Despite The Revenue Fall, J&J’s Business Has A Silver Lining
1) As expected, J&J’s revenue fell in Q4 as well as for full year 2015
| J&J’s Revenue & EPS Growth | Units | Value |
| Q4 2015 | ||
| Revenue Growth | % | -2.40% |
| EPS Growth | % | 5.10% |
| Full Year 2015 | ||
| Revenue Growth | % | -5.70% |
| EPS Growth | % | -3.00% |
2) Primary culprits were currency impact & Olysio sales plummeting
| J&J’s 2015 Revenue Bridge | Units | Value |
| J&J 2014 Revenue | $ Bil | 74.3 |
| – Negative Impact Of Currency Movement | $ Bil | -5.6 |
| – Operational Decline In Olysio Drug Sales | $ Bil | -1.6 |
| – Operational Decline In Medical Devices Revenue | $ Bil | -0.4 |
| + Operational Increase In Remaining Pharma Revenue | $ Bil | 3.0 |
| + Operational Increase In Consumer Revenue | $ Bil | 0.4 |
| = J&J 2015E Revenue | $ Bil | 70.1 |
3) However, J&J’s Growth Is Likely To Bounce Back
| Medical Devices Business Could Revive | ||
| Medical Devices Operational Growth For Q4 2015 | % | 3.4% |
| Medical Devices Operational Growth For Full Year 2015 | % | -1.4% |
| -> Orthopedics, Surgery & Vision Care Growing Well | ||
| Pharma Pipeline Gives Hope | ||
| New Pharma Products J&J Expects To File By 2019 | 10 | |
| Average Peak Sales Potential (Per Drug) Of These Products | $ Bil | 1 |
| Probability Adjusted Total Annual Peak Sales | $ Bil | 5 |
| As % Of J&J’s Current Sales | % | 7% |
| Cost Savings Could Help Bottomline | ||
| Annual Operational Savings J&J Expects To Realize By 2018 | $ Bil | 1 |
| -> Potential EPS Impact | % | ~ 5% |
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Have more questions about Johnson & Johnson? See the links below.
- Drugs, Devices, Consumer: What’s Johnson & Johnson’s Revenue and Earnings breakdown?
- What’s J&J’s Fundamental Value Based On Expected 2015 Results?
- How Increased Focus On Pharmaceuticals In The Last 5 Years Has Helped J&J?
- By How Much Can J&J’s Revenue And EBITDA Grow Over The Next 3 Years?
- What’s J&J’s Fundamental Value Based On Expected 2015 Results?
- How Much Revenues Can J&J’s Phase 3 Pipeline Add By 2020?
- What Percentage Of Its Revenue Could J&J Lose Solely Due To Patent Losses Over The Next 5 Years?
- If Remicade Biosimilar Hits The U.S. Market In 2017, Does J&J Face Any Meaningful EPS Decline?
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Johnson & Johnson
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