(Reuters) -Kenvue, the former consumer health unit of Johnson & Johnson, forecast full-year profit above Wall Street estimates on Thursday, betting on resilient demand for its skincare and self-care products such as Neutrogena and Tylenol.
Consumers focusing on spending on essential, daily use products amid a cost-of-living crisis in some parts of the world has boosted companies such as Kenvue and peer Haleon.
Kenvue, in its first results after being spun off from Johnson & Johnson in May, forecast full-year adjusted profit per share between $1.26 and $1.31.
Analysts on average were expecting $1.23 per share, according IBES data from Refinitiv.
Net sales at Kenvue’s self-care business, which houses over-the-counter products or nonprescription medicines, jumped 12.2% in the second-quarter on the back of increased demand from higher cough, cold and flu cases.
However, adjusted gross profit margin came in at 57.5%, compared to 59.3% a year earlier, dragged by a strong dollar and higher costs.
Meanwhile, J&J raised its 2023 profit forecast on Thursday, banking on the strength in its medical devices business and demand for its cancer drugs such as Darzalex.
J&J, which owns about 90% of Kenvue’s outstanding shares, said it intends to “split off” the shares through an exchange offer as the form of its next step in the separation, subject to market conditions.
The company sees fiscal 2023 reported net sales growth to be in the range of 4.5% to 5.5%.
Net sales rose 5.4% to $4.01 billion while adjusted profit per share came in at 32 cents.
(Reporting by Ananya Mariam Rajesh and Raghav Mahobe in Bengaluru; Editing by Devika Syamnath and Sriraj Kalluvila)
