Pharma Is A Standout For Johnson & Johnson Amid A Quarter Hit By Foreign Exchange
Healthcare giant Johnson & Johnson is probably best known for its lines of household staples like Band-Aids, Tylenol and, of course, Johnson & Johnson baby lotion. But during the second quarter of 2015, name recognition had nothing to do with financial results: the company reported Tuesday morning that amid a quarter hit by foreign exchange rates, its sales results saw a bright spot not in its popular consumer products segment, but in the bevy of little-recognized names comprising its pharmaceutical division.
Johnson & Johnson reported $17.8 billion in second quarter revenue, a figure that managed to beat Wall Street’s $17.7 billion estimate yet is down 8.8% over sales reported this time last year. The company blamed foreign exchange rates for the revenue decline, saying that its sales took a 14.8% currency hit; without this hit, worldwide sales increased 1.7%.
Net earnings for the quarter came in at $4.5 billion, up 4.4% year-over-year and resulting in earnings of $1.61 per share. Excluding one-time items, net earnings were $4.8 billion, or $1.71 per share; these figures are down 6.3% and 3.9% year-over-year, but the adjusted earnings-per-share figure did manage to beat the analyst consensus by two cents.
“Our solid sales and earnings results in the quarter reflect the strong underlying growth we’re seeing across the enterprise,” Johnson & Johnson chairman and CEO Alex Gorsky said in a statement Tuesday morning. “Our diverse portfolio and scale are enabling this performance, and we’ve continued to invest in building a robust enterprise pipeline that will drive our growth over the long term.”
The “solid” sales results Gorsky is referring to looked like this on a segment-by-segment basis: consumer products sales dipped 7% to $3.5 billion; medical device sales dropped 12.2% to $6.4 billion; and the pharmaceutical division recorded the smallest sales decline with its $7.9 billion marking a 6.6% year-over-year slide.
The pharmaceutical segment was particularly helped by arthritis drugs Simponi — its sales jumped 30% in the U.S. and 9.2% on a worldwide basis — and Stelara, which netted $570 million during the quarter, up 8% year-over-year.
Alongside these quarterly results, Johnson & Johnson also said that it is lifting its full-year earnings forecast to a range of $6.10 to $6.20 per share, up from prior guidance of $6.04 to $6.19 per share.
Following the release of the earnings results, shares of Johnson & Johnson dipped 1.4% in early Tuesday trading; year-over-year, it’s down 2.9%.
Source: Forbes
