Johnson & Johnson
JOHNSON & JOHNSON (Form: 8-K, Received: 04/17/2018 08:03:48)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549


FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of The
Securities Exchange Act of 1934
 
Date of report (Date of earliest event reported):
 
April 17, 2018
JNJLOGOA06A02A01A01A01A18.JPG
 
(Exact name of registrant as specified in its charter)
 
 
New Jersey
I-3215
22-1024240
(State or Other Jurisdiction of Incorporation)
(Commission File Number)
(IRS Employer Identification No.)


One Johnson & Johnson Plaza, New Brunswick, New Jersey  08933
 
(Address of Principal Executive Offices)
 (Zip Code)
 
Registrant's telephone number, including area code:
732-524-0400
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
o             Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
o             Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
o             Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17
               CFR 240.14d-2(b))
 
o             Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17
               CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ¨  

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ¨




 
 


 
Item 2.02             Results of Operations and Financial Condition
 
On  April 17, 2018 , Johnson & Johnson issued the attached press release announcing its sales and earnings for the first quarter ended April 1, 2018 .

Item 2.05    Costs Associated with Exit or Disposal Activities

On April 11, 2018, Johnson & Johnson approved plans to implement a series of actions across its Global Supply Chain that are intended to focus resources and increase investments in the critical capabilities, technologies and solutions necessary to manufacture and supply its product portfolio, enhance agility and drive growth.   The Company expects the Global Supply Chain actions will include expanding the use of strategic collaborations and bolstering initiatives to reduce complexity, improve cost-competitiveness, enhance capabilities and optimize the Supply Chain network.  Discussions regarding specific future actions are ongoing and are subject to all relevant consultation requirements before they are finalized. 

In total, the Company expects these actions to generate approximately $0.6 billion to $0.8 billion in annual pre-tax cost savings that will be substantially delivered by 2022. The Company expects to record pre-tax restructuring charges of approximately $1.9 billion to $2.3 billion, over the 4 to 5 year period of this activity, which will be treated as a special item, and adjusted from GAAP earnings. The Company estimates that approximately 70% of the cumulative pre-tax costs will result in cash outlays.  The costs are associated with network optimizations, exit costs and accelerated depreciation and amortization.



Item 9.01            Financial Statements and Exhibits

(d)     Exhibits. 
 
Exhibit No.
 
Description of Exhibit
 
 
Press Release dated April 17, 2018 for the period ended April 1, 2018.
 
 
Unaudited Comparative Supplementary Sales Data and Condensed Consolidated Statement of Earnings for the first quarter.
 
 




 
 
 


 

SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
Johnson & Johnson
 
 
 
 (Registrant)
 
 
 
 
Date: April 17, 2018
By:
/s/ Ronald A. Kapusta
 
 
 
Ronald A. Kapusta
Controller
(Principal Accounting Officer)
 





Exhibit 99.15

Johnson & Johnson Reports 2018 First-Quarter Results:

2018 First-Quarter Sales of $20.0 Billion Increased 12.6% versus 2017
2018 First-Quarter EPS was $1.60
2018 Adjusted First-Quarter EPS of $2.06 increased 12.6%*

Sales Momentum Continued in the First Quarter
Strong Adjusted EPS Growth of 12.6%*
Company Increased Sales and Reaffirms EPS Guidance

New Brunswick, N.J. (April 17, 2018) - Johnson & Johnson (NYSE: JNJ) today announced sales of $20.0 billion for the first quarter of 2018, an increase of 12.6% as compared to the first quarter of 2017. Operational sales results increased 8.4% and the positive impact of currency was 4.2%. Domestic sales increased 6.1%. International sales increased 19.9%, reflecting operational growth of 10.9% and a positive currency impact of 9.0%. Excluding the net impact of acquisitions and divestitures, on an operational basis, worldwide sales increased 4.3%, domestic sales increased 1.3% and international sales increased 7.6%. *
Net earnings and diluted earnings per share for the first quarter of 2018 were $4.4 billion and $1.60, respectively. First-quarter 2018 net earnings included after-tax intangible amortization expense of approximately $1.0 billion and a charge for after-tax special items of approximately $0.3 billion. First-quarter 2017 net earnings included after-tax intangible amortization expense of approximately $0.2 billion and a charge for after-tax special items of approximately $0.4 billion. Excluding after-tax intangible amortization expense and special items, adjusted net earnings for the current quarter were $5.6 billion and adjusted diluted earnings per share were $2.06, representing increases of 11.8% and 12.6%, respectively, as compared to the same period in 2017. * On an operational basis, adjusted diluted earnings per share also increased 5.5%. * A reconciliation of non-GAAP financial measures is included as an accompanying schedule.
“We are pleased with the strong and consistent performance delivered by our colleagues around the world, demonstrated by our sales and EPS growth in the first quarter.” said Alex Gorsky, Chairman and Chief Executive Officer. “Our Pharmaceutical business continues to deliver robust growth and we are pleased with the improvement in our Consumer business. In our Medical Devices businesses, we have areas of leadership and continue to make investments and portfolio choices to improve performance.”
Mr. Gorsky continued, “The U.S. tax legislation passed late last year is creating the opportunity for us to invest more than $30 billion in R&D and capital investments in the U.S. over the next four years, which is an increase of 15%.”
The Company increased its sales guidance for the full-year 2018 to a range of $81.0 to $81.8 billion, reflecting expected operational growth in the range of 4.0% to 5.0%. Additionally, the Company reaffirmed its adjusted earnings guidance for full-year 2018 to a range of $8.00 to $8.20 per share, reflecting expected operational growth in the range of 6.8% to 9.6%.







Segment Sales Performance
Worldwide Consumer sales of $3.4 billion for the first quarter 2018 represented an increase of 5.3% versus the prior year, consisting of an operational increase of 1.3% and a positive impact from currency of 4.0%. Domestic sales increased 1.6%, international sales increased 8.2%, which reflected an operational increase of 1.2% and a positive currency impact of 7.0%. Excluding the net impact of acquisitions and divestitures, on an operational basis, worldwide sales increased 2.0%, domestic sales increased 1.6% and international sales increased 2.3% * .
Worldwide operational results, excluding the net impact of acquisitions and divestitures, were driven by beauty products primarily NEUTROGENA, AVEENO, and Dr. Ci Labo, and international analgesics in over-the-counter products, partially offset by the negative impact of domestic baby care products.
Worldwide Pharmaceutical sales of $9.8 billion for the first quarter 2018 represented an increase of 19.4% versus the prior year with an operational increase of 15.1% and a positive impact from currency of 4.3%. Domestic sales increased 9.9%; international sales increased 33.1%, which reflected an operational increase of 22.5% and a positive currency impact of 10.6%. Sales included the impact of Actelion Ltd which contributed 7.6%, to worldwide operational sales growth. Excluding the net impact of acquisitions and divestitures, on an operational basis, worldwide sales increased 7.5%, domestic sales increased 2.2% and international sales increased 15.3%. *
Worldwide operational results, excluding the net impact of acquisitions and divestitures, were driven by new products and the strength of core products. Strong growth in new products include DARZALEX (daratumumab), for the treatment of patients with multiple myeloma, IMBRUVICA (ibrutinib), an oral, once-daily therapy approved for use in treating certain B-cell malignancies, a type of blood or lymph node cancer and TREMFYA (guselkumab), for the treatment of adults living with moderate to severe plaque psoriasis. Additional contributors to operational sales growth included ZYTIGA (abiraterone acetate), an oral, once-daily medication for use in combination with prednisone for the treatment of metastatic, castration-resistant prostate cancer, STELARA (ustekinumab) and international SIMPONI/SIMPONI ARIA (golimumab), biologics for the treatment of a number of immune-mediated inflammatory diseases, XARELTO (rivaroxaban), an oral anticoagulant, and INVEGA SUSTENNA/XEPLION/TRINZA/TREVICTA (paliperidone palmitate), long-acting, injectable atypical antipsychotics for the treatment of schizophrenia in adults.
During the quarter, the U.S. Food and Drug Administration (FDA) approved an additional indication for ZYTIGA (abiraterone acetate), in combination with prednisone for the treatment of patients with metastatic high-risk castration-sensitive prostate cancer and ERLEADA (apalutamide) an oral androgen receptor inhibitor for the treatment of patients with non-metastatic castration-resistant prostate cancer. In addition, the Committee for Medicinal Products for Human Use issued a positive opinion recommending marketing authorization for JULUCA (rilpivirine and dolutegravir), the first, single-pill, two-drug regimen for the treatment of human immunodeficiency virus type 1 infection.
Also in the quarter, a marketing authorization application was submitted to the European Medicines Agency for apalutamide, an oral androgen receptor inhibitor for the treatment of patients with high-risk non-metastatic castration-resistant prostate cancer.





Worldwide Medical Devices sales of $6.8 billion for the first quarter 2018 represented an increase of 7.5% versus the prior year consisting of an operational increase of 3.2% and a positive currency impact of 4.3%. Domestic sales increased 2.2%; international sales increased 12.7%, which reflected an operational increase of 4.2% and a positive currency impact of 8.5%. Sales included the partial quarter impact of the recently acquired surgical vision business which contributed 3.1%, to worldwide operational sales growth. Excluding the net impact of acquisitions and divestitures, on an operational basis, worldwide sales increased 1.1%, domestic sales decreased 0.2% and international sales increased 2.4%. *
Worldwide operational results, excluding the net impact of acquisitions and divestitures, were driven by ACUVUE contact lenses in the Vision Care business; electrophysiology products in the Interventional Solutions business; endocutters in the Advanced Surgery business; and trauma products in the Orthopaedics business, partially offset by declines in the Diabetes Care business and spine products in the Orthopaedics business.
During the quarter, the acquisition of Orthotaxy S.A.S., a privately-held developer of software-enabled surgery technologies, including a differentiated robotic-assisted surgery was completed. In addition, the Company announced a binding offer from Platinum Equity, a private investment firm, to acquire its LifeScan business for approximately $2.1 billion, subject to customary adjustments.
Subsequent to the quarter, ACUVUE OASYS with Transitions received 510(k) clearance from the FDA and is indicated for vision correction and the attenuation of bright light.
Additionally, Johnson & Johnson plans to implement actions across its global supply chain that are intended to enable the company to focus resources and increase investments in critical capabilities, technologies and solutions necessary to manufacture and supply its product portfolio of the future, enhance agility and drive growth. The Company expects these supply chain actions will include expanding our use of strategic collaborations, and bolstering our initiatives to reduce complexity, improving cost-competitiveness, enhancing capabilities and optimizing our network.  Discussions regarding specific future actions are ongoing and are subject to all relevant consultation requirements before they are finalized.
In total, the Company expects these actions to generate approximately $0.6 to $0.8 billion in annual pre-tax cost savings that will be substantially delivered by 2022. The Company expects to record pre-tax restructuring charges of approximately $1.9 to $2.3 billion, which will be treated as a special item.

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.
* Operational sales growth excluding the net impact of acquisitions and divestitures, as well as adjusted net earnings, adjusted diluted earnings per share and operational adjusted 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 Investor Relations section of the company’s website at www.investor.jnj.com . 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.
          
     Johnson & Johnson will conduct a conference call with investors to discuss this news 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 at www.investor.jnj.com . A replay and podcast will be available approximately two hours after the live webcast by visiting www.investor.jnj.com .
Copies of the financial schedules accompanying this press release are available at www.investor.jnj.com/historical-sales.cfm . 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 be found on the company's website at www.investor.jnj.com .

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: 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, including restructuring 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 31, 2017, including in the sections captioned “Cautionary Note Regarding Forward-Looking Statements” and “Item 1A. Risk Factors,” and in the company’s subsequent Quarterly Reports on Form 10-Q and other 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.




Exhibit 99.2O


Johnson & Johnson and Subsidiaries
 
 
 
 
 
 
 
 
 

Condensed Consolidated Statement of Earnings
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 
 
(Unaudited; in Millions Except Per Share Figures)
FIRST QUARTER
 
 
 
 
 
 
 
 
 
 
 
2018
 
2017*
 
Percent

 
 
 
Percent
 
 
 
Percent
 
Increase

 
Amount
 
to Sales
 
Amount
 
to Sales
 
(Decrease)

Sales to customers
 $ 20,009

 
     100.0

 
 $ 17,766

 
     100.0

 
12.6

Cost of products sold
      6,614

 
       33.1

 
      5,409

 
       30.4

 
22.3

Selling, marketing and administrative expenses
      5,263

 
       26.3

 
      4,763

 
       26.8

 
10.5

Research and development expense
      2,404

 
       12.0

 
      2,070

 
       11.7

 
16.1

Interest (income) expense, net
         145

 
         0.7

 
           83

 
         0.5

 
 
Other (income) expense, net
           60

 
         0.3

 
(219
)
 
(1.3
)
 
 
Restructuring
           42

 
         0.2

 
           85

 
         0.5

 
 
Earnings before provision for taxes on income
      5,481

 
       27.4

 
      5,575

 
       31.4

 
(1.7
)
Provision for taxes on income
1,114

 
5.6

 
      1,153

 
         6.5

 
(3.4
)
Net earnings
4,367

 
21.8

 
      4,422

 
       24.9

 
(1.2
)
 
 
 
 
 
 
 
 
 
 
Net earnings per share (Diluted)
1.60

 
 
 
 $ 1.61

 
 
 
(0.6
)
 
 
 
 
 
 
 
 
 
 
Average shares outstanding (Diluted)
2,731.9

 
 
 
2,754.5

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Effective tax rate
20.3

%
 
 
20.7

%
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted earnings before provision for taxes and net earnings  (1) (A)
 
 
 
 
 
 
 
 
 
Earnings before provision for taxes on income
 $ 6,858

 
34.3

 
 $ 6,103

 
34.4

 
12.4

Net earnings
 $ 5,635

 
28.2

 
 $ 5,038

 
28.4

 
11.8

Net earnings per share (Diluted)
 $ 2.06

 
 
 
 $ 1.83

 
 
 
12.6

Effective tax rate
17.8

%
 
 
17.5

%
 
 
 
 
 
 
 
 
 
 
 
 
 
(1)  See Reconciliation of Non-GAAP Financial Measures.
 
 
 
 
 
 
 
 
 
(A)  NON-GAAP FINANCIAL MEASURES "Adjusted earnings before provision for taxes on income," "adjusted net earnings," "adjusted net earnings per share (diluted)," and "adjusted effective tax rate" are non-GAAP financial measures and should not be considered replacements for GAAP results. The Company provides earnings before provision for taxes on income, net earnings, net earnings per share (diluted), and effective tax rate on an adjusted basis because management believes that these measures provide useful information to investors. Among other things, these measures may assist investors in evaluating the Company's results of operations period over period. In various periods, these measures may exclude such items as intangible asset amortization expense, significant costs associated with acquisitions, restructuring, litigation, and changes in applicable laws and regulations (including significant accounting or tax matters). Special items may be highly variable, difficult to predict, and of a size that sometimes has substantial impact on the Company's reported results of operations for a period. Management uses these measures internally for planning, forecasting and evaluating the performances of the Company's businesses, including allocating resources and evaluating results relative to employee performance compensation targets. Unlike earnings before provision for taxes on income, net earnings, net earnings per share (diluted), and effective tax rate prepared in accordance with GAAP, adjusted earnings before provision for taxes on income, adjusted net earnings, adjusted net earnings per share (diluted), and adjusted effective tax rate may not be comparable with the calculation of similar measures for other companies. The limitations of using these non-GAAP financial measures as performance measures are that they provide a view of the Company's results of operations without including all events during a period, such as intangible asset amortization expense, the effects of an acquisition, restructuring, litigation, and changes in applicable laws and regulations (including significant accounting or tax matters) and do not provide a comparable view of the Company's performance to other companies in the health care industry. Investors should consider non-GAAP financial measures in addition to, and not as replacements for, or superior to, measures of financial performance prepared in accordance with GAAP.
 
 
 
 
 
 
 
 
 
 
*2017 Statement of Earnings line items have been restated to reflect impact of ASU 2017-07
 








Johnson & Johnson and Subsidiaries
 
 
 
 
 
 
 
 
 
Supplementary Sales Data
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Unaudited; Dollars in Millions)
FIRST QUARTER
 
 
 
 
 
Percent Change
 
2018
 
2017
 
Total
 
Operations
 
Currency
Sales to customers by
 
 
 
 
 
 
 
 
 
segment of business
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consumer
 
 
 
 
 
 
 
 
 
    U.S.
 $ 1,436
 
          1,414
 
              1.6
%
              1.6
 
    International
          1,962
 
          1,814
 
              8.2
 
              1.2
 
              7.0
 
          3,398
   
          3,228
 
              5.3
 
              1.3
 
              4.0
 
 
 
 
 
 
 
 
 
 
Pharmaceutical
 
 
 
 
 
 
 
 
 
    U.S.
          5,354
 
          4,872
 
              9.9
 
              9.9
 
    International
          4,490
 
          3,373
 
            33.1
 
            22.5
 
            10.6
 
          9,844
   
          8,245
 
            19.4
 
            15.1
 
              4.3
 
 
 
 
 
 
 
 
 
 
Medical Devices
 
 
 
 
 
 
 
 
 
    U.S.
          3,161
   
          3,092
 
              2.2
 
              2.2
 
    International
          3,606
 
          3,201
 
            12.7
 
              4.2
 
              8.5
 
          6,767
   
          6,293
 
7.5
 
              3.2
 
              4.3
 
 
 
 
 
 
 
 
 
 
U.S.
          9,951
 
          9,378
 
              6.1
 
              6.1
 
International
        10,058
 
          8,388
 
            19.9
 
            10.9
 
              9.0
Worldwide
 $ 20,009
 
        17,766
 
            12.6
%
              8.4
 
              4.2




































Johnson & Johnson and Subsidiaries
 
 
 
 
 
 
 
 
 
Supplementary Sales Data
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Unaudited; Dollars in Millions)
FIRST QUARTER
 
 
 
 
 
Percent Change
 
2018
 
2017
 
Total
 
Operations
 
Currency
Sales to customers by
 
 
 
 
 
 
 
 
 
geographic area
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S.
 $ 9,951
 
               9,378
 
              6.1
%
            6.1
 
 
 
 
 
 
 
 
 
 
 
Europe
          4,797
 
               3,858
 
24.3
 
          10.0
 
            14.3
Western Hemisphere excluding U.S.
          1,567
 
               1,454
 
              7.8
 
            7.2
 
              0.6
Asia-Pacific, Africa
          3,694
 
               3,076
 
            20.1
 
          13.7
 
              6.4
International
        10,058
 
               8,388
 
            19.9
 
          10.9
 
              9.0
 
  
 
  
 
  
 
  
 
  
Worldwide
 $ 20,009
 
             17,766
 
            12.6
%
            8.4
 
              4.2




















Johnson & Johnson and Subsidiaries
 
 
 
 
 
 
Reconciliation of Non-GAAP Financial Measures
 
 
 
 
 
 
 
 
 
 
 
 
 
 
First Quarter
 
% Incr. /
 
(Dollars in Millions Except Per Share Data)
2018
 
2017
 
(Decr.)
 
 
 
 
 
 
 
 
Earnings before provision for taxes on income - as reported
$
5,481

 
  5,575

 
(1.7
)
%
 
 
 
 
 
 
 
Intangible asset amortization expense
    1,115

 
     329

 
 
 
 
 
 
 
 
 
 
Restructuring/Other (1)
       107

 
     161

 
 
 
 
 
 
 
 
 
 
Actelion acquisition related cost
         96

 

 
 
 
 
 
 
 
 
 
 
Unrealized loss/(gain) on securities
         27

 

 
 
 
 
 
 
 
 
 
 
AMO acquisition related cost
         21

 
       38

 
 
 
 
 
 
 
 
 
 
Other
         11

 

 
 
 
 
 
 
 
 
 
 
Earnings before provision for taxes on income - as adjusted
$
6,858

 
  6,103

 
           12.4

%
 
 
 
 
 
 
 
Net Earnings - as reported
$
4,367

 
  4,422

 
(1.2
)
%
 
 
 
 
 
 
 
Intangible asset amortization expense
       996

 
     244

 
 
 
 
 
 
 
 
 
 
Restructuring/Other
         81

 
     121

 
 
 
 
 
 
 
 
 
 
Actelion acquisition related cost
         92

 

 
 
 
 
 
 
 
 
 
 
Unrealized loss/(gain) on securities
         21

 

 
 
 
 
 
 
 
 
 
 
AMO acquisition related cost
         17

 
     251

 
 
 
 
 
 
 
 
 
 
Impact of tax legislation (2)
52

 

 
 
 
 
 
 
 
 
 
 
Other
           9

 

 
 
 
 
 
 
 
 
 
 
Net Earnings - as adjusted
$
5,635

 
  5,038

 
           11.8

%
 
 
 
 
 
 
 
Diluted Net Earnings per share - as reported
$
1.60

 
    1.61

 
(0.6
)
%
 
 
 
 
 
 
 
Intangible asset amortization expense
      0.36

 
    0.09

 
 
 
 
 
 
 
 
 
 
Restructuring/Other
      0.03

 
    0.04

 
 
 
 
 
 
 
 
 
 
Actelion acquisition related cost
      0.03

 

 
 
 
 
 
 
 
 
 
 
Unrealized loss/(gain) on securities
      0.01

 

 
 
 
 
 
 
 
 
 
 
AMO acquisition related cost
      0.01

 
    0.09

 
 
 
 
 
 
 
 
 
 
Impact of tax legislation
0.02

 

 
 
 
 
 
 
 
 
 
 
Other

 

 
 
 
 
 
 
 
 
 
 
Diluted Net Earnings per share - as adjusted
$
2.06

 
    1.83

 
           12.6

%
 
 
 
 
 
 
 
Operational Diluted Net Earnings per share - as adjusted at 2016 foreign currency exchange rates
 
   
1.86

 
 
 
 
 
 
 
 
 
 
Impact of currency at 2017 foreign currency exchange rates
(0.13
)
   
  (0.03)

 
 
 
 
 
 
 
 
 
 
Operational Diluted Net Earnings per share - as adjusted at 2017 foreign currency exchange rates
$
1.93

 
1.83

 
5.5

%
 
 
 
 
 
 
 
(1)  Includes $6M recorded in cost of products sold and $59M recorded in other (income) expense in the first quarter 2018, and
      $4M recorded in cost of products sold and $72M recorded in other (income) expense in the first quarter 2017
 
(2)  Includes foreign currency translation











Johnson & Johnson and Subsidiaries
 
 
 
 
 
 
 
 
Reconciliation of Non-GAAP Financial Measure
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operational Sales Growth Excluding Acquisitions and Divestitures (A)
 FIRST QUARTER 2018 ACTUAL vs. 2017 ACTUAL
 
 Segments
 
 
Consumer
 
 Pharmaceutical
 
 Medical Devices
 
 Total
 
 
Operational %  (1)
 WW As Reported:
 
1.3%
 
15.1%
 
3.2%
 
8.4%
 U.S.
 
1.6%
 
9.9%
 
2.2%
 
6.1%
 International
 
1.2%
 
22.5%
 
4.2%
 
10.9%
 
 
 
 
 
 
 
 
 
Vision Care
 
 
 
 
 
 
 
 
Vision Surgical & Eye Health Business  (2)
 
 
 
 
 
(3.1)
 
(1.1)
 U.S.
 
 
 
 
 
(2.8)
 
(0.9)
 International
 
 
 
 
 
(3.4)
 
(1.3)
 
 
 
 
 
 
 
 
 
Pulmonary Hypertension
 
 
 
 
 
 
 
 
Actelion
 
 
 
(7.1)
 
 
 
(3.3)
 U.S.
 
 
 
(7.4)
 
 
 
(3.8)
 International
 
 
 
(6.6)
 
 
 
(2.7)
 
 
 
 
 
 
 
 
 
Cardiovascular / Metabolism / Other
 
 
 
 
 
 
 
 
Actelion
 
 
 
(0.5)
 
 
 
(0.2)
 U.S.
 
 
 
(0.3)
 
 
 
(0.2)
 International
 
 
 
(0.6)
 
 
 
(0.3)
 
 
 
 
 
 
 
 
 
Spine & Other
 
 
 
 
 
 
 
 
Codman Neuroscience
 
 
 
 
 
1.0
 
0.4
 U.S.
 
 
 
 
 
0.7
 
0.2
 International
 
 
 
 
 
1.4
 
0.6
 
 
 
 
 
 
 
 
 
Wound Care / Other
 
 
 
 
 
 
 
 
Compeed
 
0.7
 
 
 
 
 
0.1
 U.S.
 
0.0
 
 
 
 
 
0.0
 International
 
1.2
 
 
 
 
 
0.3
 
 
 
 
 
 
 
 
 
All Other Acquisitions and Divestitures
 
0.0
 
 
 
0.0
 
0.0
 U.S.
 
0.0
 
 
 
(0.3)
 
(0.1)
 International
 
(0.1)
 
 
 
0.2
 
0.1
 
 
 
 
 
 
 
 
 
WW Ops excluding Acquisitions and Divestitures
 
2.0%
 
7.5%
 
1.1%
 
4.3%
 U.S.
 
1.6%
 
2.2%
 
(0.2)%
 
1.3%
 International
 
2.3%
 
15.3%
 
2.4%
 
7.6%
 
 
 
 
 
 
 
 
 
(1)  Operational growth excludes the effect of translational currency
 
 
 
 
(2) Previously referred to as Medical Optics
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(A)  NON-GAAP FINANCIAL MEASURE “Operational sales growth excluding the net impact of acquisitions and divestitures" is a non-GAAP financial measure. Investors should consider non-GAAP financial measures in addition to, and not as replacements for, or superior to, measures of financial performance prepared in accordance with GAAP. Due to the variable nature of acquisitions and divestitures, and the impact they may have on the analysis of underlying business performance and trends, management believes that providing this measure enhances an investor’s understanding of the Company’s performance and may assist in the evaluation of ongoing business operations period over period. This non-GAAP financial measure is presented to permit investors to more fully understand how management assesses the performance of the Company, including for internal evaluation of the performance of the Company's businesses and planning and forecasting for future periods. The use of this non-GAAP financial measure as a performance measure is limited in that it provides a view of the Company's results of operations without including all events during a period and may not provide a comparable view of the Company's performance to that of other companies in the health care industry.






Johnson & Johnson
Segment Sales
(Dollars in Millions)
 
 
 
FIRST QUARTER
 
 
 
 
 
 
 
% Change
 
 
 
2018
 
2017
 
Reported
Operational  (1)
Currency

CONSUMER SEGMENT  (2)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
BABY CARE
 
 
 
 
 
 
 
 
 
US
 
$
97

 
113

 
(14.2
)%
(14.2
)%
%
Intl
 
 
360

 
342

 
5.3

1.3

4.0

WW
 
 
457

 
455

 
0.4

(2.6
)
3.0

 
 
 
 
 
 
 
 
 
 
BEAUTY
 
 
 
 
 
 
 
 
 
US
 
 
611

 
567

 
7.8

7.8


Intl
 
 
473

 
414

 
14.3

6.2

8.1

WW
 
 
1,084

 
981

 
10.5

7.1

3.4

 
 
 
 
 
 
 
 
 
 
ORAL CARE
 
 
 
 
 
 
 
 
 
US
 
 
157

 
156

 
0.6

0.6


Intl
 
 
222

 
206

 
7.8

0.7

7.1

WW
 
 
379

 
362

 
4.7

0.6

4.1

 
 
 
 
 
 
 
 
 
 
OTC
 
 
 
 
 
 
 
 
 
US
 
 
465

 
477

 
(2.5
)
(2.5
)

Intl
 
 
607

 
536

 
13.2

3.9

9.3

WW
 
 
1,072

 
1,013

 
5.8

0.9

4.9

 
 
 
 
 
 
 
 
 
 
WOMEN'S HEALTH
 
 
 
 
 
 
 
 
 
US
 
 
3

 
3

 
0.0

0.0


Intl
 
 
240

 
239

 
0.4

(4.6
)
5.0

WW
 
 
243

 
242

 
0.4

(4.6
)
5.0

 
 
 
 
 
 
 
 
 
 
WOUND CARE/OTHER
 
 
 
 
 
 
 
 
 
US
 
 
103

 
98

 
5.1

5.1


Intl
 
 
60

 
77

 
(22.1
)
(26.7
)
4.6

WW
 
 
163

 
175

 
(6.9
)
(8.9
)
2.0

 
 
 
 
 
 
 
 
 
 
TOTAL CONSUMER
 
 
 
 
 
 
 
 
 
US
 
 
1,436

 
1,414

 
1.6

1.6


Intl
 
 
1,962

 
1,814

 
8.2

1.2

7.0

WW
 
$
3,398

 
3,228

 
5.3
 %
1.3
 %
4.0
%
 
 
 
 
 
 
 
 
 
 
See footnotes at end of schedule
 
 
 
 
 
 
 
 
 






Johnson & Johnson
Segment Sales
(Dollars in Millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
FIRST QUARTER
 
 
 
 
 
 
 
% Change
 
 
 
2018
 
2017
 
Reported
Operational  (1)
Currency

PHARMACEUTICAL SEGMENT   (2)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
IMMUNOLOGY
 
 
 
 
 
 
 
 
 
US
 
$
2,000

 
2,123

 
(5.8
)%
(5.8
)%
%
Intl
 
 
1,042

 
807

 
29.1

19.4

9.7

WW
 
 
3,042

 
2,930

 
3.8

1.1

2.7

       REMICADE
 
 
 
 
 
 
 
 
 
     US
 
 
916

 
1,182
 
(22.5
)
(22.5
)

     US Exports  (3)
 
 
142

 
165

 
(13.9
)
(13.9
)

     Intl
 
 
331

 
325

 
1.8

(3.7
)
5.5

     WW
 
 
1,389

 
1,672

 
(16.9
)
(18.0
)
1.1

      SIMPONI / SIMPONI ARIA
 
 
 
 
 
 
 
 
 
     US
 
 
224

 
229

 
(2.2
)
(2.2
)

     Intl
 
 
294

 
199

 
47.7

37.3

10.4

     WW
 
 
518

 
428

 
21.0

16.2

4.8

      STELARA
 
 
 
 
 
 
 
 
 
     US
 
 
652

 
547

 
19.2

19.2


     Intl
 
 
409

 
276

 
48.2

34.0

14.2

     WW
 
 
1,061

 
823

 
28.9

24.1

4.8

      OTHER IMMUNOLOGY
 
 
 
 
 
 
 
 
 
     US
 
 
66

 

 
 *

 *


     Intl
 
 
8

 
7

 
14.3

13.3

1.0

     WW
 
 
74

 
7

 
*

*

*

 
 
 
 
 
 
 
 
 
 
INFECTIOUS DISEASES
 
 
 
 
 
 
 
 
 
US
 
 
333

 
326

 
2.1

2.1


Intl
 
 
497

 
423

 
17.5

5.9

11.6

WW
 
 
830

 
749

 
10.8

4.2

6.6

      EDURANT / rilpivirine
 
 
 
 
 
 
 
 
 
     US
 
 
14

 
12

 
16.7

16.7


     Intl
 
 
196

 
137

 
43.1

25.2

17.9

     WW
 
 
210

 
149

 
40.9

24.5

16.4

      PREZISTA / PREZCOBIX / REZOLSTA / SYMTUZA
 
 
 
 
 
 
     US
 
 
273

 
259

 
5.4

5.4


     Intl
 
 
205

 
171

 
19.9

9.4

10.5

     WW
 
 
478

 
430

 
11.2

7.0

4.2

      OTHER INFECTIOUS DISEASES
 
 
 
 
 
 
 
 
 
     US
 
 
46

 
55

 
(16.4
)
(16.4
)

     Intl
 
 
96

 
115

 
(16.5
)
(22.4
)
5.9

     WW
 
 
142

 
170

 
(16.5
)
(20.5
)
4.0

 
 
 
 
 
 
 
 
 
 
See footnotes at end of schedule
 
 
 
 
 
 
 
 
 





Johnson & Johnson
Segment Sales
(Dollars in Millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
FIRST QUARTER
 
 
 
 
 
 
 
% Change
 
 
 
2018
 
2017
 
Reported
Operational (1)
Currency

PHARMACEUTICAL SEGMENT   (2) (Continued)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NEUROSCIENCE
 
 
 
 
 
 
 
 
 
US
 
$
624

 
664

 
(6.0
)%
(6.0
)%
%
Intl
 
 
935

 
833

 
12.2

3.3

8.9

WW
 
 
1,559

 
1,497

 
4.1

(0.8
)
4.9

      CONCERTA / methylphenidate
 
 
 
 
 
 
 
 
 
     US
 
 
66

 
108

 
(38.9
)
(38.9
)

     Intl
 
 
107

 
101

 
5.9

(0.9
)
6.8

     WW
 
 
173

 
209

 
(17.2
)
(20.5
)
3.3

      INVEGA SUSTENNA / XEPLION / TRINZA / TREVICTA
 
 
 
 
 
 
 
     US
 
 
400

 
372

 
7.5

7.5


     Intl
 
 
296

 
232

 
27.6

15.2

12.4

     WW
 
 
696

 
604

 
15.2

10.5

4.7

       RISPERDAL CONSTA
 
 
 
 
 
 
 
 
 
     US
 
 
82

 
95

 
(13.7
)
(13.7
)

     Intl
 
 
114

 
112

 
1.8

(7.1
)
8.9

     WW
 
 
196

 
207

 
(5.3
)
(10.2
)
4.9

      OTHER NEUROSCIENCE
 
 
 
 
 
 
 
 
 
     US
 
 
76

 
89

 
(14.6
)
(14.6
)

     Intl
 
 
418

 
388

 
7.7

0.4

7.3

     WW
 
 
494

 
477

 
3.6

(2.3
)
5.9

 
 
 
 
 
 
 
 
 
 
ONCOLOGY
 
 
 
 
 
 
 
 
 
US
 
 
933

 
664

 
40.5

40.5


Intl
 
 
1,378

 
930

 
48.2

34.5

13.7

WW
 
 
2,311

 
1,594

 
45.0

37.0

8.0

      DARZALEX
 
 
 
 
 
 
 
 
 
     US
 
 
264

 
201

 
31.3

31.3


     Intl
 
 
168

 
54

 
*

*

*

     WW
 
 
432

 
255

 
69.4

63.5

5.9

      IMBRUVICA
 
 
 
 
 
 
 
 
 
     US
 
 
227

 
190

 
19.5

19.5


     Intl
 
 
360

 
219

 
64.4

49.0

15.4

     WW
 
 
587

 
409

 
43.5

35.3

8.2

      VELCADE
 
 
 
 
 
 
 
 
 
     US
 
 

 

 



     Intl
 
 
313

 
280

 
11.8

1.6

10.2

     WW
 
 
313

 
280

 
11.8

1.6

10.2

      ZYTIGA
 
 
 
 
 
 
 
 
 
     US
 
 
407

 
233

 
74.7

74.7


     Intl
 
 
438

 
290

 
51.0

36.8

14.2

     WW
 
 
845

 
523

 
61.6

53.7

7.9

      OTHER ONCOLOGY
 
 
 
 
 
 
 
 
 
     US
 
 
35

 
40

 
(12.5
)
(12.5
)

     Intl
 
 
99

 
87

 
13.8

4.0

9.8

     WW
 
 
134

 
127

 
5.5

(1.2
)
6.7

See footnotes at end of schedule
 
 
 
 
 
 
 
 
 




Johnson & Johnson
Segment Sales
(Dollars in Millions)
 
 
 
FIRST QUARTER
 
 
 
 
 
 
 
% Change
 
 
 
2018
 
2017
 
Reported
Operational (1)
Currency
PHARMACEUTICAL SEGMENT   (2) (Continued)
 
 
 
 
 
 
 
 
 
 
 
 
PULMONARY HYPERTENSION (4)
 
 
 
 
 
 
US
 
$
361

 

 
*
*
Intl
 
 
224

 

 
*
*
WW
 
 
585

 

 
*
*
      OPSUMIT
 
 
 
 
 
 
 
 
 
     US
 
 
149

 

 
*
*
     Intl
 
 
122

 

 
*
*
     WW
 
 
271

 

 
*
*
      TRACLEER
 
 
 
 
 
 
 
 
 
     US
 
 
68

 

 
*
*
     Intl
 
 
72

 

 
*
*
     WW
 
 
140

 

 
*
*
       UPTRAVI
 
 
 
 
 
 
 
 
 
     US
 
 
124

 

 
*
*
     Intl
 
 
16

 

 
*
*
     WW
 
 
140

 

 
*
*
      OTHER
 
 
 
 
 
 
 
     US
 
 
20

 

 
*
*
     Intl
 
 
14

 

 
*
*
     WW
 
 
34

 

 
*
*
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
See footnotes at end of schedule
 
 
 
 
 
 
 




Johnson & Johnson
Segment Sales
(Dollars in Millions)
 
 
 
FIRST QUARTER
 
 
 
 
 
 
 
% Change
 
 
 
2018
 
2017
 
Reported
Operational (1)
Currency
PHARMACEUTICAL SEGMENT   (2) (Continued)
 
 
 
 
 
 
 
 
 
 
 
 
CARDIOVASCULAR / METABOLISM / OTHER
 
 
 
 
 
 
US
 
$
1,103

 
1,095

 
0.7
 %
0.7
 %
%
Intl
 
 
414

 
380

 
8.9

1.4

7.5

WW
 
 
1,517

 
1,475

 
2.8

0.9

1.9

      XARELTO
 
 
 
 
 
 
 
 
 
     US
 
 
578

 
513

 
12.7

12.7


     Intl
 
 

 

 



     WW
 
 
578

 
513

 
12.7

12.7


      INVOKANA / INVOKAMET
 
 
 
 
 
 
 
 
 
     US
 
 
204

 
247

 
(17.4
)
(17.4
)

     Intl