Sales of medical devices fell because the pandemic disrupted procedures at hospitals.
Scott Eells/Bloomberg
The drug giant Johnson & Johnson is enthusiastic about its prospects.
In its quarterly earnings report issued Tuesday morning, the firm said it expects adjusted diluted earnings per share of between $9.40 and $9.60 in 2021. That’s well above Wall Street expectations: Analysts project EPS of $8.96 for 2021, according to FactSet.
“Johnson & Johnson was built for times like these, and I am extremely confident in our ability to deliver lasting value and continued innovation in 2021 and for years to come,” the company’s CEO, Alex Gorksy, said in a statement.
Shares of Johnson & Johnson (ticker: JNJ) were up 2% in premarket trading shortly after the earnings were released.
Both sales and earnings per share for the latest quarter were also better than expected. The company reported fourth-quarter sales of $22.5 billion, slightly beating the FactSet consensus estimate of $21.7 billion. And it reported fourth-quarter adjusted earnings per share of $1.86, also a bit above the FactSet call of $1.82.
“JNJ’s 4Q20 sales and EPS beat as well as positive outlook for 2021, reflect solid performance and positive trends across its diversified business model,” said Cantor Fitzgerald analyst Louise Chen in a note out early Tuesday.
Sales in the company’s consumer health division rose 3.1% in 2020 on an adjusted operational basis, while sales in the company’s pharmaceutical division rose 8.1%. Sales at the company’s medical-device division were down 10.5%, as the Covid-19 pandemic disrupted elective procedures in hospitals around the world. Overall sales were up 1.5% on an adjusted operational basis.
The earnings report came amid enormous anticipation for Phase 3 data on the company’s Covid-19 vaccine, which can be delivered in a single dose. In a statement, Gorsky said that he looked “forward to sharing details from our Phase 3 study soon,” but the news release offered no further information.
The Johnson & Johnson vaccine study took on extra importance on Monday, when Merck (MRK) announced that it was giving up on its two Covid-19 vaccine programs following disappointing trial results.
Johnson & Johnson will discuss its earnings on a call at 8:30 a.m. Eastern. Questions about the vaccine program are likely.
In its press release, the company attributed the significant jump in pharmaceutical sales to drugs like Stelara, which treats conditions like Crohn’s disease; Darzalex, for multiple myeloma; Imbruvica, another cancer drug; and others. It said it saw declines in sales of Remicade, another Crohn’s disease drug, among other products.
The company said that the drop in medical-devices sales was due to the pandemic. “The decline was primarily driven by the negative impact of the COVID-19 pandemic and the associated deferral of medical procedures to our Surgery, Orthopaedics, and Vision businesses,” the company said.
Write to Josh Nathan-Kazis at [email protected]
