Tags: US | Earns | Johnson | & | Johnson

J&J Sales Climb, but Profit Falls on Big Charge

Tuesday, 26 Jan 2010 09:04 AM

The pain of the recession is easing a bit for Tylenol and Band-Aid maker Johnson & Johnson, which on Tuesday reported a healthy jump in fourth-quarter sales and gave a fairly upbeat forecast for this year.

But profit for the just-ended quarter was down due to a whopping charge — $1.1 billion after taxes — for its biggest restructuring ever, a program that will eliminate up to 8,000 jobs, or nearly 7 percent of the work force.

The world's largest maker of health care products said sales rose 9 percent to $16.55 billion, but profit dropped 19 percent to $2.21 billion, or 79 cents per share. Excluding one-time items, the company reported earnings per share of $1.02.

Analysts polled by Thomson Reuters on average were expecting revenue of $15.7 billion and earnings per share of 97 cents, excluding items.

Sales had fallen over the prior year as the recession pushed penny-pitching consumers to buy cheaper store brands instead of J&J bandages and nonprescription medicines. Meanwhile, sales of some of its blockbuster prescription drugs have been slashed by generic competition, and a drop in elective surgical procedures at hospitals had been cutting into sales of medical devices.

In the fourth quarter, sales of consumer products rebounded strongly, climbing 10 percent to $4.25 billion. Most of that improvement came overseas. Sales of prescription drugs were up just over 5 percent at $5.99 billion, with growth in other countries offsetting a small decline here. The medical devices and diagnostics division, now J&J's largest, saw the biggest improvement, a 12 percent jump in sales to $6.31 billion.

The company also gave its first profit forecast for 2010: $4.85 to $4.95 per share, excluding one-time items. That's up about 10 percent from J&J performance in 2009.

For the full year, the company reported net income of $12.27 billion, or $4.40 per share, down 5 percent from $12.95 billion, or $4.57 per share. Sales slipped 3 percent to $61.9 billion from $63.75 billion.

In premarket trading, shares of Johnson & Johnson fell 47 cents to $62.75 from Monday's close of $63.22.

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The pain of the recession is easing a bit for Tylenol and Band-Aid maker Johnson Johnson, which on Tuesday reported a healthy jump in fourth-quarter sales and gave a fairly upbeat forecast for this year.But profit for the just-ended quarter was down due to a whopping...
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Tuesday, 26 Jan 2010 09:04 AM
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