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%*

Apr 15, 2014, 07:45 ET from Johnson & Johnson

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

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