Key Highlights from the 2025 Financial Reports
• Independent Audit Opinion: The Group’s financial statements received an unqualified opinion from Yeditepe Bağımsız Denetim, meaning the reports fairly represent the financial position and performance in accordance with Turkish Financial Reporting Standards (TFRS).
• Revenue Growth: The Group reported total revenue of 172.01 billion TL for 2025, a slight increase compared to 168.35 billion TL in 2024.
• Net Profitability Shift: The Group recorded a net loss of 379.80 million TL for the year 2025, a significant shift from the net profit of 2.69 billion TL reported in 2024.
• Impact of Inflation Accounting (TMS 29): The financial statements were prepared using high-inflation accounting principles. A major factor in the net loss was the net monetary position loss of 4.87 billion TL, which reflects the impact of inflation on the Group’s purchasing power.
• Asset Composition: Total assets reached 80.93 billion TL as of year-end 2025. Trade receivables remain a critical component, amounting to 42.56 billion TL, which accounts for approximately 52.60% of total assets.
• Operational Scale: Selçuk Ecza continues to be a major player in pharmaceutical distribution with 27 main branches and 83 regional warehouses across Turkey. As of December 31, 2025, the Group employed 5,971 personnel.
• Dividends: Despite the net loss for the reporting year, the Group paid a cash dividend of 286.81 million TL in 2025 (based on 2024 results).
• Key Audit Matter: The auditor identified the recoverability of trade receivables as a key audit matter due to the high volume of customers and the estimates required for credit loss provisions under TFRS 9.

The $4.9 Billion Paradox: Behind the 2025 Inflationary Squeeze of Turkey’s Pharmaceutical Titan

The Invisible Backbone of Healthcare

Every time you walk into a neighborhood pharmacy to pick up a life-saving prescription or a simple box of aspirin, you are witnessing the final step of a massive, invisible ballet. Medicines do not simply appear on those shelves; they are funneled through a complex web of logistics that must balance clinical urgency with economic reality. At the heart of this system in Turkey stands Selçuk Ecza Deposu, a titan of pharmaceutical distribution. As the primary bridge between global manufacturers and thousands of hospitals and pharmacies, the company’s 2025 performance offers a fascinating—and perhaps startling—look at how a company can dominate an industry yet still find itself grappling with the harsh realities of a hyperinflationary economy.

The $4.9 Billion Revenue Paradox

The most striking feature of Selçuk Ecza Deposu’s 2025 financial report is the sheer scale of its operations contrasted against its final bottom line. In 2025, the company generated a staggering 4.915 billion (172.01 billion TL)** in revenue (*Hasılat*). However, the narrative of growth is complicated by a surprising transition: after booking a net profit of **77.0 million (2.69 billion TL) in 2024, the company reported a net period loss of $10.85 million (379.8 million TL) for 2025.

As an analyst, it is critical to note that this “paradox” began well before the accounting adjustments. Despite the increase in sales volume, core margins were squeezed; Gross Profit (Brüt Kar) actually fell from 17.03 billion TL in 2024 to 14.19 billion TL in 2025. This indicates that the cost of sales grew significantly faster than revenue. The integrity of these complex figures is verified by the independent auditor, Yılmaz Güney of Yeditepe Bağımsız Denetim ve Yeminli Mali Müşavirlik A.Ş. (an associate member of Praxity):

“In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of 31 December 2025… in accordance with Turkey Financial Reporting Standards (TFRSs).”

A Balance Sheet Built on Credit: The $1.216 Billion Receivable

For Selçuk Ecza Deposu, the balance sheet is less about cash on hand and more about the promises of payment. As of late 2025, the company held $1.216 billion (42.56 billion TL) in trade receivables (Ticari Alacaklar), representing a massive 52.60% of its total assets.

The risk of this credit-heavy model is underscored by the company’s dwindling liquidity; cash and cash equivalents dropped from 142.7 million (4.99 billion TL) in 2024 to just **84.4 million (2.95 billion TL)** in 2025. Managing $1.216 billion in “IOUs” requires rigorous oversight, which the auditors identified as a “Key Audit Matter.” To verify the recoverability of these funds, the following procedures were conducted:

• Confirmation Letters: Direct verification of balances by sending letters to a sample of pharmacy and hospital debtors.
• Post-Balance Sheet Testing: Evaluating actual cash collections made after the reporting date to prove the validity of the year-end balances.
• Collateral Verification: Sampling mortgages and guarantees held against pharmacy credit limits.
• Legal Review: Analyzing reports from legal counsel regarding overdue accounts currently in litigation to ensure adequate provisioning.

The Logistics Empire: 5,900+ Employees and 110 Locations

The operational scale required to move billions of dollars in medicine across Turkey is immense. Selçuk Ecza Deposu, along with its subsidiary As Ecza, functions as a critical infrastructure provider. The group employs 5,971 people; a deeper look reveals that 5,145 of these professionals are employed directly by the parent company (Ana Ortaklık).

Their physical footprint is equally impressive, consisting of 27 main branches and 83 regional warehouses (110 total distribution points). This network ensures that even remote pharmacies have access to the same medical inventory as those in Istanbul. Acting as the primary bridge between manufacturers and health providers, the group manages thousands of daily shipments while maintaining the strict temperature-controlled “cold chain” requirements essential for modern pharmaceuticals.

Navigating Hyperinflation: The TMS 29 Effect

The primary driver behind the reported net loss in a high-revenue year is the application of inflation accounting (TMS 29). In economies where the 3-year cumulative inflation rate exceeds 100%—which in Turkey reached a reported 211%—financial statements must be adjusted to reflect the loss of purchasing power.

This adjustment resulted in a “Net Monetary Position Loss” of approximately $139.30 million (4.87 billion TL). Because the company holds massive monetary assets like trade receivables, the “melting” value of the currency creates significant paper losses. It is the ultimate storyteller’s challenge: the company is moving more product than ever to keep the nation healthy, but the currency is devaluing faster than those operational gains can be converted into booked profit.

Conclusion: A Forward-Looking Reflection

Selçuk Ecza Deposu remains a cornerstone of the Turkish healthcare system, demonstrating incredible resilience by maintaining a 110-location network and a nearly 6,000-person workforce. However, the 2025 figures serve as a stark reminder of how hyperinflation can distort traditional business metrics.

When a nation’s medicine supply chain faces a $139 million inflationary headwind, how do the metrics of “success” need to change for the companies keeping us healthy?

Briefing Document: Consolidated Financial Performance and Audit Analysis of Selçuk Ecza Deposu (2025)

Executive Summary

This briefing document synthesizes the consolidated financial results and independent audit findings for Selçuk Ecza Deposu Ticaret ve Sanayi A.Ş. (the “Group”) for the fiscal year ending December 31, 2025.

The Group, a dominant player in the Turkish pharmaceutical distribution sector, received an unqualified audit opinion from Yeditepe Bağımsız Denetim, indicating that the financial statements fairly represent the Group’s position in accordance with Turkey Financial Reporting Standards (TFRS). However, the fiscal year 2025 was marked by a transition from profitability to a net loss of 10.85 million**, despite a slight increase in nominal revenue to **4.91 billion.

Critical concerns identified include a heavy concentration of assets in trade receivables (52.60% of total assets) and the significant impact of hyperinflationary accounting (TMS 29), with three-year cumulative inflation recorded at 211%.

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1. Corporate Profile and Scope of Operations

Selçuk Ecza Deposu operates as a critical intermediary between pharmaceutical manufacturers, hospitals, and pharmacies.

• Network Reach: As of year-end 2025, the Group operates 27 main branches and 83 regional warehouses across Turkey.
• Human Capital: The workforce totaled 5,971 employees, a decrease from 6,157 in the previous year.
• Ownership Structure: The Group is primarily controlled by Selçuk Ecza Holding A.Ş. (77.32% direct, 82.42% total including market purchases). The Ahmet and Nezahat Keleşoğlu Foundation maintains a 51% stake in the holding company.
• Diversification: Beyond pharmaceutical distribution, the Group operates “Itriyat” (cosmetics and personal care) sections in 8 branches, though this remains below 10% of total revenue.

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2. Independent Audit and Key Audit Matters

The audit was conducted by Yeditepe Bağımsız Denetim ve Yeminli Mali Müşavirlik A.Ş. (an associate member of PRAXITY).

2.1 The Audit Opinion

The auditor stated:

“In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of 31 December 2025, and its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with TFRS.”

2.2 Key Audit Matter: Trade Receivables

The recoverability of trade receivables was identified as the primary audit risk.

• Exposure: Trade receivables totaled $1,216.12 million, representing 52.60% of total assets.
• Risk Profile: Receivables are spread across a high volume of customers with low individual balances.
• Audit Response: The auditors evaluated credit limits, collateral, and aging reports. They specifically reviewed doubtful debt provisions and performed circularization (confirmation letters) for a sample of balances.

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3. Financial Position Analysis

The following table summarizes the consolidated balance sheet as of December 31, 2025 (converted at a rate of 1 USD = 35.00 TRY for reporting purposes).

Consolidated Financial Status (USD)

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4. Operational Performance and Profitability

The Group experienced a significant downturn in profitability during 2025.

Income Statement Summary (USD)

Key Performance Insights

• Revenue Growth: Nominal revenue in TRY increased by 2.17%, but the cost of sales grew at a higher rate (4.29%), leading to a 16.6% decline in gross profit.
• Net Loss Drivers: The primary driver for the net loss was the impact of hyperinflationary accounting. The Net Monetary Position Loss of 139.30 million** and a surge in marketing expenses to **254.25 million weighed heavily on the bottom line.
• Loss Per Share: The Group reported a loss per share of 0.0175** (0.612 TL), compared to a profit of **0.1240 (4.339 TL) in 2024.

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5. Inflation Accounting (TMS 29)

In accordance with KGK regulations, the Group applied inflation adjustment to its 2025 financial statements.

• Three-Year Cumulative Inflation: 211% as of Dec 31, 2025.
• Methodology: All non-monetary assets (fixed assets, inventories, equity) were restated to the purchasing power of the TRY as of the balance sheet date.
• Monetary Impact: The net monetary position loss indicates that the Group’s monetary assets exceeded its monetary liabilities during a period of high inflation, leading to a loss in purchasing power.

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6. Liquidity and Capital Resources

• Cash Reserves: Cash and equivalents decreased significantly to $84.44 million from $142.71 million.
• Borrowings: The Group managed to drastically reduce its total borrowings from 300.38 million** in 2024 to **22.74 million in 2025, largely by settling issued debt instruments and bank loans.
• Dividends: On April 17, 2025, the Group paid a cash dividend totaling $8.19 million (286.8 million TL).
• Litigation: The Group is involved in various legal proceedings, maintaining a provision of 450,463** for lawsuits. Total execution proceedings initiated by the Group against third parties amount to **8.21 million.

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7. Significant Accounting Estimates and Assumptions

The Group’s management utilizes several critical estimates:

• Doubtful Receivables: Calculated using the TFRS 9 simplified approach (lifetime expected credit losses).
• Inventory Valuation: Valued at the lower of cost (FIFO) or net realizable value, net of financing costs.
• Employee Benefits: Retirement pay liability (Kıdem Tazminatı) is calculated using an inflation rate of 21.00% and a discount rate of 24.80%, with a 91% probability of continued employment.