Healthcare giant Johnson & Johnson on Tuesday posted a 7.5 percent increase in second-quarter income despite ongoing recalls of popular nonprescription medicines keeping sales flat.
Still, the maker of Band-Aids, birth control and biotech drugs reduced its profit forecast for the year by 15 cents a share.
Johnson & Johnson, which has recalled tens of millions of bottles of Tylenol other products made by its McNeil Consumer Healthcare unit, said its net income for the quarter was $3.45 billion, or $1.23 per share. That's up from $3.21 billion, or $1.15 per share, a year earlier.
Excluding a one-time gain of $67 million from settling litigation, earnings per share would have been $3.38 billion, or $1.21.
That just matched forecasts of analysts polled by Thomson Reuters, who were expecting earnings of $1.21 per share, excluding one-time items. But the analysts expected revenue of $15.66 billion, $300 million more than J&J produced.
Johnson & Johnson said it now expects earnings per share for the year of $4.65 to $4.75, down from its April forecast of $4.80 to $4.90. Those numbers exclude the impact of any one-time charges or gains.
The company blamed the reduction on repeated recalls of nonprescription pain relievers, allergy medicine and other drugs, suspension of manufacturing at the Fort Washington, Pa., factory where they were made from this past April until at least next summer and unfavorable currency exchange rates.
"Remedial actions to address the product quality issues at McNeil Consumer Healthcare are ongoing and are of high importance," Chief Executive William Weldon said in a statement. "At the same time, we continue to make significant investments in acquisitions, strategic partnerships and in advancing our pipeline, positioning us well for future growth."
In premarket trading, shares of the company traded down to $58.49 from Monday's close of $59.57.
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