J&J posts higher 1-Q profit
NEW JERSEY, United States – THE world’s biggest maker of health care products may be on the mend, reporting a slight increase in profit yesterday, after the recession dragged results down last year.
Johnson & Johnson said its first-quarter profit rose 29 per cent, to US$4.53 billion or US$1.62 per share, but that’s mainly due to a one-time gain from litigation. Excluding that US$910-million gain, net income increased 3.1 per cent, to US$3.6 billion, or US$1.29 per share.
The maker of biologic drugs, Band-Aids and baby shampoo said sales were up four per cent to US$15.63 billion. But all of that gain was due to a four per cent boost from the impact of currency exchange rates.
J&J said US sales were down five per cent, while international sales rose 14.4 per cent, with nearly two-thirds of that increase due to favourable exchange rates.
Sales of prescription drugs declined 2.5 per cent, to US$5.6 billion, while sales of medical devices and diagnostic products rose 12.5 per cent, to US$6.2 billion. Sales of consumer products rose 1.5 per cent to US$3.8 billion. Those figures all were boosted by the exchange rates.
Still, the results were slightly better than experts’ forecasts. Analysts polled by Thomson Reuters expected J&J to earn US$1.27 per share on sales of US$15.6 billion.
Also yesterday, J&J lowered its 2010 profit forecast to US$4.80 to US$4.90 per share, citing the impact of currency exchange rates. Those numbers exclude the impact of one-time items.
In January, J&J gave a profit forecast of US$4.85 to US$4.95 per share, excluding one-time items and the impact of the health care overhaul. That was a bit lighter than the high end of analysts’ forecasts at the time, and J&J shares dipped about 0.7 per cent that day.
William C Weldon, the chief executive, said the “solid financial results” were achieved “despite a major product recall and the continued impact of patent expirations”.
Last fall, J&J began a large recall of a half-dozen popular over-the-counter medicines, including Tylenol pain reliever, due to an odd odour in the packages. Analysts were expecting an update on that Tuesday.
