Jones Lang LaSalle


Johnson & Johnson quarterly profit soars 79%
January 24, 2006

Johnson & Johnson posted a 79% increase in fourth-quarter profit, mainly due to lower overhead costs and a large tax charge a year ago.

(AP) — Johnson & Johnson posted a 79% increase in fourth-quarter profit Tuesday, mainly due to lower overhead costs and a large tax charge a year ago. While the earnings were in line with Wall Street expectations, revenue was below estimates. Its shares fell more than 2%. The maker of contraceptives, contact lenses, prescription drugs and baby and skin care products said that net income totaled $2.2 billion, or 73 cents per share, for the three months ended Dec. 31 versus $1.2 billion, or 41 cents a share, a year ago.

The year-ago figures were depressed by a $789 million charge for repatriating foreign profits. J&J would have earned $2 billion, or 67 cents per share, without that charge. New Brunswick, N.J.-based J&J said sales dipped to $12.61 billion, from $12.75 billion a year earlier, when the quarter had one additional week. Most of the company's revenue growth has been coming from overseas, where profit margins are lower and marketing can be more difficult.

Analysts surveyed by Thomson Financial were expecting earnings per share of 73 cents and revenues of $13.2 billion. The report was released as J&J faces a Tuesday night deadline to raise its bid or let rival Boston Scientific Corp. acquire heart device maker Guidant Corp. J&J officials refused to discuss the Guidant deal during a morning conference call with analysts, and J&J spokesman Marc Monseau said at noon that the company had no comment. For the full year, J&J reported net income of $10.4 billion, or $3.46 per share, up from $8.5 billion, or $2.84 per share, a year earlier. Revenue for all of 2005 totaled $50.51 billion, up nearly 7% from $47.35 in 2004. Johnson & Johnson shares fell $1.44, or 2.4%, to $59.75 in afternoon trading on the New York Stock Exchange.