J&J personal care sales contribute to solid year

By Guy Montague-Jones

- Last updated on GMT

Related tags: Percent, Generally accepted accounting principles, Johnson & johnson

Johnson & Johnson (J&J) posted high fourth quarter sales
growth supported by a sharp rise in personal care sales that helped
the company achieve strong full year financial results.

The New Jersey-based company reported sales of $16bn for the quarter, an increase of 16.6 percent on the same period last year, contributing to a 14.6 percent rise in net sales for the full year to $61bn. However, the profit figures were less spectacular due to high restructuring costs. Operating income fell 13.9 percent over Q4 to $2.3bn while lower tax charges helped the company achieve a 9.5 percent increase in net profit. For the full year operating income fell 8.9 percent to $13.3bn while net profit dropped 4.3 percent to $10.6bn. "Despite challenges in certain markets, our broad base of businesses allowed us to achieve solid results in 2007, building on our foundation of long-term profitable growth,"​ said CEO William Weldon. Sales in the consumer division, which includes most of the firm's personal care brands, rose 48.5 percent to $3.8bn for the fourth quarter. Accounting for the acquisition of Pfizer Consumer Health (PCH) sales in the consumer segment increased at the slower rate of 4.6 percent. In an earnings call, J&J vice president Louise Mehrotra told analysts that the company's skin care business achieved sales growth of 9 percent during the fourth quarter. The addition of the PCH products contributed to this growth but even excluding the impact of the acquisition sales rose by 4 percent. The Johnson's Adult, Clean and Clear and VaneDone product lines achieved double-digit growth while the performance of the Nutrogena range was described as solid. Commenting on future plans, Weldon said: "Ongoing product introductions and geographic expansion of major brands such as newly acquired Listerine and Nicorette, along with our key skin care brands will continue to be growth drivers and we will continue to focus on growth in emerging markets."

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