J&J 2Q profit jumps on higher sales, lower charges

July 16, 2013
In this Monday, July 15, 2013 photo, Johnson & Johnson baby products are shown for sale at a pharmacy in Miami. Johnson & Johnson reports quarterly earnings on Tuesday, July 16, 2013. (AP Photo/Lynne Sladky)

Health care giant Johnson & Johnson's second-quarter profit more than doubled, thanks to higher sales of medicines and medical devices as it recovers from recalls and manufacturing problems that cut into sales.

The comparison was made easier by last year's quarter being hurt by $2.2 billion in charges for an acquisition, litigation and asset writedowns.

The maker of baby shampoo, prescription drugs and medical devices handily beat Wall Street expectations and raised its forecast by a couple of cents.

New Brunswick, New Jersey-based J&J said net income was $3.83 billion, or $1.33 per share, up from $1.41 billion, or 50 cents per share, a year earlier.

Excluding one-time items, net income was $4.29 billion, or $1.48 per share.

Revenue was $17.88 billion, up 8.5 percent from $16.48 billion a year earlier.

Analysts polled by FactSet, on average, were expecting earnings per share of $1.39 and sales of $17.72 billion.

CEO Alex Gorsky said the results showed progress in "restoring a reliable suply of over-the-counter products to consumers, continuing the successful integration of Synthes and building on the momentum of our pharmaceutical business."

The company is still trying to resolve manufacturing problems that have led to about four dozen recalls since 2009, mostly of consumer health products such as Tylenol and Motrin.

Reduced sales of the recalled products, plus the factory upgrades and increased regulatory inspections, have cost J&J well over $1 billion and kept many products out of stores. The company has repeatedly pushed back its forecast for when all the recalled nonprescription medicines will be back on store shelves, now aiming to have about 75 percent of those products back in stores by year's end.

Meanwhile, the company's revenue has been boosted by its $19.7 billion acquisition of surgical trauma equipment and orthopedic implants maker Synthes Inc. last June.

Sales of medical devices and diagnostics, J&J's largest segment, climbed 9.6 percent to $7.19 billion in the quarter.

Prescription drug sales jumped nearly 12 percent to $7.03 billion, led by strong sales of immune disorder drug Remicade and prostate cancer drug Zytiga.

Sales of consumer health products edged up just 1.1 percent, to $3.66 billion.

The company raised its profit forecast to $5.40 to $5.47 per share, excluding one-time items. In January, J&J said it expected earnings of $5.35 to $5.45 per share.

The company noted that unfavorable currency exchange rates reduced revenue by 1.5 percent.

Explore further: Merck's 2Q net falls on charges, but sales rise

Related Stories

Merck's 2Q net falls on charges, but sales rise

July 27, 2012

Merck & Co.'s second-quarter net income fell 11.4 percent as slightly higher sales were offset by acquisition and restructuring costs. However, the drugmaker beat Wall Street expectations, and Merck shares jumped in early ...

J&J Q3 net income drops 7 percent on higher costs

October 16, 2012

Johnson & Johnson's third-quarter profit fell 7 percent as increased research and production costs offset higher sales for its medicines and medical devices and new revenue from its biggest acquisition ever.

Generic competition cuts Merck's Q1 sales, profit

May 1, 2013

Drugmaker Merck & Co. is reporting lower first-quarter results and cutting its 2013 profit forecast by 15 cents a share. It also is announcing a huge share buyback, up to $15 billion worth of its stock.

Sanofi earnings slashed in first quarter

May 2, 2013

(AP)—French drug maker Sanofi said Thursday its net profit was slashed in the first quarter from a year earlier as falling sales and patent losses on key drugs combined to hammer earnings.

Recommended for you

Sustaining biomedical research: Med school deans speak out

May 27, 2015

Cuts in federal support and unreliable funding streams are creating a hostile work environment for scientists, jeopardizing the future of research efforts and ultimately clinical medicine, according to leaders of the nation's ...

0 comments

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.