Directors at Northumberland-based pharmaceutical firm Sterling Pharma Solutions have pinpointed 2026 as a pivotal year for recovery, following a difficult financial period marked by steep losses and declining sales.
A Challenging Financial Year
Newly filed accounts for the year ending March 2025 reveal a tough trading period for the Cramlington-headquartered company. Revenue fell sharply by 28%, from £108.9 million to £78.1 million. The firm's operating loss widened dramatically to £50.4 million, a significant increase from the £372,000 loss reported the previous year.
This substantial loss was partly driven by an exceptional administrative expense of £25 million, linked to an impairment review of intercompany receivables. The company also noted a slight reduction in its workforce, with employee numbers decreasing from 654 to 644.
Causes and Strategic Response
In their report, the board attributed the revenue decline primarily to a loss of volume from two key customers. One client was managing an inventory surplus built up in prior years, while another was impacted by a significant market downturn due to a new competitive entrant.
The directors admitted the company was "slow to address costs," which exacerbated the operating loss. In response, a cost reduction plan has been developed for implementation in the first quarter of the 2026 financial year. Despite the financial pressures, investment in research and development remained a high priority, focusing on new process development and exploring innovative technologies.
Leadership Change and Future Outlook
The period also saw a change at the helm. In October 2025, Kevin Cook retired after serving as CEO since 2013. He was succeeded by Karl Rotthier, who took up the position on October 21. Chair Chris Brinsmead welcomed the new CEO, highlighting his experience in driving international growth and operational excellence.
Looking forward, management expresses confidence in a turnaround. "Management sees 2026 as a recovery year," the report states. This optimism is based on the current order book, the sales potential of several new products in development, and improving traction from new business wins secured in FY25. The company's Sterling Academy also continued to support staff development, with 58 employees gaining qualifications and 64 receiving promotions during the year.
