J&J Q4 Profit Rises On Lower Charges, Results Top View; Guides 2014 In Line

(RTTNews) - Health care giant Johnson & Johnson (JNJ) reported Tuesday a profit for the fourth quarter that increased 37 percent from last year, despite loss of exclusivity for some products, reflecting lower charges and sales growth. Adjusted earnings per share and quarterly revenues also topped analysts' expectation. The company also provided earnings forecast for the full-year 2014, in line with Street view.

The New Brunswick, New Jersey-based maker of Listerine antiseptic mouth-rinse, Acuvue contact lenses and Band-Aids reported net earnings of $3.52 billion or $1.23 per share for the fourth quarter, higher than $2.57 billion or $0.91 per share in the prior-year quarter.

The results for the latest quarter include after-tax charges of $42 million, mainly related to a rise in the litigation accrual and program costs associated with the DePuy ASR Hip recall, in-process research and development, and integration and transaction costs related to the Synthes, Inc. acquisition. Meanwhile, the year-ago quarter included after-tax charges of about $800 million.

Excluding items, adjusted earnings for the quarter was $3.56 billion or $1.24 per share, compared to $3.38 billion or $1.19 per share in the year-ago quarter.

On average, 17 analysts polled by Thomson Reuters expected the company to report earnings of $1.20 per share for the quarter. Analysts' estimates typically exclude special items.

Sales to customers for the quarter increased 4.5 percent to $18.36 billion from $17.56 billion in the same quarter last year, and topped thirteen Wall Street analysts' consensus estimate of $17.95 billion. Operational sales grew 6.3 percent and the negative impact of currency was 1.8 percent.

According to the company, sales results were hurt by loss of exclusivity for Aciphex / Pariet (rabeprazole), and Concertz (methylphenidate HCI).

Domestic sales increased 7.4 percent year-over-year to $8.01 billion, and international sales also grew 2.4 percent to $10.34 billion from last year, reflecting operational growth of 5.6 percent and a negative currency impact of 3.2 percent.

European sales grew 7.9 percent, while Asia-Pacific and Africa sales decreased 2.6 percent from the year-ago quarter. Sales for Western Hemisphere, excluding the U.S., declined 2 percent from last year.

The company's consumer product sales grew 2.8 percent to $3.75 billion, with domestic sales increasing 5.0 percent, and international sales growing 1.7 percent.

Pharmaceutical sales were $7.30 billion, up 11.8 percent from the prior year, boosted by a 13.8 percent sales growth of rheumatoid arthritis drug Remicade to $1.71 billion. Total domestic sales increased 17.9 percent, and international sales grew 6.6 percent.

The company's sales from medical devices and diagnostics declined 1.0 percent from last year to $7.31 billion, with a 1.4 percent drop in domestic sales and a 0.7 percent decline in international sales.

For fiscal 2013, the company reported net earnings of $13.83 billion or $4.81 per share, higher than $10.85 billion or $3.86 per share in the prior year.

Excluding items, adjusted earnings for the year was $15.88 billion or $5.52 per share, compared to $14.35 billion or $5.10 per share in the year ago. Analysts expected the company to report earnings of $5.48 per share for fiscal 2013.

Sales to customers for the full year grew 6.1 percent to $71.31 billion from $67.24 billion in the previous year. Street was looking for full-year 2013 revenues of $70.93 billion. Operational sales increased 7.7 percent and the negative impact of currency was 1.6 percent.

"Johnson & Johnson delivered strong results in 2013 led by the outstanding performance in our Pharmaceutical business, the strength of key brands in our US OTC and other Consumer businesses and continued progress in integrating Synthes into our Medical Devices and Diagnostics business," Chairman and CEO Alex Gorsky said.

Looking ahead to fiscal 2014, the company anticipates adjusted earnings in a range of $5.75 to $5.85 per share. Analysts currently expect the company to report full-year 2014 earnings of $5.85 per share.

JNJ closed Friday's regular trading session at $95.06, up $0.34 on a volume of 13.71 million shares. In the past 52-week period, the stock has been trading in a range of $72.42 to $95.99.