Johnson & Johnson Reports 2010 First-Quarter Results:
Sales of $15.6 Billion Increased 4.0% Versus 2009 First Quarter; EPS was $1.62
Excluding Special Items, 2010 First-Quarter EPS was $1.29, an increase of 2.4%*
NEW BRUNSWICK, N.J., April 20 /PRNewswire-FirstCall/ -- Johnson & Johnson (NYSE: JNJ) today announced sales of $15.6 billion for the first quarter of 2010, an increase of 4.0% as compared to the first quarter of 2009. Operational results declined 0.1% and the positive impact of currency was 4.1%. Domestic sales declined 5.0%, while international sales increased 14.4%, reflecting operational growth of 5.5% and a positive currency impact of 8.9%.
Net earnings and diluted earnings per share for the first quarter of 2010 were $4.5 billion and $1.62, respectively. First-quarter 2010 net earnings included an after-tax gain of $910 million representing the net impact of litigation matters. Excluding this special item, net earnings for the current quarter were $3.6 billion and diluted earnings per share were $1.29, representing increases of 3.1% and 2.4%, respectively, as compared to the same period in 2009.* The Company updated its earnings guidance for full-year 2010 to $4.80 - $4.90 per share to reflect recent changes in foreign currency exchange rates. Earnings guidance excludes the impact of special items and now incorporates the impact of recently enacted health care reform legislation.
"Thanks to the outstanding efforts of our people, we were able to deliver solid financial results," said William C. Weldon, Chairman and Chief Executive Officer. "This was accomplished despite a major product recall and the continued impact of patent expirations. We are well positioned for future growth."
Worldwide Consumer sales of $3.8 billion for the first quarter represented an increase of 1.5% versus the prior year consisting of a decrease of 3.7% operationally and a positive impact from currency of 5.2%. Domestic sales decreased 9.6%; international sales increased 11.1%, which reflected an operational increase of 1.4% and a positive currency impact of 9.7%.
Positive contributors to operational results were NEUTROGENA®, AVEENO® and LE PETIT MARSEILLAIS® skin care products; ZYRTEC® over-the-counter allergy treatment; international sales of LISTERINE® antiseptic mouthrinse; and women's sanitary protection products. These operational sales increases were more than offset by the impact of the previously announced recall of selected OTC products as well as the devaluation of the Venezuelan currency.
Worldwide Pharmaceutical sales of $5.6 billion for the first quarter represented a decrease of 2.5% versus the prior year consisting of an operational decline of 5.7% and a positive impact from currency of 3.2%. Domestic sales decreased 12.7%; international sales increased 15.5%, which reflected an operational increase of 6.6% and a positive currency impact of 8.9%.
Products with strong operational growth included REMICADE® (infliximab), a biologic approved for the treatment of a number of immune mediated inflammatory diseases; PREZISTA® (darunavir), a treatment for HIV; VELCADE® (bortezomib), a treatment for multiple myeloma; and international sales of RISPERDAL® CONSTA® (risperidone) Long-Acting Treatment, an antipsychotic medication. Strong growth was also achieved from newly launched products including STELARATM (ustekinumab), a biologic approved for the treatment of moderate to severe plaque psoriasis; and SIMPONITM (golimumab), a biologic approved to treat adults with moderate to severe rheumatoid arthritis, psoriatic arthritis, and ankylosing spondylitis.
Sales results of TOPAMAX® (topiramate), an antiepileptic and a treatment for migraine, and RISPERDAL® (risperidone), an antipsychotic medication, were negatively impacted by generic competition.
Worldwide Medical Devices and Diagnostics sales of $6.2 billion for the first quarter represented an increase of 12.5% versus the prior year consisting of an operational increase of 8.1% and a positive currency impact of 4.4%. Domestic sales increased 8.8%; international sales increased 15.9%, which reflected an operational increase of 7.5% and a positive currency impact of 8.4%.
Primary contributors to operational growth included Ethicon's surgical care products; DePuy's orthopaedic joint reconstruction and sports medicine businesses; Ethicon Endo-Surgery's minimally invasive products and Advanced Sterilization Products' infection prevention solutions; and Ortho-Clinical Diagnostics' professional products. This growth was partially offset by lower sales in the Cordis franchise, reflecting continued competition in the drug-eluting stent market.
During the quarter, the Company filed for CE Mark in Europe for its NEVO® Sirolimus-Eluting Coronary Stent, the first drug-eluting stent to utilize RES TECHNOLOGYTM , eliminating the need for surface coated and permanent polymers.
About Johnson & Johnson
Caring for the world, one person at a time...inspires and unites the people of Johnson & Johnson. We embrace research and science - bringing innovative ideas, products and services to advance the health and well-being of people. Our approximately 114,000 employees at more than 250 Johnson & Johnson companies work with partners in health care to touch the lives of over a billion people every day, throughout the world.
* Net earnings and diluted earnings per share excluding special items, such as the net impact of litigation gains, are non-GAAP financial measures and should not be considered replacements for GAAP results. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measure can be found in the Investor Relations section of the Company's website at www.jnj.com.
NOTE TO INVESTORS
Johnson & Johnson will conduct a conference call with financial analysts to discuss this news release today at 8:30 a.m., Eastern Time. A simultaneous webcast of the meeting for investors and other interested parties may be accessed by visiting the Johnson & Johnson website at www.investor.jnj.com. A replay and podcast will be available approximately two hours after the live webcast by visiting www.investor.jnj.com.
Copies of the financial schedules accompanying this press release are available at www.investor.jnj.com/historical-sales.cfm. These schedules include supplementary sales data, a condensed consolidated statement of earnings, and sales of key products/franchises. Additional information on Johnson & Johnson, including a pharmaceutical pipeline of selected compounds in late stage development and medical devices and diagnostics pipeline of selected products, can be found on the Company's website at www.jnj.com
(This press release contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations of future events. If underlying assumptions prove inaccurate or unknown risks or uncertainties materialize, actual results could vary materially from Johnson & Johnson's expectations and projections. Risks and uncertainties include general industry conditions and competition; economic conditions, such as interest rate and currency exchange rate fluctuations; technological advances and patents attained by competitors; challenges inherent in new product development, including obtaining regulatory approvals; domestic and foreign health care reforms and governmental laws and regulations; and trends toward health care cost containment. A further list and description of these risks, uncertainties and other factors can be found in Exhibit 99 of Johnson & Johnson's Annual Report on Form 10-K for the fiscal year ended January 3, 2010. Copies of this Form 10-K, as well as subsequent filings, are available online at www.sec.gov, www.jnj.com or on request from Johnson & Johnson. Johnson & Johnson does not undertake to update any forward-looking statements as a result of new information or future events or developments.)
Johnson & Johnson and Subsidiaries
Supplementary Sales Data
(Unaudited; Dollars in Millions)
FIRST QUARTER
Percent Change
2010
2009
Total
Operations
Currency
Sales to customers by segment of business
Consumer
U.S.
1,560
1,726
(9.6)
%
(9.6)
-
International
2,206
1,985
11.1
1.4
9.7
3,766
3,711
1.5
(3.7)
5.2
Pharmaceutical
U.S.
3,206
3,674
(12.7)
(12.7)
-
International
2,432
2,106
15.5
6.6
8.9
5,638
5,780
(2.5)
(5.7)
3.2
Med Devices & Diagnostics
U.S.
2,886
2,652
8.8
8.8
-
International
3,341
2,883
15.9
7.5
8.4
6,227
5,535
12.5
8.1
4.4
U.S.
7,652
8,052
(5.0)
(5.0)
-
International
7,979
6,974
14.4
5.5
8.9
Worldwide
$ 15,631
15,026
4.0
%
(0.1)
4.1
Johnson & Johnson and Subsidiaries
Supplementary Sales Data
(Unaudited; Dollars in Millions)
FIRST QUARTER
Percent Change
2010
2009
Total
Operations
Currency
Sales to customers by geographic area
U.S.
$ 7,652
8,052
(5.0)
%
(5.0)
-
Europe
4,102
3,671
11.7
4.6
7.1
Western Hemisphere excluding U.S.
1,280
1,062
20.5
3.5
17.0
Asia-Pacific, Africa
2,597
2,241
15.9
7.8
8.1
International
7,979
6,974
14.4
5.5
8.9
Worldwide
$ 15,631
15,026
4.0
%
(0.1)
4.1
Johnson & Johnson and Subsidiaries
Condensed Consolidated Statement of Earnings
(Unaudited; in Millions Except Per Share Figures)
FIRST QUARTER
2010
2009
Percent
Percent
Percent
Increase
Amount
to Sales
Amount
to Sales
(Decrease)
Sales to customers
$ 15,631
100.0
$ 15,026
100.0
4.0
Cost of products sold
4,528
29.0
4,251
28.3
6.5
Selling, marketing and administrative expenses
4,779
30.5
4,608
30.7
3.7
Research expense
1,557
10.0
1,518
10.1
2.6
Interest (income)expense, net
81
0.5
81
0.5
Other (income)expense, net
(1,594)
(10.2)
(75)
(0.5)
Earnings before provision for taxes on income
6,280
40.2
4,643
30.9
35.3
Provision for taxes on income
1,754
11.2
1,136
7.6
54.4
Net earnings
$ 4,526
29.0
$ 3,507
23.3
29.1
Net earnings per share (Diluted)
$ 1.62
$ 1.26
28.6
Average shares outstanding (Diluted)
2,797.3
2,789.8
Effective tax rate
27.9 %
24.5 %
Adjusted earnings before provision for taxes and net earnings
Earnings before provision for taxes on income
$ 4,783
(1)
30.6
$ 4,643
30.9
3.0
Net earnings
$ 3,616
(1)
23.1
$ 3,507
23.3
3.1
Net earnings per share (Diluted)
$ 1.29
(1)
$ 1.26
2.4
Effective tax rate
24.4%
24.5%
(1) The difference between as reported earnings and as adjusted earnings before provision for taxes on income, net earnings and net earnings per share (diluted) is the exclusion of income from net litigation of $1,497 million, $910 million and $0.33 per share, respectively.
REPORTED SALES vs. PRIOR PERIOD ($MM)
FIRST QUARTER
% Change
2010
2009
Reported
Operational (1)
Currency
CONSUMER SEGMENT (2)
SKIN CARE
US
452
423
6.9%
6.9%
-
Intl
468
419
11.7%
2.4%
9.3%
WW
920
842
9.3%
4.6%
4.7%
BABY CARE
US
103
102
1.0%
1.0%
-
Intl
426
387
10.1%
1.2%
8.9%
WW
529
489
8.2%
1.2%
7.0%
ORAL CARE
US
174
188
-7.4%
-7.4%
-
Intl
207
177
16.9%
5.1%
11.8%
WW
381
365
4.4%
-1.3%
5.7%
OTC/NUTRITIONALS
US
542
726
-25.3%
-25.3%
-
Intl
665
622
6.9%
-2.7%
9.6%
WW
1,207
1,348
-10.5%
-15.0%
4.5%
WOMEN'S HEALTH
US
146
149
-2.0%
-2.0%
-
Intl
323
274
17.9%
7.8%
10.1%
WW
469
423
10.9%
4.4%
6.5%
WOUND CARE / OTHER
US
143
138
3.6%
3.6%
-
Intl
117
106
10.4%
-
10.4%
WW
260
244
6.6%
2.1%
4.5%
TOTAL CONSUMER
US
1,560
1,726
-9.6%
-9.6%
-
Intl
2,206
1,985
11.1%
1.4%
9.7%
WW
3,766
3,711
1.5%
-3.7%
5.2%
* See footnotes below
PHARMACEUTICAL SEGMENT (2) (5)
ACIPHEX/PARIET
US
119
138
-13.8%
-13.8%
-
Intl
141
125
12.8%
3.1%
9.7%
WW
260
263
-1.1%
-5.7%
4.6%
CONCERTA
US
231
269
-14.1%
-14.1%
-
Intl
98
75
30.7%
17.3%
13.4%
WW
329
344
-4.4%
-7.3%
2.9%
DURAGESIC/FENTANYL TRANSDERMAL
US
38
75
-49.3%
-49.3%
-
Intl
146
156
-6.4%
-13.4%
7.0%
WW
184
231
-20.3%
-25.1%
4.8%
LEVAQUIN/FLOXIN
US
363
408
-11.0%
-11.0%
-
Intl
8
17
-52.9%
-56.3%
3.4%
WW
371
425
-12.7%
-12.8%
0.1%
PREZISTA
US
89
72
23.6%
23.6%
-
Intl
98
50
96.0%
80.3%
15.7%
WW
187
122
53.3%
46.8%
6.5%
PROCRIT/EPREX
US
290
321
-9.7%
-9.7%
-
Intl
233
229
1.7%
-6.2%
7.9%
WW
523
550
-4.9%
-8.2%
3.3%
REMICADE
US
780
737
5.8%
5.8%
-
US Exports (3)
400
286
39.9%
39.9%
-
Intl
6
5
20.0%
19.9%
0.1%
WW
1,186
1,028
15.4%
15.4%
-
RISPERDAL/RISPERIDONE
US
5
118
-95.8%
-95.8%
-
Intl
133
157
-15.3%
-20.1%
4.8%
WW
138
275
-49.8%
-52.5%
2.7%
RISPERDAL CONSTA
US
117
126
-7.1%
-7.1%
-
Intl
262
199
31.7%
21.4%
10.3%
WW
379
325
16.6%
10.3%
6.3%
TOPAMAX
US
57
495
-88.5%
-88.5%
-
Intl
91
107
-15.0%
-21.6%
6.6%
WW
148
602
-75.4%
-76.6%
1.2%
VELCADE
US
-
-
-
-
-
Intl
261
192
35.9%
26.3%
9.6%
WW
261
192
35.9%
26.3%
9.6%
OTHER
US
717
629
14.0%
14.0%
-
Intl
955
794
20.3%
11.1%
9.2%
WW
1,672
1,423
17.5%
12.4%
5.1%
TOTAL PHARMACEUTICAL
US
3,206
3,674
-12.7%
-12.7%
-
Intl
2,432
2,106
15.5%
6.6%
8.9%
WW
5,638
5,780
-2.5%
-5.7%
3.2%
MAJOR NEW PHARM PRODUCTS (4)
INVEGA
US
69
66
4.5%
4.5%
-
Intl
39
25
56.0%
43.2%
12.8%
WW
108
91
18.7%
15.1%
3.6%
* See footnotes below
MEDICAL DEVICES AND DIAGNOSTICS (2)
CORDIS (6)
US
251
246
2.0%
2.0%
-
Intl
421
422
-0.2%
-6.3%
6.1%
WW
672
668
0.6%
-3.3%
3.9%
DEPUY
US
814
766
6.3%
6.3%
-
Intl
640
526
21.7%
11.2%
10.5%
WW
1,454
1,292
12.5%
8.2%
4.3%
DIABETES CARE
US
290
270
7.4%
7.4%
-
Intl
307
271
13.3%
5.4%
7.9%
WW
597
541
10.4%
6.4%
4.0%
ETHICON
US
510
405
25.9%
25.9%
-
Intl
637
548
16.2%
7.6%
8.6%
WW
1,147
953
20.4%
15.5%
4.9%
ETHICON ENDO-SURGERY
US
483
454
6.4%
6.4%
-
Intl
685
561
22.1%
12.9%
9.2%
WW
1,168
1,015
15.1%
10.0%
5.1%
ORTHO-CLINICAL DIAGNOSTICS
US
288
277
4.0%
4.0%
-
Intl
237
190
24.7%
16.1%
8.6%
WW
525
467
12.4%
8.9%
3.5%
VISION CARE
US
249
234
6.4%
6.4%
-
Intl
415
365
13.7%
6.9%
6.8%
WW
664
599
10.9%
6.8%
4.1%
TOTAL MEDICAL DEVICES AND DIAGNOSTICS
US
2,886
2,652
8.8%
8.8%
-
Intl
3,341
2,883
15.9%
7.5%
8.4%
WW
6,227
5,535
12.5%
8.1%
4.4%
(1) Operational growth excludes the effect of currency
(2) Select areas (unaudited)
(3) Reported in U.S. sales
(4) Included in Other
(5) Prior year conforms to current year presentation
(6) Includes sales of Drug-Eluting Stents for Q1 2010 of $60, $131 and $191MM Domestic, International and Worldwide respectively
Includes sales of Drug-Eluting Stents for Q1 2009 of $67, $184 and $251MM Domestic, International and Worldwide respectively
SOURCE Johnson & Johnson
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