Drug giant Johnson & Johnson (JNJ) reported Tuesday a 19.5 percent decline in second-quarter profit hurt by charges related to Cordis restructuring and other litigation matters. However, adjusted earnings increased from last year and topped market projections with strong international sales and positive currency impact. The company also backed its full-year adjusted earnings view.
Second-quarter net earnings were $2.78 billion or $1 per share, lower than prior year's $3.45 billion or $1.23 per share.
The latest quarter results included a charge of $549 million due to restructuring of Cordis Corp. as well as a charge of $223 million related to litigation matters and additional DePuy ASR Hip recall costs, partly offset by a mark-to-market currency option gain related to the planned $21.3 billion acquisition of Synthes, Inc.
Adjusted net earnings rose 4.9 percent to $3.55 billion, and earnings per share grew 5.8 percent to $1.28 from $1.21 last year.
On average, 12 analysts polled by Thomson Reuters expected the company to earn $1.23 per share for the quarter. Analysts' estimates typically exclude special items.
Quarterly sales rose 8.3 percent to $16.60 billion from $15.33 billion in the prior year quarter, beating eleven analysts' consensus estimate of $16.22 billion.
For the quarter, domestic sales edged up 0.1 percent to $7.45 billion, while international sales climbed 15.9 percent to $9.15 billion, reflecting strong operational growth and positive currency impact.
Chairman and Chief Executive Officer William Weldon stated, "Our recently launched pharmaceutical products continued to achieve strong growth and contributed to our solid second quarter results. We received several new product approvals across our businesses which will benefit patients around the world and drive future growth.'
Consumer sales grew 4 percent as lower U.S. sales were offset by strong international sales growth.
Sales were 12.2 percent higher at Pharmaceutical division with improved performance in both regions along with strong performance of recently launched products.
In Medical Devices and Diagnostics, sales rose 7.2 percent reflecting strong international performance with positive currency impact, while U.S. sales edged up 1 percent.
Further, the company maintained its full-year 2011 earnings guidance of $4.90 to $5.00 per share, excluding the impact of special items. Analysts expect the company to report earnings of $4.95 per share for fiscal 2011.
JNJ is currently trading at $67.20 in pre-market activity, up $0.11 or 0.16 percent.
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