Serono 4th qtr shows profit but disappoints

Europe's largest biotechnology company, the Switzerland-based Serono group, has reported good earnings for the fourth quarter of 2005, and a reduction in full-year losses, but product sales missed the firm's guidance of 10% year-on-year growth.

Total fourth-quarter revenues were $669.9 million, a dip of 1.4% on the like, 2004 period, with net income leaping 68.5% to $144.2 million and earnings per share 62.2% higher at $9.89. For the full year, turnover was up 5.2% at $2.57 billion, but resulting in a net loss of $105.3 million, albeit an improvement on the loss of $481.3 million the previous year. 2005's basic loss was $7.28 per bearer share and $0.18 per American Depositary Share.

Serono, which has put itself up for sale but has so far received no offers (Marketletters passim), has issued a 2006 outlook of high single-digit product sales growth and earnings per bearer share in the $42.00-$43.40 range. Chief executive Ernesto Bertarelli commented: "2005 was a year of continued growth and business expansion. Our improved operating leverage led to higher adjusted profit, while our aggressive business development strategy resulted in a stronger pipeline," adding that, "during 2006, we will maintain our focus on maximizing the potential of our marketed products, the efficiency of our business operations the the advancement of our most promising clinical programs."