Sopharma – Q4 2025 cons review – Very profitable 2025, eclipsed only by the start of 2026

Very profitable 2025, eclipsed only by the start of 2026

Q4 2025 Consolidated Results

• Revenues from sales increased by EUR 249.7mln to EUR 1,361mln, compared to EUR 1,009m in Q4 2024 or 22.5% increase. The main push came from sales of products, for which the approval for distribution came in late 2024 and those increased by 23.3% adding EUR 216mln.
• Sales growth for Q4’25 in the domestic market marked 0.2%. As per data from IQVIA, Sopharma has the 17^th largest share in the Bulgarian market responsible for 1.66% of the supply in nominal terms, while it holds the 2^nd largest share with 6.06% with regards to volume (amount of meds). Note that while sales of Sopharma grew, the relative share declined slightly from last year, indicating that the market as a whole grew even more, which is a definite positive sign indicating a significant upside potential.
• The positions of the main competitors are as follow: Merck – 6.13% (0.19% vol), AstraZeneca – 5.36% (0.59% vol), Swixx Biopharma – 4.71% (1.67% vol), Roche – 4.70% (0.26% vol), Novartis – 4.20% (1.15% vol), Abbvie – 4.09% (0.10% vol), Pfizer – 3.73% (0.70% vol), Johnson & Johnson – 3.11% (0.69% vol), Teva – 2.89% (8.55% vol), Stada – 2.72% (4.42% vol). The highest sold products are Analgin, Vicetin, Famotidine, vitamin C, Paracetamol, Methylprednisolone.
• When comparing previous periods, it is clear that the biggest names have increased their share in nominal terms and many have decreased in volume terms. This suggest a gradual increase in prices, which are also sticky and they have managed to transfer the higher personnel cost to the end products. On the contrary, producers such as Sopharma which specialize in generic products, had to push out greater amounts to compensate. Inflationary periods, such as the current one can be a great opportunity for producers, such as Sopharma, as larger amount of consumer might be motivated to shift to the generic versions of the meds that they use. On the contrary, there might be pressure on OPEX.
• International growth was driven by sales in Eastern European and Central Asian countries, which have been the primary engine for the company over the last year. While growth was hindered in many of these since 2022 due to the conflict in Ukraine, the company managed to expand those accounts in 2025 and is in the position to look for regional M&A alternatives, which can boost market penetration.
• EBITDA increased significantly by 55.2% to EUR 111.9mln and Net Profit shot up by 76% to EUR 72.4mln.
• OPEX increased 20.6% to EUR 1,289mln. In that, COGS had the largest contribution increasing by EUR 163mln or 20.1%. Personnel expense added EUR 28.2mln or 26.7% to reach EUR 133.8mln as a result of salaries indexation and increase in workforce. External services added EUR 11mln to reach EUR 68.9mln and it is the result of distribution costs.
• Sopharma has managed to keep most costs growth below the growth of sales. The only exclusion are Payroll and Amortization. Both accounts amount to 13.5% of OPEX and are the consequence of an expanding company. Furthermore, a better motivated staff can contribute to sales growth in the future.
• Trade Receivables had marked a significant increase (38%) in Q3 and that raised questions about possible further delinquencies. By YE 2025, however, they decreased by 13.3% to EUR 171mln (down from EUR 198mln). This shows that Sopharma’s clients, albeit dependent on state budgets and schedules (state run hospitals), find ways to pay off liabilities towards them.
• PB ratio is 2.16 where we take into consideration non-material assets, such as trademarks and reputation, as they are important in this industry and main distinguishing factor. This is especially true in the generics market, where the products are essentially the same. If we use the formula, where they are excluded, the PB ratio would be 3.14.
• Total debt marked an increase of 29% YoY to EUR 303mln, adding EUR 69mln. The greater part of that increase took place in Q1 and Q2. In that, LT debt increased 61% adding EUR 42mln to reach EUR 110mln, EUR 69mln of which was from LT bank debt). ST debt increased 16% to reach EUR 194mln. The ST debt to banks increased by EUR 71mln to reach EUR 170mln. The ST part of LT loans, however dropped from EUR 57.5mln to EUR 11.7mln indicating good debt management. Sopharma specifies that the purpose of it is the acquisition of long term assets, which will serve the expansion of the production of the company and that it is in line with debt covenants, such as Current Ratio of 1.1, net debt not exceeding 4x EBITDA, capital adequacy greater or equal than 40% and not decreasing own capital after last audited financials. The major withdrawals came from credit lines with limits of EUR 40mln, BGN 30mln, EUR 20mln, EUR 3.5mln and EUR 4.7mln. Currently, everything is within required limits.
• Sopharma showed excellent resilience and very positive performance over the last few years considering the heavy dependency on Eastern European and Central Asian markets, whose supply chains were affected from the war with Ukraine. An example is Serbia, where It managed to expand and that market alone accounts for 16.4% of its total revenues in 2025.
• A huge plus for Sopharma is that it is very well vertically integrated – aside from the production of generic meds, it has a vast network of over 200 pharmacies, which are used to sell their products as well as those of the competitors. In an expanding market, they are able to capture a portion of the benefits of sales of their competitors and lower their margins to the end customer.
• The performance in 2026 has been positive. The February results showed that for the month of February alone, the company realized growth in sales of 106% driven by the 8% growth in the domestic market and 230% growth in exports. The cumulative results (YTD), however showed overall growth of 6%, which was the result of 36% drop in the domestic market and 37% growth in exports. Considering it was only the January performance prior to that, we can assume that the drop was due to purchasing/scheduling problems from the state-run hospitals. It is also very likely that the domestic demand will rebound as the orders compensating for the earlier drop will land.

Full report can be downloaded here.