FILE- This Nov. 14, 2018, file photo shows Lubriderm, a Johnson & Johnson product, on display at a market in Pittsburgh. Johnson & Johnson reports financial results Tuesday, Jan. 22, 2019. (AP Photo/Gene J. Puskar, File)

Johnson & Johnson puts up strong profit and revenue in 4Q

January 22, 2019 - 5:27 am

A big jump in prescription drug sales, particularly overseas, helped Johnson & Johnson swing to a large fourth-quarter profit after posting a huge loss a year ago, when it took a $13.6 billion charge related to the late-2017 U.S. tax overhaul.

The world's biggest maker of health care products also benefited from an effective tax rate of 2.6 percent for the latest quarter, amounting to just $80 million. That was the main reason J&J topped Wall Street profit expectations, Credit Suisse analyst Vamil Divan wrote to investors.

The company also reported lower spending on research and development, restructuring and interest charges.

In premarket trading, J&J shares fell $1.99, or 1.5 percent, to $128.70.

The maker of baby shampoo and biotech drugs on Tuesday reported net income of $3.04 billion, or $1.12 per share, for 2018's fourth quarter. A year earlier, J&J reported a rare net loss — $10.71 billion, or $3.00 per share. That was due to the $13.6 billion charge, for a tax payment on years of accumulated foreign earnings, amounting to more than $66 billion, brought back to the U.S. at low tax rates.

Earnings in the latest quarter, adjusted for one-time gains and costs, came to $1.97 per share, or 2 cents better than industry analysts expected, according to a survey by Zacks Investment Research.

The New Brunswick, New Jersey- based company said revenue totaled $20.39 billion, also edging out expectations, though that was just 1 percent higher than 2017's fourth quarter.

As usual, J&J's prescription drug business drove the strong performance, with sales jumping 5.3 percent to $10.19 billion. Sales of cancer drugs including Darzalex, Imbruviga and Zytiga jumped 22 percent to a total of $2.49 billion, and sales of Remicade, Simponi and Stelara, for rheumatoid arthritis and other immune disorders, rose 8.3 percent to a total of $3.34 billion.

Johnson & Johnson's consumer health business posted flat sales of $3.54 billion, while the medical devices and diagnostics business, which the company has been revamping for a couple years, saw sales drop 4.4 percent to $6.67 billion.

For all of 2018, Johnson & Johnson reported revenue of $81.58 billion, up 6.7 percent, and net income of $15.3 billion, or $5.61 per share.

Johnson & Johnson expects full-year earnings between $8.50 and $8.65 per share, with revenue between $80.4 billion and $81.2 billion. Industry analysts have projected per-share earnings of $8.60 and revenue of about $82.6 billion.

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Follow Linda A. Johnson at https://twitter.com/LindaJ_onPharma

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Portions of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research.

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