileDear shareholders, business partners and employees,
Our clear strategic objectives promote stable growth, new investment and development projects, expansion into new markets, risk management, and share value, increasing our company’s overall value. This, combined with low debt, effective cash flow management, and prudent decision-making, enabled us to remain resilient and ensure a reliable supply of our products to patients in 2024 despite the complex situation on global markets.
We recorded the highest sales and EBITDA to date.
We successfully delivered on all our key objectives and the Krka Group’s strategic guidelines. We are especially pleased that we maintained our planned growth last year. The Krka Group generated €1,909.5 million in revenue, up 6% on 2023. We recorded €520.1 million EBITDA, the highest since incorporation, outstripping our previous record by 3%. Net profit totalled €356.2 million, and ROE to 16.1%.
We produced a record volume of tablets and capsules.
Demand for our products has been rising due to their innovation and high quality. In 2024, we manufactured and packed 18.9 billion tablets and capsules, up 12% on 2023. We are especially proud of this accomplishment, as we increased the production of finished products across several production sites. Despite the varied purchasing market circumstances followed by raw material shortages, an energy crisis, and global transport issues, we managed to reduce the lead time and bring our responsiveness and flexibility in the supply chain to even higher levels.
We make healthcare accessible to over one-hundred million people per day.
Our products can significantly improve the health of patients and the quality of their lives. Our innovations are designed with patient needs and requirements in mind, facilitating therapy, improving patient adherence, and optimising treatment outcomes. We develop and manufacture advanced pharmaceutical forms, such as prolonged-release tablets, matrix tablets, and tablets that incorporate OROS technology. We are also among the leading pharmaceutical companies in capsule-filling pellet manufacturing and development. We are also recognised on our markets for our innovative combination medicines, which contain two or more active pharmaceutical ingredients. These products improve patient adherence, making therapy even more effective. Combination medicines account for over 30% of our overall sales. Our marketing mix comprises 150 combination medicines, more than that of any other generic pharmaceuticals manufacturer.
Some patients find large pills hard to swallow, so we have developed chewable tablets to meet their needs. Our folding boxes are printed in Braille to aid the blind and visually impaired. Many of our medicines are designed to withstand hot climate conditions. In developing, emerging and frontier markets, we currently market more than 50 medicines from the WHO Model List of Essential Medicines to meet one of our objectives – to ensure accessible healthcare. Our priority sustainability areas are product quality and patient safety. Audits and inspections performed in 2024 attest that our products are high-quality, safe, and effective. They are used to help over 100 million patients every day.
Through six sales regions, we are present in over seventy countries.
We are proud to have one of the most robust marketing and sales networks of all pharmaceutical companies. We have subsidiaries and representative offices in Europe and beyond. We have established sales channels with equity-unrelated partners in certain countries. We strive to market as many products in as many countries as possible. Exports account for more than 94% of overall Krka Group sales. We market our products through six sales regions: Region East Europe; Region Central Europe; Region West Europe; Region South-East Europe; Region Slovenia; and Region Overseas Markets. All our regions experienced growth, except Region West Europe, primarily due to a shortage of goods.
pharmaceuticals last year. Product sales totalled €373.3 million, up 8% on 2023. More than three-quarters of the products sold in the Russian Federation are manufactured locally. In Ukraine, another of our key markets, we have faced several challenges in recent years. In 2024, we increased product sales by 15% to €96 million and ranked second among foreign providers of generic pharmaceuticals in the country. We are also pleased with our €63.6 million sales in Belarus, Mongolia, Armenia, and Azerbaijan, up 11% year on year. Our year-on-year product sales in Belarus, Azerbaijan, and Armenia saw double-digit growth. In addition, Kazakhstan, Moldova, and Kyrgyzstan saw a 10% year-on-year increase and generated product sales of €46.1 million. In Uzbekistan, Georgia, Tajikistan, and Turkmenistan, our product sales totalled €71.3 million, up 10%. All four countries presented positive trends.
Region Central Europe generated product sales of €426.5 million, up 7%. In Poland, another of our key markets, we recorded the highest sales increase in terms of value and again ranked third among foreign providers of generic pharmaceuticals. Product sales totalled €206.1 million, up 14% on 2023. Sales in Lithuania were also up 14%, and the two countries recorded the highest market growth in the region. Sales in Lithuania totalled €34 million. As a result, we retained our position as the leading provider of generic pharmaceuticals in the country. In Hungary, we ranked third among primarily foreign providers of generic pharmaceuticals. Year-on-year sales totalled €53.3 million, up 2%. In Slovakia, we recorded product sales of €42.9 million, on par with 2023 sales figure. In Latvia, sales reached €19 million in 2024, a 4% year-on-year rise. We consolidated our position as the leading provider of generic pharmaceuticals in the country. In Estonia, sales totalled €12.6 million, up 3% on 2023.
The markets of Region West Europe are collectively regarded as key markets for us. Regional sales amounted to €351.8 million in 2024, down 5% year on year. Germany, the Scandinavian countries, Portugal, Italy, and the United Kingdom recorded the highest sales. In Germany, our product sales reached €83.4 million, ranking us eighth among foreign providers of generic medicines and the leading provider of certain medicines containing fixed-dose combinations in the country. Our sales in Scandinavia generated €68.5 million, up 9% on 2023. Many of our products were best-sellers in the market. Our Portuguese product sales totalled €33.8 million, and several of our products were the leading products in their respective segments. In Italy, we generated product sales of €27.6 million, with a significant increase in sales of our animal health products. Sales in the United Kingdom increased by 40% year on year, reaching €27.1 million.
Sales generated by Region South-East Europe totalled €269 million, up 8% on 2023. We recorded growth across all regional markets. Absolute growth, however, was the highest in Romania, where our sales increased by €5.2 million. We ranked fifth among foreign providers of generic pharmaceuticals in the country, our largest market in that region. Sales in Croatia, our second market in the region for sales, increased by €3 million on 2023. We ranked second among foreign providers of generic pharmaceuticals. Our products are well-established in many other regional markets. Serbia generated €39.1 million in sales, up 4% year on year, ranking it third among regional markets. Sales in Bulgaria totalled €30.2 million in 2024, a 13% year-on-year increase. Our product sales in North Macedonia totalled €29 million, an 8% year-on-year increase, and remained the leading foreign provider of generic pharmaceuticals in the country. We recorded sales of €23.4 million, up 9%, and remained the leading foreign provider of generic pharmaceuticals in Bosnia and Herzegovina. We bolstered our market presence in Kosovo, Albania, Montenegro, and Greece.
Region Slovenia is also our key market. Product and service sales totalled €121 million in 2024. Product sales were valued at €71.7 million, up 8%. Health resort and tourist services generated €49.4 million, up 3% year on year, contributing 6% to sales growth in the domestic market.
The Krka brand has also been enjoying increasing success outside our traditional markets. Our direct market presence, particularly in China and, since 2024, in India, has further bolstered our marketing position. Our medicines are also used to treat patients in Saudi Arabia, Australia, Iran, Vietnam, and the Caribbean. Region Overseas Markets generated sales of €81.1 million, up 8% on 2023. Our product sales in China alone totalled €15.3 million, up 12% on 2023. Our paramount products were prescription pharmaceuticals marketed under Krka brands.
Prescription pharmaceuticals are our paramount product group. We are an essential partner in the treatment of most widespread diseases. At 2024 year-end, our portfolio comprised over 1,000 products in various dosage forms and strengths. We primarily market them under Krka brands in most European countries.
Our core business is the production of pharmaceutical products, of which prescription pharmaceuticals accounted for 82.5%, non-prescription products 9.0%, and animal health products 5.9% in 2024. Last year, sales of new products, i.e. products launched in individual markets in the past five years, accounted for 24% of Krka Group overall sales, or 2 percentage points up on the previous year.
With the high prevalence of cardiovascular diseases, cardiovascular agents remain our top priority. They accounted for almost 55% of overall sales and remained our central product group. It especially pleases us that Krka has been the leading producer of several major generic varieties from this product group in Europe and globally. Our major products for high blood pressure and high cholesterol level control include perindopril-, valsartan-, losartan-, statin-, and rosuvastatin-based medicines. Central nervous system agents and medicines for the gastrointestinal tract in that order are our next major product groups. We are the leading provider of generic medicines from these two product groups in Slovenia and markets in central, eastern, and south-eastern Europe. Many patients rely on our medicines for pain relief, diabetes management, oncology treatment, and conditions affecting blood and blood-forming organs.
Last year, the Krka Group created €171.3 million in sales of non-prescription products. End-users favour our cough and cold remedies, analgesics, and vitamins and minerals. Our animal health products for companion and farm animals also saw significant growth. The Krka Group generated €111.8 million in sales of animal health products last year. Companion animal products recorded the highest growth, accounting for over 70% of overall animal health product sales. Also, sales of health resort and tourist services, constituting 2.6% of overall Krka Group sales, saw an increase.
Our experts work on 170 development projects. Aiming to improve the health of our medicine end-users, research and development drive our progress and sustainable growth. We initiate development and market authorisation to roll out and manufacture a new product as soon as a patent expires. We use our know-how and innovations to provide patients with safe, quality, efficacious, and affordable contemporary medicines.
We dedicate approximately 10% of our revenue annually to research and development. Only last year, we invested almost €185 million in research and development, two-thirds into new products, and one-third in ensuring top quality throughout each product’s lifecycle. We build our future on an extensive development portfolio and superior technologies that also exploit robotics and machine learning (AI), allowing us to optimise our production processes.
More than 800 Krka experts work on 170 development projects to extend our range of medicines in key therapeutic classes, such as medicines for treating high blood pressure, diabetes, conditions of blood and blood-forming organs, and cancer. We are dedicated to using energy-efficient technological solutions, enabling competitive pricing for new products. Starting at the development stage, we work to minimise the impact of our technological procedures, carbon footprint, water consumption, and organic solvent use, and by doing so, aligning our efforts with circular economy objectives.
With a strong understanding of national and regional regulations, we can define target properties for each product early in development, ensuring compliance with specific market requirements and tailoring the development process accordingly. This enables us to provide access to contemporary medicines in the shortest possible time, including for patients in developing countries and regions. We leverage the latest scientific research and data from our research and development studies to design our products, using state-of-the-art methods and equipment for their development.
In 2024, we expanded our product range with twenty-two new products, including eighteen new prescription pharmaceuticals, three additions to our portfolio of consumer health products and food supplements, and one veterinary medicine. In 2024, we finalised over 1,000 registration procedures for new and already established products and received approvals for more than 24,000 regulatory variations to ensure uninterrupted supply to various markets.
In 2024, we filed nine patent applications for new technological solutions we had developed and evaluated as inventions at the global ranking level. Based on priority applications from 2023, we filed seven international and two European patent applications. We were granted four patents in various countries.
Our investments align with sustainable development principles. Constant investments in production, research-and-development and other capacities guarantee our continuous growth. We apply sustainable development principles in all our investment projects and introduce the best available technologies to ensure a safe work environment and minimal environmental impact.
The Krka Group allocated €116.9 million to investments last year. We upgraded systems and instruments in most of our production facilities, further boosting our production capacities and product quality. The investments primarily targeted the production of finished products, information and documentation management systems, intangible assets, and infrastructure.
We installed new technological equipment in the Notol Department, one of our biggest solid dosage form production plants at our central site in Novo mesto, Slovenia. We replaced several packaging lines and are currently investing in upgrading and expanding granulation capacities and tablet compression output. Additionally, we are upgrading the logistics system and various supporting systems. These investments guarantee that our Notol Department will operate reliably for the next twenty years and beyond.
We completed the construction of Paviljon 3, a multi-purpose building in Novo mesto, Slovenia. It houses additional microbiology laboratories, Library and Information Services, and training facilities. The new facility provides enhanced conditions for the microbiological quality of pharmaceutical products. It allows our experts quick access to essential information for product development and facilitates knowledge enhancement in computing, digitisation, and information systems.
Last year, we successfully completed an energy upgrade project at our wastewater treatment plant in Ločna, Novo mesto, Slovenia, by exploiting captured excess effluent temperature for heat generation, further safeguarding the environment in which we operate.
We also made investments in our subsidiaries outside Slovenia. At the production and distribution centre in Jastrebarsko, Croatia, we increased production capacities for solid forms of products for veterinary use. We also implemented upgrades at our subsidiaries TAD Pharma and Krka - Polska.
We plan to build a new production plant in India. We have production plants in Slovenia, the Russian Federation, Poland, Germany, Croatia, and China. We intend to build a major plant for API and finished product manufacturing in India in the near future.
In India, we established a joint venture named Krka Pharma Pvt. Ltd., in partnership with our long-standing Indian business partner Laurus Labs Ltd., with Krka holding a 51% stake. Registered capital of up to €50 million will be paid in gradually as needed. We have agreed with our co-founding partner to build a production plant in Hyderabad, and the joint venture has already begun drafting the project design. Progress has been swift, and we anticipate completing the project in approximately two years, with a total investment of around €30 million.
The core businesses of both co-founders are complementary, and we anticipate that the project will deliver synergies, allowing both companies to expand into new markets and consolidate their positions among the leading generic pharmaceutical manufacturers. Headquartered in India, the joint venture is designed to sell products in India and other countries outside the European Union, where Krka and Laurus have not yet established a presence.
We received the 2024 S&P Global Corporate Sustainability Assessment from S&P Global. In 2024, a market intelligence agency S&P Global CSA assessed the sustainability of the Krka Group business operations again. We scored 56 out of 100, marking a 6 percentage-point increase from our initial score. As of 31 January 2025, our score ranked us among the top 10% of the companies in the pharmaceutical industry. Compared to 2023, when our score was 50, we improved our environmental score by 20 percentage points. We also scored higher as per social and corporate screening criteria. The independent sustainability rating validates the Krka Group’s sustainable management practices and ESG governance, which prioritise corporate social responsibility and care for the health and well-being of patients.
We ranked among the top 348 assessed companies, demonstrating our commitment to providing quality, safe, and effective medicines manufactured in compliance with the highest GMP standards. This ranking also reflects our dedication to environmental protection and our adherence to the highest standards of business conduct, integrity, and transparency in Krka Group governance.
Krka employees create a dynamic and development-oriented business environment. We, the Krka Group employees, create a dynamic and innovative business environment to pursue our mission ‘Living a healthy life’ through expertise, professional skills, creativity, and teamwork. We foster a culture of lifelong learning, prompt problem-solving, and efficient action to achieve our ultimate goal.
Modern technology facilitates unprecedented development, but it is our employees – through their expertise and global mindset – who drive business success and navigate the multifaceted challenges of daily operations and market dynamics. We operate in diverse cultural settings. Our company’s international footprint provides employees with opportunities to work in our subsidiaries and representative offices abroad. Daily global collaboration fosters a culture of trust and unity while facilitating the effective exchange of good practices.
At the end of 2024, the Krka Group had 12,810 employees on its payroll, with 5,247 or 41% working outside Slovenia. Among all employees, 47% hold at least a university-level qualification, including 202 with a doctoral degree. When accounting for agency workers, the Krka Group had 12,857 persons on its payroll. By the end of December 2024, Krka had transitioned all agency workers to direct employment.
We scored the highest overall excellence index of all domestic companies. Krka retained its leading position among Slovenian companies surveyed for business excellence, as confirmed by the sixth consecutive Slovenian Business Excellence survey conducted by Ninamedia, a market research and public opinion polling agency.
The overall excellence score factored in twenty indicators from four main categories: corporate visibility, performance, reputation, and sustainable operations. Both the general public and the expert community rated us highly in all four categories, positioning Krka among the most visible, successful, reputable, and sustainability-oriented companies. As per their scores, we achieved the highest overall excellence index.
In 2024, the Krka share price increased by just over 26%. I believe our business results demonstrate that investing in our company is a safe choice. Our performance indicators suggest strong potential for asset growth, a stable dividend policy, and continued increases in shareholder value in the future.
At the end of 2024, Krka had 47,243 shareholders. We are pleased that a growing number of domestic retail investors are opting to invest in Krka shares. Traditionally, investors have enjoyed high dividend yields compared to other financial investments and shares, and the Krka share price continues to rise. In line with the resolution of the latest AGM, we allocated 73.6% of the consolidated net profit attributable to equity holders of the controlling company generated in 2023 for the dividend payout. Gross dividend per share increased by 13.6%, marking a record dividend payout of €7.50 gross per share.
We provided shareholders and analysts with transparent and regular information about key business events, Krka’s performance, strategy, and plans. We participated in 13 investment conferences attended by investors from over 15 countries. We hosted four webcasts to present our quarterly business reports. In recognition of our exemplary shareholder communications, the Ljubljana Stock Exchange awarded Krka the Best Investor Relations Award for 2024.
We embrace change in the business environment with a proactive mindset. Our deep understanding of the environment we operate in, combined with our flexibility, responsiveness, and resilience, enables us to identify new opportunities and strengthen our market position. Today, we are among the world’s largest manufacturers of generic pharmaceuticals, and I believe we have every opportunity to grow even further. We respond to challenges by investing in talent and equipment, optimising operations at every level, and developing new products. Our goal is to launch these products immediately after patent protection expires, maximising added value.
The generic pharmaceutical industry will continue to evolve in the future. Healthcare systems are increasingly turning to high-quality, safe, effective, and, at the same time, more affordable generic medicines. This is why I see great opportunities for Krka’s growth. Our plans are ambitious, yet we recognise that market conditions will continue to shape our performance. If the trends from 2024 persist, I am confident that our results in 2025 will be even stronger. We aim to set a new milestone by surpassing €2 billion in Krka Group sales for the first time since our incorporation. In line with this goal, we have raised our initial 2025 net profit target from €354 to €365 million. Our investment plans have also grown significantly, reaching €150 million, marking a substantial year-on-year increase. Additionally, we aim to break production records by manufacturing, packaging, and selling over 20 billion tablets and capsules.
Our success is driven by investments in new products, production capacities, technological advancements, market expansion, all underpinned by rigorous due diligence. Equally, we invest in our employees, environmental protection, reduced energy consumption, and the development of the broader community. We primarily leverage our in-house know-how and resources. I also want to emphasise our agility in bringing new products to market and responding to market developments. Speed and flexibility, two of our core values, coupled with quality, are our key competitive advantages. Finding the path to the top is never easy, but at Krka, we have the know-how, experience, and resolve we need to succeed. Flexibility and innovation pave new paths, while our clear strategy keeps us on course. We are preparing for new challenges with confidence and responsibility. That is why I firmly believe that we will keep the Krka Group in excellent shape, drive continuous growth and development, and create greater value – for our employees, customers, shareholders, and society.
Jože Colarič
President of the Management Board and CEO
In this annual report, the Krka Group applies alternative performance measures specified in the European Securities and Markets Authority (ESMA) guidelines. The selected measures additionally disclose the Krka Group and Krka performance. Values are measured in € thousand, except where specifically indicated otherwise. Proportions are presented in percentages or as ratios between two categories.
| Alternative performance measure | Calculation method | Criteria for measure selection |
|---|---|---|
| Earnings before interest, tax, depreciation and amortisation (EBITDA) | Operating profit (EBIT) + Depreciation/Amortisation | Indicates company performance in its core operations and is a close approximation of cash flows from operating activities; The main source of shareholder returns; Allows comparison of business performance regardless of the financing structure and the company’s business capital intensity |
| Operating profit (EBIT) | Operating income – Operating expenses | Indicates performance of company core operations; Allows comparison of business performance regardless of the financing structure |
| Investments | Purchase of property, plant and equipment + Purchase of intangible assets | Indicates assets held for acquisition, maintenance and upgrade of tangible fixed assets for increasing the extent of operations and further development of the Krka Group |
| EBITDA margin | Earnings before interest, tax, depreciation and amortisation (EBITDA)/Revenue | Shows relative performance of the company’s core operations and is used to compare business performance with other companies, excluding the financing structure and capital intensity of the company’s operations |
| EBIT margin | Operating profit (EBIT)/Revenue | Shows the company’s pricing policy and the ability to control operating costs; Indicates relative core operations performance, excluding the financing structure |
| EBT margin | Profit before tax (EBT)/Revenue | Shows relative company performance, including the financial result |
| Net profit margin (ROS) | Net profit/Revenue | Shows overall company performance |
| Return on equity (ROE) | Net profit/((Equity as at 1 Jan + Equity as at 31 Dec)/2) | Shows company efficiency in generating profits based on shareholder’s equity; |
| Calculation method | Subject matter |
|---|---|
| Return on assets (ROA) | Net profit/((Assets as at 1 Jan + Assets as at 31 Dec)/2) |
| Shows efficiency of company’s total asset management; The higher the number, the more efficient company operations | |
| Liabilities/Equity | Current liabilities + Non-current liabilities/Equity |
| Indicates debt-to-equity ratio; Is an important metric for monitoring company capital adequacy and can be used to assess the extent of company reliance on external debt financing | |
| R\&D expenses/Revenue | Research and development expenses as a percentage of revenue |
| Shows Krka Group’s development orientation; Is a strategic measure | |
| Gross dividend per share | Dividend per share for the previous period as per the AGM resolution |
| Shows shareholders’ participation in the company’s profit. | |
| Price/Earnings ratio (P/E) | Closing price on the Ljubljana Stock Exchange as at 31 Dec/Earnings per share (EPS) |
| Shows how much investors in the market are willing to pay per €1 of company’s earnings; Estimates the value of the company and its shares in the market | |
| Book value per share | Equity as at 31 Dec/Total number of shares issued |
| Shows the share price arising from the book value of equity | |
| Price/Book value (P/B) | Closing price on the Ljubljana Stock Exchange as at 31 Dec/Book value |
| Compares the company’s share price in the market and its book value at a particular date; Indicates potential share overvaluing or undervaluing | |
| Market capitalisation (year-end) | Closing price on the Ljubljana Stock Exchange as at 31 Dec x Total number of shares issued |
| Indicates the Krka Group market value relative to the company share price on the Ljubljana Stock Exchange | |
| Current ratio | Current assets/Current liabilities |
| Shows company current liquidity and/or ability to settle current liabilities | |
| Quick ratio | (Current assets – Inventories)/Current liabilities |
| Shows company current liquidity and/or ability to settle current liabilities, excluding inventories | |
| Acid test ratio | (Investments + Cash and cash equivalents)/Current liabilities |
| Shows company current liquidity and/or ability to settle current liabilities, including most liquid assets only | |
| Receivables turnover ratio | Net credit sales/Average receivables |
| Measures how many times a year a company collects its average receivables, indicating its liquidity; Quantifies company effectiveness as per trade receivable management; Includes information on the average payment term of all company customers | |
| Dividend payout ratio | Gross dividend per share for the year/Earnings per share from the previous year |
| Shows percentage of net profit paid to shareholders via dividends and not retained by a company to reinvest in core operations or to pay off debt |
| €thousand | 2024 | 2023 | 2022 | 2021 | 2020 |
|---|---|---|---|---|---|
| Revenue | 1,909,544 | 1,806,391 | 1,717,453 | 1,565,802 | 1,534,941 |
| –Of that revenue from contracts with customers (products and services) | 1,899,848 | 1,798,969 | 1,708,542 | 1,560,288 | 1,529,959 |
| Earnings before interest, tax, depreciation and amortisation (EBITDA) | 520,085 | 504,215 | 488,895 | 463,625 | 502,432 |
| Operating profit (EBIT) | 427,572 | 399,621 | 381,211 | 354,788 | 390,744 |
| Profit before tax (EBT) | 419,078 | 367,126 | 433,073 | 362,417 | 338,992 |
| Net profit | 356,202 | 313,732 | 363,662 | 308,150 | 288,949 |
| Non-current assets (year-end) | 1,022,901 | 1,059,267 | 1,125,025 | 1,075,052 | 990,998 |
| Current assets (year-end) | 1,826,120 | 1,705,024 | 1,562,475 | 1,461,936 | 1,244,544 |
| Equity (year-end) | 2,237,784 | 2,181,766 | 2,138,509 | 1,919,085 | 1,751,812 |
| Non-current liabilities (year-end) | 162,662 | 149,218 | 132,130 |
Dividend yield: Gross dividend per share/Share price as at 31 Dec on the Ljubljana Stock Exchange. Shows dividend yield for dividend beneficiaries relative to share market price.
Gearing ratio: (Borrowings + Trade payables + Current liabilities from contracts with customers + Other current liabilities – Cash and cash equivalents)/Equity. Shows equity financing and indicates the financial risk level associated with the company; Indicates the company’s capital adequacy.
| 2024 | 448,575 |
|---|---|
| 2023 | 433,307 |
| 2022 | 416,861 |
| 2021 | 455,229 |
| 2020 | 310,934 |
| 2024 | 184,855 |
|---|---|
| 2023 | 178,582 |
| 2022 | 162,580 |
| 2021 | 154,559 |
| 2020 | 153,447 |
| 2024 | 117,049 |
|---|---|
| 2023 | 131,932 |
| 2022 | 105,974 |
| 2021 | 66,386 |
| 2020 | 76,613 |
| Ratio | 2024 | 2023 | 2022 | 2021 | 2020 |
|---|---|---|---|---|---|
| EBITDA margin | 27.2% | 27.9% | 28.5% | 29.6% | 32.7% |
| EBIT margin | 22.4% | 22.1% | 22.2% | 22.7% | 25.5% |
| EBT margin | 21.9% | 20.3% | 25.2% | 23.1% | 22.1% |
| Net profit margin (ROS) | 18.7% | 17.4% | 21.2% | 19.7% | 18.8% |
| Return on equity (ROE) | 16.1% | 14.5% | 17.9% | 16.8% | 16.9% |
| Return on assets (ROA) | 12.7% | 11.5% | 13.9% | 12.9% | 13.1% |
| Liabilities/Equity | 0.273 | 0.267 | 0.257 | 0.322 | 0.276 |
| R\&D expenses/revenue | 9.7% | 9.9% | 9.5% | 9.9% | 10.0% |
| Year-End | 2024 | 2023 | 2022 | 2021 | 2020 |
|---|---|---|---|---|---|
| Number of Employees | 12,810 | 11,780 | 11,598 | 11,511 | 11,677 |
| Year | 2024 | 2023 | 2022 | 2021 | 2020 |
|---|---|---|---|---|---|
| Average Employees | 11,984 | 11,667 | 11,569 | 11,581 | 11,631 |
The Krka Group consists of the controlling company, Krka, d. d., Novo mesto, a subsidiary in Slovenia, Terme Krka, d. o. o., Novo mesto, and 33 subsidiaries outside Slovenia.
The Krka Group develops, produces, markets, and sells human health products (prescription pharmaceuticals and non-prescription products), animal health products, and health resort and tourist services.
Production takes place in the controlling company in Slovenia and at Krka subsidiaries in the Russian Federation, Poland, Croatia, and Germany. In addition to production, these subsidiaries, apart from Krka-Rus in the Russian Federation, deal with marketing and sales. In China, production takes place in leased production facilities. Other subsidiaries outside Slovenia market and/or sell Krka products, but do not have production capacities.
Terme Krka, d. o. o., Novo mesto provides health resort and tourist services and operates through the following branches: Terme Dolenjske Toplice; Terme Šmarješke Toplice; Hoteli Otočec; and Talaso Strunjan. Terme Krka is also the majority owner of Golf Grad Otočec, d.o. o.
In April 2024, Krka, d. o. o., Novo mesto (Slovenia) and Laurus Labs Ltd. (India) established a company in Hyderabad, India, and the two entities manage the joint venture based on the underlying agreement. Krka and Laurus agreed to subscribe the registered capital gradually. First payment was made in October 2024. Krka holds a 51% stake in the joint venture. The Krka Group accounts for the investment in the joint venture under the equity method.
Krka, d. d., Novo mesto
Registered office: Šmarješka cesta 6, 8501 Novo mesto, Slovenia
Telephone: ++386 7331 21 11
| Year | Total number of shares issued | Earnings per share (EPS) in € | Gross dividend per share in € | Closing price on LJSE at the end of the period in € | Price/Earnings ratio (P/E) | Book value in € | Price/Book value (P/B) | Market capitalisation in €thousand (year-end) |
|---|---|---|---|---|---|---|---|---|
| 2024 | 32,793,448 | 11.60 | 7.50 | 139.00 | 11.99 | 68.24 | 2.04 | 4,558,289 |
| 2023 | 32,793,448 | 10.14 | 6.60 | 110.00 | 10.85 | 66.53 | 1.65 | 3,607,279 |
| 2022 | 32,793,448 | 11.69 | 5.63 | 92.00 | 7.87 | 65.21 | 1.41 | 3,016,997 |
| 2021 | 32,793,448 | 9.92 | 5.00 | 118.00 | 11.90 | 58.52 | 2.02 | 3,869,627 |
| 2020 | 32,793,448 | 9.27 | 4.25 | 91.40 | 9.86 | 53.42 | 1.71 | 2,997,321 |
Website
www.krka.si
Core business
Manufacture of pharmaceutical preparations
Business classification code
21200
Year established
1954
Registration entry
1/00097/00, District Court of Novo mesto
Tax number
82646716
VAT number
SI82646716
Company ID number
5043611000
Share capital
€54,732,264.71
Total number of shares issued
32,793,448 ordinary registered no-par value shares
Abbreviated company names are used in the remainder of this document.
| Russian Federation | KRKA-RUS LLC | |
|---|---|---|
| Russian Federation | KRKA FARMA LLC | |
| Region East Europe | Poland | KRKA - POLSKA Sp. z o.o. |
| Hungary | KRKA Magyarország Kft. | |
| Region Central Europe | KRKA, d. d., Novo mesto | TERME KRKA, d. o. o., Novo mesto |
| Region West Europe | Spain | KRKA FARMACÉUTICA, S.L. |
| Sweden | Krka Sverige AB | |
| Ireland | KRKA PHARMA DUBLIN LIMITED | |
| Portugal | KRKA Farmacêutica, Unipessoal Lda. | |
| Germany | TAD Pharma GmbH | |
| Austria | KRKA Pharma GmbH, Wien | |
| Slovakia | KRKA Slovensko, s.r.o. | |
| Czechia | KRKA ČR, s. r.o. | |
| Croatia | KRKA-FARMA d.o.o. | |
| Serbia | KRKA-FARMA DOO BEOGRAD | |
| North Macedonia | KRKA-FARMA DOOEL Skopje | |
| Region South-East Europe | Romania | KRKA ROMANIA S.R.L. |
| Bosnia and Herzegovina | KRKA FARMA d.o.o., Sarajevo | |
| Lithuania | UAB KRKA Lietuva | |
| Ukraine | KRKA UKRAINE LLC | |
| Latvia | SIA KRKA Latvija | |
| Italy | KRKA FARMACEUTICI MILANO S.R.L. | |
| France | KRKA France Eurlà capital variable | |
| Belgium | KRKA Belgium, SA | |
| Kazakhstan | LLC ‘KRKA Kazakhstan’ |
The chart includes companies operating as at 31 December 2024.
Other subsidiaries outside Slovenia
Production and distribution companies
We made donations to healthcare institutions also to increase the affordability of treatment. On the occasion of our 70th anniversary, we underscored our commitment to the well-being of the youngest members of our community by making donations to the Division of Paediatrics at the University Medical Centre Maribor, the Division of Paediatrics at the University Medical Centre Ljubljana, as well as paediatrics departments in ten other general Slovenian hospitals.
On our anniversary, we supported the symposium Generations of Knowledge for the Health of All held by the Slovenian Medical Association. The event brought together 230 specialists from 30 countries, experts in cardiology, psychiatry, diabetes, pain relief, pharmacy and animal health. The topics focused on comprehensive, high-quality therapies for the most prevalent diseases of our time. Through organising and supporting educational courses, we contribute to one of the United Nations’ 2030 Agenda goals – reducing deaths from noncommunicable diseases by one-third by 2030.
We integrate sustainability and ecological standards into technological procedures for chemical synthesis in API development and research. One of our latest approaches promotes the adoption of artificial intelligence and machine learning.
We extended our fleet with our first heavy-duty electric truck, which we use to transport our products throughout Slovenia. We set a new standard and delivered on our long-term commitment to developing sustainable mobility.
At the 18th traditional meeting with Krka’s sponsorship recipients, the 2023 Talent-of-the-Year Awards were announced. Three outstanding young individuals received certificates of recognition for their achievements in sports and culture.
As part of our social responsibility initiative, Krka’s Week of Charity and Volunteering, employees from 21 countries participated for the 11th consecutive year, promoting volunteerism, mutual assistance, and intergenerational connection.
For the ninth consecutive year, we participated in the European Mobility Week with our Krka Car-Free Day campaign, reaffirming our commitment to our care for the planet. Employees in 13 countries where we operate subsidiaries commuted to work using sustainable means of transport.
To commemorate our 70th anniversary, we added a new inscription to the base of Krka Girl with a Growing Book statue, located in front of our state-of-the-art pharmaceutical production facilities in Novomesto, Slovenia. Additionally, we published a comprehensive monograph entitled 70 Years: Living a Healthy Life.
We upheld our unique and long-standing tradition of Krka Prizes by awarding secondary school, undergraduate, and graduate-level prizes for the 54th consecutive time. Recipients also had the opportunity to present their papers at a scientific symposium.
At the 2024 SCS Annual Meeting, the Slovenian Chemical Society introduced awards and certificates of recognition, honouring outstanding achievements in science, education, and the economy. Krka’s scientist Dr Silvo Zupančič was honoured with an award for his long-standing contributions to the development of the chemical industry in Slovenia and his role as a mentor and leader in the industry.
The Municipality of Novomesto honoured Prof. Dr Franc Vrečer, longtime Assistant Director of Pharmaceutical R&D, for his significant and enduring contributions to scientific research and innovation.
On International Volunteer Day, we presented the Volunteer of the Year Award and recognised Krka employees for their dedication as blood donors.
Krka’s Culture and Arts Society also continued fostering cultural and artistic activities in 2024.
The organisational climate survey of the Krka Group conducted at the end of 2023 revealed that 69.8% of employees take pride in working at Krka, while an impressive 77.3% demonstrate high engagement. Job content and close collaboration within a creative and dynamic work environment were the highest-rated aspects.
Our top sustainable priorities are product quality and patient safety. Krka experts explored relevant GMP and GDP topics at a three-day international QA conference.
At the 21st International Regulatory and Pharmacovigilance Conference, employees from over 30 countries gained insights into pharmacovigilance and marketing regulatory matters. Outstanding regulatory affairs employees were recognised with awards, certificates of recognition, and commendations.
The 26th Marketing and Sales Conference brought together 186 managers from 39 countries, presenting the latest trends in marketing and sales.
Top-performing marketing and sales employees from 29 countries received Marketing Awards.
More than 250 participants from 35 countries gathered at the Brand Managers’ Meeting, gaining insights into the future of multichannel marketing.
Last year, we held 18 worker assemblies, where senior managers gave employees key updates on business operations.
The traditional Krka Awards Day highlighted the shared mission and values that unite Krka employees worldwide, regardless of linguistic and cultural differences. Plaques were awarded to long-serving staff members, top employees, top managers, and colleagues who excelled in innovation.
We hosted the 20th Krka International Leadership School, a prestigious training course for Krka Group managers. To date, 437 employees from 37 countries have completed the course, including 24 employees from 15 countries last year. Additionally, the 19th cohort of Krka employees graduated from the Krka Operational Leadership School.
We presented special recognition certificates to our top-performing employees from our subsidiaries abroad who achieved Elite Club membership for three consecutive times.
We recognised and thanked our colleagues and organisational units for their innovative efforts in submitting the best practical proposals and improvements, contributing to the company’s progress. Most of these improvements have been successfully implemented, with many adopted across the Krka Group.
Since 2000, we have been the only company in Slovenia to offer six national vocational qualification programmes for the pharmaceutical industry. In 2024, 198 Krka employees completed various programmes, gaining the skills needed to manage highly automated work processes and operate computer-controlled technological systems more easily.
Last year, we continued our tradition of hosting an annual event for our recently retired colleagues, where the company management thanked them for their loyalty and contributions to Krka’s success.
The two events after the accounting period had no impact on the 2024 financial statements.
Krka and the Indian company Laurus Labs Ltd. (hereinafter Laurus) established a joint venture, Krka Pharma Pvt. Ltd., headquartered in Hyderabad, India, in April 2024. Krka holds a 51% and Laurus a 49% stake in the joint venture. At the beginning of October 2024, Krka paid in €2.5 million of initial capital, and on 10 March 2025 the second instalment of registered capital totalling €9,233,550 or 867,000 thousand Indian rupees.
The Company repurchased 87,928 treasury shares between 1 January 2025 and 14 March 2025 and thus held 2,195,265 treasury shares at the end of this period, accounting for 6.69% of total shares.
Krka employs a two-tier corporate governance system. The Management Board runs the Company and is overseen by the Supervisory Board. Corporate governance is based on the legislation of the Republic of Slovenia, Slovenian and international good practice, and Krka’s internal rules.
Under the Slovenian Companies Act (ZGD-1), the Company’s highest body is the Annual General Meeting (AGM). The AGM is convened when it serves the Company’s interests or when required under the Companies Act (ZGD-1) or Krka’s Articles of Association (Article 6.20).
It is where shareholders directly participate in the Company’s governance, and all fundamental and statutory decisions are taken. Each share, except for treasury shares, represents one vote at the AGM. Krka has one share class only: ordinary no-par value shares.
Krka’s AGM makes decisions by a majority of votes cast, unless otherwise specified by law or the Articles of Association. In accordance with Article 6.24 of the Articles of Association, a three-quarters majority is required for decisions on:
The Management Board calls the regular AGM once a year, at least 30 days before the due date. Upon request, all the materials for each AGM can be viewed at the Company’s registered office starting from the notice date.
All shareholders entered in the shareholder register as at the record date, which is published in the notice, have the right to attend and vote at the AGM. The same applies to their representatives and proxies.
The text referred to by the ‘Sustainability statement’ is highlighted in green in the ‘Corporate governance statement’.
At the AGM, the Management Board provides shareholders with all information required to assess the agenda, taking into account all legal or other information disclosure restrictions.
In the 2024 AGM notice, per Item 8.2 of the Corporate Governance Code for Listed Companies in force, the Company requested all major shareholders to publicly disclose their investment policies in respect of their shareholdings in the Company, in particular their voting policy, the type and frequency of their engagement in the Company’s governance, and the flow of their communication with the Company’s managerial and supervisory bodies.
At the 30th AGM of 11 July 2024, shareholders:
According to the 2025 financial calendar, the regular AGM is set for 10 July. The Company must give 30 days clear notice before the AGM is held and publish it on the AJPES website, in the Company’s printed or online publication if it is due for publication at the time of the notice and on the Company’s website. The notice must also comply with the Financial Instruments Market Act.
Further information on shareholders and voting rights is available under ‘Investor and share information’. As at 31 December 2024, there were no restrictions on the transfer or voting rights of Krka shares. No share carried any special control rights.
The Supervisory Board supervises the Company’s operations and business management and selects and appoints members to the Management Board. The body meets at least four times a year. Under the provisions of the Articles of Association, the Supervisory Board pre-approves the annual business and financial plan and the strategy for adoption by the Management Board. It also carries out other tasks in accordance with the Companies Act. It primarily approves (a) The appointment, removal, and remuneration of the Head of Internal Audit; (b) The act regulating the purpose, meaning, and duties of Internal Audit; and (c) The annual and multi-year plans of Internal Audit. It is also briefed about the annual Internal Audit report. The President of the Supervisory Board concludes contracts with the external auditor. The Management Board can only invite shareholders in the AGM notice to attend and vote at the AGM even if they are not physically present at the meeting if permission is granted by the Supervisory Board (Item 6.21 of the Articles of Association).
The Articles of Association stipulate the composition of the Supervisory Board. The Supervisory Board has nine members: six are elected by the AGM, and the Company’s Works Council elects three employee representatives.
The President of the Supervisory Board is always elected from the AGM-appointed members. Members are appointed for a five-year term and can be reappointed.
held on 9 July 2020. Another two shareholder representatives sit on the Supervisory Board: Luka Cerar elected by the AGM on 6 July 2023, and Mojca Osolnik Videmšek elected by the AGM on 11 July 2024. The President of the Supervisory Board is Jože Mermal. His deputies are Matej Lahovnik, a shareholder representative, and Mateja Vrečer, an employee representative. If the President of the Supervisory Board is absent, the shareholder representative replaces him, and if the latter is also absent, the employee representative replaces him in turn.
The role of the administrative, management and supervisory bodies (21(b) representation of employees and other workers)
The Supervisory Board’s performance complies with legislation, recommendations of professional associations, primarily the Slovenian Directors’ Association, and other good practice recommendations, particularly the Slovenian Corporate Governance Code.
Supervisory Board members’ remuneration, reimbursement, and other benefits are not directly linked to the Company’s performance and are disclosed in the ‘Financial report’ under the ‘Notes to the consolidated financial statements’ (‘30. Related party transactions’) and in the Report on Remuneration of Management and Supervisory Board members of Krka, d. d., Novo mesto, which is reviewed by the AGM. In addition to attendance fees, members receive fixed amounts for exercising their functions and additional payments, i.e. for membership on committees, chairing the Supervisory Board or acting as a deputy to its president, presiding committees, and for special undertakings. All remuneration amounts were fixed by resolutions passed at the 29th regular AGM in 2023.
Supervisory Board members report to the Company and competent institutions on any acquisitions or disposals of Company shares, and Krka makes the information public. Please find the disclosure on how many Krka shares Supervisory Board members hold in the ‘Financial report’ under the ‘Notes to the consolidated financial statements’ (‘30. Related party transactions’).
In addition to the Companies Act, the Rules of Procedure of the Supervisory Board govern any potential conflict of interest of the members. Supervisory Board members must consider the Company’s objectives when discharging their duties and accordingly subordinate any personal interests or interests of third parties. All members were asked to complete a conflict of interest questionnaire. The questionnaire is available on the Krka website. The Rules of Procedure of the Supervisory Board outline steps to be taken by members in case of a conflict of interest. The document is available at http://www.krka.biz/en/for-investors/documents/corporate-governance-documents/. A conflict of interest can constitute an impediment to voting. Any non-temporary material conflict of interest may be grounds for terminating a member’s term of office and is assessed when drafting the proposal for that person’s election.
The work of the Supervisory Board and related committees is detailed in ‘2024 Supervisory Board report’, published on SEOnet (http://seonet.ljse.si) of the Ljubljana Stock Exchange, ESPI of the Warsaw Stock Exchange, and Krka’s webpages together with the 2024 Annual Report.
Jože Mermal (born 1954) comes from Ljubljana and holds a university degree in economics. Since 2019, when BTC introduced the one-tier management system, Mermal has chaired the company’s management board. He had successfully managed BTC for over 26 years before that, having worked creatively in many senior managerial positions since 1978. He was the driving force behind the project to restructure and transform public warehouses into a thriving, dynamic, and rapidly expanding company that has also become one of Europe’s largest business, shopping, entertainment, recreation, culture, and innovation centres: BTC City. As the founder and strategist of BTC, he has been supporting investments in development to reach the company’s long-term goal: to make BTC an open company for future generations. Under his stewardship, the company has forged links with long-term business partners through various exploits, creating a unique business ecosystem and seeking new opportunities and challenges in an age of mass society, globalisation, innovation, and sustainable development.
In partnership with the Municipality of Ljubljana, he has been involved in setting up a 230 hectare urban regeneration project for the city of Ljubljana, the Šmartinska District Partnership. Crystal Palace, the Radisson Blu Plaza Hotel, and Ikea have been constructed as part of the project. He has also collaborated with the Municipality of Ljubljana in setting up the Intermodal Logistic Terminal (ILT) Ljubljana.
Under his management, ABC Accelerator was established in 2015. Its principal function is the development of a start-up business ecosystem. He also holds key managerial roles in various sports organisations and at international sporting events.
Under his management, BTC has received a plethora of awards and prizes for various community projects. He participates in cultural, sporting, educational, humanitarian, and scientific events, which he supports and is involved in. He has received several awards for his work, including Manager of the Year in 1997 and the Primus Award for Excellence in Communication in 2001 by the Slovenian Public Relations Society. He is a keen advocate of culture and was named Cultural Patron of the Year in 2011. His visionary management and creativity at BTC earned him the Vision Manager Award in 2012, which is conferred by public relations experts from south-eastern Europe. In 2013, the Municipality of Ljubljana conferred the Marjan Rožanc Award on Mermal for sporting achievements. The Chamber of Commerce and Industry of Slovenia awarded him for exceptional business and entrepreneurial achievements in the category of large companies in 2013. Under Mermal’s management, BTC has become the first – and, to this date, the only – Slovenian company listed on the London Stock Exchange. In 2015, he received a gold plaque from the Managers’ Association of Slovenia for more than two decades of support. The highest managerial lifetime achievement award followed it, the Best Manager of South-Eastern Europe 2016 award, which is bestowed by the Independent Agency for the Selection and Promotion of Managers. Mermal was awarded the title of a 2017 honorary citizen of Ljubljana, the highest honour bestowed by the Municipality of Ljubljana, for his contribution to the renown, significance, and development of the municipality and its inter-city and international relations. At the awards for best managers and companies from central and south-eastern Europe, he received the Best Manager and Best Company in Europe lifetime achievement award in 2019. In 2020, the Management Board of the Managers’ Association of Slovenia awarded Mermal the Lifetime Achievement Award in Management. In 2024, he was honoured with two lifetime achievement awards. At the Fourth World Congress of Entrepreneurs in Montenegro, he was presented with the Stvaratelji za stoljeća 2023 grand award and recognition for his lifetime entrepreneurial accomplishments. He also received the SPORTO award for his exceptional promotion of sports brands.
Government of the Republic of Slovenia. He led the corporate governance and investment negotiation teams during Slovenia’s OECD membership talks. He is a member of the Strategic Council for Macroeconomic Issues of the Government of the Republic of Slovenia.
He has been involved in many scientific project teams, researching the behaviour of enterprises and financial institutions in transition; Slovenian economic development strategy; successful competitive strategies of Slovenian and Croatian companies; company acquisitions in economies in transition; and market regulations post-EU accession. He has authored or co-authored many papers on strategic management and mergers and acquisitions published in scientific and research journals and at conferences. He has co-authored a scientific monograph and authored or co-authored two university textbooks.
President of the Human Resource Committee
Boris Žnidarič holds a PhD in social sciences and a master’s degree in law. Up to his retirement, he served on the management board of Kapitalska družba, d. d., Ljubljana, a company that manages additional funds for pension and disability insurance. Before that, he held various roles at the Triglav Group insurance company. He was assistant to the president of the management board of Zavarovalnica Triglav, where, in addition to leading and directing heads of organisational units, he was also responsible for strategic human resource management at subsidiaries. He was on the management board of Triglav Osiguranje in Zagreb, Croatia. He also managed the Celje regional unit of Zavarovalnica Triglav, and led the central insurance fraud prevention and detection department. Before taking up that role, he was an adviser to a management board member for strategic human resource management in the Triglav Group, and an assistant director for legal, human resources, and general affairs at the Ljubljana unit. He holds a certificate of professional competence for supervisory board membership. In addition to his diverse career in insurance, he is also a university lecturer.
President of the Audit Committee
Mojca Osolnik Videmšek (born 1966) holds a university degree in economics. She sits on the management board of Gorenjska banka, d. d., a bank, and is responsible for risk management. A bank employee since 2014, she sat on the management board from 2014 until 2019, was a member of the management team of the bank’s subsidiary GB Leasing, d. o. o. from 2019 until 2022, then again sat on the management board from 2022.
Before taking up employment with Gorenjska banka, she was responsible for various challenging areas of work at another Slovenian bank, NLB, d. d., primarily concerning corporate governance at the NLB Group. As director of Capital Investments Management and Control, she sat on several supervisory boards and audit committees of subsidiaries in Slovenia and abroad. She was also director of the office of the management board and secretary general at NLB. She has additionally acquired expertise through executive roles in public administration. From September 1994 until April 1999, she worked as head of the Prime Minister’s Office. Between 2001 and 2003, she was director of the Administrative Office of the Prime Minister of the Republic of Slovenia and, for a brief spell in 2000, Secretary General at the Ministry of Foreign Affairs. She holds a certificate from the Slovenian Directors’ Association. She sat on the management board of the Slovenian Directors’ Association for three terms of office.
Julijana Kristl holds a PhD in pharmaceutical sciences and worked at the Faculty of Pharmacy at the University of Ljubljana (1977–2021). She upskilled through programmes at the University of Geneva and the University of Lyon, as well as within the pharmaceutical industry.
Her scientific career started in the area of pharmaceutical technology. Her greatest achievements include sustainable development and deploying pharmaceutical nanotechnology in Slovenia and beyond. Her work initially focused on developing and evaluating API nanodelivery systems that support innovative modes and new treatment mechanisms. Other notable achievements include lipid and polymer nanostructure (various nanoparticles and nanofibres) research and development, the discovery of mechanisms for increasing active ingredient solubility and bioavailability, and understanding the correlation between the structural composition and the real-time cell response on contact with them. Owing to her achievements, she is a pharmaceutical nanotechnologist of global renown. In 2021, the Ministry of Education, Science and Sport of the Republic of Slovenia awarded Kristl the Zois Lifetime Achievement Award. She was awarded emeritus status by the University of Ljubljana in 2022 for her significant contribution to the development of pharmaceutical science and dedicated pedagogical and scientific work.
Throughout her career, she held many managerial posts, serving as Vice-Dean, Head of the Chair of Pharmaceutical Technology, Dean of the Faculty of Pharmacy, and as Vice-Rector at the University of Ljubljana (two terms). She is an active member of many prominent commissions and committees at state and university levels. Since 2021, she has actively participated in the council of the Slovenian Quality Assurance Agency for Higher Education, Slovenian Directors’ Association, Slovenian Pharmaceutical Society, and the Outstanding Achievements Awards and Recognition Committee of the Republic of Slovenia.
Professor emeritus, she is committed to research, gaining and sharing know-how with students and the scientific and business communities. She sets high professional goals, is future-focused, and acts to benefit the community. Her knowledge, personal skills, independence, and autonomy are solid foundations for a successful tenure on the Supervisory Board of Krka.
Luka Cerar (born 1976) holds a master’s degree in international finance. He is the CFO for the European region at Albaugh TKI, d. o. o. He is accountable for finance, treasury, controlling, strategic planning, reporting, IT, and taxation in Europe, the Near East, and Africa, where fifteen of Albaugh’s subsidiaries and three manufacturing plants operate. Albaugh is one of the global leaders in the production and sale of post-patent crop protection products and plants.
Before joining Albaugh, Cerar worked as the finance director at Atlantic Grupa in Slovenia. He gained ample experience in the pharmaceutical industry. Between 2001 and 2019, he completed many demanding strategic and financial assignments at Novartis and Sandoz, also having worked abroad for 12 years in Austria, Germany, Denmark, and Croatia. His most recent posts in Novartis’ subsidiary in Slovenia were those of the finance director and director. He received the 2018 Team of the Year award from Novartis Slovenia and an award from Novartis for improving performance analyses in 2016. Sandoz awarded him in 2013 for the best practice in finance.
Cerar graduated in economics from the Faculty of Economics in Ljubljana in 2000. He continued studies in the UK and France, at Westminster Business School and SKEMA Business School, respectively, where he earned his master’s degree in international finance in 2004. In 2007, Cerar earned the Novartis Business Diploma from Harvard Business School. He holds a certificate of professional competence for supervisory board membership of the Slovenian Directors’ Association.
Dr Mateja Vrečer has been a Krka employee since 1990. She started as a pharmaceutical engineering graduate, passed the pharmaceutical engineering certification examination, followed up with a master’s degree, and then a doctorate in pharmaceutical sciences. She started out in Research and Development on registrations, managing product registration and product launch campaigns in Slovenia. In 1997, she was appointed Deputy Director of Quality Management, and in March 2007, she took up the role of Head of International Quality Assurance. She managed customer complaints, contractors, supplier verifications and approvals, and headed inspections and partner audits. In September 2011, she accepted the position of Director of Quality Management.
In 2023, she received the Boris Andrijanič Award for Remarkable Achievements.
She has held several terms of office as an employee representative on the Krka Supervisory Board. The Works Council appointed Vrečer an employee representative for another term of office, commencing on 21 June 2024.
Dr Mari Božič, born in 1964, is Assistant Head of Pharmaceutical Development. She has been with Krka since 1981. Holding a degree in economics, she has specialised in business economics, completed postgraduate studies in management, and earned a doctoral degree in quality management. She built on her secondary school knowledge of pharmacy and chemistry through work experience in various pharmaceutical production, research, and development departments. In 2004, the Slovenian Institute of Quality and Metrology (SIQ) certified Božič as an internal auditor for the quality management system.
Bolstered by her work experience, her expertise was instrumental in establishing the quality system at the Pharmaceutical Development Pilot Plant in 2002. She took over its management in 2007 and has successfully performed her duties for nearly 17 years. During the expansion of development facilities, she joined several project teams, with the construction of the Pharmaceutical Development Pilot Plant in 2018 being the largest project.
Since 2005, she has been a member of the Krka Works Council and has served as its President since 2023. She is also a member of the Association of Works Councils of Slovenia. Continuously upskilling, Božič is actively involved in economic democracy, with a primary focus on employee relations. She participates in conferences and publishes articles in both domestic and foreign publications. She has co-authored a scientific monograph. In October 2024, she was elected president of the Strategic Council of the Faculty of Organizational Sciences for a four-year term of office.
The Works Council appointed Božič as an employee representative to the Supervisory Board for the period from 21 June 2024 to 21 June 2029. She holds a Slovenian Directors’ Association certificate, evidencing her qualifications for sitting on a supervisory or management board.
Tomaž Sever was born in 1967. After graduating as a mechanical engineer, he earned a master’s in management and organisational sciences. He has been employed at Krka since 1995. He is Deputy Director of Sales and Director of Region Central Europe, entrusted with market research; establishing and expanding Krka’s presence in individual markets; specifying the product range; recommending pricing strategies for individual markets; taking part in the preparation of sales campaigns; designing, developing, and managing distribution channels; and participating in the sales network creation abroad. Before joining Krka, he worked for IBM Slovenia d. o. o. from 1992 to 1995, first as an information systems sales representative and later managing information system installation projects.
Sever has been an employee representative on the Krka Supervisory Board for four terms. The Works Council elected him to the Supervisory Board as an employee representative for another term of office that commenced on 21 June 2024.
Independent Accounting and Audit Expert, Member of the Audit Committee
Certified auditor Borut Šterbenc (born 1978 in Ljubljana) holds a university degree in economics. He graduated from the Faculty of Economics, University of Ljubljana. On 1 January 2020, he assumed chairmanship of the management board of Kolpa, d. d., Metlika. Up to 2011, he was a project manager at KPMG, where he planned, led, and conducted complex audits in many Slovenian companies, including Krka, Intereuropa, Sava, NEK, and Lama. Šterbenc is also a supervisory board member at Pokojninska družba A, d. d. and an experienced rapporteur to governance and supervisory bodies. He is a certified auditor registered with the Agencija za nadzor nad revidiranjem (Agency for Public Oversight of Auditing). He also holds a certificate of professional competence for supervisory board membership issued by the Slovenian Directors’ Association. He is fluent in English, Croatian, and Russian.
The Management Board’s primary duties are to:
The Management Board has five members:
The President and other members of the Management Board of Krka were not members of any governance or supervisory bodies outside the Krka Group in 2024.
The term of office of Management Board members is six years. Members can be reappointed. The candidacy procedure and selection of the Management Board members took place in 2021, when the Supervisory Board appointed the Management Board for a term of office commencing on 1 January 2022.
The Rules of Procedure of the Management Board set out the operational functions and allocation of responsibilities within the Management Board. The body’s operating approach is to coordinate opinions and make decisions by consensus. Management Board members also have executive management duties in line with the Rules of Organisation and the Rules of Procedure of the Management Board. Every member is responsible for a certain number of organisational units, which facilitates direct cooperation between the Management Board and directors of organisational units.
The committees bring together Management Board members, managerial staff, and experts from individual sectors in Krka. They prepare business policies and strategic guidelines for individual areas and also have some decision-making responsibilities for implementing annual plans. Certain committees also have a risk management remit.
Remuneration, reimbursements, and other benefits for Management Board members are established in accordance with the Remuneration Policy for Management and Supervisory Bodies (Article 294a of the Companies Act) and detailed in individual work contracts between the Supervisory Board and each Management Board member, aligning with the aforementioned remuneration policy. In compliance with the Companies Act, a consultative resolution at the AGM decides the remuneration policy for management and supervisory bodies.
In 2024, payments to Management Board members were made in cash. The data are disclosed in the ‘Financial report’ under the ‘Notes to the consolidated financial statements’ (‘30. Related party transactions’) and in the Report on Remuneration of Management and Supervisory Board members of Krka, d. d., Novo mesto, which is reviewed by the AGM (Article 294b of the Companies Act).
Management Board members and their related parties report to the Company and the competent institutions on any acquisition or disposal of the Company’s or related parties’ shares. Krka makes this information public.
The obligations of Management Board members concerning potential conflicts of interest are regulated by the Companies Act, guided by the Rules of Procedure of the Management Board, which adhere to best practices, notably outlined in the Corporate Governance Code for Listed Companies. In accordance with the Rules of Procedure of the Management Board, members are required to demonstrate unwavering loyalty to the Company. They must disclose any conflict of interest to the Supervisory and Management Boards immediately but no later than three days after it arises. Throughout their tenure, they are obliged to adhere to regulations prohibiting anticompetitive practices. Under the Rules of Procedure, they can accept seats on supervisory bodies of companies outside the Krka Group only after notifying and obtaining approval from the Supervisory Board of Krka. In 2024, no member of the Management Board of Krka was a member of a supervisory body of any company outside the Krka Group. The existence of any conflict of interest is assessed prior to their nomination.
As regards the Management Board’s powers, the shareholders adopted a resolution at the 29th AGM of 6 July 2023, authorising the Management Board to acquire treasury shares over a 36-month period provided that total treasury shares, including new purchases and shares already held, do not exceed 10% of total share capital. The Company informed the public about the treasury share repurchase programme on the web portal of the Ljubljana Stock Exchange SEOnet (http://seonet.ljse.si).
President of the Management Board and CEO
Jože Colarič (born 1955 in Brežice, Slovenia) completed his secondary education at Gimnazija Novo mesto (Slovenia), then continued his studies at the Faculty of Economics in Ljubljana graduating in 1979.
He has been employed at Krka since 1982. He started in the Finance Sector, where he initially headed Foreign Currency Payments, and then won promotion to Assistant Director. In 1989, he began managing the Exports Department within the Import-Export Sector. Two years later, he became Deputy Director of Import-Export.
Early in 1993, Colarič was appointed Deputy Chief Executive for Marketing and Finance. In September of the same year, he also assumed management of the Marketing-and-Sales Sector.
In 1997, he was appointed to the Management Board. The following year, the Supervisory Board appointed him Deputy President of the Management Board, and in 2002, endorsed him as a future president of the Management Board, making him responsible for nominating candidates for the new Management Board team.
At their meeting of 12 July 2004, the Supervisory Board appointed Colarič President of the Management Board and Chief Executive Officer. His five-year term of office began on 1 January 2005. At their meeting of 21 January 2009, the Supervisory Board appointed him for another six-year term of office commencing on 1 January 2010. Under his management, Krka has developed into a leading global generic pharmaceutical company, establishing a strong foundation for future expansion. Colarič’s approach is driven by Krka’s in-house expertise, continuous product development, annual investments, talent acquisition, and regular dividend payments. In 2015, the Supervisory Board unanimously appointed him President of the Management Board and CEO for a new six-year term of office commencing on 1 January 2016. When that term of office ended, the Supervisory Board appointed him President of the Management Board and CEO for another six-year term of office commencing on 1 January 2022. The Supervisory Board unanimously approved the unchanged Management Board put forward by Colarič and the Worker Director proposed by the Works Council for the 2022–2027 term of office. The Management Board composition remains unchanged for the 2022 to 2027 term of office.
Member of the Management Board and Director of Pharmaceutical R&D and Production
Aleš Rotar (born 1960 in Zadar, Croatia) graduated in pharmacy from the Ljubljana Faculty of Natural Sciences and Engineering in 1984, and earned a master’s degree seven years later. In 1993, he received his MBA from IEDC, Brdo. He earned his doctorate from the Faculty of Pharmacy, Ljubljana, in 2000.
He started working at Krka in the Stability Department in 1984. In 1991, he was appointed Head of Pharmaceutical Technology and two years later Head of Pharmaceutical Development within Research and Development. In 1998, he was appointed Deputy Director; in 1999, he was appointed Director of Research and Development.
He was appointed to the Management Board in 2001. He began his second term on 31 July 2002 and was reappointed from 31 July 2007 to 31 December 2009. Rotar has been Director of Research and Development since 2002. At their meeting of 29 July 2009, the Supervisory Board reappointed him to the Management Board for a further six-year term of office starting on 1 January 2010. Rotar has played a key role in advancing Krka’s in-house research and development, contributing significantly to knowledge expansion and the establishment of business functions. Recognising his strong performance, in November 2015, the Supervisory Board unanimously appointed Rotar to the Management Board for a new term of office from 2016 to 2021, following a nomination by Colarič. During that term, he successfully integrated development and production processes into Pharmaceutical R&D and Production, one of Krka’s largest organisational units. Synergies between the experts from development and production helped enhance technology transfer and product life cycle management, leading to higher production output. During his terms of office, Krka almost doubled product launches.
Member of the Management Board and Director of API R&D, Production and Supply Chain
Vinko Zupančič (born 1971 in Novo mesto, Slovenia) finished his secondary education at Gimnazija Novo mesto. He graduated from the Faculty of Pharmacy in Ljubljana in 1996, earning a master’s degree in pharmacy. In 1998, he passed a certification examination in pharmacy and in 2010, earned a doctorate from the Faculty of Pharmacy.
He joined Krka in 1997 as a Warehousing and Transport of Product Supply trainee. In 1998, he became a warehouse systems specialist and then a senior warehouse systems specialist. In 2000, he assumed the role of assistant to the Head of Warehouse and Transport Services. In 2002, he became Deputy Head of Supply Chain in Product Supply. Commencing on 1 February 2004, Zupančič took up his appointment as Director at Krka’s representative office in Bangalore, India. He returned to Krka in Slovenia on 1 July 2005 as Head of Supply Chain in Product Supply. He was appointed Deputy Director of Product Supply on 1 December 2008, and Director of Product Supply on 1 January 2010.
On 29 July 2009, the Supervisory Board appointed him to the Management Board for a six-year term commencing on 1 January 2010. Krka’s significant competitive edge lies in the fact that we manufacture most of the APIs and raw materials we require, enhancing product economics and cutting response time. Zupančič has been integral to the success of this strategy. Following his 2015 nomination by Colarič, the Supervisory Board unanimously appointed him to the Management Board for a term of office from 2016 to 2021. He successfully managed raw material development, production, and the supply chain during that term. He played a key role in supply chain management regarding finished products, from improving raw material economics to process optimisation. He is also credited with continuously streamlining warehousing capacities and optimising transportation by road and other modes of transport.
Following his 2021 nomination by Colarič, the Supervisory Board unanimously appointed him to the Management Board for another six-year term of office commencing on 1 January 2022.
Member of the Management Board
David Bratož (born 1976 in Novo mesto, Slovenia) holds a university degree in economics. Having finished his secondary education at Gimnazija Novo mesto, he continued his studies at the Faculty of Economics in Ljubljana. He graduated in 2000, specialising in finance.
Bratož began his career at Krka in 2001 in the Finance department, where he managed several major projects. In 2003, he began working in Sales, Region Central Europe, primarily in charge of the Polish market. Owing to his strong performance, he was appointed Director of Krka - Polska in 2007, where he managed marketing, sales, production, and distribution operations. Two years later, he was appointed President of the Board of Directors.
Bratož and his team worked together to make Krka - Polska one of the largest and most successful Krka subsidiaries. During his tenure in Poland, product sales and production volume doubled, earning numerous awards for both him and Krka - Polska.
Bratož has extensive knowledge across all business functions of a large corporation. Following his 2015 nomination by Colarič, the Supervisory Board unanimously appointed him to the Management Board for his first term of office from 2016 to 2021. He contributed to the renewal of our development strategy. He was also responsible for overseeing finance, the economics of international and domestic business operations, Krka Group controlling, business intelligence, and the development of business informatics. He spearheaded the implementation of business compliance, corporate integrity, and personal data protection at the Company. During his term of office, Krka accelerated digitalisation, adopted cloud technologies, and enhanced information security. He leads the expert team tasked with enhancing sustainable management at the Company. As a member of the Management Board, Bratož liaises closely with the Works Council and the two trade unions. He is also responsible for employee recreation, work-time meals, housing matters, and Krka’s societies.
He sits on the supervisory board of the Chamber of Commerce and Industry of Slovenia. Following his 2021 nomination by Colarič, the Supervisory Board unanimously appointed him to the Management Board for another six-year term of office commencing on 1 January 2022.
Member of the Management Board – Worker Director; Deputy Director of Pharmaceutical Production
Milena Kastelic (born 1968 in Novo mesto) holds a degree in food technology. After finishing her secondary education at Gimnazija Novo mesto in 1986, she enrolled at the Biotechnical Faculty at the University of Ljubljana. In 1991, she won the Prešeren Award for her undergraduate diploma thesis, ‘Evaluation of glucoamylase activity in yeast Saccharomyces diastaticus’. In 1993, she completed training in work design at the REFA Association in Germany.
She started her career at Krka in 1992 and has been a valuable staff member ever since. Over nearly three decades, her professional journey has been closely tied to herbs, the production of non-prescription products, and prescription pharmaceuticals for human use and animal health. She completed her traineeship in the Auxiliary Medicinal Products and Herbs Programme with an assignment on the technology of drying plant-based raw materials. She worked as a production technologist for five years. In 1996, she became the Head of the Plant for the Production of Herbal Medicines, today’s Bršljin Department, which she successfully managed until April 2018. From January 2016 until July 2021, Kastelic also headed the Semi-Solid, Liquid and Other Products Department. In July 2021, she took up the position of Deputy Director of Pharmaceutical Production. She also delivers employee training.
As Krka’s internal auditor for 15 years, she has played a key role in enhancing business processes at the Company. This role enabled her to gain insights into the operations of various organisational units, the significance of their close collaboration, and the outcomes of their collective efforts.
In 2015, the Works Council nominated her for the role of Worker Director. The Supervisory Board appointed her to the Management Board as Worker Director for her first term of office from 2016 to 2021. Kastelic is well-trusted by the employees, which led to her reappointment as Worker Director by the Works Council in 2021. Consequently, the Supervisory Board unanimously appointed her to the Management Board as Worker Director for a further six-year term of office commencing on 1 January 2022.
Since 2020, Krka has adhered to its Diversity Policy for Management and Supervisory Bodies, further strengthening it in 2024 with the introduction of the Diversity, Equity, and Inclusion Policy for the Krka Group.
At the end of 2024, the Company’s five-member Management Board consisted of one female and four male members, while the nine-member Supervisory Board included four female and five male members. In total, there were five females and nine males on the Management and Supervisory Boards. In 2024, women accounted for 44.4% of the Supervisory Board structure, constituting 35.7% of the Management and Supervisory Boards.
In 2024, the gender representation, calculated as an average ratio of females to males, was 0.25 for the Management Board and 0.64 for the Supervisory Board.
At the end of 2024, the Directors’ Committee comprised 12 men (57.1%) and 9 women (42.9%). At the end of 2024, Krka’s subsidiaries and representative offices were led by 21 female directors (39.6%) and 32 male directors (60.4%).
Key areas of the Diversity Policy for Management and Supervisory Bodies of Krka are gender, age, and qualification profile diversity. The policy pursues a balanced gender structure, suitable interdisciplinarity and age structure, allowing for the transfer of experiences and knowledge. The policy primarily addresses the diversity of the Management and Supervisory Boards.
The Diversity, Equity and Inclusion Policy of the Krka Group applies to all Krka employees and serves as the basis for further reinforcing our expectations of business partners throughout the entire value chain.
Krka has always ensured equal opportunities for its employees, irrespective of gender, race, colour, age, health status or disability, religious or political beliefs, any other belief, trade union affiliation, national or social origin, family status, financial standing, sexual orientation, or any other personal particulars.
The role of the administrative, management and supervisory bodies (21(a) the number of executive and non-executive members; 21(d) percentage by gender and gender representation)
The Diversity Policy for Management and Supervisory Bodies of Krka is monitored by: (a) Human Resource Committee of the Supervisory Board; (b) Supervisory Board; (c) Management Board; (d) Works Council; (e) Any committees involved in procedures for selecting members to management and supervisory bodies; and (f) Human Resources of Krka.
Krka integrates the principles of the Diversity, Equity and Inclusion Policy of the Krka Group into its strategy, activities, and values, ensuring the necessary resources and support for its implementation, monitoring, and updating. Heads at all levels are responsible for ensuring compliance with these provisions.
The Krka Group comprises the controlling company Krka and subsidiaries in Slovenia and abroad. Generally, Krka is the sole owner of the subsidiaries incorporated as limited liability companies.
Uniform governance, organisation, and operation rules are applied to all companies in the Krka Group, unless otherwise required by national legislation. The controlling company sets the strategies and objectives of all individual subsidiaries in the Krka Group and monitors the implementation of their plans. To ensure cohesive management and supervision across the Group, the controlling company’s Management Board also acts as the AGM of all subsidiaries.
One exception is the joint venture in India, established in 2024 by Krka and Laurus Labs Ltd. from India. Krka holds a 51% stake in the new company, while Laurus holds 49%. Krka has three representatives on the company’s five-member Board of Directors, one of whom is the President.
Another significant exception is Ningbo Krka Menovo Pharmaceutical Co. Ltd., the joint venture in China, where Krka holds 60%, and the Chinese partner, Ningbo Menovo, a 40% shareholding. Krka has two representatives on the company’s three-member Board of Directors, one of whom is the President.
Internal auditors discharge their duties in the Krka Group based on medium-term and annual work plans per the applicable rules (International Standards for the Professional Practice of Internal Auditing, Code of Ethics).
In line with the 2024 work plan, eighteen regular internal audits were conducted using the COSO (Committee of Sponsoring Organizations of the Treadway Commission) methodology.
The COSO methodology is globally recognised and serves as the basis for comprehensive monitoring of risk management and internal control systems. Internal auditors use these methods to assess the fulfilment of audit objectives in several categories: business operations, reporting, and compliance with the regulations of each audit area.
Internal audit reviewed processes in: purchasing, API production, pharmacokinetics and preclinical research, sales, QA compliance, new product development, and IT support for production and research, development and quality. Regular internal audits were also conducted in several subsidiaries and representative offices in Slovenia and abroad. Moreover, internal auditors provided consulting services in line with the aforementioned standards. In 2024, Internal Audit primarily participated in the implementation of the European Sustainability Reporting Standards (ESRS).
Internal auditors provided assurances that the applied systems of internal controls in the audited areas and processes had been established, operational, and effective in achieving set objectives. However, opportunities for improvement were identified, leading to recommendations categorised by individual risk levels, coupled with regular verification of their implementation.
Internal auditors work with the Krka Supervisory Board, its Audit Committee, and external auditors. In line with the International Standards for the Professional Practice of Internal Auditing, Internal Audit has been subject to four independent external quality assessments since its establishment. On each occasion, we received an overall opinion that Internal Audit activities generally conform with the International Standards for the Professional Practice of Internal Auditing and the Code of Ethics.
The Krka Group has established internal controls, i.e. guidelines and procedures at every level of operation to manage financial, sustainability, and tax reporting risks. Internal controls ensure the reliability of reporting and compliance with applicable legislation and other internal and external regulations. The Management Board is responsible for establishing internal control and risk management mechanisms while ensuring transparent reporting in line with regulations and good practice. Our internal controls ensure the accuracy and reliability of information for decision-making and reporting.
In terms of sustainability reporting, we built on best practices from previous periods when we adhered to GRI (Global Reporting Initiative) standards. As we transitioned to European Sustainability Reporting Standards (ESRS), our focus has been on establishing internal controls for data collection, analysis, and disclosure. The prepared content was reviewed and approved by responsible persons in relevant professional fields (heads and directors of organisational units), those tasked with preparing the ‘Sustainability statement’ (Finance and Corporate Performance Management), and the Management Board member responsible for sustainability. This content forms the basis for decisions aimed at achieving the sustainability goals set out in our strategy.
We plan to strengthen internal sustainability controls in the coming years, especially by working towards more effective IT support. These controls will also be subject to internal audit.
accounting data between the subsidiaries and the controlling company, and therefore also control of information.
The Krka Group Tax Strategy, Krka Group Tax Code of Conduct, and the Krka Group Tax Conduct Statement set out the policy, objectives, guidelines, and principles of tax management, including transfer pricing, based on principles and rules of ethical conduct and good business practices and standards of conduct, which are defined in Krka’s Code of Conduct. The Tax Strategy and the Krka Group Tax Conduct Statement are available at www.krka.si.
The basic guidelines and principles that the Krka Group follows in the tax field are to: comply with the legislation in the country in which we operate; settle tax liabilities voluntarily and on time; avoid risky tax decisions; consider the tax perspective when changes occur or when introducing new business models or transactions; track changes in tax legislation and continuously train employees involved in the tax process; work with tax authorities and ensure open, fair and constructive cooperation, and maintain a good partnership. All this should be ensured through the appropriate organisation and functioning of the Krka Group’s tax function and clearly defined responsibilities.
Accounting and tax controls are closely linked to information technology controls, which, among other things, serve to restrict and control access to networks, data, and applications and the completeness and accuracy of data capture and processing. Authorised external agents also verify the compliance of operations and the existence of the requisite controls within information systems annually.
We manage risks related to the consolidated financial statements of the Krka Group by directing the accounting activities and their supervision in the subsidiaries and by auditing the annual financial statements of the majority of Krka Group subsidiaries.
The audit firm KPMG SLOVENIJA, podjetje za revidiranje, d. o. o., audits the financial statements of the controlling company, the consolidated financial statements of the Krka Group, and the sustainability statement. The shareholders appointed the audit firm as the auditor for financial years 2022, 2023, and 2024 at the 28th Annual General Meeting of Krka held on 7 July 2022. The external auditor reports audit findings to the Management Board, Supervisory Board, and the Audit Committee of the Supervisory Board.
Transactions between Krka and the audit firm KPMG SLOVENIJA, podjetje za revidiranje, d. o. o., and transactions between the Krka Group companies and individual audit firms are disclosed in the ‘Financial report’ under the ‘Notes to the consolidated financial statements’ (‘34. Transactions with the audit firm’).
| Name and surname | Function | First appointed | Duration of current term of office | Representing |
|---|---|---|---|---|
| Jože Mermal | President | 2015 | 2025 | Shareholders |
| Luka Cerar | Member | 2023 | 2028 | Shareholders |
| Matej Lahovnik | Deputy President | 2020 | 2025 | Shareholders |
| Julijana Kristl | Member | 2010 | 2025 | Shareholders |
| Boris Žnidarič | Member | 2016 | 2025 | Shareholders |
| Mojca Osolnik Videmšek | Member | 2019 | 2029 | Shareholders |
| Mari Božič | Member | 2024 | 2029 | Shareholders |
| Mateja Vrečer | Deputy President | 2005 | 2029 | Shareholders |
| Tomaž Sever | Member | 2005 | 2029 | Shareholders |
| 7/7 | 7/7 | 7/7 | 7/7 | 7/7 | 7/7 | 2/2 since member | 7/7 | 7/7 |
|---|---|---|---|---|---|---|---|---|
| Male | Male | Male | Female | Male | Female | Female | Female | Male |
|---|---|---|---|---|---|---|---|---|
| Slovenian | Slovenian | Slovenian | Slovenian | Slovenian | Slovenian | Slovenian | Slovenian | Slovenian |
|---|---|---|---|---|---|---|---|---|
| 1954 | 1976 | 1971 | 1953 | 1948 | 1966 | 1964 | 1966 | 1967 |
|---|---|---|---|---|---|---|---|---|
| University degree in economics | University degree in economics and master’s degree in international finance | PhD in economics | PhD in pharmaceutical sciences | PhD in social sciences and master’s degree in law | University degree in economics | PhD in quality management | PhD in pharmaceutical sciences | University degree in mechanical engineering and master’s degree in management and organisational sciences |
|---|---|---|---|---|---|---|---|---|
| Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
|---|---|---|---|---|---|---|---|---|
In 2024, no permanent or relevant conflicts of interest were identified in respect of any Supervisory Board member. Statements of independence are published on the Company website.
| No | Member of the Audit Committee | Member of the Audit Committee |
|---|---|---|
President of the Human Resource Committee and member of the Audit Committee
President of the Audit Committee
No
Member of the Human Resource Committee and since 24 January 2024, member of the Audit Committee
Member of the Human Resource Committee and since 24 January 2024, member of the Audit Committee
| No | 5/5 since member | 6/6 | 3/3 | 3/3 at Human Resource Committee meetings and 6/6 at Audit Committee meetings | 6/6 | No | 3/3 at Human Resource Committee meetings and 5/5 at Audit Committee meetings since member | 3/3 at Human Resource Committee meetings and 5/5 at Audit Committee meetings since member |
|---|---|---|---|---|---|---|---|---|
Supervisory Board members, especially shareholder representatives, have seats on supervisory or management boards of other companies, but not to the extent that would influence their work on the Supervisory Board of Krka. They comply with the provisions of the Companies Act (ZGD-1).
No member held such a position in 2024 or during the preceding two-year reference period.
Received several awards for his visionary work in the economy and activities in culture, sports, education, and the humanitarian field (S1, S3, S4, G1)
Contributed significantly to the development of expertise and practice in the financial field as an expert in international finance, analyses, and strategic planning (S2, S4, G1)
Authored and co-authored many scientific papers on strategic management; Extensive international experience in economic policy-making and governance (S1, S4, G1)
Long-time professor and dean at the Faculty of Pharmacy; Extraordinary achievements include developing and establishing pharmaceutical nanotechnology in Slovenia as well as researching and lecturing on accessible healthcare (S3, S4, G1)
In 2024, all members of the Supervisory Board were independent. Their independence was assessed using a questionnaire from the Corporate Governance Code for Listed Companies, adopted by the Ljubljana Stock Exchange and the Slovenian Directors’ Association.
– The role of the administrative, management and supervisory bodies (21(c) experience relevant to the sectors, products and geographic locations of the undertaking)
– The role of the administrative, management and supervisory bodies (5(a) the role of the administrative, management and supervisory bodies related to business conduct; and 5(b) the expertise of the administrative, management and supervisory bodies on business conduct matters)
– The role of the administrative, management and supervisory bodies (21(e) the percentage of independent board members)
| Name and surname | Function | Meeting attendance record | Gender | Citizenship | Year of birth | Education and qualifications | Independent according to Corporate Governance Code for Listed Companies | Membership of supervisory bodies of other companies | ESG expertise |
|---|---|---|---|---|---|---|---|---|---|
| Borut Šterbenc | Independent external expert of the Audit Committee in accordance with Article 280 of the Companies Act | 6/6 | Male | Slovenian | 1978 | Holds a university degree in economics with experience in planning, leading, and conducting complex audits; Is a certified auditor registered with the Agency for Public Oversight of Auditing | Yes | Member of the hedge fund committee of Pokojninska družba A, d. d | Transparency in terms of reporting and business operations; Is a certified auditor |
| Name and surname | Function |
|---|---|
| Jože Colarič | President |
| Aleš Rotar | Member |
| Vinko Zupančič | Member |
| David Bratož | Member |
| Milena Kastelic | Member, Worker Director |
| First Appointment | Duration of Current Term of Office | Gender | Citizenship | Year of Birth | Education and Qualifications | Membership of Supervisory Bodies of Non-Related Parties | Independent | Leading or Managerial Position in Public Administration or with Regulatory Bodies | ESG Expertise |
|---|---|---|---|---|---|---|---|---|---|
| 1997 | By the end of 2027 | Male | Slovenian | 1955 | University degree in economics | No | Yes. Members’ independence is assessed upon their appointment. | No member held such a position in 2024 or during the preceding two-year reference period. | Extensive leadership experience; Numerous awards for running a large corporation; An outstanding reputation as a good businessman; Under his leadership, Krka developed into one of the leading international generic manufacturers (E1, E2, E3, E4, E5, S1, S3, S4, G1) |
| 2001 | By the end of 2027 | Male | Slovenian | 1960 | PhD in pharmaceutical sciences | No | Yes. Members’ independence is assessed upon their appointment. | No member held such a position in 2024 or during the preceding two-year reference period. | Knowledge of and extensive experience in the development and production of quality |
| 2010 | By the end of 2027 | Male | Slovenian | 1971 | PhD in pharmaceutical sciences | No | Yes. Members’ independence is assessed upon their appointment. | No member held such a position in 2024 or during the preceding two-year reference period. | Knowledge of and extensive experience in the development and production of quality |
| 2016 | By the end of 2027 | Male | Slovenian | 1976 | University degree in economics | No | Yes. Members’ independence is assessed upon their appointment. | No member held such a position in 2024 or during the preceding two-year reference period. | Knowledge of and extensive experience in the development and production of quality |
| 2016 | By the end of 2027 | Female | Slovenian | 1968 | University degree in food technology | No | Yes. Members’ independence is assessed upon their appointment. | No member held such a position in 2024 or during the preceding two-year reference period. | Knowledge of and extensive experience in the development and production of quality |
(managing development, research, pharmaceutical production, new products) (E1, E2, E5, S1, S2, S4, G1)
Supply chain management, contributed to the uninterrupted supply of medicines in markets and a resilient and flexible vertically integrated business model (E1, E2, E5, S2, S4, G1)
Responsible for sustainability improvements with regard to Krka’s operations; Contributed to the development of the local community (Krka’s societies); Contributed to tax and reporting transparency (responsible for the relevant organisational unit) (E1, E2, E3, E4, E5, S1, S2, S3, S4, G1)
Effective representation of workers’ interests concerning human resource and social issues as well as health and safety at work (S1, S2, S3, S4, G1)
| Year | Training and events outside Krka | Internal training sessions | Total hours |
|---|---|---|---|
| 2023 | 3 | 2 | 20.1 |
| 2024 | 4 | 3 | 26.4 |
The information regarding the training of the relevant Management Board member has not been verified by an independent external body.
The composition and amount of the Management Board members’ remuneration are disclosed in the ‘Financial report’ under the ‘Notes to the consolidated financial statements’ (‘30. Related party transactions’). Further details are available in the Report on Remuneration of Management and Supervisory Board members of Krka, d. d., Novo mesto, which is presented to the AGM. Since 2022, it is available as part of AGM materials.
Note to ESRS 2 GOV-1 – The role of the administrative, management and supervisory bodies (21(c) experience relevant to the sectors, products and geographic locations of the undertaking)
Note to G1 ESRS 2 GOV-1 – The role of the administrative, management and supervisory bodies (5(a) the role of the administrative, management and supervisory bodies related to business conduct; and 5(b) the expertise of the administrative, management and supervisory bodies on business conduct matters)
In 2024, Krka’s code of reference was the Slovenian Corporate Governance Code for Listed Companies (hereinafter: the Code), adopted on 9 December 2021 by the Ljubljana Stock Exchange and the Slovenian Directors’ Association. The Code entered into force on 1 January 2022 and is published on the Ljubljana Stock Exchange website.
We, the Management and Supervisory Boards of Krka, tovarna zdravil, d. d., Novo mesto, Slovenia, hereby declare that in 2024, individual members of the Management and Supervisory Boards and the Management and Supervisory Boards as bodies of a listed company acted in compliance with the principles and recommendations of the Code. Some of the recommendations were not implemented in full. However, we have always endeavoured to implement these recommendations and identify suitable ways of doing so. Any derogations from the Code are explained below.
In the context of self-assessment, the Supervisory Board can establish an annual training plan for its members and determine indicative training costs. In 2024, no proposal for additional training was put forward, so the plan was not adopted (Item 15.1 of the Code).
Supervisory Board members evaluated the Board’s performance in full accordance with the methods and the Supervisory Board Assessment Manual prepared by the Slovenian Directors’ Association. The evaluation was carried out professionally and objectively. Since external professional support was not required in 2024, no external assessment of the Supervisory Board’s performance was conducted in collaboration with a specialised institution or other experts (Items 16.2 and 16.4 of the Code). The Internal Audit of Krka monitors corporate governance procedures to the extent required by International Standards for the Professional Practice of Internal Auditing.
We use a digital application to distribute Supervisory Board materials securely. Supervisory Board members can access the archive until the end of their terms in office (Items 14.2 and 14.6 of the Code), which complies with our Information Security Policy.
According to our Rules of Procedure of the Supervisory Board, the President of the Supervisory Board has two deputies: a shareholder representative and an employee representative. This is necessary to ensure the inclusion of employee representatives in the key activities of the bodies. The Rules of Procedure of the Supervisory Board state that when the president is absent or unavailable to attend, the shareholder representative is first to assume the president’s duties and only in the absence of the former does the employee representative assume this role. This ensures we do not deviate significantly from the Code, which stipulates that only a shareholder representative may act as Deputy President of the Supervisory Board (Item 17.4 of the Code).
In 2024, Krka’s ‘Corporate governance statement’ was reviewed by an external auditor as part of the regular audit. An additional external assessment of the statement’s adequacy was not performed (Item 5.6 of the Code).
The uniform tables (Attachments C1 and C2 to the Code in force). The Management Board members do not hold corporate governance and supervisory roles outside the Krka Group, while information about the Supervisory Board members’ engagements is included in their CVs (Item 5.5 of the Code).
In line with the Remuneration Policy for Management and Supervisory Bodies, variable remuneration is always paid in two instalments: the first part mid-year based on semi-annual results; and the second part as back pay after the Supervisory Board confirms the annual report at their meeting (Item 23.2 of the Code).
The Supervisory Board revised the Management Board variable remuneration criteria in 2012, 2014, 2016, and 2018, taking into account additional Management Board duties related to business strategy, changes in the business climate, and remuneration trends. In 2022, the Supervisory Board further adjusted the remuneration policy in 2022 and submitted it for AGM approval for the first time. In line with the shareholders’ comments at this AGM, the Supervisory Board revised the remuneration policy again in 2023. It was approved with 97.45% of votes during consultative voting at the 29th AGM in 2023. The Supervisory Board did not set the criteria annually, as recommended in Item 14.11 of the Code, because they relate to the Krka Group’s long-term development strategy.
Under the Rules of Procedure of the Management Board, Management Board members may sit on supervisory boards of non-related companies only after informing and obtaining approval from the Company’s Supervisory Board. This is a partial derogation from Item 21.6 of the Code, which applies to all companies, not just non-related ones.
We publish contact details for investors and the public on our website, but do not list names of individuals (Item 31.2 of the Code), as multiple people are responsible for different areas.
We also made the Rules of Procedure of the Supervisory Board public. In the 2024 ‘Corporate governance statement’, we disclosed the composition, remits, and other aspects concerning the operation of our bodies, and providing all essential information on corporate governance. We did not publish any additional operational documents related to the bodies’ performance in 2024 (Item 32.7 of the Code).
Two members of the Supervisory Board, i.e. employee representatives, could be regarded as members of the wider management team according to certain criteria (Item 13 of the Code). This is despite the fact that they cannot make entirely independent decisions in their respective areas of work concerning financial resource allocations, employment, or strategy. These two members have served for more than three terms of office, but are not dependent members (Statement of independence of Supervisory Board members).
We also adhered to the majority of the provisions of the applicable Best Practice for GPW Listed Companies code, which applies to companies listed on the Warsaw Stock Exchange. We explain discrepancies in a separate document published through the Warsaw Stock Exchange dissemination system.
Novo mesto, 24 March 2025
Jože Colarič
President of the Management Board and CEO
Jože Mermal
President of the Supervisory Board
Jože Colarič
President of the Management Board and CEO
Dr Aleš Rotar
Member of the Management Board
Dr Vinko Zupančič
Member of the Management Board
David Bratož
Member of the Management Board
Milena Kastelic
Member of the Management Board – Worker Director
The current Krka Group development strategy covering the five years from 2024 to 2028 was prepared by the Management Board and approved by the Supervisory Board of Krka in November 2023. The strategy focuses on maximising added value for the Krka Group and investors. It covers all areas of operation within the Krka Group, especially its core pharmaceutical and chemical activities. The strategy views the Krka Group as an international corporation since it operates through subsidiaries and representative offices abroad, along with collaborative ventures with partners in all locations where it operates. It regards all business processes within the Krka Group, from development and production to marketing and sales, including all support processes. The Krka Group revises its development strategy every two years. The next revision is planned for autumn 2025.
The development strategy builds on the mission, vision, and values of the Krka Group.
MISSION
Living a healthy life.
VISION
We are continually consolidating our position as one of the leading generic pharmaceutical companies in the world.
VALUES
Speed and flexibility
Partnership and trust
Creativity and efficiency
The development strategy is based on an in-depth analysis of Krka’s position in the global generic pharmaceutical industry. The strategy outlines the originator and generic pharmaceutical industry characteristics, growth projections for the generic market, and Krka’s position in the international generic pharmaceutical industry. These aspects were considered when identifying potential avenues and opportunities for further development and sustained independence going forward.
In addition to these starting points, the strategy comprises three different sections: strategy and objectives at the Krka Group level, objectives by regions and territories with a product range strategy, and strategies of individual business functions and processes. It also includes a draft development, financial, and investment business plan.
The strategy also outlines the Krka Group’s focus on sustainability. It reinforces our commitment to integrate sustainability aspects into corporate governance and business decisions, thereby maintaining our economic, social, and environmental responsibility to the environment in which we operate.
management is based on the Risk Register. The Risk Register provides a comprehensive overview of risks at the Group level, designed to promptly identify and manage factors that may hinder the objectives defined in the development strategy. Every time the strategy is updated, the Risk Register is also updated. Further information is available in the ‘Risk Management’ section.
Strategic objective success is measured against performance criteria established at three levels: the Krka Group, product and service groups, and business functions. The Management Board monitors the Group’s performance criteria, while the relevant committees (Sales Committee; Development Committee; Economics and Finance Committee; Information Technology Committee; Human Resource Committee; Quality Committee; Corporate Identity Committee; and Sustainability Board) monitor criteria at the level of product and service groups and business functions. The guiding principle in managing the criteria system is to increase the competitiveness of the Krka Group as a whole and of individual Group companies.
To maintain and improve the Krka Group’s standing on the global stage, we leverage all external opportunities and maximise internal advantages, particularly through the coordinated and synergistic collaboration of organisational units within the Krka Group and efficient management of partnerships across the value-added chain.
To further pursue digitalisation of business operations, manage information technology efficiently and in compliance with regulatory standards, and ensure high availability and information security of the implemented IT solutions. To develop business analytics (SAP BW/SAP HANA) in data strategy, also by using modern cloud solutions and artificial intelligence, and to monitor the effectiveness of data source implementation and use throughout the entire supply chain (key performance indicators (KPI), overall equipment effectiveness (OEE), showrooms).
To strengthen professional and cost synergies within the Krka Group and maximise the utilisation of competitive advantages in the business environments of our subsidiaries abroad.
To ensure suitable talent attraction and retention strategies.
To ensure personnel are appropriately qualified by providing continuous training to employees throughout their careers at Krka.
To strengthen internationalisation within the Krka Group by managing employee potential in an international environment and ensure the activation of all human resource potentials to attain strategic and operational goals of the Group.
To effectively identify and manage sustainability risks and opportunities to strengthen Krka’s competitive advantages and maintain its long-term ability to achieve strategic goals and create value for stakeholders.
To enhance the visibility and positive image of the Krka Group with all stakeholders.
To ensure high levels of business ethics, integrity, transparency, and corporate compliance.
To strengthen our position as one of the five leading generic pharmaceutical companies in our traditional markets (Regions Slovenia, South-East Europe, Central Europe, and East Europe). This involves increasing our sales and market shares, in particular in therapeutic classes and molecules with already strong Krka’s presence (cardiovascular system, central nervous system, gastrointestinal tract, pain relief, cough and cold, and companion animals), and in classes with a high growth potential (diabetes, blood and blood-forming organs).
To continue a proactive sales policy and maintain strong, high-quality marketing and sales teams in all markets.
To consolidate Krka’s reputation, high direct customer satisfaction scores, and the recognition of products marketed under Krka’s brands among doctors, veterinarians, pharmacists, in pharmacies and wholesalers.
To continue to optimise our product range and take advantage of business opportunities in the markets.
To enhance the visibility of Krka (Krka and TAD brands) and our market position in markets of the Region West Europe, primarily through our subsidiaries and unrelated partners, and to improve our position as one of the ten leading generic pharmaceutical companies in all western European markets.
To achieve sales growth in volume and/or value exceeding the Krka Group sales growth average.
To maximise the current product range potential and extend the product range in the existing therapeutic areas while entering new ones, primarily with medicines for treating diabetes and cancer.
To strengthen our position and reputation with pharmacists and selected target groups of doctors.
To strengthen the recognition of Krka’s companion animal product range.
To market our products under our brand names in the Region Overseas Markets and through partnerships with unrelated parties.
To enter new markets by acquisitions and establishing specialised local joint ventures in which Krka has the majority share (marketing authorisations, marketing, etc.).
To identify a selected overseas market as a key market.
To continue marketing authorisation and sales activities and win tenders in China through direct presence in the market.
To retain the cardiovascular system, the central nervous system, the gastrointestinal tract, and pain relief as the key therapeutic areas. To add diabetes to our key therapeutic areas. To add blood and blood-forming organs to our key therapeutic areas.
To introduce innovative products, in addition to generic products, in the market of leading medicines (innovative combination medicines, new strengths, dosage forms) in the key therapeutic areas.
To supplement the portfolio of antidiabetics, antithrombotics, and oncology agents with new products.
To supplement the range of (double or triple) combinations for the treatment of hypertension, hyperlipidemia, heart failure, diabetes, and pain relief.
To evaluate the possibility of entering other therapeutic areas with our products or products of unrelated partners.
To monitor and evaluate the possibility of entering the therapeutic area of complex peptide-based therapeutics.
To provide key sales products through the vertically integrated business model.
To ensure cost competitiveness and profitability of key sales products by optimising formulations and technological procedures and manufacturing products cost-effectively.
To ensure formulation and procedure optimisation and cost competitiveness of new products before and/or during the launching phase.
To launch products with high sales potential among the first generics – right after patent expiry.
To adapt marketing authorisations for medicinal products and their names (brands and names consisting of international non-proprietary name and marketing authorisation holder, INNMAH) to market situations and regulatory requirements.
To try to launch at least one new medicine every year in most markets.
To retain pain relief, cough and cold, and gastrointestinal tract and metabolism as our key therapeutic areas.
To supplement the umbrella brands in key therapeutic areas with products with new ingredients and dosage forms.
To supplement our portfolio with products related to key therapeutic areas of prescription pharmaceuticals, with products that can be switched from prescription to non-prescription status (synergy in promotion), and products from other or new categories with marketing potential.
To search for new products of unrelated partners, which are promising and have appropriate economic value.
To focus on Slovenia and markets of Regions East Europe, Central Europe, and South-East Europe.
To retain products for companion animals (antiparasitics and medicines for pain relief) as our key therapeutic area.
To supplement the product range for companion animals with dermatologicals and evaluate the possibility of entering the therapeutic area of cardiovascular diseases.
To expand the product range for companion animals with new combinations, dosage forms (soft chewable tablets), and technologies.
To maintain the existing range of products for farm animals.
To focus on selected traditional markets and selected markets in Region West Europe, where we already have our own marketing and sales network for human health products.
To deliver at least 3% average annual revenue growth and increased profitability.
To ensure that foreign visitors account for one-third of total visitors.
In 2024, Krka Group sales revenue amounted to €1,909.5 million, up 6% on 2023 and 3% above the planned target. Of that, revenue from contracts with customers on sales of products and services amounted to €1,899.8 million, and revenue from contracts with customers on sales of materials and other sales revenue constituted the difference.
Sales were well distributed across Regions Slovenia, East Europe, West Europe, Central Europe, South-East Europe, and Overseas Markets. Region East Europe recorded the highest sales, with the Russian Federation remaining the largest individual market.
Sales in markets outside Slovenia accounted for 94%, aligning with the planned target.
Prescription pharmaceuticals remained the leading product group in terms of sales, accounting for 83% of total sales, which was in line with our forecasts.
Net profit of €356.2 million was higher than planned.
We expect product and service sales to generate a robust €2 billion. Sales in markets outside Slovenia are forecast at 94%. We expect prescription pharmaceuticals to remain our leading product category, accounting for 82% of total sales. Profit is expected to total €365 million. The total number of employees in Slovenia and abroad is expected to rise by 1%. We plan to allocate just over €150 million to investments, primarily for expanding and modernising production facilities and infrastructure.
Sustainable development addresses environmental, social and corporate governance matters (ESG). It is a fundamental driver of Krka’s ability to create long-term value and efficiently implement the Krka Group’s development strategy. Managing sustainability-related impacts, risks and opportunities, achieving sustainability targets, and transparent reporting are gaining in importance for Krka Group stakeholders. As a result, these aspects are being thoroughly integrated into our strategy and business model. For the first time, the Annual report includes the Sustainability Statement formulated in compliance with the European Sustainability Reporting Standards. The Sustainability Statement was subject to an external audit.
We carefully plan the development of our products and all processes that impact both lives and the environment in which we operate. By upholding expertise, professionalism, ethical conduct, and stringent quality standards across all aspects of our operations, we establish trust with the patients and partners. Guided by sustainable development principles, we strive to improve our performance in nature protection, health and safety, while actively shaping our social landscape.
We have identified six strategically important sustainability areas, in which the material impact of our operations on the social and natural environment is the most significant. These areas also relate to material sustainability-related risks and opportunities for the Krka Group.
In assessing double materiality, we mapped strategically important sustainability areas within a double materiality matrix. The y-axis presents key sustainability areas based on the relative impact of Krka’s operations and the value chain on the natural and social environment, reflecting impact materiality. The x-axis presents sustainability areas regarding the potential financial impact of sustainability-related risks and opportunities arising from these six strategic areas on Krka Group operations and financial results.
In 2022, we took a significant step forward in integrating ESG principles into our strategic planning and business operations, aligning with Krka Group key strategic objectives up to 2026. We adopted strategic goals related to key sustainability areas. The fundamental objective of integrating sustainability principles and ESG governance approaches into Krka Group’s management processes and business decisions is to enhance the identification of sustainability-related impacts, risks and opportunities. This, in turn, enhances their management and supports the long-term success of our business operations. We integrated the entire sustainability management topic into the revised 2024–2028 Krka Group Development Strategy and updated our strategic sustainability (ESG) objectives accordingly.
The Environmental, Social and Governance (ESG) Policy of the Krka Group applies to the controlling company and all its subsidiaries, demonstrating our commitment to applying sustainability principles and encouraging their integration into business processes across Krka’s value chain. In 2023, the revised Policy was discussed and adopted by Krka’s Supervisory Board and Management Board and published on SEOnet of the Ljubljana Stock Exchange, ESPI of the Warsaw Stock Exchange, and Krka’s website. In 2024, we adopted a package of new corporate sustainability policies, comprising the Environmental Policy of the Krka Group, the Human Rights Policy of the Krka Group, the Diversity, Equity and Inclusion Policy of the Krka Group, the Due Diligence Policy of the Krka Group, and the Code of Conduct for Business Partners of the Krka Group. Our new policies further enhanced corporate compliance in the Krka Group.
We identified the key United Nations Sustainable Development Goals that our operations help advance. Goal 3 ‘Good health and well-being’ is the most significant, as our core business can play a major role in advancing it.
On 31 January 2025, Krka received the S&P Global CSA score from S&P Global, the international credit and ESG rating agency. The 56 out of 100 score is higher than the 2023 score, placing us among the top 10% in the pharmaceutical industry as of 31 January 2025. The independent sustainability score reaffirms the outlined direction of the Krka Group’s sustainable management practices and ESG governance, prioritising our corporate social responsibility and care for the health and well-being of patients. We provide them with access to high-quality, safe, and effective medicines produced in accordance with the highest standards of good manufacturing practice. Throughout this process, we prioritise environmental protection and reducing our environmental impact. Furthermore, we uphold the highest standards of business conduct, integrity, and transparency in the governance of the Krka Group. The score encourages and commits us to improve the sustainability practices of the Krka Group going forward.
The Company’s Supervisory Board and Management Board adopted revised strategic goals in key sustainability areas. For the first time, sustainability management and ESG goals were fully incorporated into the 2024–2028 Krka Group Development Strategy. The adopted goals complement the Krka Group’s ESG Policy and contribute to our long-term business success. They outline specific strategic directions, goals, and key performance indicators (KPI) in key sustainability areas. The summary of strategic ESG goals is published on Krka’s corporate website.
| Indicator | Up to 2028 target | 2024 result | Notes |
|---|---|---|---|
| Specific use of energy (TJ/billion units) | <80 | 78.1 | Attained |
| Indicator | Up to 2028 target | 2024 result | Notes |
|---|---|---|---|
| Critical non-compliances identified in inspections by authorised bodies or partner audits | 0 | 0 | Attained |
| Justified complaints to released batches ratio | <1% | 0.79% | Attained |
| Indicator | Up to 2028 target | 2024 result | Notes |
|---|---|---|---|
| Employees trained in sustainability, corporate compliance and human rights | All employees every two years | 11,692 employees or 91.3% | Attained (excluding long-term absences) |
| Key and promising employees in the Krka Group | ≥10% | 14.6% | Attained |
| Revenue allocated to education | 0.35–0.50% | 0.44% | Attained |
| Training hours per employee | 40 | 43.8 | Attained |
| LTIFR (Lost Time Injury Frequency Rate) | <5 | 3.41 | Attained |
| Number of fire drills | >45 | 75 | Attained |
| Hours of training in occupational safety and health | >10,000 | 20,965 | Attained |
The Krka Group intends to further reduce its carbon footprint. We will monitor trends and leverage the best available decarbonisation techniques in transport and the supply of carbon-neutral energy sources (renewables, hydrogen, etc.) and utilise them in our processes wherever feasible. We will monitor legislative developments, particularly the CS3D Directive regarding the preparation of the transition plan aligned with the Paris Agreement and climate neutrality by 2050. Emerging technologies, carbon-free energy sources, and new legislation will have a considerable impact on the effective implementation of sustainable environmental policies in the near future. Maintaining growth, development, and competitiveness in the global market is paramount for Krka.
| Indicator | Up to 2028 target | 2024 result | Notes |
|---|---|---|---|
| Average sales volume growth per year | 5% | 2% | 5.1% average growth* |
| Average increase in patients treated with Krka’s cardiovascular agents per year – direct contribution to the relevant sustainable development goal from the 2030 Agenda for Sustainable Development | 3% | 7.2% | Attained |
| Position in key therapeutic areas, for example |
| Indicator | Up to 2028 target | 2024 result | Notes |
|---|---|---|---|
| R\&D intensity | 10% | 9.7% | Attained |
| Indicator | Up to 2028 target | 2024 result | Notes |
|---|---|---|---|
| Investments –average annual CapEx | €140 million | €117.0 million | Investments continued as planned |
| Indicator | Up to 2028 target | 2024 result | Notes |
|---|---|---|---|
| EBITDA margin | >25% | 27.2% | Attained |
| Net profit of majority shareholders for dividend pay-outs | ≥50% | 73.6% | Attained |
| Indicator | Up to 2028 target | 2024 result | Notes |
|---|---|---|---|
| Corrective actions to meet ethics in clinical trials | 0 | 0 | Attained |
| Indicators | Up to 2028 target | 2024 result | Notes |
|---|---|---|---|
| Documented cases of fraud, corruption, non-compliance, unethical, unprofessional, or unlawful conduct by employees | 0 | 0 | Attained |
| Cases of human rights violations in the Krka Group |
| Indicator | Up to 2028 target | 2024 result | Notes |
|---|---|---|---|
| Unethical or legally inappropriate marketing activity claims | 0 | 0 | Attained |
| Off-label promotion claims | 0 | 0 | Attained |
| Indicators | Up to 2028 target | 2024 result | Notes |
|---|---|---|---|
| Zero tax adjustment and sanction rate in tax control or inspection procedures in compliance with Krka’s tax management principles | 0 | 0 | Attained |
The Krka Group’s dispersed international operations and vertically integrated business model ensure stable performance, even amid fluctuating and changing conditions in key sales markets.
Following a prolonged period of stagnation, the European economy began to grow again in early 2024, increasing by 0.9%. The growth was moderate and stable, accompanied by a continued easing of inflationary pressures despite increased uncertainty. In 2025, economic growth in Europe is forecast to accelerate to 1.5%, driven by increased consumption and investment. The fall in inflation, which began at the end of 2022, continued throughout 2024. Although inflation saw a slight uptick in October due to rising energy prices, inflation in the European economy more than halved to 2.6% in 2024 and is set to fall to 2.4% in 2025.
Household disposable income increased in 2024. Recent experiences with high inflation led households to be cautious in their spending and prompted them to allocate a larger portion of their income to savings due to high interest rates. In 2024, the European Central Bank (ECB) began relaxing monetary policy, a trend expected to continue in 2025. By the end of 2025, the key interest rate is forecast to drop to around 2%. Most central banks in non-euro area member states are also signalling a relaxation of monetary policy in 2025. More significant monetary relaxation measures are expected in Romania and Poland.
In 2024, the labour market saw the creation of additional jobs, although employment growth slowed. Labour shortages further decreased, particularly in the industry. The slowdown in employment growth is expected to persist in the coming years. In 2024, the unemployment rate fell to 6.1% and is projected to reach a new historic low of 5.9% in 2025.
Due to unexpected tax revenue and fiscal consolidation, the public finance deficit of the European economy decreased to 3.1% of GDP in 2024 and is projected to further decline to 3.0% in 2025. The public debt-to-GDP ratio of the European economy rose to 82.4% in 2024 and is expected to rise again to 83% in 2025, driven by continued significant public finance deficits.
Economic growth in the Russian Federation remained at 4.1% in 2024. In the coming years, a soft landing of the Russian economy is anticipated, as opportunities and conditions for sustained significant economic growth remain limited. In 2025, economic growth is projected at 0.9%. The annual inflation rate rose to 8.5% in 2024, surpassing expectations. In the first half of 2025, inflation is forecasted to be higher than in 2024. However, it is expected to ease in the second half of 2025, falling to 6.5% by the end of the year.
| Country | Pharmaceutical market growth (%) | Projected value of pharmaceutical market at wholesale prices (€million) | FX rate (currency/€) | Annual change in GDP (%) | Annual inflation rate (%) |
|---|---|---|---|---|---|
| Slovenia | 9 | 1,115 | Euro area | 2.5 | 3.2 |
| Croatia | 10 | 2,050 | Euro area | 3.3 | 3.4 |
| Romania | 7 | 6,100 | 5.0 |
RUB2,380 billion
3,606
11,762
2,923
4,610
2,230
2.3
299,612
Primarily Euro area
Pharmaceutical market forecasts are based on internal estimates. The forecasts consider entire pharmaceutical markets, including the generic segment. Other forecasts are based on bank reports and European Commission reports.
In accordance with legislation and good practice, risk management comes under the remit of the Management Board, which regularly reports on risks and adopted measures to the Audit Committee and the Supervisory Board. In every evaluation of business performance, the Audit Committee and the Supervisory Board are briefed about operational, business, and financial risk management. The ‘2024 Supervisory Board report’ outlines the risk management work of the Audit Committee and the Supervisory Board. The Krka Group monitors its exposure to diverse risks daily and implements measures to manage those risks.
The following committees and Management Board-authorised representatives also have certain risk management-related authorities:
Risk management is integrated into all business processes across the Group. The controlling company manages financial risks centrally at the Group level, while subsidiaries independently manage business and ESG risks in accordance with the controlling company guidelines. We apply numerous standard operating procedures relating to quality systems, other bye-laws, and instructions that set down the activities and responsibilities crucial for enabling uninterrupted operations and mitigating risks.
In our risk management efforts, we use the Krka Group Risk Register, which provides a comprehensive overview of risks across the entire Group and serves to timely identify and manage factors that may hinder the achievement of our objectives. It is updated at least once every two years and always updated when the Krka Group Development Strategy is revised. The Risk Register was updated in 2024 and incorporates changes from the revised 2024–2028 Krka Group Development Strategy, greater integration of sustainability risks, and changes in the business environment.
We use the following risk management support tools:
are integrated into the Krka Group Development Strategy, encompassing all aspects of sustainable business operations, including strategic ESG goals. They are managed as part of various risks and included in the risk management processes. Governance approaches for specific strategic sustainability are defined in the ESG Policy (material ESG topics), adopted by the Krka Management Board and Supervisory Board. They are also addressed in the Sustainability Statement, per the European Sustainability Reporting Standards (ESRS), as part of identifying and assessing impacts, risks, and opportunities, as well as in the double materiality assessment. This also includes establishing new and upgrading existing business policies and activities to effectively manage sustainability risks and opportunities and reduce the negative impacts of Krka’s operations on the natural and social environment. We adopted these policies at the Krka Group level in 2024. The Sustainability Committee, Supervisory Board, Management Board, ESG coordinator, and ESG managers designated for specific organisational areas share the responsibility for the Company’s sustainable management.
Below, we outline Krka’s significant operating risks and our corresponding risk management approaches. Every risk assessment is based on the extent of the damage and the likelihood of its occurrence. The extent of the damage can be assessed as light, moderate, or severe, and the probability of its occurrence can be low, moderate, or high. The final assessment of an individual risk is made by simultaneously considering both assessments, with due regard to the effectiveness of risk control measures already in place. Based on this, the risk may be categorised as low, moderate, or high. In 2024, we defined a new risk category that includes other ESG and emerging ESG risks. These are general ESG risks not covered by other existing risk categories. We are gradually integrating this risk category into existing risk management areas while developing a systematic risk management approach. We will ensure this by establishing policies, appropriate strategic positioning, and setting ESG goals and key performance indicators.
| Risk area | Risk description | Control activities | Preliminary risk assessment | Latest risk assessment |
|---|---|---|---|---|
| Availability of critical resources to ensure production and sales of key products | Unplanned stoppages and unavailability of key resources for production and sales of finished products (employees, buildings, equipment, various materials, media supply, information, epidemiological situation) | Business continuity management system, business impact analysis, requirement for the availability of critical resources and services, risk analysis by area; measures to increase process resilience against disturbance and mitigate consequences of incidents, supervision of hygiene, organisational, and technical measure implementation to prevent the spread of infections, business continuity plans for critical processes, training, tests, drills | Moderate | Moderate |
| Supply of APIs and finished products | Delays in the supply of production materials and finished products and ineffective utilisation of means of production | Careful supply chain planning in consideration of the economic, health, and political situation around the world, pandemics, natural disasters, explosions, etc., careful planning of production material inventories, maintaining contingency stocks, ensuring several sources from various locations; providing adequate production capacities at Krka’s sites and alternative sites with contract manufactures, presence of Krka experts at certain production sites of contract manufacturers, establishing remote technology transfer, fast adaptation to sudden increases in product demand by providing additional resources and adjusting priorities; setting up alternative transport routes for production materials and finished products, establishing additional warehouse capacities with external providers. | Moderate | Moderate |
| Quality management | Loss of a manufacturing authorisation, distribution permit, or marketing authorisation | Adhering to legal and regulatory requirements and implementing necessary activities to achieve |
| Risk area | Risk description | Control activities | Preliminary risk assessment | Latest risk assessment |
|---|---|---|---|---|
| Technical services | Inadequate supplies of energy and industrial media to processes and substandard technical maintenance | Alternative energy supply resources, robustly designed media supply systems, redundant system and equipment capacities, provision of key spare parts, and carefully planned maintenance processes; adhering to legislation and other regulations and trends; employee education and training, monitoring of employee competence | Moderate | Moderate |
| Information technology | Business process disruption due to disruptions in information resources | Independent security checks and preventive measures to rectify disruption; assessment of different types of risks, information technology continuity plan, recovery procedures following major incidents and disasters | Moderate | Moderate |
| Employees | Workplace accidents or injuries, infectious diseases (epidemic, pandemic) | Testing technological procedures, system for workplace risk assessment, preventive measures, introduction of cautionary measures – sanitary, health, and organisational actions that prevent the introduction and spread of potential infections, while also ensuring uninterrupted implementation of all work processes | Moderate | Moderate |
| Issues arising from the epidemiological situation in the country, unplanned increase in absences, and shortages of personnel in the labour market | Employee interchangeability, new recruitment methods, appropriate and regular communication with employees, employee education and training, reorientation of activities to basic processes in the case of a significant loss of available personnel (e.g. pandemic, natural and other disasters) | |||
| Protection of property | Alienation and destruction of property | Security plan, systematic threat assessment, and implementation of necessary measures | Moderate | Moderate |
| Risk area | Risk description | Control activities | Preliminary risk assessment | Latest risk assessment |
|---|---|---|---|---|
| Research and development | Ineffectiveness of development processes; |
| inadequacy of regulatory procedures and supply of new products | Detailed planning of development projects and management of regulatory processes | Moderate | Moderate | |
|---|---|---|---|---|
| Marketing and sales | Regulation of international business environment and sales markets and inadequacy of marketing activities | Responding to changing geopolitical situations and statutory requirements related to business operations in markets, establishing standardised, compliant, and transparent sales and marketing activities, continuously educating and testing employees' knowledge, using modern communication tools and channels | Moderate | Moderate |
| Intellectual property | Infringement of third-party intellectual property rights or unjustified use of Krka’s intellectual property | Monitoring patent processes, consistent respect for third-party intellectual property rights, and forming provisions for potential damages when reasonable | Moderate | Moderate |
| Quality management | Substandard quality of processes that fail to ensure product suitability and regulatory compliance, substandard quality of products, and failure to maintain the validity of manufacturing authorisations, GMP certificates, and other certificates | Adhering to legal and regulatory requirements, implementation of improvements and new statutory requirements in routine work processes, planning of control procedures and quality assurance, regular evaluation and assessment of quality risks, supervision of quality assurance for products, processes and services, successful inspections and audits, achievement of expected quality and performance indicators, adherence to quality-related strategic objectives | Moderate | Moderate |
| Environmental protection | Climate change, waste removal issues, environmental pollution due to hazardous substance spills and emissions during emergencies; deviation from environmental emission limits, and loss of reputation due to excessive environmental pollution | Effective control of the environmental management process, monitoring of regulatory requirements, continuous emission monitoring; application of best available techniques to reduce environmental impact, safe storage and responsible handling of hazardous substances, maintaining a high level of environmental awareness among employees and contractors, partnering with multiple top-tier business partners in waste management | Moderate | Moderate |
| Investment projects | Poor decisions on investing in production and other capacities, and implementation of |
Constant supervision of all project phases, plan monitoring, systematic selection of contractors, adhering to legislation, other regulations, standards and guidelines, use of best available techniques
| Moderate | Moderate |
|---|---|
Issues with providing key and qualified personnel and social dialogue with employees
Systematic work with key personnel, remuneration system, employee development, continuous education and training, measuring of the organisational culture and climate
| Moderate | Moderate |
|---|---|
Reduced availability of suitably qualified workforce with scientific and technical expertise, as well as manufacturing employees
Monitoring of demographical changes, employer branding, scholarships, availability of mandatory work placements, investment in knowledge – national vocational qualification
| Moderate | Moderate |
|---|---|
Inadequate legal regulation of business relations and non-compliance with or incorrect interpretation of legislation, issues arising from potential court and other legal proceedings, especially disputes
Involving the Legal Affairs department in key areas, cooperation with external specialised legal experts
| Moderate | Moderate |
|---|---|
| Risk Area | Risk Description | Risk Management Method | Preliminary Risk Assessment | Latest Risk Assessment |
|---|---|---|---|---|
| Foreign Exchange Risk | Potential major financial losses due to unfavourable movements in foreign exchange rates | Financial market tracking; monitoring currency exposure; working with leading global financial institutions; monitoring new practices of foreign exchange risk hedging; use of financial instruments; natural hedging | Moderate | Moderate |
| Credit Risk | Customers defaulting on payment prompt receivable write-off accrual | Credit rating calculations; limiting maximum exposure to individual customers; active management of receivables; utilisation of instruments for insurance of payments and receivables with a credit insurance company | Moderate | Moderate |
| Liquidity Risk | Insufficient liquid assets for settling operating and financial liabilities |
| Moderate | Moderate |
|---|---|
Damage to property caused by natural disasters and other risk factors
Systematic risk assessments for buildings; implementation of measures in accordance with fire safety studies; arrangement of appropriate insurance, continuous development of the business continuity system
| Moderate | Moderate |
|---|---|
Claims for damages by third parties due to loss events caused unintentionally and accidentally by Company activities, property, or products placed on the market
Insurance for civil, employer and environmental liability; product liability insurance; and clinical trials liability insurance
| Moderate | Moderate |
|---|---|
Financial loss resulting from interruption of production due to property damage
Insurance of labour costs, amortisation and depreciation, other operating expenses and operating profit, and technical and organisational measures to reduce the impact of business interruption, continuous development of the business continuity system
| Moderate | Moderate |
|---|---|
| Risk area | Risk description | Risk management method | Preliminary risk assessment | Latest risk assessment |
|---|---|---|---|---|
| Transition into a carbon-neutral society | Risks associated with developing an action plan for transitioning into a carbon-neutral society and the impact on Group investments, strategy, business model, and competitiveness | Development of a strategy and action plan that aligns with regulatory requirements; meticulous investment planning in accordance with legislation and considering physical and transitional climate risks; climate scenario analysis, and assessment of climate risk impacts | NA | Moderate |
| Responsibility for ESG risks in the value chain outside the Krka Group | Liability for ESG risks in the value chain and non-compliance with the requirements of the Directive on Corporate Sustainability Due Diligence (CS3D) | Planning and implementation of policies and activities to ensure compliance with sustainability regulations, timely implementation of CS3D requirements | NA | Moderate |
Non-compliance of sustainability reporting with ESRS
Development of policies to enhance ESG management and frameworks for sustainability reporting in compliance with the requirements of the Corporate Sustainability Reporting Directive (CSRD) and standards, establishment of internal controls for sustainability reporting and systems for data collection and ensuring their integrity
| NA | Moderate |
|---|---|
Failure to meet stakeholder expectations and regulatory requirements, reduced competitiveness, loss of reputation, increased capital costs and decreased company value, lower ESG score
Activities to enhance ESG management, management of ESG risks, and ensuring sustainability reporting compliance
| NA | Moderate |
|---|---|
Availability of critical resources to ensure the production and sales of key products
Major emergencies causing prolonged interruptions in production and sales could compromise the existence of the Krka Group. We analyse their impact on operations to estimate the criticality of processes and risks to operations. As a result of these activities, the Business Continuity Officer prepares a Business Impact Analysis, Risk Assessment, and Business Continuity Management Strategy together with the persons involved in critical processes. The documents are discussed and adopted by Krka’s Management Board. The documents are revised at least every five years or sooner if significant technological and/or organisational changes occur, new threats emerge, or existing ones escalate.
We apply effective measures to protect employees, property, and other key resources and prevent emergencies. We have designed action plans with disaster relief plans for emergencies, including measures for mitigating direct damage, and emergency operations plans aimed at restoring normal operations as swiftly as possible. Based on the Business Continuity Strategy, we prepare business continuity plans for each critical process or service. In agreement with the Business Continuity Officer, we appoint persons responsible for critical processes to prepare and maintain these plans. Critical process or critical service managers and the Business Continuity Officer approve the plans.
The adequacy of plans is reviewed at least annually, ensuring alignment with the business continuity policy and strategy. Exercises and operational stress tests are pivotal in evaluating the implementation of specific business continuity measures. The Quality Committee discusses the adequacy of the implementation of these plans annually. In 2021, Krka’s Management Board also included pandemic-event measures in the Business Continuity Strategy. A pandemic could pose risks in various areas, resulting in, e.g. supply chain disruption, increased employee absences, and outsourcing-related issues. By identifying and implementing appropriate preventive and other measures, we ensure that critical resources are adequately available to ensure the production and sales of key products.
We continuously monitor the supply market, suppliers, and prices of production materials to ensure the required quantities are in line with annual, quarterly, and monthly production supply planning and in accordance with the standard operating procedure (SOP). We carefully plan our inventories and maintain contingency stocks to ensure uninterrupted access to production materials required for manufacturing finished products.
We apply adopted criteria to assess and select our suppliers and regularly audit them. Twice a year, the Quality Committee discusses the findings of past audits, indicators, supplier risk assessment, and the audit plan for the next period. A regular supplier audit is conducted every three years. In the case of emergencies and deviations, a risk assessment and an audit are conducted immediately. When selecting our contractual partners, we primarily focus on appropriate material specification, regulatory compliance, guaranteed quality and environmental protection, price competitiveness, and supply reliability. Relevant SOPs regulate the selection and evaluation of a contractual partner that manufactures finished products and implements and manages the transfer. SOPs are part of the quality system described in the ‘Quality management risks’ subsection. Further information on audits and routine controls are available in the ‘Pharmaceutical quality system oversight’ subsection of the ‘Quality’ section.
We ensure the timely supply of finished products by managing the planning operations and monitoring the execution of all product supply stages. Production material inventories are planned according to sales forecasts. Inventory levels are checked regularly, and we hold contingency stocks for strategically important production materials. We have several independent supply sources for APIs and production materials required for key products.
We carefully plan the optimal utilisation of production capacities and measure production efficiency. In this respect, we introduce measures for continuous process improvement. We procure new equipment and make new investments to fulfil sales demands, expanding our production capacities and contract manufacturing cooperations.
We adhere to good manufacturing practices in production processes and provide suitable production environment. We ensure that production equipment operates reliably and to a high standard through regular and preventive maintenance. In major emergencies, we can ensure the manufacture of key products across multiple production lines at several Krka production plants, as well as at contract manufacturing facilities.
We comply with good warehousing and manufacturing practices when warehousing production materials, bulk products, and finished products. Several standalone warehouses are available in the case of major emergencies. We organise the transport of production materials and products using our vehicles and those of our selected partners. All vehicles are equipped to ensure appropriate transport conditions and safety. We have set up several global (maritime, air, and road) transport routes that allow us to deliver materials in case of emergencies.
Technical service risks include energy and industrial media supply, operation of active fire safety and property protection systems, reliability and availability of technical systems and equipment, and risk associated with the metrological control of measuring and regulation equipment and control systems.
as a backup, for which we maintain extra stocks. We identified drinking and river water supply shortages for production purposes as a potential risk. At the main production site in Novomesto, Slovenia, where most of Krka Group’s products are manufactured, the river flow remains above the threshold level, even during extended dry periods. This allows us to draw water from the watercourse in accordance with the water permit. Therefore, the risk to the river water supply is acceptable or low. Additionally, thanks to public infrastructure upgrades in 2021, the short-term and medium-term drinking water supply is adequate at the main production site in Novo mesto, Slovenia. In the event of a loss of water supply from the primary public source due to force majeure, there is an option to connect to an alternative water source from the public infrastructure. However, owing to the disrepair of the municipal water supply system, this alternative does not guarantee a sufficient long-term supply of drinking water. To secure a reliable future supply, we are conducting a professional study to identify the most suitable long-term solutions for a sufficient, reliable, and high-quality water supply for the entire site.
We mitigate risks related to inadequate production and distribution of power and process utilities (electricity, steam, heating water, compressed air, refrigerant water, river water, pharmaceutical and process water) by critical equipment redundancy, robust system planning, computer control, quality control of process utilities, regular preventive maintenance and system testing, and keeping critical spare parts in stock. Employees receive periodic training, and their skills and qualifications are routinely assessed.
We provide servicing and scheduled maintenance for our systems to uphold the necessary HVAC standards within our buildings. Our maintenance team is efficiently organised and trained to address operational and maintenance concerns. The team uses a central computerised control system to issue alerts rapidly and detect faults. It also keeps inventories of spare parts. Non-critical equipment is dispersed to ensure that a single breakdown does not significantly impact production capacities. Critical equipment is duplicated. All air-conditioning and power supply systems in server rooms are duplicated, have technical security systems in place, and are regularly tested for potential breakdowns.
We mitigate risks to the reliability and availability of technical systems for active fire protection and property protection through continuous computer monitoring, regular preventive maintenance and system testing, critical equipment redundancy, robust system planning, and improvements. Employees undergo regular training, and their skills and qualifications are assessed regularly.
We mitigate risks to the reliability and availability of technical systems and equipment by continuously monitoring performance, conducting preventive maintenance checks, servicing, improving the equipment, and introducing new maintenance approaches using advanced diagnostic instruments. Failures and disruptions are rectified according to planned procedures and instructions. To remedy failures and disruptions promptly and effectively, we have our own qualified maintenance teams and spare parts inventories, which we regularly check and replenish. The employees who monitor, operate, and maintain technical systems and equipment undergo regular training. Their qualifications and skills are routinely assessed.
Metrology is a major factor behind product and service quality, safety, and efficacy. It is closely related to measurement traceability and global comparability of measurement results. This is why we have a distinctive, stable and rational management system in place for monitoring and measuring equipment in compliance with the highest industrial standards. We regularly measure, calibrate, and maintain the monitoring and measuring equipment based on its GxP criticality assessment. We use approved procedures and apply the latest standards to minimise the risk of deviations.
We ensure the reliability and availability of technical systems and equipment with our own resources and in cooperation with external contractual partners.
We manage information security and data integrity risks in line with the methodology of the Information Security Management System (ISMS), based on ISO 27001, under which the controlling company is certified. The ISMS is a separate business process within Krka’s quality system. The Company’s Management Board appointed the Information Security Officer to lead the ISMS process, which includes key organisational units and business processes in the controlling company. The Officer is responsible for implementing binding legislative and other regulatory requirements. Each quarter, the Officer reports on the activities carried out to David Bratož, a member of the Management Board. Further information on the ISMS is available in the ‘Quality’ section. A comprehensive report on the Krka Group information security is discussed annually by the Information Technology Committee.
Krka specifies the criticality of information resources (information systems and services) using annual criticality assessments of business processes and information resources to implement the business process. The same level of criticality assigned to business services is also applied to all information systems, including infrastructure systems. Recognising the critical importance of planning, constructing, and using information systems, we implement and apply all relevant advanced information and cybersecurity elements.
We have identified threats and risks regarding resource availability, confidentiality, and integrity for all critical information resources (information systems, equipment, premises, and employees using the information systems). Directors or heads of organisational units where the processes are carried out review and approve individual process risk assessments. Based on the assessments, organisational units take steps to eliminate unacceptable risks. Another method of threat detection involves independent security audits of our information resources. Internal audits of information security are conducted in organisational units as well. We consistently eliminate any inconsistencies identified in external and internal audits and inspections.
To ensure information security, we perform comprehensive security audits every two years and partial security audits multiple times yearly while eliminating shortcomings. To mitigate risks during major emergencies, we introduced duplicated computer capacities for all critical information resources at two separate locations: backup server rooms at the controlling company headquarters (i.e. the Disaster Recovery Centre– DRC) and an adequate off-site location, where critical data is backed up daily. Major security incidents are examined once a year by the Information Technology Committee.
As an international group, we are required to protect personal data in conformity with the national legislation of all countries where our subsidiaries and representative offices are located. The Management Board appointed a Data Protection Officer at the Company and the Group level, who ensures that personal data is protected in accordance with EU regulations or national legislation insofar as it lays down different or stricter rules.
We mitigate information technology risks, including cybersecurity, through appropriate investments, allocating 2% of our revenue and thus ensuring adequate availability (at least 99.5%) of key information services.
We manage all employee-related risks, systematically identify and evaluate them, and take appropriate measures to prevent and mitigate risks based on this. The Management Board checks and confirms the effectiveness of risk management.
We use our own methods to assess workplace risks concerning occupational health and safety, i.e. the probability of a specific incident and its consequences and any probable health implications for individual workplaces. Risks are assessed periodically and upon changes. Security measures are taken to keep them at acceptable levels.
measurements during technological operations. We promote health among our employees and constantly raise awareness of occupational health and safety. When there is a risk of infection (epidemic, pandemic), we implement a series of sanitary, health, and organisational measures to prevent the introduction and spread of the possible infection while ensuring that no work processes are disrupted.
Identifying key and promising employees in all work processes allows us to ensure the replacement of employees in key job positions. The training and recruitment methods applied in all organisational units facilitate the quick exchange of employees posted in similar positions should a shortage of employees occur in a certain organisational unit due to large-scale absences or increased workload.
Building and property exposure is subject to regular and systematic assessments under the Security Plan (18 types of threats). Based on the assessment, we prescribe physical and/or technical security measures, along with other security actions and guidelines, to prevent emergencies or respond accordingly if they occur.
Krka’s products must be high-quality, safe, and effective. The required properties must be confirmed by relevant research and data in compliance with regulatory requirements and standards. Risks to products and technologies include scientific and research risks and technological and technical risks. We mitigate these by introducing contemporary approaches and methods and exploiting in-house and acquired knowledge and experience in research, development, and technology.
Business and professional risks in product and technology development are managed based on a risk matrix at various levels of monitoring and decision-making. The responsibilities of leaders, organisational units, and work processes are clearly defined.
We appoint a project team with a leader to manage, monitor, and document all crucial activities for each project. The Development Committee approves proposals for new product development based on feasibility studies, in which the proposed project is considered from regulatory, developmental, safety, cost, and other aspects. In addition to key development milestones, the Development Committee also monitors all development projects to be able to respond appropriately to any market, development, or regulatory changes that require a change or adjustment in the development scenario. The Committee meets several times a year. In between the Committee meetings, we monitor projects at several organisational levels (project, product meetings, project meetings) and thus ensure that activities are appropriately supervised and directed. Key organisational units with precisely defined individual responsibility in the product development phase are New Products, Pharmaceutical R&D, API R&D, Quality Management, API Production, Pharmaceutical Production, and Industrial Property.
We mitigate these product-and-technological risks at the early stages of development through process updates, the introduction of advanced technologies, adjustments to regulatory requirements, and the successful work of highly educated professionals, constant broadening of knowledge, and state-of-the-art equipment. The vertically integrated development and production model is important, as it allows us to control the entire process, from manufacturing raw materials to selling the finished products.
We maintain the vertically integrated development model with investments, annual achievements, and research and development results related to:
Regulatory risk management, associated with legislation changes and interpretation, starts at the early stages of developing a new product and continues throughout its life cycle. We monitor regulatory legislation, implement new requirements relating to active ingredients and finished products already in the development phase, and consider them when preparing registration documentation and registration strategies to mitigate risks. Through official consultative mechanisms, Krka verifies its development solutions for each product and the planned content of marketing authorisation documents with regulatory bodies. This reduces the risk of encountering potential issues or even failure when obtaining or extending marketing authorisations. We are also engaged in working groups of various industry associations to participate actively in drafting statutory amendments in this field.
The Krka Group has a broad marketing and sales network, with its products sold directly in more than 70 countries worldwide. It operates in various geopolitical and macro-economic climates, as well as in legal and competitive environments, and is exposed to different sales and marketing risks of varying intensities.
Our key advantages over the competition are our quick response to altered business circumstances, especially concerning the recent events in eastern Europe, and prompt adjustment of sales and marketing activities in individual markets. We continuously monitor market conditions (especially competing generic producers and national pharmaceutical industry), the legal frameworks related to the movement of goods and services and marketing pharmaceuticals, systemic pricing arrangements, and government reimbursements for pharmaceuticals (in some countries based on statutory partial co-funding of healthcare budgets by medicine suppliers, i.e. clawback) through Krka’s in-house departments and independent data sources.
We ensure that medicine advertisements meet appropriate standards, with a strong focus on organising and supervising employees’ work within the marketing network. Our employees undergo training regularly, and we frequently test their qualifications, skills, and familiarity with work directions, legislation, and applicable regulations. In marketing our products, we strictly adhere to legislation, Medicines for Europe recommendations, and ethical standards for advertising pharmaceuticals. To ensure compliance, we provide comprehensive training and conduct regular employee knowledge assessments. We focus on business compliance, so marketing forms a part of the Company’s Integrity Plan, discussed by the Management Board. We also comply with the personal data protection legislation in marketing and sales.
We monitor the risks in existing markets, the risks related to entering new markets and new therapeutic areas, and risks associated with changing practices regarding prescribing and/or dispensing, and/or reimbursing medicines. We systematically discuss entering new markets at annual meetings and determine where to obtain marketing authorisations for individual products. Before concluding sales agreements, customers must provide proof that their business is duly registered. We carefully assess risks associated with specific market landscapes and economies and individual customer risks, particularly insolvency or bankruptcy risks, payment terms, and other contractual compliance risks.
(sales to end-users in pharmacies). We ensure that inventories are optimised and sufficient throughout the distribution chain. We duly monitor pharmacy networks and any changes by individual market, and adjust our actions accordingly. Sales Committee meetings discuss all of the above regularly.
We regularly evaluate the market potential of individual therapeutic areas and their products. We use a range of external data sources and our own market research and analyses to monitor global, regional, and national trends and product supply in the market. Based on these, we define the product portfolio and our activities according to the current market positions of particular active ingredients and their development path. We systematically analyse changes in market positions and product shares within individual therapeutic classes at least twice a year. The number of important new active ingredients available for marketing to generic manufacturers at present or in the future has been declining. Therefore, we seek opportunities in new innovative combinations of existing active ingredients and new therapeutic areas while continually striving to improve further the position of our products containing existing active ingredients. We monitor the effectiveness of our marketing strategies and tactics using performance indicators and exert systematic control over marketing activities, which we plan, implement, and analyse in cycles, including compliance in marketing and sales. Indicators at the Krka Group level are discussed yearly by the Sales Committee and by Krka’s Management Board in the context of performance indicators. At their regular meetings, supervisory bodies of subsidiaries and representative offices discuss more specific indicators at the level of individual markets.
We consistently comply with the Krka Group ESG Strategy in our business operations. As one of the leading generic manufacturers and an important partner of local healthcare systems, we enable access to affordable, safe, and efficacious advanced medicines. The Sustainability Committee discusses indicators such as achieving sales volume growth, increasing the number of people treated with our products from key therapeutic areas, and monitoring direct customer satisfaction with our product supply.
Respect for the intellectual property rights of third parties, especially patent-related rights, is one of the fundamental principles of the Krka Group operations. If we believe that the results of our research work are new and innovative, we apply for patent protection. Therefore, we start the development of a new product by analysing the status and extent of applicable third-party patent rights and determining which technical solutions are patent-protected. We define and direct our development work based on these findings and assess whether the technological and technical solutions produced by our own development infringe the applicable rights of third parties. The current situation and any potential changes in patent protection are monitored throughout a product’s development up to its launch.
Where we believe that patents have been improperly granted to third parties, meaning the patented solution is not actually an invention (due to a lack of novelty or inventive step), and that these patents might hinder our operations, we avail of available legal remedies to request their cancellation. This prevents holders of such patents from filing actions against us for infringement. Despite these measures, if a patent holder considers that Krka has infringed its rights and takes legal action against Krka, we set aside appropriate provisions for potential damages and adopt relevant measures. The same risk management method applies to distinctive signs, industrial designs, and other relevant intellectual property rights.
The Krka Group evaluates quality management risks regarding product quality, safety, and Group operations. We employ widely recognised risk assessment methods, adhering to the Good Manufacturing Practice (GMP) requirements, good practices, HACCP, and the implemented ISO standards (ISO 9001, ISO 14001, ISO 27001, ISO 14971, ISO 22301, ISO 45001).
Product quality is defined during the development stage of a product and specified in the marketing authorisation documents. We adhere to standard procedures and requirements throughout the production process. From purchasing various incoming materials, other purchases, and manufacturing processes to manufacturing finished products, quality control, warehousing, and distribution, all while ensuring the compliance of pharmaceutical products with the relevant quality standards and the product’s marketing authorisation documents. When a product is already on the market, the pharmacovigilance system is used to establish, evaluate, and respond to new findings on adverse effects and other safety aspects of a medicine. We employ a special system to process customer feedback and pursue constant internal improvements according to the PDCA (Plan-Do-Check-Act) principle to upgrade and improve processes and products.
Product quality management is a core activity that involves various quality assurance elements: we focus on the appropriate quality of incoming materials (i.e. active ingredients, excipients, and packaging materials), while conducting risk assessments to classify material- and supplier-related risks. We work closely with key strategic partners, regularly assessing process compliance and ensuring product quality. Based on the findings, we schedule audits and other activities as part of the GxP partner evaluation procedure and collaboration process.
We ensure the compliance of our production and control equipment and production rooms by qualifications and validations of equipment, production rooms, production environment, manufacturing processes, computer systems, cleaning procedures, calibrations, qualification of instruments, as well as maintenance procedures to prevent undesirable effects on the production process and product quality. Systematic approaches, monitoring, and documentation of all processes, procedures, and controls are crucial for product quality assurance. We, therefore, regularly examine, overhaul, upgrade, and improve the quality system and ensure that any necessary changes are made correctly. Further information on the quality system is available in the ‘Quality’ section.
We prioritise data integrity in quality management to minimise the misuse of test results when assessing the suitability of raw materials, packaging, processes, and finished products.
Regular monitoring of new legislative developments and prompt implementation of updated requirements mitigate the risk of inadequacies in the quality system, thereby reducing risks associated with maintaining manufacturing and marketing authorisations and GMP certificates.
We regularly raise awareness and deliver employee training to ensure compliance with standard production and product control procedures. We control production processes, intermediate products, bulk products, finished products, and the production environment to ensure product compliance and conformity with national legislation and GMP principles in the EU and other countries where we market our products.
For non-compliant products (deviations, complaints), we apply control mechanisms, perform tests, investigate causes, and implement preventive and corrective actions to prevent any other non-compliance.
As a component of quality risk management, we proactively mitigate the risks associated with the potential loss of manufacturing authorisations, GMP certificates, and other management systems utilised across Krka’s manufacturing and distribution units.
Krka recognises and manages any environment-related risks in line with the requirements of ISO 14001 and the European Sustainability Reporting Standards (ESRS), as well as by managing the business continuity system. Every year, we review all environmental aspects, the associated risks, and extraordinary events and evaluate their environmental impact. Risks and emergencies related to environmental protection, hazardous chemical handling, and climate change are assessed and managed at the Committee for Monitoring Environmental Aspects meetings at least twice a year and routinely by certain organisational units or business processes. All identified risks are included in the Report on Implementing Environmental Management System, which the Quality Committee discusses once a year. We mitigate risks and minimise our environmental impact by using the best available techniques in manufacturing, warehousing, wastewater treatment, waste air treatment, and waste management, by operating spill containment and firewater retention systems, by preventive examinations and maintenance of equipment, employee training, and by employing our fire brigade, which is qualified to intervene in cases of emergency, and emergency event drills.
We minimise the risk of non-compliance with statutory requirements and reputational damage from excessive environmental pollution by promptly implementing new requirements and conducting regular monitoring. We are upgrading and expanding the rainwater drainage system to address the risks of heavy rainfall events linked to climate change. We manage waste removal risk by expanding waste solvent warehousing facilities, segregating waste streams, and partnering with several contractual waste collection and disposal partners. We have enhanced spill containment and retention systems to manage risks associated with hazardous chemical and firewater spills. We also improved the system for supervising hazardous substance management.
We recognised the following relevant risks arising from climate change: the risks of water supply, floods, storms, and heavy downpours, as well as the risks of high temperatures and prolonged drought. Water supply-related risks are defined in the ‘Technical service risks’ subsection. All Krka production sites are located in areas free from flood risk. When upgrading the rainwater drainage system, we accounted for the impact of prolonged, heavy downpours. To minimise storm-related disruptions, we carry out regular maintenance of buildings and surrounding areas. Our high-capacity air conditioning systems ensure stable conditions for uninterrupted production, even during extreme heat. We assess climate change-related risks as low to moderate.
In 2024, we recorded no extraordinary events or incidents that adversely affected the environment. We will ensure compliance with statutory requirements for wastewater discharge from the Krško production site in Slovenia by commissioning our own wastewater treatment plant in the first half of 2025.
Investment project risks primarily include risks related to planning investments and their value, the purchase of equipment, execution of works, and schedules, and risks associated with quality and changes to the original plan. We reduce these risks through document planning and preparation, the established system for selecting contractors and equipment suppliers, and their regular verification. We supervise all execution phases. We review the compliance of project documents from the technical, technological, and regulatory points of view and the compliance of contractual documents from the legal, accounting, and financial aspects. We examine whether potential changes are justified and what impact they could have on costs and schedules. We constantly monitor costs, i.e. regular costs and those incurred by subsequent changes in a project. Regulatory and legal risks also exist, particularly due to potential legislative changes and delays in obtaining necessary permits. We mitigate these risks through reviews of relevant legislation, proactive collaboration with regulatory authorities, and monitoring potential legislative developments.
We place special emphasis on key personnel who are critical to achieving the Krka Group’s objectives and who are highly sought after by our competitors.
We regularly plan and monitor our employees’ training and development while assigning them new work responsibilities, encouraging them to take on new duties, and delegating them to new positions. We schedule employee training and development in our annual training plan, prepared by organisational units in collaboration with Human Resources and Training and Development. The Quality Committee discusses the plan and implementation of Krka’s quality system training twice yearly. Three times a year, the Human Resource Committee discusses the plan and implementation of other training and education programmes, such as part-time studies, Krka International Leadership School, and national vocational qualification programmes. We offer a range of incentives to strengthen employee loyalty to the Krka Group and minimise employee turnover.
We manage the risks associated with the scarcity of qualified professionals in the labour market, especially those with scientific and technical expertise, by actively engaging in the labour market, bolstering Krka’s image as a reputable employer, working with faculties and schools, and awarding scholarships. This allows us to attract new employees essential for delivering successfully on our strategic, development, and sales plans. We mitigate the risk of production staff shortages by maintaining structured work schedules, complying with labour laws, limiting overtime, and investing in industry-specific knowledge within the pharmaceutical sector. We systematically educate and train our employees to acquire national vocational qualification certificates.
The Krka Group manages financial risks centrally in the Finance division of the controlling company in Slovenia. Subsidiaries and representative offices abroad perform risk management operational tasks in accordance with the guidelines set out by the controlling company. Key financial risks include credit, market, liquidity, and insurance-related risks.
The Krka Group’s primary market risk is foreign exchange risk. While we monitor interest rate risk, no measures were taken in 2024 due to low interest rate exposure. The risk of market value fluctuations in raw materials, shares, and bonds has minimal impact on the Krka Group’s net financial result. This is why we track changes in exposure to these risks but do not implement any risk management measures.
The Krka Group operates in diverse international environments and is exposed to foreign exchange risks in certain sales and purchase markets.
Currency exposure arises from the difference in the value of assets and liabilities in a particular currency in the financial position statement of the Group and differences between operating income and expenses generated in individual currencies.
The Russian rouble accounted for the largest, 45%, share of the Krka Group’s currency position at the end of 2024. The rouble’s currency position strengthened compared to the beginning of the year, primarily due to trade receivables in the Russian market and partly due to subsidiary funding in the Russian Federation by the controlling company.
Due to the significance of the Russian market, the level of currency exposure, and the Russian rouble’s volatility, we place a strong focus on managing Russian rouble risk. With the reduced availability of financial instruments, we continued to prioritise natural risk mitigation methods for currency exposure in 2024.
Unlike with other currencies, exposure to the US dollar arises from a surplus of liabilities over assets from regular business operations, or in other words, the currency position is short. Exposure to the US dollar arises primarily from purchasing raw and other materials. Considering liquid financial assets in US dollars and dollar forward contracts that together offset the short financial position from operations, the 2024 year-end exposure to US dollars accounted for 8% of total Krka Group currency exposure.
The exposure to the Romanian leu, accounting for 14% of the currency position at the end of 2024, arises from trade receivables accrued due to extended payment terms in Romania. Exposure to the Polish zloty resulted from trade receivables and manufacturing facilities held by the Group in Poland and accounted for 13% of the currency position. Other currencies, among them the Swedish krona, North Macedonian denar, Kazakh tenge, Serbian dinar, British pound, Czech koruna, Ukrainian hryvnia, and Hungarian forint, accounted for 20% of the Krka Group currency position.
In 2024, currency markets experienced high volatility due to changes in the monetary policies of key central banks. The European Central Bank and the Federal Reserve began a cycle of interest rate cuts in 2024, with the European Central Bank expected to take more aggressive measures. Consequently, the value of the dollar strengthened, with further gains following the US presidential elections due to heightened concerns over protectionist trade policies.
The ongoing geopolitical conflict between Russia and the West continued to impact the value of the Russian rouble in 2024. The rouble’s value in euros remained relatively stable in the first half of 2024 and gradually strengthened. However, in the second half of the year, EUR/RUB exchange rate volatility increased again, and the value of the rouble declined due to additional restrictive measures related to Russian international monetary flows. Monetary authorities in Russia intervened in the foreign exchange market to prevent a significant depreciation of the rouble. The value of the Russian rouble expressed in euros dropped by 15.3% from the beginning to the end of the year and was, on average, 7.9% lower than in 2023.
The value of the US dollar expressed in euros went up by 6.4% over the course of 2024, while the average value remained roughly the same as the previous year. The impact of the US dollar fluctuations on the Krka Group result was offset using financial instruments.
The military conflict and uncertainty surrounding the future economic landscape in Ukraine continued to impact the value of the Ukrainian hryvnia in 2024.
The value of the Polish zloty remained quite stable in 2024 as the EUR/PLN exchange rate fluctuated between 4.25 and 4.35. The strength of the zloty is mainly attributed to strong economic growth in Poland, high real interest rates, and optimistic economic forecasts for 2025. Over the course of 2024, the value of the Polish zloty increased by 1.5%, and the average value was 5.5% higher than in 2023.
Throughout 2024, the Romanian leu and the Czech koruna remained highly stable. The value of the Hungarian forint declined, mainly due to uncertainty surrounding economic growth.
The Krka Group generally mitigates currency risks by natural hedging, primarily by increasing purchases and liabilities in currencies used for sales invoicing. When this is not feasible, we use financial instruments or choose not to hedge the risk. Generally, we rely exclusively on forward contracts for hedging.
In 2024, we continued to hedge the US dollar with financial instruments. We used natural hedging to mitigate the risk of exposure to the Russian rouble as there were no suitable financial instruments in the banking market. Due to the declining value of the Russian rouble expressed in euros, we generated net foreign exchange losses.
The increasing US dollar exposure from operations and the interest rate difference between the euro and the US dollar that is favourable for Krka are two key reasons that contributed to hedging the exposure in the US dollar with financial instruments in 2024. Due to the increased value of the US dollar in euros, the impact of instruments used to hedge short dollar positions on the Krka Group’s net financial result was positive.
The impact of other currencies to the final net exchange differences was negative, but in a low amount. We did not hedge the risks of other currencies with financial instruments.
The Krka Group’s currency exposure to the Ukrainian hryvnia, Kazakh tenge, Serbian dinar, and certain other currencies is less significant, and no hedging instruments are available.
Currency risk results, which included net exchange differences and derivative income and expenses, amounted to a loss of €22.9 million in 2024. The Krka Group recorded a total net financial loss of €8.5 million, which includes currency risk result, interest income and expenses, and other financial income and expenses.
| Exchange rate | 31Dec 2023 (€) | Exchange rate | 31Dec 2024 (€) | Low (€) | High (€) | Average (€) | Standard deviation | Coefficient of variation* |
|---|---|---|---|---|---|---|---|---|
| RUB | 99.97 | 118.01 | 90.16 | 118.99 | 100.41 | 4.80 | 4.8% | |
| RON | 4.98 | 4.97 | 4.96 | 4.98 | 4.97 | 0.00 | 0.1% | |
| PLN | 4.34 | 4.28 | 4.25 | 4.40 | 4.31 | 0.03 | 0.8% | |
| CZK | 24.72 | 25.19 | 24.49 | 25.46 | 25.12 | 0.24 | 0.9% | |
| HUF | 382.80 | 411.35 | 377.65 | 416.05 | 395.30 | 8.52 | 2.2% | |
| UAH | 41.99 | 43.44 | 40.36 | 46.17 | 43.41 | 1.56 | 3.6% | |
| RSD | 117.08 | 116.83 | 116.71 | 117.15 | 116.95 | 0.08 | 0.1% |
The interest rate risk is a probability that, due to fluctuations in reference market interest rates, the Krka Group might incur higher financing costs from non-current borrowings or report a decrease in income from non-current investments. The interest rate risk related to current borrowings and current investments is managed as part of the Group’s liquidity risk. The Krka Group had no non-current borrowings in 2024.
If we secure non-current borrowings or make non-current investments that expose us to interest rate risk, we will evaluate all available options to mitigate the risk using appropriate financial instruments.
Business partners value Krka for its excellent financial discipline and stable cash flows. In 2024, we settled all financial liabilities regularly. Krka Group exposure to liquidity risk was low last year. We did not use any new short-term funding from banks or draw funds from existing credit lines in 2024.
At the end of 2024, the Krka Group recorded cash and cash equivalents primarily as cash at bank or short-term deposits with a maturity of up to 90 days at first-class commercial banks. Other current liquid assets were held in short-term treasury bills issued by western European countries with first-class credit ratings.
In 2024, the world’s major central banks began lowering key interest rates. The Krka Group recorded favourable returns on cash, cash equivalents, and low-risk liquid investments, leading to higher interest income and income from other financial instruments.
The Krka Group oversees liquid assets in line with internal investment diversification rules, taking into account factors such as interest rate, liquidity, credit, and currency risks. The controlling company manages liquidity risk centrally for the entire Krka Group. The controlling company finances subsidiaries through intra-group loans. Any potential excess cash is deposited with the controlling company. Excess cash from all Group companies is transferred to the controlling company’s master account either automatically daily (cash pooling) or manually through individual bank transfers. This allows for cash management optimisation, currency risk mitigation, an overview of the liquidity of all Group companies, and enhanced security of money transactions.
The Krka Group also reported favourable and stable liquidity ratios at the end of 2024.
| Year | 2024 | 2023 | 2022 | 2021 | 2020 | 5-year average |
|---|---|---|---|---|---|---|
| Current ratio | 4.07 | 3.93 | 3.75 | 3.21 | 4.00 | 3.79 |
| Quick ratio | 2.65 | 2.54 | 2.42 | 2.21 | 2.54 | 2.47 |
| Acid test ratio | 1.33 | 1.11 | 1.37 | 0.69 | 1.04 | 1.11 |
| Receivables turnover ratio | 3.34 | 3.65 | 3.70 | 3.45 | 3.50 | 3.53 |
Quick ratio = (Current assets – Inventories)/Current liabilities
Acid test ratio = (Investments + Cash and cash equivalents)/Current liabilities
In 2025, we plan to carefully manage cash flows and excess liquidity across the Krka Group to ensure optimal liquidity for all Group companies.
The Krka Group’s key credit risk stems from trade receivables. This is the risk of customers failing to settle their liabilities by their maturity dates.
The Krka Group introduced a centralised credit control process in 2004. The system includes all customers with credit limits exceeding €20,000. Numbering over 600 at the end of 2024, they accounted for more than 95% of total trade receivables. Receivables due from small customers accounted for less than 5% of total trade receivables. Credit control for small customers is decentralised within the sales network and remains under the constant supervision of the controlling company.
Credit control is a two-step process. The first step involves assessing the credit risk for each customer, determining hedging instruments, and assigning relevant credit limits. We assess each new customer and review the credit ratings of all customers twice a year. A customer’s credit rating includes many financial and non-financial indicators, which fall into four categories; each has a different weight in the final assessment.
| 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|
| 4.00 | 3.21 | 3.75 | 3.93 | 4.07 |
| 2.54 | 2.21 | 2.42 | 2.54 | 2.65 |
| 1.04 | 0.69 | 1.37 | 1.11 | 1.33 |
Current ratio Quick ratio Acid test ratio
Each customer is assigned a customised credit limit according to the credit rating, expected shipment, and payment dynamics.
The second stage of the credit-control process entails ongoing dynamic monitoring of a customer’s payment history. All Krka subsidiaries engaged in sales employ information systems to manage available credit limits and track overdue receivables each time a product is shipped. A shipment is automatically blocked if a customer is in arrears or if receivables together with the new shipment exceed the approved credit limit. Sales personnel are required to initiate a payment collection procedure or arrange hedging for the outstanding settlements.
Krka’s internal rules define the credit control process and authorisation procedures for granting customer credit limits. The credit control system also includes regular reporting on trade receivables and customer payment discipline. The reporting system enables the early detection of customers at a higher risk of payment default and facilitates effective credit risk management.
The credit control process employs uniform rules applicable to all customers. Due to the unique characteristics of sales markets, additional local controls have been introduced in individual subsidiaries. Credit control processes are regularly adjusted to reflect changes in sales markets.
Credit control guarantees continuous monitoring of the quality of the trade receivables portfolio, resulting in a low percentage of receivable write-offs and impairments relative to total Krka Group sales.
The low level of receivable write-offs and impairments is also attributed to the broad distribution of receivables across numerous customers and sales markets. Additionally, the majority of outstanding receivables are from longstanding Krka customers.
In 2024, we continued with our trade receivable management efforts, placing special focus on challenging markets. As a result, our credit risk management outcomes for 2024 were favourable. By year-end, the value of trade receivables increased by 9% compared to the beginning of the year, while the level of overdue and outstanding receivables remained within limits acceptable for Krka.
In 2024, the impact of net impairments and write-offs of receivables on the Krka Group’s bottom line amounted to less than 0.12% of sales.
| 30% | 20% | 35% | 15% |
|---|---|---|---|
Since 2009, the Krka Group has insured part of its trade receivables with a credit insurance company. In the second quarter of 2020, we extended and supplemented trade receivable insurance. At the end of 2024, more than 95% of trade receivables were insured. After deductibles, more than 85% of trade receivables were insured. Bank guarantees and letters of credit are used only in exceptional cases to secure payments.
The structure of receivables by sales region remained stable, aligning with the structure of sales and payment terms in individual countries.
| Trade receivables by region | 31 Dec 2020 | 31 Dec 2021 | 31 Dec 2022 | 31 Dec 2023 | 31 Dec 2024 |
|---|---|---|---|---|---|
| Uninsured receivables | 9 | 12 | 12 | 13 | 13 |
| Receivables insured with insurance company or bank | 76 | 80 | 79 | 97 | 104 |
| Total Receivables | 168 | 241 | 144 | 212 | 246 |
| Year | Uninsured receivables | Receivables insured |
|---|---|---|
| 2020 | 3 | 5 |
| 2021 | 6 | 6 |
| 2022 | 8 | 0 |
| 2023 | 50 | 100 |
| 2024 | 150 | 200 |
The maturity structure of receivables remained stable. The percentage of overdue receivables remained low at the end of 2024 compared to total trade receivables.
| € million | Region Slovenia | Region South-East Europe | Region East Europe | Region Central Europe | Region West Europe | Region Overseas Markets |
|---|---|---|---|---|---|---|
| 2020 | 375 | 457 | 394 | 481 | 536 | 4 |
| 2021 | 7 | 7 | 21 | 13 | 2 | 2 |
| 2022 | 0 | 4 | 1 | 1 | 0 | 1 |
| 2023 | 1 | 1 | 1 | 1 | 1 | 1 |
| 2024 | 1 | 0 | 50 | 100 | 150 | 200 |
In 2025, we will continue established credit risk management activities. The insurance contract for our trade receivables expires at the beginning of 2026. Before contract renewal, we plan to examine options for further optimising receivables insurance. As before, we plan to redouble our monitoring of customers from markets with less favourable macroeconomic landscapes and those markets where we have identified heightened risks in the wholesale distribution of medicines. If we determine that individual customer exposure exceeds acceptable levels, we will implement targeted measures to gradually reduce this exposure.
We aim to keep receivable impairments and write-offs at a minimal level across the Krka Group.
The Krka Group holds insurance policies with insurance companies to insure property, liabilities, and financial losses in the event of a business interruption. Insurance is only one of the risk management tools. Our internal Insurance Policy defines types of insurance and their characteristics.
Decisions on insurance type and scope of coverage are made based on risk materiality and insurance cost considerations. The materiality of risks is assessed based on estimated probability, potential damage severity, and the impact on operations. The Krka Group prioritises preventive measures, as they provide a more effective risk management strategy than relying solely on insurance policies. One of the reasons for taking out insurance could be legislation requiring specific types of insurance.
The Krka Group tailors its insurance scope and coverage to align with business growth, property value, and conditions in the international insurance markets. We also take into account the wider community’s interests and those of our stakeholders, for example, in areas such as environmental liability insurance or product liability insurance.
Key insurance policies taken out by the Krka Group to manage risks include insurance for property, general civil liability, manufacturer’s liability, clinical trials, product recalls, freight-in-transit, and business interruption. Insurance policies also indicate the main risks, including property protection, especially against disasters (fire, earthquake, flood, storm, explosion), business interruption at manufacturing plants, and product and other liabilities.
We continued to acquire new partners from the international insurance market in 2024 to improve our insurance programme. Krka makes gradual improvements every year and simultaneously assumes part of the risk through insurance deductibles or by cancelling low-risk insurance policies. Three insurance audits were conducted in the Krka Group last year, with no critical recommendations made.
Krka has been investing systematically in damage prevention. Our buildings are designed to minimise hazard exposure. They are equipped with active fire safety systems, including fire and smoke alarms, sprinkler systems, fire flaps, and emergency lighting. Regular preventive inspections and fire drills are arranged, and employees receive theoretical and practical emergency response training.
In recent years, planned preventive measures and appropriate insurance policies have effectively minimised property damage, and it remains low.
The graph does not include car or personal insurance.
| 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|
| 0 | 25 | 2 | 16 | 0 |
| 5 | 10 | 15 | 20 | 25 |
Krka share price on the Ljubljana Stock Exchange
| Year | Year high | Year low | 31 December | Annual change (%) |
|---|---|---|---|---|
| 2024 | 149.50 | 110.00 | 139.00 | 26.4 |
| 2023 | 118.50 | 91.60 | 110.00 | 19.6 |
| 2022 | 120.00 | 80.80 | 92.00 | -22.0 |
| 2021 | 120.00 | 91.20 | 118.00 | 29.1 |
| 2020 | 92.60 | 54.00 | 91.40 | 24.9 |
In 2024, the Krka share price increased by just over 26%.
Reference: The Ljubljana Stock Exchange and S&P Dow Jones Indices LLC
The Annual General Meeting (AGM) decides on the proposed dividend amount. In 2024, we allocated 73.6% of the consolidated net profit attributable to equity holders of the controlling company generated in 2023 for the dividend payout. Gross dividend per share increased by 13.6%. The Company adheres to its long-term dividend policy when determining the net profit share for dividend payouts each year. At least 50% of the net profit of the controlling company’s majority equity holders is allocated for dividends. The Group’s financial requirements for investments and potential acquisitions are also taken into account.
| 60 | 80 | 100 | 120 | 140 | 160 | 180 | 200 | 220 |
|---|---|---|---|---|---|---|---|---|
Index
| 2024 | 2023 | 2022 | 2021 | 2020 | |
|---|---|---|---|---|---|
| Earnings per share (€) | 11.60 | 10.14 | 11.69 | 9.92 | 9.27 |
| Gross dividend per share (€) | 7.50 | 6.60 | 5.63 | 5.00 | 4.25 |
| Dividend payout ratio (%) | 73.6 | 56.3 | 56.6 | 53.6 | 54.3 |
| Dividend yield (%) | 5.4 | 6.0 | 6.1 | 4.2 | 4.6 |
1 Net profit for the year attributable to majority equity holders of the controlling company/Average number of shares issued in the period, excluding treasury shares
2 Dividends paid for the previous period per the AGM resolution
3 Total dividends paid/Consolidated net profit attributable to majority equity holders of the controlling company
4 Gross dividend per share/Share price as at 31 December
Krka shares are listed on the prime market of the Ljubljana Stock Exchange. Since April 2012, they have been dual-listed on the Warsaw Stock Exchange. All Krka shares traded on the Ljubljana and Warsaw stock exchanges are of the same class: ordinary and freely transferable. Each share, except treasury shares, carries one vote at the AGM. Krka shares are traded freely through brokerage houses and banks that are members of the Ljubljana or Warsaw stock exchanges.
Reference: Ljubljana Stock Exchange
Krka shares are the most traded security on the Ljubljana Stock Exchange. In 2024, the average daily trading volume of Krka shares on the Ljubljana Stock Exchange reached €0.67 million or 5,088 shares, including blocks.
| 30 | 40 | 50 | 60 | 70 | 80 | 90 | 100 | 110 | 120 | 130 | 140 | 150 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 0 | 1,000 | 2,000 | 3,000 | 4,000 | 5,000 | 6,000 | 7,000 | 8,000 | 9,000 | 10,000 | 11,000 | 12,000 |
| 31 Dec 2019 | 31 Dec 2020 | 31 Dec 2021 | 31 Dec 2022 | 31 Dec 2023 | 31 Dec 2024 |
| Shares owned | Stake (%) | |
|---|---|---|
| Kapitalska družba, d. d. | 3,493,030 | 10.65 |
| Slovenski državni holding, d. d. (SDH) | 2,949,876 | 9.00 |
| Republic of Slovenia | 2,366,141 | 7.22 |
| OTP banka, d. d. | 1,533,267 | 4.68 |
| Erste Group Bank AG | 1,238,081 | 3.78 |
| Clearstream Banking SA | 1,101,675 | 3.36 |
| Luka Koper, d. d. | 433,970 | 1.32 |
| Privredna banka Zagreb d.d. | 363,108 | 1.11 |
| State Street Bank and Trust | 289,755 | 0.88 |
| Citibank N.A. | 211,608 | 0.65 |
| Total | 13,980,511 | 42.63 |
The shares are held in custody accounts with the above-listed banks and are owned by their clients.
At the end of 2024, Krka had 47,243 shareholders.
Reference: KDD
In 2024, the Company acquired 191,371 treasury shares valued at €24,962 thousand on the regulated market (€25,002 thousand including repurchase costs) and held 2,107,337 treasury shares as at 31 December 2024.
We adhere to the highest standards in conducting our business, which also extends to investor relations. We pursue corporate integrity, high levels of transparency in reporting, and engagement of shareholders, analysts, and financial professionals. We regularly informed the financial and general public about our business achievements throughout the year in compliance with valid regulations and stock exchange reporting rules. We provided them with information mainly related to our business results and the Krka Group’s strategy, complying with the information disclosure policy. Investors and financial analysts gave us feedback, which we carefully examined and presented to our Management Board.
In 2024, we participated in 13 investment conferences with investors from more than 15 countries. We organised four webcasts to present our quarterly business results. The Ljubljana Stock Exchange presented Krka with the Best Investor Relations Award for 2024.
| 38.2 | 38.8 | 40.4 | 41.1 | 41.5 | 27.1 | 27.1 | 27.1 | 27.1 | 27.0 | 6.8 | 6.8 | 6.1 | 5.5 | 5.4 | 4.7 | 5.1 | 5.5 | 5.8 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 31 Dec 2020 | 31 Dec 2021 | 31 Dec 2022 | 31 Dec 2023 | 31 Dec 2024 |
|---|---|---|---|---|
| Domestic retail investors | 23.2 | 22.2 | 20.9 | 20.5 |
| State ownership | 19.7 | |||
| Domestic legal entities and institutional investors | ||||
| Treasury shares | ||||
| Foreign investors |
Krka’s business results are available in Slovenian and English on SEOnet (http://seonet.ljse.si) of the Ljubljana Stock Exchange, ESPI of the Warsaw Stock Exchange, and Krka’s website.
Revenue
In 2024, the Krka Group generated revenue of €1,909.5 million, a €103.2 million or 6% increase on 2023, of which revenue from contracts with customers on sales of products and services reached €1,899.8 million and revenue from contracts with customers on sales of materials and other sales revenue constituted the difference. Five year compound average growth rate of sales volume was 4.3% and of sales value was 5%.
In 2024, Krka (in this section referred to as ‘the Company’ for clarity reasons) generated revenue of €1,766.0 million, of which revenue from contracts with customers on sales of products amounted to €1,538.6 million; revenue from contracts with customers on sales of materials totalled €216.7 million; and other revenue from sales reached €10.8 million; up €91.4 million or 5% on 2023.
Krka Group operating expenses totalled €1,489.1 million, up €76.2 million or 5% on 2023. The Company incurred operating expenses of €1,383.2 million, up 2% on 2023.
Krka Group operating expenses comprised: cost of goods sold of €815.7 million; selling and distribution expenses of €373.4 million; R&D expenses of €184.9 million; and general and administrative expenses of €115.2 million. Operating expenses accounted for 78% of sales revenue and, over the past five years, ranged from 75% in 2020 to 78% between 2021 and 2024.
Cost of goods sold, up 5% on 2023, represented the largest item in the Krka Group operating expense structure. They accounted for 42.7% of total revenue in 2024, and 43.2% in 2023. Selling and distribution expenses increased by 7% compared to 2023, and accounted for 19.6% of total revenue, up 0.3 percentage points on 2023. R&D expenses increased by 4% and accounted for 9.7% of total revenue (down 0.2 percentage points on 2023). General and administrative expenses amounted to 6.0% of total revenue, up 8%, while their proportion in revenue increased by 0.1 percentage point.
| 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|
| 1,447 | 1,381 | 1,554 | 1,675 | 1,766 |
| 1,535 | 1,566 | 1,717 | 1,806 | 1,910 |
0
200
400
600
800
1,000
1,200
1,400
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€ million
Company Krka Group
Company operating expenses comprised: costs of goods sold of €782.3 million; selling and distribution expenses of €321.4 million; R&D expenses of €179.8 million; and general and administrative expenses of €99.7 million. Costs of goods sold accounted for the largest Company operating expense item and remained at the 2023 level. They accounted for 44.3% of total revenue, a 2.6 percentage points decrease on 2023. Selling and distribution expenses increased by 7% compared to 2023, and accounted for 18.2% of total revenue, up 0.2 percentage points on 2023. R&D expenses constituted 10.2% of total revenue (down 0.2 percentage points on 2023) and increased by 3%. General and administrative expenses accounted for 5.6% of total revenue, up 7%, while their share of total revenue remained unchanged from 2023.
| € thousand | Krka Group | Company |
|---|---|---|
| 2024 | ||
| 2023 | ||
| 2022 | ||
| 2021 | ||
| 2020 | ||
| 2024 | ||
| 2023 |
| 2022 | 2021 | 2020 | |
|---|---|---|---|
| Financial income | 33,946 | 23,567 | 57,668 |
| Financial expenses | –42,440 | –56,062 | –5,806 |
| Net financial result | –8,494 | –32,495 | 51,862 |
In 2024, the Krka Group recorded a net financial loss of €8.5 million, and the Company recorded a net financial loss of €5.0 million.
Operating in diverse international environments, the Krka Group is subject to foreign exchange risks in specific sales and procurement markets. The Krka Group currency risk generated a loss of €22.9 million in 2024. Please see in Financial reports under ‘Notes to the consolidated financial statements’ (‘29. Financial Instruments and Financial Risks’) for details about foreign exchange risks.
Krka Group financial income comprised: interest income of €14.1 million; derivative income of €10.1 million; income from other financial instruments of €9.0 million; and dividend income of €0.8 million. Financial expenses comprised: net foreign exchange differences of €31.3 million; derivative expense of €1.7 million; interest expense of €0.5 million; and other financial expenses of €9.0 million.
Company financial income comprised: interest income of €10.6 million; derivative income of €10.1 million; income from other financial instruments of €9.0 million; income from dividends and other profit shares of €5.3 million. Financial expenses comprised: net foreign exchange differences of €30.5 million; derivative expense of €1.7 million; interest expense of €3.5 million; and other financial expenses of €4.4 million.
Operating profit (EBIT) and net profit for the year
The Krka Group recorded EBIT totalling €427.6 million, up €28.0 million or 7% on 2023. The Krka Group posted EBITDA totalling €520.1 million, up €15.9 million or 3%.
The Company generated EBIT of €386.0 million, while its EBITDA reached €457.2 million.
In 2024, Krka Group profit before tax increased by €52.0 million or 14% to €419.1 million. The effective tax rate for the Krka Group was 15.0%. Company profit before tax amounted to €381.0 million.
The Krka Group recorded net profit of €356.2 million, up €42.5 million or 14% on 2023. Year-on-year growth in profit before tax and net profit was driven by a relatively modest increase in costs compared to revenue growth and a reduction in financial losses from the year before. The Company’s net profit totalled €321.2 million.
| € thousand | Krka Group | Company |
|---|---|---|
| 31 Dec 2024 | % | % |
| 31 Dec 2023 | % | % |
| Index | 31 Dec 2024 | % |
| Assets | 1,022,901 | 35.9 | |
|---|---|---|---|
| 1,059,267 | 38.3 | ||
| 97 | 1,044,180 | 39.8 | |
| 1,076,235 | 41.2 | ||
| 97 | Property, plant and equipment (PP\&E) | 806,646 | 28.3 |
| 790,345 | 28.6 | ||
| 102 | 609,628 | 23.2 | |
| 595,525 | 22.8 | ||
| 102 | Intangible assets | 100,747 | 3.5 |
| 102,348 | 3.7 | ||
| 98 | 25,026 | 1.0 | |
| 26,043 | 1.0 | ||
| 96 | Investments and loans | 59,846 | 2.1 |
| 117,772 | 4.2 | ||
| 51 | 403,181 | 15.4 | |
| 446,181 | 17.1 | ||
| 90 | Other | 55,662 | 2.0 |
| 48,802 | 1.8 | ||
| 114 | 6,345 | 0.2 | |
| 8,486 | 0.3 | ||
| 75 | Current assets | 1,826,120 | 64.1 |
| 1,705,024 | 61.7 | ||
| 107 | 1,577,456 | 60.2 | |
| 1,537,636 | 58.8 | ||
| 103 | Inventories | 638,608 | 22.4 |
| 604,621 | 21.9 | ||
| 106 | 548,188 | 20.9 | |
| 513,892 | 19.7 | ||
| 107 | Trade receivables | 552,710 |
At the end of 2024, Krka Group assets were valued at €2,849.0 million, up €84.7 million or 3% on year-end 2023. The ratio of non-current to current assets in the overall asset structure differed from that recorded at year-end 2023, as non-current assets decreased by 2.4 percentage points and totalled 35.9%.
At the end of 2024, Company assets were valued at €2,621.6 million, on a par with the 2023 figure. The ratio of non-current to current assets in the overall asset structure differed from that recorded at year-end 2023, as non-current assets decreased by 1.4 percentage points to 39.8%.
Krka Group non-current assets were valued at €1,022.9 million, a €36.4 million or 3% decrease on year-end 2023. The most significant item in the Krka Group asset structure was property, plant and equipment (PP&E). It was valued at €806.6 million and accounted for 28.3% of total Krka Group assets (of which Company PP&E accounted for €609.6 million or 76% of total Krka Group PP&E). Intangible assets totalled €100.7 million and accounted for 3.5% of total assets (of which Company assets accounted for €25.0 million or 25% of total Krka Group intangible assets). Krka Group non-current loans totalled €35.3 million or 1.2% of total Krka Group assets.
Current assets were valued at €1,826.1 million, a €121.1 million or 7% increase on year-end 2023. Inventories amounted to €638.6 million or 22.4% of total Krka Group assets. Trade receivables totalled €552.7 million, accounting for 19.4% of total Krka Group assets. Inventories increased by €34.0 million or 6%. Trade receivables increased by €43.6 million or 9%. Krka Group current loans amounted to €10.5 million or 0.4% of its total assets.
| 19.4 | 509,070 | 18.4 | 109 | 518,425 | 19.8 | 463,126 | 17.7 | 112 |
|---|---|---|---|---|---|---|---|---|
| Other | 634,802 | 22.3 | 591,333 | 21.4 | 107 | 510,843 | 19.5 | 560,618 |
| Total assets | 2,849,021 | 100.0 | 2,764,291 | 100.0 | 103 | 2,621,636 | 100.0 | 2,613,871 |
| 100 | 339 | 273 | 358 | 322 | 386 | 258 | 245 | 348 |
| 294 | 321 | 391 | 355 | 381 | 400 | 428 | 289 | 308 |
| 364 | 314 | 356 | 0 | 50 | 100 | 150 | 200 | 250 |
| 300 | 350 | 400 | 450 | 2020 | 2021 | 2022 | 2023 | 2024 |
€ million
loss totalled €224.1 million and were made into treasury bills of the EU Member States with high credit ratings. Cash and cash equivalents were valued at €344.9 million, up €170.9 million on year-end 2023, accounting for 12.1% of total Krka Group assets. The increase primarily entailed a €86.4 million deposit with maturity of up to 90 days.
Company non-current assets were valued at €1,044.2 million, a €32.1 million or a 3% decrease on year-end 2023. The most significant item in the Company asset structure was property, plant and equipment (PP&E). It was valued at €609.6 million or 23.3% of total Company assets. Investments in subsidiaries totalled €355.3 million or 13.6% of total Company assets. Intangible assets of €25.0 million accounted for 1.0% of total assets. Company non-current loans totalled €23.4 million or 0.9% of total Company assets.
Company current assets were valued at €1,577.5 million and increased by €39.8 million or 3% on year-end 2023. Inventories totalled €548.2 million, accounting for 20.9% of total Company assets; and trade receivables €518.4 million or 19.8% of Company assets, of which receivables due from customers other than Krka Group companies amounted to €215.3 million. Inventories increased by 7%, and trade receivables by 12%. Company current loans totalled €9.0 million or 0.3% of its total assets. Investments at fair value through profit or loss totalled €224.1 million and were made into treasury bills of the EU Member States with high credit ratings. Cash and cash equivalents were valued at €238.2 million, up €97.2 million on year-end 2023, accounting for 9.1% of total Company assets. The increase was primarily driven by a €86.4 million deposit with a maturity of up to 90 days.
| € thousand | Krka Group | Company | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 31 Dec 2024 | % | 31 Dec 2023 | % | Index | 31 Dec 2024 | % | 31 Dec 2023 | % | Index | ||
| Equity | 2,237,784 | 78.6 | 2,181,766 | 78.9 | 103 | 2,186,351 | 83.4 | 2,133,258 | 81.6 | 102 | |
| Non-current liabilities | 162,662 | 5.7 | 149,218 | 5.4 | 109 | 130,433 | 5.0 | 118,930 | 4.6 | 110 | |
| Current liabilities | 448,575 | 15.7 | 433,307 | 15.7 | 104 | 304,852 | 11.6 | 361,683 | 13.8 | 84 | |
| Total equity and liabilities | 2,849,021 | 100.0 | 2,764,291 | 100.0 | 103 | 2,621,636 | 100.0 | 2,613,871 | 100.0 | 100 |
The Krka Group recorded provisions of €136.9 million (of which post-employment and other non-current employee benefits accounted for €128.8 million; provisions for lawsuits €7.6 million; and other provisions €0.5 million), up €12.5 million or 10% on year-end 2023. Provisions for post-employment and other non-current employee benefits increased by €15.5 million; provisions for lawsuits decreased by €3.0 million; while other provisions remained unchanged.
Of Krka Group current liability items, trade payables decreased by €5.5 million (of which payables to domestic suppliers decreased by €7.2 million and payables to foreign suppliers increased by €1.7 million). Current liabilities from contracts with customers increased by €3.9 million (of which bonuses and volume rebates increased by €6.8 million and right of return by €0.1 million, while contract liabilities decreased by €3.0 million). Other current liabilities increased by €1.2 million, (of which payables to employees increased by €3.5 million; derivative liabilities decreased by €2.7 million; and other liabilities increased by €0.4 million).
As at 31 December 2024, the Company posted equity of €53.1 million, up 2% on year-end 2023. The increase was attributable to Company net profit totalling €321.2 million. Equity was reduced by dividends paid totalling €230.9 million; a repurchase of treasury shares totalling €25.0 million; and other comprehensive income after tax totalling €12.2 million.
Company provisions amounted to €125.7 million (of which post-employment and other non-current employee benefits totalled €118.3 million and provisions for lawsuits €7.4 million). Compared to the end of 2023, they increased by €11.7 million or 10%, primarily due to a €14.8 million rise in provisions for post-employment and other non-current employee benefits. Provisions for lawsuits decreased by €3.1 million.
Of Company current liability items, trade payables decreased by €4.7 million. Current liabilities from contracts with customers decreased by €0.8 million, while other current liabilities increased by €1.3 million. At the end of 2024, the Company recorded current borrowings from subsidiaries totalling €17.6 million.
| € thousand | Krka Group | Company | ||
|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | |
| Net cash flow from operating activities | 360,933 | 227,254 | 320,519 | 155,399 |
| Net cash flow from investing activities | 75,094 | –343,235 | 107,941 | –296,529 |
| Net cash flow from financing activities | –264,548 | –229,822 | –330,864 | –188,159 |
| Net change in cash and cash equivalents | 171,479 | –345,803 | 97,596 | –329,289 |
Net change in Krka Group cash and cash equivalents (exclusive of exchange rate fluctuations) yielded €171.5 million in 2024, because the positive cash flows from operating and investing activities outstripped the negative cash flow from financing activities.
The Krka Group generated profit from operating activities before changes in net current assets totalling €489.7 million. Changes in current assets that had a positive impact on cash flow consisted of changes in deferred revenue and other current liabilities, while changes in trade receivables, inventories, trade payables, and provisions had a negative impact. The decrease in net cash flow from operating activities was further impacted by income tax paid.
Positive cash flows from investing activities of €75.1 million were primarily generated by proceeds from the sale of non-current investments of €71.2 million; current investments of €477.2 million; and net proceeds from current loans of €55.5 million. Payments of dividends and other profit shares totalling €230.9 million and treasury share repurchases of €25.0 million contributed the most to negative cash flows from financing activities in total of €264.5 million.
Krka Group and Company operating figures for the past five years
| € thousand | Krka Group | Company | ||||
|---|---|---|---|---|---|---|
| 2024 | 2023 | 2022 | 2021 | 2020 | ||
| Revenue | 1,909,544 | 1,806,391 |
| Year | EBITDA | Profit Margin | EBIT | Profit Margin | Net Profit | Profit Margin | Assets |
|---|---|---|---|---|---|---|---|
| 1 | 1,717,453 | 27.2% | 427,572 | 22.4% | 356,202 | 18.7% | 2,849,021 |
| 2 | 1,565,802 | 27.9% | 399,621 | 22.1% | 313,732 | 17.4% | 2,764,291 |
| 3 | 1,534,941 | 28.5% | 381,211 | 22.2% | 363,662 | 21.2% | 2,687,500 |
| 4 | 1,766,021 | 29.6% | 354,788 | 22.7% | 308,150 | 19.7% | 2,536,988 |
| 5 | 1,674,572 | 32.7% | 390,744 | 25.5% | 288,949 | 18.8% | 2,235,542 |
| 6 | 1,553,514 | 25.9% | 385,997 | 21.9% | 321,192 | 18.2% | |
| 7 | 1,381,367 | 24.0% | 322,308 | 19.2% | 294,481 | 17.6% | |
| 8 | 1,447,112 | 28.3% | 357,870 | 23.0% | 348,215 | 22.4% | |
| 9 | 25.9% | 273,325 | 19.8% | 245,216 | 17.8% | ||
| 10 | 29.3% | 338,882 | 23.4% | 258,474 | 17.9% |
| 2,621,636 | 2,613,871 | 2,516,544 | 2,427,245 | 2,208,379 |
|---|---|---|---|---|
| 3 | 12.7% | 11.5% | 13.9% | 12.9% | 13.1% | 12.3% | 11.5% | 14.1% | 10.6% | 11.9% |
|---|---|---|---|---|---|---|---|---|---|---|
| 2,237,784 | 2,181,766 | 2,138,509 | 1,919,085 | 1,751,812 |
|---|---|---|---|---|
| 4 | 16.1% | 14.5% | 17.9% | 16.8% | 16.9% | 14.9% | 14.0% | 17.7% | 13.4% | 15.0% |
|---|---|---|---|---|---|---|---|---|---|---|
| 0 | 5 | 10 | 15 | 20 | 25 | 30 |
|---|---|---|---|---|---|---|
| EBITDA margin | 25.9 | 21.9 | 18.2 | 14.9 | 12.3 | |
| EBIT margin | 27.9 | 22.1 | 17.4 | 14.5 | 11.5 | |
| Net profit margin | 27.2 | 22.4 | 18.7 | 16.1 | 12.7 |
Revenue from contracts with customers on sales of products and services amounted to €1,899.8 million, while other revenue from contracts with customers on sales of materials and other sales revenue constituted the difference. Sales in markets outside Slovenia totalled €1,778.8 million, accounting for 94% of overall Krka Group sales. Product sales volume increased by 2%.
Region East Europe recorded the highest sales, €650.3 million or 34.2% of total Krka Group sales. Region Central Europe achieved the second highest sales, totalling €426.5 million or 22.4% of total Krka Group sales. Region West Europe ranked third in sales with €351.8 million or 18.5% of total Krka Group sales. Sales generated by Region South-East Europe totalled €269 million or 14.2% of total sales, and Region Overseas Markets €81.1 million or 4.3% of total sales. Region Slovenia generated sales of €121 million, accounting for 6.4% of total Krka Group sales.
| Krka Group | Company | |||||||
|---|---|---|---|---|---|---|---|---|
| € thousand | 2024 | 2023 | 2024/23 Index | 2024 | 2023 | 2024/23 Index | ||
| Region Slovenia | 121,004 | 113,777 | 106 | 71,658 | 66,087 | 108 | ||
| Region South-East Europe | 269,025 | 249,330 | 108 | 263,169 | 246,512 | 107 | ||
| Region East Europe | 650,339 | 593,951 | 109 | 423,528 | 376,988 | 112 | ||
| Region Central Europe | 426,530 | 397,079 | 107 | 407,341 | 380,775 | 107 | ||
| Region West Europe | 351,803 | 369,624 | 95 | 308,895 | 319,539 | 97 | ||
| Region Overseas Markets | 81,147 | 75,208 | 108 | 63,985 | 59,838 | 107 | ||
| Total | 1,899,848 | 1,798,969 | 106 | 1,538,576 | 1,449,739 | 106 |
6.4%
14.2%
34.2%
22.4%
18.5%
4.3%
| Region | 2024 Q1 | 2024 Q2 | 2024 Q3 | 2024 Q4 | 2023 Q1 | 2023 Q2 | 2023 Q3 | 2023 Q4 |
|---|---|---|---|---|---|---|---|---|
| Region Slovenia | 30,124 | 29,787 | 31,982 | 29,111 | 28,077 | 28,558 | 30,043 | 27,099 |
| Region South-East Europe | 69,100 | 68,342 | 64,185 | 67,398 | 63,526 | 63,923 | 59,747 | 62,134 |
| Region East Europe | 156,422 | 176,023 | 151,852 | 166,042 | 143,493 | 156,984 | 133,606 | 159,868 |
| Region Central Europe | 116,797 | 110,775 | 100,981 | 97,977 | 110,262 | 102,646 | 92,105 | 92,066 |
| Region West Europe | 92,773 | 91,145 | 80,620 | 87,265 | 91,744 | 89,616 | 85,039 | 103,225 |
| Region Overseas Markets | 18,888 | 20,662 | 17,056 | 24,541 | 19,151 | 18,491 | 17,870 | 19,696 |
| Total | 484,104 | 496,734 | 446,676 | 472,334 | 456,253 | 460,218 | 418,410 | 464,088 |
In 2024, product sales were valued at €71.7 million, up 8%. Prescription pharmaceuticals accounted for the majority of that or 74%. Non-prescription products accounted for 23%, and sales of animal health products made up the remaining 3%. Holding a 7.3% market share, we remained the leading pharmaceutical provider in Slovenia by sales value. Health resort and tourist services generated €49.4 million, up 3% year-on-year, contributing 6% to sales growth in the domestic market.
The highest sales in prescription pharmaceuticals were generated by medicines for treating cardiovascular diseases, gastrointestinal tract and central nervous system disorders, and pain relief. We raised the visibility of all our key brands across all therapeutic categories of prescription pharmaceuticals and increased market shares.
Cardiovascular agents generated the strongest sales, particularly cholesterol-lowering agents. Sales of Sorvasta (rosuvastatin) were the most substantial, but we also increased the visibility of Sorvitimb, our rosuvastatin/ezetimibe single-pill combination. Of our antihypertensives, Prenewel (perindopril/indapamide) recorded the strongest sales, followed by Amlessa (perindopril/amlodipine), Prenessa (perindopril), and Amlewel (perindopril/amlodipine/indapamide). We placed our anticoagulant Daxanlo (dabigatran) on markets, increasing its visibility.
Nalgesin Forte (naproxen) and Doreta (tramadol/paracetamol), including prolonged-release tablets Doreta SR (tramadol/paracetamol), were our most notable analgesics. We also increased the visibility of our non-opioid analgesic Algominal (metamizole). Nolpaza (pantoprazole) and Emozul (esomeprazole) were our best-selling medicines for gastrointestinal disorders. Asentra (sertraline), Mirzaten (mirtazapine), Dulsevia (duloxetine), Kventiax (quetiapine), Parnido (paliperidone), and Memaxa (memantine) were our most prominent central nervous system agents.
We extended our antihyperglycemic product range of the dipeptidyl-peptidase 4 (DPP-4) inhibitors with a mono-component agent Maysiglu (metformin) and a single-pill combination Maymetsi (sitagliptin/metformin). We ventured into the multiple sclerosis therapeutic area with Aregalu (teriflunomide) and expanded our oncology product portfolio with Pomalidomide Krka (pomalidomide) for treating multiple myeloma.
Sales of non-prescription products were driven by Magnezij Krka (magnesium) from our vitamins and minerals range, followed by Nalgesin S (naproxen), and Daleron (paracetamol). In 2024, we expanded our product portfolio with Magnezij Krka DIREKT, containing magnesium and eight group B vitamins, and Imunogard Krka, containing beta-glucan, vitamins, and minerals for immune support.
Fypryst Combo (fipronil/S-methoprene) for protection against fleas and ticks, followed by the broad-spectrum parasiticide Milprazon (milbemycin/praziquantel) were our leading animal health products. We expanded our product portfolio with Otomicol (miconazole/prednisolone/polymyxin), which is indicated for the treatment of primary and secondary skin and skin adnexa infections.
Holding a 7.3% market share, we placed first among all providers of medicines. Of all medicines sold in Slovenia, one in five was made by Krka.
We were the leading provider of:
We were the leading provider of medicines containing alprazolam; atorvastatin; ciprofloxacin; dexamethasone; doxazosin; donepezil; enalapril; esomeprazole; gliclazide; indapamide; carvedilol; quetiapine; losartan, including the losartan/hydrochlorothiazide single-pill combination; memantine; metronidazole; naproxen; omeprazole; pantoprazole; perindopril, including all perindopril/amlodipine/indapamide single-pill combinations; ramipril, including the ramipril/hydrochlorothiazide single-pill combination; rosuvastatin, including the rosuvastatin/ezetimibe single-pill combination; sertraline; simvastatin; telmisartan, including the telmisartan/hydrochlorothiazide single-pill combination; the tramadol/paracetamol single-pill combination; valsartan, including the valsartan/hydrochlorothiazide single-pill combination; and venlafaxine.
We were the leading provider of generic varieties containing aripiprazole; duloxetine; etoricoxib; olanzapine; and tamsulosin.
We were the leading provider of non-prescription products as follows: non-steroidal anti-inflammatory drugs (NSAIDs); products with effect on pharynx; group B vitamins; proton pump inhibitors; vitamin D, and magnesium-based products.
Nalgesin (naproxen), Nolpaza (pantoprazole), Sorvasta (rosuvastatin), Prenewel (perindopril/indapamide), Amlessa (perindopril/amlodipine), Prenessa (perindopril), and Doreta (paracetamol/tramadol) generated the strongest sales.
Region South-East Europe recorded product sales of €269 million, an 8% year-on-year increase. We recorded growth on all regional markets. Absolute growth, however, was the highest in Romania, where our sales increased by €5.2 million. Bulgaria and Croatia followed in terms of absolute year-on-year sales growth, Bulgaria with €3.4 million and Croatia with €3 million.
Prescription pharmaceuticals accounted for 87%, while non-prescriptions accounted for 10% of regional sales. Animal health products constituted slightly more than 3% of total regional sales. Our prescription pharmaceuticals recorded 8% year-on-year growth. Non-prescription product sales increased by 4%, while animal health products surpassed year-on-year sales by 12%.
With a 1.5% market share, we ranked fifth among foreign providers of generic pharmaceuticals in the country. The best-selling prescription pharmaceuticals were Atoris (atorvastatin), Co-Prenessa (perindopril/indapamide), Nolpaza (pantoprazole), Roswera (rosuvastatin), Teotard (theophylline), and Co-Roswera (rosuvastatin/ezetimibe). Our best-selling non-prescription products were Bilobil (ginkgo leaf extract) and Nalgesin (naproxen) in that order. Companion animal products accounted for the majority of animal health product sales, most notably Fypryst brand products, Milprazon (milbemycin/praziquantel), and Selehold (selamectin).
With a 3.4% market share, we ranked second among foreign providers of generic pharmaceuticals in the country. We were the leading provider of:
We were among the leading providers of:
telmisartan/hydrochlorothiazide single-pill combination; tramadol in combination with paracetamol; and valsartan, including the valsartan/hydrochlorothiazide single-pill combination.
We were the leading provider of generic varieties of desloratadine; gliclazide; perindopril in combination with amlodipine; perindopril in combination with amlodipine and indapamide; sitagliptin in combination with metformin; valsartan in combination with amlodipine; valsartan in combination with amlodipine and hydrochlorothiazide; and simvastatin.
Serbia generated €39.1 million in sales, up 4% year on year, ranking it third among regional markets. Our market share in terms of volume has shown above-average growth for several consecutive years. Prescription pharmaceuticals accounted for 87% of overall country sales. Sales were driven by Nolpaza (pantoprazole), Co-Amlessa (perindopril/amlodipine/indapamide), Roxera (rosuvastatin), Co-Prenessa (perindopril/indapamide), Atoris (atorvastatin), and Xerdoxo (rivaroxaban). Non-prescription product sales amounted to €3.3 million. Main products were Nalgesin (naproxen), Bilobil (ginkgo leaf extract), and Herbion brand products. Sales of animal health products increased by 7% compared to 2023. Products sold under the Fypryst and Dehinel brands and Milprazon (milbemycin/praziquantel) led the way.
Sales in Bulgaria totalled €30.2 million in 2024, a 13% year-on-year increase. Prescription pharmaceuticals accounted for 93% of overall country sales, and Co-Valsacor (valsartan/hydrochlorothiazide), Roswera (rosuvastatin), Nolpaza (pantoprazole), Valsacor (valsartan), Co-Amlessa (perindopril/amlodipine/indapamide), Co-Roswera (rosuvastatin/ezetimibe), Valtricom (valsartan/amlodipine/hydrochlorothiazide), and Wamlox (valsartan/amlodipine) recorded the strongest sales. Non-prescription products saw a 23% increase on 2023 and totalled €0.7 million. Animal health products, which accounted for 4% of overall sales, generated €1.3 million, up 14% on 2023. Best-selling animal health products included Fypryst brand products, Milprazon (milbemycin/praziquantel), and Floron (florfenicol).
Our product sales in North Macedonia totalled €29 million, an 8% year-on-year increase. Krka remained the leading foreign provider of generic pharmaceuticals in the country. Sales of prescription pharmaceuticals were pivotal, in particular of Roswera (rosuvastatin), Nolpaza (pantoprazole), Co-Prenessa (perindopril/indapamide), Tanyz (tamsulosin), Atoris (atorvastatin), Enap (enalapril), and Lorista (losartan). Our non-prescription product sales recorded a 7% year-on-year increase, with leading products Septanazal (xylometazoline/dexpanthenol), Flebaven (diosmin), Septolete Total (benzydamine/cetylpyridinium chloride), Daleron (paracetamol), Bilobil (ginkgo leaf extract), and Nalgesin (naproxen). Sales of animal health products generated €0.4 million, down 4% on 2023. Fypryst brand products, Enroxil (enrofloxacin), and Entemulin (tiamulin) added the most to overall sales.
We recorded sales of €23.4 million, up 9%, and remained the leading foreign provider of generic pharmaceuticals in Bosnia and Herzegovina. Prescription pharmaceuticals accounted for the majority of total sales and recorded a 9% sales increase. Roswera (rosuvastatin), Amlewel (perindopril/amlodipine/indapamide), Lexaurin (bromazepam), Enap-H and Enap-HL (enalapril/hydrochlorothiazide), and Nolpaza (pantoprazole) generated the strongest sales. The most notable new product launch in 2024 was Dagrafors (dapagliflozin). Among non-prescription products, Nalgesin (naproxen), Panatus (butamirate), Septolete Total (benzydamine/cetylpyridinium chloride), and Bilobil (ginkgo leaf extract) led the way, up 13% on 2023. Fypryst brand products remained key animal health products.
In Kosovo, we recorded a 4% sales increase, placing us among the country’s leading providers of medicines. Sales reached €9.4 million. Prescription pharmaceuticals accounted for the majority of sales, with Roswera (rosuvastatin), Lorista H (losartan/hydrochlorothiazide), and Atoris (atorvastatin) the leading products. Year-on-year sales in Albania increased by a robust 6%, totalling €4.1 million. As expected, prescription pharmaceuticals accounted for the majority of total sales. Ultop (omeprazole), Atoris (atorvastatin), Nolpaza (pantoprazole), Enap (enalapril), and Lorista (losartan) generated the strongest sales. We recorded sales totalling a sound €3.3 million in Montenegro, up just over 30%. Sales were driven in particular by prescription pharmaceuticals, most notably Nolpaza (pantoprazole), Maymetsi (sitagliptin/metformin), Atixarso (ticagrelor), Roswera (rosuvastatin), and Co-Roswera (rosuvastatin/ezetimibe). We celebrated the fourth year of independently marketing products in Greece, with total product sales of €3.8 million. Pitavador (pitavastatin), Parnido (paliperidone), Zalasta (olanzapine), Dulsevia (duloxetine), and Rosuvador (rosuvastatin) were the major prescription pharmaceuticals.
Region East Europe generated sales totalling €650.3 million, a 9% year-on-year increase, and remained the leading region by sales. Sales increased across all markets. In addition to both key markets in the region, Uzbekistan returned the highest absolute sales growth, increasing product sales by €4.9 million on 2023. We recorded the highest relative sales growth in Tajikistan.
The Russian Federation remained our largest individual market. In the Russian Federation, our product sales generated €373.3 million, up 8% on 2023. We sell our products in the Russian Federation in the national currency. Sales denominated in the Russian rouble reached ₽37 billion, up 19%, while sales volume remained stable year on year. The difference between the euro and the rouble sales indices was due to the rouble’s depreciation.
Prescription pharmaceuticals were the leading product group, generating €292.9 million or 78% of overall sales. Co-Dalneva (perindopril/amlodipine/indapamide), Co-Perineva (perindopril/indapamide), Valsacor (valsartan), Lorista H and Lorista HD (losartan/hydrochlorothiazide), Lorista (losartan), Vamloset (valsartan/amlodipine), Roxera (rosuvastatin), Nolpaza (pantoprazole), Valsacor H and Valsacor HD (valsartan/hydrochlorothiazide), and Co-Vamloset (valsartan/amlodipine/hydrochlorothiazide) generated the strongest sales. Co-Dalneva (perindopril/amlodipine/indapamide), Roxera Plus (rosuvastatin/ezetimibe), and Co-Vamloset (valsartan/amlodipine/hydrochlorothiazide) recorded the highest absolute growth. We successfully launched our new products Telinstar (telmisartan/indapamide), Telmista Trio (telmisartan/amlodipine/hydrochlorothiazide), Glypvilo (vildagliptin), and Glypvilo Met (vildagliptin/metformin).
Sales of non-prescription products generated €42.5 million in 2024. Nalgesin (naproxen), which recorded the highest absolute growth, along with Septolete Total (benzydamine/cetylpyridinium chloride) and Herbion brand products, were particularly notable. We successfully marketed Flebaven (diosmin/hesperidin) as well.
Sales of animal health products recorded high growth, generating €37.9 million. The leading animal health products were Milprazon (milbemycin/praziquantel), Selafort (selamectin), and Cladaxxa (amoxicillin/clavulanic acid). Tuloxxin (tulathromycin) and Fypryst brand products recorded the most impressive absolute growth.
We manufactured the majority, or 76%, of the products sold in the Russian Federation at our local Russian plant Krka-Rus.
With a 1.8% market share, we were the leading foreign provider of generic pharmaceuticals in the country. We were the leading provider of prescription pharmaceuticals for treating cardiovascular diseases. We were the leading provider of generic prescription pharmaceuticals in the pharmacy segment. We were the leading provider of:
Statins, accounting for approximately a 20% market share;
Atypical antipsychotics, accounting for approximately a 15% market share.
We were among the leading providers of:
We were the leading provider of medicines containing duloxetine; enalapril, including the enalapril/hydrochlorothiazide single-pill combination; losartan, including the two losartan-based single-pill combinations with amlodipine and hydrochlorothiazide; naproxen; norfloxacin; olanzapine; pantoprazole; ramipril; sitagliptin, including the sitagliptin/metformin single-pill combination; and valsartan, including all valsartan/amlodipine/hydrochlorothiazide single-pill combinations.
We were the leading provider of generic varieties of dabigatran; escitalopram; esomeprazole; ivabradine; perindopril, including all perindopril/amlodipine/indapamide single-pill combinations; rosuvastatin; telmisartan, including the telmisartan/amlodipine single-pill combination.
In Ukraine, another of our key markets, pharmaceutical sales had stagnated in recent years, but a recovery began in 2024.
Our products generated €96 million in sales, a 15% increase on 2023. With a 3% market share, we ranked second among foreign providers of generic pharmaceuticals in the country. In 2024, we outperformed the entire market with respect to sales growth. Prescription pharmaceuticals, our leading product group, accounted for 84% of total 2024 sales, with Co-Prenessa (perindopril/indapamide), Co-Amlessa (perindopril/amlodipine/indapamide), Nolpaza (pantoprazole), and Roxera (rosuvastatin) at the forefront. Non-prescription product sales accounted for just under 11% of 2024 overall country sales, though they lagged behind the previous year. Nalgesin (naproxen), Herbion brand products and Septolete Total (benzydamine/cetylpyridinium chloride) generated the most substantial sales. Sales of animal health products increased by a sound 8% compared to 2023. The leading animal health products were Milprazon (milbemycin/praziquantel), Selafort (selamectin), and Prinocate (imidacloprid/moxidectin).
With a 3% market share, we ranked second among foreign providers of generic pharmaceuticals in the country. In 2024, we outperformed the entire market with respect to sales growth.
We were the leading provider of:
We were the leading provider of atorvastatin; dexamethasone; enalapril, including the enalapril/hydrochlorothiazide single-pill combination; ginkgo leaf extract; carvedilol; clarithromycin; the losartan/hydrochlorothiazide single-pill combination; naproxen; pantoprazole; perindopril, including the perindopril/indapamide single-pill combination; rosuvastatin; valsartan, including two valsartan-based single-pill combinations with hydrochlorothiazide and amlodipine.
We were the leading provider of generic varieties of perindopril in combination with amlodipine and the perindopril/amlodipine/indapamide single-pill combination.
In Subregion East Europe B, which includes Belarus, Mongolia, Armenia, and Azerbaijan, our product sales totalled €63.6 million, up 11%. We recorded double-digit sales growth in Belarus, Azerbaijan, and Armenia.
Sales in Belarus totalled €28 million, up 15% on 2023. We increased our market share owing to above-average growth dynamics in terms of value and volume and ranked first among foreign providers of generic pharmaceuticals. Co-Amlessa (perindopril/amlodipine/indapamide), Nolpaza (pantoprazole), and Co-Prenessa (perindopril/indapamide) accounted for the mass of prescription pharmaceuticals, our key product group. Our best-selling non-prescription products were Septolete Total (benzydamine/cetylpyridinium chloride) and Herbion brand products. However, their sales were lower than in 2023. Sales of our animal health products generated €1.5 million, with Trisulfon (sulfamonomethoxine/trimethoprim) recording the strongest sales.
In Mongolia, product sales totalled €16.7 million, up over 5% year on year, maintaining our position as the country’s leading foreign provider of medicines. A sharp rise in sales of cardiovascular agents and antibiotics drove the growth of prescription pharmaceutical sales. Nolpaza (pantoprazole), Zyllt (clopidogrel), Amlessa (perindopril/amlodipine), Fromilid (clarithromycin), Lorista (losartan), and Betaklav (amoxicillin/clavulanic acid) each recorded sales of over €1 million. Sales of non-prescription products were driven primarily by Septolete Total (benzydamine/cetylpyridinium chloride), Septanazal (xylometazoline/dexpanthenol), Nalgesin (naproxen), and Herbion brand products.
In Azerbaijan, our product sales reached €10.6 million, a 10% increase on 2023. Holding slightly more than a 3% market share, we retained the top ranking among manufacturers of generic pharmaceuticals in the country. Prescription pharmaceutical sales accounted for nearly 94%, while non-prescription products accounted for almost 3% of overall sales. Animal health product sales, in particular products for farm animals, generated €0.4 million, or just shy of 4% of overall country sales.
Product sales in Armenia totalled €8.3 million, up 14% on 2023. With a 3.8% market share, we ranked first among providers of generic pharmaceuticals. Prescription pharmaceuticals constituted 91% of sales, with Co-Amlessa (perindopril/amlodipine/indapamide), Nolpaza (pantoprazole), and Atoris (atorvastatin) leading the way. We recorded a nearly 8% increase in sales of non-prescription products. Non-prescription product sales were driven by Septolete Total (benzydamine/cetylpyridinium chloride) and Nalgesin (naproxen).
Product sales in Kazakhstan, Moldova, and Kyrgyzstan were valued at €46.1 million, a 10% year-on-year increase. We recorded growth across all markets of the subregion.
Product sales in Kazakhstan totalled €23.6 million, up 8% year on year. Prescription pharmaceuticals generated 72% of overall sales, up 16%. Nolpaza (pantoprazole), Valodip (valsartan/amlodipine), Ulcavis (bismuth), and Co-Amlessa (perindopril/amlodipine/indapamide) generated the majority of overall prescription sales. Sales of non-prescription products amounted to €5.9 million, a year-on-year drop. Herbion brand products, Septolete Total (benzydamine/cetylpyridinium chloride), and Septanazal (xylometazoline/dexpanthenol), recorded the strongest sales. Sales of animal health products totalled €0.8 million, with Ecocid and Selafort (selamectin) generating the strongest sales.
(xylometazoline/dexpanthenol), Nalgesin (naproxen), and Septolete Total (benzydamine/cetylpyridinium chloride) generated the strongest sales. Sales of animal health products generated €0.4 million, up 32% year on year.
We generated €7.8 million in product sales, up 21%, securing a 3.9% market share in Kyrgyzstan, positioning us second among providers of generic pharmaceuticals in the country. Prescription pharmaceuticals generated 81% or the majority of total sales, with Lorista (losartan), Atoris (atorvastatin), and Nolpaza (pantoprazole) leading the way. Sales of our non-prescription products were driven by Septolete Total (benzydamine/cetylpyridinium chloride) and products sold under the Herbion and Pikovit brands.
Our Subregion East Europe U, comprising Uzbekistan, Georgia, Tajikistan, and Turkmenistan, generated €71.3 million in product sales, up 10%. We recorded growth across all four markets.
Product sales in Uzbekistan totalled €53.7 million, up 10% on 2023. We remained the leading provider of pharmaceuticals and cardiovascular agents in the country. Amlessa (perindopril/amlodipine), Nolpaza (pantoprazole), Valodip (valsartan/amlodipine), and Co-Amlessa (perindopril/amlodipine/indapamide) generated the majority of our prescription pharmaceutical sales. Of non-prescription products, which saw a year-on-year drop, key products included Septolete Total (benzydamine/cetylpyridinium chloride) and Pikovit brand products.
Our product sales in Georgia amounted to €10.1 million, a 7% year-on-year increase. Our 4.4% market share ranked us fifth among all providers of pharmaceuticals in the country. Our best-selling prescription pharmaceuticals were Lorista H and Lorista HD (losartan/hydrochlorothiazide), Amlessa (perindopril/amlodipine), and Atoris (atorvastatin). Herbion brand products were the best-selling non-prescription products.
In Tajikistan, sales reached €4.6 million, a 24% year-on-year increase. Dexamethasone (dexamethasone) generated the strongest sales. Nolpaza (pantoprazole) and Co-Amlessa (perindopril/amlodipine/indapamide) generated the highest sales of our new products.
Product sales in Turkmenistan totalled €2.8 million, up 11% on 2023. Nolpaza (pantoprazole) and Naklofen (diclofenac) from our leading product group of prescription pharmaceuticals and non-prescription products sold under the Pikovit and Herbion brands generated the strongest sales.
Region Central Europe generated product sales of €426.5 million, up 7%. We recorded growth across all regional markets, except in Czechia. Poland recorded the highest sales value increase in the region, where product sales grew by €25.3 million. Poland and Lithuania recorded the highest relative sales growth. Sales grew by 14% in each country.
In Poland, the largest regional market and our key market, product sales reached €206.1 million, a 14% increase on 2023. We ranked third among foreign providers of generic pharmaceuticals. Sales were driven by prescription pharmaceuticals, most notably pharmaceuticals from the reimbursement list. Our recently launched medicines have also made a significant contribution to our sales.
We focused on cardiovascular agents and managed to increase sales by 11% despite significant market pressures. Our most notable recently launched medicines were Coroswera (rosuvastatin/ezetimibe), which saw a 59% year-on-year sales increase, and our antidiabetic agents Maymetsi (sitagliptin/metformin), accounting for a 23% market share, Maysiglu (sitagliptin) with a 21% market share, and Vimetso (vildagliptin/metformin) with an 80% market share. We successfully launched Aramlessa (perindopril/amlodipine), CoAramlessa (perindopril/amlodipine/indapamide), Daxanlo (dabigatran), Tolutris (telmisartan/amlodipine/hydrochlorothiazide), and Vabinxo (valsartan/indapamide).
Year-on-year sales of non-prescription medicines rose by 26%. Septanazal (xylometazoline/dexpanthenol) was at the forefront, generating a 44% year-on-year sales increase, followed by Septolete brand products. Animal health products created €8.7 million in sales, up 16%. Milprazon (milbemycin/praziquantel), up 19%, and Floron (florfenicol), up 16%, remained our best-selling animal health products.
With a 1.8% market share, we ranked third among foreign providers of generic pharmaceuticals in the country. We were the leading provider of:
We were among the leading providers of:
We were the leading provider of atorvastatin; celecoxib; duloxetine; candesartan, including the candesartan/hydrochlorothiazide single-pill combination; lansoprazole; losartan, including the losartan/hydrochlorothiazide single-pill combination; norfloxacin; pramipexole; rabeprazole; ropinirole; rosuvastatin; sulfasalazine; the tramadol/paracetamol single-pill combination; the telmisartan/amlodipine single-pill combination; and valsartan, including valsartan/hydrochlorothiazide and valsartan/amlodipine/hydrochlorothiazide single-pill combinations; and vildagliptin, including the vildagliptin/metformin single-pill combination.
We were the leading provider of generic varieties of gentamicin; gliclazide; and perindopril, including all perindopril-based single-pill combinations with amlodipine and indapamide.
In Czechia, another of our key markets, year-on-year sales decreased by 4% to €58.6 million. With a 1.3% market share, we retained fourth place among foreign providers of generic pharmaceuticals. Prescription pharmaceuticals maintained the leading position, in particular Sorvasta (rosuvastatin), Atoris (atorvastatin), Lexaurin (bromazepam), Nolpaza (pantoprazole), Pragiola (pregabalin), Doreta (tramadol/paracetamol), Elicea (escitalopram), Tonanda (perindopril/amlodipine/indapamide), Asentra (sertraline), Tonarssa (perindopril/amlodipine), and Prenewel (perindopril/indapamide).
Non-prescription product sales amounted to €3.0 million. In addition to Nalgesin S (naproxen), Septolete brand products and Nolpaza (pantoprazole) were best-sellers. Sales of animal health products grew 1%, with key products continuing to be those sold under the Dehinel and Fypryst brands.
We were the leading provider of:
We were among the leading providers of:
We were the leading provider of medicines containing atorvastatin; escitalopram; esomeprazole; gliclazide; carvedilol; lansoprazole; pramipexole; valsartan, including valsartan in combination with hydrochlorothiazide.
We were the leading provider of generic varieties of levocetirizine; pantoprazole; perindopril, including all perindopril-based single-pill combinations with amlodipine and indapamide; and tadalafil.
Hungary, another key market, generated sales of €53.3 million, up 2% year on year, making it our third-largest regional market. We ranked third among primarily foreign providers of generic pharmaceuticals in the country, holding a 1.5% market share. Prescription pharmaceuticals generated the highest sales, in particular, Co-Prenessa (perindopril/indapamide), Roxera (rosuvastatin), Emozul (esomeprazole), Zyllt (clopidogrel), Valsacor (valsartan), and Co-Dalnessa (perindopril/amlodipine/indapamide).
Sales of non-prescription products generated €4.2 million, matching 2023 sales. Bilobil (ginkgo leaf extract), Septanazal (xylometazoline/dexpanthenol), and Septolete Extra (benzydamine/cetylpyridinium chloride) generated the strongest sales. Sales of our animal health products increased by 17%. Milprazon (milbemycin/praziquantel) and Fypryst brand products were the best-sellers.
With a 1.5% market share, we ranked third among primarily foreign providers of generic pharmaceuticals in the country.
We were the leading provider of:
We were among the leading providers of:
We were the leading provider of medicines containing duloxetine; etoricoxib; clarithromycin; clopidogrel; mirtazapine; pramipexole; rasagiline; and valsartan, including valsartan in combination with hydrochlorothiazide.
We were the leading provider of generic varieties containing ginkgo leaf extract; gliclazide; and zolpidem.
In Slovakia, another key market and the fourth-largest regional market, we recorded product sales of €42.9 million, on par with 2023 sales figures. Prescription pharmaceuticals were the best-selling product group, most notably Atoris (atorvastatin), Co-Prenessa (perindopril/indapamide), Nolpaza (pantoprazole), Co-Amlessa (perindopril/amlodipine/indapamide), Amlessa (perindopril/amlodipine), and Prenessa (perindopril).
Year-on-year sales of non-prescription medicines dropped by 5%. Nalgesin S (naproxen), Flebaven (diosmin), Septolete brand products, and Nolpaza (pantoprazole) generated the highest sales. Animal health product sales increased by 14%, with Fypryst brand products and Enroxil (enrofloxacin) recording the strongest sales.
With a 2.1% market share, we ranked fourth among all providers of generic pharmaceuticals in the country.
We were the leading provider of:
We were among the leading providers of:
We were the leading provider of medicines containing atorvastatin; diosmin; donepezil; duloxetine; escitalopram; esomeprazole; the rosuvastatin/ezetimibe single-pill combination; indapamide; carvedilol; quetiapine; linezolid; paliperidone; pantoprazole; pramipexole; tramadol in combination with paracetamol; valsartan; including all valsartan-based single-pill combinations with amlodipine and hydrochlorothiazide; venlafaxine; and ziprasidone.
We were the leading provider of generic varieties of dexamethasone; gliclazide; and perindopril, including all perindopril-based single-pill combinations with amlodipine and indapamide.
Sales in Lithuania totalled €34 million, up 14%. As a result, we retained our position as the leading provider of generic pharmaceuticals in the country. Prescription pharmaceuticals accounted for the majority of overall sales, which saw a 17% increase, totalling €28.7 million. Roswera (rosuvastatin), Ravalsyo (rosuvastatin/valsartan), Nolpaza (pantoprazole), Escadra (esomeprazole), Atoris (atorvastatin), and Zonsiloc (bisoprolol) generated the strongest sales. Non-prescription product sales amounted to €3.2 million, with Septabene (benzydamine/cetylpyridinium chloride) and Nalgesin S (naproxen) generating the most notable sales. Sales of animal health products were up 34%, totalling €2.1 million. Fypryst brand products accounted for the majority of animal health product sales, up 47%, while Milprazon (milbemycin/praziquantel) sales were up 33%.
Escadra (esomeprazole), Atoris (atorvastatin), and Bericox (etoricoxib). Non-prescription product sales amounted to €2.6 million. Septanazal (xylometazoline/dexpanthenol) and Septabene (benzydamine/cetylpyridinium chloride) remained the leading non-prescription products. Sales of animal health products increased 29%.
In Estonia, sales totalled €12.6 million, up 3% on 2023. Prescription pharmaceuticals again accounted for the majority of overall sales, above all Roswera (rosuvastatin), Atoris (atorvastatin), Co-Prenessa (perindopril/indapamide), Nolpaza (pantoprazole), and Prenessa (perindopril). Non-prescription product sales amounted to €1.5 million, Septolete Omni (benzydamine/cetylpyridinium chloride) and Herbion brand products remained the leading non-prescription products. Sales of animal health products increased 21%.
The markets of Region West Europe are collectively regarded as key markets for us. Regional sales amounted to €351.8 million in 2024, a 5% year-on-year decrease. Germany, the Scandinavian countries, Portugal, Italy, and the United Kingdom recorded the highest sales. Sales through subsidiaries totalled €298.5 million, a 1% year-on-year decrease. We generated 15% of regional sales through unrelated parties.
Prescription pharmaceuticals were the leading product group, generating sales of €303.4 million, down 5% on 2023, and accounting for 86% of overall regional sales. Medicines containing esomeprazole, candesartan, and valsartan were at the forefront.
Animal health products generated €36.1 million, accounting for 10% of overall regional sales. Sales through related parties grew by 3% in 2024, and accounted for 63% of overall sales of animal health products in the region. Sales of animal health products were driven by antiparasitic products, most notably milbemycin/praziquantel/imidacloprid tablets and fipronil. Among our products for farm animals, medicines containing toltrazuril were the best-sellers.
Sales of non-prescription products grew by 6%, accounting for 3% of regional sales. Sales were driven by Septolete brand products, products containing paracetamol, and products containing acetylsalicylic acid.
We operate in the region via our key market, Germany, and four subregional units: Europe– South; Europe – Continental West; Scandinavia; Europe – West. We generated €10.4 million in product sales in other European countries that do not fall into any of our categories.
Germany remained our key regional and individual market. Country sales reached €83.4 million. Our best-selling products included medicines for treating cardiovascular diseases; gastrointestinal tract and metabolism disorders; central nervous system disorders; and oncology agents, in that order. We remained one of the leading sartan providers in the country also in 2024. Candesartan; ramipril; sitagliptin; pomalidomide; and ranolazine generated the highest sales.
With a 1.5% market share, we ranked eighth of all foreign providers of generic pharmaceuticals in the country. We outperformed the entire market with respect to sales growth of all our therapeutic classes.
We were the leading provider of:
We were among the leading providers of:
We were among the leading providers of gliptin-based products, accounting for more than a 15% market share in terms of volume.
We were the leading provider of pharmaceuticals containing cyproterone; candesartan/hydrochlorothiazide single-pill combinations; candesartan/amlodipine single-pill combinations; prasugrel; ramipril/amlodipine single-pill combinations; valsartan/hydrochlorothiazide single-pill combinations; and tramadol in combination with paracetamol.
We were one of the leading providers of pharmaceuticals containing bisoprolol in combination with amlodipine; dabigatran; dexketoprofen; dutasteride; the enalapril/hydrochlorothiazide single-pill combination; esomeprazole; ivabradine; candesartan; carvedilol; the losartan/hydrochlorothiazide single-pill combination; pomalidomide; pramipexole; ranolazine; sertraline; sitagliptin, including the sitagliptin/metformin single-pill combination; terazosin; valsartan, including the valsartan/amlodipine/hydrochlorothiazide single-pill combination; vildagliptin, including the vildagliptin/metformin single-pill combination; and ziprasidone.
Subregion Europe – South comprises Italy, Portugal, and Spain. Subregional product sales amounted to €86.9 million, down 2% on 2023. Products marketed under our own brands accounted for 76% of total subregional sales.
In Portugal, sales totalled €33.8 million, commensurate with the 2023 figure. Sales through our subsidiary recorded a 7% year-on-year growth. Prescription pharmaceuticals generated the highest absolute growth. Our paramount prescription pharmaceuticals included tapentadol – we were the leading provider of the generic variety of tapentadol in the country; the rosuvastatin/ezetimibe single-pill combination; the emtricitabine/tenofovir single-pill combination; and olanzapine. In 2024, we launched a new dabigatran-based product, which already ranks among our top ten prescription pharmaceuticals.
In Italy, we generated product sales of €27.6 million. We primarily increased sales of our animal health products. Medicines containing pantoprazole; clopidogrel; atorvastatin; quetiapine; and gliclazide were among our leading prescription pharmaceuticals.
In Spain, year-on-year sales grew 12%, reaching €25.5 million. We primarily increased sales of our animal health products. Medicines containing donepezil; pramipexole; galantamine; memantine; and naproxen generated the strongest sales.
Our sales in Scandinavia generated €68.5 million, up 9% on 2023. Sweden remained the leading subregional market, followed by Finland, Norway, Denmark, and Iceland. Sales were driven by medicines containing esomeprazole; candesartan; pantoprazole; dabigatran; and pramipexole. In Norway, we retained the leading position for many medicines, particularly those containing esomeprazole; pantoprazole; and losartan. We were one of the leading generic manufacturers of medicines containing venlafaxine, rosuvastatin, and losartan in Finland; esomeprazole, dabigatran, and paracetamol in Sweden; and pramipexole and metoprolol in Denmark. Our product sales in Iceland generated €2.4 million, with esomeprazole and pregabalin recording the strongest sales.
Sales in France totalled €20.4 million. Prescription pharmaceuticals were the leading product group, generating €16.1 million. Medicines containing esomeprazole; gliclazide; and tadalafil were at the forefront. Antiparasitics for companion animals generated the strongest sales of our animal health product range, most notably milbemycin and praziquantel in combinations. Products containing paracetamol stood out among our non-prescription products.
In the Benelux, sales amounted to €28.9 million, up 34% year on year. In Belgium, we generated €13.3 million in product sales, up 12% on 2023. Prescription pharmaceuticals generated the strongest sales, particularly emtricitabine in combination with tenofovir; quetiapine; esomeprazole; and aripiprazole. The best-selling animal health product was the combination of milbemycin and praziquantel. In the Netherlands, we generated €15.6 million in product sales, up 60% on 2023. Prescription pharmaceuticals generated the strongest sales, primarily medicines containing ezetimibe; valsartan; eplerenone; and abiraterone. The best-selling animal health product was the combination of milbemycin and praziquantel.
The United Kingdom, Ireland, and Austria constitute our Subregion Europe – West. The subregion recorded €53.4 million in sales, a 15% year-on-year increase. Sales through our subsidiaries increased by 17%, accounting for 95% of overall sub-regional sales.
Sales in the United Kingdom increased by 40% year on year, reaching €27.1 million. Milbemycin/praziquantel and fipronil/S-methoprene combinations; ranolazine; rasagiline; and venlafaxine generated the strongest sales.
In Ireland, we generated €14.6 million in product sales, down 4% on 2023. We were one of the leading providers of pharmaceuticals containing esomeprazole; ezetimibe; venlafaxine; candesartan; levocetirizine; valsartan; indapamide; and duloxetine.
In Austria, our sales decreased by 2%, totalling €11.7 million. Sales were driven by pharmaceuticals containing pregabalin; valsartan; and duloxetine.
Region Overseas Markets generated sales of €81.1 million, up 8% on 2023. Three out of four sales offices recorded sales growth. Prescription pharmaceuticals contributed the most to the increase. We primarily marketed them under our brands, which accounted for more than 90% of overall regional sales.
Product sales in the markets of the Middle East totalled €26.8 million, an 8% year-on-year decrease. This decrease was due to tensions in Iran, where our sales fell by 17%. However, we recorded growth across all other markets covered by the sales office. We recorded the most substantial growth in Iraq, the United Arab Emirates, and Saudi Arabia. In the Middle East, Asentra (sertraline), Nolpaza (pantoprazole), Yasnal (donepezil), Zyllt (clopidogrel), and Emanera (esomeprazole) generated the strongest sales.
Product sales in the Far East and Africa reached €37.1 million, up 21% on 2023. We increased our sales by 23% in Vietnam, making the country the largest individual regional market. We also recorded relatively high sales in the Philippines, Malaysia, and the Republic of South Africa. Medicines containing gliclazide; esomeprazole; tramadol in combination with paracetamol; lansoprazole; and doxazosin were our best-selling products.
Our sales office in China generated €15.3 million in product sales, up 12% on 2023. Strong sales of Palprostes (saw palmetto extract), the medicine made by our subsidiary TAD Pharma, continued. We also increased sales through our joint venture, Ningbo Krka Menovo, which successfully marketed products containing pregabalin; losartan; and gliclazide.
Our Americas sales office remained focused on the countries of Central America, where overall product sales reached €2 million, up 11% on 2023. Valsacor (valsartan), Valsaden (valsartan/hydrochlorothiazide), Nolpaza (pantoprazole), and Rawel (indapamide) were our best-selling products.
In 2024, sales of prescription pharmaceuticals accounted for 82.5% of total sales, followed by non-prescription products at 9.0%, animal health products at 5.9%, and health resort and tourist services at 2.6%. Sales of prescription pharmaceuticals increased by 7%, non-prescription products saw a 3% decrease in sales, while animal health products sales grew by 7%, and health resort and tourist services by 3%.
| € thousand | Krka Group | Company | ||||
|---|---|---|---|---|---|---|
| 2024 | 2023 | Index | 2024 | 2023 | Index | |
| Human health | 1.738.650 | 1.646.633 | 106 | 1.432.353 | 1.350.438 | 106 |
| – Prescription pharmaceuticals | 1.567.359 | 1.469.381 | 107 | 1.262.830 | 1.181.580 | 107 |
| – Non-prescription products | 171.291 | 177.252 | 97 | 169.523 | 168.858 | 100 |
| Animal health products | 111.847 | 104.640 |
| € thousand | 2024 | 2023 |
|---|---|---|
| Q1 | 442.988 | 417.457 |
| Q2 | 454.155 | 418.146 |
| Q3 | 405.777 | 379.484 |
| Q4 | 435.730 | 431.546 |
| 2024 | 2023 | |
|---|---|---|
| – Prescription pharmaceuticals | 400.179 | 370.309 |
| – Non-prescription products | 42.809 | 47.148 |
| 2024 | 2023 | |
|---|---|---|
| 30.163 | 28.402 |
| 2024 | 2023 | |
|---|---|---|
| 10.953 | 10.394 |
| 2024 | 2023 | |
|---|---|---|
| 484.104 | 456.253 |
| Prescription pharmaceuticals | 82.5% |
|---|---|
| Non-prescription products | 9.0% |
| Animal health products | 5.9% |
| Health resorts and tourist services | 2.6% |
**Sales of leading products are presented by main active ingredient. Combination medicines that incorporate this active ingredient are also included.
In 2024, sales of new products, i.e. products launched in individual markets in the past five years, accounted for 24% of the Krka Group overall sales, or 2 percentage points up on the year before.
In 2024, the following new products were most significant in terms of absolute sales growth: Daxanlo (dabigatran), first launched on most markets in 2024; Tezulix (ranolazine), first marketed in 2023; Maysiglu (sitagliptin); Maymetsi (sitagliptin/metformin); and an animal health product Cladaxxa (amoxicillin/clavulanic acid), all three first launched in 2022.
In 2024, we introduced several new products containing new generic active ingredients, also in combinations, and expanded our range with new pharmaceutical forms or pack sizes, and launched them in new markets.
*** Includes products launched on individual markets within the past five years.
In 2024, Krka Group sales of prescription pharmaceuticals amounted to €1,567.4 million, up 6.7% year on year. The strongest growth contributions came from the Russian Federation, Poland and Ukraine.
system agents, and gastrointestinal tract medicines. We market our prescription pharmaceuticals under our brands in most European countries through our marketing and sales network. In the countries where we have a long-standing presence, our marketing and sales network is among the most robust in the pharmaceutical industry. We use it to engage with the expert community, especially physicians and pharmacists. In most western European markets, we have been managing sales through our network.
| Russian Federation | Poland | Ukraine | Germany | Romania | Scandinavia | Slovenia | Czechia | Hungary | Uzbekistan |
|---|---|---|---|---|---|---|---|---|---|
| € million | € million | € million | € million | € million | € million | € million | € million | € million | € million |
| Therapeutic Class | Percentage |
|---|---|
| Cardiovascular agents | 54.6% |
| Central nervous system | 12.5% |
| Gastrointestinal tract | 11.1% |
| Pain relief | 5.8% |
| Antiinfectives for systemic use | 3.8% |
| Antidiabetics | 3.2% |
| Other | 9.0% |
valsartan (Valsacor)valsartan/hydrochlorothiazide (Co-Valsacombi)valsartan/amlodipine (Wamlox)valsartan/amlodipine/hydrochlorothiazide (Valtricom)valsartan/rosuvastatin (Valarox)valsartan/indapamide (Valomindo)losartan (Lorista)losartan/hydrochlorothiazide (Lorista H)losartan/amlodipine (Tenloris)telmisartan (Tolura)telmisartan/hydrochlorothiazide (Tolucombi)telmisartan/amlodipine (Teldipin)telmisartan/amlodipine/hydrochlorothiazide (Tolutris)telmisartan, indapamide (Telinstar)kandesartan (Karbis)candesartan/hydrochlorothiazide (Karbicombi)candesartan/amlodipine (Camlocor)olmesartan (Olimestra)olmesartan/hydrochlorothiazide (Co-Olimestra)olmesartan/amlodipine (Olssa)olmesartan/amlodipine/hydrochlorothiazide (Olsitri)irbesartan (Ifirmasta)irbesartan/hydrochlorothiazide (Ifirmacombi)
Valsartan is our flagship sartan. Valsartan-based products placed second among all our medicines in 2024 sales. We sold almost 1.5 billion valsartan-based tablets. They were among the leading products also in absolute sales terms. Two single-pill combinations, Wamlox and Valtricom saw the highest sales increase. We added Valomindo to our valsartan portfolio, now consisting of six products. These innovative modified-release tablets combine valsartan and a diuretic. We were the first and only supplier in Europe and first marketed it in Germany, Poland, Hungary, and other markets. Valtricom, a triple combination, remained the only single-pill combination of this type in Czechia, Belarus, and certain other eastern European markets. We extended the marketing reach of our valsartan products. We rolled out Valsacor in China through our subsidiary, Wamlox in Singapore, and Valtricom* as the first generic variety in Portugal. In 2024, we were the leading manufacturer of generic perindopril varieties worldwide. More than four million end-users take our valsartan-based medicines. We ranked first among all valsartan providers in Poland, Ukraine, and several other eastern European markets.
Losartan is our second major sartan. Losartan-based products were among Krka’s best-selling products and were among the six medicines to exceed one billion tablets sold. Lorista and losartan in combinations were the leading sartan-based medicines in Georgia, Kyrgyzstan, and Uzbekistan. Tenloris was the only single-pill combination of this type in Germany, Poland, and several other countries. We first marketed the losartan/hydrochlorothiazide single-pill combination through our partner in Iraq, and the losartan/amlodipine single-pill combination in Vietnam. We remained the leading manufacturer of all losartan products in Europe, capturing a market share of over 20% last year.
| Angiotensin-converting enzyme (ACE) inhibitors | Combinations containing a diuretic | Combinations containing a calcium channel blocker | Combinations containing a diuretic and a calcium channel blocker | Combinations containing a statin |
|---|---|---|---|---|
| perindopril (Prenessa*) | perindopril, indapamide (Co-Prenessa*) | perindopril, amlodipine (Amlessa*) | perindopril, amlodipine, indapamide (Co-Amlessa*) | perindopril, indapamide, rosuvastatin (Roxiper*) |
| perindopril, amlodipine, rosuvastatin (Roxampex*) | enalapril (Enap*) | enalapril/hydrochlorothiazide (Enap-H*) | enalapril, lerkanidipine (Elernap*) | |
| ramipril (Ampril*) | ramipril/hydrochlorothiazide (Ampril HL*) | ramipril, amlodipine (Rameam*) | cilazapril (Cazaprol) | kaptopril (Blocordil*) |
Perindopril-based products were our best-selling pharmaceuticals in 2024. This was the first time since incorporation that our product surpassed €200 million in sales. We sold almost 2 billion perindopril-based tablets, an increase of over 180 million on the year before. These products also saw the most substantial absolute sales increases. We are a generic pharmaceutical company with the most extensive perindopril-based product range in the world. We are the only manufacturer supplying two triple combinations of perindopril, another antihypertensive, and a statin. We market Roxiper and Roxampex for treating lipitension, i.e. coexisting hypertension and hyperlipidemia. In 2024, we added to our portfolio another single-pill combination, containing perindopril arginine, a new perindopril salt Co-Amlessa Neo (perindopril arginine/indapamide/amlodipine), which we first made available in Poland, Portugal, Romania, and several other countries. We extended the marketing reach of other agents from this product category. We rolled out Prenessa via our business partner in China, Roxiper in Romania, and Roxampex in Georgia. As in the previous year, we remained the leading manufacturer of all perindopril products in the world. In 2024, we grew our market share to almost 10%.
Sartans and angiotensin-converting enzyme inhibitors are our two major types of antihypertensives. Our product portfolio also includes a calcium channel blocker Tenox (amlodipine), a diuretic Rawel SR (indapamide), adrenergic receptor blockers Coryol (carvedilol), Bloxazoc (metoprolol), Niperten (bisoprolol), and a single-pill combination Sobycombi (bisoprolol/amlodipine). Altogether, we marketed 45 antihypertensives in more than 150 strengths.
Rosuvastatin remained our primary hypolipaemic agent also in 2024. Rosuvastatin and the rosuvastatin/ezetimibe single-pill combination ranked among our five best-selling products. We sold more than one billion rosuvastatin-based tablets, up 100 million on the year before, and their sales revenue surpassed €100 million for the first time. Sales of rosuvastatin-based products increased by 20% on the year before, ranking them among the products with the highest absolute sales growth. Roswera was the leading statin and outstripped our Atoris, placing first of all statins and recording the highest absolute sales growth. The single-pill combination Co-Roswera supplements our statin product range, contributing the most to absolute sales growth. In 2024, we started marketing it in eight new countries, including Finland, Norway, and Greece. Co-Roswera was the leading single-pill combination of this type in Bulgaria, Croatia, Slovakia and several other markets. Our rosuvastatin sales accounted for a market share of over 25% in Regions Slovenia, Central, East and South-East Europe. We ranked among the leading manufacturers of generic rosuvastatin varieties in Europe also in 2024.
Our second major statin-based product is Atoris. It was one of our ten best-selling products and among six Krka products that surpassed the milestone of one billion tablets sold in 2024. Atoris sales accounted for a 30% of the atorvastatin market share in Regions Slovenia, Central, East, and South-East Europe, placing it second among statins, following our Roswera.
Employing a different mechanism of action, Ezoleta* is our other hypolipaemic. It remained the leading ezetimibe-based product in Slovenia and the Baltic states in 2024.
Statins are also incorporated in our single-pill combinations. In addition to single-pill combinations containing ezetimibe, we also market several combinations for lipitension. They combine hyperlipidemic and antihypertensive agents. Our portfolio comprises Valarox, a single-pill combination of a statin and a sartan, and two single-pill combinations of a statin and angiotensin-converting enzyme inhibitors, Roxiper and Roxampex*.
In addition to antihypertensives and hypolipaemics, we also market Bravadin (ivabradine), indicated for the treatment of stable angina pectoris and chronic heart failure, and a diuretic Apleria (eplerenone), which is also indicated for the treatment of chronic heart failure. Apleria outstripped all eplerenone-based products in Ireland, and was the only product with this active substance in Lithuania and Estonia. Capturing a market share of over 10%, Bravadin was the leading generic variety of ivabradine in Europe.
We also market Tezulix* (ranolazine) prolonged-release tablets for treating stable angina pectoris. We launched it in 2023. In 2024, we rolled it out also in Italy and Greece, and as the first generic manufacturer in Estonia. Our ranolazine was the leading generic variety in Germany and Portugal, and we outperformed all pharmaceutical companies in Latvia.
We were the leading provider of generic antidepressants in Slovakia, Czechia, and Croatia, outperforming all competitors in Slovenia and Estonia.
Dulsevia is our flagship antidepressant. In 2024, we started marketing it in Ukraine, and rolled out another strength (90 mg) in Romania. We remained the only provider of 90 mg tablets in Hungary, Czechia, and Slovenia. Capturing a market share of over 40%, it remained the leading duloxetine product in Regions Slovenia, Central, East, and South-East Europe. We further grew our market share as Dulsevia recorded the highest absolute sales growth of all duloxetine products. We ranked among the leading generic manufacturers of duloxetine in Europe.
In 2024, we were the leading manufacturer of antipsychotics in Slovenia and Latvia, and the leading generic provider in Slovakia.
Kventiax, our flagship antipsychotic, is available in tablets and prolonged-release tablets. In 2024, we also started marketing it in Ukraine. In Regions Slovenia, Central, East, and South-East Europe, it remained the leading quetiapine-based product. Capturing a market share of over 35% in Latvia, Estonia, Slovenia, and Slovakia, we were the leading provider of quetiapine. In the same area, our atypical antipsychotic Zalasta ranked among the leading generic varieties. Aryzalera from the same product group was the leading generic variety of aripiprazole. Zalasta was the leading olanzapine in the Russian Federation, Latvia, and Portugal. We were the leading manufacturer of aripiprazole in Romania and Slovenia, and ranked among the leading generic manufacturers in Italy.
We market Parnido tablets, our new antipsychotic. We were the leading manufacturer of paliperidone tablets in Italy, Sweden, Slovakia, and several other countries. We were the only paliperidone provider in Romania, while our tablets remained the leading generic variety of paliperidone in Europe. Our antipsychotic Zypsilan remained the leading generic variety of ziprasidone in Europe.
We market three medicines for the treatment of Parkinson’s disease: Oprymea (pramipexole), Rolpryna SR (ropinirole), and Ralago* (rasagiline). For years, we have been one of the leading generic manufacturers of those pharmaceuticals in Regions Slovenia, Central, East, and South-East Europe, further improving our position in 2024. We remained the leading generic manufacturer in Poland, and we captured a market share of almost 20% in Hungary, making us the leading provider of all anti-Parkinson agents. We were one of the leading manufacturers of generic varieties of rasagiline and ropinirole, outperforming all generic manufacturers of pramipexole.
Four of our oral agents are used to treat Alzheimer’s disease: Yasnal (donepezil), Marixino (memantine), Galsya (galantamine), and Nimvastid (rivastigmine). They are available in tablets and capsules, Yasnal and Nimvastid* also in orodispersible tablets. We were the only European manufacturer of rivastigmine in that pharmaceutical form.
In 2024, we were the leading generic manufacturer of memantine and galantamine in Europe. Marixino outperformed all memantine products in Slovenia, Serbia, and Lithuania. Galsya and Yasnal* ranked first in their respective categories in Slovakia, Ireland, and Slovenia. Like the year before, we were among the leading generic manufacturers of agents used for treating Alzheimer’s disease in Europe. We were the leading generic manufacturer in Slovenia, while in Slovakia, Lithuania, and Italy, we outperformed all pharmaceutical companies.
Our product portfolio also includes anxiolytics, antiepileptics and other central nervous system agents. Venturing into a new therapeutic area, we launched our first multiple sclerosis agent, Aregalu* (teriflunomide), for treating relapsing-remitting multiple sclerosis. We started marketing it in eight countries, including Slovenia, Germany, and Hungary. We were among the leading manufacturers of generic teriflunomide in Germany in 2024.
Nolpaza is our flagship medicine of this class, ranking among our five best-selling products. Nolpaza continued to be one of our six medicines that surpassed 1 billion tablets sold. The leading proton pump inhibitor in Regions Slovenia, Central, East, and South-East Europe, it captured a market share of over 13%. Nolpaza saw the highest absolute sales growth of all competing products, and we further grew its market share compared to 2023. It remained the leading pantoprazole-based product in 15 countries, while in the Russian Federation, Lithuania, Slovenia, and several other markets, it retained a market share of over 60%. We ranked among the leading manufacturers of generic pantoprazole varieties in Europe also in 2024. We also market it as a non-prescription product.
Emanera is our second major proton pump inhibitor and one of our ten best-selling products. In 2024, it ranked fourth among proton pump inhibitors in Regions Slovenia, Central, East, and South-East Europe. We remained the leading generic manufacturer of esomeprazole in the aforementioned regions, capturing a market share exceeding 25%. Emanera saw the sharpest increase of all esomeprazole products in year-on-year absolute sales. It was the leading medicine of this type in Ireland, Czechia, Croatia, and several other markets, and we were one of the leading generic manufacturers of esomeprazole in Europe. We also market it as a non-prescription product in certain markets.
| naproxen (Nalgesin*) | tramadol (Tadol*) | metamizole (Algominal) | pregabalin (Pragiola*) |
|---|---|---|---|
| diclofenac (Naklofen Duo*) | tramadol/paracetamol (Doreta*, Doreta* SR) | duloksetin (Dulsevia*) | dexketoprofen (Dekenor*) |
| oxycodone/naloxone (Adolax*) | etoricoxib (Roticox*) | tapentadol (Tapendolor*) | celecoxib (Aclexa*) |
Doreta* is our flagship prescription analgesic. It ranked among our ten best-selling products in 2024 again. We make it available in tablets and dispersible tablets, and as the only producer in several European markets, we also produce prolonged-release tablets. In 2024, we started marketing it in the United Kingdom and as the first generic variety in Latvia. We were the leading provider of tramadol/paracetamol single-pill combination in Germany, Romania, Poland and many other countries, and the only provider of this combination in Finland. We were the leading generic provider of the tramadol/paracetamol combination in Europe, the same as the year before. We further grew our market share to over 15%.
Nalgesin is a non-steroidal anti-inflammatory and antirheumatic medicine (NSAID). We also market it as a non-prescription product. Nalgesin outstripped all naproxen-based analgesics in the Russian Federation and Belarus, and was the only analgesic of this type in Slovenia, Croatia, Czechia, and Slovakia. It was the leading NSAID in Slovenia, and ranked among the leading medicines of this type in Croatia, Slovakia, and certain other countries. Like the year before, it remained the leading naproxen-based analgesic in Europe. We grew our market share to over 20%.
Naklofen Duo and two analgesics from the coxib sub-class, Roticox and Aclexa, are also our NSAIDs. The two coxibs were among the leading generic varieties in Europe. Roticox was the leading etoricoxib product in Hungary, Kazakhstan, and the Baltic states, and Aclexa was the leading celecoxib product in Poland, Finland, Ireland, and several other countries. We launched Roticox in Ukraine and Kazakhstan.
We launched Tapendolor*, our opioid analgesic, in 2023. We launched it in the United Kingdom and ranked among the leading generic manufacturers of tapentadol in Europe in 2024. We are among the leading providers of generic varieties of tapentadol in Portugal and the only generic provider in Ireland and Slovakia.
Our two agents, an antidepressant Dulsevia and an antiepileptic Pragiola are often used in neuropathic pain therapy. Pragiola* was the main generic variety of pregabalin in Slovenia, Austria, and Slovakia. It outperformed all pregabalin products in Estonia. Algominal supplements the portfolio of our analgesics.
Our primary antidiabetic agents are classified as dipeptidyl peptidase-4 (DPP-4) inhibitors. These state-of-the-art agents have excellent safety profiles and can be used already at the earliest stages of diabetes, either in monotherapy or combined with other agents. We were marketing them on 34 markets last year. In Regions Slovenia, Central, East, and South-East Europe, we were among the leading generic manufacturers of DPP-4 inhibitors, and we were the leading generic manufacturer in Poland.
Sitagliptin is our flagship agent in this class. Our product portfolio includes Maysiglu (sitagliptin) and the single-pill combination Maymetsi (sitagliptin/metformin). We launched them in 2022 and rolled them out in new markets in 2024, in Kosovo, and Azerbaijan, and as the first generic provider in Moldova. Our sitagliptin remained the leading sitagliptin product in the Russian Federation and was among the leading generic sitagliptin varieties in Europe.
Our other antidiabetic agents are two vildagliptin-based products, Glypvilo (vildagliptin) and Vimetso (vildagliptin/metformin). We launched them in the Russian Federation and introduced Vimetso* as the first generic single-pill combination of vildagliptin and metformin in Azerbaijan. Our vildagliptin remained the leading vildagliptin product in Poland, and ranked among the leading vildagliptin-based products in Norway and Sweden.
In 2024, we started marketing our first antidiabetic from the sodium-glucose co-transporter 2 (SGLT2) inhibitor class. These state-of-the-art agents effectively reduce glycated haemoglobin levels and have positive effects on the cardiovascular system and kidney function. We rolled out Dagrafors* (dapagliflozin) in Iceland and became the first generic manufacturer in North Macedonia, and Bosnia and Herzegovina.
The antidiabetic agent Gliclada (gliclazide) is a sulphonylurea. It is the only gliclazide in prolonged-release tablets in Europe, and is available in three strengths. We were the leading provider of generic varieties of gliclazide in Poland, Portugal, Ireland, and several other countries, while Gliclada outperformed all gliclazide products in Slovenia, Czechia, and the Baltic states. We ranked among the leading generic manufacturers of gliclazide in Europe in 2024.
Russian Federation, Slovenia, Croatia, and Lithuania. We were among the leading generic manufacturers of dabigatran in Europe last year.
Xerdoxo* (rivaroxaban) is one of the most advanced anticoagulants, which we market in several strengths indicated for treating various conditions. In 2024, we made available a new strength of 2.5 mg rivaroxaban, indicated in combination with other medicines to prevent atherothrombotic events. We first marketed it on ten markets and rolled it out as the first generic variety in Germany, Poland, Slovenia, and Estonia. We also launched other strengths in new markets, in the Russian Federation and Uzbekistan.
Another antiaggregant is Zyllt (clopidogrel), which we market in over 40 countries. Zyllt was the leading generic variety of clopidogrel in the Russian Federation, Latvia, and Armenia. In Finland, Hungary, and several eastern European markets, our clopidogrel outperformed all clopidogrel products.
Eliskardia (prasugrel) and Atixarso (ticagrelor) supplement the portfolio of our antiaggregant medicines. In 2024, we were the leading provider of prasugrel in Germany, Norway, and Slovakia. We extended the marketing reach of our ticagrelor, and made it available in Iceland and Estonia.
We marketed ten oncology agents, primarily small-molecule oral dosage forms indicated for the most common cancer types, such as various types of leukaemia, prostate cancer, and breast cancer.
Our flagship agent in this class is Abiratel* (abiraterone), which is indicated for treating metastatic prostate cancer. In 2024, we were among the leading generic manufacturers in Slovenia, Germany, and Poland, while our abiraterone outstripped all abiraterone products in Croatia and Finland.
We also made available our new oncology agent Pomadel (pomalidomide). It is used in combination with other medicines to treat multiple myeloma. We made it available in eight countries and as the first generic variety in Germany, Slovenia, Spain, the Netherlands, and Hungary. Lenabdor (lenalidomide) is another agent indicated for treating multiple myeloma, and we also made it available in Ukraine. We were one of the leading providers of generic varieties of lenalidomide in Slovenia, Belgium, Sweden, and several other countries, and our lenalidomide outstripped all other lenalidomide products in Poland.
Meaxin (imatinib) and Dasatilen (dasatinib) are two oncology agents indicated for treating various types of leukaemia. Meaxin remained the leading generic variety of imatinib in Slovenia, and surpassed all imatinib products in Latvia. It was among the leading varieties in Ukraine, Italy, Poland, and several other markets. Dasatinib Krka ranked among the leading dasatinib varieties in Slovakia, Finland, Romania and other countries, while in Slovenia, much as in the year before, it remained the leading generic variety.
In addition to agents acting directly on cancer cells, we also market certain complementary medicines. Orlixon* (dexamethasone) is used in oncology, haematology, and other therapeutic areas. It is available in tablet form and as a solution for injection. We remained the only provider of 40 mg dexamethasone tablets and the leading dexamethasone provider in Germany, Spain, and the entire area covered by Regions Slovenia, Central, East, and South-East Europe.
In 2024, the Krka Group sales of non-prescription products totalled €171.3 million, a 3.4% year-on-year drop. A weaker cold season in eastern Europe caused the drop in sales value.
In 2024, we recorded the highest absolute sales increases in Slovenia, Poland, and Germany.
We market non-prescription products through our dedicated marketing and sales network in most countries of Regions Central, East, and South-East Europe.
Septolete, Nalgesin, Herbion, and Septanazal were our primary product brands in terms of sales.
Septolete remained our leading non-prescription product brand in 2024 and one of the ten best-selling products. Septolete Total (benzydamine/cetylpyridinium chloride) is available in spray and lozenges. We market three lozenge flavours: eucalyptus, elder-and-lemon, and honey-and-lemon. We also launched Septolete Total honey-and-lemon and elder-and-lemon flavoured lozenges in Germany. Septolete Total* ranked first among oral cavity and pharynx remedies in Lithuania, Belarus, and Kyrgyzstan. End-users awarded us the Brand No 1 title in the sore throat product category in the Russian Federation.
Nalgesin, an analgesic, is our second major non-prescription product brand. Nalgesin (naproxen) remained one of the leading analgesics of the NSAID product group in Regions Slovenia, Central, East, and South-East Europe. It remained the leading non-prescription analgesic of this product group in Slovenia, and one of the leading varieties in the Russian.
| 0 | 25 | 50 | 75 | 100 | 125 | 150 | |||
|---|---|---|---|---|---|---|---|---|---|
| 0 | 10 | 20 | 30 | 40 | 50 | 60 | |||
| Russian Federation | Slovenia | Uzbekistan | Ukraine | Poland | Romania | Kazakhstan | Germany | Croatia | Belarus |
| € million | 2020 | 2021 | 2022 | 2023 | 2024 | Index 2024/23 |
|---|---|---|---|---|---|---|
| Cough and cold | 46.4% | |||||
| Analgesics | 21.5% | |||||
| Vitamins and minerals | 11.7% | |||||
| Cerebral and peripheral circulation | 5.8% | |||||
| Gastrointestinal tract and metabolism | 5.5% | |||||
| Vasoprotectives | 3.8% | |||||
| Other | 5.3% |
Federation, the Baltic states, Slovakia, and certain other markets. Nalgesin* remained the leading naproxen-based medicine in Europe. We also make it available as a prescription pharmaceutical.
Herbion, our third major non-prescription product brand, also belongs to the cough-and-cold product group. It comprises herbal syrups for various types of cough. Herbion Ivy Syrup and Herbion Cowslip Syrup facilitate expectoration, while Herbion Plantain Syrup relieves dry, irritating coughs. Herbion Iceland Moss Syrup also relieves sore throat and hoarseness, as well as dry, irritating cough. Herbion Ivy Lozenges act much like the syrup and help expectoration. This pharmaceutical form is especially suitable for adults. The brand remained one of the three leading cough-and-cold product brands in Slovenia and parts of central, eastern, and south-eastern Europe, and remained the leading of all herbal brands and natural syrups in 2024. It was one of the leading cough brands in Estonia and several eastern European markets, and the leading cough product in Moldova.
Septanazal* (xylometazoline/dexpanthenol) is a nasal decongestant available as a spray for adults and a spray for children. We market it in 29 European countries. It was one of the leading sprays in this category in Slovenia and Lithuania, and first in Moldova and Latvia, where its market share increased to almost 25%.
Bilobil, which contains the ginkgo leaf extract, belongs to the peripheral vasodilator product group and is indicated for slowing the progression of cognitive decline. We market it in 26 markets across Europe and the Middle East. Bilobil was among the leading ginkgo-based products in Regions Slovenia, Central, East and South-East Europe, and ranked first among products in its class in Bosnia and Herzegovina and Ukraine. In Slovenia, it ranked first among all memory-and-concentration brand products.
Vitamins and minerals constitute a great part of our non-prescription product portfolio. Pikovit and Duovit are our brands of vitamins and minerals. We recorded strong sales of Pikovit, especially in Region East Europe where it remained one of the leading brands of vitamins and minerals for children. Vitamin D3 Krka (cholecalciferol) is indicated for treating and preventing vitamin D deficiency. In Slovenia, it remained the leading cholecalciferol-based product in pharmacies, capturing a market share of over 40%. Our food supplement Magnezij Krka is available in water-soluble granules. Last year, we expanded our magnesium portfolio with a new pharmaceutical form, Magenzij Krka DIREKT powder, designed for direct oral use without liquid. We launched it in Slovenia, where Magnezij Krka products captured a market share of 55%, securing the top position among magnesium brands in pharmacies.
Nolpaza Control (pantoprazole) and Emozul Control (esomeprazole) are two proton pump inhibitors within the gastrointestinal tract and metabolism product group. We also market the two products as prescription pharmaceuticals. Nolpaza Control was one of the leading non-prescription products for the gastrointestinal tract, capturing a market share of almost 30% and ranking first in that category in Slovakia and Lithuania. Emozul Control was one of the leading products of this category in Lithuania and Hungary.
We launched a new product for immune support in 2024. A food supplement Imunogard Krka contains beta-glucan, vitamins, and minerals. It is available in powder for use in water or tea. Our product portfolio contains Imunogard Krka Junior for children in addition to the product for adults.
In 2024, the Krka Group sales of animal health products amounted to €111.8 million, a 6.9% year-on-year climb. Sales generated in the Russian Federation, Spain, and Poland were the primary drivers of growth.
In Regions Slovenia, Central, East, and South-East Europe and most markets of Region West Europe, we use our dedicated marketing and sales network for selling our animal health products. On other markets of Region West Europe and Overseas Markets, we sell them through our partners.
In 2024, the combination of milbemycin and praziquantel (Milprazon) remained the best-selling animal health product, followed by products containing fipronil (Fypryst, Fypryst Combo) and selamectin (Selehold).
We produce animal health products for farm animals and companion animals. Products for companion animals, which accounted for over 70% of animal health sales last year, were the primary drivers of sales growth.
| € million | 2020 | 2021 | 2022 | 2023 | 2024 | Index 2024/23 |
|---|---|---|---|---|---|---|
| Russian Federation | 58.5% | 11.9% | 4.5% | 18.2% | 3.7% | 3.2% |
| United Kingdom | ||||||
| Poland | ||||||
| Spain | ||||||
| Ukraine | ||||||
| Germany | ||||||
| France | ||||||
| Czechia | ||||||
| Croatia | ||||||
| Slovenia |
Spot-on solutions accounted for the majority of our companion animal product range. Our primary branded spot-on is Fypryst. Fypryst (fipronil) is also available as a cutaneous spray. Fypryst Combo (fipronil/S-methoprene) complements the range. Fypryst is our second major animal health product brand. Last year, we increased its sales by more than 30%, making it the primary driver of absolute animal health product sales.
Another antiparasitic for companion animals, the endectocide Selehold* (selamectin), is available as a spot-on solution. It is used for treating and preventing infestations with endo- and ectoparasites. We recorded the strongest sales in the Russian Federation, Ukraine, and the United Kingdom. Last year, it was our third-best-selling animal health product.
Another spot-on solution from the antiparasitic class for treating ectoparasite infestations in dogs is Ataxxa (imidacloprid/permethrin). In 2024, its sales more than doubled. Ataxxa saw the sharpest sales increases in Spain and the Russian Federation. It was our second most significant animal health product in terms of absolute sales growth.
Prinocate* (imidacloprid/moxidectin) spot-on solution is also our endectocide for companion animals. This double fixed-dose combination is indicated for treating endo- and ecto-parasites in dogs and cats. It is our newest spot-on and recorded the strongest 2024 sales in the United Kingdom.
Our portfolio of antiparasitic agents for companion animals includes the Dehinel brand products, our fifth-best-selling animal health brand. We market Dehinel Plus (febantel/pyrantel/praziquantel) for small dogs and Dehinel Plus XL for large dogs. Our dog range also includes flavoured tablets Dehinel Plus Flavour. We also market Dehinel* (pyrantel/praziquantel) for cats.
Cladaxxa (amoxicillin/clavulanic acid), a fixed-dose combination, is our primary antibiotic of antimicrobial agents for companion animals. Chewable tablets, available in three strengths, are indicated for treating bacterial infections of the skin, gums, respiratory tract, urinary tract, and intestines in cats and dogs. We launched Cladaxxa in 2022, and it was our third most significant animal health product in terms of absolute sales growth last year. Its sales increased by more than 70% in 2024.
In 2024, we launched a new triple combination Otomicol (miconazole/prednisolone/polymyxin) for companion animals. Otomicol is indicated for otitis externa in dogs and cats, and primary and secondary skin and skin adnexa infections in dogs, cats, and guinea pigs. We launched it in Slovenia, the United Kingdom, Poland, Portugal, and three other countries, making a total of seven.
Robexera (robenacoxib) chewable tablets for dogs is our latest addition to medicines for veterinary use for companion animals. This nonsteroidal anti-inflammatory agent from the coxib class is indicated for relieving pain and treating inflammation associated with chronic osteoarthritis and soft tissue surgeries. We first launched it in 2023, and last year made it available as the first provider of generic medicines also in the Russian Federation and Ukraine. Robexera was among our leading medicines for veterinary use in terms of absolute sales growth. Rycarfa (carprofen), available in tablets and as a solution for injection, is an analgesic from our companion animal product range.
Terme Krka’s sales revenue totalled €49.4 million at the end of 2024, up 3.5% year on year. Despite undergoing an extensive six-month refurbishment, the Talaso Strunjan business unit contributed the largest share, 32%, of overall sales revenue. Overall, we recorded 342,176 overnight stays, up 2% from the previous year. Overnight stays by foreign guests rose by 3%, accounting for 11% of the guest structure. Wellness programmes were in high demand among foreign guests, with the majority from Italy, Croatia, and Germany. Medical wellness programmes contributed the most to total sales revenue, accounting for 36%.
| APIs | Brands |
|---|---|
| amlodipine | Alneta, Amlobe, Amlodinova, Besyloc, Hipres, Hypress, Tenox |
| aripiprazole | Arisppa, Aryzalera, Zylaxera |
| atorvastatin | Astator, Atoridor, Atoris |
| atorvastatin/amlodipine | Amaloris, Atorcombo, Atordapin |
| bismuth | Ulcamed, Ulcavis, Ulkavis |
| bisoprolol | Niperten, Sobyc, Sobycor, Zonsiloc |
| bisoprolol/amlodipine | Bisodipin, Niperten Combi, Sobycombi |
| candesartan | Candecor, Canocord, Karbis |
| candesartan/amlodipine | Camdero, Camlocor, Candecam, Kandoset |
| candesartan/hydrochlorothiazide | Cancombino, Candecor, Canocombi, Karbicombi |
| carvedilol | Carvetrend, Coryol |
| celecoxib | Aclexa, Dilaxa |
| dabigatran | Dabixom, Danengo, Daxanlo |
| dexketoprofen | Dekendol, Dekenor, Dexfenia |
| diclofenac | Naklofen, Naklofen Duo |
| donepezil | Yasnal, Yasnal Q-Tab, Yasnoro, Yradan |
| duloxetine | Duloxalta, Duloxenta, Dulsevia, Dulvas, Loxentia |
| enalapril | Corvo, Enap |
| enalapril/hydrochlorothiazide | Corvo HCT, Enap-CO, Enap-H, Enap-HL |
| enalapril/lercanidipine | Elernap, Elyrno, Enacanpin |
| eplerenone | Apleria, Enplerasa, Riolma |
| escitalopram | Ecytara, Elicea, Elicea Q-Tab, Escitalex |
| esomeprazole | Emanera, Emozul, Escadra, Esolib, Esozoll, Ezoprole |
| etoricoxib | Bericox, Etoriax, Etoxib, Myox, Roticox |
| ezetimibe | Ezetad, Ezoleta |
| ezetimibe/simvastatin | Ezesimin, Vasitimb, Vasitimib |
| galantamine | Galnora, Galsya, Galsya SR |
| gliclazide | Diacronal MR, Dynacaz MR, Gliclada, Gliclada SR, Glubitor-OD, Gluclazide, Glyclada |
| imatinib | Imanivec, Itivas, Meaxin, Neopax |
| indapamide | Icorvida SR, Rawel SR |
| irbesartan | Ifirmasta, Irabel |
| irbesartan/hydrochlorothiazide | Co-Irabel, Ifirmacombi, Irbecor |
| ivabradine | Bixebra, Bravacor, Bravadin, Brivecor, Ivabalan, Valheart |
| lansoprazole | Gastevin, Lancap, Lansoptol, Lanzul, Zoletad |
| losartan | Lavestra, Lorista |
| losartan/amlodipine | Alortia, Lortenza, Telorssa, Tenloris |
| losartan/hydrochlorothiazide | Lavestra H, Lavestra HCT, Lorista H, Lorista HD, Lorista HL |
| memantine | Marixino, Maruxa, Maryzola, Memando, Memaxa, Mentixa |
| metoprolol | Bloxan, Bloxazoc, Metazero, Metazero XR |
| APIs | Brands |
|---|---|
| mirtazapine | Mirtin, Mirzasna, Mirzaten, Mirzaten Q-Tab, MirzatenOro-Tab |
| naproxen | Analgesin, Analgesin Forte, Nalgesin, Nalgesin Forte, Naprosyn |
| olanzapine | Zalasta, Zalasta Q-Tab, Zolrix |
| olmesartan | Olimestra, Olmecor |
| olmesartan/amlodipine | Olmeamlo, Olssa, Polaplom |
| olmesartan/amlodipine/hydrochlorothiazide | OlmeAmlo HCT, Olsitri, Polaplom HCT |
| olmesartan/hydrochlorothiazide | Co-Olimestra, Olmecor HCT |
| omeprazole | Medoome, Ultop |
| oxycodone/naloxone | Adolax, Oxycaloxon, Oxynador |
| perindopril | Perineva, Prenessa, Prenessaneo |
| perindopril/amlodipine/rosuvastatin | Rosamera, Roxampex, Roxatenz-amlo |
| perindopril/amlodipine | Amlessa, Amlessa Neo, Amlessini, Aramlessa, Dalnessa, Dalneva, Peramlonorm, Predalneva, Tonarssa, Tonarssa Neo |
| perindopril/amlodipine/indapamide | Amlewel, Co-Amlessa, Co-Amlessa Neo, Co-Amlessaneo, Coaramlessa, Co-Dalnessa, Co-Dalneva, Tonanda, Tonanda Neo |
| perindopril/indapamide | Comaranil, Co-Perineva, Coprenessa, Co-Prenessa, Co-Prenessa Neo, Co-Prenessaneo, Prenewel, Prenewel Neo |
| perindopril/indapamide/rosuvastatin | Roxatenz-Inda, Roxiper, Triemma |
| prasugrel | Eliskardia, Prasillt, Sigrada |
| pregabalin | Apregia, Pragiola, Pregabador, Pregabio, Rewisca |
| quetiapine | Kventiax, Kventiax Prolong, Kventiax SR, Quentiax, Quentiax SR |
| rabeprazole | Gelbra, Zulbex |
| ramipril | Ampril, Amprilan |
| ramipril/amlodipine | Rameam, Ramidipin |
| ramipril/hydrochlorothiazide | Ampril HD, Ampril HL, Amprilan H, Amprilan HD, Amprilan HL, Marilamed |
| rasagiline | Raglysa, Ralago |
| risperidone | Rorendo, Rorendo Oro-Tab, Torendo, Torendo Q-Tab, Zoxadon |
| rivaroxaban | Rivarolto, Rivaroxia, Rozarya, Xerdoxo |
| ropinirole | Ralnea, Ralnea XL, Rolpryna, Rolpryna SR |
| rosuvastatin | Rosuvador, Roswera, Roxera, Sorvasta |
| rosuvastatin/ezetimibe | Co-Rosuvador, Coroswera, Co-Roswera, Co-Roxera, Rosazimib, Roswera Combi, Roxera Plus, Sorvasta Plus, Sorvitimb |
| sertraline | Asentra, Sertrone |
| simvastatin | Sivales, Vasilip |
| sitagliptin | Asiglia, Maysiglu, Sitagavia |
| sitagliptin/metformin | Asigefort, Asiglia Met, Maymetsi, Sitagavia Met |
| tapentadol | Apeneta, Tapendolor |
| telmisartan | Telmista, Tolura |
| telmisartan/amlodipine | Tamloset, Telassmo, Teldipin, TelmistaAM |
| telmisartan/amlodipine/hydrochlorothiazide | Telmista Trio, Tolutris, Tolvecamo |
| telmisartan/hydrochlorothiazide |
| APIs | Brands |
|---|---|
| benzydamine/cetylpyridinium chloride | Septabene, Septafar, Septo, Septolete Duo, Septolete Extra, Septolete Junior, Septolete Omni, Septolete Total, Septolete Ultra |
| esomeprazole | Emanera, Emozul Control, Esozoll |
| Iceland moss extract | Herbion Iceland Moss, Herbisland |
| ginkgo leaf extract | Bilobil, Gingonin |
| ivy leaf extract | Herbion Ivy Syrup, Herbihelix |
| xylometazoline/dexpanthenol | Septanazal, Septanasal |
| magnesium citrate | Magnesol, Magnezij Krka 300, Magnezij Krka 400, Magnezij Krka Direkt |
| naproxen | Analgesin, Ilgesin, Naldorex, Nalgedol, Nalgesin Mini, Nalgesin Relief, Nalgesin S |
| pantoprazole | Nolpaza Control, Sedipanto |
| APIs | Brands |
|---|---|
| enrofloxacin | Enrox, Enroxal, Enroxil |
| febantel/pyrantel/praziquantel | Anthelmin Plus, Dehinel Plus, Wormscreen Plus |
| fipronil | Amflee, Fleaaway, Fyp, Fyperix, Fypryst |
| fipronil/S-methoprene | Amflee Combo, Fleascreen Combo, Fyperix Combo, Fypryst Combo, Vetbox Combo |
| imidacloprid/moxidectin | Imoxicate, Prinocate |
| carprofen | Karprovet, Rycarfa |
| marbofloxacin/clotrimazole/dexamethasone | Otox, Otoxolan |
| milbemycin/praziquantel | Milpra Plus, Milprazin, Milprazon, Milprazon Chewable, Milprazon Plus, Milquantel |
| imidacloprid/permethrin | Ataxa, Ataxxa |
| pyrantel/praziquantel | Anthelmin, Dehinel, Wormscreen |
| selamectin | Selafort, Selehold |
vertical integration and the synergy between our development and production expertise. By overseeing the entire process, we can ensure the timely introduction of high-quality, safe, and effective medicines into over 70 markets. By the end of 2024, our portfolio comprised 1000 products in various dosage forms and strengths. There are about 170 projects at different development stages aiming to extend our range of medicines in key therapeutic classes, such as medicines for treating high blood pressure, diabetes, blood and blood-forming organs, and cancer. This enables us to contribute to the wide availability of high-quality medicines, aligning with one of the primary United Nations Sustainable Development Goals (SDG).
We employ a project management and development strategy to maintain the highest product quality across all life-cycle phases and markets. By understanding regional and national legislative requirements, we can anticipate each market’s specific needs and tailor our development processes and mandatory research from the early development stages. This approach underscores our commitment to social responsibility by guaranteeing a modernised portfolio of medicines across all our markets, including financially disadvantaged regions or countries (low- or medium-income), within the shortest feasible timeframe. Currently, we provide over 50 medicines from the WHO Model List of Essential Medicines 2023 in middle- and low-income countries.
By introducing trends and scientific advancements in various areas of expertise, we can respond quickly and appropriately to development challenges and patients’ needs. We introduce new and improved development approaches, where we also cooperate with external partners. Our emphasis lies in collaborating with educational and R&D institutions, fostering a continuous exchange of expertise between academia and industry. Through this partnership, we facilitate the professional development of our employees, drive innovation forward and thus improve development and high quality in both segments.
As a responsible pharmaceutical company, our products and technologies are the culmination of cutting-edge expertise and rigorous scientific endeavours. We actively collaborate with EDQM (European Directorate for Quality of Medicines and Healthcare), especially by establishing quality standards of active pharmaceutical ingredients (APIs) in Europe and globally. Some of Krka’s APIs are certified as European reference standards and some analytical methods are included in monographs of essential APIs.
New products are supported by safety and effectiveness studies. We conduct clinical trials in line with the applicable legal requirements, good practice guidelines, the Helsinki Declaration, and Regulation (EU) 2016/679 (General Data Protection Regulation). Regulatory and inspection authorities validate the assurance of participant safety, transparency, ethical standards, and high-quality research. Quality is paramount for our products, starting from the early development stages. We ensure all development activities adhere to established quality systems, which we consistently update and enhance.
With a strong commitment to the environment, we prioritise simple and energy-efficient technological solutions that also enhance our products’ affordability. Our products are designed to comply with our environmental policy and the ISO 14001 standard. We ensure that technological procedures have a minimal environmental impact through measures to reduce our carbon footprint, water consumption, and organic solvent use and, in doing so, align our efforts with circular economy objectives.
We also make significant investments in data science and technology. In 2024, we advanced the digitisation of R&D data and expanded the implementation of a unified Laboratory Information Management System (LIMS). We also pursued research and integration of modern solutions, such as modelling and simulation, across all areas of development. We continued the robotisation project in analytical lab processes, accelerating analyses and minimising the likelihood of errors.
In developing our pharmaceuticals, we are cognisant of improving patient health and quality of life. We develop complex products in innovative pharmaceutical forms with added value. We focus on single-pill combinations, which contain two or more active substances that provide double or triple therapy to our patients. Our portfolio includes 150 combination medicines, representing a significant focus of our development projects. We develop generic and novel combinations of established active substances. Reducing our environmental footprint is another advantage of combination medicines over tablets with one active substance, as we use less excipients, packaging material, and energy to produce these single-pill combinations. Yet, they require state-of-the-art technological solutions at the production scale and complex analytical evaluations, including clinical studies.
In 2024, we continued investing in physico-chemical analytics, cell test know-how, and laboratory equipment to develop in-house analytical methods and other development projects involving complex peptide-based therapeutics. Through collaboration with diverse partners, we enhanced our expertise and capabilities in transferring production procedures of complex products to an industrial scale and developing orthogonal analytical methods. We confirmed our approach to the development and preparation of registration documentation of complex products by consulting with regulatory authorities. We leveraged our comprehensive development studies on established products, adjusted development activities accordingly, integrated our development and manufacturing operations, and gathered information about regulatory and marketing requirements to further our entry into the Chinese market. In 2024, seven new products received regulatory approval in this region.
Once again, the wider community recognised our researchers’ achievements. At the national level, we received two innovation awards from the Slovenian Chamber of Commerce and Industry for advancements in API synthesis and finished dosage form development. The gold award recognised our innovation in tapentadol prolonged-release tablets for severe pain relief, Pain Disables, Knowledge Enables, while the silver award honoured our development of dabigatran for treating and preventing thromboembolic events, From Lab to Patient: Innovating Krka’s Dabigatran Medicine.
In 2024, we filed nine patent applications for new technological solutions we had developed and evaluated as inventions at the global ranking level. Based on priority applications from 2023, we filed seven international and two European patent applications. We were granted four patents in various countries. Overall, more than 200 valid patents protect Krka’s technological solutions.
We filed 134 applications for Krka trademarks in Slovenia. We also filed 75 international and 34 national trademark applications. Overall, we have registered trademarks for more than 1,100 different signs across multiple countries.
In 2024, we expanded our product range with twenty-two new products, including eighteen new prescription pharmaceuticals, three additions to our portfolio of non-prescription products and food supplements, and one veterinary medicine.
In 2024, we finalised over 1,000 registration procedures for both new and already established products. We received approvals for more than 24,000 regulatory variations to ensure an uninterrupted supply of our products to various markets.
We obtained the first marketing authorisations for 18 new products and were granted additional new marketing authorisations for our established products in additional markets.
angiotensin II receptor blocker, and indapamide, a diuretic. This medicine is taken once daily and provides stable blood pressure control in patients who have already been treated with candesartan and indapamide. We concluded marketing authorisation procedures for Valomindo (valsartan/indapamide) 80 mg/1.5 mg modified-release tablets, a new strength of this blood pressure lowering agent, and Co-Atoris (atorvastatin/ezetimibe) film-coated tablets indicated for treating hypercholesterolaemia and prevention cardiovascular events in patients with coronary heart disease (CHD) and a history of acute coronary syndrome (ACS). We were also granted marketing authorisations for a triple single-pill combination Co-Amlessa Neo* (perindopril arginine/amlodipine/indapamide) tablets. Our new perindopril formulation allows for personalised treatment adaptation to meet individual patient needs in several countries.
As the first generic manufacturer, we concluded DCP procedures for our antithrombotic agent Delianda (edoxaban) film-coated tablets. Edoxaban is a modern antithrombotic agent. Its advantages include a lower risk of bleeding and once-daily dosing, which ensures good patient adherence to treatment.
We obtained marketing authorisations for our contemporary central nervous agent, Varesta (vortioxetine) film-coated tablets indicated for treating major depressive episodes in adults. Vortioxetine differs from other antidepressants in its mechanism of action, which simultaneously modulates neurotransmission in several systems, and is, therefore, a medicine of choice for patients with severe forms of the disease.
We were granted marketing authorisations for Apremilast Krka (apremilast) film-coated tablets to safely and effectively treat moderate to severe chronic plaque psoriasis in adult patients. It is also indicated for treating active psoriatic arthritis and oral ulcers associated with Behçet’s disease.
We also obtained marketing authorisations for Eltrombopag Krka (eltrombopag) film-coated tablets. It is indicated for treating various types of thrombocytopenia and severe aplastic anaemia.
Under the centralised procedure, marketing authorisation was granted for Pomalidomide Krka (pomalidomide) hard capsules, an oncology agent. It is indicated for treating adult patients with advanced forms of multiple myeloma as it reduces signs and symptoms and slows disease progression.
We developed and authorised a new strength of Vitamin D3 Krka (cholecalciferol) 30,000 IU tablets, which are indicated for preventing and treating vitamin D deficiency and as adjunctive therapy in treating osteoporosis. The new strength helps tailor the treatment to patients’ needs. We are among the few manufacturers whose vitamin D products are authorised as pharmaceuticals. This is particularly noteworthy, as lower potency products are commonly marketed as food supplements.
We also received approvals for Nalgesin Duo (naproxen/paracetamol) film-coated tablets, our innovative single-pill combination indicated for relieving mild to moderate pain. This is the first marketing authorisation for the single-pill combination of naproxen and paracetamol in the Russian Federation. We also supported it with our clinical study.
We obtained marketing authorisations for several new products in China. Marketing authorisations were granted for two cardiovascular single-pill combinations, our new valsartan/amlodipine film-coated tablets for treating hypertension and atorvastatin/amlodipine film-coated tablets for the concomitant treatment of arterial hypertension and hyperlipidemia. We obtained marketing authorisations for our bisoprolol-based film-coated tablets, one of the essential therapies for many cardiovascular conditions, for example, hypertension, coronary artery disease, and heart failure. In addition, we received approvals for our three combinations in film-coated tablets containing hydrochlorothiazide and contemporary angiotensin II receptor blockers: a combination of losartan and hydrochlorothiazide; a combination of valsartan and hydrochlorothiazide; and a combination of olmesartan and hydrochlorothiazide. We obtained marketing authorisations for a central nervous system agent, aripiprazole tablets. This atypical antipsychotic is associated with fewer adverse drug reactions than other agents from the same product group.
In 2024, new marketing authorisations were also granted for established products in additional markets. Among them was Tolurindo* (telmisartan/indapamide) modified-release tablets in European Union markets. This single-pill combination is indicated in patients with high blood pressure who already take the two active substances in two separate tablets. It is taken once daily, providing a significant improvement for patients with concomitant diseases who require multiple medications.
Additional marketing authorisations were also granted for medicinal products for treating cardiovascular diseases and diabetes in countries of eastern Europe. We obtained marketing authorisations in several markets for our single-pill combination Co-Roswera/Roxera Plus (rosuvastatin/ezetimibe) film-coated tablets, indicated for hyperlipidemia. Last year, we successfully completed the majority of authorisation procedures for documentation upgrades in compliance with the Eurasian Economic Union (EAEU) legislation in the Russian Federation. This allows us to continue marketing our products in the Russian market and facilitates moves into other markets within the EAEU.
In the markets of south-eastern Europe, marketing authorisations were granted for a contemporary anti-diabetic agent Dagrafors (dapagliflozin) film-coated tablets. Marketing authorisations were also granted for several cardiovascular agents, notably the single-pill medicine Valomindo (valsartan/indapamide) modified-release tablets and anticoagulant Aboxoma (apixaban) film-coated tablets.
In the Overseas Markets, we last year finalised more than 90 marketing authorisation procedures for medicinal products from different therapeutic classes, most in the class of medicines for cardiovascular diseases.
In 2024, we added three new products to our non-prescription products and food supplements portfolio. Herbion Iceland Moss lozenges contain dry extract of Iceland moss dry extract, relieve irritation of the mucosa in the throat and mouth and the associated dry cough, and can be taken by adults and adolescents 12 years of age and older.
We added two new products to our portfolio of food supplements. They contain beta-glucan and a combination of vitamins and minerals for immune support. Imunogard Krka Junior strawberry-flavoured powder for solution contains beta-glucan, vitamins A, C, D, and zinc, and is intended for children aged three years and older. Imunogard Krka lemon-flavoured powder for solution contains beta-glucan, vitamins C, A, D, B6, B9, and B12, and minerals zinc, selenium, and manganese. It can be taken by adults and adolescents aged 14 years and older.
We received approvals in new markets for Septolete Total (benzydamine/cetylpyridinium chloride) lozenges, Septanazal (xylometazoline/dexpanthenol) nasal spray, and Nolpaza Control (pantoprazole) gastro-resistant tablets. We obtained additional approval for Emanera Kontrol (esomeprazole) gastro-resistant capsules and obtained the first marketing authorisation for Vitamin D3 (cholecalciferol) 7,000 IU tablets available as a non-prescription product.
We are expanding treatment options for companion animals with new products across various therapeutic areas. We obtained marketing authorisations for Otomicol (miconazole nitrate/prednisolone acetate/polymyxin B sulphate) ear drops and cutaneous suspension. This triple-combination product is indicated for treating primary and secondary skin and skin adnexa infections in dogs, cats, and guinea pigs, as well as for treating otitis externa in dogs and cats.
inflammation, and to control inflammation and pain after soft tissue surgical procedures in dogs. Milprazon Chewable (milbemycin oxime/praziquantel) palatable chewable tablets for dogs and Milprazon Chewable (milbemycin oxime/praziquantel) chewable tablets for cats are used to treat and prevent internal parasite infections. Triple combination medicine Dehinel Plus Flavour (febantel/pyrantel/praziquantel) flavoured tablets is indicated for treating internal parasite infections in dogs, and Ataxxa (imidacloprid/permethrin) spot-on solution is a combination indicated for treating and preventing external parasite infections in dogs. New marketing authorisations were also granted for Prinocate (imidacloprid/moxidectin) spot-on solution, a combination indicated for treating and preventing internal and external parasite infections in dogs and cats; Cladaxxa (amoxicillin/clavulanic acid) tablets indicated for treating bacterial infections in dogs and cats, Otoxolan (marbofloxacin/clotrimazole/dexamethasone) suspension for ear drops for dogs to treat otitis externa in dogs, and for Tuloxxin (tulathromycin) solution for injection for treating bacterial infections in cattle and pigs.
We completed the renovation of the third floor, kitchen with restaurant, and reception room at Hotel Svoboda, part of the Talaso Strunjan business unit, aligning with our strategy of gradual and systematic service improvement. Additionally, we expedited project designs for the complete renovation of Hotel Vital in Terme Dolenjske Toplice and plan to enhance and diversify our wellness service portfolio.
The key objective of the production and supply chain is to satisfy market demand by providing sufficient quantities of quality products in a timely and cost-effective manner. To meet this objective, we promptly address shifting market demands, continuously enhance processes to reduce lead times throughout the supply chain, and integrate supply processes across all Krka Group subsidiaries and our partners’ production sites.
We ensure compliance with new product manufacturing requirements and applicable laws by promptly introducing advanced technological processes in producing active pharmaceutical ingredients and finished products. We have been increasing production capacities and improving the cost-effectiveness of processes in Slovenia and at our subsidiaries abroad. By controlling all product life cycle stages, we are better equipped to respond to market challenges more readily and effectively.
We effectively integrate research and development with API and pharmaceutical production, enabling us to swiftly and smoothly transfer new products from development to regular production. In 2024, we accelerated technological problem-solving, optimised technological processes, and introduced many alternative sources of materials to ensure uninterrupted production and long-term volume growth.
We significantly cut the average lead time from order to delivery through continuous process enhancements. This, in turn, boosted our responsiveness and process flexibility across the entire supply chain. We continued to optimise inventories of raw materials and finished products.
By optimising available resources in the controlling company and subsidiaries and through cooperation with partners, we manufactured and packed 18.9 billion tablets and other pharmaceutical forms in 2024. By achieving 12% annual growth compared to 2023, we sustained our long-term trend and advanced toward our strategic objective of volume growth. Actual product manufacturing was in line with planned market needs.
Bulk and finished product numbers rose on the back of the increasing number of products and production sites; shifting market requirements; requirements for package labelling in national languages; and other demands. Careful planning and efficient production allowed us to meet diverse customer demands.
We continuously improved post-registration procedures for preparing packaging materials and technological documents for production in Slovenia, at our subsidiaries abroad and at manufacturing partners to ensure the timely provision of products and prompt response to sales demands.
| 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|
| 0 | 2 | 4 | 6 | 8 |
| 10 | 12 | 14 | 16 | 18 |
| 20 | Billion pieces |
We mainly use self-produced raw materials for our products but also buy some on the market. Despite the ongoing unstable situation, shortages of incoming materials, lower manufacturing output at our partners due to soaring energy prices, and transport issues, we provided enough raw materials for uninterrupted manufacturing of finished products. We enhanced the transparency of purchasing raw and packaging materials and upgraded our system for managing purchase agreements and coordinating raw material specifications with suppliers.
We effectively managed prices in the market for purchasing raw materials and continued to introduce alternative sources for active pharmaceutical ingredients, excipients, and packaging materials of equal quality at better prices. This helped mitigate risks posed by changing circumstances that affect supply.
We improved the integration of our subsidiaries and optimised purchasing processes while strengthening our established supplier partnerships. The situation in the Russian Federation and Ukraine did not significantly impact the Krka Group’s supply chains or the seamless supply to production units at Krka and its subsidiaries.
Purchase and transport agreements concluded with our suppliers and contractors require them to comply with national and international laws and regulations. In 2024, we worked with 161 ISO 45001-certified suppliers and 337 ISO 14001-certified suppliers and regularly audited them. We conduct approximately 150 audits a year.
A high level of vertical integration in the production process generates high-added value. Vertical integration means that we produce and technologically control a large proportion of the active ingredients that we incorporate into our products at various production sites in Slovenia and abroad. Doing so reduces our dependency on external suppliers in this key supply chain segment.
We improve the cost-effectiveness of producing key intermediates and raw materials by optimising processes at all production sites. We transferred additional technologies (products) to expand capacity at our Sinteza 1 plant in Krško, Slovenia. In turn, we significantly expanded active ingredient production capacity for our vertically integrated products and plan to expand capacities even further. The intensive production of active ingredients and intermediates continued at our production sites in Novo mesto and Krško, both in Slovenia. Our production plans for 2024 were executed.
We have been integrating additional high-capacity equipment and advanced high-tech solutions into pharmaceutical production. Upgrades and refurbishments have enhanced production process efficiency, augmented digitalisation, and enabled the use of production documentation in e-format, contributing to greater automation and paperless operation. Optimisation played a key role in improving production effectiveness and driving strong growth in product segments that experienced a considerable rise in market demand.
Production at our production sites abroad continued, further consolidating our position as a local manufacturer and allowing us to supply all necessary products to key markets to benefit local stakeholders. To respond faster to growing product demand, strengthen our presence in international markets, and reduce production process risks, we continued activities related to transfers of production technologies to our partners and expanded the manufacturing partner network. In 2024, we greatly intensified product technology transfers of bulk products in the manufacturing and packaging phases and increased production volumes. This helped ensure steady production growth and the long-term supply of our products to markets.
To ensure continuous training and uphold work quality standards, we upgraded the Pharmaceutical Production training centre, where our employees receive hands-on training on equipment used in all key production and technological processes. Participants learn through the experience and expertise of their mentors, selected from Krka’s top-performing employees, along with modern knowledge transfer methods.
We improved warehouse capacity utilisation through process optimisation, new computer system options, and inventory optimisation in conjunction with other organisational units. The new multipurpose warehouse served its purpose well. We increased the number of eco-friendly cargo vehicles for product distribution and reduced average fuel consumption. We efficiently deployed our first heavy-duty electric truck for product transportation and expanded our use of temperature-controlled sea transport. Due to the challenging operating climate in 2024, we explored new transport options and efficiently moved products by road as an alternative to established transport routes. We effectively coordinated all necessary transport resources to support growing sales volumes.
We are approved as an authorised economic operator (AEO) for customs clearance procedures. This allows for a faster flow of goods and facilitates simplified declaration authorisation procedures.
Our long-standing relations with business partners, including suppliers of equipment, raw and base materials, contractors, and partners, are forged through mutual respect, trust, honesty, integrity, and fairness. Employees must comply with the procedures defined in internal guidelines, international agreements, and local regulations at all stages of the purchasing process. Purchasing roles and responsibilities are clearly defined, covering everything from identifying user needs and preparing tenders to selecting suppliers, contracting and placing orders.
In line with our long-term objectives, sustainability goals, and main principles, we select potential suppliers by considering their:
We conduct supplier audits in accordance with quality standards and Krka guidelines and take account of suppliers’ quality, responsiveness, delivery terms, reliability, prices, regulatory compliance, compliance with our guidelines, and their social responsibility. In 2024, we further assessed and evaluated some of our key suppliers based on ESG criteria and initiated activities to establish an appropriate due diligence process, which we will upgrade in accordance with international guidelines and European legislation.
We pursue a policy and practice of engaging local suppliers and contractors, particularly when factors such as responsiveness, flexibility, and the frequent or ongoing involvement of suppliers and contractors in investment and service processes are important, in addition to competitive pricing. In 2024, spending on suppliers of goods and services in Slovenia accounted for 13% of the total Krka procurement budget.
In 2024, the Krka Group allocated €117.0 million to investments, €87.8 million of which to the controlling company, and €29.2 million to subsidiaries. We primarily invested in expanding and technologically redesigning our production and development facilities, improving quality assurance, and our production and distribution centres worldwide.
We prioritise sustainable development values, carefully evaluating environmental standards and both direct and indirect environmental impacts in all our investment projects. The selected equipment embodies the best available technology for environmental protection and energy efficiency, ensuring safe and efficient operations.
In Slovenia and internationally, we made multiple investments in new production equipment and upgrades to systems and instruments, further boosting our production capacities and product quality. In 2024, our investments were primarily focused on the production of finished products, information and documentation management systems, intangible assets, and infrastructure. The investments play a crucial role in aligning our research and development, production, and control processes, showcasing the advantages of our vertically integrated business model. Investments accounted for 6.1% of sales revenue generated in 2024.
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| 77 | 66 | 106 | 132 | 117 | 6.1 |
| 5.0 | 4.2 | 6.2 | 7.3 | 6.1 | 0 |
| 2 | 4 |
We upgraded the water supply systems and automated washing systems in the old section of Notol, our solid dosage forms production plant in Novo mesto, Slovenia, ensuring compliance with cGMP guidelines. We replaced 16 outdated packaging lines and installed a high-capacity double-sided tablet press, boosting tablet compression output and cutting large-batch production times for certain products. Additionally, we are investing in upgrading and expanding granulation capacities and modernising the logistics system. These investments guarantee that our Notol Department will operate reliably for the next twenty years and beyond.
We instigated the installation of an additional container tumbler at our Notol 2 Department in Novo mesto, Slovenia, to enhance production process reliability. We also plan to install a new high-capacity tablet press to boost production capacities further.
At the Solid Dosage Products plant in Novo mesto, Slovenia, the investment in additional capacities for tabletting mixture preparation, granulation, and logistic capacities is nearing completion. We replaced a capsule-filling machine, and the delivery of a filling-and-packaging line is in its final stages. Meanwhile, the upgrade of robotic cells on packaging lines is still in progress.
A new suspension inspection line is currently being installed at the Sterile Products Department in Novo mesto, Slovenia. This will increase quality control and output capacity significantly.
We have begun work on an extension to the Sterile Products Department in Novo mesto, Slovenia. The new production line for sterile solutions is expected to expand production capacities for animal health products and ensure the long-term production of high-volume sterile products.
Work is in progress at the Powders and Solutions at the Bršljin Department in Novo mesto, Slovenia to increase packaging capacities for tablets and spot-on products for veterinary use.
We increased production capacities for granulation and packaging at the Ljutomer plant in Slovenia. Work is currently underway to install personnel and material airlocks at the old section of the plant. Additionally, we installed an inspection machine to increase production capacity for uncoated lozenges and a robotic cell to optimise packaging.
| 41.8% | 7.9% | 8.8% | 14.6% | 26.9% |
|---|---|---|---|---|
| Finished product manufacturing | API production | Infrastructure facilities and systems | Tourism infrastructure | Documentation and information technology systems and equipment, intangible non-current assets and other fixed assets |
We obtained the integral building permit for our plant in Krško, Slovenia, comprising the Sinteza 2 API production plant, laboratories for chemical analyses (Kemijsko-analitski center), the liquid raw materials warehouse, and the waste water treatment plant, all based on project documentation and an environmental impact assessment. We are still in the process of obtaining the environmental protection and chemical safety (SEVESO) permit. At the end of 2023, we started constructing a technologically advanced waste water treatment plant. However, we intend to postpone the construction of other buildings for a few years.
We improved energy efficiency at our waste water treatment plant in Ločna, Novo mesto, Slovenia, by exploiting captured excess effluent temperature for heat generation. This investment supports our strategic goal of responsibly managing natural resources.
We finished replacing steam kettle burners at our central site in Ločna, Novo mesto, Slovenia, to meet the latest air emission regulations. Additionally, we continued replacing FLUO lighting with LED lights.
We expanded the capacity for pharmaceutical water production by improving drinking water treatment in our Vodarna 2 water plant, also in Novo mesto, Slovenia. This upgrade ensures redundancy and reliability across all stages of the treatment process and the production of pharmaceutical water from drinking water.
We started site preparation works for the construction of new buildings in the industrial zone of Cikava, Novo mesto, Slovenia. Archaeological and geomechanical surveys have been completed, while geophysical surveys are still in progress.
At the production and distribution centre in Jastrebarsko, Croatia, the installation of the secondary packaging line has increased production capacities for solid forms of products for veterinary use. Part of the investment in the building and system revamp was allocated to creating rooms for Quality Management and Information Technology. We also plan to upgrade tabletting equipment and refurbish the rooms.
At TAD Pharma, Germany, we plan to renovate the old wing of the office building to upgrade its energy efficiency and refurbish the conference hall and the reception area. We plan on building an extension to the commissioning warehouse within the next two years to ensure reliable packaging and order picking for the next ten years.
We plan to extend the Bršljin Department in Novomesto, Slovenia, to increase production capacities for veterinary products and their packaging. We started preparatory works while drawing up the project design.
We plan to construct a high-bay automated warehouse with 15,600 pallet places and handling areas at our plant in Ljutomer, Slovenia. The new warehouse will be four times the size of the existing facility, with handling areas spread across three floors. The design phase of the extension to the plant is set to start shortly.
We also started designing a new multi-purpose building on the newly acquired sites next to the Laguna building (Novo mesto, Slovenia). As per the building design, the business premises will house a contemporary IT data centre and offices for staff from Information Technology, Animal Health, and Sales.
All third-floor rooms, corridors, and balconies at the Hotel Svoboda in Strunjan were completely renovated. In addition, the restaurant and the hotel lobby were refurbished. The complete reconstruction and technological upgrades to the kitchen closely follow the latest trends in gastronomy. We also established a conference room, increased seating capacity, and installed video conferencing equipment.
On Trška gora, we renovated Krkin hram, specifically the roof and the façade on the main and auxiliary buildings, the guest room in the main building, and the kitchen with equipment. We also completed landscaping work.
We plan to reconstruct the Hotel Vital in Dolenjske Toplice, as well as renovate the Hotel Vitarium and the swimming pools in Šmarješke Toplice.
Our fundamental strategic orientation in terms of quality is to ensure the quality of our products, processes and services. To this end, we pursue effective quality system performance, which requires compliance with requirements of good practices in the pharmaceutical industry, standards for responsible management of safety, health and the environment, information security and personal data protection, data integrity, and business continuity. We maintain flexibility, react quickly to new developments, market needs and legal requirements, make investments, and rollout advanced work systems and suitable control methods to meet various client requirements. In addition, we demonstrate the continued suitability of products, processes, and services. We systematically address quality-related risks and opportunities to achieve sustainable development. Meticulous planning, employee quality culture and continuous development pave the way for further improvements.
Uniformly managing diverse requirements and standards is the key to manufacturing quality, safe, and effective products, achieving optimal business targets, and delivering services effectively. This approach reflects our commitment to quality, environment, safety and health, information security, personal data protection, and business continuity.
Regulatory inspections, partner audits and regular certification of our systems by SIQ (Slovenian Institute of Quality and Metrology) lend corporate credibility and reinforce and maintain customer trust. In 2024, we further upgraded the system to align with the relevant legislation and guidelines. The renewal and issuance of new certificates testify to the system’s compliance.
The quality system is supported by a centralised information and document management system, which we regularly upgrade through digitalisation and other measures to ensure that data in documents and electronic records are credible, easily accessible and protected and to provide transparency regarding our processes and products. We use this approach to conduct analyses and observe trends to ensure sound support for improving process and service efficiency, and product quality. Our data management system embodies ethical principles of personal integrity and staff accountability, ensuring diligent performance. It is built on framework quality guidelines, operating procedures, and controls that are seamlessly integrated into IT systems and organisational processes.
Ongoing improvements, guided by principles, standards, quality guidelines, and the PDCA (Plan-Do-Check-Act) approach, drive the advancement and enhancement of the company’s operations. We systematically manage processes from purchasing, research and development, production of active ingredients and finished products, distribution, marketing and sales to monitoring customer satisfaction by employing the vertical integration business model. Customer satisfaction and sustained business success remain our key objectives going forward. Quality is a cornerstone of all our processes, products, and services throughout their life cycles, and it is the core of every Krka employee’s work attitude. It is our key advantage in ensuring product quality, safety, and efficacy, serving as the foundation of our business success.
The baselines for establishing and developing the quality system are defined in Krka Group’s Quality Policy, our framework document on quality, and Krka Group’s guidelines and instructions in line with legislation, good practices and standards. We regularly monitor all related developments and systematically roll them out across our processes. We are committed to continuously upgrading the quality system to enhance process and service efficiency. We control processes that warrant operational performance, suitability of the quality management system, and product quality at all our production sites. The same principle applies to our collaboration with key strategic partners, reinforcing our commitment to delivering quality, safe, and effective products across all production sites.
Our established key processes, supported by appropriate resources, enable us to deliver on our quality objectives. Our greatest asset is our employees, who recognise the importance of quality. They undergo continuous training and constantly upgrade their qualifications in quality management, fostering a strong culture of quality across all processes. We collaborate with experts from various fields to identify improvement opportunities, develop innovative approaches, and implement new advancements.
Proper process implementation relies on physical resources, including buildings, equipment, and IT systems. Before commissioning a new or renovated facility with its integrated equipment and systems, Quality Management ensures compliance with all applicable good practice requirements. The vast number of projects demonstrates large-scale investment in new plants and departments, new or reconstructed rooms, new production, laboratory and development equipment, etc. Major projects in 2024 included completing the packaging room renovation and modernising granulation lines at the Notol plant, increasing production capacities at the Solid Dosage Products plant, refurbishing rooms to meet GMP requirements and increasing granulation and packaging capacities at the Ljutomer production site, and reconstructing the warehouse at the Bršljin site (all Slovenia). Construction of our new microbiological laboratory began in 2023 and was completed in May 2024, following verification by the Agency for Medicinal Products and Medical Devices of the Republic of Slovenia. We set up a new laboratory for monitoring impurities in active ingredients and finished products and introduced a novel elemental impurity testing method.
We maintain data integrity, especially regarding completeness, persistence, availability, legibility, accuracy, origin, contemporaneity, consistency, security and descriptiveness, and ensure regulatory compliance. Considerable attention is given to developing and implementing information systems and introducing and managing laboratory and production equipment. We maintain source data integrity through equipment validations and qualifications, change control, and deviation management.
Quality is integrated at the early stages of research and development to produce a quality, safe and effective product. We promptly incorporate legislative amendments in our work processes to follow good practices and standards from the product development phase onwards. When producing medicines for clinical research, we use new approaches and apply expertise to ensure the level of patient and volunteer safety required by law.
We set up a system for ensuring the quality of clinical research and the safety of patients and volunteers participating in research. We ensure quality through: highly qualified personnel, use of adequate equipment and computer systems, risk management, careful screening of partners involved in the entire product manufacturing process, clinical research performance monitoring, reporting on patient safety and safety of all other participants in clinical research, and the deviation investigation system.
The pharmacovigilance system ensures the safety of medicinal products for use in human and veterinary medicine by complying with the EU and third-country statutory requirements and quality system requirements. We carefully record and conduct medical reviews of all reported adverse events claimed to be associated with our medicines in every country where we hold marketing authorisations and where our investigational medicinal products are used. Any new findings relevant to the safe administration of our medicines are incorporated into product information leaflets or addressed through other risk mitigation measures. In addition, we present data and findings to regulatory authorities. We also have surveillance and vigilance systems in place to monitor medical devices after they are placed on the market. They help us systematically gather and analyse medical device quality, performance and safety data throughout their life cycles.
Our quality system for active ingredients and other incoming materials complies with legislative requirements and good practice standards. Adherence to internal regulations ensures that incoming materials comply with registration documents and quality standards. Our systematic approach to managing incoming material sources contributes to positive quality trends, resulting in a minimal number of complaints related to incoming material batches.
Our finished product and API production builds on in-house technology. We control the critical stages of the production process, and examine and assess documents for every product batch separately to confirm that our medicines are manufactured in compliance with the marketing authorisation requirements, prescribed procedures, and good manufacturing practice guidelines. Process, packaging, and cleaning validations ensure compliance with technological procedures applied in bulk product manufacturing, finished product packaging, and production equipment cleaning. We develop product control strategies incorporating quality attributes to guarantee adequate and reproducible product quality.
We closely follow and assess the quality attributes to identify any risks. Assessments of production processes and quality attributes are the basis for preparing annual Product Quality Reviews (PQR) and reports on continuous process verification. We prepare them in compliance with the latest standards and guidelines on pharmaceutical production using advanced statistical tools and report systems.
The safety of medicinal products is paramount, achieved through stringent quality control of active pharmaceutical ingredients and finished products. Regulatory bodies, particularly those in the EU, closely examine safety issues. They have recently been focusing on impurities with carcinogenic potential. They establish guidelines and progressively adopt measures for specific active pharmaceutical ingredients and products. We fully adhere to these guidelines and measures to ensure our products remain compliant.
We also adhere to national requirements to prevent falsified medicinal products from entering the legal supply chain. Our medicines have safety features placed on their packaging. They consist of a unique identifier (serialization), which prevents a falsified medicinal product from being dispensed, and an anti-tampering device, which helps to detect whether the product’s packaging has been tampered with. In addition to serialization, products intended for certain countries must be shipped in labelled transport boxes and pallets (aggregation) for improved medicinal product traceability and control from the producer to the user. In 2024, we introduced safety features on finished products to be sold in Kazakhstan, the Russian Federation (for animal health products), and Azerbaijan. In 2025, the full implementation of the single European safety feature system will take effect in Greece and Italy as the six-year transition period comes to an end. We will also start to assign identification codes to medical devices in line with the globally accepted identification and coding standard for medical devices. In 2024, there were no reports about falsification or safety feature non-compliance from the markets.
responsiveness inconducting analyses. In 2024, we rolled out the LIMS system to streamline and accelerate laboratory processes, save time, and reduce quality control costs. A strong quality culture remains the cornerstone of our work, driving success and achievement of our goals.
We carefully plan and coordinate activities crucial for the timely implementation of production and sales plans. We monitor response times in the release phase to ensure the timely release of materials and finished products. The person responsible for releasing medicinal products authorised by the competent medicines agency certifies each batch before its market release. We also continually monitor the stability of APIs and marketed products and guarantee their compliance with the specifications throughout their shelf lives.
We measure our work performance by regularly monitoring quality indicators. Feedback from our customers and users is a critical indicator. We track and thoroughly investigate their complaints, opinions and suggestions and respond to them as soon as possible. The ratio of batches with complaints lodged over the last five years to the total number of released finished product batches is marginal, showing no significant upward trend despite rising production volumes. There has been no upward trend in recalls over the past five years. In 2024, we made five recalls. Even where the impact of defects on product quality, safety, and efficacy was minimal, we implemented the recalls in line with our responsibility to deliver high-quality medicinal products to our users consistently. Recalls are made in collaboration with marketing authorisation holders (MAHs) and the competent authorities responsible for medicinal products in individual countries. We test the effectiveness of the recall procedure in mock recalls.
We constantly monitor the quality of our products on the market, collecting and evaluating data on a medicine’s safety throughout its life cycle, before and after obtaining marketing authorisation, and during its daily use. We continuously manage risks and provide the correct information to healthcare providers and users of our medicines.
Competent regulatory bodies and our partners supervise the quality system. We also conduct internal system audits, and our controllers supervise the system at production sites.
We manufacture and market products in various countries, meaning we are subject to inspections by different regulatory authorities and inspection bodies. In Slovenia, JAZMP supervises medicinal products and medical devices intended for the EU, whereas the Health Inspectorate of the Republic of Slovenia (ZIRS) monitors cosmetic products and foodstuffs, including food supplements. The Chemicals Office of the Republic of Slovenia controls biocidal products and compliance with good laboratory practice principles, while the Administration of the Republic of Slovenia for Food Safety, Veterinary Sector and Plant Protection (UVHVVR) controls feed additives and distribution of veterinary medicinal products. The Metrology Institute of the Republic of Slovenia (MIRS) conducts inspections of measuring devices in use and available on the market and prepacked products.
In 2024, we observed an increase in inspections and audits at the Krka Group level compared to previous years. JAZMP, which regularly inspects medicinal product and API manufacturing processes, medicinal product distribution, clinical trials, and pharmacovigilance, conducted a verification of the new microbiological laboratory and the new API manufacturing process. Additionally, it carried out regular inspections of solid and liquid dosage form production, quality control and analytical development laboratories, and the pharmacovigilance system for medicinal products for human use.
Regular inspections facilitate renewals of good manufacturing practice (GMP) and good distribution practice (GDP) certificates, ensuring that the manufacture and distribution of medicines and APIs comply with good practice principles and guidelines. Regular supervision by the Chemicals Office of the Republic of Slovenia confirms our compliance with good laboratory practice (GLP) principles.
Our medicines are also marketed in non-EU states where national requirements apply. Certain countries do not recognise European GMP certificates, meaning competent national regulatory bodies conduct national inspections. In 2024, we underwent GMP inspections by regulatory authorities in Libya and Azerbaijan. By passing EAEU inspections in 2024, we obtained renewed EAEU certificates for all our production sites in Slovenia that are involved in manufacturing medicinal products for human and veterinary uses. The certificates allow us to apply for marketing authorisations and market medicinal products in the EAEU member states.
Our experts participated in preparations for EU, EAEU, and Chinese inspections at our subsidiaries and main contractual partners. Oversight of operations and quality management in product manufacture and distribution, clinical research monitoring, and pharmacovigilance inspections play a crucial role in ensuring integrated quality management, product safety and efficacy, and risk management in all areas.
Our partners and certification bodies conduct audits in the Krka Group companies annually to verify compliance with good practices and standards, pharmacovigilance system suitability, and contract compliance.
Competent authorities for medicinal products also conduct quality control of marketed products. Every year, several products undergo their control procedures to verify product quality. In 2024, all control results were compliant, reaffirming the effectiveness of our internal quality control system.
Our information security management system (ISMS) is ISO/IEC 27001-certified and undergoes regular review through self-inspections, audits, and inspections. In 2024, we passed the initial audit to adhere to the latest version of the ISO/IEC 27001:2022 standard. We regularly assess risks related to information sources and employ state-of-the-art technologies to safeguard our systems from external attacks. Our subsidiaries adhere to the guidelines established by the controlling company in the Information Security Policy and Rules on Personal Data Protection, ensuring a uniform ISMS across all Krka Group companies.
To comply with the applicable legislation, we implemented personal data protection activities related to CRM databases, video surveillance and other areas. We revised the Rules on Personal Data Protection. We regularly monitor specific personal data processing procedures and align them with the latest practices of supervisory bodies in Slovenia, other EU member states, and non-EU states, for example, regular personal data updates in databases maintained by all Krka subsidiaries in the EU, processing geolocation data for specific employee groups, and using cookies on websites. We aim to minimise the risk of violations and ensure compliance with applicable legislation and practice.
Regular and ongoing employee training and awareness campaigns are essential for the successful implementation of the ISMS. In 2024, we focused on raising awareness among all Krka Group employees about phishing and smishing attacks through simulated attacks mimicking real-life situations. We ensure high uptime for critical systems, including the business, production, documentation, e-mail, and control systems. The expected minimum availability of critical (production, documentation, business, and e-mail) systems is 99.5%. Krka has duplicated its data centre and implemented various
| 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|
| 23 | 35 | 21 | 28 | 31 |
| Number of inspections |
The business continuity management system (BCMS) complies with the ISO 22301 standard. Its purpose is to prepare and implement measures and procedures for uninterrupted production and sales of our flagship products in the event of major incidents and disasters. The BCMS operates according to the adopted strategy and policy and is regularly updated. Key features of the BCMS include procedures for optimising our resilience to incidents, incident management procedures, and business continuity plans for crisis management. The BCMS is integral to the Krka Group’s comprehensive risk management. We regularly control it through internal audits and inspections.
In 2024, we evaluated the implementation of the BCMS strategy, focusing on the reliable supply of active ingredients, heating, cooling and power sources, and other key sources. We regularly arranged complex drills to verify the feasibility and efficiency of planned business continuity measures across all nine critical processes identified in the Business Impact Analysis. This initiative fostered awareness and strengthened the skills of employees responsible for managing emergencies, directing damage limitation activities, and swiftly restoring operations online. Following training analysis, we made the requisite improvements to business continuity plans or validated the adequacy of planned measures.
We are aware of the impact of our operations on society as we are an international pharmaceutical group and one of the largest companies in Slovenia. Our day-to-day business takes account of social responsibility principles and social needs, adhering to our strategic guidelines.
We foster open communication with local communities and run corporate campaigns that contribute to the progress of the community and create opportunities for us to cooperate and interact with all key stakeholders in our local setting. We make strategic plans and design and manage our business model by factoring in their views, interests, and rights, including their human rights.
Integrated social development, scientific research, intergenerational and interdisciplinary cooperation, adherence to diversity principles, and healthy lifestyles are what we continuously foster. We support health and quality-of-life projects and collaborate with partners that share similar sustainability values.
We maintain long-term partnerships across sports, culture, healthcare, science, education, and humanitarian initiatives. We prioritise long-term projects that allow us to forge close and efficient partnerships. We support the development of young talents and their involvement in sports and cultural activities, which foster healthy lifestyles and shape bright futures.
The Krka Group Development Strategy is the umbrella document regulating sponsorships and donations. We then carry out the initiatives in accordance with the Code for Allocating Sponsorships and Donations, our guidelines aimed at enhancing Krka’s positive social impact and contribution to the sustainable development of society as a whole.
We view sponsorships as partnerships that benefit the sponsor, the sponsored entity, and society, consolidating our reputation while donations facilitate the general progress of society. They primarily include donations to humanitarian campaigns and initiatives that support local institutions and individuals. We donated to support humanitarian initiatives, help address the aftermath of natural disasters, alleviate social distress, poor living conditions and health issues, and preserve natural, cultural, and technical heritage.
We identify the community’s needs through regular contacts, long-term partnerships, annual meetings with our partners. Our sponsorship and donation committee screens sponsorship and donation applications.
In 2024, we allocated 0.21% of our sales revenue to sponsorships and donations, helping more than 550 institutions, associations, and organisations achieve their goals. As many as 17 sports and cultural clubs and associations appeared under the Krka banner, and Krka supported another seven clubs and associations as their main sponsor.
At the 18th sponsorship recipients’ meeting, three outstanding young individuals received the Talent-of-the-Year Award, while 15 others were recognised for their achievements. Two young individuals received the Krka Supergirl Award and Superboy Award for the second consecutive year, recognising their exceptional talents, diverse achievements, and exemplary virtues. We also expressed our gratitude to seven representatives from various clubs, associations, and institutions for their invaluable contributions. Since the Talent-of-the-Year Award for sports and culture was introduced in 2017, 24 outstanding young individuals from various Krka associations, clubs, and institutions have been honoured. Additionally, we have presented 106 awards for remarkable achievements in sports and culture, along with 35 Krka recognitions.
We endorse projects that advance the work of various educational and scientific institutions and deepen the expertise of highly skilled professionals. They are designed to upgrade infrastructure, offer scholarships, facilitate above-standard educational activities, promote research work, and enable participation in national and international competitions.
We attract young research talent through Krka Prizes. Over the past 54 years, we have awarded 3195 Krka Prizes. The Krka Prizes Council has played a prominent role in popularising research work among students, pupils and mentors in educational institutions. In the call for secondary school research papers, pupils submitted 55 research papers, and we awarded them 26 Krka Prizes and 29 recognitions. In the call for graduate and post-graduate research papers, we received 118 research papers and awarded Krka Prizes to 39 young researchers. Five of them received Krka Grand Prizes for their exceptional research work. We also presented 36 special commendation awards and 50 recognitions. The research papers covering theoretical and experimental issues and employing a multidisciplinary approach have been constantly improving in terms of quality and variety. The growing number of applicants each year reflects the high regard for Krka Prizes among secondary schools and universities.
In 2024, we partnered with more than 70 primary and secondary schools, supported major projects at three primary schools and kindergartens, and donated to school funds for talented pupils. We also supported several end-of-year celebrations at primary and secondary schools. Additionally, we contributed to the Janez Drnovšek Scholarship Fund for the seventh consecutive year.
Krka is a long-time sponsor of the Slovene Science Foundation. In 2024, the Foundation organised the 30th Slovene Science Festival with international attendance. On its 30th anniversary, the Foundation honoured Krka with a gold award for its role as a co-founder and its significant contributions to the common good and to the reputation and development of the foundation in Slovenia.
Volunteering and charity have become inseparable parts of our organisational culture. In 2012, we consolidated all our charitable and volunteering initiatives under Krka’s Week of Charity and Volunteering. In 2024, the number of Krka employees who volunteered to participate in the campaign was close to 1,000. Among them, the number of young employees joining us in the events is increasing yearly. Events took place across Slovenia, with Krka employees in 21 other countries where Krka has its subsidiaries and representative offices.
almost 4.6 tonnes of pet food and helped at pet shelters and the Ljubljana ZOO. We hosted almost 22,800 visitors and Krka employees at Krka.
We encourage our employees to volunteer on non-profit institution sponsorship boards and provide supplies. We are proud that many of our employees dedicate their free time throughout the year, not just during the Week of Charity and Volunteering. Since 2012, we have honoured the exceptional volunteers who help people in need with their humanitarian activities and participate in social responsibility initiatives in their local environments with the Krka Volunteer of the Year award. We also expressed our gratitude to those Krka employees who donated blood.
In line with our mission, ‘Living a healthy life’, we allocate most of our sponsorships and donations to projects related to health and quality of life. This also agrees with the United Nations’ sustainable development goal Good health and well-being (SDG 3), to which we contribute the most by our core business. We also provide affordable treatment by donating to healthcare institutions while complying with applicable laws. Our donations for acquiring state-of-the-art medical devices contribute to enhancing the quality of healthcare services, diagnostics, and patient treatment.
We donated medical devices and equipment to the paediatric wards of all ten Slovenian general hospitals and paediatric clinics of both University Medical Centres, enhancing diagnostics and treatment for children. This initiative also marked Krka’s 70th anniversary. Our donations included:
We donated a state-of-the-art infant open warmer to the Paediatric Clinic at University Medical Centre Ljubljana intended for premature neonates who need special care from the birth room through intensive care until the time to go home. Twenty-eight modern paediatric beds with lockers were donated to the Paediatric Clinic at University Medical Centre Maribor.
We work with patient associations and societies. Societies organise workshops, seminars, and events to inform patients and their families about diseases, treatments, and new research. Patients can understand their illness better and can be actively involved in the therapy. In this way, we together add to the quality of treatment and safety of patients with chronic diseases.
Among others, we supported two projects: What Does Your Heart Beat for?, a campaign run by the Slovenian Hypertension Society and the Slovenian Society of Cardiology, and Neuropathic Pain, a project managed by the Slovenian Association for Pain Management.
We promote many sporting activities to foster healthy lifestyles. We focus on supporting local clubs and associations encouraging youth involvement in recreational or professional sports. We donate funds to purchase sports equipment for schools and other organisations that promote a healthy lifestyle. We further deliver on our mission by supporting sporting events and recreational sports for a broad range of people.
Our long-term partners in sports are:
Through our campaign Caring for Your Health–Together We Scale the Heights, we carried out maintenance work on 17 signposted Krka hiking trails and contributed to safety in the Slovenian mountains together with the Alpine Association of Slovenia.
As the exclusive sponsorship of the Ski Flying World Championship in Planica, we honoured a 39-year partnership. We also arranged a trip to Planica for 287 children and their mentors from eight primary special education schools to attend the ski jumping qualification event.
We also supported the Women FIS Ski Jumping World Cup in Ljubno in Slovenia, events organised by the Slovenian Tennis Association and the Slovenian Gymnastics Federation, and the biggest amateur cycling event in Slovenia, Franja Marathon BTC City, as well as the Tour of Slovenia.
Since its establishment in 2000, we have actively supported recreational and sporting activities through the Krka Retirees Society.
We strive to bring culture closer to our employees and the local and wider community. Additionally, we support various cultural projects both locally and internationally, such as music and other festivals, publications of books, monographs and picture books for children, art exhibitions and camps, musical and theatrical performances, as well as visual, theatrical, and literary projects in primary and secondary schools.
We have hosted cultural evenings since 2008 to show our appreciation for artistic work, offering people the opportunity to experience enriching and captivating cultural events. The tradition of cultural evenings began at the church housing the Galerija Božidar Jakac gallery in Kostanjevica na Krki, where we invited many distinguished Slovenian and international artists. Through these performances, we aimed to enrich the cultural atmosphere of the Dolenjska region. In 2023, we hosted three cultural evenings. In July, a concert featuring baroque music performed by the Wrocław Baroque Orchestra ensemble in Kostanjevica na Krki, and in December, piano concerts by Aleksander Gadijev and Urban Stanič. We celebrated Slovenian National Cultural Day with a concert by the Cantabile Symphony Orchestra. Comprising distinguished musicians and music professors, the orchestra was joined on the Krka Hall stage by soprano Mojca Bitenc, cellist Klara Avšič, and the exceptionally talented young violinist Patricija Avšič, whom Krka proudly supports on her musical journey.
Our longstanding partnership with Cankarjev dom led to the 2nd international ballet festival at the centre. Building on the success of the inaugural International Dance Festival Ballet Nights, the 2024 edition featured even more ambitious productions, with Krka as the general sponsor. From 16 to 19 June, the festival showcased outstanding ballet performances by international and Slovenian ballet companies, alongside a series of fringe events. The festival’s central theme, launched by The Slovenian National Theatre Opera and Ballet Ljubljana and Cankarjev dom, paid tribute to the work of Vaslav Nijinsky.
We supported the publication of five books and several cultural societies and institutions, among them the Galerija Božidar Jakac gallery in Kostanjevica na Krki, Pihalni orkester Krka brass band, the Anton Podbevšek Teatertheatre, Festival Ljubljana, the Slovenian Reading Badge Society, the Slavic Society of Dolenjska and Bela krajina, the 56th international PEN Writers’ Meeting organised by the Slovene PEN Centre, and the Cankar Award for best original literary work.
Krka’s Culture and Arts Society plays a prominent role in fostering culture. In 2024, the Society arranged the 45th Dolenjska Book Fair, 17 art exhibitions, seven Theatre Club meetings, various art workshops, and performances by Krka’s mixed choir and Krka Octet.
To commemorate Krka’s 70th anniversary, we published the monograph 70 Years. Living a Healthy Life, adding to our collection of publications. During the ceremonial presentation, we also unveiled a new book alongside Krka’s Girl with the Growing Book sculpture, which now stands on the platform in front of our most state-of-the-art pharmaceutical production facilities. The monograph serves as a testament of time, honouring the past while offering a profound insight into Krka’s present and vision for the future. The comprehensive book was crafted by essayists and storytellers from both within and outside Krka.
Every year, we support several non-profit, non-governmental, and non-political organisations, as well as their initiatives and self-help organisations. We collaborate with humanitarian organisations like the Red Cross and the Slovenian Karitas charity, directing our funds toward saving lives, alleviating social and psychosocial distress, and improving social conditions.
In response to the devastating floods in Bosnia and Herzegovina in October 2024, we provided immediate relief by donating EUR 100,000 through Slovenian Karitas. These funds were directed toward the rapid rebuilding of the affected areas and supporting those who lost their homes—and, in many cases, their loved ones. Krka has been present in Bosnia and Herzegovina for 60 years. Employees at the Krka representative office in Sarajevo contribute to strengthening the country's healthcare system while fostering social responsibility with our support.
Krka has been the main sponsor of the People in Need Fund of the Regional Branch of Red Cross in Novo mesto for several years. We collaborated with humanitarian organisations and made several substantial donations to help families and individuals in need. Our executive managers also made a contribution to the Regional Branch of the Red Cross in Novo mesto to help a young motherless family.
In collaboration with the local Association of Friends of Youth Mojca in Novo mesto, we gave presents to more than 2,500 children from three municipalities in the Dolenjska region, as well as to children of Krka employees.
We continued our partnership with the Chain of Good People project, launched by the “Anita Ogulin and ZPM” Association, which supports families in need across Slovenia. We have worked with the Novo mesto Occupational Activity Centre for several years, where residents once again prepared New Year gifts for our company.
We provided both material and financial support to firefighting departments, contributing to the purchase of new fire engines and equipment and the renovation of fire stations of 15 fire brigades and fire departments across Slovenia. We also helped 88 fire brigades to raise funds by preparing promotional material.
If you need further information on social responsibility projects, please e-mail us at [email protected] or contact us by regular post at Krka, tovarna zdravil, d. d., Novo mesto, Public Relations, Šmarješka cesta 6, 8501 Novo mesto, Slovenia.
The sustainability statement is prepared in accordance with Directive (EU) 2022/2464 as regards corporate sustainability reporting; the European Sustainability Reporting Standards (ESRS); the European Financial Reporting Advisory Group (EFRAG); Regulation (EU) 2020/852 on the establishment of a framework to facilitate sustainable investment (Taxonomy Regulation) and the related delegated acts; and the provisions of the Companies Act (ZGD-1).
The sustainability statement includes disclosures on sustainability topics that we have defined and assessed as material from the perspective of double materiality (in the process of defining the IRO assessment or the double materiality assessment), meaning the materiality of impacts (on the natural or social environment) and/or financial materiality (the financial effects of risks and opportunities on the Krka Group). The process of defining the double materiality assessment and material sustainability topics is described in more detail within the Disclosure Requirement ESRS2 IRO-1 – Description of the processes to identify and assess material climate-related impacts, risks and opportunities. Incorporation by reference is used when disclosures in other parts of the annual report meet the requirements for reporting on a specific reporting requirement or data point or complement and explain it if it is essential for better understanding. An overview of disclosures under ESRS is presented in the context of Disclosure Requirement IRO-2 – Disclosure requirements in ESRS covered by the undertaking’s sustainability statement. Some disclosures, although not material to the Krka Group in terms of double materiality are nonetheless presented under sustainability topics or data points under the relevant topical standards. We include these disclosures to provide additional context and ensure a more comprehensive understanding of the standard. These details are classified as other information and have not been subject to an auditor sustainability assurances.
We apply the same level of consolidation as in the financial statements. The sustainability statement is prepared at the consolidated level for the entire Krka Group, covering all its operations. Within the sustainability statement, the name Krka refers to the Krka Group. The term Krka Group is also used in some instances. If the information pertains to the controlling company, the terms controlling company, Company or Krka are used. The sustainability statement is written in the first-person plural and refers to the Krka Group unless stated otherwise.
It includes information about the Group’s activities and business performance. The calculation of Scope 3 greenhouse gas (GHG) emissions also incorporates data from both the upstream and downstream value chain. The results of Scope 3 GHG emission calculation are presented in topical standard E1 under Disclosure Requirement E1-6 – Gross Scopes 1, 2, 3 and Total GHG emissions. The value chain was taken into account when defining the double materiality assessment. We utilised internal information and data obtained through regular engagement and collaboration with stakeholders across the value chain and in business relationships. Internal experts and sustainability officers from various professional and business fields participated in gathering information. These individuals maintain regular contact with different value chain segments and representatives. Material impacts, risks and opportunities are presented under Disclosure Requirement ESRS 2 SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and business model. Krka’s stakeholder groups and forms of their engagement are presented under Disclosure Requirement ESRS 2 SBM-2 – Interests and views of stakeholders.
We have not exercised the option to omit a specific piece of information corresponding to intellectual property, know-how or the results of innovation (as specified in Item 5(d) of ESRS 2). Likewise, we have not exercised the right to exemption from disclosure of impending developments or matters in the course of negotiation, as provided for in Articles 19a(3) and 29a(3) of Directive 2013/34/EU (Item 5(e) of ESRS 2).
Our reporting adheres to the medium- or long-term time intervals defined in ESRS 1, section 6.4 – Definition of short-, medium- and long-term for reporting purposes.
Regarding Disclosure Requirement E1-6 – Gross Scopes 1, 2, 3 and Total GHG emissions, our calculations of Scope 3 GHG emissions generated within the Krka Group’s value chain are based on the standards and recommendations of ISO 14064-1:2018 Greenhouse gases - Part 1 Specification with guidance at the organization level for quantification and reporting of greenhouse gas emissions and removals. The calculation has not been verified by an independent external body.
to facilitate measurement and comparison. This index is based on carbon dioxide (CO2), the most well-known greenhouse gas. It measures the warming potential of other greenhouse gases relative to CO2 over a specified time interval, typically 100 years, by considering their radiative efficiency. Various GHG emission factors were used in the calculations. A GHG emission factor is a coefficient that links activity data to corresponding GHG emissions. It is expressed in kilograms or tonnes of CO2 equivalent (tCO2 eq). It represents the amount of GHG generated through the production and/or use of a product or service.
Due to cost constraints, direct measurements of GHG emissions were not feasible. Instead, emissions were estimated by multiplying activity data (quantitative measures of activities that result in GHG emissions, such as mass, volume, and energy consumption) by published emission factors, typically expressed as tCO2 eq per unit of activity data. A 100-year time interval was applied to the GWP calculations. The calculations were based on emission factors from various sources, primarily the emission factor tables published by the UK Department for Environment, Food and Rural Affairs, DEFRA, and the Ecoinvent database. All relevant GHG emission sources within the defined reporting boundaries were identified, documented, and included in the calculations. The GHG emission data were obtained through modelling using Krka’s primary data (such as energy and material consumption, the amount of generated waste, the number of kilometres travelled, etc.) along with various emission factors from databases, primary data from individual suppliers, data from studies and scientific articles, and Bank of Slovenia foreign exchange rates.
Assumptions were applied for certain GHG emission categories, as detailed in the topical standard ESRS E1 under Disclosure Requirement E1-6 – Gross Scopes 1, 2, 3 and Total GHG emissions. We assess that the established data collection and GHG calculation system does not constitute a material risk to the accuracy of the final results. Going forward, we will strive to increase the use of primary data in cases where previous estimates relied on assumptions, studies, or scientific literature. We will acquire and use primary data predominantly from manufacturers of raw materials, including active ingredients, excipients, bulk products, products and packaging materials, and collect data from airlines on the actual carbon footprint of flights and other similar sources. There is a certain degree of uncertainty associated with emission factors. The main sources of uncertainty stem from the data provided by raw material manufacturers, particularly for active ingredients, bulk products, and products. Any changes in emission factors within these categories could significantly impact the final GHG calculation.
In addition to the information required by ESRS, our sustainability statement also includes disclosures mandated by the Taxonomy Regulation (Regulation (EU) 2020/852) and the related delegated acts, as well as information from Appendix B of ESRS 2, which is presented under ESRS 2 IRO-2 – Disclosure requirements in ESRS covered by the undertaking’s sustainability statement. These disclosures are compiled in the table List of data points in cross-cutting and topical standards that derive from other EU legislation.
| ESRS Requirement | Requirement title | Section | Subsection | Page |
|---|---|---|---|---|
| ESRS 2 GOV-1 | The role of the administrative, management and supervisory bodies | Corporate governance statement | Supervisory Board (Note to requirement 21. b.) | 21 |
| Management Board (Note to requirement 21. b.) | 26 | |||
| 2024 diversity policy for Management and Supervisory Boards (Note to requirement 21. d) | 30 | |||
| Composition of Supervisory Board of Krka as at 31 December 2021 (Note to requirements 21. c and 21. e) | 34 | |||
| Composition of Management Board of Krka as at 31 December 2021 (Note to requirement 21. c) | 36 | |||
| GOV–5 | Risk management and internal controls over sustainability reporting | Corporate governance statement | Internal controls and risk management relating to sustainability, financial and tax reporting | 32 |
| SBM-1 | Strategy, business model and value |
At a glance
Krka Group business model
Information about the composition and diversity of the management and supervisory bodies is presented in the ‘Corporate governance statement’ section, subsections ‘Supervisory Board’, ‘Management Board’, ‘2024 Diversity Policy related to representation in Management and Supervisory Boards’, ‘Composition of the Supervisory and Management Boards’. Detailed information about the role of the Annual General Meeting, Supervisory Board and Management Board is disclosed in the ‘Corporate governance statement’ section, subsections ‘Annual General Meeting’, ‘Supervisory Board’, and ‘Management Board’. These subsections include information on the number of members, their experience related to the company’s sectors, products and geographic locations, the percentage of independent board members, and data on the representation of employees and other workers. Information on the diversity of management personnel in the controlling company, its subsidiaries and representative offices is disclosed in the ‘Corporate governance statement’ section, subsection ‘2024 Diversity Policy related to representation in Management and Supervisory Boards’.
In 2024, Krka followed the recommendations of the European Voice of Board Members (ecoDa), a non-profit organisation representing national associations of supervisory boards, concerning the gender balance in the management and supervisory boards, adhering to the 40/33/2026 model, which mandates that members of the underrepresented sex hold at least 40% of positions in supervisory boards and 33% of positions in the management and supervisory boards combined. Krka met both targets in 2024. Based on best practices, the described model has been regulated by the Companies Act (ZGD-1) since 22 November 2024.
necessary, the board adopts a decision regarding revisions to the policy.
On 30 September 2024, Krka’s Management Board adopted the Diversity, Equity and Inclusion Policy of the Krka Group, reflecting Krka’s commitment to diversity, equity, and inclusion. This policy applies to Krka and its subsidiaries. It applies to all Krka Group employees and serves as the basis for further reinforcing our expectations of business partners in the value chain. The policy is detailed in topical standard ESRS S1 under Disclosure Requirement S1-1– Policies related to own workforce.
David Bratož, a member of the Management Board, is responsible for sustainability, including overseeing impacts, risks and opportunities. Other Management Board members are also responsible for monitoring impacts, risks and opportunities related to specific ESRS topical standards within their respective business areas.
Sustainability management is defined in the Krka Group ESG Policy. The policy defines Krka’s current and future commitments to sustainable management in environmental, social, and governance (ESG) areas, which Krka has been committed to for decades. Integrated, strategic, and efficient ESG governance is essential for managing environmental aspects and sustainability-related risks, identifying impacts, and detecting trends and opportunities for responsible management of natural and social environments.
To ensure long-term business success, we integrate sustainability principles into our management processes and decision-making.
The policy defines (1) key stakeholder groups and their forms of engagement, (2) our contribution to achieving the global sustainable development goals (SDG) from the 2030 Agenda, (3) sustainability within the Krka Group, (4) material sustainability topics from the perspective of double materiality, (5) the purpose, goals, and scope of the policy, (6) the Krka Group’s sustainability commitments, (7) sustainability management within the Krka Group.
The policy relates to material impacts, risks and opportunities derived from the ESRS standards, which are associated with the natural and social environments and corporate governance. The policy is our framework document on sustainability and serves as the foundation for other related sector-specific policies.
Krka’s Supervisory and Management Boards play a leading role in overseeing sustainability management and the sustainability policy within the Krka Group. The sustainability policy is binding for the controlling company Krka, d. d., Novo mesto, and all subsidiaries in the Krka Group. It is a commitment to implementing sustainability principles and promoting their application in business operations across the entire value chain.
Krka’s Supervisory Board approves the Krka Group Development Strategy, which includes sustainable development, the Risk Register, the Integrity Plan, the ESG Policy, and any potential amendments.
Krka’s Management Board is responsible for integrating the sustainability strategy and establishing a culture of sustainability, values, and operational processes. It approves all key and relevant decisions related to sustainability (defining stakeholders and topics, as well as material impacts, risks and opportunities), as well as related sector-specific policies (Environmental Policy of the Krka Group – defined in section E1-2, Human Rights Policy of the Krka Group – defined in section S1-1, Diversity, Equity and Inclusion Policy in the Krka Group – defined in section S1-1, Code of Conduct for Business Partners of the Krka Group – defined in section G1-1, Due Diligence Policy in the Krka Group – defined in section S2-1), which also determine responsibilities regarding the oversight of task implementation. At the operational-strategic level, decisions made by the Sustainability Committee also define these responsibilities.
The board member responsible for sustainability leads and oversees the work of sustainability officers and chairs the Sustainability Committee. Krka’s Sustainability Committee reviews the implementation of ESG policies, strategies, and key activities to achieve sustainability goals. It discusses proposals for changes and upgrades to policies, proposals for strategic sustainability goals, amendments to strategic sustainability areas, and the identification and management of material impacts, risks and opportunities. The committee also addresses stakeholder sustainability-related initiatives and plans key activities in this area.
The sustainability coordinator is a member of the Sustainability Committee and acts as a liaison between the committee, the Management Board member responsible for sustainability, and the sustainability officers. The coordinator is responsible for operational oversight, ensuring and promoting sustainability policy implementation and other decisions of the Sustainability Committee. The coordinator collaborates on stakeholder engagement and communication on sustainability with investors, media, expert community, and other relevant stakeholders.
Sustainability officers are responsible for promoting strategic sustainability activities and a sustainability culture. They report to the Sustainability Committee and coordinator on the implementation of activities and progress toward goals within their business areas. This also includes participating in stakeholder engagement and assessing impacts, risks and opportunities. They contribute to sustainability reporting and propose improvements in sustainability management.
Other committees that support Krka’s Management Board in its work are responsible for preparing business policies and strategic guidelines for their respective areas and hold certain decision-making powers relating to the implementation of annual plans. These committees oversee the management of impact, risks and opportunities within their respective business areas and ensure compliance with specific ESRS topical standards relevant to those areas.
The Supervisory Board, Management Board, Sustainability Committee and sustainability officers all operate within the Krka Group. The sustainability coordinator, directors and heads of individual organisational units related to specific sustainability topics are responsible for reporting to the company’s administrative, management and supervisory bodies. They prepare information and materials for management board meetings, supervisory board sessions, and other committees. The departments responsible for specific topical areas prepare disclosures in the sustainability statement, with the Finance department and Corporate Performance Management department leading the preparation process.
The heads of individual organisational units are accountable for managing impacts, risks and opportunities as part of their responsibilities, tasks and activities. Dedicated controls and procedures are in place, with a particular focus on S4 – Consumers and end-users (management of impacts, risks and opportunities related to ensuring quality, safe and effective products), topical standards E1 to E5 – Environmental protection, and S1 – Own workforce.
Strategic ESG objectives are incorporated in the 2024–2028 Krka Group Development Strategy. Individual organisational units develop proposals for sustainability goals within individual focus areas. These proposals are reviewed by the Sustainability Committee, approved by the Management and Supervisory Boards, both of which, along with the Sustainability Committee, are regularly informed about goal achievements.
The expertise of Supervisory and Management Board members in sustainability and material impacts, risks and opportunities is disclosed in the ‘Corporate governance statement’ section, subsection ‘Composition of the Supervisory and Management Boards’. This subsection outlines competencies for sustainable business operations, including business conduct, and competencies related to specific ESRS topical standards. These competency areas are defined based on the skills, expertise and experience of board members in relation to material impacts, risks and opportunities specific to individual ESRS topical standards.
Krka’s Management and Supervisory Boards receive regular updates about the sustainability of company operations. From July 2023 to the end of 2024, the Supervisory Board addressed sustainability-related progress and advancements as a standalone agenda item at each meeting, totaling six sessions per year. During these meetings, it reviewed a written report from the Management Board on sustainability activities, and supporting documentation, including the double materiality assessment and an assessment of impacts, risks and opportunities relevant to the Krka Group’s sustainability performance. The Management Board examined these materials at least as frequently. This responsibility is part of the special additional duties of the Supervisory Board, as defined in Resolution 4.4 adopted at the 29th Annual General Meeting (AGM). Since the adoption of the Amendment to the Companies Act (ZGD-1), the Audit Committee of Krka’s Supervisory Board has also been regularly addressing sustainability matters.
The remit and decision-making processes of Krka’s Supervisory Board involve overseeing Krka’s objectives and those of the Krka Group in line with its development strategy and plans, legislation, best national and international practices, and by-laws. In its meetings in 2024, the Supervisory Board discussed Krka’s past and current operations, financial and business risks, situation on sales and purchase markets, human resource issues, investments and products, and monitored strategy implementation. It supervised the upgrades to Krka Group’s sustainable business practices and the reporting on progress in this area. Together with Krka’s Management Board, it reviewed the updated Risk Register, which also includes sustainability risks. It is designed to promptly identify and manage risk factors that may hinder business performance. The Risk Register complies with the revised the 2024–2028 Krka Group Development Strategy while considering changes in the business environment as well as other sustainability risks and emerging sustainability risks. In addition, the Supervisory Board deliberated on the Integrity Plan, which places emphasis on managing risks related to ethics, integrity, and business compliance, and was informed about the newly adopted set of corporate sustainability policies.
Each year, the Management Board reviews the achievement of Krka Group’s strategic criteria, approves key environmental objectives and programmes, and determines human, organisational and financial resources required for their implementation. The achievement of operational-strategic criteria at the sales market level is monitored by the supervisory or management boards of Krka’s subsidiaries. Various internal committees oversee the implementation of operational-strategic criteria in specific areas of operation. These committees consist of relevant Management Board members, division directors, and heads of departments (Directors’ Committee, Sales Committee, Development Committee, Quality Committee, Investment Committee, Human Resource Committee, Information Technology Committee, Economics and Finance Committee, Corporate Identity Committee, and Sustainability Committee). When making decisions on major transactions and important activities related to material impacts, risks and opportunities, potential negative impacts and risks are carefully assessed, particularly those regarding product quality, safety, and efficacy, environmental protection, and occupational health and safety.
In 2024, Krka’s Management Board, Supervisory Board and individual committees reviewed material impacts, risks and opportunities related to environmental matters, workforce, and product quality, as well as risks identified in the Risk Register and Integrity Plan. They were also informed about the achievement of strategic sustainability goals in 2023.
Management Board remuneration based on sustainability performance. Since 2023, the remuneration of the Management Board has been directly linked to the achievement of sustainability performance criteria, as stipulated in the Remuneration Policy for Management and Supervisory Bodies, which was prepared at Krka in accordance with the Companies Act (ZGD-1) and adopted by the 29th AGM on 6 July 2024. Performance and the achievement of objectives are assessed across six areas identified as key strategic sustainability topics for the Krka Group:
Each strategic sustainability area is assigned an equal number of points. Sustainability-related criteria carry the same weight as most financial performance criteria. The remuneration policy is based on Krka’s long-term development strategy and its sustainability policy. It encourages the Management Board to achieve the company’s strategic objectives and is focused on its long-term development and sustainable operations. Krka Group sustainability performance accounts for 35% of the variable remuneration of Management Board members, with planet- and climate-related criteria, including compliance with the action plan for reducing Scope 1 and Scope 2 GHG emissions, accounting for 6%. The Supervisory Board evaluates the Management Board’s sustainability performance twice a year, based on a written report submitted by the Management Board and the opinion of the relevant committee: covering the first half of the current year and the full previous year. The remuneration of Supervisory Board members and other management bodies does not include incentives related to sustainability strategic areas.
We encourage respect for human rights and environmental protection along the entire value chain. We encourage our business partners to adhere to internationally recognised standards, our commitments, and principles. Our values, efforts, and due diligence regarding human rights and environmental protection in business relationships with partners are outlined in the Code of Conduct for Business Partners of the Krka Group. In line with the Due Diligence Policy in the Krka Group, we will establish a due diligence process and related activities across our value chain in the future with subsequent enhancements planned. This will ensure compliance with the CS3D Directive by 2027. The Code is described under G1, Disclosure Requirement G1-1 – Business conduct policies and corporate culture. The due diligence policy is described under topical standard S2, Disclosure Requirement S2-1 – Policies related to value chain workers. Within the Krka Group, due diligence is integrated into the Integrity Plan, which is further reported in topical standard G1 under Disclosure Requirement G1-1 – Business conduct policies and corporate culture. When reviewing or assessing suppliers and customers, particularly for GxP compliance, the Quality Management department conducts specific audits. Additional details on quality management and the supply chain can be found in the ‘Quality’ and ‘Production and supply chain’ sections.
Paragraphs in the sustainability statement
(b) Engaging with affected stakeholders in all key phases of due diligence
(c) Identifying and assessing of adverse impacts
(d) Taking actions to address these adverse impacts
(e) Tracking the effectiveness of these efforts and communication
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Internal controls related to sustainability reporting are further defined in ‘Internal controls and risk management relating to financial and tax reporting’ (Corporate governance statement).
The preparation of the sustainability statement is the responsibility of experts specialising in relevant fields. We have prioritised the risks associated with the availability, collection, integrity, and consolidation of quantitative data, its processing, the accuracy of results, and compliance with ESRS disclosure requirements, as these were identified as the most material. As a result, the results were reviewed by employees at various levels, from subject matter experts to the sustainability coordinator and member of the Management Board responsible for sustainability. In 2024, the risk assessment of non-compliance with sustainability reporting was included in the Risk Register for the first time. In the future, we will enhance our internal control system, focusing on improving the information framework for collecting and processing quantitative data.
Krka’s mission, vision and values form the foundation of our governance processes and business decisions, enabling us to pursue our business strategy, achieve long-term strategic goals, and create value for stakeholders. We direct our long-term growth and development towards increasing positive sustainability impacts, reducing burdens on the natural and social environment, and effectively managing sustainability risks and opportunities. Our past and future business success is directly dependent on the effective engagement of stakeholders and the management of material sustainability matters throughout the entire value chain. Comprehensive, strategic, and effective sustainability management within the Krka Group is essential for managing material sustainability matters. It guides the strategic assessment of the appropriateness of the Krka Group’s business model, ensuring long-term sustainable business operations, growth and development.
In 2023, we took a significant step forward in integrating a sustainability perspective into our strategic planning and business operations as part of the 2024–2028 Krka Group Development Strategy revision. Sustainable business operations and sustainability strategy, goals, and planned activities to enhance sustainability management and operations have been fully integrated into the business strategy for the first time. The Krka Group’s commitment to sustainable operations is clearly defined and holds equal importance to our business strategy and other operational areas. This highlights the critical role of sustainability in our business operations.
human rights and freedoms, safeguarding labour rights, preventing discrimination, and promoting diversity and equal rights. As one of the leading generic pharmaceutical companies, we recognise our responsibility and significant social impact in providing accessible, effective, high-quality and safe medicines to over 100 million people every day across more than 70 markets.
Enhancing sustainability management, fostering a sustainability-oriented corporate culture within the Krka Group, integrating sustainability principles into corporate governance and business decisions, and maintaining economic, social, and environmental responsibility in the regions where we operate are among our key strategic objectives through to 2028. We have defined our key strategic sustainability management objectives in our sustainability policy, while further steps towards strengthening sustainability management and strategic commitments have been outlined in newly adopted sector-specific policies and other documents, which we will continue to update as needed in the future.
In recent years, we have established a solid foundation and a systematic framework for sustainability management within the Krka Group. In 2025, as part of the renewal of the 2024–2028 Krka Group Development Strategy, we will further enhance various aspects of sustainable business operations, along with related policies and processes. We will place even greater emphasis on the strategic management of material impacts, risks and opportunities. We will introduce new activities and refine our strategic sustainability goals and the metrics for monitoring their implementation. One of our key objectives is to manage material impacts, risks and opportunities even more effectively.
In 2024, the Krka Group generated 97.4% of its total revenue from sales of pharmaceutical products (NACE C.21.20), of which 91.5% came from medicinal products for human use and 5.9% from animal health products. Among the medicinal products for human use, prescription pharmaceuticals accounted for 82.5% of total sales, while non-prescription products contributed 9.0%. The remaining 2.6% of revenue was generated from the sale of health resort and tourist services through the subsidiary Terme Krka, d. o. o. (NACE I.55.10). Given the nature of its activities, this segment is not associated with the Krka Group’s material impacts, risks and opportunities. During the reporting period, there were no significant changes in our product or service offerings.
More detailed information on our key product and service groups as well as our major markets can be found in the ‘Marketing and sales’ and ‘Product and service groups’ sections, and in the ‘Financial report’ under the ‘Notes to the consolidated financial statements’ (‘4. Revenue from contracts with customers’).
| € thousand | 2024 | Share |
|---|---|---|
| Slovenia* | 121,004 | 6.4% |
| Region South-East Europe | 269,025 | 14.2% |
| Region East Europe | 650,339 | 34.2% |
| Region Central Europe | 426,530 | 22.4% |
| Region West Europe | 351,803 | 18.5% |
| Region Overseas Markets | 81,147 | 4.3% |
| Total | 1,899,848 | 100.0% |
Disclosures on the number of employees are presented in the ‘Financial report’ under ‘Notes to consolidated financial statements’ (‘31. Profile in the Krka Group’).
The strategic sustainability objectives related to product and service group, customer categories, geographical areas, and stakeholder relations focus on product quality and patient safety, tailored range of products, professional support for healthcare professionals, initiatives to raise awareness of healthy lifestyles and common diseases, ensuring the continuous availability of medicines, and responsible product sales and marketing. These objectives are specifically defined in topical standard ESRS S4 under Disclosure Requirement S4-5 – Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities.
As a manufacturer of generic medicines, the Krka Group ensures accessible healthcare with its products in the markets it serves, thereby achieving its most material social impact. The related sustainability objectives from topical standard ESRS S4 focus on ensuring accessible healthcare, quality products, and patient safety. These objectives are directly linked to our corporate social responsibility, reflected in our commitment to the uninterrupted supply of affordable, quality, safe, and effective medicines. Through our broad range of products across various therapeutic areas – particularly in treating chronic diseases – we achieve a material and direct positive social impact. Our extensive range of products includes medicines for the treatment of chronic diseases, marketed and sold in all key markets, ensuring that we meet our sustainability objectives. We allocate approximately 10% of our annual revenue to research and development, allowing us to continuously expand our portfolio with modern and innovative products, thereby improving access to healthcare.
The Krka Group’s business model, including our value chain, is illustrated in the ‘Introduction’, in section ‘At a glance’, presenting key elements of both the upstream and downstream value chain, and our internal operations. Krka uses a vertically integrated business model, which allows us to systematically manage processes from procurement, research and development, manufacture of active ingredients and finished products, distribution, sales and marketing, to monitoring customer satisfaction. Through vertical integration, we enhance the resilience and flexibility of our business operations.
In preparing the business model framework, we incorporated insights from Krka’s experts who participated in the double materiality assessment across various business areas. Based on established materiality criteria, we identified key stakeholders and the most critical partner groups within the upstream and downstream value chain, their regions of origin, and the types of services or incoming resources they provide. Data collection on the upstream and downstream value chain relied on internal information and insights from experts across business areas, gathered through ongoing business relationships and dialogue with value chain representatives. However, we have not yet directly engaged tier N direct and indirect representatives of the upstream and downstream value chain in the process or collected data from them. We plan to improve this approach and incorporate more direct engagement in the future.
Krka’s vertically integrated business model strengthens the resilience, flexibility, and responsiveness of our operations, thanks to the seamless integration of the upstream and downstream value chain underpinned by long-term partnerships with key stakeholders. This model enables us to efficiently manage various impacts, risks and opportunities, including sustainability-related ones. It allows us to expand our positive social impact, preserve and protect the natural environment, and seize opportunities while maintaining oversight and taking corrective action if needed to mitigate or eliminate negative environmental and social impacts. Through our core activity – manufacture and supply of pharmaceutical products – we work for the well-being of patients and other users of our medicinal products. The effective management of sustainability impacts, risks and opportunities contributes to Krka Group’s long-term stable growth and development, which is reflected in consistently stable business results. This is particularly important for our shareholders, employees, business partners, and the broader community.
We maintain an ongoing dialogue with representatives of various key stakeholder groups through various communication channels, media and engagement formats. Stakeholder engagement aims to obtain direct information about their expectations, understand Krka’s operations and its impact on individual stakeholder groups, and identify material risks and opportunities. Important information obtained through daily business interactions with stakeholder groups is the key input in the company’s strategic planning, management, and business activities. By understanding the expectations of and impacts on individual stakeholder groups, we can effectively manage our positive social impact, expand its reach and scope, and proactively prevent or mitigate negative impacts to the greatest reasonable and feasible extent while addressing any potential consequences.
Investors and financial analysts, who are increasingly focused on the ESG domain, partly due to regulations (e.g. SFDR Regulation, Taxonomy Regulation), are among Krka’s key stakeholder groups. Every year, we organise over 100 investor meetings. The main topics of discussion always include the key sustainability matters, so we are well aware of their expectations.
Krka operates in the highly regulated pharmaceutical production and distribution sector. As a result, legislation and regulations have a significant impact on our development, regulatory, manufacturing, marketing, sales, and other activities. Within our quality management system, GxP standards, and numerous ISO standards, we continuously monitor and manage our impacts and risks, which are also subject to numerous regulatory inspections.
In 2024, we broadened our key stakeholder groups to include silent stakeholders: workers in the value chain (tier N+1), customers, suppliers, and the environment. Users of the sustainability statement are recognised and considered within the other key stakeholder groups to which they belong.
| Key Stakeholder Groups | Engagement Modality |
|---|---|
| Patients | Responsible, professional communication about products through various media, including social networks and digital channels |
| Health professionals, healthcare providers and direct customers | Long-term partnerships Annual online survey on satisfaction with core aspects of business operations (general satisfaction, satisfaction with products, sales personnel, order processing and fulfilment, and complaint procedures) Suggestions for improvement Regular information on products provided in print and electronic forms Direct contacts through medical representatives in 40 countries Organisation and support for professional and educational meetings Advanced digital content for the professional community Feedback and opinion obtained through daily contact and market research |
| Employees, prospective employees, and trade union organisations | International conferences for employees (on various topics) Measuring organisational climate Works Council Worker assemblies |
| Regulatory agencies/bodies and government organisations | Long-term cooperation and provision of reliable documents |
| Educational and scientific research institutions | Cooperation with secondary schools, universities and scientific institutes Cooperation under the Krka Prizes Fund for young researchers |
| Shareholders, financial institutions and other capital market stakeholders | Meetings with investors at the Krka headquarters Meetings between financial analysts and Krka management Participation in investor conferences |
The Krka Group operates in the highly regulated pharmaceutical industry, so strict regulations and patent legislation must be adhered to in the manufacture and marketing of products. To provide patients and other users of our products with treatment using high-quality, safe and effective medicines, we must first obtain numerous approvals. Therefore, it is crucial to consider stakeholder interests throughout the entire process, particularly monitoring patients’ needs and satisfaction.
We maintain a continuous dialogue with key stakeholder groups, from employees to shareholders. Two trade unions, the Works Council, employee representatives on the Supervisory Board, and the Worker Director, represent employee interests and positions. Employees are regularly informed about important information within the Krka Group, and in their professional areas and sectors, they are more actively and directly involved in communication.
The administrative, management and supervisory bodies are regularly informed through departmental reports about information and activities related to sustainable business operations, including addressing the positions of affected stakeholders. These matters are addressed by the company’s Management Board, Supervisory Board, and various committees, primarily the Quality Committee, Development Committee, Human Resource Committee, Sales Committee, and Sustainability Committee. Operationally, the positions and interests of the affected stakeholders are discussed at the level of specific fields of expertise.
In the Krka Group, human rights are directly integrated into all aspects of our business. They play a crucial role in business decision-making and honouring corporate social responsibility commitments. They are also a part of our strategy and business model and are incorporated into Krka’s Code of Conduct and the Integrity Plan. Impacts, risks and opportunities related to our own workforce arising from the operation of our business model and the implementation of the company’s strategy are included in the Integrity Plan and in the Risk Register, and are also factored in when defining the double materiality assessment. By engaging in inclusive communication, we facilitate a regular exchange of information and gain insight into the interests and perspectives of our employees. These insights are taken into account in our strategy and business model to increase Krka’s positive impact on employees, prevent negative impacts, reduce their likelihood, or eliminate their potential consequences while managing risks and seizing opportunities arising from our own workforce. To this end, the Krka Group continually implements numerous activities and measures. Key activities are planned in collaboration with the company’s Management Board and the Human Resource Committee by Human Resources and Safety and Health. The Chief Compliance Officer, Works Council, and trade unions also actively contribute to the preparation process.
Employees are included in strategic and business processes through structured mechanisms such as regular employee satisfaction surveys, Krka appraisal interviews with heads of departments, and cooperation with employee representatives. The results of these processes contribute to continuous improvements in our policies and practices related to personnel management, and the improvement of working conditions and organisational culture.
Managing the potential of employees is part of Krka’s development strategy. The members of the Works Council, who represent all organisational units, are a link between employees and the management team. Employees convey their views, ideas, opinions, suggestions, and questions through their council representatives, the Works Council President, or the Worker Director. The President of Krka’s Management Board, Krka’s Management Board member responsible for relations with the Works Council and trade unions, and Krka’s Worker Director regularly participate in Krka’s Works Council meetings. Additionally, all employees have direct access to them via email for communication.
Companies and representative offices, where a formal system of employee representatives has not been established, employees can express their opinions and suggestions through organised meetings with management and direct communication with their supervisors.
We regularly assess occupational health and safety, as well as job risks, while investing in enhancements to the working environment. By regularly gauging the organisational climate, we track employee satisfaction and motivation, driving continuous improvement. The results are presented to Krka’s Human Resource Committee, which addresses key challenges and opportunities in this area. Based on these findings, organisational units develop and implement targeted action plans. Progress in implementing these plans and measures is systematically monitored and reported to the Human Resource Committee. The results of the organisational climate surveys are shared with the Works Council and organisational units.
We have a mechanism in place for reporting potential human rights violations, discrimination, and mobbing. Feedback and analyses obtained through this mechanism are also used to assess the impacts, risks and opportunities arising from the business model and the company’s strategy. This ensures that key factors affecting our employees are considered in business decisions, enabling appropriate adjustments in strategies related to managing our own workforce.
When considering the interests, perspectives, and rights of workers in the value chain, we started from the assumption that, due to the high level of vertical integration in the Krka Group, workers in the upstream value chain are primarily involved in activities and related tasks similar to those of Krka Group employees. They are exposed to similar potential impacts, including respect for individual rights. We are fully aware of this in the Krka Group, which is why we have already included, as one of our strategic activities in our business strategy, the establishment of a due diligence policy and related activities to ensure compliance with the CS3D Directive. In our dealings with direct partners, we are also consistent in fulfilling all obligations and the necessity of obtaining the appropriate permits arising from contractual relationships.
Our vertically integrated business model means we systematically record the needs, requirements and satisfaction of consumers and end-users (patients and other users of our medicinal products, healthcare professionals, healthcare providers, and direct customers). When engaging with patients directly, we are strictly bound by legislation. Consequently, we can only gain insights into their interests and perspectives indirectly through the professional community public, which interacts directly with patients and other users of our medicinal products. This allows us to incorporate the interests, perspectives, and rights of our key stakeholder groups into our development strategy. A fundamental aspect of this approach is our commitment to respecting human rights, including the right to health, which is closely tied to ensuring the continuous supply of medicines. This remains one of our priority areas, where we strive to maximise our positive impacts.
We fulfil our mission of Living a healthy life through our expertise, experience, cutting-edge technologies, innovation, a diverse range of high-quality, safe, effective, and accessible products, attentiveness to customers and end-users, and responsibility towards them. We operate in compliance with strict laws on product development, production, marketing and sales, ensuring the safety of end-users. Reporting adverse reactions to medicines is another regulated area which requires us to carry out various activities and adopt appropriate actions when necessary. Our pharmacovigilance system complies with legal requirements, EU guidelines (Commission Implementing Regulations (EU) No 520/2012 and (EU) 2021/1281 on the performance of pharmacovigilance activities) and guidelines on good pharmacovigilance practices.
As part of our double materiality assessment, we have identified material impacts, risks and opportunities within the topical standard S4 – Consumers and end-users. This standard primarily relates to ensuring quality, safe, effective, and accessible products. A detailed overview of material impacts, risks and opportunities is provided below.
The Krka Group’s business operations primarily impact the social domain, followed by the natural environment and corporate governance. Since we manufacture generic medicines, mainly prescription pharmaceuticals for chronic diseases, our most direct societal contribution lies in ensuring an uninterrupted supply of quality, safe and effective medicines, and a broad range of innovative products across various therapeutic areas. The foundation of our development strategy lies in the research, manufacture, and sale of these products, which are directly linked to our key strategic objectives and activities. More detailed descriptions can be found in other sections of the annual report’s business segment, including the sustainability statement.
In the environmental domain, we have identified material positive impacts that contribute to environmental protection, reducing our ecological footprint and ensuring the efficient use of natural resources, alongside potential negative impacts. There are also material positive impacts related to our workforce, which we detail in topical standard S1 – Own workforce (further elaborated below). Due to the broad scope of our operations, our positive impact on the workforce extends to other value chain segments, particularly upstream. These areas are, therefore, strategically addressed in Krka’s development strategy. Most material impacts are present and expected in both the short and long term, occurring within our operations and across different value chain segments, as detailed in the following table. Most material impacts, risks and opportunities – both actual and potential – are persistent, leading us to assess that they will remain material in the long run. Given our vertically integrated business model, most material impacts, risks and opportunities generally arise within our operations and in the upstream and downstream value chain. However, most material risks tend to emerge in the upstream value chain.
| Topical area in ESRS | Upstream value chain | Own operations | Downstream value chain |
|---|---|---|---|
| E1 – Climate change | x | x | x |
| E2 – Pollution | x | ||
| E3 – Water and marine resources | x | ||
| E4 – Biodiversity and ecosystems |
By using renewable energy sources, promoting sustainable mobility, implementing an energy management system, reducing our carbon footprint, and implementing other measures, we contribute to climate change mitigation and adaptation. Our energy management strategy ensures a reduction in specific energy consumption relative to production volume, leading to efficient energy use and a lower environmental burden.
Krka’s operations and value chain contribute to climate change.
Adapting to climate change, mitigating its effects, and improving energy efficiency enhance the resilience of our business model, reduce operating costs, increase our attractiveness to stakeholders, and strengthen our corporate reputation.
Extreme weather events caused by climate change (physical risks) can disrupt operations, supply chains and logistics, leading to increased operating costs. Rising emission allowance prices, reduced free allowances, or stricter emissions trading system (ETS) may drive up operating costs. The shift to new, low-GHG emission technologies – many of which remain untested – along with necessary investments, tightening regulations, and growing stakeholder expectations (transition risks) may pose challenges to the company’s competitiveness. Higher electricity and raw material costs, excessive dependence on fossil fuels, and volatility in energy markets could affect energy supply reliability, disrupt business operations, and negatively impact cost efficiency.
We assess that Krka is exposed to moderate physical risks in the short, medium, and long term. These risks do not affect our assets but may impact our operations. Potential transition risks linked to increased operating costs and investments in new, still-unknown technologies are expected to be more significant in the long term.
As part of our regular strategic planning, we will consider climate risks and their potential consequences, ensuring appropriate strategic activities and resources for climate adaptation and mitigation. We assess that the Krka Group does not own assets or engage in activities incompatible with the transition to a climate-neutral economy. A resilience analysis of our strategy and business model against climate scenarios has not yet been conducted.
We employ the best available techniques and efficient systems for treating waste air and waste water from production processes. We ensure the safe storage and handling of substances and materials used in production and implement measures to prevent environmental pollution.
We ensure responsible water consumption, water withdrawals and discharges. This includes rational water use, monitoring consumption with a computerised system, reusing rinse water, efficient waste water treatment, and maintaining the quality of water bodies.
Exceptionally long drought periods may disrupt the uninterrupted supply of water resources essential for pharmaceutical production.
By reducing the impact of our activities on climate change, preventing and minimising environmental pollution, promoting efficient resource use and circular economy principles, and encouraging responsible care for the environment both locally and more broadly, we contribute positively to biodiversity conservation and ecosystem protection.
Ineffective implementation of measures to mitigate climate change or excessive environmental pollution may negatively affect biodiversity and ecosystems.
All our production facilities are concentrated within their respective sites and do not significantly sprawl into ecologically sensitive areas. Actual and potential material impacts on biodiversity loss arise from the Krka Group’s and its value chain’s contribution to climate change and pollution associated with pharmaceutical production. The Krka Group has production sites in five countries. Key production capacities are set up within the controlling company in Slovenia, namely in Novo mesto (the Ločna production site and the Bršljin production site), Šentjernej, Ljutomer, and Krško. None of the facilities is within the Natura 2000 protected area network. Our Ločna site is near the River Krka, a biodiversity-sensitive area. API and pharmaceutical production and product packaging take place at the site. The River Krka is an important source of water used in cooling processes, particularly in API production and technological water preparation for power supply and production. The area around the River Krka is an important ecological area (IEA) and part of the European ecological network Natura 2000, as it is an important natural habitat of numerous aquatic and riparian plant and animal species, especially fish, amphibians and birds. Under the Nature Conservation Act, an IEA is a designated area that plays a significant role in biodiversity conservation, while Natura 2000 demonstrates our commitment to preserving natural heritage vital to both Slovenia and Europe. Responsibilities are defined in the European Birds Directive and the Habitats Directive. The River Krka is a habitat for several threatened species. These include fish species such as the asp, huchen, and cactus roach, thick-shelled river mussel, olm, and the European otter and beaver, which are not significantly affected by Krka’s activities. The collection of river water and discharge of treated waste water from our waste water treatment plant do not threaten the preservation of aquatic and riparian areas or the conditions for connecting these areas.
Other key Krka production sites engaged in production and product packaging include TAD Pharma GmbH (Germany), Krka-Farma d.o.o. (Croatia), Krka - Polska Sp. z o.o. (Poland), and Krka-Rus LLC (the Russian Federation). Activities at all our production sites comply with national legislation and environmental protection permits, which has a positive impact on biodiversity and ecosystems.
We have not identified any material negative impacts with regard to land degradation, desertification or soil sealing. Our operations do not materially affect threatened species.
We are aware that natural resources are limited, which is why we constantly seek opportunities and implement activities to minimise and make the use of resources as effective as possible. This is ensured through continuous optimisation of technological processes, optimisation of packaging materials, and innovative approaches in product development and manufacture, especially for single-pill combinations. Due to strict regulations, we are highly limited in introducing circular economy practices in the production of pharmaceutical products. We strive for responsible waste management. Waste materials generated at the end of processes, which cannot be reused due to regulatory restrictions that govern pharmaceutical production, are managed responsibly – sorted appropriately and handed over for processing, recycling, or energy recovery.
Irrational use of natural resources affects the sustainability and availability of natural resources.
With nearly 13,000 employees, the Krka Group has a significant direct social impact on its own workforce. We ensure the highest standards of occupational health and safety. We respect internationally recognised human rights, workers’ rights, and fair employment practices. We strive for employee diversity, inclusion and participation, equal treatment and opportunities. We provide employees with fair wages, ensuring gender equality and equal pay for work of equal value, along with opportunities for personal and career development, and education to improve knowledge and skills. We implement flexible work arrangements and promote a healthy lifestyle. We support employees in balancing their professional and private lives. Our industry is less susceptible to negative economic cycles, ensuring employee job security and stability. Trade unions and the Works Council provide opportunities for social dialogue and freedom of association.
Identifying and recruiting talent, developing them into top professionals providing opportunities for personal and career growth, and systematically managing employees contribute to employee engagement, productivity, and innovation. This enables the successful implementation of our business strategy, ensuring long-term business stability and strong business performance. Expanding talent development programmes and further digitalisation and automation of work processes improve competitiveness and the company’s reputation among potential employees. Secure and stable employment, good working conditions and corporate culture present an opportunity to attract new employees and reduce turnover.
In the pharmaceutical industry, the production process requires shift work, which employees or potential candidates may perceive as less attractive. This could lead to higher turnover rates and reduce the company’s ability to ensure uninterrupted production and business operations. A shortage of qualified labour may hinder our ability to meet planned production and sales volumes, provide accessible healthcare, and meet business goals.
Working in the pharmaceutical industry requires a skilled workforce at all levels. A highly qualified workforce is essential for ensuring quality, safe and effective pharmaceutical products. A shortage of suitable personnel or high employee turnover can impact operations and the achievement of business objectives. We carefully and strategically plan activities related to our workforce to foster positive impacts and to reduce the likelihood of potential consequences of negative impacts – or to address them as effectively and swiftly as possible. Through this approach, we strive to maintain a safe and healthy work environment, uphold human and labour rights, and ensure fair compensation. We strategically plan recruitment, training, workforce development, retention, personal and career growth, and education for skills and knowledge development while promoting a healthy lifestyle. Opportunities for social dialogue and freedom of association are ensured through trade unions and the Works Council at the Krka Group and its subsidiaries, if they are organised in this manner. Investing in a safe and healthy work environment, identifying and recruiting talent, developing them into top professionals, ensuring a skilled workforce through the national vocational qualification programme, providing opportunities for personal and career growth, and systematically managing employees contribute to employee engagement, productivity, and innovation. These opportunities enable us to retain talent and attract new employees, allowing us to implement our business strategy, ensure long-term business stability, and achieve our planned business results. We address the risks associated with a potential shortage of qualified workforce through various measures that help ensure business operations remain unaffected.
Disclosures related to own workforce apply to all internal personnel/employees with regular employment contracts with Krka Group’s subsidiaries or representative offices, regardless of their position or hierarchical level, as well as Krka Group employees. Disclosures related to own workforce cover all regular employees in production, quality control, research, marketing-and-sales, and support functions, where the company directly manages working conditions, occupational safety, and human resources. It applies to both full-time and part-time employees. Employment contracts per national labour laws include specific rights, responsibilities, obligations, and other provisions.
In some subsidiaries, some employees work through employment agencies. Potential material negative impacts are not widespread. In specific countries or regions outside the EU where Krka operates, they are not systemic, do not involve child or forced labour. Material positive impacts apply to all employees and agency workers in the Krka Group and are not limited to specific countries or regions. They stem from providing stable employment, a safe and healthy working environment, and rights that apply to all employees. Additionally, numerous measures and activities are continuously implemented to promote and expand positive impacts on Krka’s employees. These are detailed under Disclosure Requirement S1-4.
In economically less stable countries and regions, stable employment in the pharmaceutical industry offers employees greater social security. The Krka Group recognises that relying on a qualified and motivated workforce directly affects its operational performance, competitiveness and long-term stability of its business model. A potential shortage of adequately skilled personnel poses a risk that could impact the company’s operational efficiency and competitiveness. Employee turnover, whether due to shift work or heightened competition for skilled professionals, can affect the stability of production processes and increase hiring costs.
When identifying these risks, the Krka Group also recognises opportunities to improve the working environment and competitiveness. Investments in employee training and upskilling lead to increased productivity and long-term stability of human resources. Optimising work conditions, including flexible work arrangements and a positive working environment, reduces employee turnover and increases employee engagement. Process digitalisation and automation improve operational efficiency, reduce physical strain on employees, and attract new talents. High occupational safety standards improve employee health, reduce workplace absences, and contribute to a stable working environment.
To mitigate risks and seize opportunities, we strategically invest in employee training and development, improve working conditions, and implement measures to attract and retain talent.
We have not identified any material impacts on our workforce arising from plans to reduce environmental impacts, ensure greener and climate-neutral activities, or implement carbon emission reduction measures in line with international agreements. Likewise, we have not identified any impacts, risks and opportunities related to restructuring, job losses, job creation, retraining, or upskilling.
Krka does not operate in industries, countries and regions with a high risk of incidents related to forced or child labour. Every job position undergoes an employee risk assessment. We conduct risk assessments for all new or modified technological procedures. Krka’s occupational health and safety system is ISO 45001-certified and is fully incorporated into our quality management system. The health and safety management system covers all employees in subsidiaries in line with the national legislation and corporate recommendations.
At the Krka Group, we also employ persons with disabilities. In line with the occupational health and safety management system (ISO 45001), we regularly assess risks for all job positions, placing special focus on pregnant women, older employees, employees with medical work restrictions, persons with disabilities, shift workers, and those handling hazardous substances. To mitigate these risks, we implement tailored measures such as additional protective equipment, adjusted working hours, modified work tasks, and specialised training programmes. All changes in work processes undergo a risk assessment to ensure safe working conditions for all employees.
We have not identified risks arising from the impact on or dependence on specific groups within our workforce that do not apply to the entire own workforce.
Through an effective due diligence process within our value chains, as well as investments in know-how, equipment, technology, and quality, we create a positive impact on workers within the value chain. This, in turn, enhances the efficiency of supply and distribution chains, improves product quality, and contributes to greater treatment accessibility. By promoting respect for human and labour rights and fair employment practices, we support stable business operations and the timely supply of quality resources. This ensures uninterrupted production of medicines and reliable supply for patients.
Pharmaceutical supply chains are global and complex, which can lead to negative impacts such as human rights violations, inadequate working conditions, and health and safety risks for workers, particularly in regions where labour protection laws are weaker.
In 2025, we will draft the 2026–2030 Krka Group Development Strategy and, in parallel, identify in more detail strategic activities related to managing material impacts, risks and opportunities arising from impacts and dependencies on value chain workers. In line with the Due Diligence Policy of the Krka Group, the Code of Conduct for Business Partners of the Krka Group, and the Human Rights Policy of the Krka Group, we will initiate the process of conducting human rights and environmental due diligence in 2025. Our initial focus will be on the supply chain, followed by compliance with the Due Diligence (CS3D) Directive and the value chain. The Krka Group’s business model also aligns with our strategic orientation, allowing for a high level of vertical integration, thereby contributing to the management of sustainability impacts, risks and opportunities. In line with the Disclosure Requirement ESRS 2 SBM-2 – Interests and views of stakeholders, the Krka Group, as a key partner of many stakeholders across its extensive value chain, actively promotes high standards of human rights and environmental protection through its broad reach and impact. The Group also prevents, mitigates and remediates the consequences of risks that might arise in the value chain and, in turn, reduces the risks arising from its business model and dependencies on value chain workers.
When fulfilling the requirements of ESRS 2 SBM-3, paragraph 48, we included all value chain workers in the scope of the disclosure. We assessed the impacts, risks and opportunities by factoring in internal information available to experts in specific fields who regularly engage with the representatives of material stakeholder groups in the value chain through their business relationships. The experts were mainly involved in purchasing, technical purchasing, API R&D and production, pharmaceutical R&D and production, and sales and marketing.
Our assessment showed that material impacts, risks and opportunities in the downstream value chain (related to sales) mainly arise from the following strategic sustainability areas identified for Krka: accessible healthcare; product quality and patient safety; and compliance, integrity, and transparency. In the upstream value chain (related to supply), the impacts, risks and opportunities also arise from Krka’s strategic sustainability areas: planet and climate change; and good leadership and governance practices. Value chain workers include all workers of our direct customers and their downstream business partners and all workers of our direct suppliers, partners and their upstream business partners that produce and supply key input raw materials and other materials, active ingredients, bulk products, finished products, technological equipment, and services. Certain workers in the upstream value chain may come from regions with increased risks, mainly countries classified by the World Bank as lower- to middle-income, especially in Asia. There are only a few such workers in Krka’s supply chain. Our assessment found no indication that value chain workers face significant risks due to the transition to greener and climate-neutral operations based on currently available information. Most value chain workers work outside the Krka Group on sites outside our business units. Workers working on the company’s sites but who are not part of our own workforce are not exposed to material negative impacts and risks because we carry out activities and take actions to prevent or mitigate such impacts and risks. We did not identify other categories of workers who could be materially impacted by the company, including impacts connected with our own operations and value chain, including through our products or services, as well as through our business relationships.
We expect our business partners to provide high-quality, safe, and effective products and services that fully comply with contractually agreed standards, applicable laws, and other regulations. This means that business partners involved in the supply, manufacture, packaging, storage, and distribution of materials or products for Krka or on its behalf must ensure compliance with the relevant quality regulations and GxP good practices, including good manufacturing and good distribution practices. To this end, we hold educational courses for our key business partners and encourage them to integrate appropriate business practices, mainly those related to occupational health and safety, quality, and employee training and qualification. We screen our customers and suppliers. Purchase and transport agreements concluded with our suppliers and contractors require them to comply with national and international laws and regulations, including those governing occupational health and safety management (ISO 45001) and environmental management systems (ISO 14001). We also regularly screen our suppliers and contractors. We adopted the Code of Conduct for Business Partners of the Krka Group and plan to further enhance our human rights and environmental due diligence processes and activities. Our goal is to strengthen our positive social impact, uphold and advance ethical principles and standards, promote respect for human rights, and support environmental protection. Our long-term partnership and business growth directly contribute to job creation, especially in the supplier chain.
Risks and opportunities for the Krka Group arising from impacts and dependencies on value chain workers primarily relate to two of our strategic sustainability areas, i.e. accessible healthcare (uninterrupted supply of medicines and affordable medicines) and product quality and patient safety (providing quality, safe and effective medicines and active ingredients). By pursuing opportunities, we strive to improve the supply chain’s resilience and ensure uninterrupted operations, two aspects of our strategic sustainability area on good leadership and governance practices.
systems in place to manage complaints and recalls. We are committed to high-quality standards and responsible product sales and marketing practices. Additionally, we provide expert support to healthcare professionals and actively raise awareness among various public groups about healthy lifestyles and the recognition of common diseases.
(negative)
Failure to meet quality standards could impact patient and end-user health. Adverse reactions may occur during product use. Disruptions in product supply and non-availability of products may have an impact on accessible healthcare and the health of people.
Developing and manufacturing quality, safe and effective medicines based on scientific findings, including innovative single-pill combinations, simplifying treatment, improving treatment success, and positively influencing business performance. Maintaining high standards of quality, safety and efficacy, compliance with regulations and standards, and ensuring uninterrupted product supply strengthen reputation and drive business success.
Non-compliance with strict regulatory requirements, GxP standards, and quality benchmarks that ensure the safety of patients and end-users could negatively impact the company’s reputation, market share, and business results.
We differentiate two types of consumers and users of our products:
Both groups are positioned in Krka’s downstream value chain. Disclosures refer to all customers and end-users who can be materially impacted through our own operations, including our products and services, our business model and strategy, which rely on an uninterrupted supply of quality, safe and effective medicines. Our business model and development strategy place a strong emphasis on quality. We hold numerous regulatory approvals and comply with good manufacturing and marketing practices and ISO standards, particularly: ISO 14971 (Krka) relating to risk management for medical devices, and ISO 9001 relating to quality management (Krka). This also entails business risks arising from these impacts on customers and end-users.
We provide users of our products with access to medicines for treating, relieving and preventing diseases. The end-users of our products are primarily patients with chronic cardiovascular, central nervous system and gastrointestinal diseases, diabetes, and those requiring systemic treatment of infections, as well as individuals using products to improve cerebral and peripheral circulation. A special group of end-users includes companion animals, for whom our animal health products, particularly antiparasitics, are intended.
We regularly inform healthcare professionals and healthcare service providers (physicians, veterinarians, pharmacists), who prescribe or dispense our products to end-users, about our products, allowing them to make informed decisions about which product is most suitable for their patients and other users. They, in turn, give us feedback on our products.
Our direct customers include distributors (wholesalers), pharmacies, hospitals, specialised stores and other pharmaceutical companies. We impact these buyers most through business relationships.
Krka Group products are not inherently harmful to humans and do not increase the risk of chronic diseases. Krka Group services do not negatively impact end-users’ rights to privacy, personal data protection, freedom of expression and non-discrimination. At the Krka Group, we do not collect data on patients as end-users, nor do we engage with them directly (except through permitted advertising of non-prescription products) as this is prohibited by strict pharmaceutical legislation (primarily governed by Directive 2001/83/EC, the framework EU act on this subject matter). This ensures that we do not infringe upon their rights to privacy, personal data protection, freedom of expression and non-discrimination.
We engage with the expert community (physicians, pharmacists, and veterinarians) and direct customers (distributors). The right to privacy of the expert community and employees of direct customers is protected through strict compliance with personal data protection legislation.
All patients rely on accurate product information so they can use medications correctly. We label our products and provide appropriate patient information leaflets in accordance with the laws on labelling and providing patient information leaflets. Our quality system ensures that each unit and each batch are labelled in compliance with the guidelines and registration documents. The patient information leaflet attached to each product specifies how to correctly use the medicine, who can take the medicine, what the medicine’s indications and contraindications are, and which patient groups are exposed to a potentially higher risk when taking the medicine. We have risk management plans in place for each medicine.
Before a medicine is put on the market and sold, we obtain a marketing authorisation from national regulatory authorities in line with the applicable legislation. Patients must also receive proper instructions on the use of a medicine from health professionals, such as physicians who prescribe the medicine and pharmacists who dispense the medicine in the pharmacy. These instructions are crucial for patients with co-morbidities who are at higher risk of drug interactions. Therefore, we also provide regular training for healthcare professionals on Krka’s products, enabling them to offer appropriate guidance to patients and contribute to the best possible treatment outcomes.
Any patient can use our medicines regardless of age, gender, financial situation, or other personal circumstances. The patient information leaflet of each medicine has separate sections on particularly vulnerable groups, e.g. children and adolescents, older patients (appropriate dosing regimen), pregnant women (whether the medicine may or may not be used during pregnancy), and special populations. We also pay special attention to blind and visually impaired individuals, which is why all product packaging includes the appropriate markings.
Potential negative impacts may result from individual incidents, such as non-compliant product quality, which may impact on the health and safety of patients and end-users. Adverse reactions may also occur when using the products. The likelihood of potential negative impacts is very low. However, they may arise in any market where a product is sold if it does not meet quality standards. Potential negative impacts related to adverse reactions may be caused by incorrect use of the medicine (incorrect dosing or treatment duration, off-label use, or abuse). Potential negative impacts are not connected to specific business relationships. Disruptions in product supply and non-availability of products may have an impact on accessible healthcare and the health of people. Medicine shortages, often caused by supply chain delays, may affect consumers and end-users, potentially leading to unintended disparities in medicine availability for certain patient groups or markets. Additionally, prolonged or complex marketing authorisation procedures may further delay product launches, affecting market accessibility.
Providing accessible, effective, quality and safe medicines, especially those for treating chronic diseases, directly contributes to improved public health. Every day, our products reach more than 100 million patients and users. Our focus lies in developing complex medicines. We develop and manufacture advanced pharmaceutical forms, such as prolonged-release tablets, matrix tablets, tablets that incorporate OROS technology, and other innovative delivery systems. Our product portfolio includes 150 single-pill combinations, the highest among generic medicine manufacturers. Physicians often prescribe them to make therapy easier and improve patient compliance, enhancing treatment success. Some patients experience difficulties with swallowing, so we provide orodispersible tablets that dissolve in the mouth without needing liquid. Our folding boxes include Braille text to accommodate visually impaired individuals, ensuring easier access to medication information. This supports patients in managing their daily medicine intake as seamlessly as possible. Many of our products are specifically designed for use in hot climates, particularly in regions where numerous countries fall into the low- to middle-income category, as defined by the World Bank.
We ensure fair disclosure of adverse reactions, proper product labelling, anti-counterfeiting, and information on medicines and their use, thereby reducing the risk of medication errors and adverse reactions. We implement measures to collect and assess adverse reactions and other medicine-related safety issues and measures to manage and mitigate medicine-related risks. We have systems in place to manage complaints and recalls. We are committed to high-quality standards and responsible product sales and marketing practices. Additionally, we provide expert support to healthcare professionals and actively raise awareness among various public groups about healthy lifestyles and the recognition of common diseases.
We recognise the paramount importance of clinically proven medicines and monitor their efficacy, safety, and quality during marketing authorisation procedures and after obtaining relevant marketing authorisations. To that end, we conduct bioequivalence studies and research in pre-authorisation phases and support post-authorisation clinical research. Clinical studies performed with Krka medicines help healthcare professionals make the right decisions, improve treatment success and advance the medical field. We ensure high quality, transparency and ethics in clinical research by complying with laws, guidelines by the International Council for Harmonisation (ICH) and other bodies, and the Helsinki Declaration.
Material risks arising from material potential negative impacts on consumers and end-users relate to non-adherence to stringent requirements for regulatory compliance, compliance with good pharmaceutical (GxP) practices and quality standards that ensure patient and user safety.
Material opportunities arising from positive impacts on consumers and end-users comprise the development and manufacture of quality, safe and effective medicines based on scientific evidence, including innovative single-pill combinations, which simplify treatment, improve treatment success, and have an effect on business results. Maintaining high standards of quality, safety and efficacy, compliance with regulations and standards, and ensuring uninterrupted product supply strengthen reputation and drive business success.
No specific risks of increased harm arising from potential negative impacts on specific consumer or end-user groups have been identified. The patient information leaflet attached to each product specifies how to correctly use the medicine, who can take the medicine, what the medicine’s indications and contraindications are, and which patient groups are exposed to a potentially higher risk when taking the medicine. We regularly review and update the information to reflect new scientific developments, promptly revise patient information leaflets, and secure approvals from the competent authorities. We have risk management plans in place for each medicine. Before a medicine is put on the market and sold, we obtain a marketing authorisation from national regulatory authorities in line with the applicable legislation.
By adhering to the highest standards of corporate governance, ethics and integrity, we foster a strong corporate culture among employees, partners and other stakeholders. Throughout the value chain, we promote adherence to sustainable business guidelines, thereby materially contributing to environmental protection, positive social impacts, and a high level of corporate governance. In accordance with procurement and payment terms, we ensure equal conditions for all suppliers, maintain timely payment of invoices, and thus safeguard their financial stability. Krka’s suppliers must meet strict quality and regulatory requirements, enabling us to provide quality, safe and effective medicines. We have established appropriate procedures for reporting and handling suspected irregularities, and we ensure the protection of whistleblowers in accordance with legislation. We contribute to animal health by developing and offering new animal health products while adhering to legislation and guidelines for animal welfare. We also promote preventive care in animals, reducing the risk of disease occurrence and preventing unnecessary suffering. Our animal health products have a positive impact on the development of sustainable agriculture, which helps maintain the balance of the ecosystem. We contribute to healthy and safe foodstuffs and the protection of humans against foodborne diseases and zoonoses by preventing and controlling disease outbreaks in farm animals.
Operating in accordance with the highest standards of corporate governance contributes to the company’s long-term business success and reputation. By raising awareness among business partners about the importance of corporate culture and enforcing codes of conduct, we improve long-term cooperation, foster fair partnerships and reduce the likelihood of risks that could impact the company’s reputation and business performance. Proper supplier relationship management, including payment practices, ensures uninterrupted functioning of the supply chain and uninterrupted business operations and prevents disruptions in the supply chain that could affect product supply and quality. By implementing appropriate measures for preventing, detecting and investigating fraud, we reduce the likelihood of such activities, financial losses, and potential negative impacts on the company’s reputation. With a broad range of quality, safe and effective animal health products, we contribute to animal welfare, which, in turn, positively influences business results through animal health product sales.
An inadequate level of corporate culture, transparency, ethics, and integrity can impact the company’s reputation, stakeholder relationships and business performance. Poor payment practices may create risks of non-compliance with contractual agreements with business partners, potentially disrupting operations, product supply and quality, while also jeopardising the company‘s reputation and business results. Potential incidents related to corruption and bribery could harm the company’s reputation and result in financial losses. The risk of failure to meet the appropriate standards for animal health product quality may affect animal welfare, the company’s reputation, and business success.
and opportunities affecting its business model, value chain and decision-making, and strategically plans its operations accordingly. In business areas closely linked to sustainability – where the company has the most material impact, as well as the highest risks and opportunities – we systematically enhance our processes and activities to effectively manage material impacts, risks and opportunities. To this end, in 2024, we adopted several new corporate policies that establish our fundamental guidelines and objectives.
With regard to our own operations, we revised the Environmental Policy of the Krka Group (outlined in section E1-2) and aligned it with six European environmental goals. In the area of our own workforce, we introduced the Diversity, Equity and Inclusion Policy of the Krka Group (outlined in section S1-1) and the Human Rights Policy of the Krka Group (outlined in section S1-1). To more effectively manage the impacts, risks and opportunities arising from our value chain, we adopted the Due Diligence Policy of the Krka Group (outlined in section S2-1) and the Code of Conduct for Business Partners of the Krka Group (outlined in section G1-1). Based on these policies and the Code, we plan to establish a due diligence process and activities focusing on human rights and environmental protection, initially in the upstream value chain.
We have strategically defined and set clear sustainability goals in recent years, which we will revise in the 2026–2030 Krka Group Development Strategy. This updated strategy will address the impacts, risks and opportunities associated with individual topical areas under ESRS more directly. In our latest Risk Register, we have specifically defined a category for other sustainability risks and emerging sustainability risks. Based on all currently available information, including information on sustainability impacts, risks and opportunities, as well as known technologies, we do not foresee material changes to our strategy and business model. We believe such changes are unnecessary, as our current and expected measures and activities effectively manage sustainability areas. This is mainly due to our high level of vertical integration, which enables a more direct relationship with stakeholders and direct involvement at all key levels of the value chain.
We closely monitor developments in this field, stakeholder expectations and interests, and legislation to ensure timely and appropriate responses. We pay particular attention to environmental matters, especially climate change adaptation and mitigation, as well as section S4, which relates to consumers and end-users of our products – an area where our social impact is the most significant.
Based on the currently available information, estimates, forecasts and other data, the Krka Group has not identified any material current financial impacts and opportunities that would materially impact its financial position, financial performance, cash flows and material risks and opportunities where there is a considerable likelihood that they will cause substantial adjustments in the book values of assets and liabilities as reported in the related financial statement during the next reporting period. This assessment is based on Krka’s development strategy, our current business model, the nature of our primary activity – pharmaceutical production – and the related business activities in our operations and in connection with the risks and opportunities arising from the value chain. We assess that the measures and activities we are undertaking, along with the established metrics and objectives, are appropriate, and do not present a material risk for now. The reliability of these assessments is tied to the reliability of information, estimates, and forecasts. In future periods, we will monitor changes in the business environment and prepare a more detailed analysis of current and expected financial impacts related to material sustainability impacts, risks and opportunities.
The Management Board of the company assessed that the Krka Group, due to its vertical integration business model and the implementation of its strategy, is resilient and capable of appropriately addressing material impacts and risks while seizing opportunities. Key strategic and current activities are focused on identified material sustainability areas where our largest impacts, risks and opportunities arise or could arise. We have not yet conducted specific resilience analyses but plan to study individual areas in more detail through climate scenario analysis and similar methods. We will monitor their development so we can more precisely and promptly identify any need to update our strategy and business model, particularly in the medium- and long-term periods.
In 2024, we conducted our first double materiality assessment in line with the EFRAG standards and EFRAG guidelines.
In 2021 and 2022, Krka conducted a process to identify and assess the materiality of sustainability topics in accordance with GRI standards. This process was upgraded, and in 2024, it was adapted to meet the requirements of ESRS and the EFRAG guidelines. The definition of material impacts, risks and opportunities was carried out for our own operations as well as the upstream and downstream value chains. This included activities of direct stakeholders (customers, suppliers, other direct stakeholders) and indirect partners (N-tier customers and suppliers and their employees).
The organisational structure of the Krka Group is characterised by the fact that the controlling company fully directs and supervises the operations of its subsidiaries and representative offices. The ‘function for function’ principle gives representatives of various functions in the controlling company a thorough understanding of the situation in subsidiaries and representative offices. Additionally, the Krka Group is recognised for its business model with a high level of vertical integration, meaning it fully controls activities related to the development of active ingredients, pharmaceutical development, manufacturing process, quality management, marketing authorisations, clinical studies, marketing, sales and distribution. Due to these characteristics, it has been assessed that the impacts, risks and opportunities in the value chain outside Krka’s own operations are largely the same or very similar to those within its own operations, except in certain specific cases primarily related to geographical location.
Going forward, we plan to further improve the entire IRO assessment process in line with this approach. In assessing the value chain, we relied on all available information held by Krka’s experts across various business areas derived from regular business interactions with stakeholders. We did not directly involve representatives from the value chain, nor did we obtain data from them directly. As part of GRI-based reporting in previous years, we engaged certain stakeholder groups to verify the materiality of specific sustainability topics from the perspective of their impact on stakeholders. The research included representatives of key stakeholder groups, such as investors, analysts, doctors, pharmacists, employees, representatives of local communities, distributors, the chamber of pharmacy, trade unions, universities, the chamber of commerce, as well as institutes and professional associations. The main topics of discussion always include the most important sustainability matters, so we are well aware of their expectations.
Based on regular communication with all key stakeholder groups, we assessed at the beginning of the year that their expectations – particularly regarding the areas most important to each stakeholder group – had not changed. As a result, we did not conduct a new stakeholder engagement process through surveys and interviews in 2024. However, we will undoubtedly do so in the future as this area continues to evolve. Krka operates in the highly regulated pharmaceutical production and distribution sector. As a result, legislation and regulations have a significant impact on our development, regulatory, manufacturing, marketing, sales, and other activities. Within the quality management system, GxP standards, and numerous ISO standards, our impacts and risks are under constant monitoring and management and are regularly audited by regulatory authorities, customers, and institutions. In our IRO assessment, we also considered the insights from these stakeholder interactions.
The following section outlines the phases of the process for defining and assessing material impacts, risks and opportunities (IRO).
The definition was carried out at the subtopic level through multiple internal workshops involving sustainability officers (representatives from various business areas) and other Krka experts familiar with the impacts, risks and opportunities related to specific topical standards. The definition of stakeholders was approved by Krka’s Management Board.
The assessment was conducted using standardised qualitative and quantitative criteria:
The assessment was carried out by sustainability officers and other Krka experts familiar with the impacts, risks and opportunities related to specific topical standards. Their assessments were confirmed by heads of individual organisational units, including the Management Board member responsible for sustainability.
The interdisciplinary team defined in points a) and b) evaluated the assessments and material sustainability impacts, risks and opportunities based on impact materiality and/or financial materiality. This was done using a consistent methodology and predefined materiality thresholds.
A sustainability impact was determined as material in the case of a negative impact on human rights or a potential negative impact on human rights (with medium or high probability). In doing so, we also assessed the measures adopted to mitigate potential negative impacts and whether we have actual positive impacts on human rights related to the topic in which this potential negative impact is classified. An impact was also identified as material when the following criteria were simultaneously met:
The interdisciplinary team defined the sustainability risk or opportunity as material if:
A sustainability topic was assessed as material if it was material in terms of impact (on people or the environment) or material in a financial sense. Krka’s Management Board formally approved the final results of the process. The Sustainability Committee and the Supervisory Board also reviewed the results.
We have not yet established a comprehensive and systematic due diligence process for monitoring potential and actual impacts of our activities in both the upstream and downstream value chains. However, we have committed to this through our Due Diligence Policy (outlined in S2-1). The foundation for the due diligence process will be the Code of Conduct for Business Partners of the Krka Group (outlined in G1-1), the Environmental Policy of the Krka Group (outlined in E1-2) and the Human Rights Policy of the Krka Group (outlined in S1-1), all adopted in 2024, as well as other relevant Krka documents and policies governing this area.
In the process of identifying, prioritising, and monitoring potential and actual impacts, we focused on:
We prioritised our negative impacts that affect human rights. We identified them as material regardless of assessments based on other criteria. All identified impacts were also considered in terms of risks and opportunities, and vice versa. Other interconnections and dependencies among the identified impacts, risks and opportunities were not taken into account in the 2024 assessment.
When addressing impacts arising from our own activities, we based our assessments on all impacts considered at the level of various Krka committees, the Risk Register, and the quality management system within the ISO 9001 standard, as well as, more specifically, the ISO 14001, ISO 45001, ISO 22301 and other ISO standards under which we operate, including good manufacturing and marketing practice standards within the GxP framework.
Sustainable business practices are integrated into Krka’s development strategy, which was updated at the end of 2023. In 2024, we updated the Risk Register, which is established for all business areas within the Krka Group and represents a comprehensive record of risks and control activities for managing individual risks. The Risk Register complements the Integrity Plan and addresses ethics, integrity, and compliance. As part of the materiality assessment process, we newly identified certain material impacts, risks and opportunities arising from the value chain, which had not been previously analysed in detail from this perspective. As part of the Risk Register update, we defined the category of other sustainability risks and emerging sustainability risks, which include the risk of transitioning to a carbon-neutral society, the risk of customer demands regarding sustainable business practices, the risk of responsibility for sustainability risks in the value chain outside the Krka Group, the risk of compliance with sustainability reporting requirements, and the risk of comprehensive sustainability risk management. Sustainability risks are also integrated into the preparation of the updated development strategy.
The internal control system related to the process of defining the double materiality assessment includes sector directors, heads of independent organisational units, and the sustainability coordinator, who review and approve the results. The results are also reviewed and approved by the Management Board member responsible for sustainability.
The process of identifying, assessing and managing sustainability opportunities is incorporated into the overall corporate governance process during the preparation of the development strategy.
The identification and assessment of impacts, risks and opportunities were carried out based on professional evaluations conducted by internal experts from individual business areas, along with an evaluation by the Management Board. Krka is reporting on impacts, risks and opportunities for the first time in accordance with ESRS standards. Any changes in the materiality of impacts, risks and opportunities compared to the previous reporting periods will be disclosed in the coming years. We plan to revise materiality assessments at least every two years.
We have considered all our business activities, site locations, and assets within our own operations, as well as available information about the value chain, focusing on its upstream part. This part performs the same or similar activities that are part of pharmaceutical production, as in Krka, and is crucial in the supply of raw materials, active ingredients, bulk products and finished products. Our business activities are centred around our production sites and the manufacture of pharmaceuticals. Based on this, we identified physical and transition risks. Certain transition risks are also closely linked to the transition plan, which we have not yet developed. However, these risks could materially impact the achievement of the transition plan’s objectives and related activities and will serve as the foundation for our transition plan. Physical risks in the form of extreme weather events, such as drought, high external temperatures and increased absolute air humidity, may lead to higher operating costs. Drought is associated with a material dependency on water resources, which we identified as a risk in the environmental topical standard E3. We have implemented appropriate measures and are actively carrying them out. We assess that the company’s assets are not particularly exposed or sensitive to the identified physical risks and do not materially impact their lifespan. However, we estimate that the identified transition risks could increase operating costs and create uncertainty in investment planning and related expenses, particularly for investments related to the transition plan and its activities, as well as long-term investments and activities connected to strategic planning and capital allocation.
To define the impact of GHG emissions, we have calculated GHG emissions for scopes 1, 2, and 3. We assess that physical and transition risks are very similar in our own operations and in both the upstream and downstream value chains. Outside our own operations, there is a significant difference in transition risks arising from different regions where regulatory frameworks vary or are absent, or where different emissions trading systems are in place or are yet to be established. As part of the IRO assessment, we have identified and assessed physical and transition risks that we estimate to be present in the short, medium, and long term. We have not yet conducted a detailed climate scenario analysis. Climate-related assumptions have not yet been incorporated into the financial statements.
In assessing impacts, risks and opportunities related to pollution, we considered all activities and locations in our own operations and available information about the value chain. Production sites are key sites in terms of our own operations. Our approach was based on the internal standard operating procedure (SOP) Environmental Management System, which prescribes a comprehensive environmental management process within the controlling company in accordance with legal requirements and the environmental standard ISO 14001.
We calculated the hazard for the water environment using the methodology from the European Medicines Agency (EMA) guidelines. We presented solvent mass balances in accordance with the statutory requirements. We did not apply pollution-related assumptions; however, we utilised EU guidelines on industrial emissions as outlined in best available techniques reference documents (BREF) from the available tools. We have not yet consulted with external stakeholders regarding the identification of impacts, risks, and opportunities related to ESRS E2.
When assessing impacts, risks and opportunities related to water and marine resources, we have considered all our business activities, site locations, and assets within our own operations, as well as available information about the value chain, focusing on the upstream value chain that performs the same or similar activities as Krka and is crucial in the supply of raw materials, active ingredients, bulk products and finished products. Our business activities are centred around our production sites and the manufacture of pharmaceuticals.
We also operate under the assumption that future legislation regarding water and marine resources, as well as waste water, which is indirectly but significantly related to this area, will change. Therefore, we monitor these areas and plan activities to achieve long-term compliance with legislation. In assessing material impacts, risks, and opportunities related to water and marine resources, we utilised tools such as internal data on the quality and consumption of drinking and river water, and the results of waste water emission monitoring. We also considered the requirements of environmental permits, water permits, water consents, and the environmental standard ISO 14001.
Our obligations in assessing impacts and risks related to water sources are also part of ensuring environmental compliance. The Slovenian Environment Agency has issued a comprehensive environmental permit for our production sites in Ločna and Krško, and an environmental permit for emissions to water for our production sites in Bršljin, Šentjernej, and Ljutomer. The Slovenian Water Agency has issued a water permit and water consent for the withdrawal of river and drinking water for technological purposes. For the two sites where chemical activities are carried out (Ločna, Krško), SEVESO studies were conducted and Krka submitted applications for obtaining SEVESO permits. At our production sites outside Slovenia (Croatia, Poland, the Russian Federation, Germany), we follow the requirements of national legislation regarding water consumption.
We have not yet conducted consultations with external stakeholders with regard to the identification of impacts, risks, and opportunities related to ESRS E3.
When assessing impacts, risks and opportunities related to biodiversity and ecosystems, we considered all the material activities and production sites within our own operations. We assessed that impacts related to the value chain mainly occur upstream. Production sites are key sites in terms of our own operations. We assessed actual and potential impacts on biodiversity and ecosystems based on ISO 14001 guidelines. We also considered our sustainability and environmental policies, which now cover biodiversity, along with our development strategy, sustainability goals, pharmaceutical industry insights, and product portfolio.
In identifying and determining the assessment of dependencies on biodiversity and ecosystems, we assessed whether the loss of biodiversity and ecosystem services could cause disruptions at our own site locations. We also assessed ecosystem services that are likely to be disrupted, in particular in terms of natural resources and climate change. We cannot exclude the indirect impact on Krka’s long-term supply of necessary natural resources due to the degradation of biodiversity and ecosystems, but based on available information, we do not consider it material. No data are available on dependencies on biodiversity, ecosystems, and their services in the upstream and downstream value chain. However, since key activities in the upstream value chain closely resemble those of Krka, we assess that the dependencies are largely similar.
We have not identified any transition and physical risks related to biodiversity and ecosystems. We have not identified any systemic risks due to the current lack of specific data and tools needed to accurately identify the impacts of our activities on biodiversity.
No specific sites have been identified where biodiversity impacts have caused or may cause negative effects on affected communities. Since we did not conduct consultations with affected communities regarding the sustainability assessment of shared biological resources and ecosystems, these communities were not included in the materiality assessments. We conduct different actions and activities identified in compliance with Disclosure Requirements of topical standards ESRS E1, E2, E3 and E5 to reduce the likelihood of occurrence of potential negative impacts on these communities.
In assessing impacts, risks and opportunities related to resource use and circular economy, we considered all activities and locations in our own operations and available information about the value chain. In terms of our own operations, we consider our production sites our key locations. We have focused on material resource inflows needed for our activities, resource outflows and waste generated in the process. We assumed that the business model of the value chain, particularly in its upstream part, is fairly similar and dependent on the same resource inflows, generating similar resource outflows and waste. This assumption is also based on our business model being highly vertically integrated, which results in significant similarities with the upstream value chain.
We have not yet consulted with external stakeholders regarding the identification of impacts, risks, and opportunities related to ESRS E5.
In assessing double materiality, we considered the Krka Group’s pharmaceutical activities along with its business activities and transactions. The foundations of IRO assessment were the current Integrity Plan and information available to the Chief Compliance Officer.
| General information | Required disclosure | Page | Additional information |
|---|---|---|---|
| ESRS 2 – GENERAL DISCLOSURES | BP-1 – General basis for preparation of sustainability statements | 137 | |
| BP-2 – Disclosures in relation to specific circumstances | 137 | ||
| Governance | GOV-1 – The role of the administrative, management and supervisory bodies | 140 | |
| GOV-2 – Information provided to and sustainability matters addressed by the undertaking’s administrative, management and supervisory bodies | 142 | ||
| GOV-3 – Integration of sustainability-related performance in incentive schemes | 143 | ||
| GOV-4 – Statement on due diligence | 144 | ||
| GOV-5 – Risk management and internal controls over sustainability reporting | 145 | ||
| Strategy | SBM-1 – Strategy, business model and value chain | 145 | |
| SBM-2 – Interests and views of stakeholders | 147 | ||
| SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and business model | 150 | ||
| Impact, risk and opportunity management | IRO-1 – Description of the processes to identify and assess material impacts, risks and opportunities | 161 | |
| IRO-2 – Disclosure requirements in ESRS covered by the undertaking’s sustainability statement | 166 |
| Required disclosure | Page | Additional information |
|---|---|---|
| ESRS E1 – CLIMATE CHANGE | ||
| Governance | GOV-3 – Integration of sustainability-related performance in incentive schemes | 143 |
| Strategy | E1-1 – Transition plan for climate change mitigation | 184 |
| ESRS 2 SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and business model | 150 | |
| Impact, risk and opportunity management | ESRS 2 IRO-1 – Description of the processes to identify and assess material climate-related impacts, risks and opportunities | 161 |
| E1-2 – Policies related to climate change mitigation and adaptation | 184 | |
| E1-3 – Actions and resources in relation to climate change policies | 185 | |
| E1-4 – Targets related to climate change mitigation and adaptation | 188 |
189
190
Non-material
Non-material
Phase-in of deferral period
167
Page
Additional information
161
195
196
197
198
Non-material
Phase-in of deferral period
Page
Additional information
161
198
199
201
201
Phase-in of deferral period
Page
Additional information
202
150
161
202
203
204
204
| ESRS 2 IRO-1 – Description of the processes to identify and assess material resource use and circular economy-related impacts, risks and opportunities | 161 |
|---|---|
| E5-1 – Policies related to resource use and circular economy | 204 |
| E5-2 – Actions and resources related to resource use and circular economy | 205 |
| E5-3 – Targets related to resource use and circular economy | 207 |
|---|---|
| E5-4 – Resource inflows | 208 |
| E5-5 – Resource outflows | 208 |
| E5-6 – Anticipated financial effects from resource use and circular economy-related impacts, risks and opportunities |
2024 Annual Report – Business report
168
| ESRS 2 SBM-2 – Interests and views of stakeholders | 147 |
|---|---|
| ESRS 2 SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and business model | 150 |
| S1-1 – Policies related to own workforce | 210 |
|---|---|
| S1-2 – Processes for engaging with own workers and workers’ representatives about impacts | 213 |
| S1-3 – Processes to remediate negative impacts and channels for own workers to raise concerns | 216 |
| S1-4 – Taking action on material impacts on own workforce, and approaches to mitigating material risks and pursuing material opportunities related to own workforce, and effectiveness of those actions | 217 |
| S1-5 – Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities | 220 |
|---|---|
| S1-6 – Characteristics of the undertaking’s employees | 222 |
| S1-7 – Characteristics of non-employee workers in the undertaking’s own workforce |
| S1-8 – Collective bargaining coverage and social dialogue | 224 |
|---|---|
| S1-9 – Diversity metrics | 224 |
| S1-10 – Adequate wages | 225 |
| S1-11 – Social protection | |
| S1-12 – Persons with disabilities | |
| S1-13 – Training and skills development metrics | |
| S1-14 – Health and safety metrics | 225 |
| S1-15 – Work-life balance metrics | |
| S1-16 – Compensation metrics (pay gap and total compensation) | 226 |
| S1-17 – Incidents, complaints and severe human rights impacts | 227 |
| ESRS 2 SBM-2 – Interests and views of stakeholders | |
|---|---|
| Benchmark | Regulation reference and EU Climate Law reference | Material/Non-material | Section (subsection) | Page | |
|---|---|---|---|---|---|
| ESRS 2 GOV-1 | Board’s gender diversity paragraph 21 (d) Indicator number 13 of Table #1 of Annex I Commission Delegated Regulation (EU) 2020/1816 (27), Annex II | material | GOV-1 – The role of the administrative, management and supervisory bodies | 140 | |
| ESRS 2 GOV-1 | Percentage of board members who are independent paragraph 21 (e) Delegated Regulation (EU) 2020/1816, Annex II | material | GOV-1 – The role of the administrative, management and supervisory bodies | 140 | |
| ESRS 2 GOV-4 | Statement on due diligence paragraph 30 Indicator number 10 of Table #3 of Annex I | material | GOV-4 – Statement on due diligence | 144 | |
| ESRS 2 SBM-1 | Involvement in activities related to fossil fuel activities paragraph 40 (d) i Indicator number 4 of Table #1 of Annex I Article 449a Regulation (EU) No 575/2013; | Commission Implementing Regulation (EU) 2022/2453 (6) Table 1: Qualitative information on Environmental risk and Table 2: Qualitative information on Social risk | non-material | |||
| ESRS 2 SBM-1 | Involvement in activities related to chemical production paragraph 40 (d) ii Indicator number 9 of Table #2 of Annex I | non-material | |||
| ESRS 2 SBM-1 | Involvement in activities related to controversial weapons paragraph 40 (d) iii Indicator number 14 of Table #1 of Annex I Delegated Regulation (EU) 2020/1818 (7), Article 12(1) | non-material |
Involvement in activities related to cultivation and production of tobacco paragraph 40 (d) iv
| Disclosure Requirement and related datapoint | SFDR reference | Pillar 3 reference | Benchmark Regulation reference and EU Climate Law reference | Material/Non-material | Section (subsection) | Page |
|---|---|---|---|---|---|---|
| ESRS E1-1 Transition plan to reach climate neutrality by 2050 paragraph 14 (4) | Regulation (EU) 2021/1119, Article 2(1) | material | E1-1 – Transition plan for climate change mitigation | 184 | ||
| ESRS E1-1 Undertakings excluded from Paris-aligned Benchmarks paragraph 16 (g) | Article 449a; Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 Template 1: Banking book – Climate change transition risk: Credit quality of exposures by sector, emissions and residual maturity | Delegated Regulation (EU) 2020/1818, Article 12.1 (d) to (g), and Article 12.2 | material | Sustainability goals (ESG goals) | 47 | |
| ESRS E1-4 GHG emission reduction targets paragraph 34 | Indicator number 4 of Table #2 of Annex I | Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 Template 3: Banking book – Climate change transition risk: alignment metrics | Delegated Regulation (EU) 2020/1818, Article 6 | material | E1-4 – Targets related to climate change mitigation and adaptation | 188 |
| ESRS E1-5 Energy consumption from fossil sources disaggregated by sources (only high climate impact sectors) paragraph 38 | Indicator number 5 of Table #1 and Indicator number 5 of Table #2 of Annex I | material | E1-5 – Energy |
Indicator number 5 of Table #1 of Annex I
Energy intensity associated with activities in high climate impact sectors paragraphs 40 to 43
Indicator number 6 of Table #1 of Annex I
Gross Scope 1, 2, 3 and Total GHG emissions paragraph 44
Indicators number 1 and 2 of Table #1 of Annex I
Article 449a; Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 Template 1: Banking book – Climate change transition risk: Credit quality of exposures by sector, emissions and residual maturity Delegated Regulation (EU) 2020/1818, Article 5(1), 6 and 8(1)
material
GHG emissions reported separately from Scope 1, 2 and 3 emissions
Gross GHG emissions intensity paragraphs 53 to 55
Indicator number 3 of Table #1 of Annex I
Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 Template 3: Banking book – Climate change transition risk: alignment metrics Delegated Regulation (EU) 2020/1818, Article 8(1)
material
GHG emissions reported separately from Scope 1, 2 and 3 emissions
GHG removals and carbon credits paragraph 56 (4) Regulation (EU) 2021/1119, Article 2(1)
non-material
| Disclosure Requirement and related datapoint | SFDR reference | Pillar 3 reference | Benchmark Regulation reference | and EU Climate Law reference | Material/Non-material | Section (subsection) | Page |
|---|---|---|---|---|---|---|---|
Exposure of the benchmark portfolio to climate-related physical risks paragraph 66
Delegated Regulation (EU) 2020/1818, Annex II; Delegated Regulation (EU) 2020/1816, Annex II
non-material, phase-in of deferral period
Disaggregation of monetary amounts by acute and chronic physical risk paragraph 66 (a)
Location of significant assets at material physical risk paragraph 66 (c)
Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 paragraphs 46 and 47; Template 5: Banking book - Climate change physical risk: Exposures subject to physical risk
non-material, phase-in of deferral period
Breakdown of the carrying value of its real estate assets by energy-efficiency classes paragraph 67 (c)
Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 paragraph 34; Template 2: Banking book - Climate change transition risk: Loans collateralised by immovable property - Energy efficiency of the collateral
non-material, phase-in of deferral period
Degree of exposure of the portfolio to climate-related opportunities paragraph 69
Delegated Regulation (EU) 2020/1818, Annex II
non-material, phase-in of deferral period
Amount of each pollutant listed in Annex II of the E-PRTR Regulation (European Pollutant Release and Transfer Register) emitted to air, water and soil, paragraph 28
Indicator number 8 of Table #1, Indicators number 1, 2 and 3 of Table #2 of Annex I
material
E2-4 – Pollution of air, water and soil
198
Water and marine resources paragraph 9
Indicator number 7 of Table #2 of Annex I
non-material
Sustainable oceans and seas paragraph 14
Indicator number 12 of Table #2 of Annex I
non-material
Total water recycled and reused paragraph 28 (c)
Indicator number 6.2 of Table #2 of Annex I
material
201
173
SFDR reference
Pillar 3 reference
| Material/Non-material | Section (subsection) | Page |
|---|---|---|
| material | ESRS E3-4 Total water consumption in m3 per net revenue on own operations paragraph 29 Indicator number 6.1 of Table #2 of Annex I | 201 |
| material | ESRS 2- IRO 1 - E4 paragraph 16 (a) i Indicator number 7 of Table #1 of Annex I | 202 |
| material | ESRS 2- IRO 1 - E4 paragraph 16 (b) Indicator number 10 of Table #2 of Annex I | 202 |
| material | ESRS 2- IRO 1 - E4 paragraph 16 (c) Indicator number 14 of Table #2 of Annex I | 202 |
| material | ESRS E4-2 Sustainable land / agriculture practices or policies paragraph 24 (b) Indicator number 11 of Table #2 of Annex I | 202 |
| non-material | ESRS E4-2 Sustainable oceans / seas practices or policies paragraph 24 (c) Indicator number 12 of Table #2 of Annex I | |
| non-material | ESRS E4-2 Policies to address deforestation paragraph 24 (d) Indicator number 15 of Table #2 of Annex I | |
| material | ESRS E5-5 Non-recycled waste paragraph 37 (d) Indicator number 13 of Table #2 of Annex I | 209 |
| material | ESRS E5-5 Hazardous waste and radioactive waste paragraph 39 Indicator number 9 of Table #1 of Annex I | 209 |
| ESRS 2- SBM3 - S1 Risk of incidents of forced labour paragraph 14 (f) Indicator number 13 of Table #3 of Annex I |
153
Indicator number 12 of Table #3 of Annex I
153
Indicator number 9 of Table #3 and Indicator number 11 of Table #1 of Annex I
210
174
| Disclosure Requirement and related datapoint | SFDR reference | Pillar 3 reference | Benchmark Regulation reference and EU Climate Law reference | Material/Non-material | Section (subsection) | Page |
|---|---|---|---|---|---|---|
| ESRS S1-1 Due diligence policies on issues addressed by the fundamental International Labor Organisation Conventions 1 to 8, paragraph 21 | Delegated Regulation (EU) 2020/1816, Annex II | material | S1-1 – Policies related to own workforce | 210 | ||
| ESRS S1-1 Processes and measures for preventing trafficking in human beings paragraph 22 | non-material | |||||
| ESRS S1-1 Workplace accident prevention policy or management system paragraph 23 | non-material | |||||
| ESRS S1-3 Grievance/complaints handling mechanisms paragraph 32 (c) | material | Complaints handling mechanisms and grievance mechanisms | 216 | |||
| ESRS S1-14 Number of fatalities and number and rate of work-related accidents paragraph 88 (b) and (c) | Indicator number 2 of Table #3 of Annex I | Delegated Regulation (EU) 2020/1816, Annex II |
| ESRS S1-14 | Number of days lost to injuries, accidents, fatalities or illness | paragraph 88 (e) | Indicator number 3 of Table #3 of Annex I |
|---|---|---|---|
| ESRS S1-16 | Unadjusted gender pay gap | paragraph 97 (a) | Indicator number 12 of Table #1 of Annex I | Delegated Regulation (EU) 2020/1816, Annex II |
|---|---|---|---|---|
| ESRS S1-16 | Excessive CEO pay ratio | paragraph 97 (b) | Indicator number 8 of Table #3 of Annex I |
| ESRS S1-17 | Incidents of discrimination | paragraph 103 (a) | Indicator number 7 of Table #3 of Annex I | |
|---|---|---|---|---|
| ESRS S1-17 | Non-respect of UNGPs on Business and Human Rights and OECD | paragraph 104 (a) | Indicator number 10 of Table #1 and Indicator number 14 of Table #3 of Annex I | Delegated Regulation (EU) 2020/1816, Annex II Delegated Regulation (EU) 2020/1818, Art 12 (1) |
227
Significant risk of child labour or forced labour in the value chain paragraph 11 (b)
Indicators number 12 and number 13 Table #3 of Annex I
150
Human rights policy commitments paragraph 17
Indicator number 9 of Table #3 and Indicator number 11 of Table #1 of Annex I
228
paragraph 18, Indicator number 11 and number 4 of Table #3 of Annex I
228
paragraph 19
Indicator number 10 of Table #1 of Annex I
228
paragraph 19
228
paragraph 36
Indicator number 14 of Table #3 of Annex I
229
176
| Benchmark | Regulation reference and EU Climate Law reference | Material/Non-material | Section (subsection) | Page |
|---|---|---|---|---|
| ESRS S3-1 | Human rights policy commitments paragraph 16 Indicator number 9 of Table #3 of Annex I and Indicator number 11 of Table #1 of Annex I | non-material | ||
| ESRS S3-1 | Non-respect of UNGPs on Business and Human Rights, ILO principles or and OECD guidelines paragraph 17 Indicator number 10 of Table #3 of Annex I | non-material | Delegated Regulation (EU) 2020/1816, Annex II Delegated Regulation (EU) 2020/1818, Art 12 (1) | |
| ESRS S3-4 | Human rights issues and incidents paragraph 36 Indicator number 14 of Table #3 of Annex I | non-material | ||
| ESRS S4-1 | Policies related to consumers and end-users paragraph 16 Indicator number 9 of Table #3 and Indicator number 11 of Table #1 of Annex I | material | S4-1 – Policies related to consumers and end-users | 230 |
| ESRS S4-1 | Non-respect of UNGPs on Business and Human Rights and OECD guidelines paragraph 17 Indicator number 10 of Table #1 of Annex I | material | Delegated Regulation (EU) 2020/1816, Annex II Delegated Regulation (EU) 2020/1818, Art 12 (1) | |
| Commitments in Krka policies on human rights relevant to consumers and end-users | material | 232 | ||
| ESRS S4-4 | Human rights issues and incidents paragraph 35 Indicator number 14 of Table #3 of Annex I | material | S4-4 – Taking action on material impacts | 237 |
| ESRS G1-1 | United Nations Convention against Corruption paragraph 10 (b), Indicator number 15 of Table #3 of Annex I | material | 1 – Management of relationships with suppliers | 245 |
EU Taxonomy Regulation (EU) 2020/852 of 18 June 2020 (hereinafter the Taxonomy Regulation) sets the classification system for environmentally sustainable economic activities and is an important step towards achieving climate neutrality in line with the EU’s climate objectives by 2050. This is to be achieved by increasing investments in projects and activities necessary for reaching the objectives of the European Green Deal. The EU Taxonomy helps investors identify environmentally sustainable economic activities, promotes the transition to a carbon-neutral future, and directs financing towards solutions that address the climate crisis and prevent further environmental degradation. In assessing the taxonomy-aligned activities of the Krka Group, we have considered all relevant legal provisions outlined below.
An economic activity is considered environmentally sustainable if it significantly contributes to one or more environmental objectives under Article 9 of the Taxonomy Regulation, in accordance with Articles 10 to 16; does not significantly harm any of the environmental objectives under Article 9 of the Taxonomy Regulation, as specified in Article 17; is conducted in compliance with the minimum safeguards set out in Article 18 of the Taxonomy Regulation; and meets the technical screening criteria established under Article 19, as defined by the European Commission under Articles 10(3), 11(3), 12(2), 13(2), 14(2) or 15(2) of the Taxonomy Regulation.
A taxonomy-eligible economic activity refers to an activity described in the delegated acts adopted under Articles 10(3), 11(3), 12(2), 13(2), 14(2) and 15(2) of the Taxonomy Regulation, regardless of whether it meets any or all of the technical screening criteria set out in these delegated acts. An economic activity is taxonomy-aligned if it meets the criteria for making a substantial contribution to environmental objectives and complies with the technical screening criteria outlined in the Commission Delegated Regulation (EU) 2021/2139 of 4 June 2021, Commission Delegated Regulation 2022/1214 of 9 March 2022, Commission Delegated Regulation (EU) 2023/2485, and Commission Delegated Regulation (EU) 2023/2486 of 27 June 2023, annexes to the Taxonomy Regulation and the delegated regulations. Additionally, the activity must meet the ‘do no significant harm’ criteria and must be implemented in compliance with the minimal safeguards for human and consumer rights, fight against corruption and bribery, tax provisions, and fair competition. A non-taxonomy-eligible economic activity is one that is not described in the delegated acts adopted under Articles 10(3), 11(3), 12(2), 13(2), 14(2) and 15(2) of the Taxonomy Regulation.
To effectively monitor economic activities aligned with the EU Taxonomy (hereinafter referred to as Taxonomy), we established an interdisciplinary working group within the Krka Group in 2023. This group consists of experts in environmental protection, engineering, technical services, energy, transport, corporate economics and finance, as well as representatives from Terme Krka. Together, we analysed economic activities contributing to the achievement of any of the six environmental objectives of the Taxonomy. These activities were compared with the economic activities of Krka and the Krka Group, taking into account the criteria for environmentally sustainable activities set out in Articles 3 and 10 to 18 of the Taxonomy Regulation, as well as the technical screening criteria.
When determining whether an economic activity is aligned with the Taxonomy, the first condition set out in the Taxonomy Regulation must be verified – namely, whether the activity makes a substantial contribution to one or more environmental objectives. We have determined that our activities make a significant contribution to achieving the following five environmental objectives of the Taxonomy Regulation:
Based on the review, we identified several environmentally sustainable activities within the Krka Group that are currently Taxonomy-eligible, as they do not yet fully meet all of the ‘do no significant harm’ criteria and technical screening criteria to be classified as taxonomy-aligned. Additionally, the Krka Group has not yet conducted a detailed assessment of climate risks and vulnerabilities for the identified physical climate risks and their impact on the performance of economic activities in line with Appendix A to the technical screening criteria. We plan to conduct this assessment in 2025.
Within this environmental objective, we have generated revenue from electricity generation using solar photovoltaic technology (Taxonomy activity 4.1) and from the collection and transport of non-hazardous waste in source segregated fractions (Taxonomy activity 5.5). Revenue related to electricity production from the photovoltaic power plant is generated through direct payments from the Energy Agency, which promotes the installation of such systems through this scheme. The annual support for the current system will expire in the first quarter of 2026. By separating non-hazardous waste fractions, we provide raw materials for other activities and reduce the use of primary resources, while the photovoltaic power plant contributes to reducing GHG emissions. These are Krka’s accompanying activities. We do not anticipate an increase in revenue from these activities in the future.
In 2024, the largest proportion of CapEx was allocated for the construction of new buildings and the energy renovation of existing ones. We applied state-of-the-art standards and energy efficiency requirements in the construction process. With regard to OpEx, the largest proportion of funds was allocated to the maintenance of buildings, the collection and transport of non-hazardous and hazardous waste, and the provision of high-efficiency waste water treatment. A smaller proportion of OpEx was allocated to other supporting activities, for which funds were planned as part of regular system maintenance. We do not plan a significant increase in investments in OpEx as most system upgrades fall under CapEx.
In accordance with Article 8 of the Taxonomy Regulation and amended Regulation (EU) 2019/2088, the Krka Group discloses information and key performance indicators (KPIs) on how and to what extent the economic activities of Krka and the Krka Group are considered environmentally sustainable economic activities. The disclosure of information is in accordance with Commission Delegated Regulation (EU) 2021/2178 of 6 July 2021 (hereinafter the Disclosures Regulation) and its amendments, as well as the technical screening criteria for determining the conditions under which an economic activity is considered to make a substantial contribution to any of the six environmental objectives and assessing whether this economic activity does not cause significant harm to any of the other environmental objectives.
We based the disclosures on the examination of the said Taxonomy documents, our current understanding of the matter, and available data. We have continuously strived to improve the reporting system to ensure comprehensive disclosures in accordance with the Disclosures Regulation and its amendments. KPIs related to turnover, capital expenditure (CapEx), and operating expenditure (OpEx) are calculated and presented in indicator tables as required by the Disclosures Regulation and its amendments. Compared to the previous year, there have been no significant changes in the identified taxonomy-eligible activities.
Turnover, CapEx and OpEx KPIs are calculated based on the definitions in Annex I to the Disclosures Regulation and its amendments. We have identified only taxonomy-eligible activities. This is why we allocated the corresponding revenues, investments, and expenses to Taxonomy-aligned activities (A2). Each activity was assigned to only one environmental objective in accordance with the technical criteria. To avoid double counting when calculating turnover, CapEx and OpEx KPIs, we divided the denominator (base) of each calculated indicator numerator between the taxonomy-eligible and taxonomy-non-eligible activities.
In 2024, the Krka Group’s operating income, which serves as the basis for the calculation of the turnover KPI, amounted to €1,911,829 thousand. It included revenue and profit from the sale of property, plant and equipment within other operating income. Operating income is presented in the ‘Financial report’ under ‘Notes to the consolidated financial statements’ (‘4. Revenue from contracts with customers’ and ‘5. Other operating income’).
Operating income associated with Taxonomy-eligible economic activities totalled €1,906,368 thousand, or 99.71% of total operating income. Operating income associated with activities that are not Taxonomy-eligible amounted to €5,461 thousand, or 0.29% of total operating income. The largest proportion of income associated with Taxonomy-eligible activities was generated by Manufacture of medicinal products (1.2), amounting to €1,856,687 thousand, or 97.12% of total income of the Krka Group. This was followed by hotels, holiday, camping grounds and similar accommodation (2.1), which contributed €31,215 thousand in taxonomy-eligible income, or 1.63% of total income of the Krka Group, and residential care activities (12.1), which contributed €18,135 thousand in taxonomy-eligible income, or 0.95% of total income of the Krka Group. In 2024, there were no significant differences in the KPI compared to the previous year.
Krka Group investments are the basis for the calculation of CapEx performance indicator. In 2024, they totalled €122,873 thousand. They included acquisition of property, plant and equipment, right-of-use assets, and acquisition of intangible assets. They are disclosed in the ‘Financial report’ under ‘Notes to the consolidated financial statements’ (‘11. Property, plant and equipment’ and ‘12. Intangible assets’).
CapEx in Taxonomy-eligible activities amounted to €97,833 thousand or 79.62% of the Krka Group CapEx in 2024. CapEx in Taxonomy non-eligible activities totalled €25,040 thousand or 20.38% of the Krka Group CapEx in 2024. The largest proportion of investments in Taxonomy-eligible activities was in Manufacture of medicinal products (1.2), specifically €54,850 thousand or 44.64% of the Krka Group CapEx. Investments in Renovation of existing buildings (7.2) amounted to €12,912 thousand or 10.51% of investments, while investments in Data processing, hosting and related activities (8.1) totalled €12,422 thousand or 10.11% of the Krka Group CapEx.
The Krka Group has not established specific CapEx plans that would directly contribute to a higher share of Taxonomy-eligible or -aligned activities. By investing in Taxonomy-eligible activities, we strive to reduce energy consumption for heating premises, increase energy efficiency, reduce transport emissions, redirect waste towards reuse, recycling, and energy recovery, ensure high-efficiency waste water treatment and watercourse quality, and reduce GHG emissions, climate risks, and the impact of production on all environmental segments. In the coming years, we will strive to improve all three performance indicators, both in terms of taxonomy eligibility and taxonomy alignment. We carefully plan all activities, especially investment projects, and consider environmental aspects from the outset. We aim to minimise our impact on the natural environment by using the best available technologies and equipment. In 2024, the KPI is slightly higher compared to the previous year. The differences primarily stem from higher CapEx allocated for Construction, extension and operation of waste water collection and treatment (Taxonomy activity 5.3) and Renovation of existing buildings (Taxonomy activity 7.2), and slightly lower CapEx allocated for Construction of new buildings (Taxonomy activity 7.1).
OpEx, which include the costs of development, reduced by the costs of depreciation, as well as maintenance costs and rental expenses under other business functions, amounted to €213,010 thousand in the Krka Group in 2024. OpEx are disclosed in the ‘Financial report’ under ‘Notes to the consolidated financial statements’ (‘6. Costs by nature’).
OpEx in Taxonomy-eligible activities totalled €34,661 thousand or 16.27% of the Krka Group OpEx. OpEx in Taxonomy non-eligible activities totalled €178,349 thousand or 83.73% of the Krka Group OpEx. The largest share of OpEx in Taxonomy-eligible activities was in Manufacture of medicinal products (1.2), specifically €18,550 thousand or 8.71% of the Krka Group OpEx. This was followed by investments in Renovation of existing buildings (7.2), totalling at €5,382 thousand or 2.53% of OpEx, and investments in Collection and transport of non-hazardous and hazardous waste (2.3), amounting to €4,702 thousand or 2.21% of the Krka Group OpEx. In 2024, there were no significant differences in the KPI compared to the previous year.
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| Proportion of Taxonomy-aligned (A.1.) or -eligible (A.2.) turnover, year 2023 | Category (enabling activity) | Category (transitional activity) | € thousand | % | YES; NO; N/EL | YES; NO; N/EL | YES; NO; N/EL | YES; NO; N/EL | YES; NO; N/EL | YES; NO; N/EL | Y/N | Y/N | Y/N | Y/N | Y/N | Y/N | |
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| A. TAXONOMY-ELIGIBLE ACTIVITIES | A.1. Environmentally sustainable activities (Taxonomy-aligned) | Turnover of environmentally sustainable activities (Taxonomy-aligned) (A.1) | 0.00 | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | / | / | / | / | / | / |
| Of which enabling | 0.00 | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | / | / | / |
| Activity | Code | Value | Percentage | EL | N/EL |
|---|---|---|---|---|---|
| Electricity generation using solar photovoltaic technology | 4.1 | 17 | 0.001% | EL | N/EL |
| Residential care activities | 12.1 | 18,135 | 0.95% | N/EL | EL |
| Collection and transport of non-hazardous waste in source segregated fractions | 5.5 | 314 | 0.02% | N/EL | EL |
| Manufacture of medicinal products | 1.2 | 1,856,687 | 97.12% | N/EL | EL |
| Hotels, holiday, camping grounds and similar accommodation | 2.1 | 31,215 | 1.63% | N/EL | EL |
| Turnover of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) | 1,906,368 | 1.63% | ||
|---|---|---|---|---|
| A. Turnover of Taxonomy-eligible activities (A.1+A.2) | 1,906,368 | 99.71% | ||
| B. TAXONOMY-NON-ELIGIBLE ACTIVITIES | Turnover of Taxonomy-non-eligible activities | 5,461 | 0.29% | |
| Total | 1,911,829 | 100.00% |
| Economic activities | Code | CapEx | Proportion of CapEx | Climate change mitigation | Climate change adaptation | Water and marine resources | Circular Economy | Pollution | Biodiversity and ecosystems |
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| Proportion of Taxonomy-aligned (A.1.) or -eligible (A.2.) CapEx, year 2023 | Category (enabling activity) | Category (transitional activity) | € thousand | % | YES; NO; N/EL | YES; NO; N/EL | YES; NO; N/EL | YES; NO; N/EL | YES; NO; N/EL | YES; NO; N/EL | Y/N | Y/N | Y/N | Y/N | Y/N | Y/N |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| A. TAXONOMY-ELIGIBLE ACTIVITIES | A.1. Environmentally sustainable activities (Taxonomy-aligned) | CapEx of environmentally sustainable activities (Taxonomy-aligned) (A.1) | 0.00 | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | / | / | / | / | / | / |
| – Of which enabling | 0.00 | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | / | / | / | / | / | / | |||
| – Of which transitional | 0.00 | 0.00% | 0.00% | / | / | / | / | / | / | / | / | / | / |
| Activity | Code | Value | Percentage | EL | N/EL | N/EL | N/EL | N/EL | N/EL | Percentage |
|---|---|---|---|---|---|---|---|---|---|---|
| District heating/cooling distribution | 4.15 | 308 | 0.25% | EL | N/EL | N/EL | N/EL | N/EL | N/EL | 0.20% |
| Installation and operation of electric heat pumps | 4.16 | 873 | 0.71% | EL | N/EL | N/EL | N/EL | N/EL | N/EL | 0.19% |
| Production of heat/cool from fossil gaseous fuels in an efficient district heating and cooling system | 4.31 | 498 | 0.41% | EL | N/EL | N/EL | N/EL | N/EL | N/EL | 0.18% |
| Construction, extension and operation of water collection, treatment and supply systems | 5.1 | 1,985 | 1.62% | EL | N/EL | N/EL | N/EL | N/EL | N/EL | 0.01% |
| Construction, extension and operation of waste water collection and treatment | 5.3 | 8,808 | 7.17% | EL | N/EL | N/EL | N/EL | N/EL | N/EL | 0.57% |
| Renewal of waste water collection and treatment | 5.4 | / | / | EL | N/EL | N/EL | N/EL | N/EL | N/EL | 0.91% |
| Freight transport services by road | 6.6 | / | / |
| 6.13 | / | / |
|---|---|---|
| 7.1 | 5,177 | 4.21% |
|---|---|---|
| 7.2 | 12,912 | 10.51% |
|---|---|---|
| 7.4 | / | / |
|---|---|---|
| 8.1 | 12,422 | 10.11% |
|---|---|---|
| 1.2 | 54,850 | 44.64% |
|---|---|---|
| 97,833 | 38.03% | |
|---|---|---|
| A. CapEx of Taxonomy-eligible activities (A.1+A.2) | 97,833 | 79.62% | 34.98% | 0.00% | 0.00% | 0.00% | 44.64% | 0.00% | 64.79% |
|---|---|---|---|---|---|---|---|---|---|
| B. TAXONOMY-NON-ELIGIBLE ACTIVITIES | CapEx of Taxonomy-non-eligible activities | 25,040 | 20.38% | ||||||
| Total | 122,873 | 100.00% |
| Economic activities | Code | OpEx | Proportion of OpEx | Climate change mitigation | Climate change adaptation | Water and marine resources | Circular Economy | Pollution | Biodiversity and ecosystems |
|---|---|---|---|---|---|---|---|---|---|
| Minimum safeguards | |||||||||
| Proportion of Taxonomy-aligned (A.1.) or -eligible |
| Category (enabling activity) | Category (transitional activity) | € thousand | % | YES; NO; N/EL | YES; NO; N/EL | YES; NO; N/EL | YES; NO; N/EL | YES; NO; N/EL | YES; NO; N/EL | Y/N | Y/N | Y/N | Y/N | Y/N | Y/N | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| A. TAXONOMY-ELIGIBLE ACTIVITIES | A.1. Environmentally sustainable activities (Taxonomy-aligned) | OpEx of environmentally sustainable activities (Taxonomy-aligned) (A.1) | 0.00 | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | / | / | / | / | / | / |
| – Of which enabling | 0.00 | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | / | / | / | / | / | 0.00% | ||||
| – Of which transitional | 0.00 | 0.00% | 0.00% | / | / | / | / | / | / | 0.00% | ||||||
| A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) | Electricity generation using solar |
| Transmission and distribution of electricity | 4.9 | 700 | 0.33% |
|---|---|---|---|
| District heating/cooling distribution | 4.15 | 519 | 0.24% |
| Production of heat/cool using waste heat | 4.25 | 60 | 0.03% |
| Production of heat/cool from fossil gaseous fuels in an efficient district heating and cooling system | 4.31 | 1,646 | 0.77% |
| Construction, extension and operation of waste water collection and treatment | 5.3 | 3,102 | 1.46% |
| Renovation of existing buildings | 7.2 | 5,382 | 2.53% |
| Collection and transport of non-hazardous and hazardous waste |
| 4,702 | 2.21% | N/EL | N/EL | N/EL | EL | N/EL | N/EL | ||
|---|---|---|---|---|---|---|---|---|---|
| 1.2 | 18,550 | 8.71% | N/EL | N/EL | N/EL | N/EL | EL | ||
| OpEx of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) | 34,661 | 16.27% | 5.36% | 0.00% | 0.00% | 2.21% | 8.71% | 0.00% | 15.60% |
| A. OpEx of Taxonomy-eligible activities (A.1+A.2) | 34,661 | 16.27% | 5.36% | 0.00% | 0.00% | 2.21% | 8.71% | 0.00% | 15.60% |
| B. TAXONOMY-NON-ELIGIBLE ACTIVITIES | OpEx of Taxonomy-non-eligible activities | 178,349 | 83.73% | ||||||
| Total | 213,010 | 100.00% |
The Krka Group currently lacks a transition plan for climate change mitigation. However, we anticipate developing one no later than by the transposition of Directive (EU) 2024/1760 on corporate sustainability due diligence (CS3D Directive) into Slovenian law (and entry into force for the Krka Group).
Managing material impacts, risks, and opportunities related to climate change mitigation is part of broader environmental policies and governance approaches. The most important of these is the Environmental Policy of the Krka Group.
The Environmental Policy of the Krka Group applies to all aspects of our operations and commits both the management and all employees to sustainable business practices and environmental preservation, reducing the environmental impacts of our activities throughout the entire product life cycle, ensuring a healthy living environment to employees and the wider community, and contributing to global environmental goals.
The Policy specifies Krka’s dedication to reducing the impact of our activities on climate change, efficient use of resources and circular economy, prevention and minimisation of environmental pollution, proper waste management, biodiversity conservation and ecosystem protection, and care for natural water resources. It also defines our commitment to sustainability, stakeholder engagement, and upgrading the value chain due diligence to identify, prevent and mitigate negative environmental impacts and manage opportunities and risks related to climate change. The Policy has no explicit reference to climate change adaptation principles.
relates to all material impacts, risks and opportunities identified under ESRS E1, E2, E3, E4 and E5 standards and defined in ESRS 2SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and business model. Krka’s Management Board is tasked with implementing the Policy. Krka Group key stakeholders were not directly engaged in formulating the Policy.
specifies guidelines and actions related to climate change, aimed at mitigating material negative impacts, advancing positive impacts, addressing risks and promoting opportunities associated with climate change. Efficient energy use and reduction of air emissions are our priorities. Programmes adopted based on the Policy contribute to climate change mitigation.
The Environmental Policy of the Krka Group aligns with the following principles related to climate change adaptation and mitigation:
The above-mentioned actions and activities apply to our own operations. Outside the Krka Group, we promote the environmental policy principles by encouraging the relevant actors to implement the Code of Conduct for Business Partners of the Krka Group, which addresses, among others, air emissions and efficient use of energy.
The relationships between the Environmental Policy of the Krka Group and other material environmental impacts, risks and opportunities are also presented in E2-1 – Policies related to pollution, E3-1 – Policies related to water and marine resources, E4-2 – Policies related to biodiversity and ecosystems, and E5-1 – Policies related to resource use and circular economy.
Due to the complexity, continuous changes in the regulatory and business landscape, and the importance of this area for the Krka Group, we systematically and regularly monitor the implementation and relevance of the Policy. The Policy is drafted, reviewed annually, and updated as needed, by a task group for the natural environment appointed by the Management Board. The Quality Committee and the Committee for Monitoring Environmental Aspects review the compliance and effectiveness of the adopted policy once a year.
The action set related to climate change mitigation includes ongoing actions, actions taken in 2024, and planned actions. No special climate change adaptation actions were implemented in 2024, nor are any planned for 2025.
We implement climate change mitigation actions within our environmental management system (EMS), which is aligned with the ISO 14001 standard. In doing so, we systematically manage environmental protection matters and reduce our environmental impacts. We transfer our guidelines and good practices to all subsidiaries through ongoing collaboration, information exchange, and investments.
We collect and analyse data about the environmental management system and verification of compliance of Krka’s activities with environmental legislation, environmental protection permits, and the ISO 14001 standard through various methodological tools. We leverage available resources, including monitoring environmental emissions, outcomes for our processes or activities with material environmental impact, findings of self-inspections and audits, internal audits, security checks, inspections, customer claims, and risk analyses. They confirm the system’s suitability and efficiency and highlight improvement opportunities. We report environmental data to our management, responsible committees, and national authorities, for example, the Slovenian Environment Agency (reports on environmental emissions monitoring), the Association of Chemical Industries at the Chamber of Commerce and Industry of Slovenia (Responsible Care Reports – RC), and other stakeholders.
The Committee for Monitoring Environmental Aspects prepares draft environmental programmes for the Krka Group each year. The Management Board approves the draft and allocates sufficient financial, human and organisational resources to the programmes. The annual programme sets out targets for environmental protection activities with a direct impact on climate change mitigation, geared towards efficiently and appropriately managing climate change mitigation, and the related impacts, risks, and opportunities.
These actions also include ongoing actions, that are aligned with the principles set out in the Environmental Policy of the Krka Group, in particular, in its section on reducing the impact of our activities on climate change. These actions form part of our long-term environmental management system, which is systematically and precisely defined in our internal standard operating procedure (SOP) Environmental Management System. Our activities in these matters comply with statutory requirements, requirements specified in environmental protection permits, and other obligations we have committed to fulfilling.
Energy management strategy and actions are part of our quality management system. They are also integrated in our development strategy. The system comprises various activities and actions for achieving cost-related and environmental objectives. The Committee for Monitoring Environmental Aspects is responsible for periodically identifying energy-related aspects under ISO 14001, internal rules, and policies. The energy management control system serves as the primary information tool to support the energy management system, complementing the computer system for monitoring and control. We pay special attention to energy efficiency to improve specific energy use.
The Krka Group monitors energy efficiency through the energy management control system that covers 18 key high energy consumption points and over 2,500 measurement points. This system enables us to monitor various indicators for evaluating energy efficiency. We recently introduced advanced AI-driven numerical models that allow us to monitor natural resource consumption in relation to various parameters. This advanced technological solution provides for easy control over production and process efficiency, as well as the consumption of heating, cooling, power sources, and other sources within a large system. It enables energy efficiency screening for individual processes, allowing for a faster response to unexpected changes.
Regular monitoring of the preparation and consumption of heating, cooling and power sources, along with periodic meetings with key energy operators and employees tasked with operating the systems enables us to continuously enhance energy efficiency and optimise the use of natural resources. We assess the efficiency of adopted actions by reviewing the minutes of the periodic meetings. We optimise existing systems and actively participate in designing new ones, incorporating the best available techniques to enhance energy efficiency.
Employees regularly receive information about potential energy-saving actions through our in-house magazines and other communication channels. The information is tailored to the specific requirements of each workplace. We send targeted notices to raise awareness about possible energy savings in heating and cooling, especially before the summer and winter seasons. We encourage employees to switch off appliances and energy systems at their workplaces when absent for extended periods. All notices and scientific articles are published on our internal website and are accessible to all Krka Group employees.
We develop and manufacture innovative generic products, aiming to reduce the impact of our operations on climate change. Single-pill combinations incorporating two or more active ingredients account for an increasing share of total Krka Group sales. They are important because of their major positive social impact related to drug effectiveness and their environmental contribution to reducing environmental load. Production of single-pill combinations generates energy and energy source savings, raw material and packaging savings and GHG emission savings compared to the production of single active ingredient medicines. It also reduces transportation needs, lowers logistics costs, and enhances our contribution to climate change mitigation while reinforcing the impact of other actions within our environmental policy.
Our climate change mitigation action programme outlined different programmes for 2024, including energy-related programmes (energy and fuel use), programmes for enhancing waste heat recovery and reducing natural resource use, and air emission reduction programmes.
We use waste heat as a by-product from various processes, e.g. at the compressor station, from flue gases from steam boilers, vapours from the steam boiler system, and condensed heat from the cooling unit and cogeneration, to prepare heating water.
In 2024, we launched a project to utilise waste heat from waste water at our industrial waste water treatment plant. Leveraging our in-house expertise and the experience of our equipment suppliers, we implemented a technological solution that raises waste water temperature using a heat pump. This innovation reduces our reliance on fossil fuels, contributing to the decarbonisation of industrial steam and heat energy generation. The system integrates necessary measuring devices, which exploit AI-driven energy management control system features to evaluate performance in real time. Certain consumers within the steam boiler system were integrated into the hot water system, enabling them to operate during the lowest heat energy demand periods. The system became operational in April 2024.
In 2024, we upgraded the energy monitoring and targeting system at our production plants in the Russian Federation and Poland. We identified the needs to set up additional measuring points, allowing us to comprehensively monitor the efficiency of heating, cooling and power source preparation and consumption. Efficiency monitoring will be upgraded by introducing regular periodic meetings with energy operators at production sites abroad.
We conducted a comprehensive energy audit at Terme Šmarješke Toplice, a part of our Terme Krka subsidiary, to verify the effectiveness of the recently implemented action and formulate proposals for new solutions in the future. An external provider conducted the energy review, as mandated by the Slovenian Energy Efficiency Act (ZURE), and provided analyses and a final report, which we will take into account in our corporate decision-making.
We re-inspected and upgraded the tower feed water regulation systems of the central cooling system at the Ločna site (Slovenia) in 2024. Following a review of the permissible operational parameters of the cooling units, we collaborated with manufacturers to update the regulating thresholds for their operation. Lowering the tower feed water temperature during the winter and transitional seasons resulted in a favourable specific electricity use per unit of generated cooling energy. We used these findings as an example of good practice in other systems for preparing cold glycol mixtures.
The Management Board approved programmes and related actions for 2025 related to air emissions, use of electricity and fuel, and transport.
Activities set out in the action plan are integrated into the strategic planning of investment projects, which Krka will deliver by employing its own financial assets and human resources.
We implement the actions in our own operations. The Code of Conduct for Business Partners of the Krka Group also includes these actions, encouraging stakeholders along our value chain to implement them.
In accordance with Commission Delegated Regulation (EU) 2021/2178, Krka Group’s capital expenditure related to climate change mitigation activities totalled €42,983 thousand, while operating expenditure associated with climate change mitigation activities amounted to €11,409 thousand in 2024. Key performance indicators are disclosed in more detail at the beginning of the ‘Environmental information’ section, ‘EU Taxonomy’ in line with Article 8 of Regulation (EU) 2020/852.
Targets and metrics to measure the effectiveness of actions related to managing material climate change-related impacts, risks and opportunities are presented in the table. Krka’s Supervisory and Management Boards adopted them, and they were integrated into the 2024–2028 Krka Group Development Strategy. Stakeholders have not been directly involved in individual target setting. All targets concern the company’s own operations and do not extend to the value chain.
Decarbonisation targets are not science-based (SBTi). The results in attaining the targets have not been verified by an independent external body. Progress in achieving the targets is monitored by the Committee for Monitoring Environmental Aspects, the Quality Committee, and the Sustainability Committee.
| Indicator | Up to 2028 target | 2024 |
|---|---|---|
| Specific use of energy (TJ/billion units) | <80 | 78.1 |
| Scope 1 and 2 carbon footprint reduction compared to the base year 2019 (market-based method) | –48%* | –48.4% |
Specific use of energy is an indicator calculated as a ratio of Krka Group total energy consumption (less energy consumption by Terme Krka, Krka’s health resort and tourist services subsidiary) to the number of units of pharmaceutical products manufactured in-house and at contractual production capacities. Achieving the target enhances energy efficiency, reduces costs, and minimises negative environmental impacts of GHG emissions from production and energy consumption, contributing to climate change mitigation.
Carbon footprint was calculated in compliance with the ISO 14064-1:2018 standard. The year 2019 was set as the base year because we calculated Scope 1 and 2 GHG emissions for the Krka Group for the first time in 2019. The target applies up to 2030. Scope 1 and 2 GHG emission calculations for 2019 were not subject to an audit or auditor’s assurance. The 2024 result indicates the relative reduction of total Scope 1 and 2 GHG emissions against the base year 2019, using the market-based method. The target applies to the sum of Scope 1 and 2 GHG emissions, rather than to Scope 1 and Scope 2 GHG emissions separately (the contribution of Scope 1 GHG emissions and Scope 2 GHG emissions to the reduction is not assessed separately). GHG emission reduction targets are expressed in gross terms, meaning they do not account for GHG removals, carbon credits, or avoided emissions. The sum of GHG emissions includes carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFC), perfluorocarbons (PFC), sulphur hexafluoride (SF6), and nitrogen trifluoride (NF3). All GHG emission reduction targets are measured and monitored using a uniform methodology, utilised in all company’s operative units in line with the ISO 14064-1:2018 standard and ESRS E1-6 – Gross Scopes 1, 2, 3 and Total GHG emissions. All justifications state that we monitor progress at sites under our operational control and that we monitor Scope 1 and 2 operational thresholds. The current result indicates that Scope 1 and 2 GHG emissions in 2024 were reduced by more than planned compared to the base year 2019. However, the final result may change because the target setting took into account the anticipated growth and production volume growth at all our sites by 2030. Achieving the target helps to reduce negative impacts of GHG emissions from Krka Group operations (direct Scope 1 GHG emissions and indirect Scope 2 GHG emissions). We formulated an action plan to achieve the target. The target to reduce the carbon footprint by 2030 factors in accelerated fleet electrification, business process optimisation, and energy efficiency improvements. However, the target is not aligned with the Paris Agreement and is not science-based (SBTi).
| Energy Source | 2024 (MWh) | Comparative, 2023 |
|---|---|---|
| Fuel consumption from coal and coal products | 0 | / |
| Fuel consumption from crude oil and petroleum products | 55,867 | / |
| Fuel consumption from natural gas | 204,197 | / |
| Fuel consumption from other fossil sources | 1,710 | / |
| (5) Consumption of purchased or acquired electricity, heat, steam, and cooling from fossil sources (MWh) | / | 45,553 |
|---|---|---|
| (6) Total fossil energy consumption (MWh) (calculated as the sum of lines 1 to 5) | / | 307,326 |
| Share of fossil sources in total energy consumption (%) | / | 72.24 |
| (7) Consumption from nuclear sources (MWh) | / | 117,367 |
| Share of consumption from nuclear sources in total energy consumption (%) | / | 27.59 |
| (8) Fuel consumption for renewable sources, including biomass (also comprising industrial and municipal waste of biologic origin, biogas, renewable hydrogen, etc.) (MWh) | / | 0 |
| (9) Consumption of purchased or acquired electricity, heat, steam, and cooling from renewable sources (MWh) | / | 720 |
| (10) Consumption of self-generated non-fuel renewable energy (MWh) | / | 0 |
| (11) Total renewable energy consumption (MWh) (calculated as the sum of lines 8 to 10) | / | 720 |
| Share of renewable sources in total energy consumption (%) | / | 0.17 |
| Total energy consumption (MWh) (calculated as the sum of lines 6 and 11) | / | 425,413 |
Data on energy consumption and mix are presented for the first time for 2024. Krka Group energy consumption and mix data were obtained from internal information systems for monitoring energy costs and energy consumption (SAP, ENIS) and from the electricity distributor’s portal (Moj elektro). The data were collected separately for the controlling company, subsidiaries and representative offices abroad, production plants abroad, and our subsidiary Terme Krka. Amounts of consumed purchased or acquired electricity, steam, heat or cooling from fossil sources in subsidiaries and representative offices abroad (excluding production plants abroad, where data are obtained directly) are estimated based on the number of employees in the subsidiaries and representative offices and the assumption that each administrative employee consumes 1.96 MWh of electricity, 1.58 MWh of heat, and 0.01 MWh of natural gas a year. The annual consumption factors per employee were determined based on a representative administrative building locations of Krka in Slovenia and the number of employees working in the buildings under consideration. The metrics have not been verified by an independent external body.
| Indicator | 2024 |
|---|---|
| Total energy consumption per net revenue (MWh/net revenue) | 220.3 |
The Krka Group’s primary activity falls within the high climate impact sector. Its economic activity is classified under NACE 21.20 – Manufacture of pharmaceutical preparations. Accordingly, the specific energy consumption indicator is related to net revenue from its business activity. Therefore, energy consumption of Terme Krka, our subsidiary engaged in activities other than those in high climate impact sector, is excluded from the Krka Group’s total energy consumption. The Group’s total net revenue in the denominator excludes revenue of Terme Krka. The excluded revenue corresponds to the amount stated in the consolidated income statement of the Krka Group. The indicator calculation has not been verified by an independent external body. The denominator was calculated using Krka Group net revenue disclosed in the ‘Financial report’ under ‘Notes to the consolidated financial statements’ (‘4. Revenue from contracts with customers’). The amount was decreased by Terme Krka d.o.o. revenue stated in the consolidated income statement.
Scope 1 direct emissions from sub-installations for heating and fuel are determined based on fuel consumption regulated under the EU emission trading system (ETS). Scope 1 emissions are calculated by multiplying purchased amounts of energy and the corresponding emission factors.
Scope 2 emissions include indirect GHG emissions from generated electricity and heat purchased and consumed in the Krka Group. They are generally calculated by multiplying purchased amounts of energy and the corresponding emission factors. Emissions calculated using the location-based method are based on the average emission factors of each country. Emissions calculated using the market-based method also include zero-carbon electricity purchased by the controlling company and its subsidiary Terme Krka.
Scope 3 emission calculation is divided into 15 categories (C1–C15). Data sources of emission factors for each category are presented below.
The calculation of the Scope 3 GHG emissions generated by the Krka Group relies on primary inputs (kg, EUR, l, km, m2, pieces, etc.). These emissions account for 98% of total Scope 3 GHG emissions. Primary data were obtained directly from business systems and categorised into key groups for each observed GHG emission source. The assessment of primary inputs was applied to employee commuting. A commute analysis for each employee was not carried out. The same assumptions regarding employee commuting were applied to both the controlling company and its subsidiaries. We determined the emissions by relying on primary and secondary data sources. Indirect emissions from purchased goods and services (Scope 3, Category 1) account for the largest share of total GHG emissions, i.e. 70.5%. All inputs for this category were obtained directly from Krka Group databases. Primary data for determining the emission factor for goods, namely active ingredients (APIs), the largest individual contributor of GHG emissions, were obtained from one of our major API suppliers. The emission factor was determined based on the supplier’s total Scope 1, 2 and 3 GHG emissions, relying on 2023 data. The factor was verified and confirmed by an independent agency, i.e. NAQ Certification Limited. The calculation of the API carbon footprint was based on the obtained emission data and the total production volume of APIs relevant to the emissions in question. It is considered the best estimate of the emission factor. It was also used to calculate the emission factor related to API supply by other suppliers. GHG emission ranges for APIs, pharmaceutical products and bulk products in other databases and literature vary significantly. Data sources from one of our key suppliers for 2023 were also used for pharmaceutical products and bulk products. The assessment was conducted by multiplying the total number of manufactured products and the average product mass per unit, which was determined based on the total production volume and mass of Krka Group products. These data allowed us to assess the emission factor of the obtained pharmaceutical products and bulk products. Scope 1, 2 and 3 carbon footprint data of the observed supplier were verified and confirmed by an independent agency, i.e. NAQ Certification Limited. This emission factor was also used to calculate the emission factor associated with the supply of this group of goods from other suppliers of products and bulk products.
The calculation of certain GHG emission categories relied on assumptions, which may introduce some level of uncertainty, as actual data could differ from the applied assumptions. Assumptions were applied to categories with a marginal share in total emissions; therefore, their impact on the reliability of the final outcome remains non-material. The calculation of water consumption by employees in Krka subsidiaries and representative offices (except at production sites) relied on the average drinking water consumption per office worker per year. The amount of waste in subsidiaries and representative offices was calculated using the assumption about the amount of waste per employee. Assumptions were also used to calculate electricity, natural gas and heat consumption by employees in subsidiaries and representative offices (excluding production sites). Assumptions were also applied to employee commuting, factoring in travel distance, vehicle type, travel allowance, and average attendance. Krka Group total GHG emissions calculated using the estimated inputs account for 2.5% of total Scope 1, 2 and 3 emissions.
Direct emissions from biofuel mix consumption are reported outside of Scope 1, 2 and 3 in accordance with the ISO 14064-1:2018 standard. Direct biogenic emissions are calculated by multiplying the amount of biofuel mix consumed and relevant emission factors. Indirect biogenic emissions are estimated based on our biofuel mix use within Scope 1.
The Krka Group comprises the controlling company Krka, d. d., Novo mesto, its Slovenian subsidiary Terme Krka, d. o. o., Novo mesto, 32 subsidiaries abroad, 17 representative offices, Ningbo Krka Menovo, a joint venture in China, and Krka Pharma Private Limited, a joint venture in India. Production takes place in the controlling company in Slovenia and at subsidiaries in the Russian Federation, Poland, Croatia, and Germany. Apart from Krka-Rus in the Russian Federation, these subsidiaries also deal with marketing and/or sales. Terme Krka provides health resort and tourist services and operates through the following branches: Terme Dolenjske Toplice, Terme Šmarješke Toplice, Hoteli Otočec, and Talaso Strunjan. Terme Krka is also the majority owner of Golf Grad Otočec. We applied the control approach to determine organisational boundaries because all the above-mentioned entities (except for the joint venture in India) are under the Krka Group’s financial and operational control.
• Indirect emissions from downstream transportation and distribution (category 9);
• Indirect emissions from end-of-life treatment of sold products (category 12).
The following GHG emissions were not included in line with the ESRS Disclosure Requirements under E1-6 – Gross Scopes 1, 2, 3 and Total GHG emissions (categories):
• Indirect emissions from processing of sold products (category 10);
• Indirect emissions from use of sold products (category 11);
• Indirect emissions from downstream leased assets (category 13);
• Indirect emissions from franchises (category 14);
• Indirect emissions from investments (category 15).
| 10– Indirect emissions from processing of sold products | These GHG emissions are generated during the processing of intermediate products by third parties (e.g. finished product manufacturers) subsequent to sale by the reporting company. The Krka Group manufactures and sells finished pharmaceutical products that require no processing before they are sold. |
|---|---|
| 11 – Indirect emissions from use of sold products | Users consume most of our products with a certain amount of water (e.g. 200 ml of cold or lukewarm water per tablet). Carbon footprint of 200 ml of water per dosage is marginal. If the amount is considered in relation to the usual water consumption by users, its significance is further minimised. This means that the pharmaceutical use phase is deemed to be a marginal carbon footprint phase, as it does not involve additional resource consumption, apart from a glass of water that the user would consume regardless. |
| 13– Indirect emissions from downstream leased assets | The Krka Group identified no assets that would be leased to other entities in 2024. Leases within the Krka Group are not considered to avoid double counting (leases are within the boundaries of the observed system). |
| 14– Indirect emissions from franchises | The Krka Group is a pharmaceutical entity that develops, manufactures and markets its products. Subsidiaries and business units around the world are companies wholly-owned by the Krka Group’s controlling company, rather than franchises, meaning that the production, distribution and sales in these countries are under our direct control and management. We do not employ the franchise model to expand our operations. We operate through our business units and partner networks. |
| 15– Indirect emissions from investments | The Krka Group is not a financial institution with significant equity investments. Capital expenditure in fixed assets the Group requires and uses to meet production needs is reported under category 10. This does not apply only to the investment in Medika, d. d., a company in which the Group holds a 11.97% share. Medika, d. d. is a wholesaler that sells, among others, products for the Krka Group. GHG emissions from these activities are included in the carbon footprint calculated under category 9 (services). GHG emissions from the investment were not considered, as organisational boundaries were defined using the control approach. |
In 2024, we calculated Scope 3 carbon footprint for the first time, which means that we could not identify any changes in inputs of the value chain. We intend to consider this issue in the next period and report on any changes. The above-mentioned categories apply the latest emission factors from relevant databases, specified in the tables below for each category.
Direct emissions from combustion in installations operated by the undertaking
DEFRA, Fuels, Fuel type
Direct mobile combustion emissions from vehicles owned by the undertaking
DEFRA, Fuels, Fuel type
Direct process emissions
| Emissions from electricity consumption (location-based method) | Electricity Map: https://app.electricitymaps.com/map/12mo/monthly | IEA: https://www.iea.org/countries |
|---|---|---|
| Emissions from electricity consumption (market-based method) | Supplier’s Guarantee of Origin from zero-carbon electricity, invoices | Consumption of other energy acquired from the grid |
| DEFRA, Heat and steam |
| 1 Purchased goods and services | • In-house calculation based on data from a major API supplier • In-house calculation based on data from a major lactose supplier • In-house calculation of pharmaceutical product and bulk product emissions obtained by internal analysis • LCA analysis of a representative aluminium production for the pharmaceutical industry, College of Industrial Engineering (Slovenia) • DEFRA, Products • DEFRA, Water supply • DEFRA, Advertising and market research services • DEFRA, Real estate services on a fee or contract basis • DEFRA, Wholesale and retail trade and repair services of motor vehicles and motorcycles • DEFRA, Restaurants, cafes and the like • DEFRA, Education services • DEFRA, Postal and courier services • DEFRA, Legal services • DEFRA, Printing and recording services • DEFRA, Computer programming, consultancy and related services • DEFRA, Scientific research and development services • DEFRA, Telephone and telefax services • DEFRA, Social work services without accommodation • DEFRA, Material use • DEFRA, Soap and detergents, cleaning and polishing preparations, perfumes and toilet preparations • DEFRA, Electrical equipment • DEFRA, Wearing apparel • DEFRA, Textiles • DEFRA, Glass, refractory, clay, other porcelain and ceramic • DEFRA, Basic pharmaceutical products and pharmaceutical preparations • DEFRA, Rubber and plastic products • Ecoinvent, Chemical production, organic [GLO] • Ecoinvent, Citric Acid [RER] • Ecoinvent, Sodium hidroxide [GLO] • CarbonCLoud, Limestone • Ecoinvent, Chemical production, inorganic [GLO] • CarbonCLoud, Vitamin mix, generic • Ecoinvent, Chemical production, inorganic [GLO] |
|---|---|
| 2 Capital goods | DEFRA, Multipliers |
| 3 Fuel- and energy-related activities (not included in Scope 1 or Scope 2) | DEFRA, WTT Fuels |
| 4 Upstream transportation and distribution | DEFRA, Freighting goods |
| 5 Waste generated in operations | DEFRA, Waste disposal |
| 6 Business travel | DEFRA, Business travel DEFRA, Hotel stay |
| 7 Employee commuting | DEFRA, Passenger vehicles |
| 8 Upstream leased assets | DEFRA |
| 9 Downstream transportation and distribution | DEFRA, Freighting goods |
| 12 End-of-life treatment of sold products | DEFRA, Waste disposal |
| Gross Scope 1 GHG emissions (tCO2 eq) | 56,868 |
|---|---|
| Percentage of Scope 1 GHG emissions from regulated emission trading schemes (%) | 49 |
| Gross location-based Scope 2 GHG emissions (tCO2 eq) | 41,453 |
|---|---|
| Gross market-based Scope 2 GHG emissions (tCO2 eq) | 17,133 |
| Total Gross indirect (Scope 3) GHG emissions (tCO2 eq) | 524,681 |
|---|---|
| 1 Purchased goods and services | 422,552 |
| Optional sub-category: Cloud computing and data centre services | / |
| 2 Capital goods | 25,383 |
| 3 Fuel- and energy-related activities (not included in Scope 1 or Scope 2) | 16,401 |
| 4 Upstream transportation and distribution | 23,418 |
| 5 Waste generated in operations | 17,006 |
| 6 Business travel | 2,730 |
| 7 Employee commuting | 9,488 |
| 8 Upstream leased assets | 2,645 |
| 9 Downstream transportation and distribution | 128 |
| 10 Processing of sold products | / |
| 11 Use of sold products | / |
| 12 End-of-life treatment of sold products | 4,929 |
| 13 Downstream leased assets | / |
| 14 Franchises | / |
| 15 Investments | / |
| Total GHG emissions (location-based) (tCO2 eq) | 623,001 |
|---|---|
| Total GHG emissions (market-based) (tCO2 eq) | 598,682 |
The Krka Group’s carbon footprint calculation includes the controlling company, subsidiaries, and joint ventures, consolidated in the financial statements of the Krka Group. The calculation does not include KRKA Pharma Private Limited, Hyderabad, India, a company established in April 2024 by Krka, d. d., Novo mesto, and Laurus Labs Ltd., India and jointly managed by the two entities based on the underlying agreement. Its registered capital will be paid up gradually. The first tranche was paid in in October 2024. The company has not generated any GHG emissions because it has not yet started its business operations. Krka, d. d., Novo mesto holds a 51% share in the company. The Krka Group accounts for the investment in the joint venture under the equity method.
In the Krka Group, 620.45 kg of HFC generated air emissions of 2,158.5 tCO2 eq in 2024. As per the ISO14064-1:2018 standard, the Krka Group generates no PFC emissions, meaning that these emissions total 0 tCO2 eq.
| Year | Total GHG emissions (location-based) per net revenue (tCO2 eq/€ million) | Total GHG emissions (market-based) per net revenue (tCO2 eq/€ million) |
|---|---|---|
| 2024 | 326.3 | 313.5 |
The denominators to calculate both indicators use Krka Group net revenue presented in the ‘Financial report’ under ‘Notes to the consolidated financial statements’ (‘4. Revenue from contracts with customers’). The metric has not been verified by an independent external body.
Energy acquired under contractual agreements for zero-carbon electricity accounts for 80% of the total electricity consumption across all Krka Group sites. Electricity is sourced from a nuclear power plant. The Energy Agency issued a Guarantee of Origin for electricity consumption to the controlling company and its subsidiary, Terme Krka.
Environmental Policy of the Krka Group
The management of material impacts related to pollution prevention and control is part of broader environmental policies and governance approaches. The most important of these is the Environmental Policy of the Krka Group, defined in ESRS E1 under Disclosure Requirement E1-2 – Policies related to climate change mitigation and adaptation.
Environmental pollution prevention and reduction are key to preserving a healthy planet. Our environmental management system embodies this principle. This topic is specified in detail in section 5 (Prevention and reduction of pollution) of the Environmental Policy of the Krka Group, where we state that through systematic education and training, we maintain a high level of environmental awareness among our employees, ensuring that the commitment to reducing environmental impacts is embedded in all processes and activities.
With regard to pollution, the Environmental Policy of the Krka Group pursues the following principles:
| 2019 | 66,245 |
|---|---|
| 2020 | 63,672 |
| 2021 | 64,192 |
| 2022 | 61,592 |
| 2023 | 59,029 |
| 2024 | 56,868 |
| Scope 1 | 77,067 |
| Scope 2 - market-based method | 73,345 |
| Scope 3 - upstream value chain | 15,688 |
| Scope 3 - downstream value chain | 15,625 |
| Scope 1 + Scope 2 | 519,624 |
| Scope 1 + Scope 2 + Scope 3 | 5,057 |
• Ensuring the use of less hazardous substances as much as possible as early as during the development phase;
• Ensuring safe use and rational consumption of materials in production;
• Proactive monitoring of technological advancements in the industry and implementation of new solutions into processes;
• Regular monitoring of environmental emissions.
By applying the principles of our environmental policy, we advance material positive impacts and prevent the occurrence of potential material negative impacts related to pollution.
To align with the environmental policy principles, we carry out activities in line with internal standard operating procedures (SOP on waste water discharge and treatment, SOP on the manual for air emission treatment systems, SOP on air emission monitoring) that address environmental impact areas and are part of our integrated business continuity management system. The system’s foundations are emergency identification, preventive measure implementation, fostering a strong safety culture, equipment installation using the best available techniques (BAT), and response measures. We adhere to our internal instructions to mitigate negative impacts on water and air, ensure the safe use of substances and materials, reduce the likelihood of occurrence and severity of potential incidents, and ensure effective actions to prevent environmental impacts of emergencies. We deliver educational courses and conduct drills to foster a strong safety culture.
The above-mentioned actions and activities apply to our own operations. Outside the Krka Group, we promote the environmental policy principles by encouraging the relevant stakeholders to implement the Code of Conduct for Business Partners of the Krka Group, which, among others, addresses air and water emissions and the prevention of spills.
This section describes pollution-related actions, including ongoing actions, actions taken in 2024, and planned actions.
We roll out pollution-related actions within our environmental management system (EMS), which complies with the ISO 14001 standard and ensures systematic management of all environmental matters to consistently reduce all environmental impacts. Through ongoing cooperation, information sharing, and investment, we disseminate robust environmental protection guidelines and practices across all subsidiaries.
We collect and analyse data about the environmental management system and verification of compliance of our activities with the environmental laws, environmental protection permits and the ISO 14001 standard through various methodological tools. We leverage all available resources, including monitoring environmental emissions, outcomes for our processes or activities with material environmental impact, findings of self-inspections and audits, internal audits, security checks, inspections, customer claims, and risk analyses. They confirm the system’s suitability and efficiency and highlight improvement opportunities. We report environmental data to our management, responsible committees, national authorities, for example, the Slovenian Environment Agency (reports on environmental emissions monitoring), the Association of Chemical Industries at the Chamber of Commerce and Industry of Slovenia (Responsible Care Reports – RC), and other stakeholders.
Our commitment to waste water and air treatment means we constantly aim to ensure that our environmental emissions comply with the laws and environmental protection permits. Compliance with the laws and environmental protection permits regarding waste water and air emissions is verified through operational monitoring by authorised accredited external institutions. We assess each potential deviation from permitted thresholds in accordance with internal standards and take appropriate corrective actions. In 2024, we identified deviations in waste water discharge by the public sewerage system at our Krško and Bršljin production sites (Slovenia). A highly efficient in-house waste water treatment plant is being constructed at the Krško production site. We have already implemented corrective actions at the Bršljin production site. Wastewater at both production sites is discharged into watercourses only after being treated at municipal waste water treatment plants. All other environmental emission monitoring results were in compliance with the laws.
Actions to reduce water emissions are implemented starting from the product development phase. Whenever possible, we use raw materials and excipients less harmful to water. We minimise the quantity of detergents used in production washing procedures and employ waste water treatment at all our production sites. Wastewater at off-site plants is treated at highly efficient municipal waste water treatment plants or highly efficient in-house waste water treatment plants using the best available techniques to meet the requirements. We use various physical, chemical and biological processes to remove pollutants from waste water. We comply with the Decree on the Emission of Substances and Heat in the Discharge of Wastewater from Installations for the Production of Pharmaceutical Products and Active Substances, which serves as the basis for environmental protection permits issued for individual Krka production sites.
Effective reduction of air emissions is one of our priorities in ensuring a healthy living environment and reducing climate change-related impacts and consequences, prompting us to launch many actions related to air pollution. We also consider EU actions to implement the European Green Deal, statutory requirements, and other stringent requirements applicable to the pharmaceutical industry. We aim to reduce air emissions using highly efficient waste air treatment systems fitted on all outlets that could constitute a potential source of pollution. We use effective de-dusting systems, filters, wet-type filtration systems, condenser columns, and thermal oxidisers to keep emissions below the statutory threshold or the levels the best available techniques allow.
A set of actions outlined in the Environmental Policy of the Krka Group and its section on the prevention and reduction of pollution. These actions form part of our long-term approach to protecting the environment and reducing pollution, which is systematically and precisely defined in our internal standard operating procedure (SOP) Environmental Management System. All our pollution-related activities strictly comply with statutory requirements, requirements specified in environmental protection permits, and other obligations we have committed to fulfilling.
The Committee for Monitoring Environmental Aspects conducts an annual review of environmental matters. The purpose of this review is to identify all potential negative environmental impacts and associated risks, prevent their occurrence and potential consequences, and reduce the likelihood of risk materialising. Based on the review, the Committee prepares proposals for environmental programmes for the Krka Group, assigns responsible persons and sets deadlines for implementation. The Management Board approves the proposals and allocates sufficient financial resources to the programmes. The environmental targets and programmes outline our annual specific activities aimed at preventing and reducing environmental impacts across all areas of environmental protection.
In 2024, we rolled out environmental targets and programmes related to pollution prevention and reduction, addressing the following environmental aspects: technological waste water discharge and treatment, run-off rain water discharge, and air emissions.
The Management Board approved the proposed environmental targets and programmes for 2025. Regarding pollution prevention and reduction, we will roll out waste water discharge and treatment programmes, an air emission reduction programme, and a programme related to the safe storage of energy generation units.
This action set is applied within our own operations, and we promote its implementation across the value chain via the Code of Conduct for Business Partners of the Krka Group. The Committee for Monitoring Environmental Aspects and the Quality Committee verify the actions’ effectiveness by monitoring the environmental policy’s effectiveness. We closely monitor pollution matters and intend to adopt additional actions as needed.
The controlling company has set environmental targets and programmes regarding waste water pollution, specifically the target of zero deviations in waste water emission monitoring, which is required by environmental protection permits. In 2024, waste water emission monitoring identified four deviations from thresholds defined in environmental protection permits. However, since all waste water is discharged via the sewage system equipped with waste water treatment plants at the final stage, no adverse environmental impacts occurred.
2024 Annual Report – Business report
The efficiency in achieving the targets is verified in operational monitoring by authorised accredited external institutions. Compliance with environmental targets for water and air pollution is a mandatory requirement in line with environmental laws and environmental protection permits. Our environmental management system, established per the ISO 14001 standard, is our voluntary commitment to constantly aim for reducing all environmental impacts. The targets apply to Krka’s own operations and are the same each year. No stakeholders were involved in target setting.
We regularly report all environmental impact results to competent governmental authorities to comply with the applicable legal obligations. Under Regulation (ES) No 166/2006 of the European Parliament and of the Council concerning the establishment of a European Pollutant Release and Transfer Register (E-PRTR Regulation) and its Annex II, we exceed the reporting threshold for air emissions in two parameters, namely dichloromethane and hydro-fluorocarbons.
| Pollutant | Threshold for releases (kg/year) | Annual amount (kg/year) |
|---|---|---|
| Dichloromethane (DCM) | 1,000 | 1,103 |
Disclosures related to the amount of hydro-fluorocarbons are addressed in ESRS E1 under Disclosure Requirement E1-6 – Gross Scopes 1, 2, 3 and Total GHG emissions. Measurements comply with the requirements of environmental protection permits, which are aligned with the relevant laws and best available techniques reference documents (BREF) and determine the scope and frequency of regular monitoring. Regular monitoring for the Krka Group is carried out by independent external institutions using accredited methods. The institution performing the monitoring drafts a report, factoring in all monitoring instances in a current year, and submits it within the prescribed deadline to governmental institutions, e.g. the Slovenian Environment Agency (ARSO) in Slovenia. The Slovenian Environment Agency considers the reports for the previous year when calculating the environmental tax. To ensure compliance with the relevant laws, we report data on the amount of volatile organic compounds based on measurements and mass balance equations. Pollution-related calculations and reports are based on data collected through regular monitoring as set out in environmental protection permits. No significant changes in air emissions have been observed over time. The consolidated amount of the above-mentioned pollutant is approximately equal to the reporting threshold.
Environmental Policy of the Krka Group
The management of material impacts and risks related to water and marine resources is part of broader environmental policies and governance approaches. The most important of these is the Environmental Policy of the Krka Group, defined in ESRS E1 based on Disclosure Requirement E1-2 – Policies related to climate change mitigation and adaptation. Care for natural water resources is key to preserving a healthy planet. Our environmental management system embodies this principle. Water and marine resources are detailed in section 8 (Care for natural water resources) of the Environmental Policy of the Krka Group, where we state that the supply of high-quality drinking water is crucial for producing pharmaceutical products. Therefore, the activities at our production sites focus extensively on effective waste water treatment and preservation of water body quality. We manage all water systems following good manufacturing practices and the HACCP system. By utilising advanced technologies, we ensure rational and efficient water use. Through systematic education and training, we maintain a high level of environmental awareness among our employees, ensuring that the commitment to reducing impacts on water and marine resources is embedded in all processes and activities.
With regard to water and marine resources, the Environmental Policy of the Krka Group pursues the following principles:
By applying the principles of our environmental policy, we advance material positive impacts and mitigate material risks related to water and marine resources. We apply this policy within our activities across the Krka Group, and encourage responsible management of water and marine resources throughout the value chain via the Code of Conduct for Business Partners of the Krka Group. We do not plan to develop products or services specifically designed to address water-related issues or preserve water resources.
Commitment to reduce material water consumption in areas at water risk
This applies to our own operations.
We have not adopted policies related to sustainable oceans and seas, as we have not identified material impacts, risks, and opportunities associated with this area.
This section describes the action set related to water and marine resources, including ongoing actions, actions taken in 2024, and planned actions.
We roll out water resources-related actions within our environmental management system (EMS), which complies with the ISO 14001 standard and ensures systematic management of environmental matters to consistently reduce environmental impacts. Through ongoing cooperation, information sharing, and investment, we disseminate robust environmental protection guidelines and practices across all subsidiaries.
We collect and analyse data about the environmental management system and verify compliance of Krka’s activities with environmental legislation, environmental protection permits, and the ISO 14001 standard through various methodological tools. We leverage available resources, including monitoring environmental emissions, outcomes for our processes or activities with material environmental impact, findings of self-inspections and audits, internal audits, security checks, inspections, customer claims, and risk analyses. They confirm the system’s suitability and efficiency and highlight improvement opportunities. We report environmental data to our management, responsible committees, national authorities, for example, the Slovenian Environment Agency (reports on environmental emissions monitoring), the Association of Chemical Industries at the Chamber of Commerce and Industry of Slovenia (Responsible Care Reports – RC), and other stakeholders.
Clean drinking water, which must meet strict chemical and microbiological quality requirements, is essential for the pharmaceutical industry. We manage all water systems following good manufacturing practices and the HACCP system. The activities at our production sites focus extensively on preserving the quality of water bodies.
We have obtained a water consent for extracting water from the Krka River for our site in Ločna, Novo mesto, where we manufacture the majority of Krka Group products. This consent defines the environmentally acceptable flow level below which water extraction is not allowed. Additionally, we have a water permit for the direct use of water from drinking water supply facilities for technological purposes, which requires regular monitoring of extracted volumes at the main water meter shaft. If the River Krka’s flow falls below the ecologically acceptable level specified in the water license, we can switch to an alternative water source from the public infrastructure.
We reduce our dependence on river water through various measures. In specific processes, such as cooling tower supply, river water is substituted with rain-water. Despite the identified risk associated with river water extraction, the River Krka’s flow remains significantly above the ecologically acceptable level, even during prolonged droughts. Therefore, we consider the risk to the water supply from the river to be acceptable. In the event of issues with drinking water supply, we compensate for shortages with pharmaceutical-grade water, stored in dedicated reservoirs specifically for such situations.
Two separate supply systems deliver water to the central distribution system and ensure that pharmaceutical water is continuously supplied to production. Our production sites are not situated in areas of high-water stress. All of these measures are regularly implemented or are available if necessary.
Fluctuations in drinking water quality are also influenced by seasonal variations and precipitation levels. We closely monitor water levels to ensure optimal operation of pharmaceutical water treatment systems and maintain water quality within the permitted levels. We manage all water systems in compliance with Good Manufacturing Practice (GMP) and the HACCP (Hazard Analysis Critical Control Point) system. We minimise system failures through planned preventive maintenance in line with equipment manufacturers’ recommendations, our experience, legal requirements, and industry standards.
We reduce specific drinking water use through various measures, such as flow regulators on taps, closed-loop systems, and water reuse. A computerised monitoring system tracks the total flow rate and overall consumption at production plant entry points and key user points, enabling immediate detection of any increase or deviation in drinking water use. This allows for prompt investigation of the cause and the implementation of all necessary measures to reduce use.
Ongoing actions also include a set of actions of the Environmental Policy of the Krka Group and its section on the care for natural water resources. These actions form part of our long-term approach to protecting natural water resources, which is systematically and precisely defined in our internal standard operating procedure (SOP) Environmental Management System. All our activities related to water resources strictly comply with statutory requirements, requirements specified in environmental protection permits, and other obligations we have committed to fulfilling.
The Committee for Monitoring Environmental Aspects conducts an annual review of environmental matters. The purpose of this review is to identify all potential negative environmental impacts and associated risks, prevent their occurrence and potential consequences, and reduce the likelihood of risks materialising. Based on the review, the Committee prepares proposals for environmental programmes for the Krka Group, assigns responsible persons and sets deadlines for implementation. The Management Board approves the proposals and allocates sufficient financial resources to the programmes. The environmental programmes set out our annual specific activities to prevent or reduce environmental impacts in each environmental protection matter.
In the 2024 programme, we focused on technological waste water discharge, treatment, and run-off rain-water discharge.
In 2025, we defined activities within the programme related to water resources, focusing on reducing the use of river water.
At Krka, we assess the effectiveness of actions against key benchmarks and targets. Once a year, the Quality Committee reviews the implementation of benchmarks and the achievement of targets. Actions related to waste water are also described in ESRS E2, Disclosure Requirement E2 – Actions and resources related to pollution.
This action set is applied within our own operations, and we promote its implementation across the value chain via the Code of Conduct for Business Partners of the Krka Group. The effectiveness of these actions is monitored through environmental policy performance reviews conducted by the Committee for Monitoring Environmental Aspects and the Quality Committee. We closely monitor the topic of water resources and will adopt additional actions as needed in the future.
Depending on available resources, the controlling company sources water from the public water supply system, river water, or groundwater from our own wells. The subsidiary Terme Krka, d. o. o., also uses seawater.
| Category | Quantity | Data source |
|---|---|---|
| Total water consumption (m3) | 2,245,471 | direct measurement and calculated value |
| Total water recycled and reused in m3 | 185,640 | direct measurement and calculated value |
| Total water consumption in m3 in areas at water risk | 0 | / |
| Total water stored and changes in storage (m3) | 1,947 | no changes in storage, direct measurement |
| Water intensity: total water consumption (in m3/€ million net revenue) | 1176 | calculated value |
The total water consumption in cubic metres per million euros of net revenue is calculated as the ratio between the total water consumption and the total net revenue of the Krka Group. Revenue data of the Krka Group and Terme Krka, d.o. o. are provided in the ‘Financial report’ in the ‘Notes to the consolidated financial statements’ (‘4. Revenue from contracts with customers’). The amount of recycled water in 2024 was 185,640 m3. The amount of stored water in 2024 was 1,947 m3. Compared to previous years, we are maintaining it at the same level.
According to the Water management plan in the Danube water area for the period from the year 2023 until the year 2027, Slovenia is classified as a country with a high amount of water based on the proportion of utilized water and is not located in an area of water stress. This plan also states that the ecological and chemical status of the lower Sava River basin, where the majority of our production in Slovenia is located, is good. Water consumption is mostly directly measured with flow meters, which are calibrated by external institutions (e.g. flow meters on the public water supply) or Krka’s Metrology department. The water consumption data for employees in Krka’s subsidiaries and representative offices is calculated using a formula that considers an average consumption of 15 m3 of drinking water per office worker per year, which is comparable to the EU data on drinking water consumption. The metrics have not been verified by an independent external body.
The quantity of recycled and reused water for our production sites in Ločna, Bršljin, Krško and Šentjernej was obtained through direct measurement. For our other production sites, we estimated the quantity of recycled and reused water based on the assumption that the amount per unit of production is the same as at the Ločna site. The metrics have not been verified by an independent external body.
appropriate actions, carrying out activities, and remaining committed to protecting the environment and natural habitats in which we operate.
All Krka production sites in Slovenia and abroad, including non-EU countries, comply with and implement guidelines and requirements of the European and national legislation on biodiversity and ecosystems to try to preserve the natural world’s ecological, biotic and landscape features. All our production facilities are concentrated within their respective sites and do not sprawl into ecologically sensitive areas.
Actions identified under Disclosure Requirement E4-3 – Actions and resources related to biodiversity and ecosystems and actions disclosed under Disclosure Requirements of topical standards E1, E2, E3 and E5 reduce the impacts of our activities on biodiversity and ecosystems and the likelihood of occurrence of potential material negative impacts.
Regarding actions and activities outside our own operations, but within our value chain, we encourage our partners to adhere to the guidelines in our Code of Conduct for Business Partners of the Krka Group and to respect sustainability principles related to biodiversity and ecosystems.
Management of material impacts related to biodiversity and ecosystems is part of a wider set of environmental policies and governance approaches. The most important of these is the Environmental Policy of the Krka Group, defined in ESRS E1 based on Disclosure Requirement E1-2 – Policies related to climate change mitigation and adaptation.
Preservation of biodiversity and ecosystems is key to preserving a healthy planet. Our environmental management system embodies this principle. Actions to mitigate potential material negative impacts related to pollution, biodiversity and ecosystems are defined in Section 7 (Efforts to preserve biodiversity and ecosystems) of the Environmental Policy of the Krka Group. This section specifies that we are committed to protecting the natural environment and habitats in which we operate, to sustainable use of natural resources, and to reducing our carbon footprint. We educate and raise awareness among employees and the broader public. This ensures that the commitment to reducing impacts on biodiversity and ecosystems is embedded in processes and activities.
With regard to biodiversity and ecosystems, the Environmental Policy of the Krka Group pursues the following principles:
Implementing the principles of our environmental policy will advance material positive impacts and prevent or reduce the likelihood of occurrence of potential negative impacts related to biodiversity and ecosystems.
The Environmental Policy of the Krka Group embodies our strategic commitments to preserve biodiversity and ecosystems and our strategic commitments to reduce impacts and adjust our operations to climate change (see ESRS E1 for more disclosures) and to reduce pollution (see ESRS E2 for more disclosures). Governance approaches in these areas help us comprehensively understand our impact on preserving biodiversity and ecosystems. Therefore, the disclosures must be read in conjunction with those under other topical environmental standards (E1, E2, E3, and E5). Actions and activities in these areas strengthen material positive impacts and reduce the likelihood of occurrence of material negative impacts on biodiversity and ecosystems. We have not identified any material dependencies and material physical and transition risks and opportunities arising from biodiversity and ecosystems, so they are not included in the Environmental Policy of the Krka Group. The Policy does not describe the traceability of products, components and raw materials with actual or potential material impacts on biodiversity and ecosystems along the value chain, nor does it cover production, sourcing, or consumption within ecosystems managed to maintain or enhance biodiversity conditions. Furthermore, the Policy does not address the social consequences of biodiversity and ecosystems-related impacts.
We have adopted no biodiversity and ecosystem protection policy covering operational sites owned, leased, or managed by the company and located in or near a biodiversity-sensitive area.
This section describes the action set related to biodiversity and ecosystems, including ongoing actions, actions taken in 2024, and planned actions.
We roll out biodiversity and ecosystem-related actions indirectly within our environmental management system (EMS), which complies with the ISO 14001 standard and ensures systematic management of environmental matters to consistently reduce environmental impacts. Through ongoing cooperation, information sharing, and investment, we disseminate robust environmental protection guidelines and practices across all subsidiaries.
We collect and analyse data about the environmental management system and verification of compliance of Krka’s activities with the environmental legislation, environmental protection permits, and the ISO 14001 standard through various methodological tools. We leverage all available resources, including monitoring environmental emissions, outcomes for our processes or activities with material environmental impact, findings of self-inspections and audits, internal audits, security checks, inspections, customer claims, and risk analyses. They confirm the system’s suitability and efficiency and highlight improvement opportunities. We report environmental data to our management, responsible committees, national authorities, for example, the Slovenian Environment Agency (reports on environmental emissions monitoring), the Association of Chemical Industries at the Chamber of Commerce and Industry of Slovenia (Responsible Care Reports – RC), and other stakeholders.
The Committee for Monitoring Environmental Aspects and Engineering and Technical Services prepares draft environmental programmes for the Krka Group each year. The Management Board approves the draft and allocates sufficient financial, human and organisational resources to the programmes. The annual programmes specify ongoing activities and actions to increase positive impacts, prevent the occurrence and consequences of negative impacts and reduce the likelihood of occurrence of risks, while setting targets for specific environmental protection activities with a direct impact on biodiversity and ecosystems, geared towards efficiently and appropriately managing biodiversity and ecosystem-related impacts.
Actions and resources related to biodiversity and ecosystems are also indirectly referred to in E1, E2, E3 and E5 standards under specific Disclosure Requirements for specific actions and resources of specific topical standards.
Biodiversity was not directly specified in the 2024 programme.
Our biodiversity-related environmental programmes for 2025 now also cover engagement with associations dedicated to preserving biodiversity and planting bee-friendly trees.
We implement the action set in our own operations. The Code of Conduct for Business Partners of the Krka Group also includes these actions, encouraging actors along our value chain to implement them. The Committee for Monitoring Environmental Aspects and the Quality Committee verify the effectiveness of the actions by monitoring the effectiveness of the environmental policy. We closely monitor biodiversity and ecosystem-related matters, particularly our material direct impacts, and intend to adopt additional actions if necessary.
We used no biodiversity offsets in our action plans.
We have not yet identified any direct targets related to biodiversity and ecosystems. We carefully monitor these issues, particularly our material and non-material direct impacts, potential risks, and opportunities. We will add strategic targets if needed. Indirect targets contributing to reducing environmental burden and preventing the occurrence of negative impacts are presented under other topical standards, notably under E1 – Climate change and E2 – Pollution. We conduct regular monitoring to observe impacts on biodiversity in terms of climate change and pollution.
We have no direct metrics on the preservation of biodiversity and ecosystems. Our largest production site (Ločna in Novo mesto, Slovenia), stretching over 25.1 hectares, is not a biodiversity-sensitive area, but is near the River Krka, which is an ecologically important area (EIA) and protected as a Natura 2000 site.
Environmental Policy of the Krka Group Management of material impacts and risks related to resource use and circular economy is part of a broader set of environmental policies and governance approaches. The most important is the environmental policy, defined in ESRS E1 and based on Disclosure Requirement E1-2 – Policies related to climate change mitigation and adaptation.
Rational use of resources and efforts to adhere to circular economy principles are key to preserving a healthy planet. Our environmental management system embodies this principle. The Environmental Policy of the Krka Group describes the efficient use of resources and circular economy in detail. Actions geared towards impacts and risks related to resource use and circular economy are specified in section 4 (Efficient use of resources and circular economy) of this policy, which states that ‘in all our activities, we prioritise rational use of resources, energy efficiency, and the reduction of all emissions into the environment while adhering to the circular economy. We invest in developing sustainable production processes and collaborate with suppliers who respect our environmental values’. We operate within the constraints of the strict regulations governing the pharmaceutical industry. This ensures that resource efficiency and circular economy principles are integrated into all processes and activities.
We adhere to the legally prescribed waste management hierarchy, which includes waste prevention, reuse, separate collection, energy recovery, and safe disposal. In line with this section, we pursue the following principles:
By implementing the principles of our environmental policy, we advance material positive impacts and mitigate risks related to the ESRS E5 standard, arising from reliance on and availability of natural resources. The shift away from untreated resources, including a relative increase in the use of secondary (recycled) resources, is primarily achieved by maximising the share of regenerated solvents. However, strict regulatory requirements in pharmaceutical production significantly limit the use of secondary or recycled resources. Legislation generally prohibits their use, except in specific parts of the production process and for certain packaging materials. The environmental policy addresses Krka Group’s own activities regarding resource use and circular economy.
Through the Code of Conduct for Business Partners of the Krka Group, which fully incorporates the principles of our environmental policy, we also encourage the adoption of these principles within our value chain, particularly upstream.
This section describes the action set related to resource use and circular economy, including ongoing actions, actions taken in 2024, and planned actions.
must be used efficiently. Our commitment to the sustainable use of natural resources and circular economy presents us with ever-new challenges, which we address through projects, activities, and the engagement of all employees. We collect and analyse data on the environmental management system and verify compliance of Krka’s activities with environmental legislation and environmental protection permits through various methodological tools. We leverage available resources, including monitoring environmental emissions, outcomes for our processes or activities with material environmental impact, findings of self-inspections and audits, internal audits, security checks, inspections, customer claims, and risk analyses. They confirm the system’s suitability and efficiency and highlight improvement opportunities.
We report environmental data to our management, responsible committees, national authorities, for example, the Slovenian Environment Agency (reports on environmental emissions monitoring), the Association of Chemical Industries at the Chamber of Commerce and Industry of Slovenia (Responsible Care Reports), and other stakeholders. The Committee for Monitoring Environmental Aspects and Engineering and Technical Services prepare draft environmental programmes for the Krka Group each year. The Management Board approves the draft and allocates sufficient financial, human and organisational resources to the programmes.
Individual measures are based on the sections in the Environmental Policy of the Krka Group related to pollution, water and marine resources, and reducing the impact of our activities on climate change. They are described based on Disclosure Requirements under other environmental topical standards.
In line with the waste management hierarchy, our primary target is to prevent waste generation. We pursue this target by optimising production processes and packaging materials, regenerating and reusing solvents, introducing returnable packaging, and using electronic media. The next priority is the reuse of waste materials. However, due to strict regulations governing pharmaceutical production, this stage of waste management can only be applied to a limited extent. We reuse pallets and return certain types of packaging for further use. At the third stage of the waste management hierarchy, we focus on separate waste collection, one of our key waste management targets. We hand over separately collected waste fractions to contracted waste collectors and processors who prepare them for reuse or recycling. Some of these separately collected waste materials are sent to processing facilities for conversion into raw materials or secondary resources. We treat separated waste as a valuable source of raw materials – we separate and collect it at the point of generation and prepare it for reuse. All employees in the Krka Group are involved in the waste separation system. Our system relies on advanced equipment for separated collection, pressing and waste transportation. As part of our energy recovery efforts, all waste suitable for this process is transferred to contracted waste processors, where it is processed and prepared for energy utilisation. As the final step in the waste management hierarchy, we ensure the safe disposal of waste, including through incineration by contracted waste disposal providers and landfilling.
Due to strict pharmaceutical production regulations, the industry faces limitations in implementing circular economy principles. Waste materials generated at the end of processes that cannot be reused due to regulatory restrictions that govern pharmaceutical production are sorted appropriately and handed over for processing, recycling, or energy recovery. The return and processing of products, their reuse, disassembly, and similar circular business practices are not permitted in pharmaceutical production.
However, we apply circular economy principles wherever possible. In collaboration with our suppliers, we work to increase the share of recycled materials in transport packaging, optimise packaging dimensions and grammage, and utilise regenerated solvents. For secondary and transport packaging, we apply the concept of environmental suitability, ensuring that all materials used are fully recyclable. To ensure the safe disposal of unused products by end users and the separate collection and recycling of packaging placed on the market with our products, we participate in joint waste management schemes for pharmaceutical products and waste packaging under the Extended Producer Responsibility (EPR) system. We handle waste in compliance with legal requirements, waste management plans, and standard operating procedures (SOPs), adhering to the legally mandated waste management hierarchy, circular economy principles, and commitments set out in the ISO 14001:2015 environmental standard related to continuous reduction of environmental impacts.
By manufacturing single-pill combination medicines – which contain two or more active ingredients in a single product – we reduce the use of packaging and excipients as well as waste generation compared to the production of single active ingredient medicines.
A significant waste stream consists of waste organic solvents, which we separate into chlorinated and non-chlorinated categories. Chlorinated waste solvents are handed over for regeneration via a contract collector, while organic solvents are processed for energy recovery.
In 2024, several environmental programmes were implemented to enhance resource use and promote a circular economy: introduction of new returnable packaging for bulk product supply, optimisation of packaging size and material grammage, procurement of equipment for separate waste collection, renovation of facilities for organic kitchen waste separation, and the refurbishment of the packaging washing station.
At the end of 2024, the Management Board approved environmental programmes for 2025. In the area of resource use and circular economy, we will continue with activities to optimise packaging materials, increase the share of returnable packaging, and procure additional waste management equipment. These programmes aim to reduce the amount of waste packaging and landfill waste.
The listed action set is continuously implemented within the Krka Group‘s operations, while measures within the value chain are promoted through the Code of Conduct for Business Partners of the Krka Group. The Committee for Monitoring Environmental Aspects and the Quality Committee verify the effectiveness of the actions by monitoring the effectiveness of the environmental policy.
In the 2024–2028 Krka Group Development Strategy, we have set a strategic target to reduce the specific amount of waste generated in pharmaceutical activities per unit of product by 3% per year. In 2024, the baseline year, our pharmaceutical activities generated 0.73 kg of waste per one thousand product units. The calculation of the specific amount of waste includes the volume of finished products manufactured in our pharmaceutical production and the Krka Group’s waste, excluding waste generated by the subsidiary Terme Krka, d. o. o. Achieving this target has contributed to the successful implementation of the waste reduction guidelines outlined in the Environmental Policy of the Krka Group.
The data is sourced from the waste management information system (IS-Odpadki) and internal measurements, but has not been verified by an independent external body. The targets are set at the Krka Group level without stakeholder involvement. The targets focus on reducing resource outflows and waste generation while increasing waste recycling, and they are set annually.
Our comprehensive waste management system adheres to the legally mandated waste management hierarchy. Our primary objective is to prevent waste generation, followed by reuse, separate collection, energy recovery, and finally, the safe removal and disposal of waste. This approach ensures strong compliance with the waste management hierarchy, reflected in the increased use of reusable packaging, higher volumes of recyclable waste, consistently high levels of waste sent for regeneration, and a reduction in waste sent to landfill.
We also link resource use and circular economy to our target of specific energy consumption per unit of product, which is described in ESRS 1 based on Disclosure Requirement E1-4 – Targets related to climate change mitigation and adaptation. This target aligns with sustainable sourcing and the use of renewable resources to reduce environmental impacts and resource consumption. It is defined at the Krka Group level without stakeholder involvement.
We closely monitor resource use and circular economy matters. To further improve the monitoring of environmental policy implementation, impact and risk management, and assess effectiveness, we may set additional targets in the future. Regulatory restrictions prevent the implementation of circular product design, durability, reparability, or recyclability in the pharmaceutical industry. We are integrating circular business practices and recycling into the supply chain by optimising packaging design and implementing return for reuse systems.
Circular material use is maximised through the regeneration and reuse of solvents, as well as the reuse of returnable packaging (e.g. pallets). We are introducing transport packaging that incorporates recycled materials.
We ensure the rational use and reduction of raw material quantities through extensive research and development, leading to innovative products containing multiple active ingredients and optimised technological processes. The targets outlined above do not directly impact biodiversity and ecosystems. However, indirectly, resource outflow targets reduce the need for resource inflows in the early stages of production, minimising waste generation later in the process.
Strict regulatory frameworks in pharmaceutical production significantly restrict our ability to source sustainably and utilise renewable resources. As a result, we have not set targets in this area.
Our targets are based on our own voluntary commitments. In setting these targets, we have also taken into account the guidelines for the EU’s six key environmental objectives.
Key resource inflows include raw materials, water, packaging materials, energy sources, and fixed assets used in producing active ingredients, medicines, and product packaging. The most important raw materials are organic solvents, which play a significant role in the production of active ingredients, and active ingredients themselves. Another material resource inflow is bulk products, manufactured by our contract partners in the upstream value chain. We ensure an uninterrupted supply of these resources by diversifying our supply chain across multiple suppliers and maintaining security stock for these resources.
In 2024, the total weight of products and technical materials consumed in product manufacture amounted to 42,933 tonnes. This included 1,383 tonnes of active ingredients, 5,232 tonnes of organic solvents, and 819 tonnes of bulk products. For product packaging, we used 15,700 tonnes of packaging materials. Water and energy consumption is disclosed in topical standards E1 and E3.
In 2024, we consumed 2,076 tonnes of regenerated solvents in manufacturing active ingredients, accounting for 4.84% of the total weight of all materials used in 2024. These figures were obtained from the business information system SAP and have not been verified by an independent external body.
The data on resource consumption are directly sourced from Krka’s SAP information system (ERP system: Enterprise Resource Planning system). Data on water and energy consumption are outlined in the environmental topical standard E1 based on Disclosure Requirement E1-5 – Energy consumption and mix, and in topical standard E3 based on Disclosure Requirement E3-4 – Water consumption.
Our core business is the production of pharmaceutical products in different pharmaceutical forms used to treat different medical conditions. Due to strict pharmaceutical production regulations, the industry faces limitations in implementing circular economy principles. The return and processing of products, their reuse, disassembly, and similar circular business practices are not permitted in pharmaceutical production. Due to strict regulative requirements concerning quality, safety and efficacy of medicinal products, as well as the nature of the products, we cannot consider our products as designed according to circular economy principles, such as durability, reusability, repairability, disassembly, remanufacturing, and refurbishment. Recycling is only possible for packaging. However, even here, the use of materials is predominantly strictly regulated. However, we adhere to the principles of circular economy where possible.
A significant aspect of the products we market is their packaging. The use of recycled materials in primary packaging of pharmaceutical products is not permitted. However, they can be used in transport packaging. The share of recycled materials in transport cardboard packaging is 92%. This data was obtained from transport packaging material supplier.
| Category | 2024 | Unit | Notes |
|---|---|---|---|
| Waste (total) | 12,697 | t | Total amount of waste generated across all Krka Group activities |
| Waste diverted from disposal | |||
| Hazardous waste (total) | 5,174 | t | hazardous waste diverted for regeneration or energy recovery |
| – of which preparation for reuse | / | t |
| Halogenated waste solvent | – of which recycling | 494 t |
|---|---|---|
| – of which other processing methods | 4,680 t | non-halogenated waste solvents, packaging with hazardous residues, machine oils |
| Non-hazardous waste (total) | 5,512 t | non-hazardous waste diverted for recycling or energy recovery |
| – of which preparation for reuse | 2 t | printing toners, cartridges |
| – of which recycling | 3,510 t | waste packaging (paper, plastic, glass, metal, wood, electrical and electronic equipment, herbs, composite packaging materials) |
| – of which other processing methods | 1,999 t | wooden packaging, small mixed packaging, sludge from biological waste water treatment plant, biodegradable organic waste, waste oils |
| Waste scheduled for disposal | ||
| Hazardous waste | 401 t | hazardous waste, diverted for incineration |
| – of which incineration | 401 t | waste from pharmaceutical production containing hazardous substances, waste chemicals |
| – of which landfill | / t | |
| – of which other disposal operations | / t | |
| Non-hazardous waste | 1,610 t | non-hazardous waste, diverted for incineration and disposal |
| – of which incineration | 824 t | waste from pharmaceutical production (material rejected from packaging lines, waste medicinal products) |
| – of which landfill | 786 t | mixed municipal waste, small quantities of mixed construction waste |
| – of which other disposal operations | / t |
| Total amount of non-recycled waste | 8,690 t | waste diverted for incineration or energy recovery, and landfill disposal |
|---|---|---|
| Percentage of non-recycled waste | 68 % |
A significant waste stream in pharmaceutical production consists of waste solvents and waste from manufacturing pharmaceutical products (waste products, bulk products). To ensure uninterrupted dispatch and the most environmentally responsible disposal, we have partnered with several verified and registered waste collection companies that provide the most environmentally appropriate treatment or disposal of waste.
based on internal waste management records. The volumes of waste generated during manufacture at production sites abroad and at the subsidiary Terme Krka, d. o. o. are based on records from local waste collection companies. The volumes of waste generated at other subsidiaries and representative offices outside Slovenia are estimated based on the number of employees in these entities, assuming that each employee in administrative roles generates 5.4kg of waste paper, 5 kg of waste plastic, 6.5 kg of organic waste, 1 kg of electronic waste, and 3.7 kg of mixed municipal waste per year. Data on the volumes of waste at the subsidiary Terme Krka, d. o. o. were obtained from internal records and public waste management service providers. The metrics have not been verified by an independent external body.
We monitor waste in accordance with statutory monitoring requirements. Waste is categorised into categories based on waste assessment results. We submit waste data annually to the relevant state institutions. This data is not verified by an independent external body.
Key policies related to own workforce include the Human Rights Policy of the Krka Group, the Diversity, Equity and Inclusion Policy of the Krka Group, Krka’s Code of Conduct, and the occupational safety and health policy. These policies refer to the entire own workforce and serve to effectively manage material impacts, risks and opportunities related to own workforce.
The Policy outlines our commitment to respecting human rights across all aspects of our operations. We are committed to fostering an environment that ensures dignity, equality, and fairness for all stakeholders. The Policy commits us to respecting internationally recognised human rights, raising awareness about the importance of protecting them, strengthening our responsibility for them, and contributing to the UN Sustainable Development Goals. It identifies significant human rights areas associated with our products, services, and business relationships. The Policy prohibits slavery, human trafficking, forced labour, child labour, and discrimination. It highlights our respect for diversity and stipulates that we ensure fair and equitable working conditions, a safe and healthy working environment, the right to assemble and associate, and to receive regular information, and that we protect personal data, the environment and health.
The Policy also binds us to review the implementation of its commitments and monitor and supervise its implementation. The Policy relates to material impacts, risks and opportunities associated with own workforce and the ESRS S1 standard. The Policy applies to all Krka Group employees and serves as the basis for further reinforcing our expectations of business partners throughout the supply and sales chain. It is the foundation for the continued development of our corporate culture and complements our Code of Conduct and sustainability commitments, along with our policies and development strategy.
The responsibility of overseeing the implementation of human rights commitments lies with the relevant Management Board member and the Chief Compliance Officer, who inform the Sustainability Committee. At their regular meetings, the Management and Supervisory Boards address various topics, including human rights.
The Diversity, Equity and Inclusion Policy outlines our commitment and underlying principles to respecting and creating a diverse, equitable, and inclusive environment. The primary purpose of the Policy is to ensure Krka’s responsible approach to employees and fair relationships among them. Treating employees with care and professionalism is an important objective for Krka. We prioritise attracting and retaining talent as a key aspect of our core sustainability commitments. The Policy guides us in building diverse teams, where we highly value and respect the diversity of our knowledge, experiences, and perspectives that extend beyond race, nationality, gender, sexual orientation, age, religion, socio-economic status, or other personal circumstances. By fostering a responsible attitude toward everyone, we cultivate fair systems and an inclusive, supportive environment that aligns personal goals and needs with the company’s objectives. This approach enhances our appeal to potential employees and helps us maintain or improve employee engagement. We encourage dialogue between the management and employees and facilitate the exchange of opinions and collaborative problem-solving. Key channels include the Works Council, worker assemblies, meetings between employees and senior management, in-house newsletters, and annual performance reviews. We regularly gauge the organisational climate and introduce improvements based on the results. We respect the right of every employee to unionise and express their opinions without fear of discrimination or retaliation. Our commitments arising from the Policy are a significant part of Krka’s identity and are reflected in our daily activities.
Through the Policy, the Krka Group is committed to:
The Policy sets out three fundamental principles. Diversity is the foundation of our collaborative culture in an international environment. It is reflected in the actions, knowledge, and experiences that each team member contributes to fulfilling our shared mission and progress. Our global community is composed of numerous cultures, ideas, and identities. By recognising and valuing these differences, we harness our collective strength, which forms the basis for innovation and responsiveness in our work.
We understand fairness as a commitment to the just and equitable treatment of all employees, ensuring that everyone, regardless of gender, religion, or belief, health status, age, sexual orientation, race, or nationality, has equal opportunities for growth and success. We adhere to the principles of non-discrimination and equal opportunity throughout our recruitment processes, employee engagement, integration into work processes, professional and personal development, and recognition of successful performance.
Diverse ideas that we then integrate into our business practices. Inclusion is the foundation upon which we build our teams, develop our products, and collaborate with the global community.
The Policy relates to material impacts, risks and opportunities associated with own workforce and the ESRS S1 standard. It applies to all Krka employees and serves as the basis for further reinforcing our expectations of business partners throughout the value chain.
The Management Board member in charge of compliance and the Chief Compliance Officer oversee the implementation of the Policy and report to the Sustainability Committee.
Krka’s Code of Conduct defines the principles and rules of ethical conduct and good business practices that are binding to all employees. It is the foundation of all internal policies. The Code is presented in more detail under G1, Disclosure Requirement G1-1– Business conduct policies and corporate culture.
The occupational safety and health policy commits us to creating a safe and healthy work environment for all employees. The implemented system of occupational safety and health in the controlling company complies with the ISO 45001 standard and is fully incorporated into Krka’s quality management system. The quality management system covers all employees in subsidiaries in line with the national legislation and corporate recommendations. The policy applies to all Krka Group employees. Krka’s management is tasked with implementing the policy, while the heads of organisational units and all employees are responsible for implementing specific tasks. The policy relates to material impacts and opportunities associated with occupational safety and health.
At Krka, we have established a systematic approach to handling and addressing reports of inappropriate conduct and violations of applicable regulations, internal rules, ethical principles, policies, and human rights. Every employee can file a report with the Chief Compliance Officer ([email protected]), who usually appoints a working team of experts not affected by the matter to investigate the suspected non-compliance. We protect reporters as required by the legislation. The procedures are detailed in the Rules on Fraud Prevention, Detection and Investigation. Protection measures address confidentiality of information about the report and the reporter and the support to the reporter. Any retaliation against the reporter is considered a severe breach of Krka’s Code of Conduct. When the case is closed, a remedy is provided if justified. Directors are responsible for corporate compliance in subsidiaries and representative offices and report to the Chief Compliance Officer. Local compliance officers may be appointed, depending on the size of the subsidiary or representative office, and in accordance with local legislation.
Internationally recognised instruments and principles, embodied in policies related to own workforce (Human Rights Policy of the Krka Group; Diversity, Equity and Inclusion Policy of the Krka Group; and Krka’s Code of Conduct):
On 31 May 2019, Krka signed the Commitment to Respect Human Rights in Business Operations instigated by the Ministry for Foreign Affairs of the Republic of Slovenia. Twenty-four major Slovenian companies signed the document. At the state level, the issue is governed by the National Action Plan of the Republic of Slovenia on Business and Human Rights.
The above-mentioned policies related to own workforce also address human trafficking, forced labour, and child labour. These matters are specifically addressed in the Human Rights Policy of the Krka Group, which stipulates that, in line with ILO conventions No. 29 Forced Labour Convention and No. 105 Abolition of Forced Labour Convention, forced, slave, or compulsory labour and human trafficking are prohibited in our operations and throughout our entire value chain. Child labour is prohibited, and we specifically protect young workers. In accordance with ILO conventions No. 138 Minimum Age Convention and No. 182 Worst Forms of Child Labour Convention, the employment of children is prohibited anywhere within our group or our value chain.
We have procedures in place to engage with our own workforce and workers’ representatives aimed at addressing and managing material impacts on the workforce. This ensures that our own workforce’s perspectives are considered in key processes.
We employ multi-level engagement mechanisms, meaning we engage directly with our employees and indirectly through workers’ representatives.
The controlling company employs a systematic and structured approach to employee engagement. In each country where we operate, we align our employee representation mechanisms with national laws and organisational structures. The type of engagement in companies with workers’ representatives is shaped by local specificities and agreements between local management and workers’ representatives, allowing us to adapt the engagement modality to the cultural and legal specificities of the market. Where there are no trade unions or workers’ representatives, other employee engagement modalities are in place to ensure equivalent worker representation and provide the opportunity to raise concerns. The mechanisms are detailed below.
We provide opportunities for direct dialogue and meetings between employees and the management. In certain countries, we hold regular meetings between employees and local managerial staff, where employees can directly ask questions, present incentives, and give proposals to improve the working environment. The frequency of the meetings depends on the needs of each site, meaning that the meetings can take place quarterly or half-yearly based on the size of the unit and the dynamics of change.
Employees can directly contact their superiors and managerial staff of subsidiaries and representative offices, enabling a swift discussion of any questions, incentives, or issues put forward.
We designate local compliance officers tasked with supervising corporate compliance and integrity and handling non-compliance reports. Each unit has a designated local compliance officer who independently works and handles employee reports of non-compliances. Employees can make anonymous reports, affording them protection against retaliation.
Locally designated personnel are tasked with engaging with employees. Employees can also directly address their questions and concerns to relevant departments or representatives, such as those from Human Resources, or to authorised certified health and safety officers. Department representatives communicate employee incentives to the management and may propose changes.
We regularly conduct organisational climate and satisfaction surveys in all subsidiaries and representative offices to understand employees’ needs, even in the absence of formal representation structures.
The Supervisory Board addresses worker participation in management. The Worker Director, representing workers’ interests related to human resources and social issues, is a Member of the Management Board. A Deputy President of the Supervisory Board also acts as an employee representative.
Krka has not concluded any global framework agreements or other agreements with workers’ representatives regarding respect for the human rights of its own workforce.
Organisational climate surveys allow us to assess employee engagement and satisfaction levels and identify any issues. We adopt actions and monitor their delivery. Incentives adopted as a result of feedback provided by employees or workers’ representatives are discussed at Works Council meetings. Structured dialogue via direct communication channels, the Works Council, trade unions, and satisfaction surveys ensures timely identification and management of material impacts on employees. This engagement mechanism aims at improving working conditions, increasing employee involvement and reducing workforce-related risks, which, in turn, leads to the company’s long-term stability and competitiveness.
Proposal system: We encourage employees to submit proposals to improve work processes, occupational safety, and other matters. We regularly examine submitted proposals, roll out feasible solutions, and inform our employees about adopted actions.
Krka has not concluded any special agreements to evaluate the effectiveness of engagement with its own workforce. All employees, regardless of their position or circumstances, can make their concerns or suggestions directly known to the company’s management, direct supervisors, and workers’ representatives.
We have established a systematic approach to handling and addressing reports of inappropriate conduct and violations of applicable regulations, human rights, internal rules, and ethical principles. Every employee can file a report via e-mail to the Chief Compliance Officer, who usually assigns a working team of experts not affected by the matter to investigate the suspected non-compliance. When the case is closed, a remedy is provided. Employees can find details on the applicable procedure in the Diversity, Equity and Inclusion Policy of the Krka Group, the Human Rights Policy of the Krka Group, and Krka’s Code of Conduct, all available on Krka’s website and the Krkanet intranet portal. Each subsidiary with over 50 employees has a designated local compliance officer tasked with handling the reports, assessing the risks, and implementing appropriate actions. We guarantee anonymity to reporters and protect them against any potential retaliatory measures.
Harassment officers handle reports, gather relevant information, and adopt actions to prevent inappropriate conduct. We adopted clearly defined rules to ensure speedy and effective handling of improper conduct and, in turn, foster respectful relationships.
Employees can also raise their concerns through the Works Council or directly with the Worker Director as the Member of the Management Board representing workers’ interests.
We promote open communication, enabling employees to communicate their concerns directly to their superiors. We regularly train and raise awareness among employees about business integrity and ethical conduct. Information on available channels for raising concerns and procedures for handling them is published on the intranet and in internal publications.
We work together with trade unions and workers’ representatives to establish and improve the mechanisms for raising concerns.
We ensure the effectiveness of the channels by monitoring the reports filed with the Chief Compliance Officer and local compliance officers. The Management Board receives reports on the channels’ effectiveness. We constantly use collected data and feedback to upgrade and improve complaint-handling mechanisms.
and integrity principles are also a key component of induction seminars for new employees. Each policy addresses stakeholders’ questions and monitors the effectiveness of stakeholders’ engagement by outlining our commitment to check the policy’s implementation and specifying grievance mechanisms that allow us to check their effectiveness and obtain feedback. The Chief Compliance Officer is the central systematic channel for handling complaints at the Krka Group level. Compliance officers must keep complainants informed about the status and outcome of their reports throughout the complaint-handling process. We prioritise dialogue and consultation with complainants as a means to achieve mutually agreed solutions. We have zero-tolerance policy for human rights violations, which is also one of our targets detailed in S1-5 – Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities.
We have no unified, additional comprehensive system at the Krka Group level for recording and analysing all reports received via all available channels. When an employee identifies a potential compliance, integrity, or mobbing violation, they are directed to the compliance officer or the harassment officer to file a report. Employee satisfaction surveys do not currently address satisfaction with the performance of grievance mechanisms and procedures. Protecting individuals against retaliation is set out in Krka’s Code of Conduct, presented in more detail in ESRS G1, Disclosure Requirement G1-1 – Business conduct policies and corporate culture.
A positive working environment stimulates motivation, productivity, and employee satisfaction, contributing to good business performance. Qualified and motivated employees are key to a successful business, competitiveness, and the long-term stability of our business model. Material risks involve shortages of qualified workers, which may impact the company’s operational efficiency and competitiveness, and employee turnover, which can arise from shift work or increased competition for skilled professionals, affecting production process stability and employment costs.
When identifying these risks, we also recognise opportunities to improve the working environment and competitiveness. Investments in employee training and upskilling lead to increased productivity and long-term stability of human resources. Optimising work conditions, including flexible work arrangements and a positive working environment, reduces employee turnover and increases employee engagement. Process digitalisation and automation enhance operational efficiency, lessen physical strain on employees, and help attract new talent. High occupational safety standards improve employee health and reduce the likelihood of negative impacts on employee health, safety, and well-being, contributing to a stable working environment. Targeted awareness campaigns and employee training reduce the likelihood of occurrence of negative impacts related to health and safety of employees.
To reduce risks and pursue opportunities, we make strategic investments in the training and development of our employees, including training in line with national vocational qualification programmes for the pharmaceutical industry. These actions reduce the identified impacts and risks, increase positive impacts, and contribute to pursuing opportunities for strengthening our workforce. The actions apply to the entire Krka Group, except where a specific reference is made that the adopted action applies only to the controlling company.
| Indicator | Value in 2024 |
|---|---|
| 5,222 | All employees every two years | Annual | Annual monitoring of training participation. |
|---|---|---|---|
| To inform all employees about sustainability, corporate compliance, and human rights. |
| 10,257 | Average training hours per employee | 43.8 hours | 40 hours | Annual | Annual monitoring and recording of hours of training, annual reporting to Human Resource Committee. |
|---|---|---|---|---|---|
| Lifelong learning to contribute to successful work, career advancement, professional development, and personal growth. |
| 14% | ≥10% | Annual | Follow-up based on Krka appraisal interviews, potential assessment, development interviews, and review of human resource records on key and promising employees. |
|---|---|---|---|
| Annual reports to Human Resource Committee. | |||
| Early identification of key and promising employees and their development are important to strengthen the company’s internal potential and plan succession. |
| 0.44% | 0.35–0.5% | Annual | Annual training budget review relative to revenue. |
|---|---|---|---|
| Planned investment in employee training embodies our systematic employee training and development approach. |
| Indicator | Value in 2024 | Target value | Timeframe | Methodology to monitor progress | Note |
|---|---|---|---|---|---|
| Cases of fraud, corruption, corporate non-compliance, unethical, unprofessional or unlawful conduct by employees | 0 | 0 | Annual | Case oversight by Chief Compliance Officer. | Prevention of fraud, corporate non-compliance, corruption, unethical, unprofessional or unlawful conduct by employees. |
| Indicator | Value in 2024 | Target value | Timeframe | Methodology to monitor progress | Note |
|---|---|---|---|---|---|
| Cases of human rights violations | 0 | 0 | Annual | Case oversight by Chief Compliance Officer. | Maintaining zero human rights violations in the company and its value chain. |
| Indicator | Value in 2024 | Target value | Timeframe | Methodology to monitor progress | Note |
|---|---|---|---|---|---|
| Total organisational climate score by engagement index | 3.8 (figure for 2023; applies also to 2024 and/or until the next organisational climate measurement) | ≥3.6 | By the end of 2025 | Organisational climate is measured by engagement index, ranging from 1 to 5. Biennial survey for all Krka Group employees, review of results, formulating action plans, follow-up. Reported to Human Resource Committee. | Organisational climate and employee satisfaction measurements are used to identify strengths, improve weaknesses, set sustainability strategies to recruit and retain good employees, and improve engagement, positive work environment, and well-being in the company. |
| Gender split (male-to-female ratio) | 40/60 | 40/60 |
|---|---|---|
| Share of female employees in management positions | 47% | 50% |
| Up to 2027 | Share of female employees in management positions. Monitoring the share of female employees in management positions, promoting gender equality in management. |
| Employee turnover | 12.6% | ≤20% |
|---|---|---|
| Annual | Ratio of the number of employees who left the company in 2024 to the number of employees on the last day of the reporting period. Talent retention to deliver on strategic orientations. |
| LTIFR | 3.41 | <5 |
|---|---|---|
| Annual | Number of workplace accidents resulting in three or more days’ absence from work per total number of hours worked, multiplied by 1,000,000. Indicator of the number of accidents resulting in absence from work for the Krka Group. LTIFR is the number of workplace accidents resulting in three or more days’ absence from work per total number of hours worked, multiplied by 1,000,000. |
| Number of fire drills | 109 | >45 |
|---|---|---|
| Annual | The number of fire drills. Evacuation and fire drills to ensure a proper response by Krka Group employees in emergency situations and improve employee safety. |
| Hours of training in occupational safety and health | 20,965 |
|---|---|
The number of hours of training: 10,000
Training in occupational safety and health and fire safety to ensure a safe working environment in the Krka Group.
Human Resources proposes and Krka’s Management Board approves the strategy, policies, targets and activities related to own workforce. The Supervisory Board also approves the targets set out in the Krka Group Development Strategy. The Human Resource Committee monitors and oversees key targets and activities related to own workforce, while the Sustainability Committee receives information about the progress with ESG targets. The Worker Director, representing employees, also sits on the Human Resource Committee.
The members of the Works Council discuss the employment plan, working time report, and all changes in job organisation and classification at their regular meetings. Annual reporting to the members also addresses activities related to human resource management, training, human resource development, working hours, health care, and employment of people with disabilities. Separate reports on occupational safety and health activities and situation are prepared.
The Management Board adopts key occupational safety and health targets and programmes and oversees their implementation. Occupational safety and health workgroups operate in organisational units and production sites, facilitated by an authorised, certified HSW officer from Safety and Health.
Methodology and assumptions: The data refer to the number of employees on the last day of the reporting period (31 December 2024) and represent the actual number of employees. The data were obtained from the internal human resource system and are managed by human resource employees in each market. Employee numbers are broken down by country, gender, and employment type (temporary and permanent employment). The data reflect a specific point in time rather than a long-term average and do not include methodological adjustments or estimations. Data on contract type comply with the national definitions and laws.
Methodology limitations: The employee count does not account for changes in employee numbers in 2024. Gender self-reporting is subject to the national legislation of each country where the company operates. In most countries, it is not possible for persons to legally register themselves as having a third, often neutral, gender, which is categorised as other, limiting related reporting.
External verification: The metrics have not been verified by an external body.
| Country | Number of employees (head count) |
|---|---|
| Slovenia | 7,588 |
| Russian Federation | 1,862 |
The Krka Group has 12,810 employees, 1,281 of whom represent 10% of the total number of employees.
| Gender | Number of employees (head count) |
|---|---|
| Male | 5,098 |
| Female | 7,712 |
| Employee total | 12,810 |
| Female | Male | Other* | Not disclosed | Total | |
|---|---|---|---|---|---|
| Number of employees (head count) | 7,712 | 5,098 | 0 | 0 | 12,810 |
| Number of permanent employees (head count) | 6,751 | 4,557 | 0 | 0 | 11,308 |
| Number of temporary employees (head count)** | 961 | 541 | 0 | 0 |
| 1,502 | Number of non-guaranteed hours employees (head count) |
|---|---|
| 2 | Number of full-time employees (head count)*** |
| 0 | Number of part-time employees (head count)*** |
**In some instances, employees are initially offered temporary employment during the induction period in accordance with the national legislation. After the induction period, they are usually offered permanent employment, depending on labour requirements. Temporary employment is also used to cover long-time absences.
*** Data on the number of full-time and part-time employees or full time equivalent (FTE) are not reported separately. These breakdowns are voluntary and not included in our disclosures.
Total number of employees who have left the undertaking during the reporting period and rate of employee turnover in the reporting period
| Unit | 2024 |
|---|---|
| Number of workplace exits | 1,618 |
| Turnover rate | 12.6% |
Methodology and assumptions: Total turnover rate is expressed as a percentage and calculated using the following formula: (numerator (number of workplace exits in 2024)/denominator (number of employees as at 31 Dec 2024)) x 100
Denominator (number of employees as at 31 Dec 2024): The number of all Krka Group employees as at 31 December 2024, as reported in the Annual report. No averages are used in the calculation.
Numerator (number of workplace exits in 2024): Total number of employees who left the company in 2024 voluntarily or due to dismissal, retirement, or death in service. Internal transfers between Krka Group units are not included (as they could be seen as a workplace exit in one unit and a new hire in another). Workplace exit day refers to an employee’s final day at the workplace.
All data for the calculation (numerator and denominator) are obtained from the internal human resource system and managed by human resource employees.
Methodology limitations: The number of employees in the numerator does not reflect the changes in the number of employees in 2024. The calculation factors in the number of employees at the end of the reporting period.
External verification: The metric has not been verified by an external body.
Name of metric: Employee turnover.
Unit: Percentage.
The reported information is also provided in the ‘Financial report’ under the ‘Notes to consolidated financial statements’ (‘31. Profile in the Krka Group’).
Working conditions and terms of employment of our employees in the European Economic Area (EEA) are partly determined or influenced by collective bargaining agreements and national legislation. Employees participate in social dialogue through workers’ representatives and Works Councils at the unit level.
Collective bargaining agreements cover 64.5% of Krka Group employees.
| Coverage rate | Employees – EEA (for countries with >50 empl. representing >10% of total empl.) | Employees – Non-EEA (estimate for regions with >50 empl. representing >10% of total empl.) | Workplace representation (EEA only) (for countries with >50 empl. representing >10% of total empl.) |
|---|---|---|---|
| 0–19% | / | / | / |
| 20–39% | / | / | / |
The Krka Group’s top management consists of key management workers who play a crucial role in shaping and executing corporate strategy. These top positions in the corporate hierarchy set guidelines and drive the achievement of strategic objectives. The Krka Group’s top management includes the Management Board and directors within the company (directors who manage sectors, heads who supervise independent departments, and directors who manage representative offices and subsidiaries).
| Gender | Number of employees | Share (%) |
|---|---|---|
| Female | 27 | 47 |
| Male | 31 | 53 |
| Total | 58 | 100 |
| Age group | Number of employees | Share of employees (%) |
|---|---|---|
| Under 30 years old | 2,209 | 17.24 |
| 30–50 years old | 8,324 | 64.98 |
| Over 50 years old | 2,277 | 17.78 |
| Total | 12,810 | 100.00 |
The data present top management composition by gender and employee age distribution on the last day of the reporting period (31 December 2024). Data are obtained from the internal human resource system and managed by human resource employees.
Gender distribution at top management: The disclosure specifies the number and percentage of women and men at top management level.
Employee age distribution: Employees are distributed into three age groups, i.e. under 30 years old, 30 to 50 years old, and over 50 years old. The disclosure relates to the absolute number of employees and the share of each age group. The data reflect the human resource structure at a given point in time rather than trends or changes over time.
Methodology limitations: The disclosed data do not reflect changes over time; they reflect the situation on a certain date. In some countries, gender data may be restricted by national legislation, recognising only two genders. Age composition adheres to pre-set age groups, which might not accurately reflect demographic differences in the workforce.
External verification: The metric has not been verified by an external body.
Name of metric: Diversity metrics (top management diversity and employee age distribution).
Unit: Number of employees (head count), Share (%)
All Krka Group employees are paid an adequate wage. An adequate wage means a wage that meets the needs of a worker and his/her family and a decent standard of living in the light of national economic and social conditions. We also adhere to national collective bargaining agreements, where adopted.
employees (100%) in subsidiaries are covered by the occupational safety and health management system in line with the national legislation and corporate recommendations (Instructions for managing occupational safety and health in subsidiaries and representative offices of Krka abroad). The system is subject to internal audits. We have progressively implemented uniform guidelines that consider internal instructions, safety documents and occupational safety and health policies.
In 2024, there were no fatalities as a result of work-related injuries and work-related ill health in Krka Group employees or external service providers working on our sites. These data are not monitored or recorded for other value chain workers.
In 2024, we recorded 100 accidents at the Krka Group. All were minor and involved knocks, cuts, and slips. The rate of recordable work-related accidents in 2024 was 4.88.
We recorded one case of work-related ill health at Terme Krka, a part of the Krka Group. We reviewed risk assessments for similar job positions and proposed precautionary organisational actions.
At the Krka Group, there were 2,091 days lost to work-related injuries and no fatalities from work-related accidents, work-related ill health and fatalities from ill health in 2024.
Policies and records for agency workers are aligned with those for Krka Group employees. Our data disclosures take into account agency workers.
Health and safety metrics are obtained from internal IT systems or surveys for subsidiaries and representative offices. Assumptions were used to determine the number of days lost to work-related injuries. Other metrics involve no assumptions. The metrics have not been verified by an external body. To consider all calendar days, rather than just working days, when determining the number of days lost for 2024, the number of actual working days lost was increased by the ratio of non-working days to working days presented in the 2024 work calendar of the controlling company. Considering the above-mentioned assumption, the calculation of days lost includes non-working days per the standard. Days lost include days lost to work-related injuries that occurred in 2024.
Methodology and assumptions: Gender pay gap is calculated as the difference of average gross hourly rate between male and female employees, expressed as the percentage of the average gross hourly rate of male employees. The calculation includes all Krka Group regular employees as at 31 December 2024 and is based on the average gross hourly rate of male and female employees, calculated from total employee remuneration. The calculation of gender pay gap relies on the purchasing power index by countries based on International Monetary Fund data on gross domestic product based on purchasing power parity (PPP) for 2024 (current prices) for countries where Krka has its subsidiaries and representative offices. The metrics are calculated on the basis of the purchasing power parity index for Slovenia (Slovenia = 100).
Methodology limitations: The differences in positions, work experience or educational level, which might affect the results, are not taken into consideration in the calculation. Statistical analysis does not necessarily reflect gender equality or inequality because not all factors are considered that affect the differences in the average hourly rate.
External verification: The metric has not been verified by an external body.
| Name of metric | Unit | Metric | Value | Note |
|---|---|---|---|---|
| Gender pay gap | Share (%) | Krka Group gender pay gap | 12% | At the Krka Group level, female employees’ average gross hourly rate is 12% lower than that of male employees. |
| Gender pay gap for Krka, d. d., Novo mesto in Slovenia | –0.3% | In Slovenia, female employees’ average gross hourly rate is 0.3% higher than that of male employees. |
Gender pay gap at Krka, d. d., Novo mesto in Slovenia is highlighted because the Krka Group has the highest number of employees in Slovenia and because the value is negative.
Methodology and assumptions: Remuneration ratio is calculated as the ratio of the annual gross remuneration of the highest paid individual to the median Krka Group employee annual gross remuneration, excluding the highest paid individual. The remuneration payment period from 1 January to 31 December 2024 was considered. The calculation included employees on the company’s payroll as at 31 December 2024.
In accordance with the standard, the calculation considered the following types of remuneration: base salary, allowances, bonuses, Christmas bonus, company performance bonus and other forms of variable remuneration, compensations, other allowances, supplementary health and pension insurance, perks, and benefits in kind.
The calculation of the ratio of the remuneration of the highest paid individual to the median total remuneration of employees relies on the purchasing power index by countries based on International Monetary Fund data on gross domestic product based on purchasing power parity (PPP) for 2024 (current prices) for countries where Krka has its subsidiaries and representative offices. The metrics are calculated on the basis of the purchasing power parity index for Slovenia (Slovenia = 100).
Methodology limitations: The differences in positions, work experience, and educational level are not taken into consideration in the calculation.
External verification: The measurements have not been verified by an external body.
| Name of metric | Unit | Metric | Value |
|---|---|---|---|
| Ratio of the remuneration of the highest paid individual to the median total remuneration of employees | Ratio | 39.84 |
There were no incidents of discrimination, including harassment, reported in the reporting period. No complaints were filed through channels for people in the undertaking’s own workforce to raise concerns or complaints to the National Contact Points for OECD Multinational Enterprises in the reporting period. There were no fines, penalties, or compensation for damages due to the incidents and complaints disclosed in the reporting period. There were no severe human rights incidents connected to the undertaking’s workforce in the reporting period, nor were there fines, penalties, and compensation for damages due to such incidents.
To manage material impacts related to value chain workers, we have implemented several key policies, including the Due Diligence Policy of the Krka Group, the Human Rights Policy of the Krka Group, the Environmental Policy of the Krka Group, and the Code of Conduct for Business Partners of the Krka Group. We will adhere to these documents when upgrading our sustainability management practices related to the establishment of human rights and natural environment due diligence processes and activities planned for 2025. These policies cover all value chain workers rather than specific groups. Owing to the specificities and strict regulations in the pharmaceutical industry, in which we operate, we closely monitor integrated quality management; the quality, safety and efficacy of medicines and active ingredients; legislative and regulatory compliance; and fair marketing and sales practices. That is why we regularly screen our suppliers and intend to upgrade the due diligence processes to align with the Corporate Sustainability Due Diligence (CS3D) Directive. We are committed to applying the principles of the above-mentioned policies to increase our material impacts related to value chain workers and prevent the occurrence of material negative impacts. These issues are related to corporate integrity, human rights, natural environment protection, and ensuring uninterrupted supply chain operations, which positively impact our ability to ensure uninterrupted supply of quality, safe and effective products.
The Policy reflects our commitment to appropriate identification, prevention, mitigation, and remediation of adverse impacts on the social and natural environment, as well as their appropriate handling. It is designed to ensure an effective and systematic review of business operations, processes, and activities in compliance with applicable legislation, internal rules, and other documents, as well as quality and safety standards, with a focus on respecting human rights and protecting the natural environment throughout the entire value chain. The Policy aims to prevent fraud, detect irregularities, improve risk management – particularly in human rights and natural environment protection – and ensure integrity. Due diligence helps companies better define and manage business and operational risks, identify opportunities to reduce costs, improve understanding of markets and strategic supply sources, and reduce the likelihood of incidents related to the areas covered by the OECD Guidelines for Multinational Enterprises, as well as exposure to systemic risks. The Due Diligence Policy forms the basis for establishing due diligence procedures throughout the value chain.
Besides our strategic commitment and responsible business conduct, the Policy defines (1) our approach to identifying human rights violations and adverse impacts on the natural environment, (2) our commitment to prevent, mitigate or remediate the violations and adverse impacts, (3) our commitment to upgrade the system for monitoring the effectiveness of Krka’s policies and measures, as well as reporting on impact management, (4) the grievance mechanism that our stakeholders can use to report suspected violations of our policies and commitments to respect human rights and protect the natural environment, and (5) the responsibility to implement the Policy.
We promote adherence to the commitments set out in the Policy throughout our value chain operations. The Policy is binding not only in the controlling company, but also in all Krka Group subsidiaries. We encourage our business partners to adhere to internationally recognised standards, our commitments, and principles associated with respect for human rights and natural environment protection. The member of the Management Board responsible for compliance and the Chief Compliance Officer are tasked with overseeing the implementation of due diligence processes.
The Code of Conduct for Business Partners of the Krka Group is a commitment to implementing environmental, social and governance principles and promoting their integration in business processes across the entire value chain, from suppliers (upstream) to direct customers (downstream). The Code summarises the principles of ethical and sustainable business practices that we expect from our business partners. We understand that we can only deliver on our long-term business and sustainability goals through collaboration with our partners. Together, we contribute to achieving global sustainability goals, particularly in areas such as human rights and natural environment protection. Guidelines and other instruments covering those two areas form the cornerstone of the Code. The Code of Conduct for Business Partners of the Krka Group outlines the framework of principles and expectations for Krka’s business partners, in particular concerning: (1) human rights, workers’ rights, and fair employment practices, (2) health and safety, (3) environmental compliance, sustainability, and goals, (4) ethical conduct, and (5) governance and management systems. The Code of Conduct for Business Partners of the Krka Group addresses material impacts related to sustainability topics across natural and social environments and corporate governance concerning value chain workers. Krka’s Management Board is responsible for implementing the Code.
The Human Rights Policy of the Krka Group is described in ESRS S1, Disclosure Requirement S1-1 – Policies related to own workforce. The Policy serves as a foundation for assessing impacts and potential human rights violations in the due diligence process.
The Environmental Policy of the Krka Group is described in ESRS E1, Disclosure Requirement E1-2 – Policies related to climate change mitigation and adaptation. The Policy serves as a foundation for assessing impacts and possible violations related to natural environment protection in the due diligence process.
Relevant policies and documents are based on:
In 2024, no instances of non-compliance with the guidelines, declarations and principles were reported. The policies and other documents are published on Krka’s corporate website and the Krkanet intranet portal.
A grievance mechanism is in place. It allows involved or affected stakeholders to report suspected irregularities to [email protected]. The grievance mechanism is detailed under Disclosure Requirement S2-3 – Processes to remediate negative impacts and channels for value chain workers to raise concerns.
The company has no particular procedures for engaging with value chain workers or their representatives. In 2025, we will begin upgrading the due diligence process and begin work to ensure compliance with the Corporate Sustainability Due Diligence (CS3D) Directive.
We have established a grievance mechanism, as specified in the Code of Conduct for Business Partners of the Krka Group. Involved or affected stakeholders can report suspected irregularities to [email protected]. The Chief Compliance Officer considers the reports and assigns a dedicated working team for each case, involving relevant experts as needed. When a case is closed, corrective measures must be adopted if justified. Business partners must guarantee anonymity to reporters and protect them from any potential retaliatory actions. We encourage our business partners to adhere to the Code of Conduct for Business Partners of the Krka Group and establish channels that value chain workers can use to raise concerns. Value chain workers are not involved in monitoring and ensuring the effectiveness of the channels. We do not assess whether they are aware of or trust these structures or processes as a means to raise their concerns or needs and have them addressed. We have no direct policies in place to protect individuals (value chain workers) that use these structures or processes against retaliation.
In 2024, we adopted the Due Diligence Policy of the Krka Group and the Code of Conduct for Business Partners of the Krka Group, which directly or indirectly address value chain workers, their rights, and impacts related to them. We are introducing a new clause stipulating that our partners must receive information about our sustainability policy and the Code of Conduct for Business Partners of the Krka Group. The clause will apply to new contractual relationships, starting in 2025. The policies and other corporate documents demonstrate our commitment to strive to monitor the effectiveness of our policies and actions and take appropriate rehabilitation actions and actions to further prevent and mitigate adverse impacts if any deviations are identified. The procedures, findings and plans will be made publicly available in our annual report or through other means of communication with the public, while respecting business confidentiality and other competitiveness and safety considerations.
We have not yet implemented additional actions, so we are unable to track or assess their effectiveness. Currently, we do not have processes in place through which we identify the necessary and appropriate actions in response to a particular actual or potential negative impacts on value chain workers.
Actions planned for 2025 and beyond and related activities and approaches to managing material impacts associated with value chain workers will be geared towards identifying human rights violations and adverse impacts on natural environment and remaining committed to preventing, mitigating or remediating such violations and adverse impacts. We anticipate that the fully integrated due diligence process will allow us to more effectively identify impacts, risks and opportunities associated with value chain workers, improve and expedite our response and adoption of actions to remediate negative impacts if actual negative impacts are identified, reduce the likelihood of occurrence of potential negative impacts, and properly manage any potential material risks that might arise. Due diligence will follow a risk-based approach, initially focusing on material direct partners in the upstream value chain from geographical areas where human rights violations and violations related to natural environment protection are more likely to occur.
We plan to upgrade the due diligence process and align it with the Corporate Sustainability Due Diligence (CS3D) Directive. To this end, we will set up a working group in 2025, comprising different organisational unit representatives, for example, quality management, production, technical purchasing, purchasing, corporate performance management, and finance. We expect all our business partners with whom we engage with to align with the due diligence requirements, laws, and ethical norms that we follow and set out in our policies and other umbrella documents. We endeavour not to engage in any business activities that might give rise to tensions between preventing or mitigating material negative impacts and other business pressures.
In 2024, no information, complaints or severe human rights issues or incidents connected to our upstream and downstream value chain were reported.
We have not adopted targets related to managing material negative impacts and advancing positive impacts on value chain workers yet. That is why we do not fully track the effectiveness of our policies and actions associated with material sustainability impacts related to value chain workers.
signals, and benefits and risks related to a medicine); medicine-related risk management system; complaint and recall management system for handling deviations; and patient communication system for considering patient enquiries.
Policies and other regulations closely linked to managing material impacts, risks and opportunities related to consumers and end-users as defined in ESRS 2 SMB-3 include the Quality Manual and Krka’s Code of Promotion.
The Quality Manual is the key document of Krka Group’s quality management system. It complies with the requirements of ISO 9001, ISO 14001, ISO 45001, ISO/IEC 27001, and ISO 22301 standards, and GxP and HACCP guidelines. Every year, we publish a revised Quality Manual to progress toward the objectives outlined in the policies adopted by the Management Board. The Manual is a fundamental document that applies similar underlying principles to various aspects of business operations, for example, quality, the environment, occupational health and safety, food safety, information security, and business continuity, in a uniform management system. The Quality Manual, along with its accompanying documents and records, serves as the foundation for our operations, quality system improvements, and performance checks. We typically revise and supplement the Quality Manual annually or more often in exceptional circumstances (changes in responsibilities, organisational changes, etc.).
The Manual describes our product, process, and service quality management system, documenting its establishment, implementation, maintenance, and upgrades to our management systems. It complies with legal and other requirements and good practice guidelines in the pharmaceutical industry (GxP), responds to customer demands, and describes processes and their reciprocal impacts. It ensures the continued implementation of the quality policy, environmental policy, food safety policy, occupational health and safety policy, business continuity policy, information security policy, and sustainability policy. The Manual also raises awareness among employees to understand their roles, responsibilities, and duties within the management system.
The quality management system applies to Krka, d. d., Novo mesto, specifically to developing and producing prescription pharmaceuticals, non-prescription products, active ingredients, medical devices, feed additives, food supplements, and employer-provided employee meals. Krka Group’s Quality Policy, our framework document on quality, applies to the Krka Group. The Policy presents and defines our quality policy while complying with the relevant laws, good practices, and standards.
We consider potential negative impacts of our products on consumers and end-users, i.e. those related to adverse reactions of medicines, in precisely defined procedures for identifying safety signals and assessing the safety of medicines, as well as within our system for managing risks related to medicinal products as a part of our pharmacovigilance system. When a product is already on the market, the system is used to establish, evaluate, and respond to new findings on adverse reactions and other safety aspects of medicines. We employ a special system to process customer feedback and pursue constant internal improvements according to the PDCA (plan, do, check, act) principle to upgrade and improve processes and products.
The Quality Manual relates to material impacts, risks and opportunities associated with consumers and end-users as identified in ESRS 2 SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and business model. While the Manual applies to the Krka Group, we also use it in relationships with upstream and downstream stakeholders. The Code ensures that we deliver on quality objectives at all levels of Krka Group operations, including product quality.
Krka’s Management Board is the highest organisational level in the company responsible for implementing the Quality Manual and overseeing its effectiveness.
Krka’s Code of Promotion sets our promotional and non-promotional activities carried out by the Krka Group when marketing its products. Marketing activities by our subsidiaries must comply with national laws and regulations and applicable European, international and national medication promotion and marketing codes adopted by professional associations. The Code should be read and implemented by considering all other relevant rules. The Code specifies requirements for Krka’s marketing activities, particularly regarding prescription pharmaceuticals and engagement with the healthcare community, including health professionals, healthcare organisations, patients, and patient societies. These requirements of the Code apply, as appropriate, to the marketing of other products. We may adopt stricter and more detailed internal rules on matters covered by the Code. By adopting the Code, we affirm our commitment to ethical standards when conducting marketing activities and to uphold fundamental principles fostering good governance in the pharmaceutical industry, including integrity, respect, responsiveness, accountability, collaboration, and transparency. All Krka employees must adhere to the Code and align their product promotion or dissemination of product information with the Code. The principles set in the Code are binding and must be adhered to by all Krka subsidiaries and representative offices.
Documents used as a reference in drafting Krka’s Code of Promotion include Krka’s Code of Conduct, Medicines for Europe Code of Conduct, Rules on Fraud Prevention, Detection and Investigation, Directive 2001/83/EC of the European Parliament and of the Council of 6 November 2001 on the Community code relating to medicinal products for human use, as amended, Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation).
Krka employees and all marketing and sales personnel are responsible for ensuring that information is correct, accurate, and relevant, in line with summaries of product characteristics, and that all their activities align with all applicable rules. Marketing managers in each market must ensure that all their marketing activities comply with all applicable rules. Directors or executive directors of subsidiaries and representative offices are responsible for ensuring that all their activities (including disclosures of transfers) comply with all applicable rules.
The Code relates to material impacts, risks and opportunities associated with consumers and end-users as identified in ESRS 2 SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and business model. It applies to our operations and business relationships in the downstream value chain. It ensures compliance with and application of appropriate marketing practices. Krka’s Management Board is the highest organisational level in the company responsible for implementing Krka’s Code of Promotion and overseeing its effectiveness.
In 2024, Krka adopted the Code of Conduct for Business Partners of the Krka Group (see ESRS S2-1 – Policies related to value chain workers), which sets out our expectations towards business partners in terms of product quality, patient safety, access to information, and marketing practices.
The documents cover respect for the human rights of consumers and end-users, engagement with them, and actions to provide and/or enable remedy for human rights impacts.
The Human Rights Policy of the Krka Group identifies product quality, patient safety and accessible healthcare as our priority areas. Ensuring the availability of medicines is a cornerstone of our social responsibility. We support everyone’s right to health and believe that quality treatment should be accessible to all, regardless of where they live and their circumstances. We strive to provide broad and timely access to our medicinal products at affordable prices, allowing everyone to live by our slogan ‘Living a healthy life’.
The Code of Conduct for Business Partners of the Krka Group sets out that we expect our business partners to operate ethically and comply with applicable laws and regulations. It also highlights the need to ensure patient safety and access to information. Business partners must comply with applicable laws, regulations, and guidelines on good pharmacovigilance practices to ensure the proper and timely collection of safety information and reporting adverse drug reactions. We expect them to have appropriate management systems in place to minimise the risk of patient rights violations, including their rights to health and access to information, and to hold all necessary sales and marketing permits and licences.
We expect our business partners to provide high-quality, safe, and effective products and services that fully comply with contractually agreed standards, applicable laws, and other regulations. This means that business partners involved in the supply, manufacture, packaging, repackaging, testing, storage, and distribution of materials or products for Krka or on its behalf must ensure compliance with relevant quality regulations and GxP good practices. We expect our business partners to refrain from participating in any activity that supports the illegal trade of medicines, to notify us if there is suspicion of illegal trading, and to provide reasonable assistance in the investigation. They should have measures in place to ensure the authenticity of products from origin to destination (from the first to the last stage of the value chain), including maintaining procedures and records that ensure traceability (among other things) of finished products, waste, surplus, and returned and discarded products. All data related to the supply of materials, products, or services to Krka must be accurate, controlled, protected against manipulation or loss, and compliant with all data integrity standards.
The human rights of consumers and end-users may be affected by deviations in product quality. Remedy in such cases is described in standard operating procedures for handling complaints and recalls. Consumer and end-user rights may also be affected by the temporary non-availability of certain medicines, supply delays, and medicine shortages. We have appropriate mechanisms in place to ensure the timely provision of our medicines. This includes analysing the market and assessing consumer and end-user needs to adjust purchasing and manufacturing plans while carefully managing inventory levels. Consumer and end-user rights may also be affected by inappropriate marketing practices. We manage those risks by complying with stringent statutory requirements and Krka’s Code of Promotion provisions.
In line with stringent European and national laws, we may not directly address consumers and end-users (patients) of prescription pharmaceuticals, meaning we can engage with them indirectly through health professionals who represent their interests, know what they want and need, and prescribe and dispense medicines. We also respond to concerns that consumers send us through various channels (see ESRS 2 S4-2 – Processes for engaging with consumers and end-users about impacts). In line with the relevant laws, we may address users of non-prescription products and food supplements through advertising.
A grievance mechanism is in place. Our stakeholders can report any concerns, suspected unlawful behaviour or violations of the Human Rights Policy of the Krka Group and/or Code of Conduct for Business Partners of the Krka Group via e-mail to [email protected]. The Chief Compliance Officer investigates the reports and assigns a working team for each case, engaging relevant experts as needed. We guarantee anonymity to reporters and safeguard them from any potential retaliation. When a case is closed, we adopt corrective actions if justified. We also expect our business partners to have complaint mechanisms in place.
Krka signed the Commitment to Respect Human Rights in Business Operations, a part of the National Action Plan of the Republic of Slovenia on Business and Human Rights, obliging us to respect the Universal Declaration of Human Rights, International Covenant on Civil and Political Rights, International Covenant on Economic, Social and Cultural Rights, UN Guiding Principles on Business and Human Rights, OECD Guidelines for Multinational Enterprises, ILO Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy, ILO Declaration on Fundamental Principles and Rights at Work, ILO conventions, National Action Plan of the Republic of Slovenia on Business and Human Rights, and other applicable guidelines and principles. We encourage respect for human rights and environmental protection throughout the value chain. We encourage our business partners to adhere to internationally recognised standards, our commitments, and principles. Further information is available in Due Diligence Policy of the Krka Group, outlined under ESRS S2, Disclosure Requirement S2-1 – Policies related to value chain workers.
No instances of non-compliance with the UN Guiding Principles on Business and Human Rights, ILO Declaration on Fundamental Principles and Rights at Work or OECD Guidelines for Multinational Enterprises were reported in the downstream value chain.
In line with the laws, we may not directly address consumers and end-users of prescription pharmaceuticals. However, we may inform them about our non-prescription products and food supplements by advertising in public media.
We make product information readily available to consumers and end-users in patient information leaflets included in each folding box and published on our corporate website, available in 31 languages. In certain markets, we communicate with consumers and end-users by providing information about various diseases on the websites of professional associations sponsored by Krka.
Consumers and end-users can communicate with us through various channels. They can use an electronic form available on the controlling company’s website and the websites of our subsidiaries and representative offices. A responsible person designated for each market responds to their queries. They can also contact us through a helpline.
We cooperate in product development, production, sales and marketing with various institutions, health insurance companies, and other bodies dealing with medicinal and other Krka products. We comply with all prescribed procedures, ensuring that our documents are up-to-date and reliable. To this end, we execute our procedures properly and maintain systematically organised, transparent, and complete documentation.
We are actively involved in developing a professional, scientific and regulatory environment by participating in various professional and industry associations in Slovenia, the European Union, and other countries.
Advertising of pharmaceutical products is subject to strict regulation and control. In 2024, no justified complaints were received regarding non-compliance of marketing activities with regulations and ethical standards. We foster transparent and traceable relationships with medical professionals. Information on financial transactions made to health professionals is published on our website.
We engage with health professionals, i.e. doctors, pharmacists and veterinarians, who advise, prescribe and dispense our medicines. Our engagement includes providing product information directly through medical representatives or remote channels (via e-mail, regular mail, and professional websites), hosting and supporting educational events, occasionally organising advisory board meetings, and occasionally supporting clinical research. We strictly adhere to national and international legislation, internal policies, and codes during these activities.
We carefully follow the development of medical, veterinary and pharmaceutical guidelines, and treatment and self-treatment principles to assess the needs of consumers and end-users. We occasionally hold advisory boards to verify with health professionals whether our development and marketing activities are appropriate. The frequency of advisory board meetings and clinical research depends on the dynamics of development and marketing activities related to a certain product.
Indirect customers (health professionals) who prescribe, recommend, and dispense our products include doctors, veterinarians, and pharmacists. We regularly inform them about our products, enabling them to make informed decisions about which products are most suitable for their patients and other users. We maintain direct contact with them in 42 countries and provide them with information in printed or electronic form. Whenever we communicate with health professionals, we act responsibly and in accordance with the applicable laws and other regulations on business operations, including regulations on product marketing and personal data protection. We also comply with good business practices, Medicines for Europe’s recommendations, Krka’s Code of Promotion, and national laws that impose more stringent obligations.
We contribute to the professional development of doctors, pharmacists and veterinarians by holding and supporting professional and educational meetings where they can build on their know-how, learn about new guidelines, exchange opinions and experiences. Meetings occur in various countries where Krka’s products are available and are organised as in-person, online, or hybrid events. Physicians and pharmacists can access educational information on our thematic websites, which we constantly upgrade. In 2024, we launched web portals for health professionals in Spain, Hungary, Czechia, Bosnia and Herzegovina, Serbia, Romania, North Macedonia and the United Kingdom to complement the existing Slovenian, Croatian, Polish, Slovak and Lithuanian versions.
Our medical representatives regularly undergo professional training so they can inform health professionals about the latest treatment guidelines and provide accurate and current information about different therapeutic classes and our products. We prioritise their comprehension and adherence to ethical standards, standards of work, legal requirements, and other regulations, alongside ensuring their proficiency in effective communication skills. We regularly test their expertise.
Feedback and opinions obtained through daily contact and independent market research are important in providing high-quality, safe and effective medicines and active ingredients.
Direct customers include distributors, pharmacy chains, hospitals, and pharmaceutical companies. We screen them in due diligence review based on available information about their operations on a certain market, their market potential, products of interest, economic viability, and feasibility of engagement. We only engage with customers who pass the screening process. Approval is granted only after they provide evidence of fulfilling legal requirements to market medicinal products.
We have mutual communication channels in place that help us swiftly and systematically identify aspects crucial for customers and focus on them to maximise their satisfaction with our products and services. We maintain direct and regular engagement with our direct customers, actively addressing their suggestions and requests while adjusting communication frequency based on business needs and the level of engagement required. We communicate either at their initiative or ours – several times a week or month or, in some cases, only a few times a year – always guided by the core values of the Krka Group, particularly partnership and trust.
We regularly conduct annual online satisfaction surveys among our direct customers to determine their general satisfaction level, satisfaction with our products, sales personnel, order processing and fulfilment, and complaint procedures. The key indicator is the Customer Satisfaction Index (CSI), detailed further in S4-5 – Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities. Respondents ranked strong business relationships with Krka, sales team responsiveness, and order fulfilment as the most important factors. These aspects received average scores exceeding 9, while other areas of customer satisfaction also scored highly. To foster trust, we share survey results and key findings with our direct customers. CSI calculation is not validated by an independent external body.
We engage with health professionals in all product development phases. In the early development phases, we collaborate in bioequivalence studies and later in advisory boards and pre-clinical, clinical, and post-registration research. The frequency of these activities depends on the dynamics of development and marketing activities related to a certain product.
Engagement with end-users in the case of patient-reported adverse reactions is set out in the standard operating procedure on pharmacovigilance, aligned with the relevant legislation. Customer engagement is aligned with business and statutory requirements. Our sales process with existing direct customers is built on two-way communication and includes coordinating business terms, planning sales requirements and volumes, and executing sales. We also provide support services such as coordinating and implementing marketing activities, as well as supplying price lists, catalogues, and sales data. Well-structured procedures for handling complaints, recalls, and other responses also play a crucial role.
Engagement with health professionals in development activities is addressed in the controlling company’s guidelines for advisory board work and involvement in clinical research and managed and supervised by the medical director. Other departments and bodies of the company, i.e. the Development Committee and Quality Committee chaired by the CEO, are also involved in this process, while directors of subsidiaries and representative offices, marketing and sales managers, and the compliance officer have responsibility for these tasks in the markets. In the controlling company, responsible persons appointed for individual markets or partners work with direct customers. Responsible persons with a sales role in the subsidiaries are also involved in these tasks in the markets.
We evaluate the effectiveness of our response to consumer and end-user needs by analysing our sales performance and attained market shares following new product launches, comparing our results with competitors and conducting customer satisfaction surveys.
The use of medicines in particularly vulnerable groups (children, pregnant women, people with special conditions/illnesses) is separately described in patient information leaflets to ensure their safety. If special risks are identified, we provide additional educational materials for healthcare professionals and/or patients and special risk minimisation programmes.
The general approach to and processes for providing remedy in cases of material negative impact on consumers and end-users is defined by laws and internal regulations. We adhere to the standard operating procedure for managing adverse reactions, identifying safety signals when such reactions are identified, and the complaint and recall management procedure if any deviation in product quality is established. These documents detail the processes, responsible persons, and deadlines for specific steps. Remedial procedures follow the PDCA principle.
Pharmacovigilance procedures are defined through a set of standard operating procedures designed to ensure that we obtain and evaluate all available information relevant to the safety of medicines, assess their impact, and take measures necessary to safeguard patient safety and promote public health. Any negative impacts related to medicines are managed in accordance with the standard operating procedure that outlines all safety measures applicable to Krka products in compliance with the legislation. A dedicated department within the company gathers and handles information on adverse drug reactions, reporting it to a single European platform. We regularly submit periodic safety update reports (PSUR) to regulatory authorities. If any safety signals are identified, we take appropriate actions based on the severity of adverse reactions. These may include updating product information (patient information leaflet and summary of product characteristics), notifying health professionals in writing, developing specific educational materials or programmes, or, if necessary, withdrawing the product from the market. Our SOP for the risk management system for medicinal products outlines proactive measures to minimise the likelihood of occurrence of negative impacts.
If we receive a complaint due to a quality-related deviation, we initiate the procedure specified in our SOP for received complaints about medicinal products. The responsible person for complaints and recalls or an authorised person in QA Solid Dosage Forms handles the complaints in a procedure aligned with the Medicines Act; good manufacturing practice guidelines as set out in EU GMP, Eudralex, Vol.4 – The Rules Governing Medicinal Products in the European Community, Part I, Chapter 8: Complaints and Product Recall; and Guidelines on Good Distribution Practice of Medicinal Products for Human Use.
Consumers, end-users, health professionals, direct customers and other actors may raise their concerns via specific channels we have put in place, including an electronic form, e-mail addresses, phone numbers and regular mail addresses, all published on our corporate website. Responsible persons regularly check the messages, forward any questions or concerns to qualified persons, swiftly draft appropriate responses, and send them to the sender via the same channel. This system is in place in the controlling company in Slovenia and all representative offices and subsidiaries abroad.
Regulatory authorities conduct thorough pharmacovigilance inspections of our adverse reaction management, medicine-related risk management, and all other pharmacovigilance activities. We coordinate business matters with our direct customers directly. Designated responsible persons for certain markets, partners or product groups handle communication via different channels, including phone, e-mail, and both online and in-person meetings.
In alignment with Disclosure Requirement ESRS S4-1 – Policies related to consumers and end-users, we have established a grievance mechanism that allows our stakeholders to make their concerns known, including those related to unlawful behaviour or violations. Ensuring the availability of communicating channels for consumers and end-users is essential to our company. They are specified in internal rules. The Code of Conduct for Business Partners of the Krka Group outlines our expectation that our business partners have governance and management systems in place to maintain these channels (see ‘Grievance mechanisms’ and ‘Response and remediation of adverse impacts’). The Code is detailed under ESRS G1-1 – Business conduct policies and corporate culture.
Key procedures to ensure patient safety address reporting adverse reactions, managing safety signals, conducting regular benefit-risk assessments of using medicines, and managing medicine-related risks. These procedures are regulated at the EU level, and we adhere to them rigorously. Competent authorities regularly oversee our compliance with the established procedures. Additionally, we have established a robust system for addressing concerns raised by consumers and end-users.
We evaluate the effectiveness of complaint procedures through the customer satisfaction survey, which evaluates multiple parameters. The key indicator is the response time from receiving direct customer’s question or concern to providing a substantiated response. In 2024, the satisfaction score for our response rate among direct customers was 9.18. Additional performance indicators include politeness in complaint handling (average score 9.53), providing complaint updates (average score 9.25), and actions taken in response to complaints (average score 9.10).
Consumers and end-users can access our contact information on our corporate website. The entire process for addressing questions and concerns is detailed in our manual on comprehensive handling of concerns raised by users of Krka products. The document outlines the procedure for receiving and addressing questions, concerns and complaints and preparing, sending, and recording responses to questions, concerns, complaints, and adverse reaction reports for medicines for human and veterinary uses. The manual does not deal with media-related issues; these are dealt with in a separate manual. The procedure aims to ensure that all issues and reports on adverse reactions are appropriately handled and documented and, in turn, achieve the required user satisfaction level, manage the risk related to medicine use, and improve product safety. Crisis communication procedures are outlined in a separate document.
Doctors, pharmacists, and veterinarians who prescribe and dispense medications are legally obligated to report adverse reactions. Our medical representatives always have the CIOMS form to hand when visiting health professionals. The form is used to report adverse reactions, and our representatives can give it to health professionals whenever necessary. Through our satisfaction survey, we regularly monitor various aspects of direct customer satisfaction with complaint procedures (communication, speed, politeness, actions). Feedback from direct customers reflects our consistently good performance in these areas. Health professionals receive information on adverse reaction management procedures through our medical representatives, who undergo regular training.
Information on policies to protect workers from retaliation is available under ESRS G1-1 – Business conduct policies and corporate culture (Addressing purported irregularities).
This section describes a set of actions to prevent or mitigate material negative impacts, promote material positive impacts on consumers and end-users, and manage material risks.
We ensure and promote regulatory compliance and commitment to high ethical standards. In the pharmaceutical industry, products and related services are strictly regulated because of their impact on end-users’ health. All our prescription pharmaceuticals and non-prescription products are tested and comply with all regulations. We market only products that have been approved and comply with relevant requirements and regulations. We implement health protection, safety, and patient and other end-user protection systems according to clear guidelines incorporated into our operations. Our risk management system related to these aspects complies with legal requirements and regulations. Our system for collecting information about risks to the health of patients or public health related to prescription pharmaceuticals and non-prescription products, scientific data evaluation, assessment of potentials for risk reduction and prevention, and the adoption of appropriate measures for the safe use of medicines comply with European legislation and regulations in other countries where Krka holds marketing authorisations.
Inappropriate marketing practices may pose risks. We avoid such risks by complying with Krka’s Code of Conduct and organising educational courses (see S4-1 – Policies related to consumers and end-users). We comply with the laws governing the promotion of pharmaceuticals and medical devices and are bound by high ethical standards. We adhere to Krka’s Code of Promotion, the Code of Conduct for Business Partners of the Krka Group, and many other internal rules (including a relevant check-list) to avoid inappropriate promotion of our products. We implement measures to prevent falsified medicinal products from entering the legal supply chain as per relevant standards and statutory requirements.
Our quality management system, compliant with ISO 9001, and procedures, aligned with ISO 14971, minimise the likelihood of failing to meet quality standards, thereby preventing potential negative impact on end-users’ health. Well-established protocols for addressing product-related errors are in place to prevent or mitigate harm to end-users. We ensure product safety by complying with good manufacturing practice (GMP) requirements and the Quality Manual. The quality of active ingredients, excipients, incoming materials and finished products is laboratory tested using state-of-the-art, validated analytical methods, devices and procedures.
We manage quality-related risks as per our Quality Manual (see S4-1 – Policies related to consumers and end-users) and SOP on quality risk management. We strive to manage risks across various business, process, and procedure management segments in the company that may impact the quality, safety, efficacy, and availability of products. Each medicine carries specific risks defined in the risk management plan, which is submitted to regulatory authorities as part of the marketing authorisation application or renewal process.
We prevent quality deviations by continuously supervising all production phases and ensuring that each product batch is released only after its quality has been confirmed. If a quality deviation is identified after a batch is released to the market, we strive to mitigate the consequences through an effective complaint and recall procedure, which is an integral part of our carefully designed complaint and recall system.
We have adopted different actions to prevent or mitigate negative impacts of unexpected serious adverse reactions on consumers and end-users, complying with the protocol prescribed in the rules on pharmacovigilance of medicinal products. We determine the type and intensity of an adverse reaction and, accordingly, make corrections to product information or take additional actions, for example, directly notify health professionals, develop educational materials, or run other programmes. Our pharmacovigilance system ensures the safety of our medicines for human and veterinary uses.
New adverse drug reactions in patients, such as serious adverse reactions identified after obtaining marketing authorisation (which could lead to a product withdrawal) or subsequently identified harm caused by a medicine’s ingredient, pose potential risks to a company. Therefore, we continuously monitor adverse reaction reports and other relevant data, identifying and assessing safety signals that may impact existing knowledge about a medicine’s safety. If new information emerges, we take appropriate actions to maintain an appropriate benefit-risk balance for the medication. These developments may also present an opportunity for the company if the identified risks pertain to competitor products rather than Krka’s.
We contribute to positive material impacts on consumers and end-users by swiftly developing, registering and launching new products that comply with the modern medical, pharmaceutical and veterinary doctrine and patient needs, by careful planning, by following medical, veterinary and pharmaceutical trends, by conducting R&D activities in relation to new products, and by manufacturing and launching new products directly after patent expiry to ensure that affordable medicines are available to a wide group of users as soon as possible.
We comply with new product manufacturing requirements and relevant laws by promptly introducing advanced technological processes to produce active ingredients and finished products. We have been increasing production capacities and improving the cost-effectiveness of processes in Slovenia and at our subsidiaries abroad. By controlling all product life cycle stages, we can adapt to market challenges more readily and effectively. We effectively integrate research and development with API and pharmaceutical production, enabling us to swiftly and smoothly transfer new products from development to regular production. In 2024, we accelerated technological problem-solving, optimised technological processes, and introduced many alternative sources of materials to ensure uninterrupted production and long-term volume growth. We prevent or mitigate medicine shortages through careful supply chain planning, ensuring adequate production capacity, swiftly adapting to unexpected product demand, establishing alternative production sites or organising alternative transport.
We indirectly identify consumer and end-user needs through our engagement with health professionals, by following expert insights presented in literature and at scientific congresses and by analysing the pharmaceutical market because, as per regulations, we may not directly engage with patients. Experts in New Products assess the identified opportunities. In this way, we can provide our consumers and end-users with new generic medicines and innovative single-pill combinations that add to the affordability of medicines and simplify treatment. We communicate promptly with our direct customers to align to their needs and conduct satisfaction surveys to assess their feedback systematically. Our approach follows the PDCA principle when analysing their concerns and assessments, ensuring a structured process for identifying opportunities related to direct customer needs; defining actions; and monitoring their effectiveness.
Detailed information about Krka products is regularly published on our product, corporate, and thematic websites and is available in over 30 languages. We are developing digital media and tools in certain therapeutic areas to help users alleviate symptoms.
In 2024, no instances of non-compliance concerning product information were identified.
The above-mentioned action set ensures that consumers and end-users are protected against potential negative impacts of adverse reactions, deviations in quality, medicine shortages or inappropriate product information. These actions are part of our ongoing business practice and relate to our own operations, product sales, and marketing activities in the downstream value chain. Managing material impacts, risks and opportunities is also a part of managing relationships in the supply chain. Based on the Code of Conduct for Business Partners of the Krka Group (see ESRS 2 G1-1 – Business conduct policies and corporate culture) and contractual commitments to comply with stringent quality standards, these actions contribute to preventing and mitigating potential material negative impacts in the value chain, including our contractual partners.
The company’s management tracks the effectiveness of actions and initiatives in delivering intended outcomes for consumers and/or end-users through different committees, particularly the Sales Committee and Quality Committee, and discusses key performance indicators (sales growth, market shares, etc.).
Independent internal and external audits also play an important role by regularly monitoring our work processes, verifying their compliance with standards and rules, and providing recommendations or identifying non-compliances within the corrective and preventive (CAPA) action system to highlight any shortcomings and encourage the implementation of corrective actions. Each procedure undergoes regular review. The review frequency is determined by the importance of the process or department in terms of the safety and efficacy of the finished product. If any shortcomings are identified, recommendations and actions are issued, along with deadlines to address any shortcomings, non-critical or critical non-compliances. An auditor supervises the implementation of the actions.
We manage material impacts in compliance with regulatory requirements by establishing an organisational structure that includes experts from various fields (chemical, pharmaceutical, medical, etc.). They have access to material and financial resources to prevent risks and potential negative impacts from materialising, minimise or eliminate them, or provide for restitution.
Targets and metrics related to monitoring the effectiveness of actions to address material impacts, risks and opportunities related to consumers and end-users are presented in the table below.
| Indicator | Up to 2028 target | 2024 |
|---|---|---|
| Improving our product accessibility through annual sales volume growth | 5% | 2% |
| Increasing the scope of patients (per year) treated with our cardiovascular medicines | 3% | 7.2% |
| Direct customer satisfaction, measured by the CSI index | The Krka Group’s average CSI index >80% | 93.3% |
| Critical non-compliances identified in inspections by authorised bodies or partner audits | 0 | 0 |
| Justified complaints to released batches ratio | <1% |
Notes: Based on the 2024–2028 Krka Group Development Strategy. Measures continuous company growth and improvement in accessibility of medicines related to increasing positive impacts. The target is measured against average sales volume growth, with a single pharmaceutical form as the basic unit.
Notes: Direct contribution to the United Nations’ Sustainable Development Goal to reduce by one third premature mortality from non-communicable diseases by 2030 through prevention and treatment and promote mental health and well-being. We contribute to the goal by increasing positive impacts, meaning that we increase the number of patients treated with our cardiovascular agents. The methodology considers the most probable or meaningful number of doses for each therapy or monthly therapy if medications for continued treatment are used. The Krka Group has no access to patient data, meaning that we calculate the metric indirectly using sales volume data and data on the use of medicines for each successful therapy (e.g. treating infections with antibiotics) or for a monthly therapy when chronic disease treatment is concerned. The result is obtained by dividing the quantity sold by the quantity used for each therapy. The metric is not validated by an independent external body.
Notes: CSI index is expressed as a percentage ranging from 10% (the lowest value corresponding to a rating of 1) to 100% (the highest value corresponding to a rating of 10). CSI assigns weights to satisfaction ratings by considering the importance of individual areas, adding to the CSI’s reliability. We gauge satisfaction on the level of direct customers. This target also measures the uninterrupted supply of medicines. CSI index is based on the requirements of the ISO 9001 standard on measuring customer satisfaction and its recommendations on how to carry out the measurement. Supported by relevant literature. Relates to Krka’s positive impacts and prevention of potential negative impacts. Applied to the Krka Group or relationships with direct customers in the downstream value chain. Presents average satisfaction scores weighted with importance ratings. Expressed as a percentage ranging from 10% (the lowest value corresponding to a rating of 1) to 100% (the highest value corresponding to a rating of 10).
0.79%
Notes: This target as related to potential negative impacts on product quality, safety, and efficacy. The metric refers to the proportion of batches with a justified complaint with respect to the total number of released batches. It is strategically determined on the Krka Group level. Stringent criteria for quality assurance, quality control and regulatory compliance in terms of product quality, safety and efficacy also apply to Krka Group production units outside the controlling company and to contractual partners in the upstream value chain.
Number of unethical or legally inappropriate marketing activity claims
0
0
Notes: The target is related to potential negative impacts. The metric refers to the records on unethical or legally inappropriate marketing activity claims received in a year. It is set on the Krka Group level.
Off-label promotion claims
0
0
Notes: The target is related to potential negative impacts. The metric refers to the records on off-label promotion claims received in a year. It is set on the Krka Group level.
We set the targets by considering the identified material sustainability impacts, risks and opportunities, adopted actions, and activities that ensure their effective management. We also took into account information obtained in an ongoing dialogue with direct customers, health professionals, and healthcare providers, by monitoring the needs, demands, and satisfaction of patients and direct customers by engaging with other stakeholder groups involved in the development, registration, production, quality management, marketing, and sales activities. We did not directly engage with stakeholders when setting the targets. Achieving the targets helps to increase Krka’s positive impact, reduces the likelihood of occurrence of negative impacts, contributes to managing risks and pursuing opportunities (particularly in terms of uninterrupted supply of quality, safe, and effective medicines), directly contributing to Krka Group’s performance. The Management and Supervisory Boards, Quality Committee, Sales Committee and Sustainability Committee monitor the achievement of the targets.
The umbrella documents governing corporate compliance throughout the Krka Group are Krka’s Code of Conduct and the Rules on Fraud Prevention, Detection and Investigation.
Krka’s Code of Conduct (hereinafter also the Code) lays out principles and rules of ethical conduct, good business practices, and standards of conduct in the Company, binding on all Krka employees. It regulates areas such as compliance with labour legislation, protection of confidential information, personal data protection, transparent reporting, management of risks related to frauds and abuses, conflict of interest, promotional activities, cooperation with business partners, fair competition, environmental protection, research and development, and social responsibility. It is available on our corporate website or websites of our subsidiaries. Subsidiaries must take national legislation into account. The Code is the foundation of all Krka’s internal rules. The Chief Compliance Officer is responsible for its implementation and for liaising with the directors and heads of departments within the Krka Group to fulfil this task. Directors are responsible for corporate compliance in subsidiaries and representative offices and report to the Chief Compliance Officer.
The Code outlines how to act in case of conflicts of interest. A conflict of interest exists when the personal interests of an individual affect or could affect the ability of an employee to carefully and objectively make decisions and carry out work to the benefit of Krka. A conflict of interest can also arise from an individual’s involvement in entrepreneurial, scientific, political, or other associations. The fundamental principle that employees must adhere to is making decisions in the best interest of Krka, meaning that they must refrain from decision-making when a conflict-of-interest risk exists.
Rules on Fraud Prevention, Detection and Investigation (hereinafter also the Rules) determine key objectives, principles, and rules on fraud management, duties, and responsibilities of Krka employees in that respect. The Rules are based on applicable regulations, recommendations, and Krka’s Code of Conduct, which sets out principles and rules of ethical conduct, good business practices and standards of conduct in the Company, and align with applicable anti-fraud and anti-corruption regulations, guidelines, and international standards of conduct. Our fraud management goals entail reducing the risk of fraud incidents in compliance with the principle of zero tolerance to fraud; raising employee awareness of potential fraud and its management, employee training on their responsibility regarding fraud identification and reporting; ongoing enhancement and management of internal control systems for preventing and detecting fraud; providing sufficient resources to prevent, detect and investigate fraud; consistent compliance with relevant regulations, guidelines and codes; commitment to investigate suspected fraud in a timely and appropriate manner; protection of persons reporting instances of fraud; and safeguarding Krka’s renown and assets. Subsidiaries must ensure that the Rules are respected, while adhering to any stricter national regulation.
In 2020, based on good practice and guidelines (Corporate Governance Code for State-Owned Enterprises), we drew up the Integrity Plan (hereinafter also the Plan) that describes risks, internal controls and measures in the areas of integrity, ethics, and compliance in business operations and proposes improvements. The plan is updated annually and commits us to constant corporate compliance improvements in the above-mentioned areas. The Integrity Plan includes as follows:
19 Also applies to ESRS 2 SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and business model (G1 – Business conduct)
informed about it. Both umbrella documents contribute to the spillover effect of Krka’s G1 material impacts, in particular regarding ethics, integrity, and corporate culture. Krka’s Code of Conduct and Rules on Fraud Prevention, Detection and Investigation apply to business relationships with customers and suppliers and within the Krka Group, while the Integrity Plan also regulates business relations with the value chain actors and stakeholders.
The code of conduct for Krka Group business partners is presented in more detail under ESRS S2, Disclosure Requirement S2-1 – Policies related to value chain workers. Promoting adherence to the code’s provisions contributes to advancing Krka’s positive impact throughout the value chain. The G1 topical standard primarily advocates for the highest standards of ethics, integrity, and high-level corporate culture, which in turn, supports the pursuit of G1-specific opportunities and the management of material risks, particularly in supplier relationships and animal welfare. This fosters long-term cooperation and fair partnership.
Krka’s Code of Promotion is presented in more detail under ESRS S4, Disclosure Requirement S4-1 – Policies related to consumers and end-users. In relation to material impacts, opportunities and risks, implementing the Code’s provisions helps deliver on the highest standards of corporate culture and ethics and prevents any incidents of corruption or bribery. The Code governs our downstream business relationships.
Corporate integrity, compliance and transparency of operations have been key at Krka at all levels of our activities and operations. We constantly strive to enhance our business practices and safeguard Krka’s renown and assets. When working, the benchmark for all employees is to comply with fundamental ethical principles, the values of honesty, loyalty, and professionalism, regulations, and Krka’s bye-laws.
We run mandatory internal training courses and publish articles in our in-house magazine to heighten employee awareness regarding potential fraud, non-compliance, and other violations and how to manage them, fostering accountability in their identification and reporting.
At the Krka Group level, we ensure education and employee awareness about the importance of compliance with Krka’s Code of Conduct. Employees take refresher courses via the eCampusHR information system every two years, while Marketing employees attend internal professional meetings. New employees are informed accordingly at induction seminars and receive a printed copy of Krka’s Code of Conduct. Training course attendance records are kept or logged via eCampus. Krka’s various departments screen customers, suppliers and business partners.
All employees, including members of the Management Board, and executives, take refresher courses on topics such as prevention and detection of corruption or bribery every two years. Training covers all work areas where the risk level in terms of integrity, ethics, and corporate compliance may be higher (see disclosures related to the Integrity Plan). Employees at the Company take refresher courses via the internal educational IT system eCampus, while employees at subsidiaries and representative offices attend cycle meetings where executives of the subsidiaries or representative offices present relevant topics.
The proportion of business functions with elevated risk levels in integrity, ethics, and corporate compliance covered by the training is 100%. Senior executive roles and roles in purchasing, marketing, sales, and investments are exposed to the highest potential risks of corruption and bribery.
Directive (EU) 2019/1937 and the implementing national legislation are binding on the controlling company and some of its subsidiaries (see the ‘Corporate Compliance Officer’ section). The European Commission adopted the Directive to upgrade the EU’s anti-fraud policies and align them with the international obligations stipulated in the United Nations Convention against Corruption.
Any breach of Krka’s Code of Conduct and suspected non-compliant actions resulting in harm to Krka are addressed in line with the national legislation, as well as internally, following the Rules on Fraud Prevention, Detection, and Investigation. The document is available in 29 languages. Subsidiaries adopted their own rules based on the Rules on Fraud Prevention, Detection, and Investigation in line with their national legislation. The Rules directly address corruption, fraud, bribery, and conflicts of interest.
Any purported irregularities can be reported via the publicly available e-mail address [email protected]. Subsidiaries have followed our example and set up their own channels where required by their respective national legislation. Subsidiaries with compliance officers are listed below (see the ‘Corporate Compliance Officer’ section). The compliance officer considers the reports and usually appoints a working team of experts who investigate the suspected non-compliance with the highest possible independence. Where a potential conflict of interest cannot be managed by appointing fully independent members, the group members disclose and explain the potential conflict of interest and refrain from decision-making if necessary. We guarantee anonymity to reporters.
We protect reporters as required by the legislation. Procedures for addressing reported breaches are set out in the Rules on Fraud Prevention, Detection and Investigation, section ‘Reporting Procedure’. Protection measures address confidentiality of information about the report and the reporter and the support to the reporter. Under the Rules, any retaliation against the reporter is considered a severe breach of Krka’s Code of Conduct.
When a case is closed, we adopt corrective actions if justified. The President of the Management Board is informed about the outcomes of the investigation into purported irregularities immediately after the conclusion of the investigation. The Management Board also deliberates on the outcomes once a year. By 1 March of the current year, the Company must report the number of reports received in the previous year to the Commission for the Prevention of Corruption of the Republic of Slovenia, as stipulated by the Slovenian Reporting Persons Protection Act. We submitted our first report to the Commission in 2024 for 2023. The electronic form included the following information:
There were no reported incidents of suspected corruption, unauthorized offers, or receipt of gifts in 2024. During this period, no Krka employees were convicted of violating anti-corruption laws related to Krka’s operations, and no fines were imposed in connection with such violations.
Krka’s subsidiaries in the EU, which employ between 50 and 249 people, are also required to establish mechanisms for reporting and addressing suspected violations. Consequently, they report to the relevant regulatory authorities in accordance with national legislation requirements.
In line with the described procedure, we also addressed reports of suspicions that did not meet the legal requirements for consideration.
In 2024, Krka was not made aware of any incidents of suspected corruption or bribery involving its employees or Krka Group subsidiaries.
At the Krka Group level, a Chief Compliance Officer is appointed to autonomously and independently oversee corporate integrity. They liaise with Legal Affairs, directors and heads of organisational units, and a secretary. The Chief Compliance Officer briefs the Supervisory Board on his activities through the Integrity Plan discussed by the body biennially, which happened last in 2024. They also report to the Management Board on all activities once a year.
Our subsidiaries employ their own compliance officers where required by national legislation or good practice. In 2022, subsidiaries in the Russian Federation, Poland, Ukraine, Croatia, Germany, and Terme Krka (Slovenia) had their compliance officers. In 2023, subsidiaries in Romania, Hungary, Czechia, Lithuania, Slovakia, Spain, Italy, Bulgaria, and Portugal appointed their compliance officers. They are also responsible for addressing the reports on any purported irregularities in subsidiaries. They report to Krka’s Chief Compliance Officer every quarter.
Krka’s subsidiaries follow national legislation and good practice in their marketing activities. Activities pursued by employees when marketing prescription pharmaceuticals are further detailed in Krka’s Code of Promotion, and operational instructions for visits to healthcare professionals and professional meetings, education and training, and company visits. These primarily relate to interactions with healthcare workers, healthcare organisations, patients, and patient societies.
We regularly update all these rulebooks. They are translated into the national languages of the countries where Krka has established a marketing network. Marketing employees receive information through eCampus, at internal cycle meetings, and training courses for marketing employees. They learn about the rules mentioned above and commit to work in line with them.
Non-discrimination principles are set down in Krka’s Code of Conduct, Human Rights Policy of the Krka Group, and Diversity, Equity and Inclusion Policy of the Krka Group.
In the Krka Group, we produce safe, high-quality, and effective animal health products for companion and farm animals. Animal welfare is one of the six material strategic sustainability areas in our Krka Group ESG Policy, specifically under the ‘Product quality and patient safety’ section.
We contribute to improving animal health and welfare by selecting and developing new animal health products and adhering to animal health care guidelines. In doing so, we comply with legislation based on Directive 2010/63/EU on the protection of animals used for scientific purposes. Our partners may only conduct product testing on animals after exploring other options, reducing the number of animals involved in testing, or redesigning procedures to minimise animal discomfort as much as possible. If scientifically justified and acceptable to regulators, alternatives to animal testing are used. Our products are designed to be easy for veterinarians and pet owners to administer and for animals to take. We follow current guidelines for safe, effective, and responsible treatment of diseases in poultry, cattle, pigs, and other farm animals. Our collaboration extends to veterinarians and animal owners in approximately 40 countries around the globe. Additionally, we encourage preventive measures to reduce disease risk and prevent unnecessary animal suffering. The health of humans, animals, and ecosystems is interconnected. Our animal health products positively impact the development of sustainable agriculture, which helps maintain the balance of the ecosystem. We contribute to healthy and safe foodstuffs and the protection of humans against foodborne and zoonoses by preventing and controlling disease outbreaks in farm animals.
The Management Board adopted the Code of Conduct for Business Partners of the Krka Group in September 2024. It stipulates that Krka sustainably contributes to improving animal health and welfare through careful planning in the selection and development of animal health products, and in compliance with legislation (Directive 2010/63/EU on the protection of animals used for scientific purposes) and animal health guidelines.
Each year, the Krka Management Board adopts procurement and payment terms for the following year. These terms define payment deadlines by procurement areas, payment terms, methods of concluding transactions (by contract or purchase order), guarantees required when concluding contracts, and any contractual penalties. Our payment terms do not depend on the size of the business partner. Procurement and payment terms in each procurement area are similar for all suppliers. Annual parameter updates allow us to consider market trends. The President of the Management Board and CEO reviews any deviations from the accepted parameters.
Where possible, we collect multiple comparable quotations for all transactions. This measure helps us manage risks in supply chain management, as well as in procurement of equipment, materials and services, and in investment execution. Experts from the relevant departments evaluate quotations and prepare a written report. Several employees, including the management of relevant departments approve the tender analysis. Before selection, we negotiate with all suppliers. Contracts include an anti-corruption clause, with the sanction resulting in the contract being null and void. Before signing, contracts are reviewed by in-house counsel, tax or accounting experts, users, and the head of negotiations. Transactions with a value in excess of €200,000 are subject to prior written approval from the President of the Management Board and CEO.
Disclosures pertaining to this requirement are detailed under Disclosure Requirement G1-1 – Business conduct policies and corporate culture in the ‘Addressing purported irregularities’ section.
| Metric | 2024 |
|---|---|
| Number of confirmed corruption or bribery incidents | 0 |
| The number of confirmed incidents in which own workers were dismissed or disciplined for corruption or bribery-related incidents | 0 |
| The number of confirmed incidents relating to contracts with business partners that were terminated or not renewed due to violations related to corruption or bribery | 0 |
| Details of public legal cases regarding corruption or bribery brought against the undertaking and its own workers during the reporting period and the outcomes of such cases | 0 |
| The amount of fines for violation of anti-corruption law (in €) | 0 |
With regard to sustainable business operations, we have assessed the topic of Political engagement and lobbying activities as insignificant for Krka during the materiality assessment process (IRO). We present these disclosures as other information, which is not subject to audit review and assurance.
In 2024 or over the past five years, Krka has not funded any political campaigns, political organisations, lobbyists, or lobbying organisations. In 2024 and for at least the preceding two years, members of Krka Management and Supervisory Boards and other executives (internal Directors’ Committee) have not held comparable positions in public administration or regulatory bodies that would enable lobbying. Krka Group companies are members of those advocacy groups where membership is obligatory or considered standard practice within the industry.
We manage sponsorships and donations as part of Krka Group’s commitment to sustainable business practices. Initiatives are carried out in accordance with Krka’s Code for Allocating Sponsorships and Donations. In line with our mission, ‘Living a healthy life’, we allocate most of our sponsorships and donations to projects related to health and quality of life. We allocate the majority of funds to support sports, culture, healthcare, science, education, and humanitarian initiatives.
| Region | No. of memberships | No. of obligatory memberships |
|---|---|---|
| Region Slovenia | 13 | 0 |
| Region South-East Europe | 8 | 3 |
| Region East Europe | 15 | 4 |
| Region Central Europe | 10 | 1 |
| Region West Europe | 15 | 7 |
The data on memberships has not been verified by an independent external body. We obtain key information about markets through memberships in economic and professional associations. Certain memberships are legally required or obligatory.
We ensure timely invoice payments through internal controls, which include appropriate settings in our business information system and clearly defined responsibilities in payment processes. Users and several relevant departments collectively ensure accurate and timely payment of invoices. These departments include purchasing, documentary and financial control, business accounting, and liquidity management.
| Metric | 2024 |
|---|---|
| Average payment term | 68 days |
| Standard payment terms in number of days by category of suppliers (in parenthesis – the percentage of payments aligned with these standard terms) | 45 days after receipt of invoice (100%), may be shorter based on the approval of the President of the Management Board and CEO |
| The number of legal proceedings outstanding for late payments as at 31 December 2024 | 0 |
Average number of days required to pay an invoice from the date the contractual or statutory payment term begins, calculated as days of binding obligations (average value of payables to suppliers in 2024 (average value at the beginning and end of the year), divided by production costs in 2024 and multiplied by 365 days. The average payment term data is calculated internally and has not been verified by an independent external body.
Similarly, the data on the number of unresolved legal proceedings for payment delays has not been independently confirmed by an external body. All Krka Group companies settle their liabilities within the agreed deadlines and do not discriminate against their suppliers, regardless of their size, type, bargaining power, or importance to the Krka Group. During business negotiations, Krka Group companies may agree with their suppliers on payment terms that extend beyond the standard 45-day period. This agreement is mutual and contractually defined, ensuring that all payments are made within the agreed deadline. As a result, the stated average payment term significantly deviates from the standard payment terms.
Introduction to the financial statements ..................................................................................................................... 255
Statement of compliance .............................................................................................................................................. 256
Consolidated financial statements of the Krka Group ............................................................................................... 257
Consolidated statement of financial position ............................................................................................................. 257
Consolidated income statement .................................................................................................................................. 258
Consolidated statement of other comprehensive income ............................................................................................ 258
Consolidated statement of changes in equity ............................................................................................................. 259
Consolidated statement of cash flows ....................................................................................................................... 261
Notes to the consolidated financial statements ......................................................................................................... 262
Independent Auditor's Report .................................................................................................................................... 317
Separate financial statement of Krka, d. d., Novo mesto ......................................................................................... 324
Separate statement of financial position .................................................................................................................. 324
Separate income statement ......................................................................................................................................... 325
Separate statement of other comprehensive income ................................................................................................. 325
Separate statement of changes in equity ................................................................................................................... 326
Separate statement of cash flows ................................................................................................................................ 328
Notes to the separate financial statements ............................................................................................................... 329
Independent Auditor’s Report .................................................................................................................................... 388
The financial statements consist of two separate sections. The first section illustrates the consolidated financial statements and related notes of the Krka Group, whereas the second section encompasses the financial statements and the accompanying Notes of Krka, d. d., Novo mesto (hereinafter: ‘the Company’). The financial statements have been prepared in compliance with the International Financial Reporting Standards (hereinafter: ‘IFRS’) as adopted by the European Union, which is in compliance with the resolution adopted at the 11th Annual General Meeting held on 6 July 2006.
The financial statements of the Company and the Krka Group are presented in euros, rounded to the nearest thousand. They are an integral part of the 2024 Annual Report, which is published via the SEOnet electronic announcement system of the Ljubljana Stock Exchange, the ESPIsystem of the Warsaw Stock Exchange, and on the Krka website (https://www.krka.biz/en/for–investors/financial–reports/).
KPMG Slovenija, d. o. o. audited each section of the financial statements and two separate reports as individual sections have been prepared accordingly. The Statement of Compliance presented below includes an acknowledgement of the Management Board's responsibility for all financial statements of both the Company and the Krka Group.
The Management Board of Krka, d. d., Novomesto is responsible for the preparation of the Annual Report of the Company and of the Krka Group including the financial statements in a manner that gives the interested public a true and fair view of the financial position and the results of operations of the Company and its subsidiaries in 2024.
The Management Board hereby acknowledges as follows:
The Management Board is responsible for taking the measures required to preserve the assets of the Company and the Krka Group and to prevent and detect fraud and other forms of misconduct.
The tax authorities may, at any time within a period of five years after the end of the year for which tax assessment was due, carry out the audit of the Company operations, which may lead to an assessment of additional tax liabilities, default interest, and penalties with regard to corporate income tax or other taxes and levies. The Management Board is not aware of any circumstances that may result in a significant tax liability.
Novo mesto, 24 March 2025
Jože Colarič
President of the Management Board and CEO
dr. Aleš Rotar
Member of the Management Board
dr. Vinko Zupančič
Member of the Management Board
David Bratož
Member of the Management Board
Milena Kastelic
Member of the Management Board – Worker Director
| € thousand | Notes | 31 Dec 2024 | 31 Dec 2023 | Index 2024/23 |
|---|---|---|---|---|
| Assets |
| 11 | 806,646 | 790,345 | 102 |
|---|---|---|---|
| 12 | 100,747 | 102,348 | 98 |
|---|---|---|---|
| 2,492 | 0 |
|---|---|
| 13 | 35,330 | 70,098 | 50 |
|---|---|---|---|
| 14 | 22,024 | 47,674 | 46 |
|---|---|---|---|
| 15 | 54,434 | 47,728 | 114 |
|---|---|---|---|
| 1,228 | 1,074 | 114 |
|---|---|---|
| 1,022,901 | 1,059,267 | 97 |
|---|---|---|
| 44 | 41 | 107 |
|---|---|---|
| 16 | 638,608 | 604,621 | 106 |
|---|---|---|---|
| 672 | 429 | 157 |
|---|---|---|
| 17 | 552,710 | 509,070 | 109 |
|---|---|---|---|
| 17 | 28,891 | 51,364 | 56 |
|---|---|---|---|
| 13 | 10,506 | 58,719 | 18 |
|---|---|---|---|
| 14 | 249,794 | 306,769 | 81 |
|---|---|---|---|
| 18 | 344,895 | 174,011 | 198 |
|---|---|---|---|
| 1,826,120 | 1,705,024 | 107 |
|---|---|---|
| 2,849,021 | 2,764,291 | 103 |
|---|---|---|
| 19 | 54,732 | 54,732 | 100 |
|---|---|---|---|
| 19 | –163,491 | –138,489 | 118 |
|---|---|---|---|
| 19 | 136,315 | 154,495 | 88 |
|---|---|---|---|
| 19 | 2,190,627 | 2,091,317 | 105 |
|---|---|---|---|
| 2,218,183 | 2,162,055 | 103 |
|---|---|---|
| 19 | 19,601 | 19,711 | 99 |
|---|---|---|---|
| 2,237,784 | 2,181,766 | 103 |
|---|---|---|
| 21 | 136,895 | 124,398 | 110 |
|---|---|---|---|
| 22 | 5,654 | 5,547 | 102 |
|---|---|---|---|
| 27 | 9,502 | 8,547 | 111 |
|---|---|---|---|
| 15 | 10,611 | 10,726 | 99 |
|---|---|---|---|
| 162,662 | 149,218 | 109 |
|---|---|---|
| 23 | 148,285 | 153,762 | 96 |
|---|---|---|---|
| 27 | 3,649 | 3,452 | 106 |
|---|---|---|---|
| 24,379 | 8,960 | 272 |
|---|---|---|
| 24 | 166,078 | 162,173 | 102 |
|---|---|---|---|
| 25 | 106,184 | 104,960 | 101 |
|---|---|---|---|
| 448,575 | 433,307 | 104 |
|---|---|---|
| 611,237 | 582,525 | 105 |
|---|---|---|
| 2,849,021 | 2,764,291 | 103 |
|---|---|---|
The accompanying Notes form an integral part of the consolidated financial statements and should be read in conjunction with them.
2024 Annual Report–Financial report of the Krka Group
258
| € thousand | Notes | 2024 | 2023 | Index | 2024/23 |
|---|---|---|---|---|---|
| Revenue | 1,909,544 | 1,806,391 | 106 | ||
| –Revenue from contracts with customers | 4 | 1,906,037 | 1,801,873 | 106 | |
| –Other revenue | 3 | 3,507 | 4,518 | 78 | |
| Cost of goods sold | –815,661 | –779,682 | 105 | ||
| Gross profit | 1,093,883 | 1,026,709 | 107 | ||
| Other operating income | 5 | 7,130 | 6,147 | 116 | |
| Selling and distribution expenses | –373,366 | –347,898 | 107 | ||
| –Whereof net impairments and write-offs of receivables | 2,197 | 3,712 | 59 | ||
| R\&D expenses | –184,855 | –178,582 | 104 | ||
| General and administrative expenses | –115,220 | –106,755 | 108 | ||
| Operating profit | 427,572 | 399,621 | 107 | ||
| Financial income | 9 | 33,946 | 23,567 | 144 | |
| Financial expenses | 9 | –42,440 | –56,062 | 76 | |
| Net financial result | –8,494 | –32,495 | 26 | ||
| Profit before tax | 419,078 | 367,126 | 114 | ||
| Income tax expense | 10 | –62,876 | –53,394 | 118 | |
| Net profit | 356,202 | 313,732 | 114 | ||
| Attributable to: | |||||
| –Equity holders of the controlling company | 356,986 | 313,946 | 114 | ||
| –Non-controlling interests | –784 | –214 | 366 | ||
| Basic earnings per share (€) | 20 | 11.60 | 10.14 | 114 |
20
11.60
10.14
114
The accompanying Notes form an integral part of the consolidated financial statements and should be read in conjunction with them.
€ thousand
| Notes | 2024 | 2023 | Index 2024/23 | ||
| Net profit | 356,202 | 313,732 | 114 | ||
| Other comprehensive income for the year | |||||
| Other comprehensive income reclassified to profit or loss at a future date | Translation reserve | 19 | –31,650 | –49,705 | 64 |
| Net other comprehensive income reclassified to profit or loss at a future date | –31,650 | –49,705 | 64 | ||
| Other comprehensive income that will not be reclassified to profit or loss at a future date | Change in fair value of financial assets | 14 | –4,877 | 10,912 | |
| Restatement of post-employment benefits | 21 | –8,426 | –12,007 | 70 | |
| Deferred tax effect | 15 | 704 | –2,695 | ||
| Net other comprehensive income that will not be reclassified to profit or loss at a future date | –12,599 | –3,790 | 332 | ||
| Total other comprehensive income for the year (net of tax) | –44,249 | –53,495 | 83 | ||
| Total comprehensive income for the year (net of tax) | 311,953 | 260,237 | 120 | ||
| Attributable to: | |||||
| –Equity holders of the controlling company | 312,063 | 261,740 | 119 | ||
| –Non-controlling interests | –110 | –1,503 | 7 |
The accompanying Notes form an integral part of the consolidated financial statements and should be read in conjunction with them.
| € thousand | Share capital | Treasury shares | Reserves | Retained earnings | Equity attributable to the holders of the controlling company | Non–controlling interests |
|---|---|---|---|---|---|---|
| Total equity | Reserves for treasury shares | Share premium | Legal reserves | Statutory reserves | Fair value reserve | Translation reserve | Other profit reserves | Retained earnings from previous years | Profit for the year |
|---|---|---|---|---|---|---|---|---|---|
| 54,732 | –138,489 | 138,489 | 105,897 | 14,990 | 30,000 | –511 | –134,370 | 1,544,595 | 246,699 |
| 300,023 | 2,162,055 | 19,711 | 2,181,766 | Net profit | 0 | 0 | 0 | 0 | 0 |
| 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 356,986 |
| 356,986 | –784 | 356,202 | Total other comprehensive income for the year (net of tax) | 0 | 0 | 0 | 0 | 0 | 0 |
| –10,851 | –32,331 | 0 | –1,741 | 0 | –44,923 | 674 | –44,249 | Total comprehensive income for the year (net of tax) | 0 |
| 0 | 0 | 0 | 0 | 0 | 0 | –10,851 | –32,331 | 0 | –1,741 |
| 356,986 | 312,063 | –110 | 311,953 | Transactions with owners, recognised in equity | Formation of other profit reserves under the resolution of the AGM |
| 75,503 | –75,503 | 0 | 0 | 0 | 0 |
|---|---|---|---|---|---|
| 0 | –25,002 | 0 | 0 | 0 | 0 |
|---|---|---|---|---|---|
| 0 | 0 | 0 | –25,002 | 0 | –25,002 |
| 0 | 0 | 25,002 | 0 | 0 | 0 |
|---|---|---|---|---|---|
| 0 | 0 | 0 | –25,002 | 0 | 0 |
| 0 | 0 | 0 | 0 | 0 | 0 |
|---|---|---|---|---|---|
| 0 | –230,933 | 0 | –230,933 | 0 | –230,933 |
| 0 | 0 | 0 | 0 | 0 | 0 |
|---|---|---|---|---|---|
| €thousand | Share capital | Treasury shares | Reserves | Retained earnings | Equity attributable to the holders of the controlling company | Non–controlling interests | Total equity | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Reserves for treasury shares | Share premium | Legal reserves | Statutory reserves | Fair value reserve | Translation reserve | Other profit reserves | Retained earnings from previous years | Profit for the year | ||||||
| Balance at 1 Jan 2023 | 54,732 | –124,566 | 124,566 | 105,897 | 14,990 | 30,000 | 2,670 | –85,919 | 1,442,702 | 200,273 | 353,271 | |||
| Balance at 31 Dec 2024 | 54,732 | –163,491 | 163,491 | 105,897 | 14,990 | 30,000 | –11,362 | –166,701 | 1,620,098 | 238,545 | 331,984 | 2,218,183 | 19,601 | 2,237,784 |
| 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 313,946 | 313,946 | –214 | 313,732 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 0 | 0 | 0 | 0 | 0 | 0 | –3,181 | –48,451 | 0 | –574 | 0 | –52,206 | –1,289 | –53,495 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 0 | 0 | 0 | 0 | 0 | 0 | –3,181 | –48,451 | 0 | –574 | 313,946 | 261,740 | –1,503 | 260,237 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 101,893 | –101,893 | 0 | 0 | 0 | 0 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 353,271 | –353,271 | 0 | 0 | 0 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 0 | –13,923 | 0 | 0 | 0 | 0 | 0 | 0 |
|---|---|---|---|---|---|---|---|
| Formation of reserves for treasury shares | 0 | 0 | –13,923 | 0 | –13,923 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Dividends paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | –204,378 | 0 | –204,378 | |||
| Acquisition of non-controlling interests | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||
| Total transactions with owners, recognised in equity | 0 | –13,923 | 13,923 | 0 | 0 | 0 | 0 | 0 | 101,893 | 47,000 | –367,194 | –218,301 | 1,321 | –216,980 |
| Balance at 31 Dec 2023 | 54,732 | –138,489 | 138,489 | 105,897 | 14,990 | 30,000 | –511 | –134,370 | 1,544,595 | 246,699 | 300,023 | 2,162,055 | 19,711 | 2,181,766 |
| Net profit | 356,202 | 313,732 |
|---|---|---|
| Adjustments for: | ||
| –Amortisation/Depreciation | 133,530 | 132,771 |
| –Net foreign exchange differences | –18,821 | –27,030 |
| –Net write-offs and allowances for inventories | 18,794 | 11,420 |
| –Net impairments and write-offs of receivables | –2,197 | –3,712 |
| –Investment income | –36,199 | –25,534 |
| –Investment expenses | 7,117 | 6,688 |
| –Income on financing activities | –31 | –4 |
| –Interest expenses and other financial expenses | 9,478 | 12,955 |
| –Income tax expense | 62,876 | 53,394 |
| Operating profit before changes in net current assets | 489,732 | 446,503 |
| Change in trade receivables | –41,640 | –104,133 |
| Change in inventories | –52,782 | –62,709 |
| Change in trade payables | –3,266 | 24,477 |
| Change in provisions | –451 | 1,770 |
| Change in deferred income | 107 | –501 |
| Change in other current liabilities | 3,859 | 15,944 |
| Income tax paid | –34,626 | –94,097 |
| Net cash flow from operating activities | 360,933 | 227,254 |
| Interest received | 14,250 | 9,668 |
|---|---|---|
| Dividends received | 941 | 798 |
| Proceeds from sale of property, plant and equipment | 1,587 | 2,433 |
| Purchase of property, plant and equipment | –107,762 | –130,024 |
| Purchase of intangible assets | –7,587 | –9,187 |
| Payments for acquiring joint ventures | –2,492 | 0 |
| Proceeds from non-current loans | 31,169 |
Krka, d. d., Novo mesto is the controlling company in the Krka Group with its registered seat at Šmarješka cesta 6, 8501 Novo mesto, Slovenia. The Company was registered at the District Court of Novo mesto on 13 July 1989, registration No. 1/00097/00. Company registration No.: 5043611000.
The consolidated financial statements for the year ended 31 December 2024 refer to the Krka Group consisting of the controlling company and its subsidiaries in Slovenia and abroad. A list of subsidiaries, members of the Krka Group, is included in Note 31 – Profile of the Krka Group.
The Krka Group develops, produces, markets and sells human health products (prescription pharmaceuticals, non-prescription products), animal health products, and health resort and tourist services.
The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (‘IFRS’) as adopted by the EU, interpretations issued by the International Financial Reporting Interpretations Committee of the IASB (‘IFRIC’) adopted by the EU, and in compliance with additional provisions required by the Companies Act (ZGD-1).
The Krka Management Board approved the consolidated financial statements on 24 March 2025.
The consolidated financial statements have been prepared on the historical cost basis, with the exception of derivatives, financial instruments at fair value through profit or loss and financial instruments at fair value through other comprehensive income (OCI) for which fair value was used. Methods applied in the measurement of fair value are presented.
| Payments for non-current loans | –3,489 |
|---|---|
| Net proceeds from/payments for current loans | 55,475 |
| Proceeds from sale of non-current investments | 71,168 |
| Payments for acquiring non-current investments | –184 |
| Proceeds from sale of current investments | 477,235 |
| Payments for acquiring current investments | –455,480 |
| Proceeds from derivatives | 1,959 |
| Payments for derivatives | –1,696 |
| Net cash flow from investing activities | 75,094 |
| Interest paid | –4,474 |
|---|---|
| Lease liabilities paid | 27 |
| Dividends and other profit shares paid | –230,884 |
| Repurchase of treasury shares | –25,002 |
| Proceeds from payment of non-controlling interests | 0 |
| Net cash flow from financing activities | –264,548 |
| Net increase/decrease in cash and cash equivalents | 171,479 |
|---|---|
| Cash and cash equivalents at beginning of year | 174,011 |
| Effect of foreign exchange rate fluctuations on cash held | –595 |
| Closing balance of cash and cash equivalents | 344,895 |
The consolidated financial statements are presented in euro, which is Krka’s functional currency. All financial information presented in the euro has been rounded to the nearest thousand.
The preparation of financial statements requires the Management Board of the controlling company to make judgements, estimates and assumptions that affect the carrying amounts of assets and liabilities of the Krka Group, as well as the reported income and expenses for the period.
Management estimates include among others: determination of the useful life and residual value of property, plant and equipment, as well as intangible assets; revenue from contracts with customers, allowances made for inventories and receivables; assumptions material to the actuarial calculation of defined employee benefits; assumptions used in the calculation of provisions for lawsuits, as well as assumptions and estimates relating to impairment of the TAD Pharma goodwill and the estimate of the lease term and the interest rate used. Regardless of the fact that the Management Board of the controlling company duly considers all factors that may impact the preparation of these assumptions, the actual consequences of business events may differ from those estimates. In making accounting estimates, management makes judgements while considering potential changes in the business environment, new business events, new and additional information that may be available, and experience. The Krka Group annually assesses whether impairment is necessary for the goodwill arising from the acquisition of TAD Pharma.
Information on significant estimates about uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amounts recognised in the financial statements is presented in the following notes:
Given the large number of contracts with customers, the Krka Group determined the expected value method as the most appropriate for estimating variable consideration for the sale of products with a right of return. Prior to including any variable consideration in the transaction price, the Krka Group assesses whether there is a constraint on variable consideration. Based on experience, business forecasts, and current economic conditions, the Krka Group has determined that there are no constraints on variable consideration. The Krka Group is a seller of products that may be subject to payment terms in excess of one year in certain markets. Krka recognises financial income and expenses on these sales using the appropriate discount rate.
- Note 11 – Testing the useful lives of property, plant and equipment
The Krka Group's annual review of the appropriateness of the annual depreciation rates or useful lives of plant and equipment resulted in different expectations from previous estimates. As a result, new (mostly longer) useful lives and therefore lower depreciation rates for each type of asset were defined. The useful lives of production and laboratory equipment, furniture and means of transportation have changed as well.
- Note 12 – Impairment testing of non-current assets
The controlling company checks for each cash-generating unit to see whether there are any indicators of impairment at least once a year. The recoverable amount of non-financial assets determined as the present value of future cash flows is based on an estimate of expected cash flows from the cash-generating unit and also on a determination of the appropriate discount rate.
- Note 12 – Impairment testing of the TAD Pharma goodwill
The criteria used in goodwill impairment testing are verified at least once a year by the controlling entity. Determining the present value of future cash flows requires the controlling company's Management Board to assess estimated future cash flows from each cash-generating unit and determine the appropriate discount rate and other significant assumptions explained in this Note.
- Note 17 – Impairment testing of receivables
On the financial statement preparation (quarterly and annually), individual Krka Group companies recognise allowances (impairment) of those receivables for which it is assumed that will not be settled in full or not at all. Allowances are recognised using a uniform methodology applicable to the Krka Group and taking into consideration the probability or assessed probability of receivable settlement by the debtors. The methodology includes quantitative and qualitative criteria grouped into the following four sets: an analysis of the existing business dealings with the customer, an analysis of the customer's financial statements, a qualitative assessment of the customer by the sales personnel, and an assessment of the customer's country risk. For all customers whose receivables are insured by an insurance company or other first-class insurance, the insurance is taken into account when assessing impairment amounts. Hence, allowances of receivables due from individual customers are calculated using an algorithm that includes all the above criteria.
- Note 21 – Post-employment benefits
Defined post-employment benefit obligations include the present value of termination benefits on retirement. They are recognised on the basis of the actuarial calculation using assumptions and estimates effective at the time of the calculation, and which may, as a result of future changes, differ from actual assumptions applicable at that future time. This applies primarily to determination of a discount rate, assessment of employee turnover, mortality assessment, and assessment of an increase in salaries. Due to the complexity of the actuarial calculation and the long-term nature of the item, defined benefit obligations are sensitive to changes in the above estimates and assessments.
- Note 21 – Provisions for lawsuits and contingent liabilities
Lawsuits and claims may be brought against individual companies in the Krka Group for alleged breaches of intellectual property (patent rights or competition law) and those referring to other civil law areas. A provision is recognised when a Krka Group company has present obligations (legal or constructive) as a result of past events, a reliable estimate can be made of the amount of obligation, and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation. Contingent liabilities are not recognised in the financial statements as their actual existence will be confirmed only upon the occurrence or non-occurrence of one or more uncertain future events not entirely within the control of the Krka Group. The Management Board of the controlling company continually assesses contingent liabilities to determine whether an outflow of resources embodying economic benefits has become probable. If this is the case, a provision is recognised in the financial statements of the period in which the change in probability occurs.
Accounting policies applied by subsidiaries have been changed where necessary and adjusted with policies applied by the Krka Group.
The accounting policies and the calculation methods used are the same as for the last annual reporting, except for the new standards and interpretations, which are noted below and were applied if relevant events occurred in the Krka Group during the reporting period.
In its statement of financial position, the Krka Group classifies liabilities and assets according to their maturity i.e. as non-current and current.
The Krka Group classifies an asset as current if:
The Krka Group classifies all other assets as non-current.
The Krka Group classifies a liability as current if:
The Krka Group classifies all other liabilities as non-current.
Subsidiaries are entities controlled by the controlling company. Control exists when the controlling company has the power to govern an entity's financial and operating policies to obtain benefits from its activities. In assessing control, potential voting rights that are exercisable or exchangeable are taken into account.
The Krka Group considers that the conditions for controlling both Russian subsidiaries by the controlling company have not changed due to the situation in Ukraine and the Russian Federation. The controlling company retains influence over the operations of the Russian companies and voting rights, including influence over variable returns. Activities with the Russian subsidiaries are conducted in a similar manner as before February 2022, as pharmaceuticals are not subject to EU sanctions, and we do not expect this to change. Refer to Note 33 – Situation in Ukraine and the Russian Federation.
The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.
Joint ventures are companies that the Krka Group jointly controls on the basis of a contractual agreement. Investments in joint ventures are measured at cost on initial recognition in the consolidated financial statements and subsequently accounted for using the equity method. The joint venture's attributable share of profit or loss is recognised in the consolidated income statement. The attributable effects included in other comprehensive income of the joint venture are recognised in the consolidated statement of comprehensive income.
The attributable share of profit or loss of the joint venture is recognised in consolidated profit or loss from the date that the significant influence commences until the date it ceases.
Intra-group balances and transactions, as well as any unrealised gains and losses arising from intra-group transactions, are eliminated when preparing the consolidated financial statements of the Krka Group. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.
Transactions and balances in foreign currencies are translated to the respective functional currencies of Krka Group entities at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to the functional currency at the prevailing exchange rate at that date. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are translated to the functional currency at the exchange rate on the date when the fair value was determined. Foreign currency differences are recognised in profit or loss, except for differences arising on the translation of equity instruments, which are recognised directly in other comprehensive income. Non-cash items measured at historical cost in foreign currency are translated to the functional currency by applying the exchange rate valid at the transaction date.
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on consolidation, are translated to the euro at exchange rates prevailing at the reporting date. The income and expenses of foreign operations are translated to the euro. Foreign exchange differences arising on translation are recognised directly in other comprehensive income as a translation reserve. When a foreign operation is disposed of, in part or in full, the relevant amount in the translation reserve is transferred to profit or loss.
Operating profit comprises profit before tax and financial items. Financial items include interest on bank balances, deposits, investments held for sale, interest paid on borrowings, profit or loss from the sale of financial assets at fair value through other comprehensive income, and foreign exchange gains or losses from the translation of all monetary assets and liabilities to foreign currency.
The fair value of individual groups of assets has been determined for measurement and/or disclosure purposes based on the methods presented below. Where applicable, further information about the assumptions made in determining fair values is disclosed in the Notes specific to that asset or liability of the Krka Group.
The fair value of financial assets at fair value through profit or loss and at fair value through OCI is determined by reference to their quoted closing bid price. For investment in debt securities at amortised cost, for reporting purposes, the fair value is calculated based on the closing rate, which is increased by accrued interest on the reporting date.
The fair value of trade and other receivables is estimated at the present value of future cash flows discounted at the market rate of interest effective at the reporting date.
Fair value is determined based on the present value of future principal and interest payments discounted at the market rate of interest prevailing at the reporting date.
A financial instrument is any contract that gives rise to a financial asset for one entity and a financial liability or equity instrument for another.
Financial assets of the Krka Group include cash and cash equivalents, receivables, derivatives, loans and investments.
Upon initial recognition, Krka Group's financial assets are classified as subsequently measured at amortised cost, fair value through other comprehensive income (FVOCI), and fair value through profit or loss.
The classification of financial assets at initial recognition depends on the financial assets’ contractual cash flow characteristics and the Krka Group's business model for managing them. With the exception of trade receivables that do not have a significant financing component or for which the Krka Group has applied the practical expedient, the Krka Group initially measures a financial asset at fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. Trade receivables that do not have a significant financing component or for which the Krka Group has applied the practical expedient are measured at the transaction price determined within IFRS 15 (refer to accounting policies ‘Revenue from contracts with customers’).
For financial assets to be classified and measured at amortised cost or fair value through other comprehensive income, they need to give rise to cash flows that are solely payments of principal and interest (SPPI) on the principal amount outstanding. This assessment is referred to as the SPPI test and is performed at an individual instrument level.
The Krka Group's business model for managing financial assets refers to how it manages its financial assets in order to generate cash flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial assets, or both.
Where the Krka Group selects a business model that aims to collect contractual cash flows, it values its financial assets (debt instruments) at amortised cost. If the Krka Group acquires financial assets (debt instruments) with the intent to collect contractual cash flows and selling them, then they are measured at fair value through other comprehensive income by recycling cumulative gains and losses. Where the Krka Group does not choose any of these mentioned business models, it measures its financial assets (debt instruments) at fair value through profit or loss. Financial assets that are in accordance with IAS 32 – Financial Instruments and are not held for trading purposes are classified as equity instruments at fair value through other comprehensive income without recycling cumulative gains and losses after derecognition.
Purchases or sales of financial assets that require delivery of assets within a timeframe established by regulation or convention in the marketplace (regular way trades) are recognised on the trade date, i.e. the date that the Krka Group commits to purchase or sell the asset.
The Krka Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire or when it transfers the rights to the contractual cash flows from the financial asset in a transaction that transfers all the risks and rewards of ownership of the financial asset.
For purposes of subsequent measurement, financial assets are classified into four categories:
Cash and cash equivalents comprise cash, bank deposits with maturities of up to three months, and other current, highly liquid investments with an original maturity of three months or less. These investments can be easily converted into known amounts of cash with an insignificant risk of value fluctuation. The cash flows derived from these assets consist solely of principal and interest payments, classifying them as financial assets at amortised cost.
According to the SPPI test, loans issued by the Krka Group are classified as financial assets at amortised cost, since the cash flows derived from these assets are solely payments of the principal and interest on the principal amount outstanding. Krka Group’s investments in debt securities, comprising only low credit-risk government bonds are classified as financial assets at amortised cost.
The Krka Group's financial assets at amortised cost also include trade receivables. After initial recognition, these investments are measured using the effective interest method and are subject to impairment. Gains and losses are recognised in profit or loss when the asset is derecognised, modified or impaired.
Subsequent to initial recognition, they are measured at fair value. Interest income, foreign exchange differences, and impairment losses or reversals are recognised in the statement of profit or loss and computed in the same manner as for financial assets measured at amortised cost. The remaining fair value changes are recognised in OCI. Upon derecognition, the cumulative fair value change recognised in OCI is transferred to profit or loss.
Financial assets at fair value through profit or loss include financial assets held for trading, financial assets designated upon initial recognition at fair value through profit or loss, or financial assets mandatorily required to be measured at fair value. Financial assets are classified as held for trading if they are acquired for the purpose of selling or repurchasing in the near term. Derivatives, including separated embedded derivatives, are also classified as held for trading unless they are designated as effective hedging instruments. Financial assets with cash flows that are not solely payments of principal and interest are classified and measured at fair value through profit or loss, irrespective of the business model. Financial assets at fair value through profit or loss are carried in the statement of financial position at fair value, with net changes in fair value recognised in the statement of profit or loss.
Impairment of financial assets is described in the section ‘Impairment– Financial assets’.
Financial liabilities consist mainly of loans, payables to suppliers and other liabilities. Lease liabilities and employee benefits are treated separately (refer to accounting policies in the ‘Leases’ and ‘Employee benefits expense’ sections). All other financial liabilities are initially recognised on the trade date or when the Krka Group becomes a contracting party in relation to the instrument. On initial recognition, non-derivative financial liabilities are classified as subsequently measured at amortised cost and derivative financial liabilities as at fair value through profit or loss. After initial recognition, financial liabilities arising from loans are measured using the effective interest method. Gains and losses are recognised in profit or loss when these liabilities are discharged or modified. The Krka Group derecognises a financial liability if the obligations set out in the contract are fulfilled, cancelled or expired.
Property, plant and equipment items are measured at cost less accumulated depreciation and impairment losses (refer to the accounting policy ‘Impairment of assets’). Property, plant and equipment that was revalued to its fair value on 1 January 2004 or on the date of transition to IFRS shall be measured at its fair value at that date.
Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labour, any other directly attributable cost of making the asset ready for its intended use, and (if applicable) costs of dismantling and removing the items and restoring the site on which they are located, as well as capitalised borrowing costs. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment.
Property, plant and equipment items that have substantially different useful lives but whose value is significant are accounted for as individual assets.
Gains and losses on disposal of an item of property, plant and equipment are determined as the difference between proceeds from disposal and the carrying amount of property, plant and equipment and are recognised within ‘Other operating income’ or ‘Other operating expenses’ in profit or loss.
The Krka Group includes in the cost of property, plant and equipment also borrowing costs that are directly attributable to the acquisition, construction or production of the asset under construction. Borrowing costs related to the acquisition or construction of the relevant assets are capitalised if they relate to the acquisition of a significant asset and if construction or preparation for use of the relevant assets takes more than six months.
The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Krka Group and its cost can be measured reliably. The carrying amount of the replaced part is derecognised. All other costs are recognised in profit or loss as an expense when incurred.
Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful lives of each item of property, plant and equipment, or individual parts. Land and assets being acquired are not depreciated.
| Asset Type | 2024 | 2023 | |
|---|---|---|---|
| Buildings | – Management and administrative facilities | 60 | 60 |
| – Production and warehouse facilities | 40 | 40 | |
| – Other | 15 to 20 | 15 to 20 | |
| Property, plant and equipment | – Production equipment | 3 to 15 | 5 to 20 |
| – Laboratory equipment | 7 to 15 | 10 | |
| – Other | 5 to 20 | 5 | |
| Furniture | 5 or 10 | 5 | |
| Computer equipment | 4 to 6 | 4 to 6 | |
| Means of transportation | 6 to 15 | 5 to 15 |
Upon contract conclusion, the Krka Group assesses whether a contract is or contains a lease. Specifically, whether the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Krka Group determines the lease term as the period during which the lease cannot be terminated, inclusive of:
At the commencement date of the lease, the Krka Group recognises lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in-substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid by the Krka Group under residual value guarantees. The lease payments also include the exercise price of a purchase option reasonably certain to be exercised by the Krka Group and payments of penalties for terminating the lease if the lease term reflects the Krka Group exercising the option to terminate. Variable lease payments that do not depend on an index or a rate are recognised in profit or loss as expenses in the period in which the event or condition that triggers the payment occurs.
In calculating the present value of lease payments, the Krka Group uses its incremental borrowing rate based on estimated bond returns if it were to incur debt on the financial markets, while considering their maturity if the interest rate implicit in the lease is not readily determinable.
Upon initial recognition, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made.
The carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the lease payments (e.g. change of future payments resulting from a change in an index or rate used to determine such lease payments) or a change in the assessment of an option to purchase the underlying asset.
For short-term leases and leases where the leased asset is of low value, the Krka Group applies the practical expedient allowed by the standard and recognises lease payments as an expense on a straight-line basis over the lease term. The practical expedient is applied to leases with a lease term of less than one year and leases where the cost of the new leased asset is less than €5,000.
The Krka Group recognises a right-of-use property, plant and equipment asset and a lease liability at the inception of the lease (i.e. the date the leased asset is available for use).
Right-of-use assets are measured at cost less any accumulated depreciation and impairment losses and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received, as well as estimated costs that will be incurred in dismantling or removing the leased asset, restoring the site to its original condition, or returning the asset to a condition as required in the lease terms.
The Krka Group depreciates the right-of-use assets on a straight-line basis over the shorter of the estimated lease term or the estimated useful lives of the assets.
Leases in which the Krka Group does not transfer substantially all the risks and rewards incidental to ownership of an asset are classified as operating leases. Rental income arising is accounted for on a straight-line basis over the lease terms and is included in revenue in the statement of profit or loss. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same basis as rental income.
Goodwill, which arose on the acquisition of the subsidiary, represents the excess of the cost of the acquisition over the Krka Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the acquiree. Goodwill is measured at cost, less accumulated impairment losses, and tested for impairment yearly.
The Krka Group treats the TAD Pharma trademark as an intangible asset with a useful life of 50 years, whereas it is reviewed for impairment given the changed circumstances in the business environment.
Development costs are not capitalised because the Krka Group does not distinguish between the research and development phases. All costs related to own research and development activities are recognised as an expense in profit or loss as incurred.
Other intangible assets that are acquired by the Krka Group, which have finite useful lives, are measured at cost less accumulated amortisation and accumulated impairment losses (refer to the accounting policy ‘Impairment of assets’).
Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset it pertains to. All other expenditure, including expenditure on internally generated goodwill and trademarks, is recognised in profit or loss as incurred.
The Krka Group recognises emission coupons purchased or acquired free of charge in order to fulfil its obligation to the State to surrender emission coupons under the Environmental Protection Act as intangible assets. Emission coupons acquired free of charge are carried at €1 per emission coupon, while those purchased are measured at cost on initial recognition. The first-in-first-out (FIFO) method is used to transfer coupons. Intangible assets relating to emission coupons are not amortised.
Amortisation is recognised on a straight-line basis over the estimated useful lives of intangible assets (except for goodwill) from the date they are available for use. The estimated useful lives of software, licences and other rights range from 3 to 10 years, and 50 years for the TAD Pharma trademark.
In the statement of financial position, inventories are measured at the lower of cost and net realisable value. Net realisable value is the estimated selling price at the reporting date, less selling expenses. The Krka Group reviews the net realisable value of inventories once a year at the date of the consolidated statement of financial position. If the carrying amount of inventories exceeds their net realisable value, inventories are written down through profit and loss.
As of the reporting date, the Krka Group also reviews whether inventories need to be impaired. Thus, impaired are:
Possible impairments are reviewed and recorded by inventory type group through profit or loss.
and work in progress are carried at standard cost, which in addition to the direct cost of material, includes the cost of production, such as: direct cost of labour, depreciation, cost of services, energy, maintenance and quality. Fixed price variances are determined in accordance with the current valuation of inventories using production costs. A quantity unit of merchandise is valued at cost, including cost of purchase, import duties, and all costs directly attributable to the acquisition decreased by discounts. Inventories of merchandise are carried at moving average prices.
The Krka Group recognises an allowance for the expected credit losses (ECLs) for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Krka Group expects to receive, discounted at an approximation of the original effective interest rate. The expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms.
Expected credit losses are recognised in two stages. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12 months (a 12-month ECL). For those credit exposures for which there has been a significant increase in credit risk since the initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).
The Krka Group applies a simplified approach in calculating ECLs for trade receivables and contract assets. Trade receivables that do not have a significant financing component or for which the Krka Group applies a practical expedient (contracts with a term of one year or less) are measured at the transaction price determined in accordance with IFRS 15, less the amount of any impairment losses.
The Krka Group does not track changes in credit risk. Instead, it recognises a loss allowance based on a lifetime ECL at each reporting date. The Krka Group has established a provision matrix that is based on its credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment. Allowances are recognised using a uniform methodology applicable to the Krka Group and taking into consideration the probability or assessed probability of receivable settlement by the debtors.
The Krka Group measures expected credit losses annually for investments that include government bonds measured at amortised cost.
Except when a 12-month expected credit loss is recognised, the Krka Group recognises an allowance for credit losses in an amount equal to the expected credit loss over the entire life of the financial instrument. A 12-month expected credit loss is recognised by:
The Krka Group considers a debt security to have low credit risk if its credit risk rating is equivalent to the globally understood definition of ‘investment grade’, which equals to a rating of Baa2 or above by Moody's or BBB– or above by S&P Global Ratings.
The Krka Group monitors changes in credit risk by tracking published external credit ratings. The probabilities of default (PD), both 12-month and over the financial instrument’s life, are based on information from the external credit rating agency. The external credit rating agencies also report the loss given default (LGD) ratio, which reflects the assumed recovery rate.
The carrying amounts of the Krka Group’s non-financial assets are reassessed at each reporting date to determine whether there is any indication of impairment. If such indications exist, the asset’s recoverable amount is assessed.
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to the present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets are grouped into the smallest cash-generating units, which are the smallest groups of assets that generate cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets. For the purpose of impairment testing, the goodwill acquired in a business combination is allocated to cash-generating units that are expected to benefit from the synergies of the combination.
An impairment of an asset or a cash-generating unit is recognised when its carrying amount exceeds its recoverable amount. Impairment is recognised in the income statement. A loss recognised in a cash-generating unit as a result of impairment is allocated by first reducing the carrying amount of goodwill allocated to the cash-generating unit and then to the other assets of the unit (group of units) in proportion to the carrying amount of each asset in the unit.
An impairment loss in respect of goodwill is not reversed. Regarding other assets, impairment losses recognised in previous periods are assessed at each reporting date for any indication that the loss has decreased or no longer exists. An impairment loss is reversed upon the changed estimates used to determine the recoverable amount of the asset. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised in the previous periods.
When treasury shares recognised as a part of share equity are repurchased, the amount of the consideration paid, including directly attributable costs, is recognised as a deduction from equity. Repurchased shares are classified as treasury shares and are presented as a deduction from total equity.
Dividends are recognised in the Krka Group’s consolidated financial statements in the period in which they are declared by the Annual General Meeting.
Current employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided.
Pursuant to local legislation of countries where the controlling company and its subsidiaries operate, the Krka Group is obligated to provide employees with anniversary bonuses and retirement benefits. Provisions are set aside for these obligations.
The calculation is performed using the projected unit credit method. Employee benefit costs, as well as cost of interest, are recognised in profit or loss, whereas restatement of post-employment benefits or unrealised actuarial profit or loss is recognised in other comprehensive income.
A provision is recognised if, as a result of a past event, the Krka Group has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation.
The Krka Group recognises provisions for lawsuits primarily related to alleged patent infringements. The adequacy of these provisions, based on the likelihood of a favourable or unfavourable outcome, is assessed annually. The provision amounts are determined either by the amount of the indemnification claim or, if no claim has been disclosed, by an estimated potential amount.
The Krka Group develops, produces, markets and sells human health products (prescription pharmaceuticals, non-prescription products), animal health products, and health resort and tourist services. Revenue from contracts with customers is recognised when control of the goods and services is transferred to the customer at an amount that reflects the consideration to which the Krka Group expects to be entitled in exchange for those goods or services while considering specific terms and conditions of an individual contract.
Transfer of control over those goods and services depends on the terms and conditions of the contract. In general, control is transferred when goods are accepted by the customer or services are rendered. The standard credit term ranges from 30 to 120 days.
The Krka Group assesses the performance obligations contained in each sales contract and determines whether additional promises in the contract constitute separate performance obligations requiring allocation of a portion of the transaction price. In determining the transaction price for the sale of products, the effects of variable consideration are considered, as well as the existence of significant financing components.
If the consideration in a contract includes a variable amount, the Krka Group estimates the amount of consideration to which it will be entitled in exchange for transferring the goods or services to the customer. The variable consideration is estimated at contract inception and constrained until it is highly probable that a significant revenue reversal in the amount of cumulative revenue recognised will not occur when the associated uncertainty with the variable consideration is subsequently resolved. Some contracts for the sale of products provide customers with a right of return, bonuses, and volume rebates. The rights of return, bonuses, and volume rebates give rise to variable consideration.
Certain contracts provide a customer with a right to return goods that are past the expiry date. The Krka Group uses the expected value method to estimate the goods that will not be returned because this method best predicts the amount of variable consideration to which the Krka Group will be entitled. The requirements of IFRS 15 on constraining estimates of variable consideration are also applied in order to determine the amount of variable consideration that can be included in the transaction price. For goods that, based on experience and business practice in a given environment, are expected to be returned rather than generating revenue, the Krka Group recognises a refund liability. A right-of-return asset (and corresponding adjustment to cost of products sold) is also recognised to account for the right to recover products from customers.
The Krka Group provides retrospective bonuses and volume rebates to some customers once the quantity or value of products or services purchased during the period exceeds a threshold specified in the contract. Rebates are offset against amounts payable by the customer. To estimate the variable consideration for the expected future rebates, the Krka Group considers the terms and conditions of the contract, including criteria and elements that provide the basis for the recognition of bonuses and volume rebates.
For valuation, Krka Group uses the most probable value method or the expected value method. The method chosen, which best predicts the value of the rebates and volume discounts, is based on the number of thresholds in the contract. In addition to discounts available to end customers, the Krka Group also grants discounts for public procurement to countries, ministries, or insurance companies in individual countries, based on the agreed tender conditions or contractual provisions and the actual sales orders realised.
Disclosures about the use of estimates and judgements in estimating variable consideration are provided in the Basis of preparation of the financial statements section.
In some cases, the Krka Group receives current advances from its customers. Using the practical expedient in IFRS 15.63, the Krka Group does not adjust the promised amount of consideration for the effects of a significant financing component if it expects, at contract inception, that the period between the transfer of the promised goods or services to the customer and when the customer pays for those goods or services will be one year or less.
A contract asset is the right to an amount of consideration in exchange for goods or services transferred to the customer. If the Krka Group transfers goods or services to a customer before receiving payment or before payment becomes due, a contract asset is recognised for the conditional earned consideration. Once the transaction is completed and the customer is confirmed, the contract assets are reclassified as trade receivables.
A receivable is the Krka Group's right to an amount of consideration that is unconditional, i.e. only the passage of time is required before payment of consideration is due (refer to the accounting policy ‘Recognition of financial instruments’).
A contract liability is the obligation to transfer goods or services to a customer for which the Krka Group has received consideration (or an amount of consideration is due) from the customer. If a customer pays consideration before the goods or services are transferred to the customer, a contract liability is recognised when the payment is made, or the payment becomes due (whichever is earlier). Contract liabilities are recognised as revenue when the Krka Group performs under the contract.
Right-of-return assets represent the Krka Group's right to recover the goods expected to be returned by customers. The asset is measured at the former carrying amount of the inventory, less any expected costs to recover the goods, including any potential decreases in the value of returned goods. The Krka Group regularly updates the measurement of the asset recorded for any revisions to its expected level of returns, as well as any additional decreases in the value of the returned products.
The Krka Group updates its estimates of refund liabilities (and the corresponding change in the transaction price) at the end of each reporting period. Refer to the above accounting policy on variable consideration. It is irrelevant to the Krka Group's assessment of the role it plays in individual customer contracts, as it usually acts as a principal.
Income from government grants is initially recognised when there is reasonable assurance that the grant will be received and that the Krka Group will comply with the attached conditions. Income that compensates the realised expenses is recognised in profit or loss on a systematic basis in the same periods in which the costs are recognised. Income that compensates an entity for the cost of an asset is recognised in profit or loss on a systematic basis over the useful life of the asset.
The Krka Group recognises emission coupons received free of charge from the State within government grants received. The emission coupons received free of charge are recorded as intangible assets at a value of €1 per emission coupon. Upon their transfer, the Krka Group reduces intangible assets and recognises other operating income.
Financial income comprises interest income on funds invested, dividend income, gains on the disposal of financial assets, changes in the fair value of financial assets at fair value through profit or loss, foreign exchange gains and gains on hedging instruments that are recognised in profit or loss. Interest income is recognised as it accrues in profit or loss, using the effective interest method. Dividend income is recognised on the date that the shareholder's right to receive payment is established, which in the case of quoted securities is the ex-dividend date.
Financial expenses comprise interest expense on borrowings, foreign exchange losses, changes in the fair value of financial assets at fair value through profit or loss, impairment losses recognised on financial assets, and losses on hedging instruments that are recognised in profit or loss. All borrowing costs are recognised in profit or loss using the effective interest method, except those that are attributable to property, plant and equipment under construction.
Income tax expense comprises current, top-up and deferred tax. Income tax expense is recognised in profit or loss except to the extent that it relates to items recognised directly in other comprehensive income. Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted at the reporting date, and any adjustment to tax payable in respect of previous financial years.
Deferred tax is recognised using the balance sheet liability approach providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for the following temporary differences: the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit, and differences relating to investments in subsidiaries and jointly controlled entities to the extent that it is probable that they will not reverse in the foreseeable future. Also, deferred tax is not recognised for taxable temporary differences arising on the initial recognition of goodwill. The amount of deferred tax is based on the expected manner of settling the carrying amount of assets and liabilities using tax rates enacted at the reporting date. Deferred tax assets are offset against deferred tax liabilities when an entity has a legal right to offset current assets and liabilities, and deferred tax assets and liabilities relate to the same taxable entity and the same tax authority.
A deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available against which the deferred tax asset can be utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised.
In 2023, Slovenia adopted the Minimum Tax Act, incorporating a minimum tax into the Slovenian tax-law system to ensure that large international and domestic groups are subject to a global minimum taxation of profits at an effective tax rate of 15%. The Act was adopted based on EU Directive 2022/2523 on the provision of a global minimum tax rate for international and large domestic groups in the EU, which was drafted based on the GLOBE Model Rules prepared by the Organisation for Economic Co-operation and Development (OECD) in October 2021. The Act's minimum tax rules apply to the Krka Group's financial years starting from 1 January 2024.
The Krka Group is subject to the minimum tax rules for the financial year 2024 onwards. The Company for the first time calculated the Krka Group's top-up tax and the domestic top-up tax for Slovenia for the year 2024. In Slovenia, the Company can benefit from simplifications during the initial years of applying the rules (transitional CbCR Safe Harbour), exempting it from calculating the domestic top-up tax.
The Krka Group reports basic earnings per share, which is calculated by dividing the profit or loss attributable to majority shareholders by the average number of ordinary shares issued during the financial year, whereby treasury shares are excluded. Diluted earnings per share is equal to basic earnings per share because the Krka Group has not issued any dilutive or contingently dilutive instruments.
An operating segment is a distinguishable component of the Krka Group that is engaged in providing products or services within a particular geographically defined economic environment. Segments are different in terms of risks and returns. The Krka Group's segment reporting is based on the Krka Group's internal reporting system, which is applied by the controlling company's management in the decision-making process.
The segments include: the EU (all EU member countries), South-Eastern Europe (Serbia, Bosnia and Herzegovina, North Macedonia, Montenegro, Kosovo, and Albania), Eastern Europe (Russian Federation and other former Soviet Union countries excluding the Baltic countries), as well as Other (countries not included in any of the above segments). Revenue generated by individual segments of the Krka Group are presented in terms of customers’ geographical location. The data are calculated based on revenue and expenses, assets and liabilities directly attributable to each Krka Group market. Eliminations relate to transactions between the controlling company and subsidiaries and to transactions between subsidiaries.
Segment capital expenditure is the total cost incurred during the period to acquire property, plant and equipment, and intangible assets.
The following are the standards, amendments, and interpretations that have not yet become effective by the date of the Krka Group’s financial statements. The Krka Group will take them into account when they become effective. The Krka Group did not adopt any of these standards, amendments, or interpretations prior to their effective date.
IAS 21 was amended to clarify:
The amendments also include additional disclosure requirements to help users assess the impact of using an estimated exchange rate on the financial statements.
The management has assessed the impact of the amendments and believes they will have no significant impact on the consolidated financial statements of the Krka Group.
Effective for annual reporting periods beginning on or after 1 January 2026. Earlier application is permitted.
There has been diversity in practice over the timing of the recognition and derecognition of financial assets and financial liabilities, particularly when they are settled using electronic payment systems. The amendments to IFRS 9 clarify when a financial asset or a financial liability is recognised and derecognised.
Under the amendments, a company generally derecognises its trade payable on the settlement date. Usually this is the date on which payment is completed.
The amendments also provide an optional exception, which allows the company to derecognise its trade payable earlier than the settlement date, potentially on the date when payment is initiated and cannot be cancelled. The exception is available when the company uses an electronic payment system that meets all of the following criteria:
Companies can choose to apply the exception for electronic payments on a system-by-system basis.
Under IFRS 9, it was unclear whether the contractual cash flows of some financial assets with ESG-linked features represented SPPI, which is a condition for measurement at amortised cost. This could have resulted in financial assets with ESG-linked features being measured at fair value through profit or loss.
The amendments introduce an additional SPPI test for financial assets with contingent features that are not related directly to a change in basic lending risks or costs – e.g. where the cash flows change depending on whether the borrower meets an ESG target specified in the loan contract.
Under the amendments, certain financial assets including those with ESG-linked features could now meet the SPPI criterion, provided that their cash flows are not significantly different from an identical financial asset without such a feature.
The amendments also include additional disclosures for all financial assets and financial liabilities that have certain contingent features that are:
The amendments clarify the key characteristics of CLIs and how they differ from financial assets with non-recourse features. The amendments also include factors that a company needs to consider when assessing the cash flows underlying a financial asset with non-recourse features (the ‘look through’ test).
The amendments require additional disclosures for investments in equity instruments that are measured at fair value with gains or losses presented in other comprehensive income (FVOCI).
The management has assessed the impact of the amendments and believes they will have no significant impact on the consolidated financial statements of the Krka Group.
Effective for annual reporting periods beginning on or after 1 January 2026. Earlier application is permitted.
The amendments enable nature-dependent electricity contracts, which are sometimes referred to as renewable power purchase agreements (PPAs), to be better reflected in the financial statements. The amendments:
The management has assessed the impact of the amendments and believes they will have no significant impact on the consolidated financial statements of the Krka Group.
Effective for annual reporting periods beginning on or after 1 January 2027. Earlier application is permitted.
IFRS 18 replaces IAS 1 – Presentation of Financial Statements. The major changes in the requirements are summarised below.
IFRS 18 introduces newly defined ‘operating profit’ and ‘profit or loss before financing and income tax’ subtotals and a requirement for all income and expenses to be allocated between three new distinct categories based on a company’s main business activities: operating, investing and financing.
Under IFRS 18, companies are no longer permitted to disclose operating expenses only in the notes. A company presents operating expenses in a way that provides the ‘most useful structured summary’ of its expenses by either:
If any operating expenses are presented by function, then new disclosures apply.
IFRS 18 also requires some ‘non-GAAP’ measures to be reported in the financial statements. It introduces a narrow definition for Management Performance Measures (“MPMs”), requiring them to be:
For each MPM presented, companies need to explain in a single note to the financial statements why the measure provides useful information, how it is calculated and reconcile it to an amount determined under IFRS Accounting Standards.
The new standard includes enhanced guidance on how companies group information in the financial statements. This includes guidance on whether information is included in the primary financial statements or is further disaggregated in the notes.
Companies are discouraged from labelling items as ‘other’ and are required to disclose more information if they continue to do so.
sets operating profit as a starting point for the indirect method of presenting cash flows from operating activities and eliminates the option for classifying interest and dividend cash flows as operating activities in the cash flow statement (this differs for companies with specified main business activities). It also requires goodwill to be presented as a new line item on the balance sheet.
In its annual financial statements prepared for the period in which the new standard is first applied, an entity shall disclose, for the comparative period immediately preceding that period, a reconciliation for each line item in the statement of profit or loss between:
The management has assessed the impact of the amendments on the Krka Group’s consolidated financial statements and shall apply them upon enforcement.
Effective for annual reporting periods beginning on or after 1 January 2027. Earlier application is permitted.
IFRS 19 allows eligible subsidiaries to apply IFRS Accounting Standards with the reduced disclosure requirements of IFRS 19.
A subsidiary may choose to apply the new standard in its consolidated, separate or individual financial statements provided that, at the reporting date:
A subsidiary applying IFRS 19 is required to clearly state in its explicit and unreserved statement of compliance with IFRS Accounting Standards that IFRS 19 has been adopted.
The management has assessed the impact of the amendments and believes they will have no significant impact on the consolidated financial statements of the Krka Group.
Effective for annual reporting periods on or after 1 January 2026. Earlier application is permitted. The amendment on derecognition of lease liabilities applies only to lease liabilities extinguished on or after the beginning of the annual reporting period in which the amendment is first applied.
In this volume of improvements, the IASB makes minor amendments to IFRS 9 Financial Instruments and to a further four accounting standards1. The amendments to IFRS 9 address:
The amendments to IFRS 9 require companies to initially measure a trade receivable without a significant financing component at the amount determined by applying IFRS 15. They also clarify that when lease liabilities are derecognised under IFRS 9, the difference between the carrying amount and the consideration paid is recognised in profit or loss.
The management has assessed the impact of the amendments and believes they will have no significant impact on the consolidated financial statements of the Krka Group.
Effective date deferred indefinitely. Available for optional adoption in full IFRS financial statements. The European Commission decided to defer the endorsement indefinitely; it is unlikely that the EU will endorse it in the foreseeable future.
The amendments clarify that in a transaction involving an associate or joint venture, the extent of gain or loss recognition depends on whether the assets sold or contributed constitute a business, such that:
The management has assessed the impact of the amendments and believes they will have no significant impact on the consolidated financial statements of the Krka Group.
The Krka Group reports in terms of certain geographical segments. Revenue generated by individual segments are presented in terms of customers’ geographic allocation. The data are calculated based on revenue and expenses, assets and liabilities directly attributable to each Krka Group market. Eliminations relate to transactions between the controlling company and subsidiaries and to transactions between subsidiaries themselves.
| € thousand | European Union | South-Eastern Europe | Eastern Europe | Total segment reporting | Other | Eliminations | Total |
|---|---|---|---|---|---|---|---|
| 2024 | 1,025,384 | 108,419 | 650,523 | 1,784,326 | |||
| 2023 | 1,001,139 | 101,354 | 594,092 |
| Revenue from sales to intra-group customers | 1,696,585 | 125,218 | 109,806 | 1,909,544 | 1,806,391 | |||
|---|---|---|---|---|---|---|---|---|
| Total revenue | 1,457,228 | 1,424,128 | 179,080 | 170,496 | 1,301,330 | 1,198,978 | 2,937,638 | 2,793,602 |
| Other operating income | 5,869 | 4,502 | 80 | 481 | 729 | 576 | 6,678 | 5,559 |
| Operating expenses | –878,833 | –871,111 | –76,958 | –73,142 | –435,992 | –383,608 | –1,391,783 | –1,327,861 |
| Intra-group operating expenses, including elimination of profits | –431,843 | –422,990 | –70,661 | –69,142 | –650,808 | –604,885 | –1,153,312 | –1,097,017 |
| Operating profit | 152,421 | 134,529 | 31,541 | 28,693 | 215,259 | 211,061 | 399,221 | 374,283 |
| Interest income | 11,932 |
| 8,804 | 1 | 12 | 1,027 | 1,100 | 12,960 | 9,916 | 1,146 | 1,317 | 14,106 | 11,233 |
|---|---|---|---|---|---|---|---|---|---|---|
| Intra-group interest income | 4,457 | 4,123 | 0 | 0 | 0 | 0 | 4,457 | 4,123 | 0 | 0 |
| –4,457 | –4,123 | Interest expenses | –201 | –335 | –14 | |||||
| –15 | –226 | –114 | –441 | –464 | –20 | –10 | –461 | –474 | ||
| Intra-group interest expenses | –4,457 | –4,123 | 0 | 0 | 0 | 0 | –4,457 | –4,123 | 0 | –1 |
| 4,457 | 4,124 | Net financial result | 18,147 | 13,795 | –228 | |||||
| 255 | –33,343 | –44,553 | –15,424 | –30,503 | 6,930 | –1,992 | –8,494 | –32,495 | ||
| Income tax expense | –27,639 | –19,827 | –4,891 | –3,163 | –25,962 | –27,852 | –58,492 | –50,842 | –4,384 | –2,552 |
| –62,876 | –53,394 | Net profit | 142,929 | 128,497 | 26,422 | |||||
| 25,785 | 155,954 | 138,656 | 325,305 | 292,938 | 30,897 | 20,794 | 0 | 0 | ||
| 356,202 | 313,732 | Investments | 107,642 |
| 31 Dec 2024 | 31 Dec 2023 | |
|---|---|---|
| Total assets | 2,078,751 | 2,072,570 |
| Non-current assets exclusive of deferred tax assets | 854,447 | 886,473 |
| Depreciation of property, plant and equipment | 57,773 | 67,146 |
| Depreciation of the right-of-use assets | 3,094 | 3,045 |
| Amortisation of intangible assets | 4,129 | 4,229 |
| Total liabilities | 2,732,436 | 2,663,083 |
| € thousand | 2024 | 2023 |
|---|---|---|
| Revenue from contracts with customers (products) | 1,850,497 | 1,751,273 |
| Revenue from contracts with customers (health resort and tourist services) | 49,351 | 47,696 |
| Revenue from contracts with customers (materials) | 6,189 | 2,904 |
| Total revenue from contracts with customers | 1,906,037 | 1,801,873 |
Total revenue from contracts with customers under spa and tourist services were generated in Slovenia.
| € thousand | 2024 | 2023 |
|---|---|---|
| Region Slovenia | 71,653 | 66,081 |
| Region South-East Europe | 269,025 | 249,330 |
| Region East Europe | 650,339 | 593,951 |
| Region Central Europe | 426,530 | 397,079 |
| Region West Europe | 351,803 | 369,624 |
| Region Overseas Markets | 81,147 | 75,208 |
| Total | 1,850,497 | 1,751,273 |
We sold €96,042 thousand of products in 2024 in Ukraine, our third largest market (2023: €83,392 thousand), representing 5.1% of Krka Group's total sales.
We have sold €373,301 thousand of products in 2024 in the Russian Federation, which is Krka's largest individual market (2023: €346,751 thousand), representing 19.6% of Krka's total sales. Demand for our products is adequate.
| € thousand | 2024 | 2023 |
|---|---|---|
| Prescription pharmaceuticals | 1,567,359 | 1,469,381 |
| Non-prescription products | 171,291 | 177,252 |
| Animal health products | 111,847 | 104,640 |
| Total | 1,850,497 | 1,751,273 |
Trade receivables are outlined in Note 17 – Trade and other receivables, while liabilities from contracts with customers in Note 24 – Current liabilities from contracts with customers. The Krka Group recognised assets from contracts with customers in the amount of €291 thousand (2023: €210 thousand) and liabilities from contracts in the amount of €5,099 thousand (2023: €8,108 thousand). The recognised assets and liabilities under contracts with customers are set out in the consolidated statement of financial position.
22
23
The Krka Group develops, produces, markets and sells human health products (prescription pharmaceuticals, non-prescription products), animal health products, and health resort and tourist services. Revenue from contracts with customers is recognised when control of the goods and services is transferred to the customer at an amount that reflects the consideration to which Krka expects to be entitled in exchange for those goods or services, while considering specific terms and conditions of an individual contract.
Transfer of control and rewards in the sale of products for human use, veterinary products and material depends on the terms and conditions of an individual contract. Generally, it occurs when the customer accepts the goods in accordance with the provisions of Incoterms. The transfer of risks and rewards in the sale of health resort and tourist services occurs progressively as the customer acquires and consumes the benefits of the obligation at the same time as the obligation is being performed. Payment terms vary from region to region (distribution channels), while the standard credit term ranges from 30 to 120 days.
At year-end, the Krka Group did not incur any costs related to acquiring or fulfilling contracts with customers that could be recognised as assets.
| € thousand | 2024 | 2023 |
|---|---|---|
| Reversal of non-current provisions | 634 | 310 |
| Reversal of deferred income | 729 | 840 |
| Gains on sale of property, plant and equipment and intangible assets | 2,285 | 1,971 |
| Other operating income | 3,482 | 3,026 |
| Total other operating income | 7,130 | 6,147 |
The Group's other operating income also includes income from emission coupons obtained free of charge from the State in 2023 and transferred in 2024. See Note 12 – Intangible assets.
Deferred income relates to income from other government grants received that cover the depreciation charged on property, plant, and equipment in the proportion in which the funds were received.
| € thousand | 2024 | 2023 |
|---|---|---|
| Cost of goods and materials | 504,054 | 451,274 |
| Cost of services | 272,673 | 263,408 |
| Employee benefits expense | 568,509 | 529,400 |
| Amortisation and depreciation | 92,513 | 104,594 |
| Net write-offs and allowances for inventories | 18,794 | 11,420 |
| Net impairments and write-offs of receivables | –2,197 | –3,712 |
| Formation of provisions for lawsuits | 7,559 | 15 |
| Other operating expenses | 44,347 | 41,747 |
| Total costs | 1,506,252 | 1,398,146 |
| Change in the value of inventories of finished products and work in progress | –17,150 | 14,771 |
| Total | 1,489,102 | 1,412,917 |
The largest items in the cost of services refer to intellectual and personal services, promotional events, advertising and entertainment, and transport services.
More information on depreciation is disclosed in Note 11 – Property, plant and equipment and Note 12 – Intangible assets.
Estimated useful lives are disclosed in Note 2 – Significant accounting policies, Property, plant and equipment and Intangible assets.
| € thousand | 2024 |
|---|---|
| € thousand | 2024 | 2023 |
|---|---|---|
| Gross wages and salaries and continued pay | 437,485 | 410,174 |
| Social security contributions | 29,628 | 29,217 |
| Pension insurance contributions | 61,414 | 55,914 |
| Payroll tax | 815 | 773 |
| Post-employment benefits and other non-current employee benefits | 11,043 | 7,748 |
| Other employee benefits expense | 28,124 | 25,574 |
| Total employee benefits expense | 568,509 | 529,400 |
Post-employment benefits and other non-current employee benefits are detailed in Note 21–Provisions. The item ‘Other employee benefits expense’ refers mostly to vacation bonuses and commuting allowances.
| € thousand | 2024 | 2023 |
|---|---|---|
| Grants and assistance for humanitarian and other purposes | 2,062 | 3,166 |
| Environmental protection expenditures | 7,745 | 6,387 |
| Other taxes and levies | 26,234 | 26,214 |
| Loss on sale and write-offs of property, plant and equipment and intangible assets | 3,042 | 1,515 |
| Other operating expenses | 5,264 | 4,465 |
| Total other operating expenses | 44,347 | 41,747 |
Other levies include €22,242 thousand (2023: €21,604 thousand) of various taxes and levies paid on pharmaceuticals and fees paid to associates in individual foreign countries for pursuing promotional activities.
| € thousand | 2024 | 2023 |
|---|---|---|
| Interest income | 14,106 | 11,233 |
| Derivative income | 10,066 | 4,277 |
| –Realised revenue | 1,959 | 4,277 |
| –Fair value change | 8,107 | 0 |
| Income from other financial instruments | 8,983 | 7,245 |
| –Income generated | 9,683 | 3,220 |
| –Fair value change | –700 | 4,025 |
| Income from dividends | 760 | 808 |
| Other financial income | 31 | 4 |
| Total financial income | 33,946 | 23,567 |
| Net foreign exchange differences | –31,307 | –38,319 |
| Interest expenses | –461 | –474 |
| –Interest paid | 20 |
| Adjustment to the effective tax rate | € thousand | 2024 | 2023 |
|---|---|---|---|
| Current income tax | 71,759 | 52,842 | |
| Deferred tax | –9,033 | –227 | |
| Other income tax | 133 | 779 | |
| Top-up tax | 17 | / | |
| Total income tax | 62,876 | 53,394 | |
| Profit before tax | 419,078 | 367,126 | |
| Income tax calculated at the rate of 19% | / | 69,754 | |
| Income tax calculated at the rate of 22% | 92,197 | / | |
| Tax on non-deductible income | –2,550 | 28 | |
| Tax on non-deductible expenses | 8,180 | 9,559 | |
| Income tax from tax incentives | –25,127 | –20,939 | |
| Tax on expenses/income, which were non-deductible for taxable purposes in the previous years | –1,849 | –1,922 | |
| Effect of different tax rates (current income tax) | –7,052 | –2,632 | |
| Other | –1,073 | –1,233 | |
| Other income tax expenses | 133 | 779 | |
| Top-up tax | 17 | 0 | |
| Total income tax expense | 62,876 | 53,394 |
Investments in R&D and investment incentives represent the major share of tax incentives.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Land | 65,317 | 64,368 |
| Buildings | 334,182 | 353,495 |
| Equipment | 317,045 | 292,123 |
| Property, plant and equipment being acquired | 77,460 | 68,666 |
| Right-of-use assets | 12,642 | 11,693 |
| Total property, plant and equipment | 806,646 | 790,345 |
In 2024, most of the controlling company's investments were earmarked for renovating the Notol packaging plant in the amount of €15,957 thousand (2023: €14,713 thousand), for IT and telecommunications projects in the amount of €12,422 thousand (2023: €9,742 thousand) and for Sinteza 2 in Krško in the amount of €8,359 thousand (2023: €376 thousand). In Notol, €6,641 thousand (2023: €12 thousand) were allocated for upgrading the granulation capacity and €5,662 thousand (2023: €208 thousand) for the modernisation of the logistics system.
Regarding investments in subsidiaries, the largest amount was spent on renovating the facilities at Terme Krka i.e. €8,570 thousand (2023: €2,090 thousand). We allocated €2,597 thousand (new investment in 2024) for renovating TAD Pharma's premises and €1,431 thousand (2023: €1,580 thousand) for expanding the production capacity of the Krka-Rus subsidiary in the Russian Federation.
The majority of the right-of-use asset refers to the right of using assets relating to buildings in the amount of €10,761 thousand (2023: €8,194 thousand).
| € thousand | Land | Buildings | Equipment | PPE being acquired | Right-of-use assets | Total | |
|---|---|---|---|---|---|---|---|
| Purchase cost | Balance at 1 Jan 2023 | 40,721 | 884,052 | 1,273,113 | 76,139 | 21,814 | 2,295,839 |
| Additions | 0 | 0 | 0 | 122,747 | 0 | 122,747 | |
| Capitalisations – transfer from PPE being acquired | 23,756 | 33,401 | 69,071 | –126,228 | 0 | 0 | |
| Capitalisations – IFRS 16 Leases | 0 | 0 | 0 | 0 | 4,501 | 4,501 | |
| Disposals, impairments, deficit, surplus | 20 | –1,126 | –35,134 | 0 | –1,100 | –37,340 | |
| Translation reserve | –129 | –14,233 | –14,230 | –3,992 | –394 |
| 31 Dec 2023 | 1 Jan 2024 | Additions | Capitalisations – transfer from PPE being acquired | Capitalisations – IFRS 16 Leases | Disposals, impairments, deficit, surplus | Translation reserve | Transfers, reclassifications | 31 Dec 2024 | |
|---|---|---|---|---|---|---|---|---|---|
| Balance | 64,368 | 64,368 | 0 | 1,053 | 0 | –26 | –78 | 0 | 65,317 |
| Transfers, reclassifications | 0 | 0 | 0 | 14,249 | 0 | –2,866 | –9,489 | –9 | 904,303 |
| Balance | 902,418 | 902,418 | 0 | 83,177 | 0 | –41,471 | –9,890 | 22 | 1,324,252 |
| Balance | 68,666 | 68,666 | 109,462 | –98,478 | 0 | –1,246 | –944 | 0 | 77,460 |
| Balance | 24,821 | 24,821 | 0 | 0 | 5,824 | –2,809 | –421 | 0 | 27,415 |
| Total | 2,352,687 | 2,352,687 | 109,462 | 0 | 5,824 | –48,418 | –20,822 | 13 | 2,398,747 |
| 1 Jan 2023 | Depreciation | Disposals, impairments, deficit, surplus | |
|---|---|---|---|
| Balance | 0 | –527,268 | 0 |
| Balance | –978,805 | –66,782 | 35,036 |
| Total | –1,516,503 | –97,396 |
| 2023 | 2024 | Total | ||||
|---|---|---|---|---|---|---|
| Balance at 31 Dec 2023 | 0 | –548,923 | –1,000,291 | 0 | –13,128 | –1,562,342 |
| Balance at 1 Jan 2024 | 0 | –548,923 | –1,000,291 | 0 | –13,128 | –1,562,342 |
| Depreciation | 0 | –27,046 | –54,781 | 0 | –3,869 | –85,696 |
| Disposals, impairments, deficit, surplus | 0 | 2,639 | 40,973 | 0 | 2,031 | 45,643 |
| Transfers, reclassifications | 0 | 5 | –27 | 0 | 0 | –22 |
| Translation reserve | 0 | 3,204 | 6,919 | 0 | 193 | 10,316 |
| Balance at 31 Dec 2024 | 0 | –570,121 | –1,007,207 | 0 | –14,773 | –1,592,101 |
| Balance at 1 Jan 2023 | Balance at 31 Dec 2023 | Balance at 1 Jan 2024 | Balance at 31 Dec 2024 | |
|---|---|---|---|---|
| Total | 40,721 | 64,368 | 64,368 | 65,317 |
| Column 2 | 356,784 | 353,495 | 353,495 | 334,182 |
| Column 3 | 294,308 | 292,123 | 292,123 | 317,045 |
| Column 4 | 76,139 | 68,666 | 68,666 | |
| Column 5 | 11,384 | 11,693 | 11,693 | |
| Total | 779,336 | 790,345 | 790,345 |
77,460
12,642
806,646
The change in 2024 depreciation rates results in a lower depreciation expense by €13,260 thousand at the Krka Group level (whereof €10,267 thousand at the Company level and €2,993 thousand at the level of Group companies). The effect of the change will continue to be reflected in a lower depreciation charge also in future years. In the 2025–2029 period and beyond, this cost is expected to decrease mainly due to the company Krka by an average of €8,204 thousand per year.
In 2023 and 2024, the Krka Group did not carry out any investments that would meet the criteria for allocating borrowing costs.
All property, plant and equipment is free of encumbrances. The status of known future commitments related to the acquisition of property, plant and equipment is disclosed in Note 26 – Contingent liabilities and commitments. The movements and lease liabilities recognised in profit or loss are presented in Notes 27 – Leases and 29 – Financial instruments and financial risks.
The impairment indicator analysis showed that as at 31 December 2024 no indicators existed that would trigger the need to perform impairment testing of assets allocated to cash-generating units. There were no significant deteriorations in market interest rates that adversely affected the discount rate in 2024 compared to the previous year, nor significant changes in the technological, market, economic or legal environment, significant changes in the volume or manner of use of assets with an adverse impact, and no planned reorganisations and disposals of assets, or other evidence of reduced economic performance of the assets.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Goodwill | 42,644 | 42,644 |
| Trademark | 32,305 | 33,176 |
| Software | 15,795 | 15,556 |
| Other intangible assets | 7,741 | 7,592 |
| – Long-term deferred operating costs | 185 | 252 |
| – Development-related projects | 4,389 | 4,478 |
| – Emission coupons | 3,167 | 2,862 |
| Intangible assets being acquired | 2,262 | 3,380 |
| Total intangible assets | 100,747 | 102,348 |
Goodwill arose on the acquisition of subsidiaries TAD Pharma in Germany (€42,277 thousand) and Krka Pharma in Austria (€367 thousand). The trademark item refers mainly to the trademark of TAD Pharma (€32,226 thousand).
The Krka Group recognises emission coupons acquired free of charge from the State and purchased on the market as other intangible assets. In 2024, the Krka Group acquired 34,736 coupons, whereof 9,736 were free emission coupons (2023: 9,736) to be transferred to the State in 2025 and 25,000 were purchased on the market at a value of €1,563 thousand. In 2024, it transferred 25,353 emission coupons, whereof 9,736 were acquired free of charge and 15,617 were purchased on the market at the value of €1,257 thousand. The transferred emission coupons were acquired in 2023, and their transfer was carried out using the FIFO method. As at 31 December 2024, the Krka Group had 55,499 emission coupons in the total amount of €3,167 thousand (46,116 emission coupons with a value of €2,862 thousand as at 31 December 2023). The Krka Group transfers more emission coupons during the year than it receives free of charge from the State and is therefore considered a net contributor.
| € thousand | Goodwill | Trademark | Concessions, trademarks and licences | Other IA | IA being acquired | Total | |
|---|---|---|---|---|---|---|---|
| Purchase cost | Balance at 1 Jan 2023 | 42,644 | 42,629 | 79,125 | 64,592 | 3,706 | 232,696 |
| Additions | 0 | 0 | 0 | 0 | 9,185 |
| Transfer from IA being acquired | 0 | 0 | 5,524 | 3,385 | –8,909 | 0 | |
|---|---|---|---|---|---|---|---|
| Disposals, deficit, surplus | 0 | 0 | –3,063 | –5,787 | –596 | –9,446 | |
| Transfers, reclassifications | 0 | 0 | 841 | –843 | 0 | –2 | |
| Translation reserve | 0 | 0 | –38 | –422 | –6 | –466 | |
| Balance at 31 Dec 2023 | 42,644 | 42,629 | 82,389 | 60,925 | 3,380 | 231,967 | |
| Balance at 1 Jan 2024 | 42,644 | 42,629 | 82,389 | 60,925 | 3,380 | 231,967 | |
| Additions | 0 | 0 | 0 | 0 | 7,587 | 7,587 | |
| Transfer from IA being acquired | 0 | 0 | 4,993 | 3,096 | –8,089 | 0 | |
| Disposals, deficit, surplus | 0 | 0 | –867 | –2,987 | –617 | –4,471 | |
| Transfers, reclassifications | 0 | 0 | 9 | 0 | 0 | 9 | |
| Translation reserve | 0 | 0 | –47 | 17 | 1 | –29 | |
| Balance at 31 Dec 2024 | 42,644 | 42,629 | 86,477 | 61,051 | 2,262 | 235,063 | |
| Accumulated amortisation | Balance at 1 Jan 2023 | 0 | –8,582 | –64,440 | –57,124 | 0 | –130,146 |
| 2023 | 2024 | |
|---|---|---|
| Amortisation | –871 | –871 |
| –4,659 | –4,732 | |
| –1,668 | –1,214 | |
| 0 | 0 | |
| Total | –7,198 | –6,817 |
| Disposals, deficit, surplus | 0 | 0 |
|---|---|---|
| 3,059 | 862 | |
| 4,272 | 1,254 | |
| 0 | 0 | |
| Total | 7,331 | 2,116 |
| Transfers, reclassifications | 0 | 0 |
|---|---|---|
| –821 | –1 | |
| 825 | 0 | |
| 0 | 0 | |
| Total | 4 | –1 |
| Translation reserve | 0 | 0 |
|---|---|---|
| 28 | 22 | |
| 362 | –17 | |
| 0 | 0 | |
| Total | 390 | 5 |
| 0 | –9,453 | –66,833 | –53,333 | 0 | –129,619 | |
|---|---|---|---|---|---|---|
| 0 | –9,453 | –66,833 | –53,333 | 0 | –129,619 | |
|---|---|---|---|---|---|---|
| 0 | –10,324 | –70,682 | –53,310 | 0 | –134,316 | |
|---|---|---|---|---|---|---|
| Balance at 1 Jan 2023 | 42,644 | 34,047 | 14,685 | 7,468 | 3,706 | 102,550 |
|---|---|---|---|---|---|---|
| Balance at 31 Dec 2023 | 42,644 | 33,176 | 15,556 | 7,592 | 3,380 | 102,348 |
| Balance at 1 Jan 2024 |
For the purpose of impairment testing, goodwill arising on the acquisition of TAD Pharma amounting to €42,277 thousand has been allocated to two cash-generating units (CGUs) i.e. to CGU TAD Pharma in the amount of €10,612 thousand and to CGU Krka (controlling company) in the amount of €31,665 thousand.
The recoverable amount of the CGU TAD Pharma is based on the value in use calculated by discounting the future cash flows generated by the continued use of the CGU. The five-year financial plans of CGU TAD Pharma were used, projecting the average five-year change in earnings before interest, taxes, amortisation of 4.3% (a five-year average growth rate of -0.1% was projected for 2023), a discount rate of 7.8% (2023: 7.3%) and an annual growth rate of 2.0% in the residual value of free cash flow (2023: 2.0% as well). The annual growth rate of free cash flow was calculated based on long-term inflation estimates. The values set for the key assumptions represent management's best estimate of future trends in the industry and are based on historical data obtained from internal and external sources.
The estimated recoverable amount of the CGU exceeds its carrying amount, and no impairment of the CGU is required.
The recoverable amount of the CGU Krka is based on the value in use calculated by discounting the future cash flows generated by the continued use of the CGU. The five-year financial plans of CGU Krka were used, projecting the average five-year growth in earnings before interest, taxes, amortisation of 3.6% (a five-year average growth rate of 4.7% was projected for 2023), a discount rate of 8.1% (2023: 7.7%) and an annual growth rate of 2.0% in the residual value of free cash flow (2023: 2.0% as well). The annual growth rate of free cash flow was calculated based on long-term inflation estimates. The values set for the key assumptions represent management's best estimate of future trends in the industry and are based on historical data obtained from internal and external sources.
The estimated recoverable amount of the CGU exceeds its carrying amount and no impairment of the CGU is required.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Non-current loans | 35,330 | 70,098 |
| – Loans to others | 35,330 | 40,098 |
| – Deposits granted to banks | 0 | 30,000 |
| Current loans | 10,506 | 58,719 |
| – Portion of non-current loans maturing next year | 9,970 | 6,956 |
| – Loans to others | 20 | 13 |
| – Deposits granted to banks | 2 | 50,002 |
| – Current interest receivables | 514 | 1,748 |
| Total loans | 45,836 | 128,817 |
As at 31 December 2024, the Krka Group had no deposits with a maturity of more than one year (the deposits’ amount as at 31 December 2023 was €30,000 thousand) and no deposits with a maturity of more than 90 days and less than one year (the deposits’ amount as at 31 December 2023 was €50,000 thousand).
Non-current loans include a loan by a subsidiary in China for the construction of a production plant for an amount of €22,766 thousand (2023: €28,659 thousand), as well as housing loans granted by the controlling company and certain subsidiaries to employees in accordance with the internal rules. The loan in China has a maturity of 7 years from the first disbursement and a grace period for repayment of 2.5 years from the first disbursement. The loan is secured by a guarantee from Ningbo Menovo Pharmaceutical Co. Ltd., which is the owner of the borrowing company Ningbo Menovo Tiankang Pharmaceutical Co., Ltd, and a mortgage on the borrower's immovable property.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Non-current investments | 22,024 | 47,674 |
| – Investments at fair value through OCI (equity instruments) | 22,024 | 26,901 |
| – Investments at amortised cost (debt instruments) | 0 |
| Current investments including derivatives | €20,773 |
|---|---|
| Total investments | €271,818 |
| –Investments at fair value through profit or loss | €224,110 |
| –Investments at amortised cost (debt instruments) | €20,231 |
| –Derivatives | €5,453 |
Non-current investments at fair value through other comprehensive income comprised €1,137 thousand of investments in shares and interests in companies in Slovenia (2023: €954 thousand) and €20,887 thousand of investments in shares of foreign operations i.e. companies located abroad (2023: €25,947 thousand).
Current investments at amortised cost included investments in foreign government bonds in the amount of €20,231 thousand (2023: €63,985 thousand), while there were no investments in Slovenian government bonds in 2024 (2023: €6,033 thousand). These are bonds with a maturity of less than one year and a credit risk rating corresponding to the globally understood definition of upper medium grade.
Investments at fair value through profit or loss represent investments in treasury bills of EU countries with a high credit rating that meets the globally understood definition of investment grade. 49% of the treasury bill portfolio is of high grade and 51% belongs to the prime investment grade.
The decrease in investments at amortised cost of €71,136 thousand is due to the maturity of government bonds. The increase in investments at fair value through profit or loss amounting to €465,295 thousand includes acquisitions of treasury bills, and the decrease of €477,236 thousand includes disposals of treasury bills due to their maturity.
| € thousand | Financial assets at fair value through OCI | Investments at amortised cost | Investments at fair value through profit or loss |
|---|---|---|---|
| Balance at 1 Jan 2023 | 15,989 | 145,478 | 0 |
| Increase | 0 | 2,103 | 571,826 |
| Decrease | 0 | –53,311 | –339,100 |
| Foreign exchange differences | 0 | –3,479 | 0 |
| Adjustment to market value | 10,912 | / | 4,025 |
| Balance at 31 Dec 2023 | 26,901 | 90,791 | 236,751 |
| Balance at 1 Jan 2024 | 26,901 | 90,791 | 236,751 |
| Increase | 0 | 1,811 | 465,295 |
| Decrease | 0 | –71,136 | –477,236 |
| Foreign exchange differences | 0 | –1,235 | 0 |
| Adjustment to market value | –4,877 | 0 | –700 |
| Balance at 31 Dec 2024 | 22,024 | 20,231 | 224,110 |
€ thousand
| Assets | Liabilities | 2024 | 2023 | 2024 | 2023 | |
| Investments, property, plant and equipment and intangible assets | 239 | 340 | 11,840 | 11,544 | ||
| Investments at fair value through OCI | 1,978 | 1,978 | 4,211 | 5,284 | ||
| Inventories | 38,148 | 29,139 | 0 | 0 | ||
| Receivables | 11,574 | 11,376 | 237 | 145 | ||
| Dividends | 0 | 1,800 | 0 | 0 | ||
| Provisions for post-employment benefits and other non-current employee benefits | 8,128 | 9,117 | 0 | 0 | ||
| Transfer of tax loss | 44 | 225 | 0 | 0 | ||
| Total | 60,111 | 53,975 | 16,288 | 16,973 | ||
| Offsetting | –5,677 | –6,247 | –5,677 | –6,247 | ||
| Net | 54,434 | 47,728 | 10,611 | 10,726 |
| € thousand | Balance at 1 Jan 2023 | Recognised in income statement | Translation reserve | Recognised in OCI | Balance at 31 Dec 2023 | Recognised in income statement | Translation reserve | Recognised in OCI | Balance at 31 Dec 2024 |
|---|---|---|---|---|---|---|---|---|---|
| Investments, property, plant and equipment and intangible assets | –11,593 | 286 | 103 | 0 | –11,204 | –490 | 93 |
| 31 Dec 2024 | 31 Dec 2023 | |
|---|---|---|
| Investments at fair value through OCI | –11,601 | –782 |
| Inventories | 34,540 | –3,862 |
| –1,539 | 0 | |
| 29,139 | 10,264 | |
| –1,255 | 0 | |
| Receivables | 11,766 | 1,582 |
| –2,117 | 0 | |
| 11,231 | 1,863 | |
| –1,757 | 0 | |
| 11,337 | ||
| Dividends | 33 | 1,767 |
| 0 | 0 | |
| 1,800 | –1,800 | |
| 0 | 0 | |
| Provisions for post-employment benefits and other non-current employee benefits | 8,704 | 303 |
| 11 | 99 | |
| 9,117 | –623 | |
| 3 | –369 | |
| 8,128 | ||
| Transfer of tax loss | 344 | –119 |
| 0 | 0 | |
| 225 | –181 | |
| 0 | 0 | |
| 44 | ||
| Total | 43,012 | 227 |
| –3,542 | –2,695 | |
| 37,002 | 9,033 | |
| –2,916 | 704 | |
| 43,823 |
Nounrecognised deferred tax on account of tax losses of subsidiaries existed in 2024 (as well as in 2023). The unrecognised deferred tax liability for unpaid dividends from subsidiaries is recorded at €19,450 thousand (2023: €18,552 thousand).
In 2023, deferred taxes were calculated using the revised tax rate in Slovenia, which increased from 19% to 22%. The relevant impact thereof amounted to €1,398 thousand.
| 31 Dec 2024 | 31 Dec 2023 | |
|---|---|---|
| Materials | 266,402 | 265,019 |
| Work in progress | 121,520 | 128,610 |
| Finished products | 180,986 |
|---|---|
| Merchandise | 32,783 |
| Advances for inventories | 36,917 |
| Total inventories | 638,608 |
The increase in inventories is the result of adapting to market conditions. By carefully planning our inventories and safety stocks, we ensure we always have access to the intermediate goods we require to produce our finished products. The planning of inventories of intermediate goods is based on sales forecasts. We also ensure optimal and adequate stocks of finished products throughout the distribution chain.
The net write-downs and write-offs of inventories recorded among operating expenses amounted in the reporting period to €18,794 thousand (2023: €11,420 thousand).
The Krka Group does not pledge inventories as collateral.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Current trade receivables | 552,710 | 509,070 |
| Current receivables due from others | 28,891 | 51,364 |
| Total receivables | 581,601 | 560,434 |
In 2024, the net amount of the write-offs and impairment of receivables disclosed in operating expenses amounted to –€2,197 thousand (2023: –€3,712 thousand).
More than 95% of trade receivables were insured with a credit insurer, by taking into account more than 85% of the deductible (more than 95% of trade receivables were insured as at 31 December 2023, by taking into account more than 80% of the deductible).
| € thousand | Gross value | Allowances for receivables | Net value at 31 Dec 2024 | Net value at 31 Dec 2023 |
|---|---|---|---|---|
| Trade receivables due from domestic customers | 13,455 | 30 | 13,425 | 12,585 |
| Trade receivables due from foreign customers | 572,636 | 32,152 | 540,484 | 497,115 |
| Deferred income from contracts with foreign customers | –1,199 | 0 | –1,199 | –630 |
| Total current trade receivables | 584,892 | 32,182 | 552,710 | 509,070 |
Current receivables due from others relate primarily to receivables due from the State. Income tax credits amounted to €1,021 thousand (2023: €22,885 thousand), while the remaining €14,734 thousand relate to other receivables due by the State (2023: €18,486 thousand).
Advances for services were recorded at €3,683 thousand (2023: €2,025 thousand).
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Cash in hand | 52 | 71 |
| Bank balances | 344,843 | 173,940 |
| Total cash and cash equivalents | 344,895 | 174,011 |
The Company's share capital of €54,732 thousand is represented by 32,793,448 ordinary no-par value shares. There is only one class of share. The share capital is fully paid in.
At the 29th Annual General Meeting on 6 July 2023, the Company’s Management Board was granted authorisation to purchase treasury shares. However, the total amount of treasury shares should not exceed 10% of the Company's share capital, i.e. 3,279,344 shares, whereby the total amount is inclusive of shares already held by Krka as at the date. The authorisation is valid for a period of 36 months from the date of the resolution’s adoption.
Krka is allowed to acquire treasury shares on the regulated securities market at respective market prices at any time. It may also acquire treasury shares outside the regulated securities market. When purchasing treasury shares on the regulated market, the purchase price must not be lower than the book value based on the respective latest publicly published audited financial statements of the Krka Group. Furthermore, the purchase price of the shares must not exceed 25-fold the earnings per share held by the majority stakeholders as calculated based on the latest publicly published audited consolidated income statement of the Krka Group.
Pursuant to Paragraphs 3 and 4, Article 381 of the ZGD-1, an entity may reduce the share capital by withdrawing all treasury shares in a simplified procedure and recognising the amount against other profit reserves.
| No. of shares | Weighted average share price (€) | Value of treasury shares (€ thousand) | |
|---|---|---|---|
| Balance at 31 Dec 2022 | 1,785,849 | 124,566 | |
| Repurchases in 2023 | 130,117 | 107.00 | 13,923 |
| Balance at 31 Dec 2023 | 1,915,966 | 138,489 | |
| Repurchases in 2024 | 191,371 | 130.65 | 25,002 |
| Balance at 31 Dec 2024 | 2,107,337 | 163,491 |
The repurchased treasury shares relate to repurchases that were recorded in individual years. A subscription fee is included in the weighted average price of shares. The amount paid, including commission, is deducted from the total capital as treasury shares until such shares are withdrawn, reissued or sold.
The repurchases of treasury shares in 2024 in terms of days are outlined in Note 35 – Repurchase of treasury shares to the financial statements of Krka, d. d., Novo mesto.
The Krka Group's reserves comprise reserves for treasury shares, the share premium, legal and statutory reserves, fair value reserves and translation reserves.
Reserves for treasury shares amounted as at the balance sheet date to €163,491 thousand and increased by €25,002 thousand based on their formation as a result of additional repurchase of treasury shares.
The share premium is to be used under the terms and purposes as defined by the applicable act. The share premium was reported at €105,897 thousand as at 31 December 2024 and consisted of the general equity revaluation adjustment of €90,659 thousand that was included in share premium during the transfer to IFRS; the share premium of €10,844 thousand formed pursuant to a special regulation applicable in the ownership transformation of the controlling company; and €4,394 thousand of share premium resulting from reduction in the share capital due to the withdrawal of treasury shares. The amount may be used solely to increase share capital. In 2024, the value of the share premium remained unchanged.
Legal reserves may be formed up to 30% of the share capital. They amounted to €14,990 thousand as at 31 December 2024 and remained unchanged compared to the previous period.
Statutory reserves amounted to €30,000 thousand as at the reporting date and remained unchanged over the previous period. The Krka Group forms statutory reserves up to a total of €30,000 thousand. Statutory reserves can be used for loss coverage, formation of reserves for treasury shares, decreasing share capital by share withdrawal, and regulating the dividend policy. Statutory reserves are available for drawdown.
The fair value reserve includes the cumulative change in the fair value of financial assets and post-employment benefits. Compared to the previous period, the fair value reserve decreased by €10,851 thousand and amounted to –€11,362 thousand as at 31 December 2024. The cumulative change is due to the increase in the fair value of financial assets through OCI (equity instruments) by €4,877 thousand, to the decrease as a result of restating post-employment benefits by €6,685 thousand, to an increase for the impact of deferred taxes by €704 thousand, and an increase of the translation reserve when restating post-employment effects by €7 thousand.
Compared to the previous period, the value of the translation reserve declined by €32,331 thousand and amounted to –€166,701 thousand as at 31 December 2024. The decrease occurred as a result of translating individual items in financial statements of foreign operations into the reporting currency.
Retained earnings grew based on the majority shareholder's profit of €356,986 thousand. On the other hand, they declined as a result of the allocation of accumulated profit to dividend payment amounting to €230,933 thousand in accordance with the resolution adopted by the 30th Annual General Meeting on 11 July 2024; an additional formation of reserves for treasury shares in total of €25,002 thousand on account of the share repurchase by the controlling company and changes in provisions for termination benefits amounting to –€1,741 thousand.
The dividend payout in 2024 reported in the statement of cash flows differs from the figure confirmed by the Annual General Meeting and reported in the statement of changes in equity by –€49 thousand (2023: €1 thousand).
In 2024, the declared gross dividend per share was €7.50 (2023: €6.60).
The following table summarises information about the company before any intra-group spin-offs.
| € thousand | 2024 | 2023 |
|---|---|---|
| Non-controlling interest | 40.0% | 40.0% |
| Non-current assets | 28,212 | 33,573 |
| Current assets | 26,134 | 20,385 |
| Non-current liabilities | –309 | –238 |
| Current liabilities | –5,034 | –4,443 |
| Net assets | 49,003 | 49,277 |
| Net assets attributable to the non-controlling interest | 19,601 | 19,711 |
| Revenue | 12,465 | 21,337 |
| Net profit | –1,961 | –534 |
| Other comprehensive income | 0 | 0 |
| Total comprehensive income | –1,961 | –534 |
| Net profit, attributable to the non-controlling interest | –784 | –214 |
| Other comprehensive income, attributable to the non-controlling interest | 674 | –1,289 |
Basic earnings per share amounted to €11.60 in 2024 and increased by 14% over the previous year when it amounted to €10.14. The calculation of earnings per share took into account the net profit for the period attributable to the controlling interests in the amount of €356,986 thousand (2023: €313,946 thousand). The weighted average number of shares was accounted for in the calculation for both years i.e. 30,783,449 shares for 2024, and 30,954,055 shares for 2023. The average number of shares is calculated from the daily share balances during the year, less treasury shares. Diluted earnings per share equal the basic earnings per share as the Krka Group has not issued any dilutive or contingently dilutive instruments.
| € thousand | Balance at 31 Dec 2023 | Formation | Utilisation | Reversal | Translation reserve | Balance at 31 Dec 2024 |
|---|---|---|---|---|---|---|
| Provisions for lawsuits | 10,582 | 7,559 | –10,150 | –393 | 0 | 7,598 |
| Provisions for post-employment benefits | 94,282 | 21,398 | –6,737 | –1,050 | 7 | 107,900 |
| Provisions for other non-current employee benefits | 19,004 | 3,728 | –1,559 | –312 | 4 | 20,865 |
| Other provisions | 530 | 412 | –410 | 0 | 0 |
| € thousand | Balance at 31 Dec 2022 | Formation | Utilisation | Reversal | Translation reserve | Balance at 31 Dec 2023 |
|---|---|---|---|---|---|---|
| Provisions for lawsuits | 10,597 | 0 | –1 | –14 | 0 | 10,582 |
| Provisions for post-employment benefits | 79,750 | 19,693 | –4,448 | –744 | 31 | 94,282 |
| Provisions for other non-current employee benefits | 16,209 | 4,408 | –1,415 | –216 | 18 | 19,004 |
| Other provisions | 679 | 560 | –620 | –89 | 0 | 530 |
| Total provisions | 107,235 | 24,661 | –6,484 | –1,063 | 49 | 124,398 |
The provisions for lawsuits referring to intellectual property are determined based on the noted amount of the indemnification claim or, if the claim has not yet been disclosed, on the estimated amount. Legal experts handling intellectual property disputes are engaged to determine the estimated amounts. Additionally, management reviews the calculated provisions for each unresolved claim annually.
In 2014, the European Commission found that Krka had infringed Article 101 of the Treaty on the Functioning of the EU, thereby distorting competition on the EU market for perindopril, and imposed a fine of €10,000 thousand on it. Krka paid the fine within the time limit set by the Commission. However, as it considered that its conduct did not infringe competition law rules, it brought an action against the decision before the EU General Court, which ruled in favour of Krka in December 2018.
The Commission has appealed the decision of the General Court of the EU to the European Court of Justice (ECJ) and Krka has formed a long-term provision of €10,000 thousand in December 2022.
In June 2024, the European Court of Justice ruled on the Commission's appeal against the decision of the General Court of the EU. The appeal was upheld, and the case was referred back to the EU General Court. Krka paid a fine of €10,000 thousand pursuant to the decision by using the provision it had established for this purpose.
The total amount of provisions recognised for lawsuits in 2024 amounts to €7,559 thousand, the most significant of which is a provision for a claim for damages in connection with the sale of perindopril in the amount of €6,000 thousand.
The Krka Group, along with other generic pharmaceutical companies, is engaged in litigation concerning potential damages arising from an identified infringement of competition rules. The Krka Group is exposed for €1,400 thousand in relation to the sale of rivaroxaban in Slovakia for a short period in early 2021 when the patent situation in that country was unclear.
In 2024, the Company and its subsidiaries were involved in 6 intellectual property disputes and 29 disputes in other areas of law (labour, compensation, administrative, etc.), of which the Company was involved in 12 disputes and its subsidiaries in total 23 disputes. The total value of the IP claims is estimated at €1,400 thousand and €8,000 thousand in other legal areas. The Krka Group has formed provisions for disputes amounting to €7,598 thousand.
Provisions for obligations to employees arising from post-employment and other non-current benefits are based on actuarial calculation using the following assumptions:
| € thousand | 2024 | 2023 |
|---|---|---|
| Balance at 1 Jan | 94,282 | 79,750 |
| Current service costs (CSC) | 9,204 | 4,683 |
| Interest cost (IC) | 3,772 | 3,113 |
| Post-employment benefits paid | –6,737 | –4,501 |
| Staff departures (reversal) | –1,047 | –735 |
| Actuarial surplus/deficit, whereof: | 8,426 | 11,972 |
| –Change in financial assumptions | 8,548 | 2,552 |
| –Experience | –122 | 9,420 |
| Balance at 31 Dec | 107,900 | 94,282 |
| Discount rate | Increase in wages and salaries | Change in percentage points | Change by | Impact on liabilities (€ thousand) |
|---|---|---|---|---|
| 0.5 | –0.5 | –7,464 | ||
| 8,270 | –7,558 |
| € thousand | Balance at 31 Dec 2023 | New deferred income received | Reversal of deferred income | Balance at 31 Dec 2023 |
|---|---|---|---|---|
| Grants received from the European Regional Development Fund and the budget of the Republic of Slovenia intended for the production of pharmaceuticals in the new Notol 2 Plant | 687 | 0 | –115 | 572 |
| Grants received from the budget for the Dolenjske and Šmarješke Toplice health resort and Golf Grad Otočec | 3,144 | 329 | –414 | 3,059 |
| Grants received from the European Regional Development Fund (Farma GRS) | 1,567 | 0 | –160 | 1,407 |
| Subsidy for acquisition of electric drive vehicles | 1 | 0 | 0 | 1 |
| Property, plant and equipment received free of charge | 14 | 10 | –7 | 17 |
| 10 | 10 | –10 | 10 |
|---|---|---|---|
| 90 | 0 | –2 | 88 |
|---|---|---|---|
| 1 | 0 | –1 | 0 |
|---|---|---|---|
| 0 | 7 | –1 | 6 |
|---|---|---|---|
| 33 | 0 | –33 | 0 |
|---|---|---|---|
| 0 | 11 | –11 | 0 |
|---|---|---|---|
| 0 | 512 | –18 | 494 |
|---|---|---|---|
| 5,547 | 879 | –772 | 5,654 |
|---|---|---|---|
The production of pharmaceuticals in the new Notol 2 Plant and Farma GRS project is partly funded by the EU through the European Regional Development Fund. The Notol project is delivered within the framework of the Operational Programme ‘Strengthening Regional Development Potentials’ for the period 2007–2013, Priority axis 1: Competitiveness and Research Excellence: main type of activity 1.1.: Improvement of Competitiveness and Research Excellence. The Farma GRS project was eligible for co-financing of costs under R&D projects, including project management and investment in research and development, and production activities.
The amounts of deferred income are decreased by the proportionate share of depreciation of assets to which the grants refer and by any other types of realised expenses.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Current trade payables | 148,285 | 153,762 |
| Payables to domestic suppliers | 50,266 | 57,459 |
| Payables to foreign suppliers | 98,019 | 96,303 |
| Total trade payables | 148,285 | 153,762 |
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Refund liabilities | 160,979 | 154,065 |
| – Bonuses and volume rebates | 159,148 | 152,347 |
| – Rights of return | 1,831 | 1,718 |
| Contract liabilities | 5,099 | 8,108 |
| – Contract liabilities– deferred income | 1,187 | 1,381 |
| – Contract liabilities– advances from other customers | 3,912 | 6,727 |
| Total current contract liabilities | 166,078 | 162,173 |
Accrued bonuses and volume discounts include discounts to which the customers are entitled when the relevant terms and conditions are fulfilled; these discounts are not granted to customers in the year of the sale. Bonuses and volume rebates reduce revenue (generated sales) in the year to which they pertain to.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Payables to employees–gross salaries, other receipts and charges | 92,318 | 88,803 |
| Derivatives | 0 | 2,653 |
| Other | 13,866 | 13,504 |
| Total other current liabilities | 106,184 | 104,960 |
The item ‘Other’ also includes current liabilities to the State on account of VAT payable in the amount of €6,068 thousand (2023: €6,657 thousand) and other current liabilities to the State totalling €4,759 thousand (2023: €4,786 thousand).
The Krka Group has no contingent liabilities. At the end of 2024, Krka’s commitments for acquiring property, plant, and equipment, based on signed contracts related to ongoing investments, totalled €77,406 thousand (2023: €76,482 thousand).
The Krka Group concludes lease agreements for various assets such as parking spaces, offices, warehouses, land, apartments, cars, and equipment. The lease terms are assessed according to the type of lease:
The Krka Group does not sub-lease the leased assets. The Krka Group concluded lease contracts for various production and non-production equipment, temporary offices, and parking spaces, with lease terms shorter than one year. With respect to those leases, the Krka Group applied a practical expedient provided by the Standard.
| € thousand | Carrying amounts of lease liabilities under interest-bearing loans and borrowings and movements during the period |
|---|---|
| Balance at 1 Jan 2023 | 11,841 |
| Increase/Decrease | 4,106 |
| Interest | 314 |
| Lease payments | –4,184 |
| Translation reserve | –78 |
| Balance at 31 Dec 2023 | 11,999 |
| –Current lease liabilities | 3,452 |
| –Non-current lease liabilities | 8,547 |
| Balance at 1 Jan 2024 | 11,999 |
| Increase/Decrease | 5,043 |
| Interest | 481 |
| Lease payments | –4,188 |
| Translation reserve | –184 |
| Balance at 31 Dec 2024 | 13,151 |
| –Current lease liabilities | 3,649 |
| –Non-current lease liabilities | 9,502 |
| € thousand | 2024 | 2023 |
|---|---|---|
| Depreciation of right-of-use assets | 3,869 | 3,797 |
| Interest expenses on lease liabilities | 481 | 314 |
| Expenses relating to current leases | 1,205 | 1,310 |
| € thousand | Balance at 31 Dec 2023 | Monetary changes | Non-monetary changes | Balance at 31 Dec 2024 | Additions/ disposals | Other | Dividends |
|---|---|---|---|---|---|---|---|
| Financial liabilities | 1,302 | –230,884 | 230,933 | 0 | 1,351 | ||
| Leases | 11,999 | –4,188 | 4,859 | 481 | 13,151 | ||
| Total | 13,301 | –235,072 | 235,792 | 481 | 14,502 |
| € thousand | Balance at 31 Dec 2022 | Monetary changes | Non-monetary changes | Balance at 31 Dec 2023 | Additions/ disposals | Other | Dividends |
|---|---|---|---|---|---|---|---|
| Financial liabilities | 1,303 | –204,379 | 204,378 | 0 | 1,302 | ||
| Leases | 11,841 | –4,184 | 4,028 | 314 | 11,999 | ||
| Total | 13,144 | –208,563 | 208,406 | 314 | 13,301 |
The key credit risk of the Krka Group arises from trade receivables. This is the risk of customers failing to settle their liabilities by maturity dates.
The Krka Group introduced a centralised credit control process in 2004. The system includes all customers with credit limits exceeding €20,000. Numbering over 600 such customers at the end of 2024, they accounted for more than 95% of total trade receivables. Receivables due from small customers accounted for less than 5% of total trade receivables. Control over small customers is decentralised in the sales network and under the constant supervision of the controlling company.
Credit control is a two-step process. The first step involves assessing the credit risk for each customer, determining hedging instruments, and assigning relevant credit limits. We assess each new customer and review the credit ratings of all customers twice a year. Each credit rating includes many different financial and non-financial indicators, which fall into four categories (assessment of the profitability, payment habits and payment discipline of the customer, assessment of the customer's financial statements, qualitative assessment of sales staff and country risk assessment), each of which carries a different weight in the final assessment.
Each customer is allocated a customised credit limit based on their credit rating, anticipated shipment, and payment patterns.
The second step in the credit-control process involves regular dynamic monitoring of a customer's payment discipline. The information systems of all Group subsidiaries engaged in sales monitor available limits and overdue receivables. Control is exercised for each shipment of Krka products to customers. A shipment is automatically blocked if a customer is in arrears or if receivables together with the new shipment exceed the approved credit limit. Sales personnel are required to initiate a payment collection procedure or arrange hedging for the outstanding settlements.
The credit control process employs uniform rules which apply to all customers. Due to the specifics of sales markets, additional national controls have been introduced in individual subsidiaries. Credit control processes are regularly adjusted to changes in the sales markets.
Credit control guarantees permanent control over the quality of the trade receivables portfolio. The result is a low share of receivable write-offs and impairments in view of Krka Group sales.
The amount of receivable write-offs and impairments remains low due to the broad distribution of receivables across many customers and sales markets. Additionally, the majority of outstanding receivables are from long-standing customers with whom Krka has been doing business for several years.
In 2024, we continued activities to manage trade receivables, with a particular focus on the management of receivables in challenging markets. The credit risk management result in 2024 was favourable. At the end of the year, the value of trade receivables was 9% higher than at the beginning of the year, while the amount of overdue and unpaid receivables remained within a range acceptable to Krka.
The impact of net impairments and write-offs of receivables on the Krka Group's final result in 2024 amounted to less than 0.12% of sales.
The carrying amount of financial assets represents the largest exposure to credit risk as illustrated below:
| € thousand | Notes | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|---|
| Loans | 13 | 45,836 | 128,817 |
| Investments at fair value through profit or loss | 14 | 224,110 | 236,751 |
| Investments at amortised cost (debt instruments) | 14 | 20,231 | 90,791 |
| Trade receivables | 17 | 552,710 | 509,070 |
| Cash and cash equivalents | 18 | 344,895 | 174,011 |
| Total | 1,187,782 | 1,139,440 |
As for the financial assets exposed to credit risk, the loans, investments, trade receivables, and cash and cash equivalents are presented separately.
The loans comprise a loan of €22,766 thousand for production facilities in China and housing loans for Krka employees representing a limited credit risk for the Krka Group.
Investments at fair value through profit or loss represent investments in treasury bills issued by Western European EU Member States and EU-issued treasury bills with a high credit rating (P-1 by Moody's).
Investments at amortised cost (debt instruments) represent an investment in a bond of an EU Member State with less than half a year to maturity at 31 December 2024. It is classified as a low credit risk financial instrument because its credit risk rating is equivalent to the globally understood definition of investment grade with a rating of A3 by Moody's and A– by S&P Global Ratings.
The Company's cash and cash equivalents consist of bank balances and deposits with a maturity of less than 90 days, held at EU banks with a high credit rating (P-1 by Moody's).
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Region Slovenia | 14,069 | 43,854 |
| Region South-East Europe | 72 | 85 |
| Region East Europe | 246 | 137 |
| Region Central Europe | 257 | 175 |
| Region West Europe | 514 | 50,197 |
| Region Overseas Markets | 30,678 | 34,369 |
| Total | 45,836 | 128,817 |
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Region Slovenia | ||
| Region South-East Europe | ||
| Region East Europe | ||
| Region Central Europe | ||
| Region West Europe | ||
| Region Overseas Markets | ||
| Total |
| Region | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Slovenia | 13,494 | 12,615 |
| South-East Europe | 103,948 | 97,211 |
| East Europe | 246,410 | 212,160 |
| Central Europe | 93,049 | 86,279 |
| West Europe | 88,122 | 95,266 |
| Overseas Markets | 7,687 | 5,539 |
| Total | 552,710 | 509,070 |
As at 31 December 2024, €3,889 thousand of receivables were outstanding from Ukrainian customers (2023: €3,037 thousand).
The value of receivables from Russian customers as at 31 December 2024 amounted to €205,857 thousand (2023: €184,029 thousand).
| € thousand | Gross value at 31 Dec 2024 | Allowance at 31 Dec 2024 | Gross value at 31 Dec 2023 | Allowance at 31 Dec 2023 |
|---|---|---|---|---|
| Not past due | 45,830 | 0 | 128,810 | 0 |
| Past due up to 20 days | 0 | 0 | 0 | 0 |
| Past due from 21 to 50 days | 0 | 0 | 2 | 0 |
| Past due from 51 to 180 days | 1 | 0 | 1 | 0 |
| Past due more than 180 days | 5 | 0 | 4 | 0 |
| Total | 45,836 | 0 | 128,817 | 0 |
| € thousand | Gross value at 31 Dec 2024 | Allowance at 31 Dec 2024 | Net value at 31 Dec 2024 | Gross value at 31 Dec 2023 | Allowance at 31 Dec 2023 | Net value at 31 Dec 2023 |
|---|---|---|---|---|---|---|
| Not past due | 536,672 | 648 | 536,024 | 481,775 | 861 | 480,914 |
| Past due up to 20 days | 13,593 | 96 | 13,497 | 21,574 |
| 1,518 | 57 | 1,461 | 4,050 | 105 | 3,945 |
|---|---|---|---|---|---|
| 562 | 58 | 504 | 1,501 | 118 | 1,383 |
|---|---|---|---|---|---|
| 32,547 | 31,323 | 1,224 | 35,807 | 34,415 | 1,392 |
|---|---|---|---|---|---|
| 584,892 | 32,182 | 552,710 | 544,707 | 35,637 | 509,070 |
|---|---|---|---|---|---|
The Krka Group is extending payment deadlines to some customers. If the payment terms were not extended, the receivable maturity structure would be as follows at the reporting date: not past due €450,472 thousand (2023: €438,038 thousand); past due up to 20 days €58,591 thousand (2023: €44,372 thousand); past due between 21 and 50 days €21,473 thousand (2023: €21,549 thousand); past due between 51 and 180 days €20,007 thousand (2023: €3,071 thousand); and past due more than 180 days €1,226 thousand (2023: €1,391 thousand).
| € thousand | Gross value at 31 Dec 2024 | Allowance at 31 Dec 2024 | Net value at 31 Dec 2024 | Gross value at 31 Dec 2023 | Allowance at 31 Dec 2023 | Net value at 31 Dec 2023 |
|---|---|---|---|---|---|---|
| Not past due | 206,131 | 274 | 205,857 | 184,390 | 370 | 184,020 |
| Past due up to 20 days | 0 | 0 | 0 | 9 | 0 | 9 |
| Total | 206,131 | 274 | 205,857 | 184,399 | 370 | 184,029 |
The share of secured receivables in the Russian Federation was more than 95% (2023: more than 90%).
| € thousand | 2024 | 2023 |
|---|---|---|
| Balance at 1 Jan | 35,637 | 38,559 |
| Formation of allowance | 369 | 879 |
| Write-off of receivables | –1,274 | –528 |
| Impairment reversal | –2,495 | –4,140 |
| –12 | –496 |
|---|---|
| –43 | –72 |
|---|---|
| 0 | 1,435 |
|---|---|
| 32,182 | 35,637 |
|---|---|
Business partners value Krka for its excellent financial discipline and stable cash flows. We settled all financial liabilities regularly in 2024 as well. The Krka Group’s exposure to liquidity risk was low.
The Krka Group has agreements with two banks for the allowed negative balance on transaction accounts for a total amount of €11,125 thousand (in 2023, the Krka Group had agreements with two banks for a total amount of €10,050 thousand). There were no negative balances on transaction accounts at 31 December 2024, so the bank overdraft remained fully unused.
As at 31 December 2024, the Krka Group had an undrawn credit facility of €20,000 thousand (2023: €20,000 thousand). At the end of 2024, the Krka Group recorded cash and cash equivalents primarily as cash at bank or short-term deposits with maturity of up to 90 days held at first-class commercial banks. Other current liquid assets were held in short-term treasury bills issued by Western European countries with first-class credit ratings.
In 2024, the world’s major central banks began lowering key interest rates. The Krka Group recorded favourable returns on cash, cash equivalents, and low-risk liquid investments, reflected in higher interest income and income from other financial instruments.
The Krka Group oversees liquid assets in line with internal investment diversification rules, taking into account factors such as interest rate, liquidity, credit, and currency risks.
The controlling company manages liquidity risk centrally for the entire Krka Group. The controlling company finances subsidiaries through intra-group loans. Any potential excess cash is deposited with the controlling company. Excess cash from all Krka Group companies is transferred to the controlling company’s master account either automatically daily (cash pooling) or manually through individual bank transfers. This allows for cash management optimisation, currency risk mitigation, an overview of the liquidity of all Krka Group companies, and enhanced security of money transactions.
The Krka Group also reported favourable and stable liquidity ratios at the end of 2024.
Liabilities in terms of maturity are outlined in the tables below.
| €thousand | Carrying amount | Contractual cash flows | Total | Up to 6 months | 6–12 months | 1–2 years | 2–5 years | 5–10 years |
|---|---|---|---|---|---|---|---|---|
| Lease liabilities | 13,151 | 14,646 | 2,172 | 2,019 | 3,383 | 5,858 | 1,214 | |
| Trade payables excluding advances | 148,285 | 148,285 | 148,285 | 0 | 0 | 0 | ||
| Contract liabilities excluding advances | 159,148 | 159,148 | 159,148 | 0 | 0 | 0 | ||
| Other liabilities excluding amounts owed to the State, to employees and advances | 6,056 | 6,056 | 6,056 | 0 | 0 | 0 | ||
| Total liabilities | 326,640 | 328,135 | 315,661 | 2,019 |
| € thousand | Carrying amount | Contractual cash flows | Total | Up to 6 months | 6–12 months | 1–2 years | 2–5 years | 5–10 years |
|---|---|---|---|---|---|---|---|---|
| Lease liabilities | 11,999 | 13,550 | 2,041 | 1,907 | 3,144 | 5,610 | 848 | |
| Trade payables excluding advances | 153,762 | 153,762 | 153,762 | 0 | 0 | 0 | 0 | |
| Contract liabilities excluding advances | 152,347 | 152,347 | 152,347 | 0 | 0 | 0 | 0 | |
| Other liabilities excluding amounts owed to the State, to employees and advances | 5,160 | 5,160 | 5,160 | 0 | 0 | 0 | 0 | |
| Derivatives | 2,653 | 2,653 | 2,653 | 0 | 0 | 0 | 0 | |
| Total liabilities | 325,921 | 327,472 | 315,963 | 1,907 | 3,144 | 5,610 | 848 |
The Krka Group operates in diverse international environments and is exposed to foreign exchange risk in certain sales and purchase markets.
Currency exposure arises from the difference in the value of assets and liabilities in a particular currency in the financial position statement of the Krka Group and from differences between operating income and expenses generated in individual currencies.
The key accounting categories composing a currency position are trade receivables, trade payables, liquid financial assets in foreign currencies, derivatives for currency risk hedging, financing of subsidiaries ensured by the controlling company and recorded purchase orders.
At the end of 2024, the Russian rouble held the largest share of Krka's currency position at 45%. The position in roubles has increased over the beginning of 2024, which is attributable to receivables from customers on the Russian market and partly from financing provided by the controlling company to subsidiaries in the Russian Federation.
The importance of the Russian market, the level of currency exposure, and the volatility of the Russian rouble are why we pay special attention to Russian rouble risk management. With reduced availability of financial instruments, we continued to prioritise natural risk mitigation methods in 2024.
Unlike with other currencies, exposure to the US dollar arises from a surplus of liabilities over assets from regular business operations, or in other words, the currency position is short. Exposure to the US dollar arises primarily from purchasing raw and other materials. Considering liquid financial assets in US dollars and dollar forward contracts that together offset the short financial position from operations, the 2024 year-end exposure to the US dollar accounted for 8% of total Krka Group currency exposure.
Other currencies, among them the Swedish krona, North Macedonian denar, Kazakh tenge, Serbian dinar, British pound, Czech koruna, Ukrainian hryvnia, and Hungarian forint, together accounted for 20% of the Krka Group currency position. The value of the rouble in euro terms has fallen by 15.3% from the beginning to the end of 2024 and was, on average, 7.9% lower than in 2023.
The value of the US dollar denominated in euro increased by 6.4% from the beginning to the end of 2024, while the average value was about the same as in the previous year. The impact of the change in the value of the US dollar on Krka's Group's result was neutralised by the use of financial instruments.
The military conflict and the uncertainty about the future economic landscape in Ukraine continued to affect the movement of the Ukrainian hryvnia in 2024. The value of the Polish zloty was fairly stable in 2024, with the EUR/PLN exchange rate fluctuating between 4.25 and 4.35. From the beginning to the end of 2024, the Polish zloty appreciated by 1.5%, while the average value was 5.5% higher than in 2023.
The Romanian leu and the Czech koruna were also very stable in 2024. The Hungarian forint has depreciated, mainly due to uncertainty about economic growth.
The Krka Group generally mitigates currency risks by natural hedging, primarily by increasing purchases and liabilities in currencies in which sales invoices are issued. When this is impossible, we use derivatives or do not hedge the risk. Generally, only forward contracts are used for hedging.
In 2024, we also hedged against the US dollar risk with financial instruments. The Russian rouble risk was hedged solely by natural methods, as there were no suitable financial instruments on the banking market. The rouble's depreciation against the euro resulted in negative net exchange rate differences.
The increasing exposure from operations and the interest rate differential between the euro and the US dollar, which is favourable for Krka, are the key reasons to hedge the US dollar exposure with financial instruments also in 2024. The impact of the instruments used to hedge the short US dollar position on Krka's net financial result was positive due to the appreciation of the US dollar against the euro.
| € thousand | 31 Dec 2024 | EUR* | RUB | PLN | USD | RON |
|---|---|---|---|---|---|---|
| Loans | 14,709 | 50 | 243 | 21 | 10 | |
| Trade receivables | 136,779 | 217,755 | 61,023 | 18,025 | 59,066 | |
| Cash and cash equivalents | 290,036 | 5,833 | 2,900 | 19,253 | 2,053 | |
| Current trade payables | –127,846 | –2,635 | –2,207 | –8,030 | –572 | |
| Financial position exposure (net) | 313,677 | 221,002 | 61,959 | 29,270 | 60,558 |
| € thousand | 31 Dec 2023 | EUR* | RUB | PLN | USD | RON |
|---|---|---|---|---|---|---|
| Loans | 94,116 | 51 | 169 | 0 | 22 | |
| Trade receivables | 135,047 | 198,075 | 59,091 | 11,100 | 52,899 | |
| Cash and cash equivalents | 134,641 | 7,573 | 775 | 5,447 | 2,838 | |
| Current trade payables | –127,456 | –150 | –45 | –11,987 |
236,348
205,549
59,991
4,560
55,276
| Average exchange rate* | Final exchange rate* | |||
|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | |
| RUB | 100.44 | 92.49 | 118.01 | 99.97 |
| PLN | 4.31 | 4.54 | 4.28 | 4.34 |
| USD | 1.08 | 1.08 | 1.04 | 1.11 |
| RON | 4.97 | 4.95 | 4.97 | 4.98 |
The above-stated exchange rates were used to calculate items in the financial statements as at 31 December and equal the reference exchange rates of the ECB effective on the last day of the year. Since the end of March 2022, the Bloomberg exchange rate is used to convert the Russian rouble.
A 1% change in the value of these currencies against the euro as at 31 December 2024 or 31 December 2023 would increase or decrease the profit by the amounts stated below. The analysis, prepared in the same manner for both years, assumes that all other remaining variables except for the exchange rate, in particular interest rates, remain unchanged. The calculation of the above-stated exchange rate volatility impact took into account the balance of receivables, liabilities, loans and cash and cash equivalents denominated in the local currencies.
| € thousand | Impact on profit or loss before tax | |||
|---|---|---|---|---|
| 2024 | 2023 | |||
| Currency fluctuations for | +1% | –1% | +1% | –1% |
| RUB | 2,210 | –2,210 | 2,055 | –2,055 |
| PLN | 620 | –620 | 600 | –600 |
| USD | 293 | –293 | 46 | –46 |
| RON | 606 | –606 | 553 | –553 |
Any additional 1% increase/decrease in the euro exchange rate relative to the aforementioned currencies would result in a corresponding increase or decrease in the profit or loss before tax by the amounts stated above.
Interest rate risk is the risk of losses that result from a change in interest rates and is related to Krka’s non-current borrowings and investments. The interest rate risk with current borrowings and current investments is managed as part of the Krka Group’s liquidity risk. The Krka Group had no non-current borrowings in 2024.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Financial instruments at a fixed rate of interest | 249,760 | 215,069 |
| Financial assets |
As the Krka Group did not have any variable interest rate financial instruments at 31 December 2024, a change of 100 basis points in the 2024 variable interest rate would not change the profit or loss for 2024. An increase of 100 basis points in the variable interest rate would increase the 2023 profit by €300 thousand (a decrease of the interest rate by 100 basis points would decrease the profit or loss by €300 thousand). The analysis, conducted consistently for both years, assumes that all variables, especially the exchange rate, remain unchanged.
The primary objective of managing the Krka Group's capital is to ensure a high credit rating and adequate funding ratios so that the Krka Group can adequately develop its business and maximise value for its shareholders. By managing and adjusting its capital structure, the Krka Group aims to keep pace with changes in the economic environment. Dividends are paid once a year in line with the strategic dividend growth policy. The Krka Group has no specific employee ownership targets or share option plan. The Krka Group’s approach to capital management did not change in 2024 or 2023.
The Krka Group monitors capital using a gearing ratio, calculated as net debt divided by the sum of net debt and total equity. Within net debt, Krka includes interest-bearing borrowings, operating liabilities, current liabilities from contracts with customers and other current payables less cash and cash equivalents.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Operating liabilities | 148,285 | 153,762 |
| Current liabilities from contracts with customers | 166,078 | 162,173 |
| Other current payables | 106,184 | 104,960 |
| Cash and cash equivalents | 344,895 | 174,011 |
| Net indebtedness | 75,652 | 246,884 |
| Equity | 2,237,784 | 2,181,766 |
| Equity and net indebtedness | 2,313,436 | 2,428,650 |
| Financial leverage (debt/equity) ratio | 3.3% | 10.2% |
The following table shows the carrying amounts and fair values of financial assets and financial liabilities. The table does not include disclosures about the fair values of financial assets and liabilities not measured at fair value, where the carrying amount is a reasonable approximation of fair value.
| € thousand | 31 Dec 2024 | Fair value | 31 Dec 2023 | Fair value |
|---|---|---|---|---|
| Non-current financial assets | Loans | 35,330 | 70,098 | |
| Investments at fair value through OCI (equity instruments) | 22,024 | 22,024 | 26,901 | 26,901 |
| Investments at amortised cost (debt instruments) | 0 | 20,773 | ||
| Current financial assets | Loans | 10,506 | 58,719 | |
| Investments at fair value through profit or loss | 224,110 | 224,110 | 236,751 |
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Investments at amortised cost | 236,751 | 20,231 |
| Derivatives | 5,453 | 5,453 |
| Trade receivables | 552,710 | 509,070 |
| Cash and cash equivalents | 344,895 | 174,011 |
| Non-current financial liabilities | Lease liabilities | –9,502 |
| Current financial liabilities | Derivatives | 0 |
| –2,653 | –2,653 | |
| Lease liabilities | –3,649 | –3,452 |
| Trade payables excluding advances | –148,285 | –153,762 |
| Contract liabilities excluding advances | –159,148 | –152,347 |
| Other liabilities excluding amounts owed to the State, to employees and advances | –6,056 | –5,160 |
| Total | 888,619 | 251,587 |
| 840,420 | 260,999 |
In terms of fair value, assets and liabilities are classified into three levels:
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Level 1 | 20,637 | 25,514 |
| Level 2 | 0 | 0 |
| Level 3 | 1,387 | 1,387 |
| Total | 22,024 | 26,901 |
| Investments at fair value through profit or loss | 224,110 | 236,751 |
| Derivatives | 0 | 0 |
| Total assets at fair value | 244,747 |
Data on groups of persons
By the end of 2024, members of the Management Board of the Company held 37,040 Krka shares, i.e. 0.1129% of total equity and 0.1207% of voting rights. Members of the Supervisory Board of the controlling company held 2,547 shares i.e. 0.0078% of total equity and 0.0083% of voting rights. Directors of subsidiaries held 6,069 shares or 0.0185% of the total equity and 0.0198% of voting rights.
| No. of shares | Equity share (%) | Share in voting rights (%) | No. of shares | Equity share (%) | Share in voting rights (%) | |
|---|---|---|---|---|---|---|
| Members of the Management Board | ||||||
| Jože Colarič | 22,500 | 0.0686 | 0.0733 | 22,500 | 0.0686 | 0.0729 |
| Aleš Rotar | 13,915 | 0.0424 | 0.0453 | 13,915 | 0.0424 | 0.0451 |
| Vinko Zupančič | 120 | 0.0004 | 0.0004 | 120 | 0.0004 | 0.0004 |
| David Bratož | 0 | / | / | 0 | / | / |
| Milena Kastelic | 505 | 0.0015 | 0.0016 | 505 | 0.0015 | 0.0016 |
| Total Members of the Management Board | 37,040 | 0.1129 | 0.1207 | 37,040 | 0.1129 | 0.1200 |
| Members of the Supervisory Board, owner representatives | ||||||
| Jože Mermal | 0 | / | / | 0 | / | / |
| Luka Cerar* | 0 | / | / | 0 | / | / |
| Name | 31 Dec 2024 | 31 Dec 2023 | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|---|---|
| Borut Jamnik | 0 | / | / | 0 |
| Matej Lahovnik | 1,000 | 0.0030 | 0.0033 | 1,000 |
| Julijana Kristl | 230 | 0.0007 | 0.0007 | 230 |
| Mojca Osolnik Videmšek | 617 | 0.0019 | 0.0020 | 617 |
| Boris Žnidarič | 0 | / | / | 0 |
| Mari Božič | 0 | / | / | 0 |
| Franc Šašek | 200 | 0.0006 | 0.0007 | 500 |
| Tomaž Sever | 500 | 0.0015 | 0.0016 | 500 |
| Mateja Vrečer | 0 | / | / | 0 |
| Total | 31 Dec 2024 | 31 Dec 2023 | 31 Dec 2024 | 31 Dec 2023 | |
|---|---|---|---|---|---|
| 2,547 | 0.0078 | 0.0083 | 2,847 |
| 39,587 | 0.1207 | 0.1290 | 39,887 |
|---|---|---|---|
*Supervisory Board member since 7 July 2023
**Supervisory Board member until 6 July 2023
***Supervisory Board member since 21 June 2024
****Supervisory Board member until 20 June 2024
Treasury shares were eliminated from the calculation of voting rights (2,107,337 treasury shares as at 31 December 2024 and 1,915,966 as at 31 December 2023).
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Members of the Management Board in the controlling company | 4,832 | 4,317 |
2,618
2,722
381
311
1
1
7,832
7,351
Included wages and salaries, fringe benefits and any other earnings. For each year, they are shown on a cost basis and therefore differ from the remuneration detailed in the Report on Remuneration of the Members of the Management Board and Supervisory Board of the Company for 2024, where they are shown by payments in each year.
Remuneration paid to members of the Supervisory Board in the controlling company represents earnings in connection with exercising the function within the Supervisory Board. Remuneration paid to Supervisory and Management Boards members in subsidiaries who simultaneously sit on the Management Board in the controlling company or are employed under individual employment contracts includes only earnings related to their roles within the Supervisory and Management Boards.
Gross earnings paid to persons employed under individual employment contracts in 2024 amounted to €15,732 thousand (2023: €14,533 thousand).
| € thousand | Fixed remuneration | Variable remuneration | Total | Gross | Net payout | Net fringe benefits and other earnings |
|---|---|---|---|---|---|---|
| Jože Colarič | 582 | 194 | 55 | 996 | 387 | 1,578 |
| Aleš Rotar | 456 | 156 | 45 | 644 | 250 | 1,100 |
| Vinko Zupančič | 384 | 134 | 40 | 536 | 209 | 920 |
| David Bratož | 379 | 131 | 40 | 527 | 205 | 906 |
| Milena Kastelic | 229 | 84 | 25 | 99 | 39 | 328 |
| Total remuneration paid to Members of the Management Board | 2,030 | 699 | 205 | 2,802 | 1,090 | 4,832 |
| Anniversary Bonuses | Other Bonuses | Refund of Work-related Funds | Pay for Annual Leave | Total | |||
|---|---|---|---|---|---|---|---|
| Jože Colarič | 45.31 | 2.92 | 0.00 | 4.31 | 0.05 | 2.32 | 54.90 |
| Aleš Rotar | 35.95 | 2.92 | 0.00 | 2.42 | 1.12 | 2.32 | 44.72 |
| Vinko Zupančič | 30.39 | 2.92 | 0.00 | 3.42 | 0.96 | 2.32 | 40.00 |
| David Bratož | 29.81 | 2.92 | 0.00 | 4.23 | 1.20 | 2.32 | 40.46 |
| Milena Kastelic | 18.59 | 2.92 | 0.00 | 0.06 | 1.20 | 2.32 | 25.08 |
| Total remuneration paid to Members of the Management Board | 160.04 | 14.58 | 0.00 | 14.44 | 4.51 | 11.59 | 205.16 |
| € thousand | Fixed remuneration | Variable remuneration | Total | Gross | Net payout | Net fringe benefits and other earnings | Gross | Net |
|---|---|---|---|---|---|---|---|---|
| Jože Colarič | 526 | 191 | 33 | 858 | 335 | 1,384 | 559 | |
| Aleš Rotar |
| Vinko Zupančič | 415 | 154 | 29 | 575 | 224 | 990 | 407 |
|---|---|---|---|---|---|---|---|
| David Bratož | 349 | 131 | 26 | 479 | 187 | 828 | 344 |
| Milena Kastelic | 342 | 129 | 26 | 470 | 184 | 812 | 339 |
| € thousand | Net fringe benefits and other earnings | Liability insurance, supplementary pension insurance | Supplementary pension insurance | Anniversary bonuses | Other bonuses | Refund of work-related funds | Pay for annual leave | Total |
|---|---|---|---|---|---|---|---|---|
| Jože Colarič | 27.15 | 2.90 | 0.00 | 1.10 | 0.06 | 2.15 | 33.36 | |
| Aleš Rotar | 19.27 | 2.90 | 0.00 | 3.12 | 1.10 | 2.15 | 28.54 | |
| Vinko Zupančič | 16.07 | 2.90 | 0.00 | 4.45 | 0.89 | 2.15 | 26.46 | |
| David Bratož | 16.96 | 2.90 | 0.00 |
Milena Kastelic
Members of the Management Board do not receive attendance fees or any other income for exercising their functions in the Management and Supervisory Boards in subsidiaries.
| € thousand | Basic pay for exercising the function | Fringe benefits and other earnings* | Attendance fees | Commuting allowances | Total | |||||
|---|---|---|---|---|---|---|---|---|---|---|
| Gross | Net | Gross | Gross | Net | Gross | Net | Gross | Net | Gross | Net |
| Members of the Supervisory Board, owner representatives | Jože Mermal | 40.25 | 29.19 | 0.99 | 2.52 | 1.84 | 0.00 | 0.00 | 43.76 | 31.03 |
| Luka Cerar | 32.14 | 23.19 | 1.20 | 3.96 | 2.90 | 0.47 | 0.35 | 37.77 | 26.44 | |
| Matej Lahovnik | 37.10 | 26.88 | 0.99 | 4.25 | 3.11 | 1.00 | 0.73 | 43.34 | 30.72 | |
| Julijana Kristl | 35.00 | 25.33 | 1.38 | 3.38 | 2.48 | 0.47 | 0.34 | 40.23 | 28.15 | |
| Mojca Osolnik Videmšek | 36.53 | 26.46 | 0.99 | 4.25 |
| 0.51 | 0.37 | 42.28 | 29.94 | Boris Žnidarič | 40.25 | 29.17 | 1.38 | 5.11 | 3.74 | 0.51 | 0.37 | 47.25 | 33.28 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Members of the Supervisory Board, employee representatives | Mari Božič** | 15.46 | 11.32 | 0.00 | 1.08 | 0.79 | 0.00 | 0.00 | 16.54 | 12.11 | |||
| Franc Šašek*** | 17.03 | 12.19 | 0.99 | 2.59 | 1.89 | 0.00 | 0.00 | 20.61 | 14.08 | ||||
| Tomaž Sever | 37.40 | 27.10 | 0.99 | 3.96 | 2.90 | 0.59 | 0.43 | 42.94 | 30.43 | ||||
| Mateja Vrečer | 40.89 | 29.65 | 0.99 | 4.82 | 3.53 | 0.00 | 0.00 | 46.70 | 33.18 | ||||
| Total remuneration paid to Members of the Supervisory Board | 332.05 | 240.48 | 9.90 | 35.92 | 26.29 | 3.55 | 2.59 | 381.42 | 269.36 |
*Fringe benefits and other earnings include collective liability insurance and, for individual members, also the membership fee for Slovenian Directors' Association (SDA).
**Supervisory Board member since 21 June 2024
***Supervisory Board member until 20 June 2024
As at 31 December 2024, the members of the controlling company's Management Board, managers of subsidiaries, members of the controlling company's Supervisory Board and members of Supervisory Boards and Boards of Directors of subsidiaries did not receive any loans from the Krka Group (as at 31 December 2023, the managers of the subsidiaries recorded a loan in the amount of €10 thousand).
Loans to staff employed under individual employment contracts amounted to €187 thousand at 31 December 2024 (2023: €143 thousand). In the reporting period, repayments of loans by staff employed under individual employment contracts reached €33 thousand (2023: €58 thousand).
Ownership share
| Controlling company | Local currency | Value of share capital at 31 Dec 2024 (€thousand) | Headcount at 31 Dec 2024 | Headcount at 31 Dec 2023 |
|---|---|---|---|---|
| KRKA, d. d., Novo mesto | EUR | 54,732 | 7,523 | 6,509 |
| TERME KRKA, d. o. o., Novo mesto, Slovenia* | EUR | 14,753 | 645 | 626 |
| KRKA-FARMA d.o.o., Zagreb, Croatia | EUR | 18,983 | 217 | 210 |
| KRKA ROMANIA S.R.L., Bucharest, Romania | RON | 7 | 168 | 159 |
| KRKA-FARMA DOO BEOGRAD, Belgrade, Serbia | RSD | 1 | 96 | 99 |
| KRKA-FARMA DOOEL Skopje, Skopje, North Macedonia | MKD | 796 | 47 | 46 |
| KRKA Bulgaria EOOD, Sofia, Bulgaria | BGN | 10 | 78 | 75 |
| KRKA HELLAS E.P.E., Athens, Greece | EUR | 10 | 17 | 15 |
| KRKA FARMA, d.o.o. Sarajevo, Sarajevo, Bosnia and Herzegovina | BAM | 10 | 1 | 1 |
| Krka-Rus LLC, Istra, Russian Federation | RUB | 45,432 | 537 | 558 |
| KRKA FARMA LLC, Istra, Russian Federation | 753,875 |
| RUB | 6,388 | 1,333 | 1,301 | |
|---|---|---|---|---|
| KRKA UKRAINE LLC, Kiev, Ukraine | 100% | 100 | UAH | |
| 2 | 385 | 382 | LLC ´KRKA Kazakhstan´, Almaty, Kazakhstan | 100% |
| 14 | USD | 13 | 104 | 102 |
| KRKA - POLSKA Sp. z.o.o., Warsaw, Poland | 100% | 17,490 | PLN | |
| 4,091 | 656 | 659 | KRKA ČR, s. r. o., Prague, Czechia | 100% |
| 100 | CZK | 4 | 139 | 158 |
| KRKA Magyarország Kft., Budapest, Hungary | 100% | 44,880 | HUF | |
| 109 | 159 | 160 | KRKA Slovensko, s.r.o., Bratislava, Slovakia | 100% |
| 10 | EUR | 10 | 112 | 116 |
| UAB KRKA Lietuva, Vilnius, Lithuania | 100% | 10 | EUR | |
| 10 | 48 | 55 | SIA KRKA Latvija, Riga, Latvia | 100% |
| 10 | EUR | 10 | 36 | 38 |
| TAD Pharma GmbH, Cuxhaven, Germany | 100% | 6,650 | EUR | |
| 6,650 | 210 | 200 | KRKA Sverige AB, Stockholm, Sweden | 100% |
| 150 | SEK | 13 | 6 | 7 |
| KRKA Pharma GmbH, Wien, Vienna, Austria | 100% | 37 | EUR | |
| 37 | 18 | 21 | KRKA Farmacêutica, Unipessoal Lda., Estoril, Portugal | 100% |
| 10 | EUR | 10 | 52 | 53 |
| KRKA FARMACÉUTICA, S.L., Madrid, Spain | 100% | 10 | EUR |
| KRKA Farmaceutici Milano s.r.l, Milan, Italy | 100% | 10 | EUR |
|---|---|---|---|
| Krka France Eurl, Paris, France | 100% | 10 | EUR |
| KRKA PHARMA DUBLIN LIMITED, Dublin, Ireland | 100% | 1 | EUR |
| KRKA Belgium, SA, Brussels, Belgium | 100% | 300 | EUR |
| KRKA Finland Oy, Espoo, Finland | 100% | 3 | EUR |
| KRKA UK LTD, London, United Kingdom | 100% | 1 | GBP |
| 123 Acurae Pharma GmbH, Cuxhaven, Germany | 100% | 25 | EUR |
| KRKA Netherlands B.V., Breskens, Netherlands | 100% | 10 | EUR |
| Ningbo Krka Menovo Pharmaceutical Co. Ltd, Ningbo, China | 60% | 480,673 | CNY |
| KRKA USA LLC, Wilmington, USA | 100% | 10 | USD |
| KRKA GCC L.L.C., Dubai, United Arab Emirates | 100% | 37 | AED |
| Total | 12,810 |
Notetor ESRS 2 SBM-1 –Strategy, business model and valuechain
As at 31 December 2024, the subsidiary Terme Krka, d.o.o. had a 100-percent shareholding in Golf Grad Otočec, d.o.o. and the subsidiary KRKA France Eurl had a 100-percent shareholding in HCS bvbain Belgium. The Chinese company Ningbo Menovo Pharmaceutical Co. Ltd is the 40-percent owner of the company Ningbo Krka Menovo Pharmaceutical Co. Ltd.
In April 2024, the Company and Laurus Labs Ltd. from India established the company KRKA Pharma Private Limited, in Hyderabad, India, which they jointly control under a contractual agreement. The co-founders plan to pay the share capital in phases, with the first payment being made in October 2024. The Company's ownership interest in the joint venture KRKA Pharma Private Limited is 51%. The Krka Group accounts for its investment in the joint venture using the equity method.
The Krka Group’s operations in Ukraine and the Russian Federation are running smoothly, with business activities conducted through three subsidiaries and the controlling company Krka, d. d., Novo mesto. Ukraine became our third largest market in 2024 (Note 4 – Revenue from contracts with customers). We achieved a 15% increase in product sales by value compared to 2023 when Ukraine ranked as Krka's fourth-largest market by sales. Krka's subsidiary in Ukraine is engaged solely in marketing, not sales and production and therefore had no receivables from customers outside the Krka Group. It had, however, other assets of €1,983 thousand (2023: €1,383 thousand) among which property, plant and equipment (business premises and passenger cars) represent the largest group. The Krka Group is not materially exposed to credit risk (Note 29 – Credit risk) or exchange rate risk (Note 29 – Foreign exchange risk) as sales are conducted in euro.
The Russian Federation was Krka's largest individual market in 2024 and 2023 (Note 4 – Revenue from contracts with customers). In 2024, we sold 8% more products in euro in terms of value than in 2023, while sales denominated in rouble terms increased by 19%. The exposure to exchange rate risk is shown in Note 29– Foreign exchange risk. We have two subsidiaries in the Russian Federation. KRKA-RUS LLC is engaged in the manufacture of pharmaceuticals. It produces the vast majority of products sold on the Russian market. KRKA FARMA LLC is engaged in marketing and sales activities. Krka considers that the situation in Ukraine and the Russian Federation has not changed the conditions for control by the parent company over the two Russian subsidiaries or that the controlling company retains influence over the voting rights and operations of these two Russian companies, including the influence on variable returns. Activities with the Russian subsidiaries continue in a similar manner as before February 2022, as EU Council Regulation 833/2014 permits a waiver of EU sanctions – subject to approval by the competent authority in the Member State – when pharmaceutical purposes are involved, and when the goods and services are used exclusively by legal entities in the Russian Federation that are owned or controlled exclusively by an EU-established legal entity. Payment transactions between the subsidiaries and the controlling company are carried out without any specificity, subject to the submission of the relevant documentation.
Krka's Russian subsidiaries hold various fixed assets such as business and production premises, equipment, vehicles, and inventories of raw materials, materials, finished products, and other assets. Krka Group's assets (excluding trade receivables) in both Krka's subsidiaries in the Russian Federation totalled €142,940 thousand as at 31 December 2024 and €155,560 thousand as at 31 December 2023. As established upon the impairment indicator analysis performed, no indicators existed at 31 December 2024 that would require impairment testing of the Krka Group's assets allocated to the cash-generating unit in the Russian Federation.
We are monitoring the situation and adjusting our operations to ensure production in our subsidiary in the Russian Federation and marketing and sales activities in the market. We have put in place additional receivables controls to closely monitor the liquidity of our business partners so that we can immediately adjust our activities in the event of any payment delays (Note 29– Credit risk). The assets of our companies in the Russian Federation have declined compared to 2023, mainly due to the weaker exchange rate.
| 2024 | Average headcount | Share (%) | 2023 | Average headcount | Share (%) |
|---|---|---|---|---|---|
| PhD | 202 | 1.7 | PhD | 203 | 1.8 |
| MSc | 414 | 3.5 | MSc | 400 | 3.4 |
| University education | 5,354 | 44.7 | University education | 5,359 | 45.9 |
| Higher professional education | 1,990 | 16.6 | Higher professional education | 1,836 | 15.7 |
| Vocational college education | 323 | 2.7 | Vocational college education | 304 | 2.6 |
| Secondary school education | 2,745 | 22.9 | Secondary school education | 2,625 | 22.5 |
| Skilled workers | 833 | 6.9 | Skilled workers | 817 |
123
123
11,984
100.0
11,667
100.0
| € thousand | 2024 | 2023 |
|---|---|---|
| Contract value of auditing the annual consolidated and separate financial statements performed by the audit firm KPMG Slovenija, d.o.o. | 133 | 128 |
| Contract value of auditing the subsidiaries’ reporting for the purpose of preparing the consolidated financial statements, performed by companies within the KPMG network | 57 | 93 |
| Contract value of auditing the subsidiaries’ local financial statements, performed by companies within the KPMG network | 66 | 45 |
| Total contract value of audit services | 256 | 266 |
| Contract value of the audit service relating to sustainability reporting (ESG) | 80 | 0 |
| Contract value of other non-audit services, rendered by the audit firm KPMG Slovenija, d.o.o. | 13 | 12 |
| Total contract value of non-audit services | 93 | 12 |
| Total contract value of services | 349 | 278 |
The contract value of audit services provided by other audit firms (outside the KPMG network) in relation to the audit of financial statements of subsidiaries for the purpose of compiling the consolidated financial statements amounted to €146 thousand (2023: €150 thousand).
The 2024 financial statements were not impacted by the events after the end of the period.
Joint venture Krka and the Indian company Laurus Labs Ltd. (hereinafter Laurus) established a joint venture, Krka Pharma Pvt. Ltd., headquartered in Hyderabad, India, in April 2024. Krka holds a 51% stake, and Laurus has a 49% stake in the joint venture.
In early October 2024, Krka contributed €2.5 million in initial capital, followed by a second instalment of registered capital on 10 March 2025, totalling €9,233,550 or 867,000 thousand Indian rupees.
Repurchase of treasury shares The Company repurchased 87,928 treasury shares between 1 January 2025 and 14 March 2025 and thus held 2,195,265 treasury shares at the end of this period, accounting for 6.69% of total shares.
317
318
319
320
321
322
323
€ thousand
| Property, plant and equipment | 10 | 609,628 | 595,525 | 102 |
|---|---|---|---|---|
| Intangible assets | 11 | 25,026 | 26,043 | 96 |
| Investments in subsidiaries | 12 | 355,265 | 357,265 | 99 |
| Investments in joint ventures | 2,492 | 0 | ||
| Loans | 13 | 23,401 | 41,243 | 57 |
| Investments | 14 | 22,023 | 47,673 | 46 |
| Deferred tax assets | 15 | 5,677 | 7,846 | 72 |
| Other non-current assets | 668 | 640 | 104 | |
| Total non-current assets | 1,044,180 | 1,076,235 | 97 | |
| Assets held for sale | 41 | 41 | 100 | |
| Inventories | 16 | 548,188 | 513,892 | 107 |
| Trade receivables | 17 | 518,425 | 463,126 | 112 |
| Other receivables | 17 | 13,800 | 47,116 | 29 |
| Loans | 13 | 9,025 | 65,699 | 14 |
| Investments | 14 | 249,794 | 306,769 | 81 |
| Cash and cash equivalents | 18 | 238,183 | 140,993 | 169 |
| Total current assets | 1,577,456 |
| 1,537,636 | 103 | Total assets | 2,621,636 | 2,613,871 | 100 |
|---|---|---|---|---|---|
| Equity | Share capital | 19 | 54,732 | 54,732 | 100 |
| Treasury shares | 19 | –163,491 | –138,489 | 118 | |
| Reserves | 19 | 304,943 | 290,481 | 105 | |
| Retained earnings | 19 | 1,990,167 | 1,926,534 | 103 | |
| Total equity | 2,186,351 | 2,133,258 | 102 | ||
| Liabilities | Provisions | 22 | 125,667 | 113,999 | 110 |
| Deferred income | 23 | 2,585 | 2,366 | 109 | |
| Lease liabilities | 28 | 2,181 | 2,565 | 85 | |
| Total non-current liabilities | 130,433 | 118,930 | 110 | ||
| Trade payables | 24 | 171,183 | 175,847 | 97 | |
| Borrowings | 21 | 17,805 | 88,061 | 20 | |
| Lease liabilities | 28 | 1,118 | 1,022 | 109 | |
| Income tax payables | 17,524 | 0 | |||
| Contract liabilities | 25 | 18,112 | 18,953 | 96 | |
| Other current liabilities | 26 | 79,110 | 77,800 | 102 | |
| Total current liabilities | 304,852 | 361,683 |
| € thousand | Notes | 2024 | 2023 | Index 2024/23 |
|---|---|---|---|---|
| Revenue | 1,766,021 | 1,674,572 | 105 | |
| – Revenue from contracts with customers | 3 | 1,755,248 | 1,664,611 | 105 |
| – Other revenue | 10,773 | 9,961 | 108 | |
| Cost of goods sold | –782,253 | –786,145 | 100 | |
| Gross profit | 983,768 | 888,427 | 111 | |
| Other operating income | 4 | 3,155 | 1,639 | 192 |
| Selling and distribution expenses | –321,400 | –300,863 | 107 | |
| – Whereof net impairments and write-offs of receivables | 2,124 | 3,960 | 54 | |
| R\&D expenses | –179,822 | –173,783 | 103 | |
| General and administrative expenses | –99,704 | –93,112 | 107 | |
| Operating profit | 385,997 | 322,308 | 120 | |
| Financial income | 8 | 34,967 | 60,964 | 57 |
| Financial expenses | 8 | –39,996 | –54,223 | 74 |
| Net financial result | –5,029 | |||
| Profit before tax | 380,968 | 329,049 | 116 |
| 2024 | 2023 | Index | |
|---|---|---|---|
| Net profit | 321,192 | 294,481 | 109 |
| Basic earnings per share (€) | 10.43 | 9.51 | 110 |
| Diluted earnings per share (€) | 10.43 | 9.51 | 110 |
The accompanying Notes form an integral part of the separate financial statements and should be read in conjunction with them.
| € thousand | Notes | 2024 | 2023 | Index |
|---|---|---|---|---|
| Net profit | 321,192 | 294,481 | 109 | |
| Other comprehensive income that will not be reclassified to profit or loss at a future date | ||||
| Change in fair value of financial assets | 14 | –4,877 | 10,912 | |
| Restatement of post-employment benefits | 22 | –7,864 | –12,133 | 65 |
| Deferred tax effect | 15 | 577 | –2,493 | |
| Net other comprehensive income that will not be reclassified to profit or loss at a future date | –12,164 | –3,714 | 328 | |
| Total other comprehensive income for the year (net of tax) | –12,164 | –3,714 | 328 | |
| Total comprehensive income for the year (net of tax) | 309,028 | 290,767 | 106 |
The accompanying Notes form an integral part of the separate financial statements and should be read in conjunction with them.
| € thousand | Share capital | Treasury shares | Reserves | Retained earnings | Total equity |
|---|---|---|---|---|---|
| Reserves for treasury shares | |||||
| Share premium | |||||
| Legal reserves | |||||
| Statutory reserves |
| 54,732 | –138,489 | 138,489 | 105,897 | 14,990 | 30,000 | 1,105 | 1,544,595 | 101,381 | 280,558 | 2,133,258 |
|---|---|---|---|---|---|---|---|---|---|---|
| 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 321,192 | 321,192 |
|---|---|---|---|---|---|---|---|---|---|---|
| 0 | 0 | 0 | 0 | 0 | 0 | –10,540 | 0 | –1,624 | 0 | –12,164 |
|---|---|---|---|---|---|---|---|---|---|---|
| 0 | 0 | 0 | 0 | 0 | 0 | –10,540 | 0 | –1,624 | 321,192 | 309,028 |
|---|---|---|---|---|---|---|---|---|---|---|
| 0 | 0 | 0 | 0 | 0 | 0 | 0 | 75,503 | –75,503 | 0 | 0 |
|---|---|---|---|---|---|---|---|---|---|---|
| 0 | 0 | 0 | 0 | 0 |
|---|---|---|---|---|
| € thousand | Share capital | Treasury shares | Reserves | Retained earnings | Total equity | Reserves for treasury |
|---|---|---|---|---|---|---|
| 0 | 280,558 | –280,558 | 0 | 0 | 0 | 0 |
| 0 | –25,002 | 0 | 0 | 0 | 0 | 0 |
| 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| 0 | –25,002 | 0 | 0 | 0 | 0 | 0 |
| 0 | 0 | 25,002 | 0 | 0 | 0 | 0 |
| 0 | –25,002 | 0 | 0 | 0 | 0 | 0 |
| 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| 0 | –230,933 | 0 | –230,933 | 0 | 0 | 0 |
| 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| 0 | –25,002 | 25,002 | 0 | 0 | 0 | 0 |
| 0 | 75,503 | –25,878 | –305,560 | –255,935 | 0 | 0 |
| Balance at 31 Dec 2024 | 54,732 | –163,491 | 163,491 | 105,897 | 14,990 | 30,000 |
| 0 | –9,435 | 1,620,098 | 73,879 | 296,190 | 2,186,351 |
| Share premium | Legal reserves | Statutory reserves | Fair value reserve | Other profit reserves | Retained earnings from previous years | Profit for the year |
|---|---|---|---|---|---|---|
| 54,732 | –124,566 | 124,566 | 105,897 | 14,990 | 30,000 | 4,307 |
| 1,442,702 | 69,974 | 338,190 | 2,060,792 | |||
| Net profit | 0 | 0 | 0 | 0 | 0 | 0 |
| 0 | 294,481 | |||||
| Total other comprehensive income for the year (net of tax) | 0 | 0 | 0 | 0 | 0 | –3,202 |
| –512 | 0 | |||||
| Total comprehensive income for the year (net of tax) | 0 | 0 | 0 | 0 | 0 | 290,767 |
| Transactions with owners, recognised in equity | Formation of other profit reserves under the resolution of the AGM | 0 | 0 | 0 | 0 | 0 |
| 101,893 | –101,893 | 0 |
| 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 338,190 | –338,190 | 0 | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Repurchase of treasury shares | 0 | –13,923 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | –13,923 | |
| Formation of reserves for treasury shares | 0 | 0 | 13,923 | 0 | 0 | 0 | 0 | 0 | –13,923 | 0 | |
| Dividends paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | –204,378 | 0 | –204,378 | |
| Total transactions with owners, recognised in equity | 0 | –13,923 | 13,923 | 0 | 0 | 0 | 0 | 101,893 | 31,919 | –352,113 | –218,301 |
| Balance at 31 Dec 2023 | 54,732 | –138,489 | 138,489 | 105,897 | 14,990 | 30,000 | 1,105 | 1,544,595 | 101,381 | 280,558 | 2,133,258 |
The accompanying Notes form an integral part of the separate financial statements and should be read in conjunction with them.
| € thousand | Notes | 2024 | 2023 |
|---|---|---|---|
| Net profit | 321,192 | 294,481 |
|---|---|---|
| Adjustments for: | ||
| – Amortisation/Depreciation | 124,402 | 74,451 |
| – Net foreign exchange differences | –606 | 1,955 |
| – Net write-offs and allowances for inventories | 17,311 | 9,808 |
| – Net impairments and write-offs of receivables | –2,124 | –3,960 |
| – Investment income | –35,952 | –61,729 |
| – Investment expenses | 7,015 | 6,232 |
| – Income on financing activities | –6 | –1 |
| – Interest expenses and other financial expenses | 7,835 | 7,339 |
| – Income tax expense | 59,776 | 34,568 |
| Operating profit before changes in net current assets | 445,594 | 368,932 |
| Change in trade receivables | –52,006 | –103,777 |
| Change in inventories | –51,607 | –30,722 |
| Change in trade payables | –7,616 | –14,391 |
| Change in provisions | –410 | 1,871 |
| Change in deferred income | 219 | –450 |
| Change in other current liabilities | 3,913 | 17,776 |
| Income tax paid | –17,568 | –83,840 |
| Net cash flow from operating activities | 320,519 | 155,399 |
| Interest received | 11,434 | 7,502 |
|---|---|---|
| Dividends received | 941 | 798 |
| Proportionate profit of subsidiaries | 14,216 | 29,890 |
| Proceeds from sale of property, plant and equipment | 361 | 1,380 |
| Purchase of property, plant and equipment | 10 |
| Purchase of intangible assets | –78,750 |
|---|---|
| Acquisition of subsidiaries and share of non-controlling interests net of financial assets acquired | –109,515 |
| Refunds of subsequent contributions to subsidiaries | 0 |
| Payments for acquiring joint ventures | 2,000 |
| Proceeds from non-current loans | –2,492 |
| Payments for non-current loans | 31,954 |
| Net proceeds from/payments for current loans | –3,184 |
| Proceeds from sale of non-current investments | 45,270 |
| Payments for acquiring non-current investments | –50,984 |
| Proceeds from sale of current investments | 71,167 |
| Payments for acquiring current investments | 33,333 |
| Proceeds from derivatives | –56 |
| Payments for derivatives | –22 |
| Net cash flow from investing activities | –1,696 |
| Interest paid | –3,704 |
|---|---|
| Net payments for/proceeds from current borrowings | 29 |
| Lease liabilities paid | –70,109 |
| Dividends and other profit shares paid | –1,165 |
| Repurchase of treasury shares | –230,884 |
| Net cash flow from financing activities | –330,864 |
| Net increase/decrease in cash and cash equivalents | –188,159 |
|---|---|
| Cash and cash equivalents at beginning of year | 140,993 |
| Effect of foreign exchange rate fluctuations on cash held | –406 |
| Closing balance of cash and cash equivalents | 238,183 |
The accompanying Notes form an integral part of the separate financial statements and should be read in conjunction with them.
Krka, d. d., Novo mesto is the controlling company in the Krka Group with its registered seat at Šmarješka cesta 6, 8501 Novo mesto, Slovenia. The Company was registered at the District Court of Novo mesto on 13 July 1989, registration number 1/00097/00. Company registration No.: 5043611000.
The Company's financial statements refer to the year ended 31 December 2024.
The Company develops, produces, markets and sells human health products (prescription pharmaceuticals and non-prescription products), and animal health products.
The financial statements of the Company have been prepared in accordance with International Financial Reporting Standards (‘IFRS’) as adopted by the EU, interpretations issued by the International Financial Reporting Interpretations Committee of the IASB (‘IFRIC’) adopted by the EU, and in compliance with additional provisions required by the Companies Act (ZGD–1). The Krka Management Board approved the financial statements on 24 March 2025.
The financial statements have been prepared on the historical cost basis, with the exception of derivatives, financial instruments at fair value through profit or loss and financial instruments at fair value through OCI for which fair value was used. Methods applied in the measurement of fair value are presented in Note 2 – Fair value.
The financial statements are presented in the euro, the Company’s functional currency. All financial information presented in the euro has been rounded to the nearest thousand.
The preparation of financial statements requires the Management Board of the controlling company to make judgements, estimates and assumptions that affect the carrying amounts of assets and liabilities of Krka as well as the reported income and expenses for the period.
These include, among others: determination of the useful life and residual value of property, plant and equipment, as well as intangible assets; income from contracts with customers, allowances made for inventories and receivables; investment impairment; assumptions material to the actuarial calculation of defined employee benefits; assumptions used in the calculation of potential provisions for disputes, and an estimate of the duration of the lease and the interest rate used.
Regardless of the fact that the Company’s Management Board duly considers all factors that may impact the preparation of these assumptions, the actual consequences of business events may differ from those estimates. In making accounting estimates, management makes judgements while considering potential changes in the business environment, new business events, new and additional information that may be available, and experience.
Key estimates and assumptions as at the day of the statement of financial position that are associated with future operations and which could result in significant adjustment of the book values of assets and liabilities are presented below.
Information on significant estimates about uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amounts recognised in the financial statements is presented in the following notes:
Given the large number of contracts with customers, the Company determined the expected value method as the most appropriate for estimating variable consideration for the sale of products with a right to return. To estimate the variable consideration for expected future volume rebates on the quantity of products purchased, the Company identified a combination of the most likely amount method and the expected value method as the most appropriate. The method that best predicts the amount of variable consideration is primarily driven by the number of volume thresholds contained in the contracts, legal provisions and business practices in various environments. The most likely amount method is best suited for contracts with a single-volume threshold, and the expected value method for contracts with more than one volume threshold.
Prior to including any variable consideration in the transaction price, the Company assesses whether there is a constraint on variable consideration. Based on experience, business forecasts and current economic conditions, the Company has determined that there are no constraints on variable consideration. The Company is a seller of products that may be subject to payment terms in excess of one year in certain markets. The Company recognises financial income and expenses on these sales using the appropriate discount rate.
- Note 10 – Testing the useful lives of property, plant and equipment
The Company's annual review of the appropriateness of the annual depreciation rates or useful lives of plant and equipment resulted in different expectations from previous estimates. As a result, new (mostly longer) useful lives and therefore lower depreciation rates for each type of asset were defined. The useful lives of production and laboratory equipment, furniture, and means of transportation have changed as well.
- Note 12 – Impairment testing of investments in subsidiaries
The controlling company checks whether there are any indicators of impairment of investments in subsidiaries at least once a year. The fair value of investments that may be impaired is determined as the present value of future cash flows, which is based on an estimate of expected cash flows from the cash-generating unit and on determination of the appropriate discount rate. Upon the impairment indicator analysis performed, the Company concluded that no indicators exist as at 31 December 2024 that would trigger impairment testing and therefore there was no need to impair the investments in subsidiaries.
- Note 17 – Impairment of receivables
On the financial statement preparation (quarterly and annually), the Company recognises allowances (impairment) of those receivables for which it is assumed that will not be settled in full or not at all. Allowances are recognised using a uniform methodology applicable to the Krka Group and taking into consideration the probability or assessed probability of receivable settlement by the debtors. The methodology includes quantitative and qualitative criteria grouped into the following four sets: an analysis of the existing business dealings with the customer, an analysis of...
the customer's financial statements, a qualitative assessment of the customer by the salespersonnel, and an assessment of the customer's country risk. For all customers whose receivables are insured by an insurance company or other first-class insurance, insurance is taken into account when assessing the amount of impairments. Hence, allowances of receivables due from individual customers are calculated using an algorithm that includes all the above criteria.
Defined post-employment benefit obligations include the present value of termination benefits on retirement. They are recognised on the basis of the actuarial calculation using assumptions and estimates effective at the time of the calculation, and which may, as a result of future changes, differ from actual assumptions applicable at that future time. This applies primarily to the determination of a discount rate, assessment of employee turnover, mortality assessment, and assessment of an increase in salaries. Due to the complexity of the actuarial calculation and the long-term nature of the item, defined benefit obligations are sensitive to changes in the above estimates and assessments.
Lawsuits and claims may be brought against the Company for alleged breaches of intellectual property (patent rights or competition law) and those referring to other civil law areas. A provision is recognised when the Company has present obligations (legal or constructive) as a result of past events, a reliable estimate can be made of the amount of obligation, and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation. Contingent liabilities are not recognised in the financial statements as their actual existence will be confirmed only upon the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company. The Company’s Management Board continually assesses contingent liabilities to determine whether an outflow of resources embodying economic benefits has become probable. If this is the case, a provision is recognised in the financial statements of the period in which the change in probability occurs.
The Company, as the controlling company, applied the same accounting policies in all periods presented in the accompanying financial statements. The accounting policies and the calculation methods used are the same as for the last annual reporting, except for the newly adopted standards and interpretations which are noted below and were applied if relevant events occurred in the Company in the reporting period.
In its statement of financial position, the Company classifies liabilities and assets according to their maturity, i.e. as non-current and current.
The Company classifies all other assets as non-current.
All other liabilities are classified by the Company as non-current.
Transactions and balances in foreign currencies are translated to the euro (the Company's functional currency) at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are converted to the functional currency at the exchange rate at that date. Non-monetary assets and liabilities denominated in foreign currencies are translated to the euro at the exchange rate applicable on the reporting date. Non-monetary assets and liabilities denominated in foreign currencies and measured at the fair value are converted to the euro at the exchange rate at the date that the fair value was determined. Foreign currency differences are recognised in profit or loss, except for differences arising on the translation of equity instruments, which are recognised directly in other comprehensive income. Non-cash items measured at historical cost in foreign currency are translated to the functional currency by applying the exchange rate valid at the date of the transaction.
A number of the Company’s accounting policies and disclosures require the determination of fair value, for both financial and non-financial assets and liabilities. Fair value is the amount for which an asset could be sold or a liability exchanged in a regular transaction between market participants. All assets and liabilities measured and disclosed at their fair value in financial statements are classified in the fair value hierarchy based on the lowest level of input data significant for measurements of total fair value:
The fair value of individual groups of assets has been determined for measurement and/or disclosure purposes based on the methods presented below. Where applicable, further information about the assumptions made in determining fair values is disclosed in the Notes specific to that asset or liability.
The fair value of financial assets at fair value through profit or loss and at fair value through other comprehensive income (FVOCI) is determined by reference to their quoted closing bid price. For investments in debt securities at amortised cost, for reporting purposes, the fair value is calculated based on the closing rate, which is increased by accrued interest on the reporting date.
The fair value of trade and other receivables is estimated at the present value of future cash flows discounted at the market rate of interest effective at the reporting date.
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.
Financial assets of the Company include cash and cash equivalents, receivables, derivatives, loans and investments and investments in subsidiaries (refer to accounting policies ‘Investments in subsidiaries’).
Financial assets are classified, at initial recognition, as subsequently measured at amortised cost, fair value through other comprehensive income (OCI), and fair value through profit or loss.
The classification of financial assets at initial recognition depends on the financial assets’ contractual cash flow characteristics and the Company's business model for managing them. With the exception of trade receivables that do not have a significant financing component or for which the Company has applied the practical expedient, the Company initially measures a financial asset at fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. Trade receivables that do not have a significant financing component or for which the Company has applied the practical expedient are measured at the transaction price determined under IFRS 15 (refer to the accounting policies in section ‘Revenue from contracts with customers’).
For financial assets to be classified and measured at amortised cost or fair value through OCI, they need to give rise to cash flows that are “solely payments of principal and interest (SPPI)” on the principal amount outstanding. This assessment is referred to as the SPPI test and is performed at an instrument level.
The Company's business model for managing financial assets refers to how it manages its financial assets in order to generate cash flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial assets, or both.
Where the Company selects a business model that aims to collect contractual cash flows, it values its financial assets (debt instruments) at amortised cost. If the Company acquires financial assets (debt instruments) with the intent to collect contractual cash flows and for sale, then they are measured at fair value through other comprehensive income by recycling cumulative gains and losses. Where the Company does not choose any of these business models, it measures its financial assets (debt instruments) at fair value through profit or loss. Financial assets that have the characteristics of an equity instrument in accordance with IAS 32– Financial Instruments, are classified as equity instruments at fair value through other comprehensive income without recycling cumulative gains and losses after derecognition.
Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the marketplace (regular way trades) are recognised on the trade date, i.e. the date that the Company commits to purchase or sell the asset.
The Company derecognises a financial asset when the contractual rights to the cash flows from the asset expire or when it transfers the rights to the contractual cash flows from the financial asset in a transaction that transfers all the risks and rewards of ownership of the financial asset.
For purposes of subsequent measurement, financial assets are classified into four categories:
Cash and cash equivalents comprise cash, bank deposits up to three months, and other current, highly realizable investments with an original maturity of three months or less. The latter is easily converted into known amounts of cash and for which the risk of changes in value is insignificant. The cash flows derived from these assets are solely payments of the principal and interest are therefore classified as financial assets at amortised cost.
According to the SSPI test, loans issued by the Company are classified as financial assets at amortised cost, since the cash flows derived from these assets are solely payments of the principal and interest on the principal amount outstanding. The Company's investments in debt securities, which comprise only low-credit risk government bonds, are classified as financial assets at amortised cost.
The Company’s financial assets at amortised cost also include trade receivables. After initial recognition, these investments are measured using the effective interest method and are subject to impairment. Gains and losses are recognised in profit or loss when the asset is derecognised, modified or impaired.
Subsequent to initial recognition, they are measured at fair value. Interest income, foreign exchange differences, and impairment losses or reversals are recognised in the statement of profit or loss and computed in the same manner as for financial assets measured at amortised cost. The remaining fair value changes are recognised in OCI. Upon derecognition, the cumulative fair value change recognised in OCI is recycled to profit or loss.
Subsequent to initial recognition, they are measured at fair value. Changes in fair value are recognised directly in other comprehensive income. When an investment is derecognised, the cumulative gain or loss in equity is not transferred to profit or loss.
Financial assets at fair value through profit or loss include financial assets held for trading, financial assets designated upon initial recognition at fair value through profit or loss, or financial assets mandatorily required to be measured at fair value. Financial assets are classified as held for trading if they are acquired for the purpose of selling or repurchasing in the near term. Derivatives, including separated embedded derivatives, are also classified as held for trading unless they are designated as effective hedging instruments. Financial assets with cash flows that are not solely payments of principal and interest are classified and measured at fair value through profit or loss, irrespective of the business model. Financial assets at fair value through profit or loss are carried in the statement of financial position at fair value, with net changes in fair value recognised in the statement of profit or loss.
Impairment of financial assets is described in the section Impairment – Financial assets.
Non-current investments made in equity of subsidiaries included in consolidated financial statements are valued at cost. Participation in the profit of a subsidiary is recognised in the profit or loss of the controlling company when an appropriate resolution referring to profit distribution has been adopted. If the investment is required to be impaired due to a subsidiary's loss, the amount of loss due to impairment is measured as the difference between the carrying amount of the investment and the present value of expected future cash flows.
Non-current equity investments in equity of joint ventures are accounted for at cost. The Company recognises in its profit or loss an interest in the profit or loss of a joint venture as soon as the joint venture acquires the right to participate in the profit. The Company shall derecognise its share in the losses of a joint venture when its share in the losses of the joint venture is equal to or greater than its share in the joint venture (when the value of the investment is zero).
Property, plant and equipment items are measured at cost less accumulated depreciation and impairment losses (refer to the accounting policy ‘Impairment’). The cost of an item of property, plant and equipment as at 1 January 2004, the date of transition to IFRS, is determined by reference to its fair value at that date. Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labour, any other directly attributable cost of making the asset ready for its intended use, and (if applicable) assessed costs of dismantling and removing the items and restoring the site on which they were located, as well as capitalised borrowing costs. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment.
Items of property, plant and equipment that have substantially different useful lives but whose value is significant are accounted for as individual assets. Gains and losses on disposal of an item of property, plant and equipment are determined as the difference between proceeds from disposal and the carrying amount of property, plant and equipment and are recognised within other operating income or other operating expenses in profit or loss.
The Company includes borrowing costs directly attributable to the acquisition, construction or production of the asset under construction in the cost of property, plant and equipment. Borrowing costs related to the acquisition or construction of the relevant assets are capitalised if they relate to the acquisition of a significant asset, and the construction or preparation for use of the relevant assets takes more than six months.
The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Company and its cost can be measured reliably. The carrying amount of the replaced part is derecognised. All other costs are recognised in profit or loss as an expense when incurred.
Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful lives of each item of property, plant and equipment or its individual parts. Land and assets being acquired are not depreciated.
| 2024 | 2023 | |
|---|---|---|
| Buildings | ||
| – Management and administrative facilities | 60 | 60 |
| – Production and warehouse facilities | 40 | 40 |
| – Other | 15 to 20 | 15 to 20 |
| Property, plant and equipment | ||
| – Production equipment | 3 to 15 | 5 to 20 |
| – Laboratory equipment | 7 to 15 | 10 |
| – Other | 5 to 20 | 5 |
| Furniture | 5 or 10 | 5 |
| Computer equipment | 4 to 6 | 4 to 6 |
| Means of transportation | 6 to 15 | 5 to 15 |
At the commencement date of the lease, the Company recognises lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in-substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid by the Company under residual value guarantees. The lease payments also include the exercise price of a purchase option reasonably certain to be exercised by the Company and payments of penalties for terminating the lease if the lease term reflects the Company exercising the option to terminate. Variable lease payments that do not depend on an index or a rate are recognised in profit or loss as expenses in the period in which the event or condition that triggers the payment occurs.
In calculating the present value of lease payments, the Company uses its incremental borrowing rate based on estimated bond returns if it were to incur debt on the financial markets, while considering their maturity if the interest rate implicit in the lease is not readily determinable.
After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. The carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the lease payments (e.g. change of future payments resulting from a change in an index or rate used to determine such lease payments) or a change in the assessment of an option to purchase the underlying asset.
For short-term leases and leases where the leased asset is of low value, the Company applies the practical expedient allowed by the standard and recognises lease payments as an expense on a straight-line basis over the lease term. The practical expedient is applied to leases with a lease term of less than one year and leases where the cost of the new leased asset is less than €5,000.
The Company recognises a right-of-use property, plant and equipment asset and a lease liability at the inception of the lease (i.e. the date the leased asset is available for use).
Right-of-use assets are measured at cost less any accumulated depreciation and impairment losses and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received, as well as an assessment of costs that will be incurred in dismantling or removing the leased asset, restoring the site to its original condition, or returning the asset to a condition as required in the lease terms. The Company depreciates the right-of-use assets on a straight-line basis over the shorter of the estimated lease term or the estimated useful lives of the assets.
Leases in which the Company does not transfer substantially all the risks and rewards incidental to ownership of an asset are classified as operating leases. Rental income arising is accounted for on a straight-line basis over the lease terms and is included in revenue in the statement of profit or loss. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same basis as rental income.
Development costs are not capitalised because the Company does not distinguish between the research and development phases. All costs relating to research and development work within the Company are recognised in profit or loss as incurred.
Other intangible assets that are acquired by the Company, which have finite useful lives, are measured at cost less accumulated amortisation and accumulated impairment losses (refer to the accounting policy ‘Impairment’).
Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset it pertains to. All other expenditure is recognised in profit or loss as incurred.
The Company recognises emission coupons purchased or acquired free of charge in order to fulfil its obligation to the State to surrender emission coupons under the Environmental Protection Act as intangible assets. Emission coupons acquired free of charge are carried at €1 per emission coupon and those purchased are measured at cost on initial recognition. The first-in-first-out (FIFO) method is used for the transfer of coupons. Intangible assets relating to emission coupons are not amortised.
Amortisation is recognised on a straight-line basis over the estimated useful lives of intangible assets from the date that they are made available for use. The estimated useful lives for software, licences and other rights range from 3 to 10 years.
In the statement of financial position, inventories are measured at the lower of cost and net realisable value. Net realisable value is the estimated selling price at the reporting date less selling expenses and other potential administrative expenses, which are usually associated with the sale. The Company reviews the net realisable value of inventories once a year at the date of the statement of financial position. If the carrying amount of inventories exceeds their net realisable value, inventories are impaired through profit or loss.
As of the reporting date, the Company also reviews whether inventories need to be impaired. Thus, impaired are:
All direct costs of purchase. Inventories of material are carried at moving average prices. Inventories of finished products and work in progress are carried at standard cost, which, in addition to the direct cost of material, includes the cost of production, such as: direct labour cost, depreciation, cost of services, energy, maintenance, and quality. Fixed price variances are determined in accordance with the current valuation of inventories using production costs. A quantity unit of merchandise is valued at cost, including cost of purchase, import duties, and all costs directly attributable to the acquisition decreased by discounts. Inventories of merchandise are carried at moving average prices.
The Company recognises an allowance for the expected credit losses (ECLs) for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Company expects to receive, discounted at an approximation of the original effective interest rate. The expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms.
Expected credit losses are recognised in two stages. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12 months (a 12-month ECL). For those credit exposures for which there has been a significant increase in credit risk since the initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).
The Company applies a simplified approach in calculating ECLs for trade receivables and contract assets. Trade receivables that do not have a significant financing component or for which the Company has applied the practical expedient (contracts agreed for a period of one year or less) are measured at the transaction price determined under IFRS 15, less any impairment losses.
Therefore, the Company does not track changes in credit risk, but instead recognises a loss allowance based on a lifetime ECL at each reporting date. The Company has established a provision matrix that is based on its credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment. Allowances are recognised using a uniform methodology applicable to the Company and in consideration of the probability or assessed probability of receivable settlement by the debtors.
The Company measures expected credit losses annually for investments that include government bonds measured at amortised cost. Except when a 12-month expected credit loss is recognised, the Company recognises an allowance for credit losses in an amount equal to the expected credit loss over the life of the financial instrument. A 12-month expected credit loss is recognised by:
The Company considers a debt security to have low credit risk if its credit risk rating is equivalent to the globally understood definition of ‘investment grade’ a rating of Baa2 or above by Moody’s or BBB– or above by S&P Global Ratings. The Company monitors changes in credit risk by tracking published external credit ratings. The probabilities of default (PD), both 12-month and over the life of the financial instrument, are based on information of the external credit rating agency. The external credit rating agencies also report the loss given default (LGD) ratios, which reflect the assumed recovery rate.
The carrying amounts of the Company’s non-financial assets, except for inventories and deferred tax assets, are reassessed at each reporting date to determine whether there is any indication of impairment. If such indications exist, the asset’s recoverable amount is assessed.
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to the present value using a pre–tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets are grouped together. These are the smallest groups of assets that generate cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets.
An impairment of an asset or cash-generating unit is recognised when its carrying amount exceeds its recoverable amount. Impairment is recognised in the income statement. A loss recognised in a cash-generating unit as a result of impairment is allocated by first reducing the carrying amount of goodwill allocated to the cash-generating unit and then to the other assets of the unit (group of units) in proportion to the carrying amount of each asset in the unit.
Impairment losses recognised in previous periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount of the asset. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised in the previous periods.
When treasury shares recognised as a part of share equity are repurchased, the amount of the consideration paid, including directly attributable costs, is recognised as a deduction from equity. Repurchased shares are classified as treasury shares and are presented as a deduction from total equity.
Dividends are recognised in the Company’s financial statements in the period in which they are declared by the Annual General Meeting.
Current employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided.
A provision is recognised if, as a result of a past event, the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the estimated future cash flows to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the liability.
The Company recognises provisions for lawsuits primarily related to alleged patent infringements. The adequacy of these provisions, based on the likelihood of a favourable or unfavourable outcome, is assessed annually. The provision amounts are determined either by the amount of the indemnification claim or, if no claim has been disclosed, by an estimated potential amount.
The Company develops, produces, markets and sells human health products (prescription pharmaceuticals, non-prescription products), animal health products, and material. Revenue from contracts with customers is recognised when control of the goods and services is transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services while considering specific terms and conditions of an individual contract.
Transfer of control over those goods and services depends on the terms and conditions of the contract. In general, control is transferred when goods are accepted by the customer or services are rendered. The standard credit term ranges from 30 to 120 days.
The Company assesses the performance obligations contained in each sales contract and determines whether additional promises in the contract constitute separate performance obligations requiring allocation of a portion of the transaction price. In determining the transaction price for the sale of products, the effects of variable consideration are considered, as well as the existence of significant financing components.
If the consideration in a contract includes a variable amount, the Company estimates the amount of consideration to which it will be entitled in exchange for transferring the goods to the customer. The variable consideration is estimated at contract inception and constrained until it is highly probable that a significant revenue reversal in the amount of cumulative revenue recognised will not occur when the associated uncertainty with the variable consideration is subsequently resolved. Some contracts for the sale of products provide customers with a right of return, bonuses, and volume rebates. The rights of return, bonuses, and volume rebates give rise to variable consideration.
Certain contracts provide a customer with a right to return goods that are past the expiry date. The Company uses the expected value method to estimate the goods that will not be returned because this method best predicts the amount of variable consideration to which it will be entitled. The requirements of IFRS 15 on constraining estimates of variable consideration are also applied in order to determine the amount of variable consideration that can be included in the transaction price. For goods that, based on experience and business practice in a given environment, are expected to be returned instead of generating revenue, the Company recognises a refund liability. A right-of-return asset (and corresponding adjustment to cost of products sold) is also recognised to account for the right to recover products from customers.
The Company provides retrospective bonuses and volume rebates to certain customers once the quantity or value of products purchased during the period exceeds a threshold specified in the contract. Rebates are offset against amounts payable by the customer. The Company estimates the variable consideration for the expected future bonuses and volume rebates based on terms and conditions of the contract including criteria and elements that provide the basis for the recognition of those bonuses and volume rebates. For valuation, the Company uses the most probable value method or the expected value method. The method chosen, which best predicts the value of the rebates and volume discounts, is based on the number of thresholds in the contract.
Disclosures about the use of estimates and judgements in estimating variable consideration are provided in the Basis of preparation of the financial statements section.
In some cases, the Company receives current advances from its customers. Using the practical expedient in IFRS 15.63, the Company does not adjust the promised amount of consideration for the effects of a significant financing component if it expects, at contract inception, that the period between the transfer of the promised goods or services to the customer and when the customer pays for those goods or services will be one year or less.
A contract asset is the right to an amount of consideration in exchange for goods or services transferred to the customer. If the Company transfers goods or services to a customer before receiving payment or before payment becomes due, a contract asset is recognised for the conditional earned consideration. Once the transaction is completed and the customer is confirmed, the contract assets are reclassified as trade receivables.
A receivable is the Company’s right to an amount of consideration that is unconditional, i.e. only the passage of time is required before payment of consideration is due (refer to the accounting policy ‘Recognition of financial instruments’).
A contract liability is the obligation to transfer goods or services to a customer for which the Company has received consideration (or an amount of consideration is due) from the customer. If a customer pays consideration before the goods or services are transferred to the customer, a contract liability is recognised when the payment is made, or the payment becomes due (whichever is earlier). Contract liabilities are recognised as revenue when the Company performs under the contract.
A refund liability is the obligation to refund some or all of the consideration received (or receivable from the customer). The refund liability arises from bonuses and volume discounts. It is measured at the amount the Company ultimately expects it will have to return to the customer.
The Company updates its estimates of refund liabilities (and the corresponding change in the transaction price) at the end of each reporting period. The described accounting policy applies also to the variable consideration. It is irrelevant to the Company’s assessment of the role it plays in individual customer contracts, as it usually acts as a principal. The Company does not normally have long-term sales contracts with customers.
Revenue referring to government grants is initially recognised when there is reasonable assurance that they will be received and that the Company will comply with the conditions associated with the grants. Revenue that compensates the realised expenses is recognised in profit or loss on a systematic basis in the same periods in which the costs are recognised. Revenue that compensates an entity for the cost of an asset is recognised in profit or loss on a systematic basis over the useful life of the asset.
The Company recognises emission coupons received free of charge from the State within government grants received. The emission coupons received free of charge are recorded as intangible assets at a value of €1 per emission coupon. The Krka Group reduces intangible assets and recognises other operating income upon their transfer.
Financial income comprises interest income on funds invested, dividend income, gains on the disposal of financial assets, changes in the fair value of financial assets at fair value through profit or loss, foreign exchange gains and gains on hedging instruments that are recognised in profit or loss. Interest income is recognised as it accrues in profit or loss using the effective interest method. Dividend income is recognised on the date that the shareholder’s right to receive payment is established, which in the case of quoted securities is the ex-dividend date.
Financial expenses comprise interest expense on borrowings, foreign exchange losses, changes in the fair value of financial assets at fair value through profit or loss, impairment losses recognised on financial assets, and losses on hedging instruments that are recognised in profit or loss. All borrowing costs are recognised in profit or loss using the effective interest method, except those that are attributable to property, plant and equipment under construction.
Income tax expense comprises current, top-up and deferred tax. Income tax expense is recognised in profit or loss except to the extent that it relates to items recognised directly in other comprehensive income. Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted at the reporting date, and any adjustment to tax payable in respect of previous financial years.
Deferred tax is recognised using the balance sheet liability approach providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for the following temporary differences: the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit, and differences relating to investments in subsidiaries and jointly controlled entities to the extent that it is probable that they will not reverse in the foreseeable future. Also, deferred tax is not recognised for taxable temporary differences arising on the initial recognition of goodwill. The amount of deferred tax is based on the expected manner of settling the carrying amount of assets and liabilities using tax rates enacted at the reporting date. Deferred tax assets are offset against deferred tax liabilities when an entity has a legal right to offset current assets and liabilities, and deferred tax assets and liabilities relate to the same taxable entity and the same tax authority.
A deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available against which the deferred tax asset can be utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised.
In 2023, Slovenia adopted the Minimum Tax Act, incorporating a minimum tax into the Slovenian tax-law system to ensure that large international and domestic groups are subject to a global minimum taxation of profits at an effective tax rate of 15%. The Act was adopted based on EU Directive 2022/2523 on the provision of a global minimum tax rate for international and large domestic groups in the EU, which was drafted based on the GLOBE Model Rules prepared by the Organisation for Economic Co-operation and Development (OECD) in October 2021. The Act's minimum tax rules apply to the Krka Group's financial years starting from 1 January 2024.
The Krka Group is subject to the minimum tax rules for the financial year 2024 onwards. The Company for the first time calculated the Krka Group's top-up tax and the domestic top-up tax for Slovenia for the year 2024. In Slovenia, the Company can benefit from simplifications during the initial years of applying the rules (transitional CbCR Safe Harbour), exempting it from calculating the domestic top-up tax. The Company accounts for deferred tax in accordance with the provisions of IAS 12. The Company benefits from the current exception to calculate deferred taxes for the effects of the top-up tax and the value of the taxes is recognised as current tax as it arises.
The Company presents basic earnings per share (EPS) data. EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the average number of ordinary shares issued during the financial year, whereby treasury shares are excluded. Diluted earnings per share is equal to basic earnings per share because the Company has not issued any dilutive or potentially dilutive instruments.
The following new and amended standards have not come into effect by the date of the financial statements and will be applied in future periods. The Company will apply the new and revised standards and interpretations when they become effective. The Company did not apply any amended standards or interpretations prior to their effective date.
Amendments to IAS 21 – The Effects of Changes in Foreign Exchange Rates: Lack of Exchangeability Effective for annual reporting periods beginning on or after 1 January 2025. Earlier application is permitted. Under IAS 21 The Effects of Changes in Foreign Exchange Rates, a company uses a spot exchange rate when translating a foreign currency transaction. In some jurisdictions, no spot rate is available because a currency cannot be exchanged into another currency.
IAS 21 was amended to clarify:
Effective for annual reporting periods beginning on or after 1 January 2026. Earlier application is permitted.
There has been diversity in practice over the timing of the recognition and derecognition of financial assets and financial liabilities, particularly when they are settled using an electronic payment system. The amendments to IFRS 9 clarify when a financial asset or a financial liability is recognised and derecognised.
Under the amendments, a company generally derecognises its trade payable on the settlement date. Usually this is the date on which payment is completed.
The amendments also provide an optional exception, which allows the company to derecognise its trade payable earlier than the settlement date, potentially on the date when payment is initiated and cannot be cancelled. The exception is available when the company uses an electronic payment system that meets all of the following criteria:
Companies can choose to apply the exception for electronic payments on a system-by-system basis.
Under IFRS 9, it was unclear whether the contractual cash flows of some financial assets with ESG-linked features represented SPPI, which is a condition for measurement at amortised cost. This could have resulted in financial assets with ESG-linked features being measured at fair value through profit or loss.
The amendments introduce an additional SPPI test for financial assets with contingent features that are not related directly to a change in basic lending risks or costs – e.g. where the cash flows change depending on whether the borrower meets an ESG target specified in the loan contract.
Under the amendments, certain financial assets including those with ESG-linked features could now meet the SPPI criterion, provided that their cash flows are not significantly different from an identical financial asset without such a feature.
The amendments also include additional disclosures for all financial assets and financial liabilities that have certain contingent features that are:
The amendments clarify the key characteristics of CLIs and how they differ from financial assets with non-recourse features. The amendments also include factors that a company needs to consider when assessing the cash flows underlying a financial asset with non-recourse features (the ‘look through’ test).
The amendments require additional disclosures for investments in equity instruments that are measured at fair value with gains or losses presented in other comprehensive income (FVOCI).
The management has assessed the impact of the amendments and believes they will have no significant impact on the Company's financial statements.
Effective for annual reporting periods beginning on or after 1 January 2026. Earlier application is permitted.
The amendments enable nature-dependent electricity contracts, which are sometimes referred to as renewable power purchase agreements (PPAs), to be better reflected in the financial statements. The amendments:
The management has assessed the impact of the amendments and believes they will have no significant impact on the Company's financial statements.
Effective for annual reporting periods beginning on or after 1 January 2027. Earlier application is permitted.
IFRS 18 replaces IAS 1 Presentation of Financial Statements. The major changes in the requirements are summarised below.
IFRS 18 introduces newly defined ‘operating profit’ and ‘profit or loss before financing and income tax’ subtotals and a requirement for all income and expenses to be allocated between three new distinct categories based on a company’s main business activities: operating, investing and financing.
Under IFRS 18, companies are no longer permitted to disclose operating expenses only in the notes. A company presents operating expenses in a way that provides the ‘most useful structured summary’ of its expenses by either:
If any operating expenses are presented by function, then new disclosures apply.
IFRS 18 also requires some ‘non-GAAP’ measures to be reported in the financial statements. It introduces a narrow definition for Management Performance Measures (“MPMs”), requiring them to be:
For each MPM presented, companies need to explain in a single note to the financial statements why the measure provides useful information, how it is calculated and reconcile it to an amount determined under IFRS.
The new standard includes enhanced guidance on how companies group information in the financial statements. This includes guidance on whether information is included in the primary financial statements or is further disaggregated in the notes.
IFRS 18 sets operating profit as a starting point for the indirect method of presenting cash flows from operating activities and eliminates the option for classifying interest and dividend cash flows as operating activities in the cash flow statement (this differs for companies with specified main business activities). It also requires goodwill to be presented as a new line item on the balance sheet.
In its annual financial statements prepared for the period in which the new standard is first applied, an entity shall disclose, for the comparative period immediately preceding that period, a reconciliation for each line item in the statement of profit or loss between:
The management has assessed the impact of the amendments on the Company's financial statements and shall apply them upon enforcement.
Effective for annual reporting periods beginning on or after 1 January 2027. Earlier application is permitted. IFRS 19 allows eligible subsidiaries to apply IFRS Accounting Standards with the reduced disclosure requirements of IFRS 19.
A subsidiary may choose to apply the new standard in its consolidated, separate or individual financial statements provided that, at the reporting date:
A subsidiary applying IFRS 19 is required to clearly state in its explicit and unreserved statement of compliance with IFRS Accounting Standards that IFRS 19 has been adopted.
The management has assessed the impact of the amendments and believes they will have no significant impact on the Company's financial statements.
Effective for annual reporting periods on or after 1 January 2026. Earlier application is permitted. The amendment on derecognition of lease liabilities applies only to lease liabilities extinguished on or after the beginning of the annual reporting period in which the amendment is first applied.
In this volume of improvements, the IASB makes minor amendments to IFRS 9 Financial Instruments and to a further four accounting standards.
The amendments to IFRS 9 address:
The amendments to IFRS 9 require companies to initially measure a trade receivable without a significant financing component at the amount determined by applying IFRS 15. They also clarify that when lease liabilities are derecognised under IFRS 9, the difference between the carrying amount and the consideration paid is recognised in profit or loss.
The management has assessed the impact of the amendments and believes they will have no significant impact on the Company's financial statements.
Effective date deferred indefinitely. Available for optional adoption in full IFRS financial statements. The European Commission decided to defer the endorsement indefinitely, it is unlikely that the EU will endorse it in the foreseeable future.
The amendments clarify that in a transaction involving an associate or joint venture, the extent of gain or loss recognition depends on whether the assets sold or contributed constitute a business, such that:
The management has assessed the impact of the amendments and believes they will have no significant impact on the Company's financial statements.
| € thousand | 2024 | 2023 |
|---|---|---|
| Revenue from contracts with customers (products) | 1,538,576 | 1,449,739 |
| Revenue from contracts with customers (materials) | 216,672 | 214,872 |
| Total revenue from contracts with customers | 1,755,248 | 1,664,611 |
| € thousand | 2024 | 2023 |
|---|---|---|
| Region Slovenia | 71,658 | 66,087 |
| Region South-East Europe | 263,169 | 246,512 |
| Region East Europe | 423,528 |
| € thousand | 2024 | 2023 |
|---|---|---|
| Prescription pharmaceuticals | 1,262,830 | 1,181,580 |
| Non-prescription products | 169,523 | 168,858 |
| Animal health products | 106,223 | 99,301 |
| Total | 1,538,576 | 1,449,739 |
In Ukraine, our third largest market, we sold €96,042 thousand of products in 2024 (2023: €83,392 thousand), representing 6.2% of the Company’s total sales.
In the Russian Federation, which is Krka’s largest market, we have sold €147,358 thousand of products in 2024 (2023: €133,609 thousand), representing 9.6% of the Company’s total sales. The demand for our products is adequate.
Trade receivables are described in Note 17– Trade and other receivables, while liabilities recognised from contracts with customers in Note 25– Current contract liabilities. The Company has not recognised assets from contracts with customers in 2024 and 2023, while liabilities from contracts were recognised in the amount of €2,950 thousand (2023: €5,053 thousand). Recognised assets and liabilities arising from contracts with customers are reported in the statement of financial position.
The Company recognised right-of-return liabilities as accrued bonuses, volume rebates and discounts on products sold to other customers in the amount of €15,162 thousand (2023: €13,900 thousand).
The Company develops, produces, markets and sells human health products (prescription pharmaceuticals, non-prescription products), animal health products, and materials. Revenue from contracts with customers is recognised when control of the goods and services is transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services, while considering specific terms and conditions of an individual contract.
Transfer of control and rewards in the sale of products for human use, veterinary products and material depends on the terms and conditions of an individual contract. Generally, it occurs when the customer accepts the goods in accordance with Incoterms terms. Payment terms vary from region to region (distribution channels), while the standard credit term ranges from 30 to 120 days.
At the year-end, the Company did not incur any costs related to acquiring or fulfilling contracts with customers that could be recognised as asset item.
| € thousand | 2024 | 2023 |
|---|---|---|
| Reversal of non-current provisions | 393 | 0 |
| Reversal of deferred income | 310 | 462 |
| Gains on sale of property, plant and equipment and intangible assets | 995 | 779 |
| Revaluation operating income– leases | 5 | 2 |
| Other operating income | 1,452 | 396 |
| Total other operating income | 3,155 | 1,639 |
Deferred income also includes income from emission coupons obtained free of charge from the State in 2023 and transferred in 2024. See Note 11 – Intangible assets.
| € thousand | 2024 | 2023 |
|---|---|---|
| Cost of goods and materials | 508,477 | 504,285 |
| Cost of services | 345,227 | 339,398 |
| Employee benefits expense | 408,296 | 378,344 |
| Amortisation and depreciation | 71,153 | 80,239 |
| Net write-offs and allowances for inventories | 17,311 | 9,808 |
| Net impairments and write-offs of receivables | –2,124 | –3,960 |
| Formation of provisions for lawsuits | 7,400 | 0 |
| Other operating expenses | 32,444 | 29,539 |
| Total costs | 1,388,184 | 1,337,653 |
| Change in the value of inventories of finished products and work in progress | –5,005 | 16,250 |
| Total | 1,383,179 | 1,353,903 |
The largest items among costs of services refer to marketing and transport services, intellectual and personal services and services related to the maintenance of fixed assets.
More information on depreciation is disclosed in Note 10 – Property, plant and equipment and Note 11 – Intangible assets. Estimated useful lives are disclosed in Note 2 – Significant accounting policies, Property, plant and equipment, and Intangible assets.
| € thousand | 2024 | 2023 |
|---|---|---|
| Gross wages and salaries and continued pay | 314,141 | 293,381 |
| Social security contributions | 20,938 | 21,340 |
| Pension insurance contributions | 41,466 | 37,019 |
| Post-employment benefits and other non-current employee benefits | 10,331 | 7,046 |
| Other employee benefits expense | 21,420 | 19,558 |
| Total employee benefits | 408,296 | 378,344 |
Post-employment benefits and other non-current employee benefits are detailed in Note 22 – Provisions. Other employee benefits include primarily vacation bonuses and commuting allowances.
In 2024, compulsory pension and disability insurance (comprising both the employee’s and the employer’s contribution) payable amounted to €78,171 thousand (2023: €69,015 thousand). Supplementary pension insurance contributions amounted to €11,074 thousand (2023: €10,468 thousand).
| € thousand | 2024 | 2023 |
|---|---|---|
| Grants and assistance for humanitarian and other purposes | 1,873 | 2,901 |
| Environmental protection expenditures | 5,827 | 4,639 |
| Other taxes and levies |
| € thousand | 2024 | 2023 |
|---|---|---|
| Interest income | 10,641 | 9,074 |
| Derivative income | 10,066 | 4,277 |
| – Realised revenue | 1,959 | 4,277 |
| – Fair value change | 8,107 | 0 |
| Income from other financial instruments | 8,983 | 7,245 |
| – Income generated | 9,683 | 3,220 |
| – Fair value change | –700 | 4,025 |
| Income from dividends and other profit shares | 5,268 | 40,354 |
| – Dividends | 760 | 808 |
| – Profits of subsidiaries | 4,508 | 39,546 |
| Other financial income | 9 | 14 |
| Total financial income | 34,967 | 60,964 |
| Net foreign exchange differences | –30,463 | –42,096 |
| Interest expenses | –3,462 | –3,781 |
| – Interest paid | –3,381 | –3,705 |
| – Interest expenses on lease liabilities | –81 | –76 |
| Derivative expenses | –1,696 | –4,782 |
| – Realised expenses | –1,696 | –389 |
| – Fair value change | 0 | –4,393 |
| Other financial expenses | –4,375 | –3,564 |
| Total financial expenses | –39,996 | –54,223 |
Loss on sale and write-offs of property, plant and equipment and intangible assets
€2,925
€1,054
Other operating expenses
€2,756
€2,571
Total other operating expenses
€32,444
€29,539
–5,029
6,741
The net financial result in 2024 was primarily due to a poor result from the net foreign exchange differences lower by €11,770 thousand. The most significant impact came from the rouble exchange rate (closing rate 31 December 2024: €1 = RUB 118.0092; 31 December 2023: €1 = RUB 99.9723).
Most of the interest income is interest received on short-term loans from banks in Slovenia.
In 2024, we continued our policy of partially hedging the US dollar risk with financial instruments.
The income from other financial instruments of €8,983 thousand (2023: €7,245 thousand) represents capital gains on investments in treasury bills.
The income from investments at amortised cost of €109 thousand (2023: €432 thousand) is income from bonds and is shown under interest income. For more information on these investments, see Note 14 – Investments.
Detailed information on the risk of changes in foreign exchange rates can be found in Note 30 – Financial instruments and financial risks.
| € thousand | 2024 | 2023 |
|---|---|---|
| Current income tax | 56,896 | 36,241 |
| Deferred tax | 2,746 | –1,673 |
| Other income tax | 133 | / |
| Top-up tax | 1 | / |
| Total income tax | 59,776 | 34,568 |
| Profit before tax | 380,968 | 329,049 |
| Income tax calculated at the rate of 19% | / | 62,519 |
| Income tax calculated at the rate of 22% | 83,813 | / |
| Tax on non-deductible income | –933 | –7,439 |
| Tax on non-deductible expenses | 3,281 | 3,198 |
| Income tax from tax incentives | –24,902 | –20,328 |
| Tax on expenses/income, which were non-deductible for taxable purposes in the previous years | –1,617 | –1,922 |
| Impact of changed tax rates on deferred taxes | / | –1,460 |
| Other income tax expenses | 133 | / |
| Top-up tax | 1 | / |
| Total income tax expense | 59,776 | 34,568 |
| Effective tax rate | 15.7% | 10.5% |
Investments in R&D and investment incentives represent the major share of tax incentives.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Land | 52,540 | 51,786 |
| Buildings |
| € thousand | Land | Buildings | Equipment | PPE being acquired | Right-of-use assets | Total | |
|---|---|---|---|---|---|---|---|
| Purchase cost | Balance at 1 Jan 2023 | 28,010 | 639,460 | 1,081,458 | 52,107 | 6,772 | 1,807,807 |
| Additions | 0 | 0 | 0 | 102,876 | 0 | 102,876 | |
| Capitalisations– transfer from PPE being acquired | 23,756 | 19,145 | 54,809 | –97,710 | 0 | 0 | |
| Capitalisations– IFRS 16 Leases | 0 | 0 | 0 | 0 | 765 | 765 | |
| Disposals, impairments, deficit, surplus | 20 | –414 | –31,420 | 0 | –69 | –31,883 | |
| Transfers, reclassifications | 0 | 357 | –357 | 0 | 0 | 0 | |
| Balance at 31 Dec 2023 | 51,786 | 658,548 | 1,104,490 |
In 2024, most of the controlling company's investments were earmarked for renovating the Notol packaging plant in the amount of €15,957 thousand (2023: €14,713 thousand), for IT and telecommunications projects in the amount of €12,422 thousand (2023: €9,742 thousand) and for Sinteza 2 in Krško in the amount of €8,359 thousand (2023: €376 thousand). In Notol, €6,641 thousand (2023: €12 thousand) were allocated for upgrading the granulation capacity and €5,662 thousand (2023: €208 thousand) for the modernisation of the logistics system.
| Balance at 1 Jan 2024 | Additions | Capitalisations– transfer from PPE being acquired | Capitalisations– IFRS 16 Leases | Disposals, impairments, deficit, surplus | Transfers, reclassifications | Balance at 31 Dec 2024 | |
|---|---|---|---|---|---|---|---|
| Item 1 | 57,273 | 0 | 754 | 0 | 0 | 0 | 52,540 |
| Item 2 | 7,468 | 0 | 4,823 | 0 | –2,866 | 0 | 660,505 |
| Item 3 | 1,879,565 | 0 | 63,996 | 0 | –34,505 | –9 | 1,133,972 |
| Item 4 | 51,786 | 80,862 | –69,573 | 899 | –1,246 | 0 | 67,316 |
| Item 5 | 658,548 | 0 | 0 | 0 | –497 | 0 | 7,870 |
| Item 6 | 1,104,490 | 0 | 0 | 0 | –39,114 | 0 | 1,922,203 |
| Balance at 1 Jan 2023 | Depreciation | Disposals, impairments, deficit, surplus | Transfers, reclassifications | |
|---|---|---|---|---|
| Item 1 | 0 | 0 | 0 | 0 |
| Item 2 | –395,542 | –20,400 | 398 | –193 |
| Item 3 | –842,587 | –53,064 | 31,074 | 193 |
| Item 4 | 0 | 0 | 0 | 0 |
| Item 5 | –2,898 | –1,064 | 43 | |
| Item 6 | –1,241,027 | –74,528 | 31,515 |
| –415,737 | –864,384 | –3,919 | –1,284,040 | ||
|---|---|---|---|---|---|
| –415,737 | –864,384 | –3,919 | –1,284,040 | ||
|---|---|---|---|---|---|
| –20,561 | –43,882 | –1,097 | –65,540 | ||
|---|---|---|---|---|---|
| 2,639 | 34,014 | 351 | 37,004 | ||
|---|---|---|---|---|---|
| 0 | 1 | 0 | 1 | ||
|---|---|---|---|---|---|
| –433,659 | –874,251 | –4,665 | –1,312,575 | ||
|---|---|---|---|---|---|
| Balance at 1 Jan 2023 | 28,010 | 243,918 | 238,871 | 52,107 | 3,874 | 566,780 |
|---|---|---|---|---|---|---|
| Balance at 31 Dec 2023 | 51,786 | 242,811 | 240,106 | 57,273 | 3,549 | 595,525 |
| Balance at 1 Jan 2024 | 51,786 | 242,811 | 240,106 | 57,273 | 3,549 | 595,525 |
| Balance at 31 Dec 2024 | 52,540 | 226,846 | 259,721 | 67,316 | 3,205 | 609,628 |
The change in depreciation rates in 2024 resulted in a lower depreciation charge for the Company by €10,267 thousand. The effect of the change will continue to be reflected in a lower depreciation charge also in future years. In the period 2025–2029 and beyond, this cost is expected to decrease by an average of €8,204 thousand per year.
In 2023 and 2024, the Company did not carry out any investments that would meet the criteria for allocating borrowing costs.
All property, plant and equipment is free of encumbrances. The status of known future commitments related to the acquisition of property, plant and equipment is disclosed in Note 27 – Contingent liabilities and commitments.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Software | 15,377 | 15,138 |
| Other intangible assets | 7,706 | 7,556 |
| – Long-term deferred operating costs | 150 | 216 |
| – Development-related projects | 4,389 | 4,478 |
| – Emission coupons | 3,167 | 2,862 |
| Intangible assets being acquired | 1,943 | 3,349 |
| Total intangible assets | 25,026 | 26,043 |
The item of 'software' refers primarily to property rights in computer software. The Company recognises emission coupons acquired free of charge from the State and purchased on the market as other intangible assets. In 2024, the Company acquired 34,736 emission coupons, whereof 9,736 were free emission coupons (2023: 9,736) to be transferred to the State in 2025, and 25,000 were purchased on the market at a value of €1,563 thousand. In 2024, it transferred 25,353 emission coupons, whereof 9,736 were acquired free of charge and 15,617 were purchased on the market at the value of €1,257 thousand. The transferred emission coupons were acquired in 2023, and their transfer was carried out using the FIFO method. As at 31 December 2024, the Company had 55,499 emission in the total amount of €3,167 thousand (46,116 emission coupons with a value of €2,862 thousand as at 31 December 2023). The Company transfers more emission coupons during the year than it receives free of charge from the State and is therefore considered a net contributor.
| € thousand | Concessions, trademarks and licences | Other IA | IA being acquired | Total | |
|---|---|---|---|---|---|
| Purchase cost | Balance at 1 Jan 2023 | 90,263 | 29,455 | 3,619 | 123,337 |
| Additions | 0 | 0 | 8,875 | 8,875 | |
| Transfer from IA being acquired | 5,182 | 3,366 | –8,548 | 0 | |
| Disposals, deficit, surplus | –2,650 | –1,932 | –597 | –5,179 | |
| Balance at 31 Dec 2023 | 92,795 | 30,889 | 3,349 | 127,033 | |
| Balance at 1 Jan 2024 | 92,795 | 30,889 | 3,349 | 127,033 | |
| Additions | 0 | 0 | 6,938 |
Transfer from IA being acquired
4,630
3,096
–7,726
0
–26
–2,915
–618
–3,559
9
0
0
9
97,408
31,070
1,943
130,421
–75,929
–22,448
0
–98,377
–4,378
–1,333
0
–5,711
2,650
448
0
3,098
–77,657
–23,333
0
–100,990
–77,657
–23,333
0
–100,990
–4,400
–1,213
0
–5,613
27
1,182
0
1,209
–1
0
0
–1
–82,031
–23,364
0
–105,395
14,334
7,007
3,619
24,960
15,138
7,556
3,349
26,043
15,138
7,556
| € thousand | Investments in subsidiaries | Purchase cost |
|---|---|---|
| Balance at 1 Jan 2023 | 364,754 | |
| Establishment of new companies | 20 | |
| Subsequent payments | 1,982 | |
| Repayment of subsequent payments | –500 | |
| Balance at 31 Dec 2023 | 366,256 | |
| Balance at 1 Jan 2024 | 366,256 | |
| Repayment of subsequent payments | –2,000 | |
| Balance at 31 Dec 2024 | 364,256 |
| Balance at 1 Jan 2023 | Balance at 31 Dec 2023 | Balance at 1 Jan 2024 | Balance at 31 Dec 2024 | |
|---|---|---|---|---|
| –8,991 | –8,991 | –8,991 | –8,991 |
| Balance at 1 Jan 2023 | Balance at 31 Dec 2023 | Balance at 1 Jan 2024 | Balance at 31 Dec 2024 | |
|---|---|---|---|---|
| 355,763 | 357,265 | 357,265 | 355,265 |
The Company reviews whether there are any indications for impairment of investments in subsidiaries at least once a year. The fair value of an investment that may be impaired is determined by applying methods that are most appropriate for an individual investment. The Company concluded that there were no indicators for impairment of investments in subsidiaries.
| € thousand | Ownership share | Share capital | Value of shares in subsidiaries | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|---|---|---|
| KRKA-RUS LLC, Istra, Russian Federation | 100% | 45,432 | 118,916 | 118,916 | |
| TAD Pharma GmbH, Cuxhaven, Germany | 100% | 6,650 | 97,000 | 97,000 | |
| Ningbo Krka Menovo Pharmaceutical Co. Ltd., Ningbo, China | 60% | 63,386 | 37,624 | 37,624 | |
| TERME KRKA, d. o. o., Novo mesto, Slovenia | 100% | 14,753 | 36,416 |
| Company | Location | Percentage | Value 1 | Value 2 | Value 3 |
|---|---|---|---|---|---|
| KRKA-FARMA d.o.o. | Zagreb, Croatia | 100% | 36,416 | ||
| KRKA - POLSKA Sp. z.o.o. | Warsaw, Poland | 100% | 18,983 | 19,738 | 19,738 |
| KRKA FARMA LLC | Istra, Russian Federation | 100% | 6,388 | 15,170 | 15,170 |
| Krka France Eurl | Paris, France | 100% | 10 | 3,162 | 4,662 |
| KRKA Pharma GmbH | Wien, Vienna, Austria | 100% | 37 | 2,344 | 2,344 |
| KRKA Farmacêutica, Unipessoal Lda. | Estoril, Portugal | 100% | 10 | 2,266 | 2,266 |
| KRKA Farmaceutici Milano S.r.l | Milan, Italy | 100% | 10 | 1,350 | 1,350 |
| KRKA-FARMA DOO BEOGRAD | Belgrade, Serbia | 100% | 1 | 1,042 | 1,042 |
| KRKA-FARMA DOOEL Skopje | Skopje, North Macedonia | 100% | 796 | 802 | 802 |
| KRKA Belgium, SA | Brussels, Belgium | 100% | 300 | 376 | 376 |
| KRKA Magyarország Kft. | Budapest, Hungary | 100% | 109 | 184 | 184 |
| 123Acurae Pharma GmbH | Cuxhaven, Germany | 100% | 25 | 25 | 25 |
| KRKA Sverige AB | Stockholm, Sweden | 100% | 13 | 16 | 16 |
| LLC ´KRKA Kazakhstan´ | Almaty, Kazakhstan | 100% | 13 | 11 | 11 |
| KRKA Bulgaria EOOD | Sofia, Bulgaria | 100% | 10 | 10 | 10 |
| KRKA FARMA d.o.o. | Sarajevo, Sarajevo, Bosnia and Herzegovina | 100% | 10 | 10 | 10 |
| KRKA FARMACÉUTICA, S.L. | Madrid, Spain |
| KRKA HELLAS E.P.E., Athens, Greece | 100% | 10 | 10 | 10 |
|---|---|---|---|---|
| KRKA ROMANIA S.R.L., Bucharest, Romania | 100% | 10 | 10 | 10 |
| KRKA Slovensko, s.r.o., Bratislava, Slovakia | 100% | 7 | 10 | 10 |
| SIA KRKA Latvia, Riga, Latvia | 100% | 10 | 10 | 10 |
| UAB KRKA Lietuva, Vilnius, Lithuania | 100% | 10 | 10 | 10 |
| KRKA GCC L.L.C., Dubai, United Arab Emirates | 100% | 9 | 10 | 10 |
| KRKA Netherlands B.V., Breskens, Netherlands | 100% | 10 | 10 | 10 |
| TOV KRKA UKRAINE, Kiev, Ukraine | 100% | 2 | 9 | 9 |
| KRKA USA LLC, Wilmington, USA | 100% | 10 | 8 | 8 |
| KRKA Finland Oy, Espoo, Finland | 100% | 3 | 3 | 503 |
| KRKA ČR, s. r. o., Prague, Czechia | 100% | 4 | 3 | 3 |
| KRKA UK LTD, London, United Kingdom | 100% | 1 | 2 | 2 |
| KRKA PHARMA DUBLIN LIMITED, Dublin, Ireland | 100% | 1 | 1 | 1 |
| Total | 161,124 | 355,265 | 357,265 |
As at 31 December 2024, the subsidiary Terme Krka, d.o.o. had a 100-percent shareholding in Golf Grad Otočec, d.o.o. and the subsidiary KRKA France Eurl had a 100-percent shareholding in HCSbvba in Belgium. The Chinese company Ningbo Menovo Pharmaceutical Co. Ltd is the 40-percent owner of the company Ningbo Krka Menovo Pharmaceutical Co. Ltd.
€ thousand
| Type | 31 Dec 2023 | 31 Dec 2024 |
|---|---|---|
| Loans to subsidiaries | 11,100 | 0 |
| Loans to others | 12,301 | 11,243 |
| Deposits granted to banks | 0 | 30,000 |
| Type | 31 Dec 2023 | 31 Dec 2024 |
|---|---|---|
| Portion of non-current loans maturing next year | 1,897 | 12,827 |
| Loans to subsidiaries | 6,850 | 1,697 |
| Loans to others | 18 | 13 |
| Deposits granted to banks | 0 | 50,000 |
| Current interest receivables | 260 | 1,162 |
| Type | 31 Dec 2023 | 31 Dec 2024 |
|---|---|---|
| Total loans | 32,426 | 106,942 |
As at 31 December 2024, the Company had no deposits with a maturity of more than one year (the deposits’ amount as at 31 December 2023 was €30,000 thousand) and no deposits with a maturity of more than 90 days and less than one year (as at 31 December 2023 the deposits amounted to €50,000 thousand).
The annual rate of interest agreed on conclusion of loan contracts within the Krka Group companies is the rate of interest set by the Minister of Finance of the Republic of Slovenia in accordance with the Corporate Income Tax Act which defines the interest rate for related parties. In 2024, the interest rate was 0.855%.
Non-current loans to other entities comprise loans that are extended to the employees in accordance with internal rules of the Company. These loans are used for the purchase or renovation of housing. In 2024, the interest rate fluctuated between 3.211% and 4.554% (2023: between 4.096% and 5.008%). The maximum repayment period is 15 years.
Loans by maturity, region and currency are outlined in Note 30 – Financial instruments and financial risks.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Non-current loans to subsidiaries | 11,100 | 0 |
| TERME KRKA, d. o. o., Novo mesto, Slovenia | 11,100 | 0 |
| Current loans to subsidiaries inclusive of the non-current part of the loan maturing next year | 6,984 | 12,826 |
| TERME KRKA, d. o. o., Novo mesto, Slovenia | 6,474 | 11,106 |
| UAB KRKA Lietuva, Vilnius, Lithuania | 201 | 0 |
| KRKA HELLAS E.P.E., Athens, Greece | 100 | 100 |
| HCS bvba*, Edegem, Belgium | 89 | 78 |
| TAD Pharma GmbH, Cuxhaven, Germany | 59 | 12 |
| KRKA GCC L.L.C., Dubai, United Arab Emirates | 37 | 36 |
| KRKA Farmaceutici Milano S.r.l., Milan, Italy | 7 | 0 |
| KRKA Finland Oy, Espoo, Finland | 4 | 1,330 |
The repayment period of the non-current loan to Terme Krka was 4 years and 6 months as at 31 December 2024.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Non-current investments | 22,023 | 47,673 |
| – Investments at fair value through OCI (equity instruments) | 22,023 | 26,900 |
| – Investments at amortised cost (debt instruments) | 0 | 20,773 |
| Current investments including derivatives | 249,794 | 306,769 |
| – Investments at fair value through profit or loss | 224,110 | 236,751 |
| – Investments at amortised cost (debt instruments) | 20,231 | 70,018 |
| – Derivatives | 5,453 | 0 |
| Total investments | 271,817 | 354,442 |
Non-current investments at fair value through other comprehensive income comprised €1,136 thousand of investments in shares and interests in companies in Slovenia (2023: €953 thousand) and €20,887 thousand of investments in shares of foreign operations i.e. companies located abroad (2023: €25,947 thousand).
Current investments at amortised cost included investments in foreign government bonds in the amount of €20,231 thousand (2023: €63,985 thousand), while there were no investments in Slovenian government bonds in 2024 (2023: €6,033 thousand). These are bonds with a maturity of less than one year and a credit risk rating corresponding to the globally understood definition of upper medium grade.
Investments at fair value through profit or loss represent investments in treasury bills of EU countries with a high credit rating that meets the globally understood definition of investment grade. 49% of the treasury bill portfolio is of high grade, and 51% belongs to the prime investment grade.
The decrease in investments at amortised cost of €71,136 thousand is due to the maturity of government bonds. The increase in investments at fair value through profit or loss amounting to €465,295 thousand includes acquisitions of treasury bills, and the decrease of €477,236 thousand includes disposals of treasury bills due to their maturity.
| € thousand | Financial assets at fair value through OCI | Investments at amortised cost | Investments at fair value through profit or loss |
|---|---|---|---|
| Balance at 1 Jan 2023 | 15,988 | 145,478 | 0 |
| Increase | 0 |
Increases in financial assets comprise new acquisitions and imputed interest, while decreases comprise coupons received, imputed interest and disposals due to the investments’ maturity. Adjustments of non-current investments at fair value through OCI are recognised in other comprehensive income in the amount of €4,877 thousand in the reporting period (2023: €10,912 thousand). Foreign exchange differences on investments at amortised cost amounting to –€1,235 thousand (2023: –€3,479 thousand) are recognised in financial expenses.
| € thousand | Assets | Liabilities | ||
|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | |
| Investments at fair value through OCI | 1,978 | 1,978 | 4,211 | 5,284 |
| Receivables | 576 | 1,055 | 0 | 0 |
| Dividends | 0 | 1,800 | 0 | 0 |
| Provisions for post-employment benefits and other non-current employee benefits | 7,334 | 8,297 | 0 | 0 |
| Total | 9,888 | 13,130 | 4,211 |
| Balance at 1 Jan 2023 | Recognised in income statement | Recognised in OCI | Balance at 31 Dec 2023 | Recognised in income statement | Recognised in OCI | Balance at 31 Dec 2024 | |
|---|---|---|---|---|---|---|---|
| Investments at fair value through OCI | –782 | 270 | –2,794 | –3,306 | 0 | 1,073 | –2,233 |
| Receivables | 1,687 | –632 | 0 | 1,055 | –479 | 0 | 576 |
| Dividends | 33 | 1,767 | 0 | 1,800 | –1,800 | 0 | 0 |
| Provisions for post-employment benefits and other non-current employee benefits | 7,728 | 268 | 301 | 8,297 | –467 | –496 | 7,334 |
| Total | 8,666 | 1,673 | –2,493 | 7,846 | –2,746 | 577 | 5,677 |
In 2023, deferred taxes were calculated using the revised tax rate, which increased from 19% to 22%. The relevant impact thereof amounted to €1,368 thousand. A 22% tax rate was applied in 2024.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Materials | 252,100 |
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Current trade receivables | 518,425 | 463,126 |
| – Receivables due from subsidiaries | 303,125 | 268,438 |
| – Receivables due from customers other than Krka Group companies | 215,300 | 194,688 |
| Current receivables for other dividends | 0 | 9,837 |
| Current receivables due from others | 13,800 | 37,279 |
| Total receivables | 532,225 | 510,242 |
More than 95% of trade receivables from buyers other than Krka Group companies insured with a credit insurer, by taking into account more than 85% of the deductible (more than 95% of trade receivables from buyers other than Krka Group companies were insured as at 31 December 2023, by taking into account more than 80% of the deductible).
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| KRKA-RUS LLC, Istra, Russian Federation | 108,679 | 106,356 |
| KRKA FARMA LLC, Istra, Russian Federation | 84,773 | 58,515 |
| KRKA Sverige AB, Stockholm, Sweden | 21,744 | 21,500 |
| KRKA - POLSKA, Sp. z o. o., Warsaw, Poland | 14,139 | 11,693 |
| KRKA-FARMA DOO BEOGRAD, Belgrade, Serbia | 12,393 | 11,457 |
| KRKA UK LTD, London, United Kingdom | 11,593 | 10,665 |
| LLC 'KRKA Kazakhstan', Almaty, Kazakhstan | 10,505 | 7,561 |
| KRKA-FARMA DOOEL Skopje, Skopje, North Macedonia | 7,984 | 8,758 |
| KRKA Farmaceutici Milano S.r.l., Milan, Italy | 5,655 | 5,233 |
The increase in inventories is the result of adapting to market conditions. By carefully planning our inventories and safety stocks, we ensure we always have access to the intermediate goods we require to produce our finished products. The planning of inventories of intermediate goods is based on sales forecasts. We also ensure optimal and adequate stocks of finished products throughout the distribution chain.
The net write-offs and value adjustments of inventories are presented within operating expenses and amounted in the reporting period to €17,311 thousand (2023: €9,808 thousand).
| TAD Pharma GmbH, Cuxhaven, Germany | 4,405 | 12,346 |
|---|---|---|
| KRKA Pharma GmbH, Wien, Vienna, Austria | 4,400 | 182 |
| KRKA Belgium, SA, Brussels, Belgium | 3,074 | 2,181 |
| KRKA-FARMA d.o.o., Zagreb, Croatia | 2,858 | 2,282 |
| KRKA Finland Oy, Espoo, Finland | 2,828 | 2,420 |
| Krka FARMACÉUTICA, S.L., Madrid, Spain | 2,068 | 1,037 |
| KRKA Farmacêutica, Unipessoal Lda., Estoril, Portugal | 2,014 | 2,742 |
| Krka France Eurl, Paris, France | 1,465 | 1,162 |
| Ningbo Krka Menovo Pharmaceutical Co. Ltd., Ningbo, China | 1,023 | 817 |
| KRKA Netherlands B.V., Breskens, Netherlands | 510 | 0 |
| 123 Acurae Pharma GmbH, Cuxhaven, Germany | 398 | –4 |
| KRKA UKRAINE LLC, Kiev, Ukraine | 219 | 39 |
| KRKA PHARMA DUBLIN LIMITED, Dublin, Ireland | 197 | 1,163 |
| Receivables due from other Krka Group companies | 201 | 333 |
| Total current trade receivables due from subsidiaries | 303,125 | 268,438 |
| € thousand | Gross value | Allowances for receivables | Net value at 31 Dec 2024 | Net value at 31 Dec 2023 |
|---|---|---|---|---|
| Trade receivables due from domestic customers other than Krka Group companies | 10,973 | 12 | 10,961 | 10,712 |
| Trade receivables due from foreign customers other than Krka Group companies | 234,298 | 28,847 | 205,451 | 184,587 |
| Deferred income from contracts with foreign customers | –1,112 | 0 | –1,112 | –611 |
| Total current trade receivables due from customers other than Krka Group companies | 244,159 | 28,859 | 215,300 | 194,688 |
The net amount of the receivable write-offs and impairment disclosed in operating expenses amounted in 2024 to –€2,124 thousand (2023: –€3,960 thousand). Receivables due from customers and subsidiaries maturity, region and currency are outlined in Note 30 – Financial instruments and financial risks.
Most of current receivables due from others in the total amount of €13,800 thousand (2023: €37,279 thousand) include current deferred costs of €7,223 thousand (2023: €6,167 thousand). No VAT receivables were recorded in 2024 (2023: €21,938 thousand). Advances for services were recorded at €1,873 thousand (2023: €322 thousand).
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Bank balances | 238,183 | 140,993 |
| Total cash and cash equivalents | 238,183 | 140,993 |
Bank balances include a deposit of €204,438 thousand and a maturity of up to 90 days (2023: €118,000 thousand).
The Company's share capital of €54,732 thousand is represented by 32,793,448 ordinary no-par value shares. There is only one class of share. The share capital is fully paid in.
At the 29th Annual General Meeting on 6 July 2023, the Company’s Management Board was granted authorisation to purchase treasury shares. However, the total amount of treasury shares should not exceed 10% of the Company’s share capital, i.e. 3,279,344 shares, whereby the total amount is inclusive of shares already held by the Company as at the date. The authorisation is valid for a period of 36 months from the date of the resolution’s adoption.
The Company is allowed to acquire treasury shares on the regulated securities market at respective market prices at any time. It may also acquire treasury shares outside the regulated securities market. When purchasing treasury shares on the regulated market, the purchase price must not be lower than the book value based on the respective latest publicly published audited financial statements of the Krka Group. Furthermore, the purchase price of the shares must not exceed 25-fold the earnings per share held by the majority stakeholders as calculated based on the latest publicly published audited consolidated income statement of the Krka Group.
Pursuant to paragraphs 3 and 4, Article 381 of the ZGD–1, an entity may reduce the share capital by withdrawing of all treasury shares in a simplified procedure and recognising the amount against other profit reserves.
| No. of shares | Weighted average share price (€) | Value of treasury shares (€ thousand) | |
|---|---|---|---|
| Balance at 31 Dec 2022 | 1,785,849 | 124,566 | |
| Repurchases in 2023 | 130,117 | 107.00 | 13,923 |
| Balance at 31 Dec 2023 | 1,915,966 | 138,489 | |
| Repurchases in 2024 | 191,371 | 130.65 | 25,002 |
| Balance at 31 Dec 2024 | 2,107,337 | 163,491 |
The repurchased treasury shares relate to repurchases that were recorded in individual years. A subscription fee is included in the weighted average price of shares. The amount paid, including commission, is deducted from the total capital as treasury shares until such shares are withdrawn, reissued or sold.
The repurchases of treasury shares in 2024 in terms of days are outlined in Note 34 – Repurchase of treasury shares.
The Company’s reserves comprise reserves for treasury shares, the share premium, legal and statutory reserves, fair value reserves and translation reserves. Reserves for treasury shares amounted as at the balance sheet date to €163,491 thousand and increased by €25,002 thousand based on their formation as a result of additional repurchase of treasury shares.
The share premium is to be used under the terms and purposes as defined by the applicable act. The share premium was recorded at €105,897 thousand as at 31 December 2024 and consisted of the general equity revaluation adjustment of €90,659 thousand that was included in share premium during the transition to IFRS; the share premium of €10,844 thousand formed pursuant to a special regulation applicable in the ownership transformation of the Company; and €4,394 thousand of share premium resulting from reduction in the share capital due to the withdrawal of treasury shares. The amount may be used solely to increase share capital. In 2024, the value of the share premium remained unchanged.
Statutory reserves are available for drawdown. The fair value reserve includes the cumulative change in the fair value of financial assets and post-employment benefits. Compared to the previous year, the fair value reserve decreased by €10,540 thousand and amounted to –€9,435 thousand as at 31 December 2024. The cumulative change is due to a €4,877 thousand increase in the fair value of financial assets through OCI (equity instruments) and a decrease due to the restatement of post-employment benefits of €6,240 thousand and an increase by the impact of deferred taxes of €577 thousand.
Retained earnings grew based on the profit of €321,192 thousand. On the other hand, they declined as a result of the allocation of accumulated profit to dividend payment (€230,933 thousand) in accordance with the resolution adopted by the 30th Annual General Meeting on 11 July 2024; an additional formation of reserves for treasury shares in total of €25,002 thousand on account of the treasury share repurchase and changes in provisions for termination benefits amounting to €1,624 thousand.
The dividend payout reported in the statement of cash flows differs from the figure confirmed by the Annual General Meeting and reported in the statement of changes in equity by –€49 thousand (2023: €1 thousand).
In 2024, the declared gross dividend per share was €7.50 (2023: €6.60).
The table below is presented in €, unlike all other tables in the financial report hereof, where data is expressed in € thousand.
| 2024 | 2023 | |
|---|---|---|
| Compulsory appropriation of profit | ||
| Net profit | 321,192,246.57 | 294,481,380.06 |
| – To cover the loss from previous periods | 0.00 | 0.00 |
| – Allocation to legal reserves | 0.00 | 0.00 |
| – Allocation to reserves for treasury shares | –25,002,075.07 | –13,922,553.48 |
| – Allocation to statutory reserves | 0.00 | 0.00 |
| Profit after compulsory appropriation | 296,190,171.50 | 280,558,826.58 |
| – Formation of other profit reserves under the resolution of the Management and Supervisory Boards | 0.00 | 0.00 |
| Surplus of profit | 296,190,171.50 | 280,558,826.58 |
| Identification of distributable profit | ||
| – Surplus of profit | 296,190,171.50 | 280,558,826.58 |
| – Profit brought forward | 73,878,644.98 | 101,381,119.42 |
| Distributable profit | 370,068,816.48 | 381,939,946.00 |
Basic earnings per share amounted to €10.43 in 2024, showing an increase of 10% over the previous year, when it amounted to €9.51. The calculation of earnings per share took into account the net profit in the amount of €321,192 thousand (2023: €294,481 thousand). The weighted average number of shares was accounted for in the calculation for both years, i.e. 30,783,449 shares for 2024 and 30,954,055 shares for 2023. The average number of shares is calculated from the daily share balances during the year, less treasury shares. Diluted earnings per share equal the basic earnings per share as the Company has not issued any dilutive or contingently dilutive instruments.
| € thousand | 31 Dec 2024 | 31 Dec 2023 | |
|---|---|---|---|
| Current borrowings | 17,805 | 88,061 | |
| – Borrowings from subsidiaries | 17,564 | 87,655 | |
| – Current interest payable |
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Current borrowings from subsidiaries | 17,805 | 88,061 |
| KRKA Pharma GmbH, Wien, Vienna, Austria | 6,129 | 1,382 |
| TAD Pharma GmbH, Cuxhaven, Germany | 5,530 | 85,603 |
| KRKA Belgium, SA, Brussels, Belgium | 2,338 | 208 |
| KRKA Netherlands B.V., Breskens, Netherlands | 2,214 | 0 |
| KRKA FARMACÉUTICA, S.L., Madrid, Spain | 898 | 463 |
| Krka France Eurl, Paris, France | 668 | 5 |
| KRKA Sverige AB, Stockholm, Sweden | 8 | 10 |
| KRKA Finland Oy, Espoo, Finland | 6 | 0 |
| KRKA Farmacêutica, Unipessoal Lda., Estoril, Portugal | 4 | 3 |
| KRKA PHARMA DUBLIN LIMITED, Dublin, Ireland | 4 | 0 |
| TERME KRKA, d. o. o., Novo mesto, Slovenia | 3 | 264 |
| KRKA Farmaceutici Milano S.r.l., Milan, Italy | 2 | 0 |
| 123 Acurae Pharma GmbH, Cuxhaven, Germany | 1 | 123 |
| Total | 17,805 | 88,061 |
Current loans received from subsidiaries represent daily automatic cash pooling.
| € thousand | Balance at 31 Dec 2023 | Formation | Utilisation | Reversal | Balance at 31 Dec 2024 |
|---|---|---|---|---|---|
| Provisions for lawsuits | 10,543 | 7,400 | –10,150 | –393 | 7,400 |
| Provisions for post-employment benefits | 85,564 | 19,957 | –6,117 | –889 | 98,515 |
| Provisions for other non-current employee benefits | 17,892 | 3,612 |
| Movement of provisions in 2023 | € thousand |
|---|---|
| Balance at 31 Dec 2022 | 96,608 |
| Formation | 23,310 |
| Utilisation | –5,176 |
| Reversal | –743 |
| Total provisions | 113,999 |
The provisions for lawsuits referring to intellectual property are determined based on the noted amount of the indemnification claim or, if the claim has not yet been disclosed, on the estimated amount. Legal experts handling intellectual property disputes are engaged to determine the estimated amounts. Additionally, management reviews the calculated provisions for each unresolved claim annually.
In 2014, the European Commission found that Krka had infringed Article 101 of the Treaty on the Functioning of the EU, thereby distorting competition on the EU market for perindopril, and imposed a fine of €10,000 thousand on Krka. Krka paid the fine within the time limit set by the Commission. However, as it considered that its conduct did not infringe competition law rules, it brought an action against the decision before the EU General Court, which ruled in favour of Krka in December 2018.
The Commission has appealed the decision of the General Court of the EU to the European Court of Justice (ECJ) and Krka has formed a long-term provision of €10,000 thousand in December 2022.
In June 2024, the European Court of Justice ruled on the Commission's appeal against the decision of the General Court of the EU. The appeal was upheld, and the case was referred back to the EU General Court. Krka paid a fine of €10,000 thousand pursuant to the decision by using the provision it had established for this purpose.
The total amount of provisions recognised for lawsuits in 2024 amounts to €7,400 thousand, the most significant of which is a provision for a claim for damages in connection with the sale of perindopril in the amount of €6,000 thousand. The Company, along with other generic pharmaceutical companies, is engaged in litigation concerning potential damages resulting from an identified infringement of competition rules. The Company is exposed for €1,400 thousand in relation to the sale of rivaroxaban in Slovakia for a short period in early 2021 when the patent situation in that country was unclear.
Provisions for obligations to employees arising from post-employment and other non-current benefits are based on actuarial calculation using the following assumptions:
| € thousand | 2024 | 2023 |
|---|---|---|
| Balance at 1 Jan | 85,564 | 70,898 |
| Current service costs (CSC) |
| € thousand | Balance at 31 Dec 2023 | New deferred income received | Reversal of deferred income | Balance at 31 Dec 2024 |
|---|---|---|---|---|
| Grants received from the European Regional Development Fund and the budget of the Republic of Slovenia intended for the production of pharmaceuticals in the new Notol 2 Plant | 687 | 0 | –115 | 572 |
| Subsidy for acquisition of electric drive vehicles | 1 | 0 | 0 | 1 |
| Property, plant and equipment received free of charge | 10 | 0 | –3 | 7 |
| Emission coupons | 10 | 10 | –10 | 10 |
| Subsidy for the purchase of joinery | 90 | 0 | –2 | 88 |
| Subsidy for acquisition of other equipment |
| 1,567 | 0 | –160 | 1,407 | |
|---|---|---|---|---|
| Subsidy for upgrading the trucks | 0 | 7 | –1 | 6 |
| Subsidy for electricity production from renewable energy installations | 0 | 512 | –18 | 494 |
| Total deferred income | 2,366 | 529 | –310 | 2,585 |
The production of pharmaceuticals in the new Notol 2 Plant and Farma GRS projects is partly funded by the EU through the European Regional Development Fund. The Notol project is delivered within the framework of the Operational Programme ‘Strengthening Regional Development Potentials’ for the period 2007-2013, Priority axis 1: Competitiveness and Research Excellence: main type of activity 1.1.: Improvement of Competitiveness and Research Excellence. The Farma GRS project was eligible for co-financing of costs under R&D projects, including project management and investments in R&D and production activities.
The amounts of deferred income are decreased by the proportionate share of depreciation of assets to which the grants refer and by any other types of realised expenses.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Current trade payables | 171,183 | 175,847 |
| Payables to subsidiaries | 55,307 | 53,490 |
| Payables to domestic suppliers | 46,859 | 53,639 |
| Payables to foreign suppliers | 69,017 | 68,718 |
| Total trade payables | 171,183 | 175,847 |
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| KRKA-FARMAd.o.o., Zagreb, Croatia | 9,150 | 6,975 |
| KRKA FARMA LLC, Istra, Russian Federation | 8,601 | 9,091 |
| KRKA - POLSKA, Sp. z o. o., Warsaw, Poland | 6,047 | 5,702 |
| KRKA ROMANIA S.R.L., Bucharest, Romania | 5,301 | 4,874 |
| KRKA-RUS LLC, Istra, Russian Federation | 3,992 | 3,893 |
| KRKA Magyarország Kft., Budapest, Hungary | 3,881 | 3,378 |
| KRKA UKRAINE LLC, Kiev, Ukraine | 3,338 | 3,536 |
| KRKA ČR, s. r. o., Prague, Czechia | 2,798 |
| Company | Location | Amount |
|---|---|---|
| KRKA Slovensko, s.r.o. | Bratislava, Slovakia | 2,922 |
| TAD Pharma GmbH | Cuxhaven, Germany | 2,638 |
| KRKA Bulgaria EOOD | Sofia, Bulgaria | 2,332 |
| UAB KRKA Lietuva | Vilnius, Lithuania | 1,253 |
| KRKA-FARMA DOO BEOGRAD | Belgrade, Serbia | 1,195 |
| SIA KRKA Latvia | Riga, Latvia | 1,069 |
| KRKA Farmaceutici Milano S.r.l. | Milan, Italy | 803 |
| LLC 'KRKA Kazakhstan' | Almaty, Kazakhstan | 846 |
| KRKA Sverige AB | Stockholm, Sweden | 605 |
| KRKA Farmacêutica, Unipessoal Lda. | Estoril, Portugal | 590 |
| KRKA HELLAS E.P.E. | Athens, Greece | 459 |
| KRKA-FARMA DOOEL Skopje | Skopje, North Macedonia | 392 |
| Krka France Eurl | Paris, France | 327 |
| KRKA Belgium, SA | Brussels, Belgium | 624 |
| Krka FARMACÉUTICA, S.L. | Madrid, Spain | 232 |
| KRKA Finland Oy | Espoo, Finland | 196 |
| KRKA UK LTD | London, United Kingdom | 219 |
| KRKA Pharma GmbH | Wien, Vienna, Austria | 178 |
| HCS bvba | Edegem, Belgium* | 97 |
| KRKA PHARMA DUBLIN LIMITED | Dublin, Ireland | 85 |
| KRKA FARMA d.o.o. | Sarajevo, Bosnia and Herzegovina | 18 |
| TERME KRKA, d. o. o. | Novo mesto, Slovenia | 61 |
| 123Acurae Pharma GmbH | Cuxhaven, Germany | 56 |
| Ningbo Krka Menovo Pharmaceutical Co. Ltd. | Ningbo, China | 43 |
| KRKA GCC L.L.C. | Dubai, United Arab Emirates | 10 |
| KRKA USA LLC | Wilmington, USA | 7 |
| Total payables to subsidiaries | 55,307 |
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Refund liabilities | 15,162 | 13,900 |
| – Bonuses and volume rebates | 15,162 | 13,900 |
| Contract liabilities | 2,950 | 5,053 |
| – Contract liabilities – advances from other customers | 2,950 | 5,053 |
| Total current contract liabilities | 18,112 | 18,953 |
Accrued bonuses and volume discounts include discounts to which the customers are entitled when the relevant terms and conditions are fulfilled; these discounts are not granted to customers in the year of the sale. Bonuses and volume rebates reduce revenue (generated sales) in the year they pertain to.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Payables to employees – gross salaries, other receipts and charges | 75,684 | 72,498 |
| Derivatives | 0 | 2,653 |
| Other | 3,426 | 2,649 |
| Total other current liabilities | 79,110 | 77,800 |
The item ‘Other’ also includes current liabilities to the State on account of VAT payable in the amount of €795 thousand (2023: €1,317 thousand).
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Guarantees issued | 15,193 | 15,238 |
| Other | 819 | 1,417 |
| Total contingent liabilities | 16,012 | 16,655 |
Among the guarantees issued, the largest items are the performance guarantee for the supply of products awarded in tenders in Italy, amounting to €12,000 thousand, and the guarantee for the TAD Pharma credit line, amounting to €3,000 thousand. Both guarantees are valid until cancelled.
Based on signed contracts related to ongoing investments, the balance of the Company’s commitments for acquiring property, plant and equipment amounted at year-end 2024 to €74,878 thousand (2023: €67,391 thousand).
The Company concludes lease agreements for various assets such as land, parking spaces, offices, apartments, warehouses, and equipment.
The lease terms are assessed according to the type of lease:
The Company does not sub-lease the leased assets.
The Company concluded lease contracts for various production and non-production equipment, temporary offices, and parking spaces, with lease terms shorter than one year. With respect to those leases, the Company applied the practical expedient provided by the Standard.
| € thousand | Carrying amounts of lease liabilities under interest-bearing loans and borrowings and movements during the period |
|---|---|
| Balance at 1 Jan 2023 |
| Balance at 31 Dec 2023 | 3,942 |
|---|---|
| Increase/Decrease | 694 |
| Interest | 76 |
| Lease payments | –1,125 |
| Balance at 31 Dec 2023 | 3,587 |
| – Current lease liabilities | 1,022 |
| – Non-current lease liabilities | 2,565 |
| Balance at 1 Jan 2024 | 3,587 |
| Increase/Decrease | 796 |
| Interest | 81 |
| Lease payments | –1,165 |
| Balance at 31 Dec 2024 | 3,299 |
| – Current lease liabilities | 1,118 |
| – Non-current lease liabilities | 2,181 |
The maturity analysis of lease liabilities is disclosed in Note 30 – Financial instruments and financial risks.
| € thousand | 2024 | 2023 |
|---|---|---|
| Depreciation of right-of-use assets | 1,097 | 1,064 |
| Interest expenses on lease liabilities | 81 | 76 |
| Expenses relating to current leases | 74 | 81 |
| Expenses relating to leases of low-value assets | 2 | 7 |
| Total amount recognised in income statement | 1,254 | 1,228 |
| € thousand | Balance at 31 Dec 2023 | Monetary changes | Non-monetary changes | Balance at 31 Dec 2024 | Additions/disposals other |
|---|---|---|---|---|---|
| Borrowings | 87,655 | –70,109 | 0 | 18 | 17,564 |
| Interest on borrowings | 406 | –3,704 | 3,539 | 0 | 241 |
| Dividends | 1,301 | –230,884 | 230,933 | 0 | 1,350 |
| Leases | 3,587 | –1,165 | 796 |
| € thousand | Balance at 31 Dec 2022 | Monetary changes | Non-monetary changes | Additions/disposals | Balance at 31 Dec 2023 |
|---|---|---|---|---|---|
| Borrowings | 53,375 | 34,290 | 0 | –10 | 87,655 |
| Interest on borrowings | 149 | –3,022 | 3,279 | 0 | 406 |
| Dividends | 1,303 | –204,379 | 204,377 | 0 | 1,301 |
| Leases | 3,942 | –1,125 | 694 | 76 | 3,587 |
| Total | 58,769 | –174,236 | 208,350 | 66 | 92,949 |
The Company's key credit risk arises from trade receivables. This is the risk of customers failing to settle their liabilities by maturity dates.
The Krka Group introduced a centralised credit control process in 2004. The system includes all customers with credit limits exceeding €20,000. Receivables due from small customers accounted for less than 5% of total trade receivables. Control over small customers is decentralised in the sales network and under the constant supervision of the controlling company.
Credit control is a two-step process. The first step involves assessing the credit risk for each customer, determining risk mitigation instruments, and assigning relevant credit limits. We assess each new customer and review the credit ratings of all customers twice a year. Each credit rating includes many different financial and non-financial indicators, which fall into four categories (an assessment of the buyer’s profitability, payment habits and payment discipline, an assessment of the buyer’s financial statements, a qualitative assessment of the sales staff, an assessment of country risk) each of which carries a different weight in the final assessment.
Each customer is allocated a customised credit limit based on their credit rating, anticipated shipment, and payment patterns.
The second step in the credit-control process involves regular dynamic monitoring of a customer’s payment discipline. The information systems of the Company and other subsidiaries engaged in sales monitor available limits and overdue receivables. Control is exercised for each shipment of products to customers. A shipment is automatically blocked if a customer is in arrears or if receivables together with the new shipment exceed the approved credit limit. Sales personnel are required to initiate a payment collection procedure or arrange hedging for the outstanding settlements.
Internal rules determine the process of credit control and authorisations for granting credit limits to customers. Credit control also avails of a system of regular reporting on trade receivables and the customer’s payment discipline. The reporting system aids the early detection of customers at increased risk of defaulting on payments and facilitates effective credit risk management.
The credit control process employs uniform rules which apply to all customers and is regularly adjusted to changes in the sales markets.
Credit control guarantees permanent control over the quality of the trade receivables portfolio. The result is a low share of receivable write-offs and impairments in view of the Company’s sales.
customers and sales markets. Additionally, the majority of outstanding receivables are from long-standing customers with whom Krka has been doing business for several years.
In 2024, we continued activities to manage trade receivables, with a particular focus on the management of receivables in challenging markets. The credit risk management result in 2024 was favourable. At the end of the year, the value of trade receivables was 11% higher than at the beginning of the year, while the amount of overdue and unpaid receivables remained within a range acceptable to Krka.
The carrying amount of financial assets, which were mostly exposed to credit risk, was as follows at the reporting date:
| € thousand | Notes | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|---|
| Loans | 13 | 32,426 | 106,942 |
| Investments at fair value through profit or loss | 14 | 224,110 | 236,751 |
| Investments at amortised cost (debt instruments) | 14 | 20,231 | 90,791 |
| Trade receivables including those due from subsidiaries | 17 | 518,425 | 463,126 |
| Cash and cash equivalents | 18 | 238,183 | 140,993 |
| Total | 1,033,375 | 1,038,603 |
As for the financial assets exposed to credit risk, the loans, investments, trade receivables and receivables due from subsidiaries, as well as cash and cash equivalents are presented separately.
Loans granted include loans granted to subsidiaries and housing loans granted to employees.
Investments at fair value through profit or loss represent investments in treasury bills issued by Western European EU Member States and EU-issued treasury bills with a high credit rating (P-1 by Moody's).
Investments at amortised cost (debt instruments) represent an investment in a bond of an EU Member State with less than half a year to maturity at 31 December 2024. It is classified as a low credit risk financial instrument because its credit risk rating is equivalent to the globally understood definition of investment grade with a rating of A3 by Moody's and A– by S&P Global Ratings.
The Company's cash and cash equivalents consist of bank balances and deposits with a maturity of less than 90 days, held at EU banks with a high credit rating (P-1 by Moody's).
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Region Slovenia | 31,643 | 54,960 |
| Region South-East Europe | 100 | 100 |
| Region East Europe | 147 | 65 |
| Region Central Europe | 201 | 115 |
| Region West Europe | 298 | 51,666 |
| Region Overseas Markets | 37 | 36 |
| Total | 32,426 | 106,942 |
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Region Slovenia | 11,020 | 10,774 |
| Region South-East Europe | 104,761 |
| € thousand | Gross value at 31 Dec 2024 | Allowance at 31 Dec 2024 | Gross value at 31 Dec 2023 | Allowance at 31 Dec 2023 |
|---|---|---|---|---|
| Not past due | 32,388 | 0 | 106,935 | 0 |
| Past due up to 20 days | 24 | 0 | 0 | 0 |
| Past due from 21 to 50 days | 1 | 0 | 2 | 0 |
| Past due from 51 to 180 days | 7 | 0 | 1 | 0 |
| Past due more than 180 days | 6 | 0 | 4 | 0 |
| Total | 32,426 | 0 | 106,942 | 0 |
| € thousand | Gross value at 31 Dec 2024 | Allowance at 31 Dec 2024 | Net value at 31 Dec 2024 | Gross value at 31 Dec 2023 | Allowance at 31 Dec 2023 | Net value at 31 Dec 2023 |
|---|---|---|---|---|---|---|
| Not past due | 492,541 | 238 | 492,303 | 436,088 | 207 | 435,881 |
| Past due up to 20 days | 13,087 | 29 |
| Past due from 21 to 50 days | 9,359 | 44 | 9,315 | 8,893 | 78 | 8,815 |
|---|---|---|---|---|---|---|
| Past due from 51 to 180 days | 3,047 | 41 | 3,006 | 2,155 | 58 | 2,097 |
| Past due more than 180 days | 29,250 | 28,507 | 743 | 31,256 | 30,636 | 620 |
| Total | 547,284 | 28,859 | 518,425 | 494,138 | 31,012 | 463,126 |
The Company is extending payment deadlines to certain customers. If the payment terms were not extended, the receivable maturity structure would be as follows at the reporting date: not past due €489,513 thousand (2023: €430,348 thousand); past due up to 20 days €12,383 thousand (2023: €16,363 thousand); past due between 21 and 50 days €12,780 thousand (2023: €13,698 thousand); past due between 51 and 180 days €3,007 thousand (2023: €2,096 thousand); and past due more than 180 days €743 thousand (2023: €620 thousand).
| € thousand | Gross value at 31 Dec 2024 | Allowance at 31 Dec 2024 | Net value at 31 Dec 2024 | Gross value at 31 Dec 2023 | Allowance at 31 Dec 2023 | Net value at 31 Dec 2023 |
|---|---|---|---|---|---|---|
| Not past due | 14 | 0 | 14 | 0 | 0 | 0 |
| Total | 14 | 0 | 14 | 0 | 0 | 0 |
| € thousand | 2024 | 2023 |
|---|---|---|
| Balance at 1 Jan | 31,012 | 35,441 |
| Formation of allowances | 99 | 320 |
| Write-off of receivables | –94 | –384 |
| Impairment reversal | –2,146 | –3,869 |
–12
–496
Balance at 31 Dec
28,859
31,012
Business partners value Krka for its excellent financial discipline and stable cash flows. In 2024, we settled all financial liabilities regularly, and the Company’s exposure to liquidity risk was low.
The Company has agreements with two banks for the allowed negative balance on transaction accounts for a total amount of €11,125 thousand (in 2023, the Company had agreements with two banks for a total amount of €10,050 thousand). There were no negative balances on transaction accounts at 31 December 2024, so the bank overdraft remained fully unused.
As at 31 December 2024, the Company had an undrawn credit facility of €20,000 thousand (2023: €20,000 thousand as well).
At the end of 2024, Krka recorded cash and cash equivalents primarily as cash at bank or short-term deposits with a 90-day maturity with first-class commercial banks. Other current liquid assets were held in short-term treasury bills issued by Western European countries with first-class credit ratings.
In 2024, the world’s major central banks began lowering key interest rates. The Company recorded favourable returns on cash, cash equivalents, and low-risk liquid investments, reflected in higher interest income and income from other financial instruments.
The Company oversees liquid assets in line with internal investment diversification rules, taking into account factors such as interest rate, liquidity, credit, and currency risks.
The Company manages liquidity risk centrally for the entire Krka Group. Subsidiaries are financed through intra-group loans and any potential cash surpluses are deposited with the controlling company. Excess cash from all Krka Group companies is transferred to the controlling company’s master account either automatically daily (cash pooling) or manually through individual bank transfers. This allows for cash management optimisation, currency risk mitigation, an overview of the liquidity of all Krka Group companies, and enhanced security of cash transactions.
The Company's liquidity ratios remain favourable and stable at the end of 2024.
Liabilities in terms of maturity are outlined in the tables below.
| € thousand | Carrying amount | Contractual cash flows | Total | Up to 6 months | 6–12 months | 1–2 years | 2–5 years | 5–10 years |
|---|---|---|---|---|---|---|---|---|
| Current borrowings | 17,805 | 17,805 | 17,805 | 0 | 0 | 0 | 0 | |
| Lease liabilities | 3,299 | 3,469 | 610 | 589 | 1,037 | 1,173 | 60 | |
| Trade payables excluding advances | 171,183 | 171,183 | 171,183 | 0 | 0 | 0 | 0 | |
| Contract liabilities excluding advances | 15,162 | 15,162 | 15,162 | 0 | 0 | 0 | 0 | |
| Other liabilities excluding amounts owed to the State, to employees and advances | 2,631 |
| € thousand | Carrying amount | Contractual cash flows | Total | Up to 6 months | 6–12 months | 1–2 years | 2–5 years | 5–10 years |
|---|---|---|---|---|---|---|---|---|
| Current borrowings | 88,061 | 88,061 | 88,061 | 0 | 0 | 0 | 0 | |
| Lease liabilities | 3,587 | 3,752 | 550 | 547 | 980 | 1,620 | 55 | |
| Trade payables excluding advances | 175,847 | 175,847 | 175,847 | 0 | 0 | 0 | 0 | |
| Contract liabilities excluding advances | 13,900 | 13,900 | 13,900 | 0 | 0 | 0 | 0 | |
| Other liabilities excluding amounts owed to the State, to employees and advances | 1,333 | 1,333 | 1,333 | 0 | 0 | 0 | 0 | |
| Derivatives | 2,653 | 2,653 | 2,653 | 0 | 0 | 0 | 0 | |
| Total liabilities | 285,381 | 285,546 | 282,344 | 547 | 980 |
The Company operates in diverse international environments and is exposed to foreign exchange risk in certain sales and purchase markets.
Currency exposure arises from the difference in the value of assets and liabilities in a particular currency in the Company’s financial position statement and from differences between operating income and expenses generated in individual currencies.
The key accounting categories composing a currency position are trade receivables, trade payables, liquid financial assets in foreign currencies, derivatives for currency risk hedging, financing of subsidiaries provided by the Company and recorded purchase orders.
The value of the rouble in euro terms depreciated by 15.3% from the beginning to the end of 2024 and is, on average, 7.9% lower than in 2023.
The value of the US dollar denominated in euro increased by 6.4% from the beginning to the end of 2024, while the average value was about the same as in the previous year. The impact of the change in the value of the US dollar on Krka Group's result was neutralised by the use of financial instruments.
The military conflict and the uncertainty about the future economic landscape in Ukraine continued to affect the movement of the Ukrainian hryvnia in 2024.
The value of the Polish zloty was fairly stable in 2024, with the EUR/PLN exchange rate fluctuating between 4.25 and 4.35. From the beginning to the end of 2024, the Polish zloty appreciated by 1.5%, while the average value was 5.5% higher than in 2023.
The Romanian leu and the Czech koruna were also very stable in 2024. The Hungarian forint has depreciated, mainly due to uncertainty about economic growth.
The Company generally mitigates currency risks by natural hedging, primarily by increasing purchases and liabilities in currencies in which sales invoices are issued. When this is impossible, we use derivatives or do not hedge the risk. Generally, only forward contracts are used for hedging.
In 2024, we also hedged against the US dollar risk with financial instruments. The Russian rouble risk was hedged solely by natural methods, as there were no suitable financial instruments on the banking market. The rouble's depreciation against the euro resulted in negative net exchange rate differences.
The increasing exposure from operations and the interest rate differential between the euro and the US dollar, which is favourable for Krka, are the key reasons to hedge the US dollar exposure with financial instruments also in 2024. The impact of the instruments used to hedge the short US dollar position on Krka's net financial result was positive due to the appreciation of the US dollar against the euro.
| € thousand | 31 Dec 2024 | EUR | RUB | PLN | USD | RON |
|---|---|---|---|---|---|---|
| Loans | 32,405 | 0 | 0 | 21 | 0 | |
| Trade receivables | 153,223 | 205,290 | 58,127 | 16,430 | 59,066 | |
| Cash and cash equivalents | 211,413 | 29 | 1,879 | 19,236 | 2,003 | |
| Borrowings | –16,516 | 0 | 0 | –1,289 | 0 | |
| Current trade payables | –140,456 | –3,479 | –6,219 | –7,839 | –5,301 | |
| Financial position exposure (net) | 240,069 | 201,840 | 53,787 | 26,559 | 55,769 |
| € thousand | EUR | RUB | PLN | USD | RON |
|---|---|---|---|---|---|
| Loans | 106,942 | 0 | 0 | 0 | 0 |
| Trade receivables | 146,120 | 178,631 | 53,995 | 10,485 | 52,899 |
| Cash and cash equivalents | 128,027 | 8 | 317 | 5,417 | 2,743 |
| Borrowings | –88,059 | 0 | 0 | –2 | 0 |
| Current trade payables | –142,611 | –3,276 | –5,858 | –11,643 | –4,848 |
| Financial position exposure (net) | 150,420 | 175,363 | 48,454 | 4,257 | 50,794 |
| Currency | Average exchange rate* | Final exchange rate* | 2024 | 2023 |
|---|---|---|---|---|
| RUB | 100.44 | 118.01 | 92.49 | 99.97 |
| PLN | 4.31 | 4.28 | 4.54 | 4.34 |
| USD | 1.08 | 1.04 | 1.08 | 1.11 |
| RON | 4.97 | 4.97 | 4.95 | 4.98 |
The above-stated exchange rates were used to calculate items in the financial statements as at 31 December and equal the reference exchange rates of the ECB effective on the last day of the year. Since the end of March 2022, the Bloomberg exchange rate is used to convert the Russian rouble.
| 2024 | 2023 | |||
|---|---|---|---|---|
| Currency fluctuations for | +1% | –1% | +1% | –1% |
| RUB | 2,018 | –2,018 | 1,754 | –1,754 |
| PLN | 538 | –538 | 485 | –485 |
| USD | 266 | –266 | 43 | –43 |
| RON | 558 | –558 | 508 | –508 |
Any additional 1% increase/decrease in the euro exchange rate relative to the aforementioned currencies would result in a corresponding increase or decrease in the profit or loss before tax by the amounts stated above.
Interest rate risk is defined as the risk that the Company will experience an increase in the cost of long–term funding or a decrease in income from non-current investments as a result of changes in reference market interest rates.
The interest rate risk with current borrowings and current investments is managed as part of the Krka Group’s liquidity risk. In 2024, the Company raised non-current borrowings only from subsidiaries.
| € thousand | 31 Dec 2024 | 31 Dec 2023 | |
|---|---|---|---|
| Financial instruments at a fixed rate of interest | 230,177 | 192,411 | |
| Financial assets | 230,177 | 192,411 | |
| Financial instruments at a variable rate of interest | –11,137 | –56,286 | |
| Financial assets | 6,427 | 31,369 | |
| Financial liabilities | –17,564 | –87,655 |
A 100 basis-point increase in the variable interest rate for 2024 would decrease the profit or loss by €111 thousand (a decrease in the interest rate by 100 basis points would increase the profit or loss by €111 thousand). An increase of 100 basis points in the variable interest rate would decrease the 2023 profit or loss by €563 thousand (a decrease of the interest rate by 100 basis points would increase the profit or loss by €563 thousand). The analysis, conducted consistently for both years, assumes that all variables, especially the exchange rate, remain unchanged.
| Current borrowings | € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|---|
| Current borrowings inclusive of current portion of non-current borrowings | 17,564 | 87,655 | |
| – Other borrowings | 17,564 | 87,655 | |
| Current borrowings exclusive of current portion of non-current borrowings | 17,564 | 87,655 | |
| Average balance of current borrowings | 52,610 | 70,515 | |
| Interest paid in the financial year | 3,379 | 3,699 |
6.42%
5.25%
| – € | 93% |
|---|---|
| – $ | 7% |
| – Variable | 100% |
|---|---|
The primary objective of managing the Company’s capital is to ensure a high credit rating and adequate funding ratios so that the Krka Group can adequately develop its business and maximise value for its shareholders.
By managing and adjusting its equity structure, the Company keeps pace with changes in the economic environment.
Dividends are paid once a year in line with the strategic policy adopted. The Company has no specific employee ownership targets or share option plan.
The Company’s approach to capital management did not change in 2024 or 2023.
The Company monitors capital using a gearing ratio, calculated as net debt divided by the sum of net debt and total equity.
Within net debt, the Company includes interest-bearing borrowings, operating liabilities, current liabilities from contracts with customers and other current payables less cash and cash equivalents.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Current borrowings | 17,805 | 88,061 |
| Operating liabilities | 171,183 | 175,847 |
| Current liabilities from contracts with customers | 18,112 | 18,953 |
| Other current payables | 79,110 | 77,800 |
| Cash and cash equivalents | 238,183 | 140,993 |
| Net indebtedness | 48,027 | 219,668 |
| Equity | 2,186,351 | 2,133,258 |
| Equity and net indebtedness | 2,234,378 | 2,352,926 |
| Financial leverage (debt/equity) ratio | 2.1% | 9.3% |
The following table shows the carrying amounts and fair values of financial assets and financial liabilities. The table does not include disclosures about the fair values of financial assets and liabilities not measured at fair value, where the carrying amount is a reasonable approximation of fair value.
| € thousand | 31 Dec 2024 | Fair value | 31 Dec 2023 | Fair value |
|---|---|---|---|---|
| Non-current financial assets | Loans | 23,401 | 41,243 | |
| Investments at fair value through OCI (equity instruments) | 22,023 | 22,023 | 26,900 | 26,900 |
| Investments at amortised cost (debt instruments) | 0 | 20,773 | ||
| Current financial assets |
| 9,025 | 65,699 |
|---|---|
| 224,110 | 224,110 | 236,751 | 236,751 |
|---|---|---|---|
| 20,231 | 70,018 |
|---|---|
| 5,453 | 5,453 | 0 | 0 |
|---|---|---|---|
| 518,425 | 463,126 |
|---|---|
| 238,183 | 140,993 |
|---|---|
| –2,181 | –2,565 |
|---|---|
| –17,805 | –88,061 |
|---|---|
| 0 | 0 | –2,653 | –2,653 |
|---|---|---|---|
| –1,118 | –1,022 |
|---|---|
| –171,183 | –175,847 |
|---|---|
| –15,162 | –13,900 |
|---|---|
| –2,631 | –1,333 |
|---|---|
| 850,771 | 251,586 | 780,122 | 260,998 |
|---|---|---|---|
There were no transfers between fair value levels in 2024.
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Level 1 | 20,637 | 25,514 |
| Level 2 | 0 | 0 |
| Level 3 | 1,386 | |
| Total | 22,023 |
| € thousand | Sales | Purchases | Borrowings | Loans |
|---|---|---|---|---|
| TERME KRKA, d. o. o., Novo mesto, Slovenia* | 407 | 799 | 0 | 0 |
| KRKA-FARMA d.o.o., Zagreb, Croatia | 7,666 | 28,553 | 0 | 0 |
| KRKA ROMANIA S.R.L., Bucharest, Romania | 179 | 22,993 | 0 | 0 |
| KRKA-FARMA DOO BEOGRAD, Belgrade, Serbia | 35,936 | 5,531 | 0 | 0 |
| KRKA-FARMA DOOEL Skopje, Skopje, North Macedonia | 26,849 | 2,210 | 0 | 0 |
| KRKA Bulgaria EOOD, Sofia, Bulgaria | 60 | 3,880 | 0 | 0 |
| KRKA HELLAS E.P.E., Athens, Greece | 32 | 1,775 | 0 | 0 |
| KRKA FARMA d.o.o., Sarajevo, Sarajevo, Bosnia and Herzegovina | 4 | 537 | 0 | 0 |
| KRKA-RUS LLC, Istra, Russian Federation | 188,383 |
| Company | Location | Value 1 | Value 2 | Value 3 | Value 4 |
|---|---|---|---|---|---|
| KRKA FARMA LLC | Istra, Russian Federation | 13,144 | 0 | 0 | 0 |
| KRKA UKRAINE LLC | Kiev, Ukraine | 147,806 | 44,024 | 0 | 0 |
| LLC 'KRKA Kazakhstan' | Almaty, Kazakhstan | 216 | 14,807 | 0 | 0 |
| KRKA - POLSKA, Sp. z o. o. | Warsaw, Poland | 23,040 | 3,777 | 0 | 0 |
| KRKA ČR, s. r. o. | Prague, Czechia | 38,078 | 35,046 | 0 | 0 |
| KRKA Magyarország Kft. | Budapest, Hungary | 124 | 11,357 | 0 | 0 |
| KRKA Slovensko, s.r.o. | Bratislava, Slovakia | 88 | 12,313 | 0 | 0 |
| UAB KRKA Lietuva | Vilnius, Lithuania | 300 | 8,386 | 0 | 0 |
| SIA KRKA Latvia | Riga, Latvia | 45 | 4,533 | 0 | 200 |
| KRKA Finland Oy | Espoo, Finland | 17 | 3,180 | 0 | 0 |
| TAD Pharma GmbH | Cuxhaven, Germany | 16,335 | 2,075 | 0 | 0 |
| KRKA Sverige AB | Stockholm, Sweden | 67,812 | 8,947 | 0 | 0 |
| KRKA Pharma GmbH | Wien, Vienna, Austria | 46,135 | 2,150 | 0 | 0 |
| KRKA Farmacêutica, Unipessoal Lda. | Estoril, Portugal | 9,773 | 1,520 | 0 | 0 |
| Krka FARMACÉUTICA, S.L. | Madrid, Spain | 24,243 | 2,635 | 0 | 0 |
| KRKA Farmaceutici Milano S.r.l. | Milan, Italy | 13,531 | 2,448 | 0 | 0 |
| KRKA | 16,196 | 6,929 | 0 |
| Krka France Eurl, Paris, France | 4,541 | 2,899 | 0 | 71 |
|---|---|---|---|---|
| KRKA PHARMA DUBLIN LIMITED, Dublin, Ireland | 9,091 | 181 | 0 | 0 |
| KRKA Belgium, SA, Brussels, Belgium | 11,210 | 716 | 0 | 0 |
| KRKA UK LTD, London, United Kingdom | 23,482 | 1,329 | 0 | 0 |
| 123 Acurae Pharma GmbH, Cuxhaven, Germany | 2,558 | 173 | 0 | 0 |
| KRKA Netherlands B.V., Breskens, Netherlands | 11,357 | 0 | 0 | 0 |
| Ningbo Krka Menovo Pharmaceutical Co. Ltd., Ningbo, China | 3,016 | 683 | 0 | 0 |
| KRKA USA, LLC, Wilmington, ZDA | 0 | 8 | 0 | 0 |
| KRKA GCC L.L.C., Dubai, United Arab Emirates | 0 | 63 | 0 | 0 |
| Total | 728,510 | 249,601 | 0 | 271 |
** Including the subsidiary HCS bvba
The transactions between the Company and the above-mentioned subsidiaries were based on signed contracts, which included rendering products and services at market prices.
Loans received and granted do not include turnover from daily automatic cash pooling.
The balance of loans to subsidiaries is presented in Note 13– Loans, the balance of borrowings from subsidiaries is presented in Note 21 – Borrowings, the balance of receivables due from subsidiaries is presented in Note 17 – Trade and other receivables and the balance of current trade payables to subsidiaries is presented in Note 24 – Trade and other payables.
By the end of 2024, members of the Management Board of the Company held 37,040 Krka shares i.e. 0.1129% of total equity or 0.1207% of voting rights. Members of the Supervisory Board of the Company held 2,547 shares i.e. 0.0078% of total equity or 0.0083% of voting rights at the end of 2024.
| 31 Dec 2024 | 31 Dec 2023 | No. of shares | Equity share (%) | Share in voting rights (%) |
|---|---|---|---|---|
| Name | Share in voting rights (%) | Members of the Management Board | Share in voting rights (%) | Share in voting rights (%) |
|---|---|---|---|---|
| Jože Colarič | 22,500 | 0.0686 | 0.0733 | 22,500 |
| Aleš Rotar | 13,915 | 0.0424 | 0.0453 | 13,915 |
| Vinko Zupančič | 120 | 0.0004 | 0.0004 | 120 |
| David Bratož | 0 | / | / | 0 |
| Milena Kastelic | 505 | 0.0015 | 0.0016 | 505 |
| Total Members of the Management Board | 37,040 | 0.1129 | 0.1207 | 37,040 |
| Name | Share in voting rights (%) | Members of the Supervisory Board | Share in voting rights (%) | Share in voting rights (%) |
|---|---|---|---|---|
| Jože Mermal | 0 | / | / | 0 |
| Luka Cerar* | 0 | / | / | 0 |
| Borut Jamnik** | 0 | / | / | 0 |
| Matej Lahovnik | 1,000 | 0.0030 | 0.0033 | 1,000 |
| Julijana Kristl | 230 | 0.0007 | 0.0007 |
| Mojca Osolnik Videmšek | 0.0007 | 0.0007 | |
|---|---|---|---|
| Boris Žnidarič | 0.0019 | 0.0020 | |
| 0 | / | / | |
| 0 | / | / | |
| Members of the Supervisory Board, employee representatives | Mari Božič*** | 0 | |
| 0 | / | / | |
| Franc Šašek**** | 200 | 0.0006 | 0.0007 |
| Tomaž Sever | 500 | 0.0015 | 0.0016 |
| Mateja Vrečer | 500 | 0.0015 | 0.0016 |
| 500 | 0.0015 | 0.0016 | |
| Total Members of the Supervisory Board | 2,547 | 0.0078 | 0.0083 |
| Total | 39,587 | 0.1207 | 0.1290 |
| 39,887 | 0.1216 | 0.1292 |
** Supervisory Board member until 6 July 2023
*** Supervisory Board member since 21 June 2024
**** Supervisory Board member until 20 June 2024
Treasury shares were eliminated from the calculation of voting rights (2,107,337 treasury shares as at 31 December 2024 and 1,915,966 as at 31 December 2023).
| € thousand | 31 Dec 2024 | 31 Dec 2023 |
|---|---|---|
| Members of the Management Board | 4,832 | 4,317 |
| Members of the Supervisory Board | 381 | 311 |
| Total gross remuneration paid to groups of persons | 5,213 | 4,628 |
detaiedin the Report on Remuneration of the Members of the Management Board and Supervisory Board of the Company for 2024, where they are shown by payments in each year.
Gross earnings paid to persons employed under individual employment contracts in 2024 amounted to €14,447 thousand (2023: €13,310 thousand).
| € thousand | Fixed remuneration | Variable remuneration | Total | Gross | Net payout | Net fringe benefits and other earnings |
|---|---|---|---|---|---|---|
| Jože Colarič | 582 | 194 | 55 | 996 | 387 | 1,578 |
| Aleš Rotar | 456 | 156 | 45 | 644 | 250 | 1,100 |
| Vinko Zupančič | 384 | 134 | 40 | 536 | 209 | 920 |
| David Bratož | 379 | 131 | 40 | 527 | 205 | 906 |
| Milena Kastelic | 229 | 84 | 25 | 99 | 39 | 328 |
| Total remuneration paid to Members of the Management Board | 2,030 | 699 | 205 | 2,802 | 1,090 | 4,832 |
Net fringe benefits and other earnings
Liability insurance, supplementary pension insurance
Supplementary pension insurance
| Other bonuses | Refund of work-related funds | Pay for annual leave | Total | ||||
|---|---|---|---|---|---|---|---|
| Jože Colarič | 45.31 | 2.92 | 0.00 | 4.31 | 0.05 | 2.32 | 54.90 |
| Aleš Rotar | 35.95 | 2.92 | 0.00 | 2.42 | 1.12 | 2.32 | 44.72 |
| Vinko Zupančič | 30.39 | 2.92 | 0.00 | 3.42 | 0.96 | 2.32 | 40.00 |
| David Bratož | 29.81 | 2.92 | 0.00 | 4.23 | 1.20 | 2.32 | 40.46 |
| Milena Kastelic | 18.59 | 2.92 | 0.00 | 0.06 | 1.20 | 2.32 | 25.08 |
| Total remuneration paid to Members of the Management Board | 160.04 | 14.58 | 0.00 | 14.44 | 4.51 | 11.59 | 205.16 |
| € thousand | Fixed remuneration | Variable remuneration | Total | Gross | Net payout | Net fringe benefits and other earnings | Gross | Net |
|---|---|---|---|---|---|---|---|---|
| Jože Colarič | 526 | 191 | 33 | 858 | 335 | 1,384 | 559 |
| Aleš Rotar | 415 | 154 | 29 | 575 | 224 | 990 | 407 |
|---|---|---|---|---|---|---|---|
| Vinko Zupančič | 349 | 131 | 26 | 479 | 187 | 828 | 344 |
| David Bratož | 342 | 129 | 26 | 470 | 184 | 812 | 339 |
| Milena Kastelic | 209 | 82 | 19 | 94 | 37 | 303 | 138 |
| Total remuneration paid to Members of the Management Board | 1,841 | 687 | 133 | 2,476 | 967 | 4,317 | 1,787 |
| € thousand | Net fringe benefits and other earnings | Liability insurance, supplementary pension insurance | Supplementary pension insurance | Anniversary bonuses | Other bonuses | Refund of work-related funds | Pay for annual leave | Total |
|---|---|---|---|---|---|---|---|---|
| Jože Colarič | 27.15 | 2.90 | 0.00 | 1.10 | 0.06 | 2.15 | 33.36 | |
| Aleš Rotar | 19.27 | 2.90 | 0.00 | 3.12 | 1.10 | 2.15 | 28.54 | |
| Vinko Zupančič | 16.07 |
| David Bratož | 16.96 | 2.90 | 0.00 | 2.68 | 1.09 | 2.15 | 25.78 |
|---|---|---|---|---|---|---|---|
| Milena Kastelic | 12.34 | 2.90 | 0.00 | 0.08 | 1.16 | 2.15 | 18.63 |
| Total remuneration paid to Members of the Management Board | 91.79 | 14.50 | 0.00 | 11.43 | 4.30 | 10.75 | 132.77 |
| Members of the Supervisory Board, owner representatives | Basic pay for exercising the function | Fringe benefits and other earnings* | Attendance fees | Commuting allowances | Total | Gross | Net | ||
|---|---|---|---|---|---|---|---|---|---|
| Jože Mermal | 40.25 | 29.19 | 0.99 | 2.52 | 1.84 | 0.00 | 0.00 | 43.76 | 31.03 |
| Luka Cerar | 32.14 | 23.19 | 1.20 | 3.96 | 2.90 | 0.47 | 0.35 | 37.77 | 26.44 |
| Matej Lahovnik | 37.10 | 26.88 | 0.99 | 4.25 | 3.11 |
| Julijana Kristl | 35.00 | 25.33 | 1.38 | 3.38 | 2.48 | 0.47 | 0.34 | 40.23 | 28.15 |
|---|---|---|---|---|---|---|---|---|---|
| Mojca Osolnik Videmšek | 36.53 | 26.46 | 0.99 | 4.25 | 3.11 | 0.51 | 0.37 | 42.28 | 29.94 |
| Boris Žnidarič | 40.25 | 29.17 | 1.38 | 5.11 | 3.74 | 0.51 | 0.37 | 47.25 | 33.28 |
| Mari Božič** | 15.46 | 11.32 | 0.00 | 1.08 | 0.79 | 0.00 | 0.00 | 16.54 | 12.11 |
| Franc Šašek*** | 17.03 | 12.19 | 0.99 | 2.59 | 1.89 | 0.00 | 0.00 | 20.61 | 14.08 |
| Tomaž Sever | 37.40 | 27.10 | 0.99 | 3.96 | 2.90 | 0.59 | 0.43 | 42.94 | 30.43 |
| Mateja Vrečer | 40.89 | 29.65 | 0.99 | 4.82 | 3.53 | 0.00 | 0.00 | 46.70 | 33.18 |
332.05
*Fringe benefits and other earnings include collective liability insurance and, for individual members, also the membership fee for Slovenian Directors' Association (SDA).
**Supervisory Board member since 21 June 2024
***Supervisory Board member until 20 June 2024
In 2023 and 2024, members of the Management Board and the Supervisory Board, the employee representatives, did not receive any loans from the Company.
Loans to staff employed under individual employment contracts amounted to €187 thousand at 31 December 2024 (2023: €143 thousand). In the reporting period, repayments of loans by staff employed under individual employment contracts reached €33 thousand (2023: €58 thousand). The loans to the above-mentioned persons were earmarked for solving housing matters.
Krka’s operations in Ukraine and the Russian Federation are running smoothly, with business activities conducted through three subsidiaries and the controlling company Krka, d. d., Novo mesto.
Krka's subsidiary in Ukraine is engaged in marketing but not in sales or production activities and therefore had no receivables from customers outside the Group. However, it recorded other assets in the amount of €1,983 thousand (2023: €1,383 thousand) among which property, plant and equipment (business premises and passenger cars) represent the largest group. The Company is not materially exposed to credit risk (Note 30– Credit risk) or exchange rate risk (Note 30 – Foreign exchange risk) as sales are conducted in euros.
We operate in the Russian Federation through two subsidiaries. KRKA-RUS LLC manufactures pharmaceuticals. It produces the vast majority of products sold on the Russian market. Production there runs smoothly. KRKA FARMA LLC is engaged in marketing and sales activities. The largest increase in the Russian Federation compared to the previous year is observed in trade receivables outside or beyond the Krka Group and inventories. The foreign exchange rate risk exposure is disclosed in Note 30– Foreign exchange risk). The Russian Federation is Krka’s largest individual market (Note 3 – Revenue from contracts with customers).
Krka's investment in the subsidiary in Ukraine amounted as at 31 December 2024 to €9 thousand and the investments in the subsidiary in the Russian Federation totalled to €134,086 thousand. The Company did not increase its investments in its Ukraine and Russian Federation subsidiaries in 2024. As established upon the impairment indicator analysis performed, no indicators existed at 31 December 2024 that would require impairment testing of the Krka Group's investment in its subsidiaries in the Russian Federation.
As at 31 December 2024, the Company recorded €4,108 thousand of receivables due from customers and subsidiaries in Ukraine (31 December 2023: €3,075 thousand), whereof €219 thousand due from the subsidiary (31 December 2023: €39 thousand) and €3,889 thousand due from customers outside the Krka Group (31 December 2023: €3,037 thousand).
As for the Russian Federation, the Company recorded €193,465 thousand of receivables due from customers and subsidiaries (31 December 2023: €164,870 thousand), whereof €164,870 thousand to subsidiaries (31 December 2023: €164,870 thousand) and €12 thousand due from customers outside the Krka Group (31 December 2023: €0) (Note 30– Credit risk). In 2024, all payments between the subsidiaries in the Russian Federation and the controlling company were made without any specificity. The exposure to exchange rate risk is outlined in Note 30 – Foreign exchange rate risk.
| 2024 | Share (%) | 2023 | Share (%) | |
|---|---|---|---|---|
| PhD | 171 | 2.6 | 173 | 2.7 |
| MSc | 268 | 4.0 | 269 | 4.2 |
| University education | 2,206 | 32.8 | 2,128 | 33.2 |
| Higher professional education | 1,015 | 15.1 | 915 | 14.3 |
| Vocational college education | 270 | 4.0 | 255 | 4.0 |
| Secondary school education |
| € thousand | 2024 | 2023 |
|---|---|---|
| Contract value of auditing the annual consolidated and separate financial statements performed by the audit firm KPMG Slovenija, d.o.o. | 133 | 128 |
| Contract value of auditing the subsidiaries’ reporting for the purpose of preparing the consolidated financial statements, performed by companies within the KPMG network | 57 | 93 |
| Contract value of auditing the subsidiaries’ local financial statements, rendered by companies within the KPMG network | 66 | 45 |
| Total contract value of audit services | 256 | 266 |
| Contract value of the audit service relating to sustainability reporting (ESG) | 80 | 0 |
| Contract value of other non-audit services, rendered by the audit firm KPMG Slovenija, d.o.o. | 13 | 12 |
| Total contract value of non-audit services | 93 | 12 |
| Total contract value of services | 349 | 278 |
Repurchase of Krka treasury shares in 2024 by date
| Date | No. of shares | Average share price (€) | Value of treasury shares (€ thousand) |
|---|---|---|---|
| Date | No. of shares | Average share price (€) | Value of treasury shares (€ thousand) |
| Date | No. of shares | Average share price (€) |
| Date | Value of treasury shares (€ thousand) | Price (€) |
|---|---|---|
| 3 Jan 2024 | 920 | 110.81 |
| 14 Feb 2024 | 715 | 112.66 |
| 25 Mar 2024 | 1,642 | 125.50 |
| 4 Jan 2024 | 619 | 110.90 |
| 15 Feb 2024 | 1,040 | 118.19 |
| 26 Mar 2024 | 1,034 | 129.42 |
| 5 Jan 2024 | 874 | 110.91 |
| 16 Feb 2024 | 1,037 | 118.57 |
| 27 Mar 2024 | 297 | 129.35 |
| 8 Jan 2024 | 645 | 111.52 |
| 19 Feb 2024 | 700 | 118.55 |
| 28 Mar 2024 | 1,589 | 133.14 |
| 9 Jan 2024 | 846 | 112.07 |
| 20 Feb 2024 | 1,011 | 118.19 |
| 2 Apr 2024 | 1,154 | 128.66 |
| 10 Jan 2024 | 818 | 112.18 |
| 21 Feb 2024 | 1,021 | 118.57 |
| 3 Apr 2024 | 720 | 127.57 |
| 11 Jan 2024 | 846 | 112.81 |
| 22 Feb 2024 |
| 962 | 118.46 | 114 | 4 Apr 2024 |
|---|---|---|---|
| 1,528 | 127.53 | 195 | 12 Jan 2024 |
| 690 | 113.12 | 78 | 23 Feb 2024 |
| 989 | 119.19 | 118 | 5 Apr 2024 |
| 1,172 | 128.37 | 150 | 15 Jan 2024 |
| 807 | 113.22 | 91 | 26 Feb 2024 |
| 1,089 | 120.32 | 131 | 8 Apr 2024 |
| 600 | 127.21 | 76 | 16 Jan 2024 |
| 804 | 113.94 | 92 | 27 Feb 2024 |
| 1,078 | 120.20 | 130 | 9 Apr 2024 |
| 1,484 | 126.70 | 188 | 17 Jan 2024 |
| 502 | 113.75 | 57 | 28 Feb 2024 |
| 1,153 | 120.39 | 139 | 10 Apr 2024 |
| 1,470 | 125.58 | 185 | 18 Jan 2024 |
| 772 | 114.18 | 88 | 29 Feb 2024 |
| 1,221 | 120.94 | 148 | 11 Apr 2024 |
| 1,250 | 124.04 | 155 | 19 Jan 2024 |
| 187 | 114.91 | 21 | 1 Mar 2024 |
| 1,024 | 121.12 | 124 | 12 Apr 2024 |
| 1,457 | 124.20 | 181 | 22 Jan 2024 |
| 831 | 120.52 |
| Date | Value | Price |
|---|---|---|
| 4 Mar 2024 | 1,246 | 122.54 |
| 15 Apr 2024 | 1,346 | 123.20 |
| 23 Jan 2024 | 864 | 117.49 |
| 5 Mar 2024 | 1,292 | 123.24 |
| 16 Apr 2024 | 1,178 | 122.75 |
| 24 Jan 2024 | 861 | 116.94 |
| 6 Mar 2024 | 1,350 | 124.13 |
| 17 Apr 2024 | 351 | 125.04 |
| 25 Jan 2024 | 881 | 116.10 |
| 7 Mar 2024 | 450 | 123.50 |
| 18 Apr 2024 | 1,353 | 126.62 |
| 26 Jan 2024 | 886 | 115.18 |
| 8 Mar 2024 | 765 | 123.83 |
| 19 Apr 2024 | 870 | 125.32 |
| 29 Jan 2024 | 949 | 115.92 |
| 11 Mar 2024 | 852 | 121.93 |
| 22 Apr 2024 | 1,215 | 124.59 |
| 30 Jan 2024 | 705 | 115.48 |
| 12 Mar 2024 | 1,361 | 122.70 |
| 23 Apr 2024 | 1,229 | 125.58 |
| 31 Jan 2024 |
| 963 | 115.48 | 111 | 13 Mar 2024 |
|---|---|---|---|
| 1,469 | 124.20 | 182 | 24 Apr 2024 |
| 938 | 125.70 | 118 | 1 Feb 2024 |
| 972 | 115.56 | 112 | 14 Mar 2024 |
| 200 | 124.70 | 25 | 25 Apr 2024 |
| 1,076 | 126.64 | 136 | 2 Feb 2024 |
| 880 | 112.84 | 99 | 15 Mar 2024 |
| 1,204 | 127.11 | 153 | 26 Apr 2024 |
| 875 | 125.87 | 110 | 5 Feb 2024 |
| 992 | 115.68 | 115 | 18 Mar 2024 |
| 1,608 | 127.15 | 204 | 29 Apr 2024 |
| 600 | 127.00 | 76 | 6 Feb 2024 |
| 988 | 116.64 | 115 | 19 Mar 2024 |
| 1,082 | 126.29 | 137 | 30 Apr 2024 |
| 1,390 | 130.94 | 182 | 7 Feb 2024 |
| 1,052 | 121.67 | 128 | 20 Mar 2024 |
| 1,662 | 125.77 | 209 | 6 May 2024 |
| 1,344 | 126.94 | 171 | 12 Feb 2024 |
| 778 | 117.90 | 92 | 21 Mar 2024 |
| 869 | 126.91 | 110 | 7 May 2024 |
| 1,292 | 126.05 |
| Date | No. of shares | Average share price (€) | Value of treasury shares (€ thousand) |
|---|---|---|---|
| 13 Feb 2024 | 1,035 | 118.03 | |
| 22 Mar 2024 | 541 | 127.58 | 69 |
| 8 May 2024 | 1,288 | 120.59 | 155 |
| 9 May 2024 | 1,337 | 125.05 | 167 |
| 10 May 2024 | 1,326 | 126.73 | 168 |
| 12 Jul 2024 | 1,121 | 144.17 | 162 |
| 15 Jul 2024 | |||
| 3 Sep 2024 | 928 | 138.25 | 128 |
| 4 Sep 2024 | 845 | 136.82 | 116 |
| 5 Sep 2024 | 797 | 136.85 | 109 |
| 11 Oct 2024 | 1,023 | 136.08 | 139 |
| 14 Oct 2024 | 1,028 | 136.22 | 140 |
| 15 Oct 2024 | 1,050 | 136.53 | 143 |
| 837 | 144.40 | 121 | 6 Sep 2024 |
|---|---|---|---|
| 815 | 137.03 | 112 | 16 Oct 2024 |
| 1,079 | 136.21 | 147 | 16 Jul 2024 |
| 1,075 | 147.96 | 159 | 9 Sep 2024 |
| 823 | 136.72 | 113 | 17 Oct 2024 |
| 1,107 | 136.22 | 151 | 17 Jul 2024 |
| 887 | 149.60 | 133 | 10 Sep 2024 |
| 831 | 137.10 | 114 | 18 Oct 2024 |
| 877 | 134.74 | 118 | 18 Jul 2024 |
| 902 | 149.63 | 135 | 11 Sep 2024 |
| 672 | 137.47 | 92 | 21 Oct 2024 |
| 962 | 135.84 | 131 | 19 Jul 2024 |
| 916 | 148.86 | 136 | 12 Sep 2024 |
| 865 | 138.22 | 120 | 22 Oct 2024 |
| 985 | 136.24 | 134 | 22 Jul 2024 |
| 942 | 144.81 | 136 | 13 Sep 2024 |
| 865 | 137.97 | 119 | 23 Oct 2024 |
| 994 | 135.92 | 135 | 23 Jul 2024 |
| 965 | 144.69 | 140 | 16 Sep 2024 |
| 743 | 137.44 | 102 | 24 Oct 2024 |
| 542 | 135.72 |
| Date | Value 1 | Value 2 |
|---|---|---|
| 24 Jul 2024 | 1,136 | 140.92 |
| 17 Sep 2024 | 785 | 137.72 |
| 25 Oct 2024 | 875 | 135.90 |
| 25 Jul 2024 | 1,198 | 134.59 |
| 18 Sep 2024 | 778 | 137.52 |
| 28 Oct 2024 | 872 | 136.22 |
| 26 Jul 2024 | 1,362 | 133.61 |
| 19 Sep 2024 | 772 | 137.27 |
| 29 Oct 2024 | 884 | 136.22 |
| 29 Jul 2024 | 409 | 135.72 |
| 20 Sep 2024 | 929 | 136.86 |
| 30 Oct 2024 | 894 | 136.35 |
| 30 Jul 2024 | 1,547 | 137.75 |
| 23 Sep 2024 | 946 | 137.47 |
| 4 Nov 2024 | 867 | 135.90 |
| 31 Jul 2024 | 1,640 | 137.97 |
| 24 Sep 2024 | 948 | 137.56 |
| 5 Nov 2024 | 872 | 136.00 |
| 1 Aug 2024 | 1,375 | 137.86 |
| 25 Sep 2024 | 966 | 136.72 |
| 6 Nov 2024 |
| 929 | 136.10 | 126 | 19 Aug 2024 |
|---|---|---|---|
| 1,662 | 135.52 | 225 | 26 Sep 2024 |
| 976 | 136.88 | 134 | 7 Nov 2024 |
| 830 | 136.22 | 113 | 20 Aug 2024 |
| 1,652 | 134.59 | 222 | 27 Sep 2024 |
| 1,081 | 136.48 | 148 | 8 Nov 2024 |
| 1,046 | 136.22 | 142 | 21 Aug 2024 |
| 973 | 134.95 | 131 | 30 Sep 2024 |
| 1,096 | 136.22 | 149 | 11 Nov 2024 |
| 1,067 | 137.10 | 146 | 22 Aug 2024 |
| 1,421 | 136.13 | 193 | 1 Oct 2024 |
| 966 | 136.10 | 131 | 12 Nov 2024 |
| 1,051 | 136.83 | 144 | 23 Aug 2024 |
| 1,370 | 136.17 | 187 | 2 Oct 2024 |
| 955 | 133.77 | 128 | 13 Nov 2024 |
| 1,084 | 136.54 | 148 | 26 Aug 2024 |
| 823 | 136.68 | 112 | 3 Oct 2024 |
| 996 | 133.26 | 133 | 14 Nov 2024 |
| 1,109 | 138.29 | 153 | 27 Aug 2024 |
| 254 | 136.72 | 35 | 4 Oct 2024 |
| 941 | 134.46 |
| Date | No. of shares | Average share price (€) | Value of treasury shares (€ thousand) |
|---|---|---|---|
| 15 Nov 2024 | 1,190 | 138.62 | |
| 28 Aug 2024 | 711 | 137.16 | |
| 7 Oct 2024 | 950 | 135.84 | |
| 18 Nov 2024 | 1,021 | 138.72 | |
| 29 Aug 2024 | 845 | 137.52 | |
| 8 Oct 2024 | 978 | 136.13 | |
| 19 Nov 2024 | 1,185 | 138.34 | |
| 30 Aug 2024 | 816 | 138.10 | |
| 9 Oct 2024 | 977 | 136.25 | |
| 20 Nov 2024 | 1,021 | 139.12 | |
| 2 Sep 2024 | 801 | 138.60 | |
| 10 Oct 2024 | 913 | 136.44 | |
| 22 Nov 2024 | 1,175 | 138.98 |
| Date | Amount (€ thousand) | Price | Shares |
|---|---|---|---|
| 25 Nov 2024 | 1,240 | 139.21 | 173 |
| 4 Dec 2024 | 1,368 | 138.22 | 189 |
| 12 Dec 2024 | 1,210 | 138.33 | 167 |
| 26 Nov 2024 | 1,295 | 138.87 | 180 |
| 5 Dec 2024 | 1,275 | 138.13 | 176 |
| 13 Dec 2024 | 1,363 | 139.10 | 190 |
| 27 Nov 2024 | 1,312 | 138.60 | 182 |
| 6 Dec 2024 | 1,283 | 137.61 | 177 |
| 16 Dec 2024 | 1,342 | 139.22 | 187 |
| 28 Nov 2024 | 1,362 | 138.83 | 189 |
| 9 Dec 2024 | 1,325 | 137.22 | 182 |
| 17 Dec 2024 | 1,351 | 138.22 | 187 |
| 29 Nov 2024 | 1,344 | 138.92 | 187 |
| 10 Dec 2024 | 1,303 | 136.69 | 178 |
| 18 Dec 2024 | 1,380 | 138.22 | 191 |
| 2 Dec 2024 | 1,373 | 138.22 | 190 |
| 11 Dec 2024 | 1,010 | 137.90 | 139 |
| 19 Dec 2024 | 1,200 | 138.12 | 166 |
| 3 Dec 2024 | 1,276 | 138.51 | 177 |
The 2024 financial statements were not impacted by the events after the end of the period.
Krka and the Indian company Laurus Labs Ltd. (hereinafter Laurus) established a joint venture, Krka Pharma Pvt. Ltd., headquartered in Hyderabad, India, in April 2024. Krka holds a 51% stake, and Laurus has a 49% stake in the joint venture. In early October 2024, Krka contributed €2.5 million in initial capital, followed by a second instalment of registered capital on 10 March 2025, totalling €9,233,550 or 867,000 thousand Indian rupees.
The Company repurchased 87,928 treasury shares between 1 January 2025 and 14 March 2025 and thus held 2,195,265 treasury shares at the end of this period, accounting for 6.69% of total shares.
President and members of Krka’s Management Board are aware of the content of the integral parts of the 2024 Annual Report of Krka and the Krka Group, and hence the 2024 Annual Report in its entirety. We hereby acknowledge the Report by our signatures.
Jože Colarič
President of the Management Board and CEO
dr. Aleš Rotar
Member of the Management Board
dr. Vinko Zupančič
Member of the Management Board
David Bratož
Member of the Management Board
Milena Kastelic
Member of the Management Board – Worker Director
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