Wall Street shrugged this morning after Johnson & Johnson (NYSE:JNJ) posted a 2nd-quarter profit slide of 50% and lowered its profit guidance for the rest of the year, signalling investors’ low expectations for the earnings season.
Johnson & Johnson posted profits of $1.41 billion, or 50¢ per share, on sales of $16.48 billion during the 3 months ended June 30. That compares with profits of $2.78 billion, or $1 per share, on sales of $16.60 billion during the same period last year.
Excluding $2.2 billion in 1-time items, earnings reached $1.30 per share, topping The Street’s consensus by a penny. The non-recurring items included $564 million in transaction and integration costs from J&J’s $20 billion buyout of Synthes, restructuring costs for its exit from the coronary stent business and $611 million from "the net impact of expenses related to litigation."
Sign up to get our free newsletters delivered right to your inbox
“The completion of the Synthes acquisition also marks an important milestone in
strengthening our leadership in key health care markets, creating a powerful portfolio of
orthopaedic and neurological solutions to advance patient health and well-being,” CEO Alex Gorsky, presiding over his first earnings release since taking over the corner office last spring, said in prepared remarks.
The shaky economy across the pond took its toll, with European sales down 8.3% to $4.17 billion.
Johnson & Johnson said it now expects to post full-year profits of $5-$5.07, down from prior guidance of $5.05-$5.15 per share.
JNJ shares were down a hair to $68.35 as of about 12:15 p.m. today.
Medical device unit stays flat, but ortho shines
Sales for J&J’s medical device & diagnostics unit dropped 0.1% to $6.57 billion for the quarter, rising 2.9% in the U.S. but dropping 2.4% overseas. Sales fell across all of the company’s med-tech divisions except its orthopedics and specialty surgery units. Ortho sales jumped 10.8% to $1.63 billion and spec-surg sales rose 4.2% to $646.0 million. Sales for the cardiovascular division plummeted 14.1% to $504.0 million.
