Mead Johnson Nutrition Company (NYSE: MJN) today announced its financial results for the quarter ended June 30, 2014.
- Second quarter sales of $1,111.1 million increased five percent from $1,055.3 million in the prior-year quarter. Sales were up 10 percent on a constant dollar basis.
- On a constant dollar sales basis, the Latin America segment grew 14 percent, the Asia segment grew 11 percent and the North America/Europe segment grew 4 percent.
- GAAP net earnings of $0.84 per diluted share for the second quarter of 2014 were in line with the prior year. The impact from higher sales and a lower effective tax rate was offset by higher dairy input costs, foreign exchange impacts, increased investments in demand creation and mark-to-market pension accounting (“MTM”) adjustments for certain employee benefit plans.
- Non-GAAP (1) net earnings were $0.88 per diluted share for the second quarter of 2014, a slight increase from the $0.87 per diluted share earned in the second quarter of 2013.
- For the full year, Mead Johnson now expects GAAP EPS guidance, excluding any further pension MTM adjustments, to be in the range of $3.59 to $3.66 per diluted share, as compared to the previously reported range of $3.54 to $3.66 per diluted share. Non-GAAP EPS, which excludes Specified Items, (1) is expected to be in the range of $3.65 to $3.72 per diluted share, as compared to the previously reported range of $3.60 to $3.72 per diluted share.
(1) For the definition of Specified Items and a reconciliation of GAAP and non-GAAP results, see “Non-GAAP Financial Measures” on the schedule titled “Supplemental Financial Information” included in this release.
“We are pleased with our overall performance in the second quarter,” said Chief Executive Officer Kasper Jakobsen. “Constant dollar sales grew by double digits again this quarter. Growth in Asia remained strong across most markets, including our biggest business in China/Hong Kong. Our North America/Europe segment continued to show growth and helped us offset a relatively weaker quarter in Latin America, where we were challenged to fully offset currency weakness with higher prices. As expected and discussed in our last earnings call, higher dairy costs put pressure on gross margin and limited earnings growth for the quarter. Despite pressure on our margin, we continued to invest in advertising and promotion at record levels. This demonstrates our commitment to our longer-term growth ambition and we still managed to grow year-to-date non-GAAP earnings per share by eight percent.”