The management of the National Palace of Culture published an official position with which it responds to public statements by the Minister of Culture Evtim Miloshev and defends the financial condition and management results of the company.
In the document, the NDK states that the public debate should be based on “complete, accurate and verifiable factual information“, and not on “selectively cited numbers and suggestions“. The management emphasizes that their position is not aimed at confrontation, but at presenting data and documents that, in their opinion, give a real picture of the company's condition.
Depreciation is the main reason for the accounting losses
According to the management of the National Palace of Culture, the main factor for the accumulated accounting losses over the years is the high depreciation costs resulting from the way in which the company was established in 2011. After the contribution of the building stock with a balance sheet value of over 376 million leva, significant depreciation is charged annually, which reduces the financial result, without representing a real cash expense.
With 49 million euros in losses: The head of the National Palace of Culture - with a monthly salary of over 13,000 euros
The National Palace of Culture indicates that the company has been reporting accounting losses since its establishment, regardless of the changes in management and principals over the years. According to them, this problem is structural and is consistently reflected in the audit reports.
The position states that at the time of taking over management in February 2024, the company's accounts had about 7.5 million leva, while by June 2026 the funds reached approximately 16 million leva.
According to management, revenue from contracts with customers increased by 30% in 2024 compared to the previous year, and the operating loss decreased by 73%. A positive net cash flow from operating activities was also reported, after it was negative in 2023.
According to the National Palace of Culture, the company ended 2024 with EBITDA (earnings before interest, taxes, depreciation and amortization) of nearly 4 million leva, which means a positive operating result before depreciation.
The management emphasizes the fact that the National Palace of Culture does not receive government subsidies, unlike other cultural institutions such as theaters and operas. At the same time, the company maintains and manages over 135 thousand square meters of area in Sofia and Varna, paying the full amount of building tax and household waste fee.
According to the position, the costs for these obligations exceed 3 million euros per year.
Among the main priorities of this management is a project for the complete digitalization of the National Palace of Culture and the Festival and Congress Center in Varna.
The project includes seven stages - from business analysis and construction of a new network infrastructure to the creation of new websites, its own ticket system, mobile applications, ERP system, access control and staff training.
The National Palace of Culture states that its own ticket platform will allow not only the sale of tickets for the company's events, but also the provision of services to external organizers.
According to the management, several consecutive increases in employee remuneration have been implemented in the last two years - by 20% in 2024 , by 15% in 2025 and by another 15% at the beginning of 2026.
The National Palace of Culture claims that these increases are financed by the improved operational results of the company, and not through state subsidies or new debt.
The position also comments on the publicly expressed criticism regarding company cars and management remuneration.
With regard to remuneration, it is emphasized that they are determined according to the rules of the Public Enterprises Act and the applicable regulatory framework, which applies to all state-owned commercial companies in the country.
The management of the National Palace of Culture invites you to a professional dialogue with the Ministry of Culture, based on documents, financial statements and specific results.
The company states that until the last press conference of the Ministry of Culture, no working meeting had been held between the Minister and the Executive Director of the National Palace of Culture and expresses its readiness for an institutional dialogue on all questions asked.