Johnson & Johnson reported lower than expected quarterly sales on Tuesday and cut its full-year 2012 profit forecast, citing negative foreign exchange factors, but quarterly earnings narrowly beat Wall Street estimates.
J&J said Tuesday it earned $1.41 billion, or 50 cents per share, in the second quarter. That compared with $2.78 billion, or $1 per share, in the year-earlier period, when the diversified healthcare company took a big charge for restructuring its Cordis heart-device unit.
Quarterly sales totalled $16.48 billion, falling short of Wall Street expectations of $16.69 billion.
Excluding a number of big charges, J&J earned $1.30 per share in the most recent period. Analysts, on average, expected $1.29 per share, according to Thomson Reuters.
Citing a weakening dollar in April, J&J raised its 2012 profit forecast to between $5.07 and $5.17 per share. But on Tuesday it switched gears, trimmed its forecast to $5.00 to $5.07 per share, citing a turnaround in the dollar’s direction.
“The dollar is now gaining strength against other currencies,” company spokesman Al Wasilewski said. A stronger dollar reduces the value of sales in overseas markets, and is especially punishing to companies like J&J that derive a big percentage of sales outside the U.S.
J&J took charges of $2.2 billion in the most recent quarter related to the writedown of research assets of its Crucell vaccines business, increased litigation costs related to probes of how it marketed its Risperdal schizophrenia drug and costs of its recent acquisition of Swiss medical device maker Synthes.
In the year-earlier period, the company took a big charge for restructuring its Cordis heart-device unit.
J&J shares fell from their closing price of $68.45 Monday on the New York Stock Exchange.