Johnson & Johnson Reports 2014 First-Quarter Results: Sales of $18.1 Billion increased 3.5% Versus 2013 First Quarter;

First-Quarter EPS was $1.64

Excluding Special Items, 2014 First-Quarter EPS of $1.54 increased 6.9%*

NEW BRUNSWICK, N.J., April 15, 2014 /PRNewswire/ -- Johnson & Johnson (NYSE: JNJ) today announced sales of $18.1 billion for the first quarter of 2014, an increase of 3.5% as compared to the first quarter of 2013. Operational results increased 5.3% and the negative impact of currency was 1.8%.  Domestic sales increased 2.2%.  International sales increased 4.5%, reflecting operational growth of 7.9% and a negative currency impact of 3.4%.

Net earnings and diluted earnings per share for the first quarter of 2014 were $4.7 billion and $1.64, respectively. The first-quarter results included a net gain of after-tax special items of approximately $0.3 billion, related to a tax benefit associated with Conor Medsystems partially offset by integration and transaction costs related to the acquisition of Synthes, Inc. and an in-process research and development charge. First quarter 2013 net earnings included a net charge of after-tax special items of approximately $0.6 billion as shown in the accompanying reconciliation of non-GAAP financial measures. Excluding these special items, net earnings for the current quarter were $4.4 billion and diluted earnings per share were $1.54, representing increases of 7.8% and 6.9%, respectively, as compared to the same period in 2013.*  

"Johnson & Johnson delivered strong first-quarter results driven by successful new product launches and the continued growth of key products," said Alex Gorsky, Chairman and Chief Executive Officer. "Our talented colleagues around the world continue to bring meaningful innovations to patients and customers, addressing significant unmet needs. We also advanced our near-term priorities and long-term growth drivers, positioning us well to deliver sustainable results."

The Company increased its earnings guidance for full-year 2014 to $5.80 - $5.90 per share. The Company's guidance excludes the impact of special items.

Worldwide Consumer sales of $3.6 billion for the first quarter represented a decrease of 3.2% versus the prior year consisting of an operational decrease of 0.6% and a negative impact from currency of 2.6%.   

Domestic sales decreased 2.9% reflecting the divestiture of the sanitary protection business that was completed in October 2013. International sales decreased 3.4%, which reflected an operational increase of 0.7% and a negative currency impact of 4.1%.

Positive contributors to operational results were sales of AVEENO® and DABAO® skin care products; international sales of LISTERINE® oral care products; and U.S. sales of ZYRTEC®, an over-the-counter allergy treatment.

Worldwide Pharmaceutical sales of $7.5 billion for the first quarter represented an increase of 10.8% versus the prior year with operational growth of 12.2% and a negative impact from currency of 1.4%.  Domestic sales increased 7.7%. International sales increased 14.0% which reflected an operational increase of 16.9% and a negative currency impact of 2.9%. 

Primary contributors to operational sales growth were STELARA® (ustekinumab), a biologic approved for the treatment of moderate to severe plaque psoriasis and psoriatic arthritis; INVEGA®  SUSTENNA®/XEPLION® (paliperidone palmitate), a once-monthly, long-acting, injectable atypical antipsychotic for the treatment of schizophrenia in adults; PREZISTA® (darunavir), a treatment for HIV; VELCADE® (bortezomib), a treatment for multiple myeloma; and sales of new products.

The strong sales results of new products include OLYSIOTM/SOVRIADTM (simeprevir), for combination treatment of chronic hepatitis C in adult patients; ZYTIGA® (abiraterone acetate), an oral, once-daily medication for use in combination with prednisone for the treatment of metastatic, castration-resistant prostate cancer; XARELTO® (rivaroxaban), an oral anticoagulant; and INVOKANA® (canagliflozin) for the treatment of adults with type 2 diabetes.

Sales results were negatively impacted by loss of exclusivity for ACIPHEX® (rabeprazole), a proton pump inhibitor for gastrointestinal disorders and CONCERTA® (methylphenidate HCI) for the treatment of attention deficit hyperactivity disorder.

During the quarter, the U.S. Food and Drug Administration (FDA) granted approval of IMBRUVICA™ (ibrutinib) capsules for the treatment of patients with chronic lymphocytic leukemia who have received at least one prior therapy. In addition, the European Commission granted conditional approval for SIRTURO® (bedaquiline) in the European Union, for use as part of an appropriate combination regimen for pulmonary multi-drug resistant tuberculosis in adult patients.

Also during the quarter, the Committee for Medicinal Products for Human Use adopted several positive opinions recommending Marketing Authorization in the European Union for the use of simeprevir in combination with other medicinal products for the treatment of chronic hepatitis C in adult patients; siltuximab for the treatment of adult patients with multicentric Castleman's disease who are HIV-negative and human herpes virus-8 negative; and VOKANAMET™, a fixed-dose therapy combining canagliflozin and immediate release metformin in a single tablet, intended for the treatment of adults with type 2 diabetes.

In addition, a New Drug Application was submitted to the FDA seeking approval for a once-daily fixed-dose antiretroviral combination tablet containing darunavir, a protease inhibitor developed by Janssen R&D Ireland and marketed as PREZISTA® in the U.S., with cobicistat, an investigational pharmacokinetic enhancer or boosting agent, developed by Gilead Sciences, Inc. for use in combination with other human immunodeficiency virus medicines.

Worldwide Medical Devices and Diagnostics sales of $7.1 billion were flat compared to the prior year consisting of an operational increase of 1.8% offset by a negative currency impact of 1.8%.  Domestic sales decreased 1.6%. International sales increased 1.3%, which reflected an operational increase of 4.6% and a negative currency impact of 3.3%.

Primary contributors to operational growth were sales of products in the Orthopaedics business; the Specialty Surgery business; and Biosense Webster's electrophysiology products in the Cardiovascular Care business.

Sales results in the U.S. Diabetes Care business were negatively impacted by price declines associated with the implementation of Medicare competitive bidding in mail order and retail effective July 1, 2013.

During the quarter, the FDA approved the THERMOCOOL® SMARTTOUCH® Catheter for treatment of patients suffering from drug-resistant paroxysmal atrial fibrillation.

Also during the quarter, a binding offer was accepted from The Carlyle Group to acquire the Ortho-Clinical Diagnostics business for approximately $4.0 billion subject to customary adjustments. The transaction is expected to close toward the middle of the year, upon satisfaction of customary closing conditions.

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 128,300 employees at more than 275 Johnson & Johnson operating 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 are non-GAAP financial measures and should not be considered replacements for, and should be read together with, the most comparable GAAP financial measures. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures is included in the financial schedules accompanying this press release and can be found in the Investor Relations section of the Company's website at www.investor.jnj.com.

Johnson & Johnson will conduct a conference call with investors to discuss this news release today at 8:30 a.m., Eastern Time. A simultaneous webcast of the call 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, reconciliation of non-GAAP financial measures, and sales of key products/franchises. Additional information on Johnson & Johnson, including a pharmaceutical pipeline of selected compounds in late stage development and a copy of today's earnings call presentation can be found on the Company's website at www.investor.jnj.com.

NOTE TO INVESTORS

(This press release contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. The reader is cautioned not to rely on these forward-looking statements. These statements are based on current expectations of future events. If underlying assumptions prove inaccurate or known or unknown risks or uncertainties materialize, actual results could vary materially from the expectations and projections of Johnson & Johnson. Risks and uncertainties include, but are not limited to: economic factors, such as interest rate and currency exchange rate fluctuations; competition, including technological advances, new products and patents attained by competitors; challenges inherent in new product development, including obtaining regulatory approvals; challenges to patents; the impact of patent expirations; significant adverse litigation or government action including related to product liability claims; the impact of business combinations and divestitures; changes in behavior and spending patterns or financial distress of purchasers of health care products and services; changes to governmental laws and regulations and domestic and foreign health care reforms; general industry conditions including trends toward health care cost containment; increased scrutiny of the health care industry by government agencies; financial instability of international economies and sovereign risk; disruptions due to natural disasters; manufacturing difficulties or delays; complex global supply chains with increasing regulatory requirements; and product efficacy or safety concerns resulting in product recalls or regulatory action. A further list and description of these risks, uncertainties and other factors can be found in Johnson & Johnson's Annual Report on Form 10-K for the fiscal year ended December 29, 2013, including in Exhibit 99 thereto, and our subsequent filings with the Securities and Exchange Commission. Copies of these filings are available online at www.sec.gov, www.investor.jnj.com, or on request from Johnson & Johnson. Johnson & Johnson does not undertake to update any forward-looking statement 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


2014


2013


Total


Operations


Currency

Sales to customers by










segment of business




















Consumer










    U.S.

$     1,309


1,348


(2.9)

%

(2.9)


-

    International

2,248


2,327


(3.4)


0.7


(4.1)


3,557


3,675


(3.2)


(0.6)


(2.6)











Pharmaceutical










    U.S.

3,740


3,471


7.7


7.7


-

    International

3,758


3,297


14.0


16.9


(2.9)


7,498


6,768


10.8


12.2


(1.4)











Med Devices & Diagnostics










    U.S.

3,155


3,206


(1.6)


(1.6)


-

    International

3,905


3,856


1.3


4.6


(3.3)


7,060


7,062


0.0


1.8


(1.8)











U.S.

8,204


8,025


2.2


2.2


-

International

9,911


9,480


4.5


7.9


(3.4)

Worldwide

$   18,115


17,505


3.5

%

5.3


(1.8)

 

Johnson & Johnson and Subsidiaries






Supplementary Sales Data




















(Unaudited; Dollars in Millions)

FIRST QUARTER






Percent Change


2014


2013


Total


Operations


Currency

Sales to customers by










geographic area




















U.S.

$                8,204


8,025


2.2

%

2.2


-











Europe

4,885


4,481


9.0


6.6


2.4

Western Hemisphere excluding U.S.

1,695


1,783


(4.9)


7.1


(12.0)

Asia-Pacific, Africa

3,331


3,216


3.6


10.3


(6.7)

International

9,911


9,480


4.5


7.9


(3.4)











Worldwide

$              18,115


17,505


3.5

%

5.3


(1.8)

 

Johnson & Johnson and Subsidiaries

Condensed Consolidated Statement of Earnings 




















(Unaudited; in Millions Except Per Share Figures)

FIRST QUARTER












2014


2013


Percent




Percent




Percent


Increase


Amount


to Sales


Amount


to Sales


(Decrease)

Sales to customers

$    18,115


100.0


$    17,505


100.0


3.5

Cost of products sold

5,455


30.1


5,554


31.7


(1.8)

Selling, marketing and administrative expenses

5,183


28.6


5,223


29.8


(0.8)

Research and development expense

1,831


10.1


1,784


10.2


2.6

In-process research and development

18


0.1


64


0.4



Interest (income) expense, net

118


0.7


104


0.6



Other (income) expense, net

86


0.5


515


3.0



Earnings before provision for taxes on income

5,424


29.9


4,261


24.3


27.3

Provision for taxes on income

697


3.8


764


4.3


(8.8)

Net earnings

$      4,727


26.1


$      3,497


20.0


35.2











Net earnings per share (Diluted)

$        1.64




$        1.22




34.4











Average shares outstanding (Diluted)

2,874.7




2,858.8















Effective tax rate

12.9

%



17.9

%














Adjusted earnings before provision for taxes and net earnings (1)










Earnings before provision for taxes on income

$      5,560


30.7


$      5,070


29.0


9.7

Net earnings

$      4,426


24.4


$      4,107


23.5


7.8

Net earnings per share (Diluted)

$        1.54




$        1.44




6.9

Effective tax rate

20.4

%



19.0

%














(1) See Reconciliation of Non-GAAP Financial Measures.






 

Johnson & Johnson and Subsidiaries










Reconciliation of Non-GAAP Financial Measures
























First Quarter


% Incr. /


(Dollars in Millions Except Per Share Data)




2014


2013


(Decr.)












Earnings before provision for taxes on income - as reported




$   5,424


4,261


27.3

%











Litigation expenses




-


529














Synthes integration/transaction costs 




118


258














In-process research and development




18


64














Other




-


(42)














Earnings before provision for taxes on income - as adjusted




$   5,560


5,070


9.7

%











Net Earnings - as reported




$   4,727


3,497


35.2

%











Litigation expenses




-


391














Synthes integration/transaction costs 




84


183














In-process research and development




13


42














Tax benefit associated with Conor Medsystems




(398)


-














Other




-


(6)














Net Earnings - as adjusted 




$   4,426


4,107


7.8

%











Diluted Net Earnings per share - as reported




$    1.64


1.22


34.4

%











Litigation expenses




-


0.14














Synthes integration/transaction costs 




0.03


0.06














In-process research and development




0.01


0.02














Tax benefit associated with Conor Medsystems




(0.14)


-














Other




-


-














Diluted Net Earnings per share - as adjusted 




$    1.54


1.44


6.9

%





















The Company believes investors gain additional perspective of underlying business trends and results by providing a measure of earnings before provision for taxes on income, net earnings and diluted net earnings per share that excludes special items in order to evaluate ongoing business operations.


REPORTED SALES vs. PRIOR PERIOD ($MM)


FIRST QUARTER






% Change



2014


2013

Reported

Operational (1)

Currency

CONSUMER SEGMENT (2)








BABY CARE








US


$          102


103

-1.0%

-1.0%

-

Intl


443


461

-3.9%

2.4%

-6.3%

WW


545


564

-3.4%

1.7%

-5.1%

ORAL CARE








US


160


158

1.3%

1.3%

-

Intl


251


245

2.4%

6.9%

-4.5%

WW


411


403

2.0%

4.7%

-2.7%

OTC








US


366


354

3.4%

3.4%

-

Intl


645


689

-6.4%

-3.6%

-2.8%

WW


1,011


1,043

-3.1%

-1.2%

-1.9%

SKIN CARE








US


457


453

0.9%

0.9%

-

Intl


457


449

1.8%

4.5%

-2.7%

WW


914


902

1.3%

2.7%

-1.4%

WOMEN'S HEALTH








US


24


81

-70.4%

-70.4%

-

Intl


303


320

-5.3%

1.0%

-6.3%

WW


327


401

-18.5%

-13.4%

-5.1%

WOUND CARE/OTHER








US


200


199

0.5%

0.5%

-

Intl


149


163

-8.6%

-6.4%

-2.2%

WW


349


362

-3.6%

-2.6%

-1.0%









TOTAL CONSUMER








US


1,309


1,348

-2.9%

-2.9%

-

Intl


2,248


2,327

-3.4%

0.7%

-4.1%

WW


$       3,557


3,675

-3.2%

-0.6%

-2.6%

















See footnotes at end of schedule





 



REPORTED SALES vs. PRIOR PERIOD ($MM)


FIRST QUARTER






% Change



2014


2013

Reported

Operational (1)

Currency

PHARMACEUTICAL SEGMENT (2) (3)








IMMUNOLOGY








US


$      1,547


1,639

-5.6%

-5.6%

-

Intl


796


565

40.9%

46.6%

-5.7%

WW


2,343


2,204

6.3%

7.8%

-1.5%

REMICADE








US 


997


970

2.8%

2.8%

-

US Exports (4)


167


349

-52.1%

-52.1%

-

Intl


446


281

58.7%

67.3%

-8.6%

WW


1,610


1,600

0.6%

2.1%

-1.5%

SIMPONI/SIMPONI ARIA








US


104


94

10.6%

10.6%

-

Intl


155


143

8.4%

12.3%

-3.9%

WW


259


237

9.3%

11.6%

-2.3%

STELARA








US


279


226

23.5%

23.5%

-

Intl


177


120

47.5%

48.2%

-0.7%

WW


456


346

31.8%

32.0%

-0.2%

OTHER IMMUNOLOGY








US


-


-

-

-

-

Intl


18


21

-14.3%

-5.8%

-8.5%

WW


18


21

-14.3%

-5.8%

-8.5%

INFECTIOUS DISEASES








US


561


238

*

*

-

Intl


639


577

10.7%

11.8%

-1.1%

WW


1,200


815

47.2%

48.0%

-0.8%

EDURANT








US


5


3

66.7%

66.7%

-

Intl


76


40

90.0%

86.8%

3.2%

WW


81


43

88.4%

85.4%

3.0%

INCIVO








US


-


-

-

-

-

Intl


86


162

-46.9%

-47.4%

0.5%

WW


86


162

-46.9%

-47.4%

0.5%

OLYSIO/SOVRIAD








US


291


-

*

*

-

Intl


63


-

*

*

0.0%

WW


354


-

*

*

0.0%

PREZISTA








US


214


167

28.1%

28.1%

-

Intl


231


200

15.5%

15.5%

0.0%

WW


445


367

21.3%

21.3%

0.0%

OTHER INFECTIOUS DISEASES








US


51


68

-25.0%

-25.0%

-

Intl


183


175

4.6%

5.8%

-1.2%

WW


234


243

-3.7%

-2.8%

-0.9%

 



REPORTED SALES vs. PRIOR PERIOD ($MM)


FIRST QUARTER






% Change



2014


2013

Reported

Operational (1)

Currency









NEUROSCIENCE








US


601


746

-19.4%

-19.4%

-

Intl


1,037


998

3.9%

7.6%

-3.7%

WW


1,638


1,744

-6.1%

-4.0%

-2.1%

CONCERTA/METHYLPHENIDATE








US


35


139

-74.8%

-74.8%

-

Intl


115


117

-1.7%

2.9%

-4.6%

WW


150


256

-41.4%

-39.3%

-2.1%

INVEGA








US


86


71

21.1%

21.1%

-

Intl


79


61

29.5%

34.0%

-4.5%

WW


165


132

25.0%

27.1%

-2.1%

INVEGA SUSTENNA/ XEPLION








US


182


164

11.0%

11.0%

-

Intl


191


120

59.2%

60.7%

-1.5%

WW


373


284

31.3%

31.9%

-0.6%

RISPERDAL CONSTA








US


106


106

0.0%

0.0%

-

Intl


204


229

-10.9%

-9.1%

-1.8%

WW


310


335

-7.5%

-6.3%

-1.2%

OTHER NEUROSCIENCE








US


192


266

-27.8%

-27.8%

-

Intl


448


471

-4.9%

0.1%

-5.0%

WW


640


737

-13.2%

-10.0%

-3.2%

ONCOLOGY








US


240


199

20.6%

20.6%

-

Intl


782


595

31.4%

33.4%

-2.0%

WW


1,022


794

28.7%

30.2%

-1.5%

VELCADE








US


-


-

-

-

-

Intl


408


353

15.6%

18.6%

-3.0%

WW


408


353

15.6%

18.6%

-3.0%

ZYTIGA








US


229


161

42.2%

42.2%

-

Intl


283


183

54.6%

54.6%

0.0%

WW


512


344

48.8%

48.8%

0.0%

OTHER ONCOLOGY








US


11


38

-71.1%

-71.1%

-

Intl


91


59

54.2%

56.0%

-1.8%

WW


102


97

5.2%

6.3%

-1.1%

 



REPORTED SALES vs. PRIOR PERIOD ($MM)


FIRST QUARTER






% Change



2014


2013

Reported

Operational (1)

Currency

TOTAL OTHER








US


791


649

21.9%

21.9%

-

Intl


504


562

-10.3%

-8.7%

-1.6%

WW


1,295


1,211

6.9%

7.6%

-0.7%

PROCRIT/EPREX








US


176


233

-24.5%

-24.5%

-

Intl


134


145

-7.6%

-6.6%

-1.0%

WW


310


378

-18.0%

-17.6%

-0.4%

XARELTO








US


319


158

*

-

Intl


-


-

-

-

-

WW


319


158

*

*

-

OTHER








US


296


258

14.7%

14.7%

-

Intl


370


417

-11.3%

-9.6%

-1.7%

WW


666


675

-1.3%

-0.2%

-1.1%









TOTAL PHARMACEUTICAL








US


3,740


3,471

7.7%

7.7%

-

Intl


3,758


3,297

14.0%

16.9%

-2.9%

WW


$       7,498


6,768

10.8%

12.2%

-1.4%

















Supplemental Sales Information







2013



Q1


Q2

Q3

Q4

Full Year

EDURANT








US


3


3

4

5

15

Intl


40


53

60

68

221

WW


43


56

64

73

236

OLYSIO/SOVRIAD








US


-


-

-

13

13

Intl


-


-

-

10

10

WW


-


-

-

23

23









See footnotes at end of schedule





 



REPORTED SALES vs. PRIOR PERIOD ($MM)


FIRST QUARTER






% Change



2014


2013

Reported

Operational (1)

Currency

MEDICAL DEVICES AND DIAGNOSTICS (2) (3)








CARDIOVASCULAR CARE








US


$          205


198

3.5%

3.5%

-

Intl


336


315

6.7%

9.4%

-2.7%

WW


541


513

5.5%

7.2%

-1.7%

DIABETES CARE








US


192


283

-32.2%

-32.2%

-

Intl


320


317

0.9%

2.9%

-2.0%

WW


512


600

-14.7%

-13.7%

-1.0%

DIAGNOSTICS








US


224


248

-9.7%

-9.7%

-

Intl


219


229

-4.4%

-0.9%

-3.5%

WW


443


477

-7.1%

-5.4%

-1.7%

ORTHOPAEDICS








US 


1,292


1,261

2.5%

2.5%

-

Intl


1,129


1,124

0.4%

2.9%

-2.5%

WW


2,421


2,385

1.5%

2.7%

-1.2%

SPECIALTY SURGERY/OTHER (5)








US


417


404

3.2%

3.2%

-

Intl


457


435

5.1%

9.3%

-4.2%

WW


874


839

4.2%

6.4%

-2.2%

SURGICAL CARE 








US


539


531

1.5%

1.5%

-

Intl


969


977

-0.8%

2.2%

-3.0%

WW


1,508


1,508

0.0%

1.9%

-1.9%

VISION CARE








US


286


281

1.8%

1.8%

-

Intl


475


459

3.5%

10.0%

-6.5%

WW


761


740

2.8%

6.8%

-4.0%









TOTAL MEDICAL DEVICES AND DIAGNOSTICS








US


3,155


3,206

-1.6%

-1.6%

-

Intl


3,905


3,856

1.3%

4.6%

-3.3%

WW


$       7,060


7,062

0.0%

1.8%

-1.8%









* Percentage greater than 100%








(1) Operational growth excludes the effect of translational currency





(2) Unaudited








(3) Prior year amounts have been reclassified to conform to current year product disclosure

(4) Reported as U.S. sales








(5) Infection Prevention now reflected in Specialty Surgery/Other, previously reported independently

 

 

 

SOURCE Johnson & Johnson



RELATED LINKS
http://www.jnj.com

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