Global X MSCI China Real Estate ETF

For 2005, Chiron reported adjusted income from continuing operations of $259 million, or $1.34 per share, versus adjusted EPS of $0.67 in 2004. Total revenues increased 11% to $1.9 billion from $1.7 billion, and product sales increased 12% to $1.4 billion. Gross profit margins improved to 49% from 47%. In Vaccines, total product sales were $582 million versus $479 million in 2004, including $96 million of FLUVIRIN sales; in Blood Testing, total revenues were $556 million, up 12%; and BioPharmaceuticals product revenues were $536 million, up 5%. For 2006, management said FLUVIRIN capacity could be approximately 40 million doses for the 2006/2007 season, but did not provide formal EPS or revenue guidance.

Howard Pien framed 2005 as a difficult but productive rebuilding year, saying the company finished stronger despite missing some financial milestones, mainly because FLUVIRIN did not hit target levels. He emphasized progress across all three businesses, especially the return to the U.S. flu market, pandemic preparedness work, and advancement of the oncology pipeline. His tone was confident but measured, repeatedly stressing that 2006 should bring more normal operations, while noting that some goals and regulatory pathways were still too early to fully quantify.

David Smith focused on the year’s financial improvement and the factors behind it. He cited adjusted 2005 income from continuing operations of $259 million, or $1.34 per share, total revenue of $1.9 billion, product sales of $1.4 billion, and gross margin of 49%; he also noted R&D expense of $434 million and SG&A of $502 million. He attributed the lower effective tax rate of 11% to business mix and tax planning, and said it should not be viewed as a normal run rate going forward. He also broke out segment performance, including Blood Testing revenue of $556 million, Vaccines product sales of $582 million, and BioPharmaceuticals product revenues of $536 million.

Analysts focused on the shortfall versus prior guidance in PROCLEIX growth, the move from cost recovery to commercial pricing for the West Nile assay, FLUVIRIN pricing and demand, and the likely indications for CHIR-258 and CHIR-265. Management said PROCLEIX underperformance was mainly timing-related, due to longer close cycles and some over-optimism, and pointed to stronger fourth-quarter growth and strong ex-U.S. growth. On West Nile, they said commercial pricing would be negotiated with customers over roughly 90 days and would likely be in place before mosquito season. On the oncology compounds, Stephen Dilly said 258’s initial focus would be hematologic malignancies such as AML and myeloma, with melanoma also a lead indication for both 258 and 265.