Johnson & Johnson

Key Performance Metrics

  • The review of Net Profit Margin witnessed a fluctuating trend. The Net Profit Margin moved from 18.42% in 2019 to 41.28% in 2023.
  • The average EBIT Margin for the period under analysis was 28.19%, with 2020 and 2023 performing the worst and best, respectively.
  • In the current year, JOHNSON & JOHNSON was able to cover its interest liabilities 48.78 times – compared to 2019 when it was 55.49 times.
  • The Asset turnover stood at 0.47 times in 2023 from 0.53 in 2019, implying a low performance on Assets of the business in relation to revenue.

Profitability

  • The revenue of JOHNSON & JOHNSON has fluctuated year on year. The revenue increased by 0.64% between 2019 and 2020 and a further 1.59% increase was recorded between 2021 and 2022. There also occurred an increase of 6.46% between 2022 and 2023 (the current period). 
  • Johnson & Johnson’s performance in profitability looks good as the return on capital employed also recorded good performance during the period of analysis.

Liquidity

  • The company’s result in liquidity looks poor, as current ratio increased from 0.99:1 to 1.16:1 on the last year. Which implies that the company has enough assets to settle its current liabilities.

Capital Structure

  • Johnson & Johnson is both equity and debt financed.
  • The debt-to-equity (D/E) ratio has been falling year on year. The gearing position of the company appears to be high as it stood at 43% in the current year.

Source: Johnson & Johnson Annual Report

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