Italian Market Holds Down Ares-Serono

The Switzerland-based company Ares-Serono posted a decline of 53% in net income in the first six months of 1994 to $18.43 million. Pretax profits were $ 39.82 million, down 33.16%.

The company said that sales were influenced by the health care reforms in Italy. Excluding this factor, sales increased 23.7% in the first half. However, strong sales growth was registered in North America, ahead 43%. The North American market represents 29% of total group sales, compared with 19% a year ago. Sales growth was impressive in Japan, ahead 68% in local currency terms. This was partly due to the successful introduction of Ares-Serono's highly purified follicle stimulating hormone Metrodin HP in that country. In Latin America, sales advanced 47% and in the Nordic countries they were up 76%. Group sales in Germany and the UK were ahead 30% and 27% respectively.

Divestment by Ares-Serono of the diagnostics division resulted in a one-time loss of $9.6 million in the second quarter of the year. Ares-Serono says that it is now focusing entirely on pharmaceuticals. The group's ongoing cost-cutting program continued to have a positive effect on other operating expenses, which were down 4.2%.