Johnson & Johnson (JNJ) reported better-than-expected first-quarter results, helped by strong demand for its cancer drugs. It also raised its revenue guidance for the full year, however kept its earnings outlook unchanged saying certain divestments it previously planned to make in 2018 might be pushed into next year.
J&J shares slipped more than 1 percent in the mid-day trading on Tuesday apparently because of not revising its profit guidance.
The healthcare conglomerate said sales of its cancer drugs climbed 45 percent to $2.31 billion in the quarter.
J&J’s famous rheumatoid arthritis drug Remicade’s sales were not up to the mark amid intense competition from inexpensive alternatives and cheaper copies, which pushed the company to focus on newer drugs including cancer treatments. Remicade’s sales plummeted 16.9 percent to $1.39 billion in the latest quarter.
The New Jersey-based company said it intends to streamline its supply chain across the globe and expects to save $600 million to $800 million, before taxes, in the next five years.
J&J also plans to increase its capital expenditure by 15 percent in the U.S. that would bring the total to $30 billion by 2022.
Overall, the company posted net earnings of $4.37 billion, or $1.60 a share in the first quarter, down from $4.42 billion, or $1.61 a share, in the comparable quarter last year. On an adjusted basis, earnings were $2.06 a share. Analysts surveyed by Thomson Reuters were looking for earnings of $2.02 a share.
Revenue for the quarter came in at $20.01 billion, up 12.6 percent from the same period last year, and also above consensus forecast of $19.46 billion.
J&J’s consumer products unit generated revenue of $3.40 billion in the quarter, up 5.3 percent versus last year.
Looking forward, the company expects sales in a range of $81.0 billion to $81.8 billion for the full year, as compared to its previous forecast in between $80.6 billion and $81.4 billion