Johnson & Johnson Restructures Medical Devices Unit, Sees Nearly $1 Billion In Annual Cost Savings

Johnson & Johnson JNJ announced on Tuesday the company is cutting 6 percent of its medical device jobs in efforts to remove $1 billion in annual costs from the business which makes surgical tools and sterilization equipment.

The newly eliminated positions account for 2.5 percent of the company's global workforce and up to 6 percent of the company's medical device segment.

Medical device sales have been challenged recently for J&J, with its sales falling 2.9 percent in the first nine months of the year and 3.4 percent in the United States. The company stated that "the changing needs of the global medical device market" reflects its restructuring.

The $800 million planned to be cut to its $1 billion in pretax annualized costs, is expected by the end of 2018. J&J stated that the restructuring would allow the company more flexibility to fund new growth.

J&J also declared a quarterly dividend, which is expected to be paid on March 8.

Investors will receive a $0.75 dividend on February 23. The company's previous quarterly dividend was of $0.61. The ex-dividend date of the latest dividend is February 19, and represents a $3.00 dividend on an annualized basis and a dividend yield of 3.09 percent.