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Johnson & Johnson Reports 2020 Third-Quarter Results
Oct 13, 2020
- Sales of $21.1 billion reflecting an overall and operational increase of 1.7%*, and adjusted operational increase of 2.0%* despite the estimated negative impact of the COVID-19 pandemic
 
- EPS of $1.33 increased 101.5%; adjusted EPS of $2.20 increased 3.8%*
 
- Company increasing guidance for Full Year Reported Sales by $1.0 billion and Adjusted EPS by $0.15 driven by the strength of the recovery and strong underlying business fundamentals

NEW BRUNSWICK, N.J., Oct. 13, 2020 /PRNewswire/ -- Johnson & Johnson (NYSE: JNJ) today announced results for third-quarter 2020.  "Our third-quarter results reflect solid performance and positive trends across Johnson & Johnson, powered by better-than-expected procedure recovery in Medical Devices, growth in Consumer Health, and continued strength in Pharmaceuticals," said Alex Gorsky, Chairman and Chief Executive Officer. "I am proud of the relentless passion and Credo-led commitment to patients and customers that our colleagues around the world continue to demonstrate as we boldly fight the COVID-19 pandemic. Our world-class R&D team is working tirelessly to advance the Phase 3 trials of our COVID-19 vaccine and to uphold the highest standards of transparency, safety and efficacy; while other dedicated teams provide ongoing support to hospitals and patients as they return to sites of care, and ensure patients and consumers have the medicines and products they need. This resilient mindset, combined with our strategic capabilities and execution excellence, increase our optimism for continued recovery in 2020 and strong momentum entering into 2021."

OVERALL FINANCIAL RESULTS:

 

THIRD QUARTER

 

($ in Millions, except EPS)

2020

2019

%  Change

Reported Sales

$ 21,082

$ 20,729

1.7%

Net Earnings

3,554

1,753

102.7%

EPS (diluted)

$      1.33

$      0.66

101.5%

       

Non-GAAP*

THIRD QUARTER

 

($ in Millions, except EPS)

2020

2019

%  Change

Operational Sales1,2

N/A

N/A

1.7%

Adjusted Operational Sales1,3

N/A

N/A

2.0%

Adjusted Net Earnings1,4

5,868

5,672

3.5%

Adjusted EPS (diluted)1,4

$      2.20

$      2.12

3.8%

 

1 Non-GAAP financial measure; refer to reconciliations of non-GAAP financial measures included in accompanying schedules 

2 Excludes the impact of translational currency

3 Excludes the net impact of acquisitions and divestitures and translational currency

4 Excludes intangible amortization expense and special items

REGIONAL SALES RESULTS:

 

THIRD QUARTER

%  Change


($ in Millions) 1


20202


20192


Reported2


Operational1,2


Currency2

Adjusted
Operational1,3

U.S.

$ 11,086

$ 10,791

2.7%

2.7%

-

2.8

International

9,996

9,938

0.6%

0.6%

0.0

1.1

Worldwide

$ 21,082

$ 20,729

1.7%

1.7%

0.0

2.0

 

1 Non-GAAP financial measure; refer to reconciliations of non-GAAP financial measures included in accompanying schedules

2 Excludes the impact of translational currency

3 Excludes the net impact of acquisitions and divestitures and translational currency

  Note: values may have been rounded

SEGMENT SALES RESULTS:

 

THIRD QUARTER

%  Change


($ in Millions) 1


20201


20191


Reported2


Operational1,2


Currency1

Adjusted
Operational1,3

Consumer Health

$       3,514

$       3,469

1.3%

3.0

(1.7)

3.1

Pharmaceutical

11,418

10,877

5.0%

4.6

0.4

4.7

Medical Devices

6,150

6,383

(3.6)%

(3.9)

0.3

(3.3)

Worldwide

$     21,082

$     20,729

1.7%

1.7

0.0

2.0

 

1 Non-GAAP financial measure; refer to reconciliations of non-GAAP financial measures included in accompanying schedules

2 Excludes the impact of translational currency

3 Excludes the net impact of acquisitions and divestitures and translational currency

  Note: values may have been rounded

SEGMENT COMMENTARY:

Consumer Health
Consumer Health worldwide operational sales, excluding the net impact of acquisitions and divestitures, increased by 3.1%*, inclusive of the net negative impact of COVID-19 primarily in international over-the-counter products.  Sales growth was driven by U.S. growth in over-the-counter products including TYLENOL analgesics and digestive health products; LISTERINE mouthwash in oral care products; OGX in skin health/beauty products; and wound care products, primarily BAND-AID® Brand Adhesive Bandages. 

Pharmaceutical
Pharmaceutical worldwide operational sales, excluding the net impact of acquisitions and divestitures, grew 4.7%* driven by DARZALEX (daratumumab), for the treatment of multiple myeloma, STELARA (ustekinumab), a biologic for the treatment of a number of immune-mediated inflammatory diseases, IMBRUVICA (ibrutinib), an oral, once-daily therapy approved for use in treating certain B-cell malignancies, a type of blood or lymph node cancer, INVEGA SUSTENNA/XEPLION/INVEGA TRINZA/TREVICTA (paliperidone palmitate), long-acting, injectable atypical antipsychotics for the treatment of schizophrenia in adults, OPSUMIT (macitentan), an oral endothelin receptor antagonist indicated for the treatment of pulmonary arterial hypertension to delay disease progression, UPTRAVI (selexipag), an oral prostacyclin receptor agonist used to treat pulmonary arterial hypertension and reduce hospitalization, and ERLEADA (apalutamide), a next-generation androgen receptor inhibitor for the treatment of patients with prostate cancer. This growth was partially offset by the negative impact of COVID-19 as well as biosimilar and generic competition, with declines primarily in REMICADE (infliximab), a biologic approved for the treatment of a number of immune-mediated inflammatory diseases, and ZYTIGA (abiraterone acetate), an oral, once-daily medication for use in combination with prednisone for the treatment of metastatic castration-resistant prostate cancer.

Medical Devices
Medical Devices worldwide operational sales, excluding the net impact of acquisitions and divestitures, declined by 3.3%*.  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. Results reflect market recovery versus the second quarter. The decline was partially offset by growth in the Interventional Solutions business led by electrophysiology products.

NOTABLE NEW ANNOUNCEMENTS IN THE QUARTER:
The information contained in this section should be read in conjunction with Johnson & Johnson's other disclosures filed with the Securities and Exchange Commission, including its Current Reports on Form 8-K, Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K. Copies of these filings are available online at www.sec.gov, www.jnj.com or on request from Johnson & Johnson. The reader is also encouraged to review all other news releases available online in the Investors section of the Company's website at news releases.

Regulatory Approvals

THERMOCOOL SMARTTOUCH – Biosense Webster Receives FDA Approval for SF Ablation Catheter for the Treatment of Persistent Atrial Fibrillation¹

(press release)

SIMPONI ARIA (golimumab) – Approved by the U.S. Food and Drug Administration for Active Polyarticular Juvenile Idiopathic Arthritis and Extension of Its Active Psoriatic Arthritis Indication in Patients 2 Years of Age and Older

(press release)

SPRAVATO (esketamine) – Janssen Announces U.S. FDA Approval of CIII Nasal Spray to Treat Depressive Symptoms in Adults with Major Depressive Disorder with Acute Suicidal Ideation or Behavior

(press release)

DARZALEX (daratumumab) – U.S. FDA Approves New DARZALEX-Based Combination Regimen for Patients with Relapsed/Refractory Multiple Myeloma

(press release)

 

STELARA (ustekinumab) – U.S. Food and Drug Administration Approves Treatment of Pediatric Patients with Moderate to Severe Plaque Psoriasis

(press release)

Regulatory Submissions

UPTRAVI (selexipag) – Janssen Submits New Drug Application (NDA) to U.S. FDA for Injection for Intravenous Use to Treat Pulmonary Arterial Hypertension (PAH)

(press release) 

 

DARZALEX FASPRO (daratumumab and hyaluronidase-fihj) – Janssen Submits Application Seeking U.S. FDA Approval for the Treatment of Patients with Light Chain (AL) Amyloidosis

(press release)

Other

Johnson & Johnson Announces European Commission Approval of Agreement to Supply 200 Million Doses of Janssen's COVID-19 Vaccine Candidate ¹

(press release)

Johnson & Johnson Completes Acquisition of Momenta Pharmaceuticals, Inc.¹

(press release)

Johnson & Johnson Initiates Pivotal Global Phase 3 Clinical Trial of Janssen's COVID-19 Vaccine Candidate

(press release)

CERENOVUS Launches New Suite of Technologies to Advance Stroke Treatment

(press release)

Johnson & Johnson Announces that Janssen's COVID-19 Investigational Vaccine Candidate Prevents Severe Clinical Disease in Pre-clinical Studies

(press release)

Janssen to Discontinue Pimodivir Influenza Development Program

(press release)

Johnson & Johnson Announces Agreement with U.S. Government for 100 Million Doses of Investigational COVID-19 Vaccine

(press release)

U.S. FDA Grants Ethicon Breakthrough Device Designation for Monarch-enabled NeuWave Microwave Ablation Technology

(press release)

 

1 Subsequent to the quarter

FULL-YEAR 2020 GUIDANCE:
Johnson & Johnson does not provide GAAP financial measures on a forward-looking basis because the Company is unable to predict with reasonable certainty the ultimate outcome of legal proceedings, unusual gains and losses, acquisition-related expenses and purchase accounting fair value adjustments without unreasonable effort. These items are uncertain, depend on various factors, and could be material to Johnson & Johnson's results computed in accordance with GAAP.

The estimated impact of the COVID-19 pandemic is included in the guidance below.

 

October 2020

July 2020

     

($ in Billions, except EPS) 

   

Adjusted Operational Sales1,2

Change vs. Prior Year

0.5% – 1.5%

(0.8%) – 1.0%

Operational Sales2

Change vs. Prior Year

$82.0 to $82.8

0.0% – 1.0%

$81.0 to $82.5

(1.3%) – 0.5%

Estimated Reported Sales3

Change vs. Prior Year

$81.2 to $82.0

(1.0%) – 0.0%

$79.9 to $81.4

(2.6%) – (0.8%)

     

Adjusted Operational EPS (Diluted)2,4

Change vs. Prior Year

$7.95 to $8.05

(8.4%) - (7.3%)

$7.85 to $8.05

(9.6%) - (7.3%)

 Adjusted EPS (Diluted)3,4

Change vs. Prior Year

$7.95 to $8.05

(8.4%) – (7.3%)

$7.75 to $7.95

(10.7%) – (8.4%)

 

1 Non-GAAP financial measure; excludes the net impact of acquisitions and divestitures

2 Non-GAAP financial measure; excludes the impact of translational currency

3 Calculated using Euro Average Rate: October 2020 = $1.14 Euro Average Rate: July 2020 = $1.12 (Illustrative purposes only)

Non-GAAP financial measure; excludes intangible amortization expense and special items

Other modeling considerations will be provided on the webcast.

WEBCAST INFORMATION:
Johnson & Johnson will conduct a conference call with investors to discuss this earnings release today at 8:30 a.m., Eastern Time. A simultaneous webcast of the call for investors and other interested parties may be accessed by visiting the Johnson & Johnson website. A replay and podcast will be available approximately two hours after the live webcast in the Investors section of the Company's website at events-and-presentations

ABOUT JOHNSON & JOHNSON:
At Johnson & Johnson, we believe good health is the foundation of vibrant lives, thriving communities and forward progress. That's why for more than 130 years, we have aimed to keep people well at every age and every stage of life. Today, as the world's largest and most broadly-based health care company, we are committed to using our reach and size for good. We strive to improve access and affordability, create healthier communities, and put a healthy mind, body and environment within reach of everyone, everywhere. We are blending our heart, science and ingenuity to profoundly change the trajectory of health for humanity.

NON-GAAP FINANCIAL MEASURES:
*Operational sales growth excluding the impact of translational currency, adjusted operational sales growth excluding the net impact of acquisitions and divestitures and translational currency, as well as adjusted net earnings, adjusted diluted earnings per share and adjusted operational diluted earnings per share excluding after-tax intangible amortization expense and special items, are non-GAAP financial measures and should not be considered replacements for, and should be read together with, the most comparable GAAP financial measures. Except for guidance measures, reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures can be found in the accompanying financial schedules of the earnings release and the Investors section of the Company's website at quarterly-results.

Copies of the financial schedules accompanying this earnings release are available on the Company's website at quarterly-results. These schedules include supplementary sales data, a condensed consolidated statement of earnings, reconciliations of non-GAAP financial measures, and sales of key products/franchises. Additional information on Johnson & Johnson, including adjusted income before tax by segment, a pharmaceutical pipeline of selected compounds in late stage development and a copy of today's earnings call presentation can also be found in the Investors section of the Company's website at quarterly-results.

NOTE TO INVESTORS CONCERNING FORWARD-LOOKING STATEMENTS:
This press release contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995 regarding, among other things: future operating and financial performance, product development, market position and business strategy. The reader is cautioned not to rely on these forward-looking statements. These statements are based on current expectations of future events. If underlying assumptions prove inaccurate or known or unknown risks or uncertainties materialize, actual results could vary materially from the expectations and projections of Johnson & Johnson. Risks and uncertainties include, but are not limited to: risks related to the impact of the COVID-19 global pandemic, such as the scope and duration of the outbreak, government actions and restrictive measures implemented in response, material delays and cancellations of medical procedures, supply chain disruptions and other impacts to the business, or on the Company's ability to execute business continuity plans, as a result of the COVID-19 pandemic, economic factors, such as interest rate and currency exchange rate fluctuations; competition, including technological advances, new products and patents attained by competitors; challenges inherent in new product research and development, including uncertainty of clinical success and obtaining regulatory approvals; uncertainty of commercial success for new and existing products; challenges to patents; the impact of patent expirations; the ability of the Company to successfully execute strategic plans; the impact of business combinations and divestitures; manufacturing difficulties or delays, internally or within the supply chain; product efficacy or safety concerns resulting in product recalls or regulatory action; significant adverse litigation or government action, including related to product liability claims; changes to applicable laws and regulations, including tax laws and global health care reforms; trends toward health care cost containment; changes in behavior and spending patterns of purchasers of health care products and services; financial instability of international economies and legal systems and sovereign risk; increased scrutiny of the health care industry by government agencies. A further list and descriptions of these risks, uncertainties and other factors can be found in Johnson & Johnson's Annual Report on Form 10-K for the fiscal year ended December 29, 2019, including in the sections captioned "Cautionary Note Regarding Forward-Looking Statements" and "Item 1A. Risk Factors," in the Company's most recently filed Quarterly Report on Form 10-Q and the Company's subsequent filings with the Securities and Exchange Commission. Copies of these filings are available online at www.sec.gov, www.jnj.com or on request from Johnson & Johnson. Any forward-looking statement made in this release speaks only as of the date of this release. Johnson & Johnson does not undertake to update any forward-looking statement as a result of new information or future events or developments.

Johnson & Johnson and Subsidiaries

                   

Supplementary Sales Data

                   
                                       

(Unaudited; Dollars in Millions)

THIRD QUARTER

 

NINE MONTHS

         

 Percent Change

         

Percent Change

 

2020

 

2019

 

Total

 

Operations

 

Currency

 

2020

 

2019

 

Total

 

Operations

 

Currency

Sales to customers by

                                     

segment of business

                                     
                                       

Consumer Health

                                     

 U.S.

$   1,556

 

1,394

 

11.6

%

11.6

 

-

 

$   4,853

 

4,369

 

11.1

%

11.1

 

-

    International

1,958

 

2,075

 

(5.6)

 

(2.7)

 

(2.9)

 

5,582

 

5,962

 

(6.4)

 

(2.2)

 

(4.2)

 

3,514

 

3,469

 

1.3

 

3.0

 

(1.7)

 

10,435

 

10,331

 

1.0

 

3.4

 

(2.4)

                                       

Pharmaceutical

                                     

 U.S.

6,438

 

6,340

 

1.5

 

1.5

 

-

 

18,619

 

17,705

 

5.2

 

5.2

 

-

    International

4,980

 

4,537

 

9.7

 

8.8

 

0.9

 

14,685

 

13,945

 

5.3

 

7.4

 

(2.1)

 

11,418

 

10,877

 

5.0

 

4.6

 

0.4

 

33,304

 

31,650

 

5.2

 

6.1

 

(0.9)

                                       

Medical Devices

                                     

 U.S.

3,092

 

3,057

 

1.2

 

1.2

 

-

 

7,852

 

9,249

 

(15.1)

 

(15.1)

 

-

    International

3,058

 

3,326

 

(8.1)

 

(8.5)

 

0.4

 

8,518

 

10,082

 

(15.5)

 

(14.1)

 

(1.4)

 

6,150

 

6,383

 

(3.6)

 

(3.9)

 

0.3

 

16,370

 

19,331

 

(15.3)

 

(14.6)

 

(0.7)

                                       

U.S.

11,086

 

10,791

 

2.7

 

2.7

 

-

 

31,324

 

31,323

 

0.0

 

0.0

 

-

International

9,996

 

9,938

 

0.6

 

0.6

 

0.0

 

28,785

 

29,989

 

(4.0)

 

(1.7)

 

(2.3)

Worldwide

$ 21,082

 

20,729

 

1.7

 

1.7

 

0.0

 

$ 60,109

 

61,312

 

(2.0)

 

(0.8)

 

(1.2)

       

Note: Percentages have been calculated using actual, non-rounded figures and, therefore, may not recalculate precisely.

 

Johnson & Johnson and Subsidiaries

                   

Supplementary Sales Data

                   
                                       

(Unaudited; Dollars in Millions)

THIRD QUARTER

 

NINE MONTHS

         

Percent Change

         

Percent Change

 

2020

 

2019

 

Total

 

Operations

 

Currency

 

2020

 

2019

 

Total

 

Operations

 

Currency

Sales to customers by

                                     

geographic area

                                     
                                       

U.S.

$ 11,086

 

10,791

 

2.7

%

2.7

 

-

 

$ 31,324

 

31,323

 

0.0

%

0.0

 

-

                                       

Europe

4,819

 

4,461

 

8.0

 

4.6

 

3.4

 

13,709

 

13,803

 

(0.7)

 

0.1

 

(0.8)

Western Hemisphere excluding U.S.

1,296

 

1,488

 

(12.9)

 

(1.2)

 

(11.7)

 

3,931

 

4,446

 

(11.6)

 

(0.4)

 

(11.2)

Asia-Pacific, Africa

3,881

 

3,989

 

(2.7)

 

(3.2)

 

0.5

 

11,145

 

11,740

 

(5.1)

 

(4.3)

 

(0.8)

International

9,996

 

9,938

 

0.6

 

0.6

 

0.0

 

28,785

 

29,989

 

(4.0)

 

(1.7)

 

(2.3)

                                       

Worldwide

$ 21,082

 

20,729

 

1.7

%

1.7

 

0.0

 

$ 60,109

 

61,312

 

(2.0)

%

(0.8)

 

(1.2)

       

Note:Percentages have been calculated using actual, non-rounded figures and, therefore, may not recalculate precisely.

 

 

Johnson & Johnson and Subsidiaries

 

Condensed Consolidated Statement of Earnings 

 
                   

(Unaudited; in Millions Except Per Share Figures)

THIRD QUARTER

                   
 

2020

 

2019

 

Percent

     

Percent

     

Percent

 

Increase

 

Amount

 

to Sales

 

Amount

 

to Sales

 

(Decrease)

Sales to customers

$ 21,082

 

100.0

 

$ 20,729

 

100.0

 

1.7

Cost of products sold

6,972

 

33.1

 

6,867

 

33.1

 

1.5

Gross Profit

14,110

 

66.9

 

13,862

 

66.9

 

1.8

Selling, marketing and administrative expenses

5,431

 

25.8

 

5,374

 

26.0

 

1.1

Research and development expense

2,840

 

13.5

 

2,599

 

12.5

 

9.3

In-process research and development

138

 

0.6

 

-

 

-

   

Interest (income) expense, net

32

 

0.1

 

(41)

 

(0.2)

   

Other (income) expense, net

1,200

 

5.7

 

4,214

 

20.3

   

Restructuring

68

 

0.3

 

69

 

0.4

   

Earnings before provision for taxes on income

4,401

 

20.9

 

1,647

 

7.9

 

167.2

Provision for/(Benefit from) taxes on income

847

 

4.0

 

(106)

 

(0.6)

   

Net earnings

$   3,554

 

16.9

 

$   1,753

 

8.5

 

102.7

                   

Net earnings per share (Diluted)

$     1.33

     

$     0.66

     

101.5

                   

Average shares outstanding (Diluted)

2,669.3

     

2,669.9

       
                   

Effective tax rate

19.2

%

   

(6.4)

%

     
                   

Adjusted earnings before provision for taxes and net earnings (1)

                 

Earnings before provision for taxes on income

$   7,246

 

34.4

 

$   7,116

 

34.3

 

1.8

Net earnings

$   5,868

 

27.8

 

$   5,672

 

27.4

 

3.5

Net earnings per share (Diluted)

$     2.20

     

$     2.12

     

3.8

Effective tax rate

19.0

%

   

20.3

%

     
                   
 

(1)See Reconciliation of Non-GAAP Financial Measures.

 

 

Johnson & Johnson and Subsidiaries

 

Condensed Consolidated Statement of Earnings 

 
                   

(Unaudited; in Millions Except Per Share Figures)

NINE MONTHS

                   
 

2020

 

2019

 

Percent

     

Percent

     

Percent

 

Increase

 

Amount

 

to Sales

 

Amount

 

to Sales

 

(Decrease)

Sales to customers

$    60,109

 

100.0

 

$    61,312

 

100.0

 

(2.0)

Cost of products sold

20,613

 

34.3

 

20,422

 

33.3

 

0.9

Gross Profit

39,496

 

65.7

 

40,890

 

66.7

 

(3.4)

Selling, marketing and administrative expenses

15,627

 

26.0

 

16,139

 

26.3

 

(3.2)

Research and development expense

8,127

 

13.5

 

8,123

 

13.3

 

0.0

In-process research and development

144

 

0.3

 

890

 

1.4

   

Interest (income) expense, net

16

 

0.0

 

(43)

 

(0.1)

   

Other (income) expense, net

545

 

0.9

 

2,509

 

4.1

   

Restructuring

187

 

0.3

 

162

 

0.3

   

Earnings before provision for taxes on income

14,850

 

24.7

 

13,110

 

21.4

 

13.3

Provision for taxes on income

1,874

 

3.1

 

2,001

 

3.3

 

(6.3)

Net earnings

$    12,976

 

21.6

 

$    11,109

 

18.1

 

16.8

                   

Net earnings per share (Diluted)

$        4.86

     

$        4.13

     

17.7

                   

Average shares outstanding (Diluted)

2,670.8

     

2,688.1

       
                   

Effective tax rate

12.6

%

   

15.3

%

     
                   

Adjusted earnings before provision for taxes and net earnings (1)

                 

Earnings before provision for taxes on income

$    19,827

 

33.0

 

$    22,597

 

36.9

 

(12.3)

Net earnings

$    16,468

 

27.4

 

$    18,283

 

29.8

 

(9.9)

Net earnings per share (Diluted)

$        6.17

     

$        6.80

     

(9.3)

Effective tax rate

16.9

%

   

19.1

%

     
 

(1)See Reconciliation of Non-GAAP Financial Measures.

 

 

Johnson & Johnson and Subsidiaries

Reconciliation of Non-GAAP Financial Measures 

               
 

Third Quarter

 

Nine Months Ended

(Dollars in Millions Except Per Share Data)

2020

 

2019

 

2020

 

2019

Net Earnings, after tax- as reported

$3,554

 

$1,753

 

$12,976

 

$11,109

               

Pre-tax Adjustments 

             

Intangible Asset Amortization expense

1,181

 

1,138

 

3,426

 

3,386

Litigation expense, net

1,477

 

4,000

 

2,210

 

4,832

IPR&D

138

 

-

 

144

 

890

Restructuring related

130

 

128

 

363

 

360

Acquisition and Integration related ¹

(154)

 

107

 

(1,087)

 

229

Unrealized (gains)/losses on securities 

32

 

89

 

(174)

 

(217)

Medical Device Regulation2

38

 

-

 

89

 

-

Other

3

 

7

 

6

 

7

               

Tax Adjustments

             

Tax impact on special item adjustments 3

(482)

 

(1,159)

 

(1,002)

 

(1,922)

Tax legislation and related impacts 

(49)

 

(391)

 

(483)

 

(391)

Adjusted Net Earnings, after tax

$5,868

 

$5,672

 

$16,468

 

$18,283

Average shares outstanding (Diluted)

2,669.3

 

2,669.9

 

2,670.8

 

2,688.1

Adjusted net earnings per share (Diluted)

$2.20

 

$2.12

 

$6.17

 

$6.80

Operational adjusted net earnings per share (Diluted)

$2.17

     

$6.18

   
   
 

Notes:

1

Acquisition and integration related costs for 2020 primarily includes a Contingent Consideration reversal ($165M in third quarter and $1,148M in nine months) related to the timing of certain developmental milestones associated with the Auris Health acquisition. 

   

2

European Medical Device Regulation (MDR) costs represent one-time compliance costs for the Company's previously registered products. MDR is a replacement of the existing European Medical Devices Directive regulatory framework, and manufacturers of currently marketed medical devices are required to comply with EU MDR beginning in May 2021. The Company considers the adoption of EU MDR to be a significant one-time regulatory change and is not indicative of on-going operations.  The Company has excluded only external third-party regulatory and consulting costs from its Medical Devices operating segments' measures of profit and loss used for making operating decisions and assessing performance.

   

3

The tax impact related to special item adjustments reflects the current and deferred income taxes associated with the above pre-tax special items in arriving at adjusted earnings.

 

 

Johnson & Johnson and Subsidiaries

Reconciliation of Non-GAAP Financial Measure

                 

Adjusted Operational Sales Growth

 THIRD QUARTER 2020 ACTUAL vs. 2019 ACTUAL 

                 

 Segments 

                 
   

Consumer Health

 

 Pharmaceutical 

 

 Medical Devices 

 

 Total 

                 

 WW As Reported 

 

1.3%

 

5.0%

 

(3.6)%

 

1.7%

 U.S. 

 

11.6%

 

1.5%

 

1.2%

 

2.7%

 International 

 

(5.6)%

 

9.7%

 

(8.1)%

 

0.6%

                 

 WW Currency 

 

(1.7)

 

0.4

 

0.3

 

0.0

 U.S. 

 

-

 

-

 

-

 

-

 International 

 

(2.9)

 

0.9

 

0.4

 

0.0

                 

 WW Operational 

 

3.0%

 

4.6%

 

(3.9)%

 

1.7%

 U.S. 

 

11.6%

 

1.5%

 

1.2%

 

2.7%

 International 

 

(2.7)%

 

8.8%

 

(8.5)%

 

0.6%

                 

General Surgery

               

Advanced Sterilization Products

         

0.5

 

0.2

 U.S. 

         

0.0

 

0.0

 International 

         

0.9

 

0.4

                 

Baby Care

               

Baby Center

 

0.1

         

0.0

 U.S. 

 

0.4

         

0.1

 International 

 

0.0

         

0.0

                 

All Other Acquisitions and Divestitures

 

0.0

 

0.1

 

0.0

 

0.1

 U.S. 

 

0.0

 

0.0

 

0.1

 

0.0

 International 

 

(0.1)

 

0.3

 

0.0

 

0.1

                 

WW Adjusted Operational

 

3.1%

 

4.7%

 

(3.3)%

 

2.0%

 U.S. 

 

12.0%

 

1.5%

 

1.3%

 

2.8%

 International 

 

(2.8)%

 

9.2%

 

(7.6)%

 

1.1%

 

Note:Percentages are based on actual, non-rounded figures and may not sum

 

 

Johnson & Johnson and Subsidiaries

Reconciliation of Non-GAAP Financial Measure

 

Adjusted Operational Sales Growth

NINE MONTHS 2020 ACTUAL vs. 2019 ACTUAL

 

 Segments 

                 
   

Consumer Health

 

 Pharmaceutical 

 

 Medical Devices 

 

 Total 

                 

 WW As Reported 

 

1.0%

 

5.2%

 

(15.3)%

 

(2.0)%

 U.S. 

 

11.1%

 

5.2%

 

(15.1)%

 

0.0%

 International 

 

(6.4)%

 

5.3%

 

(15.5)%

 

(4.0)%

                 

 WW Currency 

 

(2.4)

 

(0.9)

 

(0.7)

 

(1.2)

 U.S. 

 

-

 

-

 

-

 

-

 International 

 

(4.2)

 

(2.1)

 

(1.4)

 

(2.3)

                 

 WW Operational 

 

3.4%

 

6.1%

 

(14.6)%

 

(0.8)%

 U.S. 

 

11.1%

 

5.2%

 

(15.1)%

 

0.0%

 International 

 

(2.2)%

 

7.4%

 

(14.1)%

 

(1.7)%

                 

Skin Health / Beauty

               

Dr. Ci Labo - Japan

 

(0.1)

         

0.0

 U.S. 

 

0.0

         

0.0

 International 

 

(0.2)

         

0.0

                 

General Surgery

               

Advanced Sterilization Products

         

0.9

 

0.3

 U.S. 

         

0.8

 

0.3

 International 

         

0.9

 

0.4

                 

Baby Care

               

Baby Center

 

0.2

         

0.0

 U.S. 

 

0.6

         

0.1

 International 

 

0.0

         

0.0

                 

All Other Acquisitions and Divestitures

 

(0.1)

 

0.2

 

0.0

 

0.1

 U.S. 

 

0.0

 

0.0

 

0.0

 

0.0

 International 

 

(0.1)

 

0.3

 

0.0

 

0.1

                 

WW Adjusted Operational

 

3.4%

 

6.3%

 

(13.7)%

 

(0.4)%

 U.S. 

 

11.7%

 

5.2%

 

(14.3)%

 

0.4%

 International 

 

(2.6)%

 

7.7%

 

(13.1)%

 

(1.3)%

 

Note:Percentages are based on actual, non-rounded figures and may not sum

 

 

 

REPORTED SALES vs. PRIOR PERIOD ($MM)

     

REPORTED SALES vs. PRIOR PERIOD ($MM)

 

THIRD QUARTER

     

NINE MONTHS

   

% Change

       

% Change

   

2020

 

2019

Reported

Operational (1)

Currency

       

2020

 

2019

Reported

Operational (1)

Currency

CONSUMER HEALTH SEGMENT (2,3) 

                                 

OTC

                                 

US

 

$         601

 

477

26.0%

26.0%

-

       

$        1,917

 

1,468

30.6%

30.6%

-

Intl

 

541

 

621

-12.9%

-12.9%

0.0%

       

1,722

 

1,781

-3.3%

-0.6%

-2.7%

WW

 

1,142

 

1,098

4.0%

4.0%

0.0%

       

3,639

 

3,249

12.0%

13.5%

-1.5%

SKIN HEALTH / BEAUTY(4)

                                 

US

 

572

 

559

2.4%

2.4%

-

       

1,767

 

1,810

-2.4%

-2.4%

-

Intl

 

577

 

592

-2.7%

-0.5%

-2.2%

       

1,506

 

1,633

-7.8%

-4.9%

-2.9%

WW

 

1,149

 

1,151

-0.2%

0.9%

-1.1%

       

3,273

 

3,443

-5.0%

-3.6%

-1.4%

ORAL CARE

                                 

US

 

164

 

156

5.5%

5.5%

-

       

510

 

462

10.4%

10.4%

-

Intl

 

248

 

223

10.7%

14.4%

-3.7%

       

694

 

673

3.0%

7.9%

-4.9%

WW

 

412

 

379

8.5%

10.8%

-2.3%

       

1,204

 

1,135

6.0%

8.9%

-2.9%

BABY CARE

                                 

US

 

91

 

91

-1.0%

-1.0%

-

       

279

 

277

0.5%

0.5%

-

Intl

 

302

 

326

-7.2%

-0.6%

-6.6%

       

831

 

977

-14.9%

-8.6%

-6.3%

WW

 

393

 

417

-5.9%

-0.7%

-5.2%

       

1,110

 

1,254

-11.5%

-6.6%

-4.9%

WOMEN'S HEALTH

                                 

US

 

3

 

3

-6.9%

-6.9%

-

       

10

 

9

7.3%

7.3%

-

Intl

 

227

 

252

-9.6%

-4.0%

-5.6%

       

654

 

724

-9.6%

-2.8%

-6.8%

WW

 

230

 

255

-9.6%

-4.1%

-5.5%

       

664

 

733

-9.4%

-2.7%

-6.7%

WOUND CARE / OTHER

                                 

US

 

125

 

109

15.2%

15.2%

-

       

370

 

343

8.0%

8.0%

-

Intl

 

64

 

59

7.4%

10.3%

-2.9%

       

175

 

173

1.3%

5.4%

-4.1%

WW

 

189

 

168

12.5%

13.5%

-1.0%

       

545

 

516

5.8%

7.2%

-1.4%

                                   

TOTAL CONSUMER HEALTH

                                 

US

 

1,556

 

1,394

11.6%

11.6%

-

       

4,853

 

4,369

11.1%

11.1%

-

Intl

 

1,958

 

2,075

-5.6%

-2.7%

-2.9%

       

5,582

 

5,962

-6.4%

-2.2%

-4.2%

WW

 

$      3,514

 

3,469

1.3%

3.0%

-1.7%

       

$      10,435

 

10,331

1.0%

3.4%

-2.4%

                                   
                                   

See footnotes at end of schedule

                             
                                   
                                   
                                   
 

REPORTED SALES vs. PRIOR PERIOD ($MM)

     

REPORTED SALES vs. PRIOR PERIOD ($MM)

 

THIRD QUARTER

     

NINE MONTHS

     

% Change

       

% Change

PHARMACEUTICAL SEGMENT (2,5)

 

2020

 

2019

Reported

Operational (1)

Currency

       

2020

 

2019

Reported

Operational (1)

Currency

                                   

IMMUNOLOGY

                                 

US

 

$      2,558

 

2,582

-0.9%

-0.9%

-

       

$        7,330

 

7,124

2.9%

2.9%

-

Intl

 

1,230

 

1,129

9.0%

8.4%

0.6%

       

3,619

 

3,304

9.5%

11.9%

-2.4%

WW

 

3,789

 

3,711

2.1%

1.9%

0.2%

       

10,950

 

10,428

5.0%

5.7%

-0.7%

REMICADE

                                 

US 

 

634

 

749

-15.4%

-15.4%

-

       

1,852

 

2,324

-20.3%

-20.3%

-

US Exports (6)

 

78

 

88

-11.3%

-11.3%

-

       

321

 

226

42.1%

42.1%

-

Intl

 

209

 

299

-30.1%

-28.0%

-2.1%

       

673

 

795

-15.3%

-11.6%

-3.7%

WW

 

921

 

1,136

-18.9%

-18.4%

-0.5%

       

2,846

 

3,345

-14.9%

-14.0%

-0.9%

SIMPONI / SIMPONI ARIA

                                 

US

 

312

 

313

-0.4%

-0.4%

-

       

840

 

857

-2.0%

-2.0%

-

Intl

 

280

 

273

2.4%

2.2%

0.2%

       

827

 

816

1.3%

3.9%

-2.6%

WW

 

592

 

586

0.9%

0.8%

0.1%

       

1,667

 

1,673

-0.4%

0.9%

-1.3%

STELARA

                                 

US

 

1,313

 

1,212

8.4%

8.4%

-

       

3,668

 

3,152

16.4%

16.4%

-

Intl

 

634

 

487

30.3%

28.1%

2.2%

       

1,795

 

1,509

19.0%

20.6%

-1.6%

WW

 

1,947

 

1,698

14.7%

14.0%

0.7%

       

5,463

 

4,661

17.2%

17.7%

-0.5%

TREMFYA

                                 

US

 

222

 

221

0.4%

0.4%

-

       

650

 

565

15.0%

15.0%

-

Intl

 

105

 

69

54.4%

50.4%

4.0%

       

316

 

177

78.7%

79.1%

-0.4%

WW

 

327

 

290

13.1%

12.2%

0.9%

       

965

 

742

30.2%

30.3%

-0.1%

OTHER IMMUNOLOGY

                                 

US

 

-

 

-

-

-

-

       

-

 

-

-

-

-

Intl

 

3

 

2

35.6%

44.6%

-9.0%

       

9

 

8

12.4%

19.1%

-6.7%

WW

 

3

 

2

35.6%

44.6%

-9.0%

       

9

 

8

12.4%

19.1%

-6.7%

INFECTIOUS DISEASES

                                 

US

 

413

 

418

-1.1%

-1.1%

-

       

1,265

 

1,162

8.9%

8.9%

-

Intl

 

451

 

421

7.0%

6.3%

0.7%

       

1,397

 

1,385

0.9%

3.8%

-2.9%

WW

 

864

 

839

3.0%

2.6%

0.4%

       

2,662

 

2,547

4.5%

6.1%

-1.6%

EDURANT / rilpivirine

                                 

US

 

11

 

12

-12.0%

-12.0%

-

       

33

 

36

-8.6%

-8.6%

-

Intl

 

226

 

206

9.3%

5.0%

4.3%

       

684

 

603

13.3%

13.8%

-0.5%

WW

 

236

 

218

8.1%

4.1%

4.0%

       

716

 

639

12.1%

12.6%

-0.5%

PREZISTA / PREZCOBIX / REZOLSTA / SYMTUZA

                                 

US

 

379

 

373

1.5%

1.5%

-

       

1,154

 

1,032

11.8%

11.8%

-

Intl

 

147

 

135

9.1%

12.1%

-3.0%

       

461

 

534

-13.7%

-8.8%

-4.9%

WW

 

526

 

508

3.5%

4.3%

-0.8%

       

1,615

 

1,566

3.1%

4.8%

-1.7%

OTHER INFECTIOUS DISEASES

                                 

US

 

24

 

33

-26.6%

-26.6%

-

       

79

 

94

-16.6%

-16.6%

-

Intl

 

78

 

80

-2.3%

-0.4%

-1.9%

       

252

 

248

1.8%

6.3%

-4.5%

WW

 

102

 

113

-9.4%

-8.1%

-1.3%

       

331

 

342

-3.2%

0.0%

-3.2%

                                   
                                   
 

REPORTED SALES vs. PRIOR PERIOD ($MM)

     

REPORTED SALES vs. PRIOR PERIOD ($MM)

 

THIRD QUARTER

     

NINE MONTHS

   

% Change

       

% Change

   

2020

 

2019

Reported

Operational (1)

Currency

       

2020

 

2019

Reported

Operational (1)

Currency

NEUROSCIENCE

                                 

US

 

759

 

785

-3.5%

-3.5%

-

       

2,285

 

2,172

5.2%

5.2%

-

Intl

 

846

 

810

4.5%

4.1%

0.4%

       

2,565

 

2,590

-1.0%

0.9%

-1.9%

WW

 

1,605

 

1,595

0.6%

0.4%

0.2%

       

4,850

 

4,762

1.8%

2.9%

-1.1%

CONCERTA / Methylphenidate

                                 

US

 

43

 

84

-49.2%

-49.2%

-

       

150

 

196

-23.6%

-23.6%

-

Intl

 

107

 

109

-2.0%

-1.7%

-0.3%

       

319

 

348

-8.2%

-6.4%

-1.8%

WW

 

149

 

193

-22.6%

-22.5%

-0.1%

       

469

 

544

-13.8%

-12.6%

-1.2%

INVEGA SUSTENNA / XEPLION /
INVEGA TRINZA / TREVICTA

                                 

US

 

585

 

554

5.6%

5.6%

-

       

1,704

 

1,543

10.5%

10.5%

-

Intl

 

341

 

297

14.9%

12.6%

2.3%

       

983

 

916

7.3%

8.6%

-1.3%

WW

 

926

 

851

8.8%

8.0%

0.8%

       

2,688

 

2,459

9.3%

9.8%

-0.5%

RISPERDAL CONSTA

                                 

US

 

70

 

79

-11.0%

-11.0%

-

       

220

 

237

-6.9%

-6.9%

-

Intl

 

81

 

89

-7.8%

-8.9%

1.1%

       

254

 

292

-12.7%

-11.0%

-1.7%

WW

 

152

 

167

-9.3%

-9.9%

0.6%

       

475

 

528

-10.1%

-9.2%

-0.9%

OTHER NEUROSCIENCE

                                 

US

 

60

 

68

-11.3%

-11.3%

-

       

210

 

196

7.1%

7.1%

-

Intl

 

317

 

316

0.3%

1.7%

-1.4%

       

1,008

 

1,035

-2.6%

-0.1%

-2.5%

WW

 

377

 

384

-1.8%

-0.6%

-1.2%

       

1,218

 

1,231

-1.1%

1.1%

-2.2%

ONCOLOGY

                                 

US

 

1,267

 

1,171

8.2%

8.2%

-

       

3,623

 

3,146

15.2%

15.2%

-

Intl

 

1,862

 

1,590

17.1%

15.5%

1.6%

       

5,310

 

4,830

9.9%

11.8%

-1.9%

WW

 

3,129

 

2,761

13.3%

12.4%

0.9%

       

8,933

 

7,976

12.0%

13.1%

-1.1%

DARZALEX

                                 

US

 

585

 

402

46.0%

46.0%

-

       

1,540

 

1,123

37.2%

37.2%

-

Intl

 

514

 

363

41.5%

40.5%

1.0%

       

1,397

 

1,045

33.7%

36.7%

-3.0%

WW

 

1,099

 

765

43.8%

43.4%

0.4%

       

2,937

 

2,168

35.5%

37.0%

-1.5%

ERLEADA

                                 

US

 

152

 

74

*

*

-

       

407

 

194

*

*

-

Intl

 

55

 

12

*

*

*

       

112

 

22

*

*

*

WW

 

206

 

86

*

*

*

       

519

 

216

*

*

*

IMBRUVICA

                                 

US

 

450

 

447

0.7%

0.7%

-

       

1,329

 

1,163

14.2%

14.2%

-

Intl

 

581

 

475

22.5%

21.2%

1.3%

       

1,682

 

1,373

22.5%

25.2%

-2.7%

WW

 

1,031

 

921

11.9%

11.2%

0.7%

       

3,011

 

2,536

18.7%

20.2%

-1.5%

VELCADE

                                 

US

 

-

 

-

-

-

-

       

-

 

-

-

-

-

Intl

 

105

 

149

-30.1%

-30.8%

0.7%

       

311

 

636

-51.2%

-50.7%

-0.5%

WW

 

105