Johnson & Johnson (J&J) has received setback during the first quarter ended March 2015 due to lower sales in Europe and Asia-Pacific and Africa, adverse exchange rates and higher tax provision. The net sales declined by 8.6 per cent to $17,374 million from $18,115 million in the corresponding period of last year. Its net profit also declined by 8.6 per cent to $4,320 million from $4,727 million. EPS worked out to $1.53 as against $1.64 in the last period.
J&J's sales in US increased by 5.9 per cent to $8,692 million from $8,204 million. However, its sales in Europe declined by 17.3 per cent to $4,040 million from $4,885 million and that in Western Hemisphere excluding US declined by 3.3 per cent to $1,639 million from $1,695 million. Similarly, its sales in Asia-Pacific, Africa declined by 9.8 per cent to $3,003 million from $3,331 million.
Its pharmaceutical sales improved by 3 per cent to $7,726 million from $7,498 million in the similar quarter of last year. The pharma sales in US improved by 16.9 per cent to $4,371 million from $3,740 million, but that in international market declined by 10.7 per cent to $3,355 million from $3,758 million. Pharma sales contributed 44.5 per cent to it total sales. The sales of medical devices declined by 11.4 per cent to $6,258 million and that of Consumer Health declined by 4.7 per cent to $3,390 million.
Alex Gorsky, chairman and CEO, said, “The company delivered strong underlying growth in the first quarter driven by new products and the strength of the core business. Of note is the continued robust growth of the pharmaceutical business and the solid performance of our Consumer brands. I am proud of our global teams who focus every day on delivering innovative solutions to address evolving health care needs.”
Its R&D expenditure increased by 10.1 per cent to $1,899 million during the first quarter ended March 2015 from $1,831 million. Its selling, marketing and administrative expenses went by 28.6 per cent to $4,847 million from $5,183 million. Tax provision increased to $1,255 million from $697 million.
It updated its adjusted earnings guidance for full-year 2015 to $6.04 to $6.19 per share reflecting further negative foreign currency movements.
New products include Invokana/Invokamet (canagliflozin), for the treatment of adults with type 2 diabetes, Xarelto (rivaroxaban), an oral anticoagulant; Imbruvica (ibrutinib), an oral, once-daily therapy approved for use in treating certain B-cell malignancie, or blood cancers; Zytiga (abiraterone acetate), an oral once-daily medication for use in combination with prednisone for the treatment of metastatic, castration-resistant prostate cancer, and international sales of Olysio, for combination treatment of chronic hepatitis C in adult patients, contributed to its pharma sales.