SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the month of July, 2003
Serono S.A.
-----------------------------------
(Registrant's Name)
15 bis, Chemin des Mines
Case Postale 54
CH-1211 Geneva 20
Switzerland
-----------------------------------
(Address of Principal Executive Offices)
1-15096
-----------------------------------
(Commission File No.)
(Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F.)
Form 20-F X Form 40-F
--- ---
(Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101 (b)(1).) ______
(Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101 (b)(7).) ______
(Indicate by check mark whether the registrant by furnishing the
information contained in this form is also thereby furnishing the information to
the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.)
Yes No X
--- ---
(If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b): 82-______)
SERONO
Media Release
FOR IMMEDIATE RELEASE
-----------------------
--------------------------------------------------------------------------------
SERONO ANNOUNCES STRONG SECOND QUARTER RESULTS
AND RAISES GUIDANCE FOR 2003
- Revenues up 33.8% to Over Half a Billion Dollars
Driven by Rebif(R) Sales Growth of 62.3% -
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GENEVA, SWITZERLAND, JULY 24, 2003 - Serono S.A. (virt-x: SEO and NYSE: SRA)
today reported its second quarter results for the period ended June 30, 2003.
HIGHLIGHTS
- Total revenues of $508.4m up 33.8% in dollars and 21.2% in local currencies
- Product sales up 33.2% to $467.4m
- Significant growth in all therapeutic areas: +67.6% in Neurology, +9.7% in
Reproductive Health and +15.5% in Growth and Metabolism
- Reported net income of $107.7m, up 13.2% in dollars and 7.8% in local
currencies
- Basic EPS up 15.0% to $6.81 per Bearer Share and $0.17 per American
Depositary Share
- 2003 guidance raised to a target of 20% total revenue growth and 20% net
income growth on a reported basis
- Good progress in R&D: onercept moving into Phase 3 based on excellent Phase
2 results, emfilermin in Phase 2, IL-18 binding protein in Phase 2a and
oxytocin receptor antagonist in Phase 1
"Our second quarter results reflect the underlying strength of our company,"
said Ernesto Bertarelli, Chief Executive Officer. "We are very pleased with the
growth in all parts of our business and are looking forward to strong
performance in the second half of the year."
"Given the solid performance of our business from top to bottom, we are raising
our 2003 guidance to a target of 20% revenue growth and 20% net income growth on
a reported basis," said Allan Shaw, Chief Financial Officer.
-more-
FINANCIAL PERFORMANCE
In the second quarter of 2003, total revenues grew by 33.8% to $508.4m (Q2 2002:
$380.1m). Product sales rose 33.2% to $467.4m (Q2 2002: $350.8m). As the US
dollar continued to be relatively weak in the second quarter, there was a
positive currency impact of $41.5m on product sales. In local currencies,
product sales grew by 20.4%.
Royalty and license income grew 40.4% to $41.0m (Q2 2002: $29.2m) due to
Serono's strong intellectual property rights, and now represents 8.1% of
revenues. This increase included higher royalties and a one-time license
payment.
Gross margin was 84.8% as a result of the growth of recombinant product sales.
Selling, general and administrative expenses were $158.1m or 31.1% of total
revenues (Q2 2002: $125.6m or 33.0% of total revenues), reflecting the
improvement in the company's operating leverage.
Research and development activities made good progress and expenses were $108.5m
or 21.3% of total revenues (Q2 2002: $85.7m or 22.6% of total revenues).
In the second quarter, other operating expenses reached $50.9m (Q2 2002: $15.1m)
influenced by the Novantrone(R) licensing agreement, signed in late 2002, and
overall higher amortization of intangibles.
Operating income grew by 14.9% to $120.0m reflecting continuing cost-control
management. Net financial income was $7.0m in the second quarter (Q2 2002:
$9.5m) as a result of the continuing low interest rate environment.
Reported net income grew 13.2% to $107.7m (Q2 2002: $95.2m), or 7.8% in local
currencies.
Reported basic earnings per share (EPS) grew 15.0% to $6.81 per bearer share (Q2
2002: $5.92) and $0.17 per American Depositary Share (ADS) (Q2 2002: $0.15). The
average number of equivalent bearer shares outstanding for the three months
ended June 30, 2003 was 15,824,571.
NEUROLOGY
In the second quarter of 2003, total neurology sales were $205.5m. Rebif(R)
worldwide sales were up 62.3% (42.2% in local currencies) to $199.0m (Q2 2002:
$122.6m). Rebif(R) continued its market leadership outside the United States
with sales up by 42.0% to $156.8m (Q2 2002: $110.4m).
In the USA, Rebif(R) sales were $42.2m in the second quarter (Q2 2002: $12.2m)
with demand continuing to strengthen and prescriptions growing at 17.8% from the
first quarter of 2003. Rebif(R) is the fastest growing MS disease modifying drug
and is rapidly gaining market share in the USA. Rebif(R) IMS market share was
10.5% in total prescriptions and 15.2% in new prescriptions at the end of June.
-more-
In May, Serono and Pfizer announced(1) that the final 63-week findings from the
Rebif(R) (interferon beta-1a) vs. Avonex(R) (interferon beta-1a) EVIDENCE
head-to-head study show that Rebif(R) continues to be significantly more
effective in reducing frequency of relapses and MRI activity as compared to
Avonex(R). In June, Serono and Pfizer announced(1) that MS patients converting
from Avonex(R) to Rebif(R) showed significant reduction in frequency of relapses
and MRI lesion activity. These data were presented at the annual meetings of the
Consortium of MS Centers and the European Neurological Society respectively.
REPRODUCTIVE HEALTH
In the second quarter, worldwide reproductive health product sales increased by
9.7% to $183.4m (Q2 2002: $167.1m). Sales of Gonal-F(R) grew by 13.0% (2.9% in
local currencies) to $139.5m (Q2 2002: $123.5m) reflecting the popularity of the
multidose formulation and Serono's leadership position in this therapeutic area.
Serono's core reproductive health portfolio consisting of three recombinant
hormones (Gonal-F(R), Ovidrel(R), Luveris(R)) and two supporting products
(Cetrotide(R), Crinone(R)) grew by 18.3% to $155.7m. In keeping with the plan of
phasing out urinary products, urine-derived gonadotropins sales were $25.3m in
the second quarter (Q2 2002: $32.6m).
In June, positive results were announced at the European Society for Human
Reproduction and Embryology congress from a proof of concept clinical trial of
emfilermin (r-hLIF) for improving embryo implantation. These promising results
give significant hope to couples facing recurrent embryo implantation problems
following in vitro fertilization as they provide evidence of the potential
impact of emfilermin on their chance to become pregnant.
GROWTH AND METABOLISM
Sales of Serono's recombinant growth hormone products rose by 15.5% to $62.2m in
the second quarter (Q2 2002: $53.9m). Saizen(R) sales increased by 32.9% (18.2%
in local currencies) to $39.2m (Q2 2002: $29.5m). The favorable reception of the
needle-free device, cool.click(TM), across Europe and its market acceptance in
the USA continue to make it a popular choice with prescribers and patients.
Serostim(R) sales continue to be relatively stable at $23.0m (Q2 2002: $24.3m).
REGIONAL SALES
In Europe, sales increased by 36.9% to $203.4m (Q2 2002: $148.6m). Sales in
North America were $172.5m growing at 43.6% (Q2 2002: $120.1m). In the rest of
the world, sales grew by 11.4% to $91.5m (Q2 2002: $82.1m).
_______________________________
(1) For further information about the results of these studies, please refer to
our press releases dated May 30, 2003 and June 18, 2003 which have been
provided to the U.S. Securities and Exchange Commission under cover of FORM
6-K on May 30, 2003 and June 18, 2003 respectively.
-more-
R&D NEWS
In the second quarter of 2003, significant progress was made in product
development and the following R&D programs reached significant development
milestones:
- following the announcement of positive Phase 2 results for onercept
(r-hTBP-1) in psoriasis at the 9th International Psoriasis Symposium
in June, we plan to initiate Phase 3 later this year;
- based on the results of the Phase 2 trial with interferon beta-1a in
patients with ulcerative colitis, a Phase 2b study is planned to start
in the second half of the year;
- based on the outcome of a Phase 2 study of onercept in Crohn's
disease, it is planned to initiate a Phase 2b study by the end of the
year;
- following the interim analysis of a Phase 2 study of interferon
beta-1a in Crohn's disease, no further studies are planned;
- a Phase 2 study with emfilermin (r-hLIF) focusing on recurrent embryo
implantation problems in IVF was initiated during the second quarter;
- a Phase 1 program was started with an oxytocin receptor antagonist for
pre-term labor;
- IL-18 binding protein recently moved into Phase 2a in psoriasis.
# # # #
-more-
CONFERENCE CALL AND WEBCAST
Serono will hold a conference call today, July 24, 2003, starting at 3.30 pm
Central European Time (9.30 am U.S. Eastern Time) during which Serono Management
will present the Company's Second Quarter 2003 Results. To join the telephone
conference please dial 091 610 5600 (from Switzerland), 0207 107 0611 (from the
UK), 1 866 291 4166 (from the USA) and +41 91 610 5600 (from elsewhere).
Telephone playback will be available one hour after the conference call and
until close of business 5.00 pm CET on July 30, 2003. To access this playback
please dial the following numbers: 091 612 4330 (from Switzerland), 0207 866
4300 (from the UK), 1 412 858 1440 (from the USA) and +41 91 612 4330 (from
elsewhere) and enter the PIN code 239# from a touch tone telephone.
The event will also be relayed by live audio webcast that interested parties may
access via Serono's Corporate home page, www.serono.com. A link to the webcast
will be provided immediately prior to the event, and accompanying slides will be
made available for download approximately 1 hour before the beginning of the
webcast. Additionally, the webcast will be available for replay until close of
business on August 15, 2003.
###
Some of the statements in this press release are forward looking. Such
statements are inherently subject to known and unknown risks, uncertainties and
other factors that may cause actual results, performance or achievements of
Serono S.A. and affiliates to be materially different from those expected or
anticipated in the forward-looking statements. Forward-looking statements are
based on Serono's current expectations and assumptions, which may be affected by
a number of factors, including those discussed in this press release and more
fully described in Serono's Annual Report on Form 20-F filed with the U.S.
Securities and Exchange Commission on April 17, 2003. These factors include any
failure or delay in Serono's ability to develop new products, any failure to
receive anticipated regulatory approvals, any problems in commercializing
current products as a result of competition or other factors, our ability to
obtain reimbursement coverage for our products, and government regulations
limiting our ability to sell our products. Serono has no responsibility to
update the forward-looking statements contained in this press release to reflect
events or circumstances occurring after the date of this press release.
###
-more-
ABOUT SERONO
Serono is a global biotechnology leader. The Company has six recombinant
products on the market, Gonal-F(R), Luveris(R), Ovidrel(R)/Ovitrelle(R),
Rebif(R), Serostim(R) and Saizen(R) (Luveris(R) is not approved in the USA). In
addition to being the world leader in reproductive health, Serono has strong
market positions in neurology, metabolism and growth. The Company's research
programs are focused on growing these businesses and on establishing new
therapeutic areas. Currently, there are over 30 projects in development.
Serono was awarded the International James D. Watson Helix 2003 Award from the
Biotechnology Industry Organization (BIO) in recognition of the Company's
outstanding leadership and highest standards of scientific and product
achievement.
In 2002, Serono achieved worldwide revenues of US$1.546 billion, and a net
income of US$321 million, making it the third largest biotech company in the
world. The Company operates in 45 countries, and its products are sold in over
100 countries. Bearer shares of Serono S.A., the holding company, are traded on
the virt-x (SEO) and its American Depositary Shares are traded on the New York
Stock Exchange (SRA).
FOR MORE INFORMATION, PLEASE CONTACT:
SERONO IN GENEVA, SWITZERLAND:
MEDIA RELATIONS: INVESTOR RELATIONS:
Tel: +41-22-739 36 00 Tel: +41-22-739 36 01
Fax: +41-22-739 30 85 Fax: +41-22-739 30 22
http://www.serono.com Reuters: SEOZ.VX / SRA.N
---------------------
Bloomberg: SEO VX / SRA US
SERONO, INC., ROCKLAND, MA
MEDIA RELATIONS: INVESTOR RELATIONS:
Tel. +1 781 681 2340 Tel. +1 781 681 2552
Fax: +1 781 681 2935 Fax: +1 781 681 2912
http://www.seronousa.com
------------------------
On the following pages, there are:
- Tables detailing sales in dollars by therapeutic area, geographic
region and the top 10 products for the 3 and 6 months ended June 30,
2003.
- The unaudited consolidated financial statements for the 3 and 6 months
ended June 30, 2003, including income statements, balance sheets and
statements of cash flows, prepared in accordance with International
Financial Reporting Standards (IFRS).
-more-
SALES BY THERAPEUTIC AREA
-------------------------
THREE MONTHS ENDED THREE MONTHS ENDED
JUNE 30, 2003 JUNE 30, 2002
$ MILLION % OF SALES % CHANGE $ $MILLION % OF SALES
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Neurology 205.5 44.0% 67.6% 122.6 34.9%
Reproductive Health 183.4 39.2% 9.7% 167.1 47.6%
Growth & Metabolism 62.2 13.3% 15.5% 53.9 15.4%
Others 16.3 3.5% 125.8% 7.2 2.1%
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Total sales (US$million) $ 467.4 100% 33.2% $ 350.8 100%
SALES BY GEOGRAPHIC REGION
--------------------------
THREE MONTHS ENDED THREE MONTHS ENDED
JUNE 30, 2003 JUNE 30, 2002
$ MILLION % OF SALES % CHANGE $ $MILLION % OF SALES
--------------------------------------------------------------------------------------------
Europe 203.4 43.5% 36.9% 148.6 42.3%
North America 172.5 36.9% 43.6% 120.1 34.2%
Latin America 25.5 5.5% (16.5%) 30.5 8.7%
Others 66.0 14.1% 27.9% 51.6 14.8%
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Total sales (US $million) $ 467.4 100% 33.2% $ 350.8 100%
SALES BY THERAPEUTIC AREA
-------------------------
SIX MONTHS ENDED SIX MONTHS ENDED
JUNE 30, 2003 JUNE 30, 2002
$ MILLION % OF SALES % CHANGE $ $MILLION % OF SALES
--------------------------------------------------------------------------------------------
Neurology 385.9 44.1% 62.2% 237.9 35.8%
Reproductive Health 344.0 39.3% 11.5% 308.5 46.4%
Growth & Metabolism 115.2 13.2% 11.6% 103.2 15.5%
Others 30.1 3.4% 103.5% 14.8 2.3%
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Total sales (US$ million) $ 875.2 100% 31.7% $ 664.4 100%
SALES BY GEOGRAPHIC REGION
--------------------------
SIX MONTHS ENDED SIX MONTHS ENDED
JUNE 30, 2003 JUNE 30, 2002
$ MILLION % OF SALES % CHANGE $ $MILLION % OF SALES
--------------------------------------------------------------------------------------------
Europe 389.0 44.5% 34.1% 290.0 43.7%
North America 321.7 36.8% 49.3% 215.4 32.4%
Latin America 41.0 4.7% (28.7%) 57.4 8.6%
Others 123.5 14.0% 21.6% 101.6 15.3%
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Total sales (US$ million) $ 875.2 100% 31.7% $ 664.4 100%
-more-
TOP TEN PRODUCTS
THREE MONTHS ENDED THREE MONTHS ENDED
JUNE 30, 2003 JUNE 30, 2002
--------------------------------------------------------------------------
* TA $ MILLION % OF SALES % CHANGE $ $ MILLION % OF SALES
Rebif(R) MS 199.0 42.6% 62.3% 122.6 34.9%
Gonal-F(R) RH 139.5 29.9% 13.0% 123.5 35.2%
Saizen(R) Growth 39.2 8.4% 32.9% 29.5 8.4%
Serostim(R) Wasting 23.0 4.9% (5.6%) 24.3 6.9%
Novantrone(R) MS/Oncology 15.6 3.3% 100.0% --
Pergonal(R) RH 11.9 2.5% (0.5%) 11.9 3.4%
Metrodin HP(R) RH 7.2 1.5% (49.8%) 14.3 4.1%
Cetrotide(R) RH 5.9 1.3% 27.0% 4.6 1.3%
Profasi(R) RH 5.1 1.1% (1.9%) 5.2 1.5%
Crinone(R) RH 4.8 1.0% 642.8% 0.6 0.2%
SIX MONTHS ENDED SIX MONTHS ENDED
JUNE 30, 2003 JUNE 30, 2002
--------------------------------------------------------------------------
* TA $ MILLION % OF SALES % CHANGE $ $ MILLION % OF SALES
Rebif(R) MS 374.2 42.8% 57.3% 237.9 35.8%
Gonal-F(R) RH 261.5 29.9% 16.4% 224.7 33.8%
Saizen(R) Growth 72.3 8.3% 22.6% 59.0 8.9%
Serostim(R) Wasting 42.9 4.9% (3.0%) 44.2 6.7%
Novantrone(R) MS/Oncology 28.4 3.2% 100.0% --
Pergonal(R) RH 22.2 2.5% 7.0% 20.7 3.1%
Metrodin HP(R) RH 14.3 1.6% (49.5%) 28.3 4.3%
Cetrotide(R) RH 11.5 1.3% 38.5% 8.3 1.2%
Crinone(R) RH 9.2 1.1% 142.5% 3.8 0.6%
Profasi(R) RH 8.8 1.0% (13.7%) 10.1 1.5%
* THERAPEUTIC AREAS
RH = Reproductive Health Wasting = AIDS Wasting
MS = Multiple Sclerosis Growth = Growth Retardation
Oncology = Oncology
-more-
CONSOLIDATED INCOME STATEMENTS
SIX MONTHS ENDED JUNE 30 2003 * % OF 2002 * % of
US$'000 REVENUES % change US$'000 Revenues
Revenues
Product sales 875,200 31.7% 664,367
Royalty and license income 75,633 31.4% 57,577
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TOTAL REVENUES 950,833 100.0% 31.7% 721,944 100.0%
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Operating Expenses
Cost of product sales 133,448 33.5% 99,953
% of Sales 15.2% 15.0%
Selling, general and administrative 299,040 31.5% 23.6% 241,892 33.5%
Research and development 236,469 24.9% 46.5% 161,369 22.4%
Other operating expense, net 96,699 10.2% 179.8% 34,558 4.8%
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Total Operating Expenses 765,656 80.5% 42.4% 537,772 74.5%
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OPERATING INCOME 185,177 19.5% 0.5% 184,172 25.5%
-----------------------------------------------------------------------------------------------------
Financial income, net 15,404 9.0% 14,132
Other income/(expense), net (367) 1,177
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Total Non Operating Income, Net 15,771 12,955
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Income Before Taxes and Minority Interests 200,948 21.1% 1.9% 197,127 27.3%
Taxes 32,151 32,527
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Income Before Minority Interests 168,797 164,600
Minority interests 901 (55)
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NET INCOME 167,896 17.7% 2.0% 164,655 22.8%
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* Unaudited
2003 2002 % CHANGE
Basic Earnings per Share (in U.S. dollars)
--------------------------------------------------------------------------------
- Bearer shares 10.60 10.24 3.5%
--------------------------------------------------------------------------------
- Registered shares 4.24 4.10 3.5%
--------------------------------------------------------------------------------
- American depositary shares 0.27 0.26 3.5%
--------------------------------------------------------------------------------
Diluted Earnings per Share (in U.S. dollars)
--------------------------------------------------------------------------------
- Bearer shares 10.59 10.23 3.6%
--------------------------------------------------------------------------------
- Registered shares 4.24 4.09 3.6%
--------------------------------------------------------------------------------
- American depositary shares 0.26 0.26 3.6%
--------------------------------------------------------------------------------
Basic earnings per share are calculated in accordance with IAS 33 (Earnings per
Share) by dividing the net income of the group, US$167.9 million (2002 US$164.7
million), by an appropriate number of shares. This is 11,431,665 bearer shares
(2002 11,671,577) and 11,013,040 registered shares (2002 11,013,040). The total
weighted average equivalent number of bearer shares is 15,836,881 (2002
16,076,793) for the six months ended June 30, 2003. As each American depositary
share represents ownership interest in one fortieth of a bearer share, basic and
diluted earnings per American depositary share is calculated as one fortieth of
the earnings per bearer share.
For diluted earnings per share, the total number of bearer shares is adjusted to
assume conversion of all share options granted to employees and directors. The
number of bearer shares used to calculate diluted earnings per share is
11,445,711 (2002 11,691,862).
-more-
CONSOLIDATED INCOME STATEMENTS
THREE MONTHS ENDED JUNE 30 2003 * % OF 2002 * % of
US$'000 REVENUES % change US$'000 Revenues
Revenues
Product sales 467,414 33.2% 350,835
Royalty and license income 41,013 40.4% 29,218
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TOTAL REVENUES 508,427 100.0% 33.8% 380,053 100.0%
-----------------------------------------------------------------------------------------------------
Operating Expenses
Cost of product sales 70,817 44.0% 49,193
% of Sales 15.2% 14.0%
Selling, general and administrative 158,124 31.1% 25.9% 125,552 33.0%
Research and development 108,532 21.3% 26.6% 85,733 22.6%
Other operating expense, net 50,948 10.0% 236.8% 15,128 4.0%
-----------------------------------------------------------------------------------------------------
Total Operating Expenses 388,421 76.4% 40.9% 275,606 72.5%
-----------------------------------------------------------------------------------------------------
OPERATING INCOME 120,006 23.6% 14.9% 104,447 27.5%
-----------------------------------------------------------------------------------------------------
Financial income, net 7,022 (26.2%) 9,519
Other income/(expense), net (1,866) 634
-----------------------------------------------------------------------------------------------------
Total Non Operating Income, Net 8,888 8,885
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Income Before Taxes and Minority Interests 128,894 25.4% 13.7% 113,332 29.8%
Taxes 20,622 18,282
-----------------------------------------------------------------------------------------------------
Income Before Minority Interests 108,272 95,050
Minority interests 534 (128)
-----------------------------------------------------------------------------------------------------
NET INCOME 107,738 21.2% 13.2% 95,178 25.0%
-----------------------------------------------------------------------------------------------------
* Unaudited
2003 2002 % CHANGE
Basic Earnings per Share (in U.S. dollars)
--------------------------------------------------------------------------------
- Bearer shares 6.81 5.92 15.0%
--------------------------------------------------------------------------------
- Registered shares 2.72 2.37 15.0%
--------------------------------------------------------------------------------
- American depositary shares 0.17 0.15 15.0%
--------------------------------------------------------------------------------
Diluted Earnings per Share (in U.S. dollars)
--------------------------------------------------------------------------------
- Bearer shares 6.80 5.91 15.0%
--------------------------------------------------------------------------------
- Registered shares 2.72 2.37 15.0%
--------------------------------------------------------------------------------
- American depositary shares 0.17 0.15 15.0%
--------------------------------------------------------------------------------
Basic earnings per share are calculated in accordance with IAS 33 (Earnings per
Share) by dividing the net income of the group, US$107.7 million (2002 US$95.2
million), by an appropriate number of shares. This is 11,419,355 bearer shares
(2002 11,672,296) and 11,013,040 registered shares (2002 11,013,040). The total
weighted average equivalent number of bearer shares is 15,824,571 (2002
16,077,512) for the three months ended June 30, 2003. As each American
depositary share represents ownership interest in one fortieth of a bearer
share, basic and diluted earnings per American depositary share is calculated as
one fortieth of the earnings per bearer share.
For diluted earnings per share, the total number of bearer shares is adjusted to
assume conversion of all share options granted to employees and directors. The
number of bearer shares used to calculate diluted earnings per share is
11,440,499 (2002 11,691,779).
-more-
CONSOLIDATED BALANCE SHEETS
As of JUNE 30, 2003 * December 31, 2002
US$000 US$000
ASSETS
Current Assets
Cash and cash equivalents 578,131 686,033
Short-term financial assets 495,940 378,865
Trade accounts receivable 315,923 257,313
Inventories 294,397 259,477
Prepaid expenses 39,568 26,609
Other current assets 188,206 208,100
----------------------------------------------------------------------------------------------------
Total Current Assets 1,912,165 1,816,397
----------------------------------------------------------------------------------------------------
Long-Term Assets
Property, plant and equipment 616,573 554,509
Long-term financial assets 713,370 711,201
Intangible assets 250,780 230,117
Deferred tax assets 178,156 136,687
Other long-term assets 37,034 45,763
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Total Long-Term Assets 1,795,913 1,678,277
----------------------------------------------------------------------------------------------------
TOTAL ASSETS 3,708,078 3,494,674
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LIABILITIES
Current Liabilities
Bank advances 39,666 70,093
Trade accounts payable 53,067 60,591
Current portion of long-term debt 19,241 23,505
Income taxes 29,150 55,152
Deferred income - current 40,007 18,221
Other current liabilities 374,765 330,483
----------------------------------------------------------------------------------------------------
Total Current Liabilities 555,896 558,045
----------------------------------------------------------------------------------------------------
Long-Term Liabilities
Long-term debt 38,638 25,857
Deferred tax liabilities 11,509 12,080
Deferred income - non-current 198,114 183,659
Other long-term liabilities 327,939 252,670
----------------------------------------------------------------------------------------------------
Total Long-Term Liabilities 576,200 474,266
----------------------------------------------------------------------------------------------------
Total Liabilities 1,132,096 1,032,311
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
Minority Interests 2,121 1,165
----------------------------------------------------------------------------------------------------
SHAREHOLDERS' EQUITY
Share capital 253,866 253,416
Share premium 1,002,400 989,141
Treasury shares (147,526) (126,460)
Retained earnings 1,446,814 1,364,626
Fair value reserves (36,427) (44,807)
Cumulative foreign currency translation adjustments 54,734 25,282
----------------------------------------------------------------------------------------------------
Total Shareholders' Equity 2,573,861 2,461,198
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
Total Liabilities, Minority Interests and Shareholders' Equity 3,708,078 3,494,674
----------------------------------------------------------------------------------------------------
* Unaudited
-more-
CONSOLIDATED STATEMENTS OF CASH FLOWS
Six months ended June 30 2003 * 2002 *
US$000 US$000
Cash Flows From Operating Activities
Income before taxes and minority interests 200,948 197,127
Depreciation and amortization 67,514 48,576
Financial income (24,964) (33,280)
Financial expense 11,325 4,854
Other non-cash items 37,641 (78)
--------------------------------------------------------------------------------------------
Cash Flows From Operating Activities Before Working Capital Changes 292,464 217,199
--------------------------------------------------------------------------------------------
Working Capital Changes
Trade accounts payable, other current liabilities and deferred income 33,728 (24,301)
Trade accounts receivable (50,599) (33,252)
Inventories (31,605) (26,862)
Prepaid expenses and other current assets (5,115) (7,112)
Taxes paid (53,651) (35,989)
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NET CASH FLOWS FROM OPERATING ACTIVITIES 185,222 89,683
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Cash Flows From Investing Activities
Purchase of property, plant and equipment (90,301) (48,676)
Purchase of intangible and other long-term assets (7,145) (7,038)
Purchase of financial assets (113,747) (384,020)
Other non-current liabilities (9,444) (6,133)
Proceeds from sale of property, plant and equipment 2,689 10,268
Interest received 44,424 17,307
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Net Cash Flows From Investing Activities (173,524) (418,292)
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Cash Flows From Financing Activities
Proceeds from issuance of share capital 13,105 11,611
Proceeds from exercises of stock options 470 1,205
Premiums received on written calls 508 --
Purchase of treasury shares (24,637) (1,103)
Repayment of bank advances (30,983) (55,962)
Repayment of long-term debt 7,016 (8,672)
Interest paid (2,599) (4,219)
Dividends paid (85,709) (64,240)
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Net Cash Flows From Financing Activities (122,829) (121,380)
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Effect of Exchange Rate Changes on Cash and Cash Equivalents 3,229 13,341
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Net Increase in Cash and Cash Equivalents (107,902) (436,648)
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Cash and Cash Equivalents
- Beginning of period 686,033 1,131,091
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- End of period 578,131 694,443
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* Unaudited
-end-
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
SERONO S.A.
a Swiss corporation
(Registrant)
July 24, 2003 By: /s/ Allan Shaw
-----------------------------------
Name: Allan Shaw
Title: Chief Financial Officer