J&J Restructures Medical Device BusinessBy
Johnson & Johnson has announced restructuring actions in its medical devices businesses. The company's consumer medical devices businesses, vision care, and diabetes care, are not impacted by these actions.
The actions are expected to result in annualized pre-tax cost savings of $800 million to $1.0 billion, the majority of which is expected to be realized by the end of 2018, including approximately $200 million in 2016. In connection with its plans, the company expects to record pre-tax restructuring charges of approximately $2.0 billion to $2.4 billion, which will be treated as special items, of which approximately $600 million will be recorded in the fourth quarter of 2015. The company confirmed the full-year 2015 guidance it provided on October 13, 2015 for sales of $70.0 billion to $71.0 billion and adjusted earnings for the full-year 2015 of $6.15 to $6.20 per share, which excludes special items such as restructuring charges.
The company estimates that the actions announced today will result in position eliminations of approximately 4 %to 6%of the medical devices segment's global workforce over the next two years, subject to any consultation procedures in countries where required.
Source: Johnson & Johnson