J&J Tops Q1 Earnings Estimates, Raises Sales Guidance

Johnson & Johnson (JNJ – Free Report) kicked off 2018 pharma earnings on a strong note, beating the Zacks Consensus Estimate on both counts in the first quarter of 2018. The drug and consumer products giant upped its previously issued sales outlook for 2018. Shares were up around 1% in pre-market trading.

This year so far, J&J’s shares have declined 5.7%, comparing unfavorably with the 2.7% decline witnessed by the industry.

Earnings Beat

J&J’s first-quarter 2018 earnings came in at $2.06 per share, beating the Zacks Consensus Estimate of $2.01 and increasing 12.6% from the year-ago period.

Adjusted earnings excluded amortization expense and some special items. Including these items, J&J reported first-quarter earnings of $1.60 per share compared with earnings of $1.61 in the year-ago period.

Sales Beat Slightly

Sales came in at $20 billion, beating the Zacks Consensus Estimate of $19.48 billion. Sales also increased 12.6% from the year-ago quarter, reflecting an operational increase of 8.4% and a positive currency impact of 4.2%. Organically, excluding the impact of acquisitions and divestitures, sales increased 4.3% on an operational basis, better than 2.4% increase seen in 2017. This is because the Pharmaceutical segment continued the positive momentum seen in the second half of 2017 and the Consumer segment sales improved.

First-quarter sales grew 6.1% in the domestic market to $9.95 billion and 19.9% in international markets to $10 billion, reflecting 10.9% operational growth and 9% positive currency impact.

Sales in Details

Pharmaceutical segment sales rose 19.4% year over year to $9.84 billion, reflecting 15.1% operational growth and 4.3% positive currency impact as sales rose in both domestic and international markets. Sales in the domestic market rose 9.9% to $5.35 billion while international sales grew 33.1% to $4.49 billion (operational increase of 22.5%).

New products like Imbruvica (cancer) and Darzalex (multiple myeloma) continued to perform well. Core products like Xarelto, Stelara, Zytiga, Simponi/Simponi Aria and Invega Sustenna also contributed to growth. Please note that J&J markets Imbruvica in partnership with AbbVie, Inc. (ABBV – Free Report) .