Dive Brief:
- In its Q1 earnings results, pediatric nutrition provider Mead Johnson Nutrition Company reported a 1.7% drop in sales to $1.09 billion, down from $1.11 billion for last year's first fiscal quarter. This figure missed analysts' estimates of $1.135 billion.
- The company's gross margin jumped to 64%, which the company attributed to pricing increases from 2014 and lower dairy costs.
- Mead Johnson also reaffirmed its full-year 2015 non-GAAP guidance.
Dive Insight:
In three of the company's markets, Asia, Latin America, and North America/Europe, it saw mixed results in Q1. Sales in Asia, accounting for 53.1% of total sales, dropped 2% due to the company's volume being hurt by protests about cross-border trade in Hong Kong. The decline was also due to its comparison to a strong Q1 2014, wherein the company benefited from disruptions in several competitors' Asian market supplies. Another 3.8% drop year over year in its Latin America market was offset by a slight 0.3% increase in the North America/Europe market. However, that positive figure wasn't enough to make up for issues in Asia as well as the foreign currency issues many other companies have seen as well.
In other news, Mead Johnson reported last month that its CFO and executive VP Peter G. Leemputte would be stepping down, though he will stay on until June to help with the transition. Late last year, rumors that Danone may acquire Mead Johnson spread through the headlines.