Spreadsheet: 32e42e87-0ce2-4a9c-83aa-e6f9817b55d5
Sheet: Earnings

Johnson & Johnson and Subsidiaries
Condensed Consolidated Statement of Earnings
(Unaudited; in Millions Except Per Share Figures) |  |  | FIRST QUARTER
 |  |  | 2012 |  |  |  | 2011 |  |  |  | Percent
 |  |  |  |  | Percent |  |  |  | Percent |  | Increase
 |  |  | Amount |  | to Sales |  | Amount |  | to Sales |  | (Decrease)
Sales to customers |  |  | 16139 |  | 100 |  | 16173 |  | 100 |  | -0.2102269214122303
Cost of products sold |  |  | 4915 |  | 30.35417931718198 |  | 4778 |  | 29.54306560316577 |  | 2.867308497279196
Selling, marketing and administrative expenses |  |  | 5015 |  | 31.07379639382861 |  | 5056 |  | 31.26197984294812 |  | -0.8109177215189873
Research and development expense |  |  | 1645 |  | 10.1927009108371 |  | 1738 |  | 10.75630557101342 |  | -5.350978135788263
Interest (income)expense, net |  |  | 130 |  | 0.8055021996406221 |  | 104 |  | 0.6430470537315279 |  | 25
Other (income)expense, net |  |  | -611 |  | -3.785860338310924 |  | -13 |  | -0.08038088171644099
Earnings before provision for taxes on income |  |  | 5045 |  | 31.2596815168226 |  | 4510 |  | 27.8859828108576 |  | 11.86252771618625
Provision for taxes on income |  |  | 1135 |  | 7.132653819939277 |  | 1034 |  | 6.393371668830768 |  | 9.767891682785299
Net earnings |  |  | 3910 |  | 24.22702769688333 |  | 3476 |  | 21.49261114202683 |  | 12.48561565017261
Net earnings per share  (Diluted) |  |  | 1.41 |  |  |  | 1.25 |  |  |  | 12.8
Average shares outstanding  (Diluted) |  |  | 2774.9 |  |  |  | 2772.7
Effective tax rate |  |  | 22.49752229930624 | % |  |  | 22.92682926829269 | %
Adjusted earnings before provision for taxes and net earnings (1) (A)
Earnings before provision for taxes on income |  |  | 4928 |  | 30.53472953714604 |  | 4856 |  | 30.02535089346441 |  | 1.482701812191104
Net earnings |  |  | 3804 |  | 23.57023359563789 |  | 3747 |  | 23.16824336857726 |  | 1.521216973578863
Net earnings per share  (Diluted) |  |  | 1.37 |  |  |  | 1.35 |  |  |  | 1.481481481481483
Effective tax rate |  |  | 22.8 | % |  |  | 22.8 | %
(1) See Reconciliation of Non-GAAP Financial Measures.
(A) NON-GAAP FINANCIAL MEASURES "Adjusted earnings before provision for taxes on income," "adjusted net earnings," "adjusted net earnings per share (diluted)," and "adjusted effective tax rate" are non-GAAP financial measures and should not be considered replacements for GAAP results. The Company provides earnings before provision for taxes on income, net earnings, net earnings per share (diluted), and effective tax rate on an adjusted basis because management believes that these measures provide useful information to investors. Among other things, these measures may assist investors in evaluating the Company's results of operations period over period. In various periods, these measures may exclude such items as significant costs associated with acquisitions, restructuring, litigation, and changes in applicable laws and regulations (including significant accounting or tax matters).  Special items may be highly variable, difficult to predict, and of a size that sometimes has substantial impact on the Company's reported results of operations for a period. Management uses these measures internally for planning, forecasting and evaluating the performances of the Company's businesses, including allocating resources and evaluating results relative to employee performance compensation targets. Unlike earnings before provision for taxes on income, net earnings, net earnings per share (diluted), and effective tax rate prepared in accordance with GAAP, adjusted earnings before provision for taxes on income, adjusted net earnings, adjusted net earnings per share (diluted), and adjusted effective tax rate may not be comparable with the calculation of similar measures for other companies. These non-GAAP financial measures are presented solely to permit investors to more fully understand how management assesses the performance of the Company. The limitations of using these non-GAAP financial measures as performance measures are that they provide a view of the Company's results of operations without including all events during a period, such as the effects of an acquisition, restructuring, litigation, and changes in applicable laws and regulations (including significant accounting or tax matters) and do not provide a comparable view of the Company's performance to other companies in the health care industry. Investors should consider non-GAAP financial measures in addition to, and not as replacements for, or superior to, measures of financial performance prepared in accordance with GAAP.