Post on 08-Jul-2015
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Investing in Your
HealthWith Cindy Wang
Founded 1886
By the three Johnson Brothers
New Brunswick Headquarters
Consumer Segment Representative
CONSUMER SEGMENT
An average of $15 billion in revenue each year since 2007.
40%, $26.4
24%, $14.6
36% $22.4
2010 Sales by Segment (billions)
Medical Devices and Diagnostics
Consumer
Pharmaceutical
Baby Care Oral Care
Over-the-Counter Medicines and Nutritionals
Skin Care Women’s Health
Wound Care/Other Lines
9 month Revenues for 2011
15.80%
10.80%
29.10%
24.70%
12.60%
7%
Baby Care
Oral Care
OTC Nutritionals
Skin Care
Women's Health
Wound Care
0
500
1000
1500
2000
2500
3000
3500
4000
2007 2008 2009 2010 2011
$U
.S.
(in
mil
lio
ns
)
Trend Analysis 2007-2011 of 9 Month Segment Sales
Baby Care
Oral Care
OTC/Nutritionals
Skin Care
Women's Health
Would Care
Trend Analysis of 9 Month Sales
• United States $6,408 (MM) $6,937 $6,837 $5,519
• International $8,085 $9,117 $8,966 $9,071
• Total $14,493 $16,054 $$15,803 $14,950
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
2007 2008 2009 2010
United States
International
Total
Taking a call…..
J & J consumer segment
• Consumer Segment Question
Medical Devices and Diagnostics Segment
Major franchises
Medical Devices and Diagnostics Segment
40%, $26.4
24%, $14.6
36%, $22.4
2010 Sales by Segment (billions)
Medical Devices and Diagnostics
Consumer
Pharmaceutical
2011 fiscal nine months sales: $19.3 billion
Medical Devices and Diagnostics Segment
2011 fiscal nine months
sales results• DePuy ⇧:
oMicrusEndovascular products
Ortho-Clinical Diagnostics ⇧: oVITROS ® 5600 and 3600 analyzers
Medical Devices and Diagnostics Segment
2011 fiscal nine months sales results (continued)• Vision Care ⇧: oACUVUE ® MOIST
®
oAstigmatism lenses• Cardiovascular Care ⇩: oEndovascular
products
Medical Devices and Diagnostics Segment
Globalization• Worth $350 billion worldwide
• >50% international
• Example: China
Medical Devices and Diagnostics Segment
2006 2007 2008 2009 2010
United States 10,110 10,433 10,541 11,011 11,412
International 10,173 11,303 12,585 12,563 13,189
Total 20,283 21,736 23,126 23,574 24,601
0
5,000
10,000
15,000
20,000
25,000
30,000
$U
.S.
Mil
lio
n
Sales to Customers
Pharmaceutical
0
5,000
10,000
15,000
20,000
25,000
2006 2007 2008 2009 2010
United States
International
Worldwide
U.S 15,092 15,603 14,831 13,041 12,519
International 8,175 9,263 9,736 9,479 9,877
Worldwide 23,267 24,866 24,567 22,520 22,396
Pharmaceutical
0
2000
4000
6000
8000
10000
12000
14000
2007 2008 2009 2010 2011
WorldWide
International
US
Pharmaceutical
In m
illi
on
s
In m
illi
on
s
15,000
15,500
16,000
16,500
17,000
17,500
18,000
18,500
19,000
2007
2008
2009
2010
2011
2011 Nine Months Fiscal: $18.3 billions
Expansion:
Research & Development in India
• Treatments:
• Prostate Cancer• Tuberculosis (TB)• HIV
Pharmaceutical
What do Investors Want?
High Market Stock Price
Constant Dividend Payment
Johnson And Johnson offers
Stability
Income Statement
Quarterly Annual
$ 922M expense due to:•Litigation Settlements•Product liability expense•DePuy ASR® Hip recall
Sept 30, 2011
Gross Profit Margin: 68.31%Net Profit Margin: 20.01%
*google finance *google finance
Balance Sheet
Quarterly Annual
Sept 30, 2011
Return on Equity: 19.16%Debt to Equity: 0.30
*google finance*google finance
Cash Flow Statement
Quarterly Annual
Most of the Investments are
purchase of government securities and obligations
Sept 30, 2011
Free Cash Flow: $4.49BCash Debt Coverage: 0.80
*google finance *google finance
The ‘Trend’
• Yield = $ 3.72
• P/E = $14.94
• 52 Week Range = $57.50 - $68.05
• Shares: 2.73B
*google finance
Beta = 0.54
S&P H/C Equipment$99.24
S&P 500 Stock Index$111.99
J&J$118.87
What does
$100 dividend
reinvestment
will do to total
shareholder
return?
*google finance
*Johnson and Johnson 2010 Annual report
Our line of responsibilities
Shareholders
Communities
Employees
Customers and Patients
Benefits of acquiring Synthes Inc.
Increase medical device market share by more
than 25%
Better serve clinicians and patients worldwide
Transformational innovation to enhance patient care
• *Johnson and Johnson 2010 Annual report
“Caring for the World…One Person at a Time”
End Credits
Cast (in order of appearance)
Cindy Wang ………………………………………………………………… Energetic Host
Stephanie Camello …………………………………Consumer segment representative
Dianna Chen ………………………………………Medical Devices and Diagnostics segment representative
Stella Lim …………………………………………. Pharmaceutical segment representative
Philip Effendy …………………………………………. Financial analyst
Peter Effendy ……………………………………… William Weldon, J&J’s CEO
This Production has been brought to you by the USC
Marshall School of Business
Sponsored by: Professor of Accounting, at the USC
Leventhal School of Accounting, Professor
Freed
In conjunction with the programs Investing in a Trojanand Traveler’s Investments