Johnson & Johnson (JNJ) posted stronger-than-expected first quarter earnings Tuesday, while lifting its full-year profit forecast, as consumer health sales continue to drive overall revenue gains ahead of the division's listing on the New York Stock Exchange later this year.
The group also boosted its quarterly dividend by 5.3%, to $1.19 per share, "in recognition of our 2022 results, strong financial position, and confidence in the future," the company said.
Johnson & Johnson said adjusted earnings for the three months ending in March were pegged at $2.68 per share, up a penny from the same period last year and firmly ahead of the Street consensus forecast of $2.51 per share. Group revenues, Johnson & Johnson said, rose 5.6% to $24.75 billion, a figure that also topped analysts' estimates of a $23.67 billion tally.
Pharmaceuticals sales were up 4.2% to $13.41 billion while consumer health sales rose 7.4% to $3.85 billion. Medtech sales jumped 7.3% to $7.48 billion.
The company also lifted its 2022 earnings forecast by around 5 cents per share, to between $10.60 and $10.70 per share, up from its prior forecast of between $10.45 and $10.60 per share, with adjusted operational sales growth of between 4.5% and 5.5%.
“Our first quarter results demonstrate strong performance across all three segments of our business and reflect the dedication of Johnson & Johnson colleagues around the world,” said CEO Joaquin Duato. “With this momentum, I look forward to the remainder of the year, one filled with exciting catalysts that will create both near- and long-term value for patients and all of our stakeholders.”
Johnson & Johnson shares were marked 2.4% lower in early trading immediately following the earnings release to change hands at $160.61 each.
"Johnson & Johnson performed impressively across all of its major franchises with Consumer Health delivering stand-out results," said Lee Brown, Global Sector Lead for Healthcare at research group Third Bridge.
"Consumer Health increased 11.3% year-on-year on an operational basis, largely driven by its OTC products such as Tylenol and Motrin, as well as its Skin/Beauty products including Neutrogena and Aveeno," he added.
Investors will look for progress in the group's plans to list its consumer healthcare division -- with brands such as as Band-Aid, Baby Powder, Listerine, Neutrogena and Tylenol -- as a stand-alone company, known as Kenvue, on today's earnings conference call.
The group is also likely to address its recent move to re-submit a bankruptcy proposal to re-submit a bankruptcy petition on behalf of subsidiary that would payout billions in claims linked to allegations that its talc products caused users cancer.
Johnson & Johnson said the division, known as LTL Management, had re-submitted plans to the bankruptcy court in New Jersey that would see it pay $8.9 billion, spread out over 25 years, to settle the myriad claims, even though the company considers them "specious and lacking scientific merit."
