Johnson & Johnson Reports 2010 First-Quarter Results:

Sales of $15.6 Billion Increased 4.0% Versus 2009 First Quarter; EPS was $1.62

Excluding Special Items, 2010 First-Quarter EPS was $1.29, an increase of 2.4%*

News provided by

Apr 20, 2010, 07:45 ET

NEW BRUNSWICK, N.J., April 20 /PRNewswire-FirstCall/ -- Johnson & Johnson (NYSE: JNJ) today announced sales of $15.6 billion for the first quarter of 2010, an increase of 4.0% as compared to the first quarter of 2009. Operational results declined 0.1% and the positive impact of currency was 4.1%. Domestic sales declined 5.0%, while international sales increased 14.4%, reflecting operational growth of 5.5% and a positive currency impact of 8.9%.

Net earnings and diluted earnings per share for the first quarter of 2010 were $4.5 billion and $1.62, respectively. First-quarter 2010 net earnings included an after-tax gain of $910 million representing the net impact of litigation matters. Excluding this special item, net earnings for the current quarter were $3.6 billion and diluted earnings per share were $1.29, representing increases of 3.1% and 2.4%, respectively, as compared to the same period in 2009.* The Company updated its earnings guidance for full-year 2010 to $4.80 - $4.90 per share to reflect recent changes in foreign currency exchange rates. Earnings guidance excludes the impact of special items and now incorporates the impact of recently enacted health care reform legislation.

"Thanks to the outstanding efforts of our people, we were able to deliver solid financial results," said William C. Weldon, Chairman and Chief Executive Officer. "This was accomplished despite a major product recall and the continued impact of patent expirations. We are well positioned for future growth."

Worldwide Consumer sales of $3.8 billion for the first quarter represented an increase of 1.5% versus the prior year consisting of a decrease of 3.7% operationally and a positive impact from currency of 5.2%. Domestic sales decreased 9.6%; international sales increased 11.1%, which reflected an operational increase of 1.4% and a positive currency impact of 9.7%.

Positive contributors to operational results were NEUTROGENA®, AVEENO® and LE PETIT MARSEILLAIS® skin care products; ZYRTEC® over-the-counter allergy treatment; international sales of LISTERINE® antiseptic mouthrinse; and women's sanitary protection products. These operational sales increases were more than offset by the impact of the previously announced recall of selected OTC products as well as the devaluation of the Venezuelan currency.

Worldwide Pharmaceutical sales of $5.6 billion for the first quarter represented a decrease of 2.5% versus the prior year consisting of an operational decline of 5.7% and a positive impact from currency of 3.2%. Domestic sales decreased 12.7%; international sales increased 15.5%, which reflected an operational increase of 6.6% and a positive currency impact of 8.9%.

Products with strong operational growth included REMICADE® (infliximab), a biologic approved for the treatment of a number of immune mediated inflammatory diseases; PREZISTA® (darunavir), a treatment for HIV; VELCADE® (bortezomib), a treatment for multiple myeloma; and international sales of RISPERDAL® CONSTA® (risperidone) Long-Acting Treatment, an antipsychotic medication. Strong growth was also achieved from newly launched products including STELARA™ (ustekinumab), a biologic approved for the treatment of moderate to severe plaque psoriasis; and SIMPONI™(golimumab), a biologic approved to treat adults with moderate to severe rheumatoid arthritis, psoriatic arthritis, and ankylosing spondylitis.

Sales results of TOPAMAX® (topiramate), an antiepileptic and a treatment for migraine, and RISPERDAL® (risperidone), an antipsychotic medication, were negatively impacted by generic competition.

Worldwide Medical Devices and Diagnostics sales of $6.2 billion for the first quarter represented an increase of 12.5% versus the prior year consisting of an operational increase of 8.1% and a positive currency impact of 4.4%. Domestic sales increased 8.8%; international sales increased 15.9%, which reflected an operational increase of 7.5% and a positive currency impact of 8.4%.

Primary contributors to operational growth included Ethicon's surgical care products; DePuy's orthopaedic joint reconstruction and sports medicine businesses; Ethicon Endo-Surgery's minimally invasive products and Advanced Sterilization Products' infection prevention solutions; and Ortho-Clinical Diagnostics' professional products. This growth was partially offset by lower sales in the Cordis franchise, reflecting continued competition in the drug-eluting stent market.

During the quarter, the Company filed for CE Mark in Europe for its NEVO® Sirolimus-Eluting Coronary Stent, the first drug-eluting stent to utilize RES TECHNOLOGY™ , eliminating the need for surface coated and permanent polymers.

About Johnson & Johnson

Caring for the world, one person at a time…inspires and unites the people of Johnson & Johnson. We embrace research and science - bringing innovative ideas, products and services to advance the health and well-being of people. Our approximately 114,000 employees at more than 250 Johnson & Johnson companies work with partners in health care to touch the lives of over a billion people every day, throughout the world.

* Net earnings and diluted earnings per share excluding special items, such as the net impact of litigation gains, are non-GAAP financial measures and should not be considered replacements for GAAP results. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measure can be found in the Investor Relations section of the Company's website at www.jnj.com.

NOTE TO INVESTORS

Johnson & Johnson will conduct a conference call with financial analysts to discuss this news release today at 8:30 a.m., Eastern Time. A simultaneous webcast of the meeting for investors and other interested parties may be accessed by visiting the Johnson & Johnson website at www.investor.jnj.com. A replay and podcast will be available approximately two hours after the live webcast by visiting www.investor.jnj.com.

Copies of the financial schedules accompanying this press release are available at www.investor.jnj.com/historical-sales.cfm. These schedules include supplementary sales data, a condensed consolidated statement of earnings, and sales of key products/franchises. Additional information on Johnson & Johnson, including a pharmaceutical pipeline of selected compounds in late stage development and medical devices and diagnostics pipeline of selected products, can be found on the Company's website at www.jnj.com

(This press release contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations of future events. If underlying assumptions prove inaccurate or unknown risks or uncertainties materialize, actual results could vary materially from Johnson & Johnson's expectations and projections. Risks and uncertainties include general industry conditions and competition; economic conditions, such as interest rate and currency exchange rate fluctuations; technological advances and patents attained by competitors; challenges inherent in new product development, including obtaining regulatory approvals; domestic and foreign health care reforms and governmental laws and regulations; and trends toward health care cost containment. A further list and description of these risks, uncertainties and other factors can be found in Exhibit 99 of Johnson & Johnson's Annual Report on Form 10-K for the fiscal year ended January 3, 2010. Copies of this Form 10-K, as well as subsequent filings, are available online at www.sec.gov, www.jnj.com or on request from Johnson & Johnson. Johnson & Johnson does not undertake to update any forward-looking statements as a result of new information or future events or developments.)

Johnson & Johnson and Subsidiaries
Supplementary Sales Data

(Unaudited; Dollars in Millions)	FIRST QUARTER
			Percent Change
	2010	2009	Total		Operations	Currency
Sales to customers by segment of business


Consumer
U.S.	1,560	1,726	(9.6)	%	(9.6)	-
International	2,206	1,985	11.1		1.4	9.7
	3,766	3,711	1.5		(3.7)	5.2

Pharmaceutical
U.S.	3,206	3,674	(12.7)		(12.7)	-
International	2,432	2,106	15.5		6.6	8.9
	5,638	5,780	(2.5)		(5.7)	3.2

Med Devices & Diagnostics
U.S.	2,886	2,652	8.8		8.8	-
International	3,341	2,883	15.9		7.5	8.4
	6,227	5,535	12.5		8.1	4.4

U.S.	7,652	8,052	(5.0)		(5.0)	-
International	7,979	6,974	14.4		5.5	8.9
Worldwide	$ 15,631	15,026	4.0	%	(0.1)	4.1

Johnson & Johnson and Subsidiaries
Supplementary Sales Data

(Unaudited; Dollars in Millions)	FIRST QUARTER
			Percent Change
	2010	2009	Total		Operations	Currency
Sales to customers by geographic area


U.S.	$ 7,652	8,052	(5.0)	%	(5.0)	-

Europe	4,102	3,671	11.7		4.6	7.1
Western Hemisphere excluding U.S.	1,280	1,062	20.5		3.5	17.0
Asia-Pacific, Africa	2,597	2,241	15.9		7.8	8.1
International	7,979	6,974	14.4		5.5	8.9

Worldwide	$ 15,631	15,026	4.0	%	(0.1)	4.1

Johnson & Johnson and Subsidiaries Condensed Consolidated Statement of Earnings

(Unaudited; in Millions Except Per Share Figures)	FIRST QUARTER
	2010			2009		Percent
			Percent		Percent	Increase
	Amount		to Sales	Amount	to Sales	(Decrease)
Sales to customers	$ 15,631		100.0	$ 15,026	100.0	4.0
Cost of products sold	4,528		29.0	4,251	28.3	6.5
Selling, marketing and administrative expenses	4,779		30.5	4,608	30.7	3.7
Research expense	1,557		10.0	1,518	10.1	2.6
Interest (income)expense, net	81		0.5	81	0.5
Other (income)expense, net	(1,594)		(10.2)	(75)	(0.5)
Earnings before provision for taxes on income	6,280		40.2	4,643	30.9	35.3
Provision for taxes on income	1,754		11.2	1,136	7.6	54.4
Net earnings	$ 4,526		29.0	$ 3,507	23.3	29.1


Net earnings per share (Diluted)	$ 1.62			$ 1.26		28.6

Average shares outstanding (Diluted)	2,797.3			2,789.8

Effective tax rate	27.9 %			24.5 %

Adjusted earnings before provision for taxes and net earnings
Earnings before provision for taxes on income	$ 4,783	(1)	30.6	$ 4,643	30.9	3.0
Net earnings	$ 3,616	(1)	23.1	$ 3,507	23.3	3.1
Net earnings per share (Diluted)	$ 1.29	(1)		$ 1.26		2.4
Effective tax rate	24.4%			24.5%

(1) The difference between as reported earnings and as adjusted earnings before provision for taxes on income, net earnings and net earnings per share (diluted) is the exclusion of income from net litigation of $1,497 million, $910 million and $0.33 per share, respectively.

	REPORTED SALES vs. PRIOR PERIOD ($MM)
	FIRST QUARTER
			% Change
	2010	2009	Reported	Operational ⁽¹⁾	Currency
CONSUMER SEGMENT ⁽²⁾
SKIN CARE
US	452	423	6.9%	6.9%	-
Intl	468	419	11.7%	2.4%	9.3%
WW	920	842	9.3%	4.6%	4.7%
BABY CARE
US	103	102	1.0%	1.0%	-
Intl	426	387	10.1%	1.2%	8.9%
WW	529	489	8.2%	1.2%	7.0%
ORAL CARE
US	174	188	-7.4%	-7.4%	-
Intl	207	177	16.9%	5.1%	11.8%
WW	381	365	4.4%	-1.3%	5.7%
OTC/NUTRITIONALS
US	542	726	-25.3%	-25.3%	-
Intl	665	622	6.9%	-2.7%	9.6%
WW	1,207	1,348	-10.5%	-15.0%	4.5%
WOMEN'S HEALTH
US	146	149	-2.0%	-2.0%	-
Intl	323	274	17.9%	7.8%	10.1%
WW	469	423	10.9%	4.4%	6.5%
WOUND CARE / OTHER
US	143	138	3.6%	3.6%	-
Intl	117	106	10.4%	-	10.4%
WW	260	244	6.6%	2.1%	4.5%
TOTAL CONSUMER
US	1,560	1,726	-9.6%	-9.6%	-
Intl	2,206	1,985	11.1%	1.4%	9.7%
WW	3,766	3,711	1.5%	-3.7%	5.2%


* See footnotes below

PHARMACEUTICAL SEGMENT ^{(2) (5)}
ACIPHEX/PARIET
US	119	138	-13.8%	-13.8%	-
Intl	141	125	12.8%	3.1%	9.7%
WW	260	263	-1.1%	-5.7%	4.6%
CONCERTA
US	231	269	-14.1%	-14.1%	-
Intl	98	75	30.7%	17.3%	13.4%
WW	329	344	-4.4%	-7.3%	2.9%
DURAGESIC/FENTANYL TRANSDERMAL
US	38	75	-49.3%	-49.3%	-
Intl	146	156	-6.4%	-13.4%	7.0%
WW	184	231	-20.3%	-25.1%	4.8%
LEVAQUIN/FLOXIN
US	363	408	-11.0%	-11.0%	-
Intl	8	17	-52.9%	-56.3%	3.4%
WW	371	425	-12.7%	-12.8%	0.1%
PREZISTA
US	89	72	23.6%	23.6%	-
Intl	98	50	96.0%	80.3%	15.7%
WW	187	122	53.3%	46.8%	6.5%
PROCRIT/EPREX
US	290	321	-9.7%	-9.7%	-
Intl	233	229	1.7%	-6.2%	7.9%
WW	523	550	-4.9%	-8.2%	3.3%
REMICADE
US	780	737	5.8%	5.8%	-
US Exports ⁽³⁾	400	286	39.9%	39.9%	-
Intl	6	5	20.0%	19.9%	0.1%
WW	1,186	1,028	15.4%	15.4%	-
RISPERDAL/RISPERIDONE
US	5	118	-95.8%	-95.8%	-
Intl	133	157	-15.3%	-20.1%	4.8%
WW	138	275	-49.8%	-52.5%	2.7%
RISPERDAL CONSTA
US	117	126	-7.1%	-7.1%	-
Intl	262	199	31.7%	21.4%	10.3%
WW	379	325	16.6%	10.3%	6.3%
TOPAMAX
US	57	495	-88.5%	-88.5%	-
Intl	91	107	-15.0%	-21.6%	6.6%
WW	148	602	-75.4%	-76.6%	1.2%
VELCADE
US	-	-	-	-	-
Intl	261	192	35.9%	26.3%	9.6%
WW	261	192	35.9%	26.3%	9.6%
OTHER
US	717	629	14.0%	14.0%	-
Intl	955	794	20.3%	11.1%	9.2%
WW	1,672	1,423	17.5%	12.4%	5.1%
TOTAL PHARMACEUTICAL
US	3,206	3,674	-12.7%	-12.7%	-
Intl	2,432	2,106	15.5%	6.6%	8.9%
WW	5,638	5,780	-2.5%	-5.7%	3.2%
MAJOR NEW PHARM PRODUCTS⁽⁴⁾
INVEGA
US	69	66	4.5%	4.5%	-
Intl	39	25	56.0%	43.2%	12.8%
WW	108	91	18.7%	15.1%	3.6%

* See footnotes below

MEDICAL DEVICES AND DIAGNOSTICS⁽²⁾
CORDIS ⁽⁶⁾
US	251	246	2.0%	2.0%	-
Intl	421	422	-0.2%	-6.3%	6.1%
WW	672	668	0.6%	-3.3%	3.9%
DEPUY
US	814	766	6.3%	6.3%	-
Intl	640	526	21.7%	11.2%	10.5%
WW	1,454	1,292	12.5%	8.2%	4.3%
DIABETES CARE
US	290	270	7.4%	7.4%	-
Intl	307	271	13.3%	5.4%	7.9%
WW	597	541	10.4%	6.4%	4.0%
ETHICON
US	510	405	25.9%	25.9%	-
Intl	637	548	16.2%	7.6%	8.6%
WW	1,147	953	20.4%	15.5%	4.9%
ETHICON ENDO-SURGERY
US	483	454	6.4%	6.4%	-
Intl	685	561	22.1%	12.9%	9.2%
WW	1,168	1,015	15.1%	10.0%	5.1%
ORTHO-CLINICAL DIAGNOSTICS
US	288	277	4.0%	4.0%	-
Intl	237	190	24.7%	16.1%	8.6%
WW	525	467	12.4%	8.9%	3.5%
VISION CARE
US	249	234	6.4%	6.4%	-
Intl	415	365	13.7%	6.9%	6.8%
WW	664	599	10.9%	6.8%	4.1%
TOTAL MEDICAL DEVICES AND DIAGNOSTICS
US	2,886	2,652	8.8%	8.8%	-
Intl	3,341	2,883	15.9%	7.5%	8.4%
WW	6,227	5,535	12.5%	8.1%	4.4%

(1) Operational growth excludes the effect of currency
(2) Select areas (unaudited)
(3) Reported in U.S. sales
(4) Included in Other
(5) Prior year conforms to current year presentation
(6) Includes sales of Drug-Eluting Stents for Q1 2010 of $60, $131 and $191MM Domestic, International and Worldwide respectively
Includes sales of Drug-Eluting Stents for Q1 2009 of $67, $184 and $251MM Domestic, International and Worldwide respectively