Higher Prescription-Drug Sales Aid Johnson & Johnson Results--Update
16 Abril 2019 - 12:46PM
Dow Jones News
By Peter Loftus and Kimberly Chin
Higher prescription-drug sales helped Johnson & Johnson
offset softness in its consumer-products and medical-device
businesses and report better-than-expected first-quarter sales and
earnings, while slightly boosting its forecast of full-year
sales.
J&J shares rose 2.5% to $139.88 on the report, as the stock
continued to rebound from a sharp selloff in late 2018 triggered by
fresh concerns about liability in litigation over the safety of
Johnson's Baby Powder and other talc-containing products.
"We are much more confident at this point in the year than maybe
we were a year ago," J&J CFO Joseph Wolk told analysts on a
conference call, referring to the financial forecast.
Analysts said the quarterly results and updated full-year
forecast show J&J is navigating through its challenges, which
also include competition from lower-cost generic drugs. "To us, the
good far outweighs any possible questions or concerns investors
could have on the quarterly performance," SVB Leerink analyst
Danielle Antalffy said in a research note.
J&J's world-wide pharmaceutical sales rose 4.1% to $10.24
billion, fueled by gains for anti-inflammatory drug Stelara and
cancer treatment Darzalex. Competition from generic drugs hurt
sales of arthritis treatment Remicade and cancer drug Zytiga.
J&J's second-biggest business by sales, medical devices,
posted a sales decline of 4.6% to $6.46 billion. Excluding
divestitures, acquisitions and currency effects, J&J said sales
grew 4.3%, helped by sales of cardiology devices and contact
lenses.
Global sales of J&J's consumer products, which include
brands such as Band-Aid and Tylenol, dropped 2.4% to $3.32 billion.
J&J said "broad market softness" affected results, including a
soft cold-and-flu season in Russia and Western Europe, which hurt
sales of certain over-the-counter drugs.
Sales of J&J's baby-care products dropped 14% globally,
which J&J attributed partly to inventory changes related to
launching new versions of products outside the U.S. J&J rolled
out the new versions in the U.S. last year.
J&J didn't break out sales of its talc-containing powders.
At least 13,000 lawsuits against the company allege that use of
Johnson's Baby Powder and other talc products caused ovarian cancer
and mesothelioma.
J&J didn't discuss the lawsuits in its earnings release or
on a conference call with analysts. It says decades of testing have
shown its baby powder is safe and asbestos-free, and that it
doesn't cause cancer. The U.S. Justice Department and the
Securities and Exchange Commission have issued subpoenas seeking
documents related to talc safety.
The New Brunswick, N.J.,-based company anticipates adjusted
earnings this year to be between $8.53 to $8.63 per share, narrowed
from its prior forecast of $8.50 to $8.65 a share. It expects
operational sales, excluding currency impact, to be between $82
billion and $82.8 billion, up from $81.6 billion to $82.4 billion
as previously targeted.
Overall, sales rose 0.1% to $20.02 billion, ahead of analysts'
expectations. J&J's profit fell 14% from the year-ago quarter
to $3.75 billion, or $1.39 a share. Excluding various items,
J&J earned $2.10 a share, topping expectations.
Write to Peter Loftus at peter.loftus@wsj.com and Kimberly Chin
at kimberly.chin@wsj.com
(END) Dow Jones Newswires
April 16, 2019 11:31 ET (15:31 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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