Q4 2021 Covid and JNJ earnings

Janssen Johnson & Johnson vaccine against COVID-19.

Allen J. Shaben | Los Angeles Times | Getty Images

Johnson & Johnson forecast on Tuesday that its Covid vaccine will generate between $3 billion and $3.5 billion in sales in 2022, following a controversial fourth-quarter report that slightly beat earnings estimates but fell short of earnings.

Here’s how they fared compared to Wall Street’s expectations based on Refinitiv’s average analyst estimates:

  • Adjusted earnings per share: $2.13 vs. expected $2.12.
  • Income: $24.8 billion vs. expected $25.29 billion

Unadjusted, J&J’s fourth-quarter earnings rose to $4.74 billion, almost triple the $1.74 billion it earned in the same quarter the previous year. Its $24.8 billion in revenue was up 10.4% from $22.48 billion in the same quarter of 2020, driven mainly by $1.82 billion in international sales of the Covid vaccine.

The company’s shares fell nearly 2% in premarket trading.

Chief Financial Officer Joseph Volk told CNBC that the strength of the dollar negatively impacted $150 million to $200 million in sales. The shortage of staff in hospitals caused by the omicron Covid variant has also created uncertainty in the medical device company’s business, especially around elective procedures, Volk said. He added that the consumer health division has been hit by restrictions on the supply of raw materials, labor shortages among third-party manufacturers and higher transportation costs.

“We think it’s short-lived,” CNBC’s Wolf’s Meg Tyrrell told Squawk Box. “We think the second half of 2022 will be stronger than the first half, but some of these trends will continue into the beginning of this year.”

J&J reported sales of $93.77 billion in 2021, up 13.6% from the previous year. The company’s pharmaceutical division generated $52.08 billion in revenue, up 14.3% year-over-year. J&J’s medical device division reported sales of $27.06 in 2021, up 17.9% from 2020. Consumer Health Division revenue was $14.63 billion, up 4.1%.

J&J said it expects earnings per share of $10.40 to $10.60 this year and revenue of $98.9 billion to $100.4 billion.

CEO Joaquín Duato will head the J&J earnings report this morning for the first time in his new role. Earlier this month, Duato officially took over the reins from Alex Gorsky.

The fourth quarter results mark the end of a challenging year for J&J. Public confidence in the company’s single dose Covid-19 vaccine was shattered in December when the Centers for Disease Control and Prevention recommended the Pfizer and Moderna vaccines over the J&J shot. The CDC found that dozens of people, mostly young women, developed a rare thrombosis after being vaccinated with J&J.

In June, J&J lost a Supreme Court appeal for $2.1 billion in damages awarded by a lower court to women who said asbestos in the company’s talc caused ovarian cancer.

J&J is also decoupling its consumer goods business from its pharmaceutical and medical device operations to create two public companies. J&J expects to close the deal by the end of 2023.

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