Johnson & Johnson fourth quarter profit jumps on higher sales

Tuesday 22 January 2013 15.17
J&J reports net income of $2.57 billion for fourth quarter
J&J reports net income of $2.57 billion for fourth quarter

Higher sales helped Johnson & Johnson post a much bigger fourth-quarter profit than a year ago, when several charges depressed results.

However, the US-based maker of prescription drugs, consumer health products and medical devices said its 2013 profit forecast, for $5.35 to $5.45 per share, came up short of estimates of $5.49.

The company said today that net income was $2.57 billion, or 91 cents per share, up from $218m, or 8 cents per share, in 2011's fourth quarter.

Excluding about $800m in one-time acquisition and litigation charges, earnings in the latest quarter would have been $3.38 billion, or $1.19 per share. That beat the expectation of analysts by 2 cents per share.

The company's revenue totaled $17.56 billion, just shy of analysts' average estimate of $17.69 billion.

''Our results included strong growth of key products, successful new product launches and the addition of Synthes," chief executive ALex Gorski said in a prepared statement. "We continued to make important investments building strategic partnerships and in advancing our pipeline."

But J&J's long-running manufacturing quality problems continued to hurt sales of consumer health products, which were down 3.6% in the US and 0.4% worldwide at a total of $3.65 billion.

The company has issued about 30 recalls of Tylenol, Motrin and other products since September 2009. Upgrading its factories and getting all the products back in stores has dragged on far longer than the company predicted.

Sales of medical devices and diagnostics, J&J's largest business, helped compensate for that with a 13.7%increase, to a total of $7.38 billion. Prescription medicine sales rose 7.1%, to $6.53 billion.

The one-time charges included more reserves and other costs for recalls of the company's DePuy hip implants, costs related to the June acquisition of surgical trauma equipment and orthopedic implants maker Synthes and some research and development costs.