J&J profit soars on fewer charges, Synthes deal

Johnson &Johnson reported a surge in fourth-quarter earnings from a year-earlier period that was weighed down by legal costs, while an acquisition helped sales rise 8%.
The health-care giant, which is trying to bounce back from a series of product recalls, had lighter-than-expected quarterly sales and issued a forecast for 2013 earnings that fell slightly short of Wall Street expectations.J&J reported its quarterly numbers ahead of a meeting with analysts and investors in New York where executives plan to spotlight the company’s biggest business unit, medical devices and diagnostics, newly enlarged by last year’s $20 billion purchase of device maker Synthes.
J&J’s new chief executive, Alex Gorsky, has said his top priorities are restoring the supply of over-the-counter medicines–including Tylenol–that were subject to a series of recalls, integrating the Synthes purchase, and building on recent momentum in J&J’s pharmaceutical unit, which has launched several new drugs.For the fourth quarter, J&J earned $2.57 billion, or 91 cents a share, compared with $218 million, or 8 cents a share, a year earlier. The year-earlier quarter included hefty charges related to litigation over J&J’s recall of hip-replacement parts and other items, while the latest quarter included a lesser amount of similar charges.Excluding one-items in both periods, per-share earnings rose to $1.19 from $1.13.Sales rose 8% to $17.56 billion, with the Synthes deal contributing 5.6 percentage points of growth.J&J was expected to earn $1.17 per share, excluding certain one-time items, on revenue of $17.67 billion for the fourth quarter, according to mean estimates of analysts surveyed by Thomson Reuters.For full-year 2013, J&J expects to earn $5.35 to $5.45 per share, excluding certain items. Analysts were expecting earnings to rise 8% to $5.49 per share on a 7% increase in revenue to $72.17 billion.Medical device and diagnostics sales rose 13.7% to $7.38 billion in the fourth quarter. Pharmaceutical sales rose 7.1% to $6.53 billion, while consumer-healthcare sales fell 0.4% to $3.65 billion.
Source:Peter Loftus. http://online.wsj.com