* Sales up by 1 pct
* 2014 forecast unchanged
(Updates with quotes, details, background)
By Marja Novak
LJUBLJANA, May 15 Slovenian pharmaceutical
company Krka on Thursday reported a 17 percent fall in
first-quarter net profit to 42.5 million euros, citing negative
impact of exchange rates on its earnings, particularly the
depreciation of the Russian rouble.
Krka, Slovenia's largest listed company, said net negative
currency effects amounted to 14 million euros ($19.19 million)
in the first three months of the year, while they had a positive
impact of 2 million euros on profit in the same period of 2013.
"In Ukraine, which is Krka's second largest market in
eastern Europe (behind Russia), orders, supply and payments are
developing normally for now in spite of difficult conditions in
that country at the moment," Krka said.
Sales rose by 1 percent to 298 million euros, mainly on
account of higher sales in eastern Europe where they rose by 16
percent. Sales in western Europe were down by 8 percent, the
company said in a statement.
Krka maintained its forecast, made in November last year,
for 2014 profit of some 172.8 million euros, unchanged from
2013, on sales of 1.25 billion euros, up from 1.2 billion in
"I believe it is possible that Krka would miss its 2014
profit target due to the exchange rate risk and the negative
impact of the Ukraine crisis," Marko Rozman, head of investment
at the treasury sector of Dezelna Banka.
"However, the most important thing is that sales continue to
grow albeit at a small rate so I do not expect the report of the
fall in profit will push the shares down significantly," he
Krka shares fell 1.34 percent to 61.66 euros by the end of
trading on Thursday following publication of the results, while
the blue-chip SBI index was down 0.28 percent.
($1 = 0.7294 Euros)
(Reporting By Marja Novak; editing by Jason Neely and Jane