More Images
NEW BRUNSWICK, N.J.—Johnson & Johnson (NYSE: JNJ) reported Tuesday that its first-quarter sales rose 3.3 percent to $20.7 billion, with the pharmaceutical and consumer health segments driving the sales growth in the period. The increase was 4.8 percent on an operational basis and 5.6 percent on an adjusted operational basis, which is “inclusive of the overall estimated negative impact of the COVID-19 pandemic,” the announcement noted. Sales in the medical devices business segment (which includes contact lenses) declined 4.8 percent on a worldwide adjusted operational basis, which J&J attributed to the “net negative impact of the COVID-19 pandemic and the associated deferral of medical procedures to our surgery, orthopaedics, interventional solutions and vision businesses.”

J&J’s net earnings in the quarter rose 54.6 percent to approximately $5.8 billion (from $3.75 billion in the year-ago period).

The company said the “strong performance” in the first quarter reflects the efforts of its teams around the world and the sustainability of its business model. The company also noted that it believes its “long-term fundamentals remain intact, but that it was reducing its 2020 sales and earnings guidance to reflect the COVID-19 impact and related investments."

In its U.S. vision care business, J&J said sales slipped 1.6 percent to $439 million (from $446 million). Worldwide vision care sales declined 5.5 percent to $1.067 billion (from $1.129 billion).

The contact lens business, however, showed growth in the first quarter in the U.S. market, with sales rising 7.7 percent to $346 million. On a worldwide basis, sales in the contact lens segment fell 1.3 percent to $814 million from $824 million. International sales of contact lenses declined 7 percent to $467 million.

“With Johnson & Johnson's century-plus history of leading in times of great challenge, we are mobilizing our resources across the company in the fight against the COVID-19 pandemic," chairman and chief executive officer Alex Gorsky said in the announcement. “Johnson & Johnson is built for times like this, and we are leveraging our scientific expertise, operational scale and financial strength in the effort to advance the work on our lead COVID-19 vaccine candidate.”

He added, “We are committed to beginning production at risk imminently and bringing an affordable and accessible vaccine to the public on a not-for-profit basis for emergency pandemic use."

In terms of 2020 guidance, J&J lowered its worldwide sales estimate for the year to a range of $77.5 billion to $80.5 billion, which would represent a decrease of between minus-2 percent and minus-5.5 percent compared with the year-ago period. Previously, J&J had forecast sales growth in a range of 4 percent to 5 percent for the 2020 fiscal year.

The company also announced Tuesday that its board had declared a 6.3 percent increase in the quarterly dividend rate, raising the dividend from 95 cents per share to $1.01 per share. It marked the 58th consecutive year J&J has raised its dividend, according to the announcement.