JNJ Sees Higher FY17 Results, But Below Market View; Q4 Earnings Top Estimates

(RTTNews) - Drug major Johnson & Johnson (JNJ) Tuesday said it expects higher earnings and sales for its fiscal 2017, which are below market estimates. The company also reported solid fourth-quarter results, with adjusted earnings above market estimates, while sales missed their view, despite a growth.

In pre-market activity on the NYSE, Johnson & Johnson shares were losing 1.68 percent to $112.

For fiscal 2017, the company expects adjusted earnings of $6.93 to $7.08 per share, reflecting expected operational growth in the range of 4.8 percent to 7.0 percent. Sales for the year are expected to be in a range of $74.1 billion to $74.8 billion reflecting expected operational growth in the range of 4.0 percent to 5 percent. Excluding the impact of acquisitions and divestitures, operational sales growth is expected to be in the range of 3.0 percent to 3.5 percent.

On average, 22 analysts polled by Thomson Reuters expect earnings of $7.11 per share for the year. Analysts' estimates typically exclude special items. Analysts were looking for sales of $75.1 billion.

In the year 2016, the company's reported earnings per share were $5.93 and adjusted earnings per share were $6.73 on sales of $71.89 billion. These were higher than the previous year.

As part of the ongoing portfolio management, the company said it is in a process to evaluate potential strategic options for the Johnson & Johnson Diabetes Care Companies, specifically LifeScan, Inc., Animas Corporation, and Calibra Medical, Inc. The options include partnerships, joint ventures or strategic alliances, a sale of the businesses, or other alternatives.

The company also said there can be no assurance that this process will result in any transaction or other strategic alternative of any kind.

In its fourth quarter, Johnson & Johnson's net earnings climbed 18.6 percent to $3.81 billion from last year's $3.22 billion. Earnings per share were $1.38, a growth of 20 percent from last year's $1.15.

Excluding after-tax intangible amortization expense and special items, adjusted net earnings for the current quarter were $4.36 billion or $1.58 per share, compared to $4.04 billion or $1.44 per share last year.

Quarterly sales were $18.11 billion, an increase of 1.7 percent from last year's $17.81 billion.

Analysts expected earnings of $1.56 per share on sales of $18.28 billion for the quarter.

Operational sales results increased 2.3 percent. Domestic sales increased 2.6 percent, while International sales edged up 0.6 percent.

The prior year quarter's additional shipping days negatively impacted the current quarter by 480 basis points. On an adjusted basis, worldwide sales increased 7.6 percent, domestic sales increased 9.5 percent and international sales increased 5.6 percent.