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TMCNet:  3M Reports Record Quarterly Sales of $8.1 Billion and Earnings of $1.91 per Share

[July 25, 2014]

3M Reports Record Quarterly Sales of $8.1 Billion and Earnings of $1.91 per Share

(ENP Newswire Via Acquire Media NewsEdge) ENP Newswire - 25 July 2014 Release date- 24072014 - 3M Reports Record Quarterly Sales of $8.1 Billion and Earnings of $1.91 per Share.

Second-Quarter Highlights: Organic local-currency sales growth of 4.8 percent Earnings of $1.91 per share, up 11.7 percent Operating income margins of 22.8 percent, up 0.8 percentage points year-on-year Free cash flow conversion of 103 percent Returned $2.0 billion to shareholders via dividends and gross share repurchases Announced (July 16) acquisition of remaining 25 percent of Sumitomo 3M subsidiary for 90 billion Japanese Yen (approximately $885 million) ST. PAUL, Minn - 3M (NYSE: MMM) today reported second-quarter earnings of $1.91 per share, an increase of 11.7 percent versus the second quarter of 2013. Sales grew 4.9 percent year-on-year to $8.1 billion. Organic local-currency sales grew 4.8 percent, acquisitions added 0.1 percent to sales and currency impacts were flat year-on-year.

Second-quarter operating income was $1.9 billion and operating income margins were 22.8 percent. Net income was $1.3 billion and the company converted 103 percent of net income to free cash flow in the quarter.

3M paid $556 million in cash dividends to shareholders and repurchased $1.4 billion of its own shares during the quarter.

Organic local-currency sales growth was 6.4 percent in Electronics and Energy, 5.1 percent in Health Care, 4.7 percent in Industrial, 4.7 percent in Safety and Graphics and 4.2 percent in Consumer. On a geographic basis, organic local-currency sales grew 6.6 percent in Asia Pacific, 4.8 percent in EMEA (Europe, Middle East and Africa), 4.5 percent in the U.S. and 2.7 percent in Latin America/Canada.

'Our businesses continued to execute very well in the second quarter,' said Inge G. Thulin, 3M's chairman, president and chief executive officer. 'Organic sales growth was again positive across all businesses and geographic regions which helped drive double-digit growth in earnings per share. Strong productivity fueled increased growth investments, and operating margins increased year-on-year to nearly 23 percent.' Thulin continued, 'In addition to a strong operating performance, we are also deploying capital more aggressively to both improve the business and to enhance shareholder returns. On July 16, we announced the acquisition of the remaining 25 percent of our Sumitomo 3M subsidiary in Japan for a purchase price of $885 million. And during the second quarter we paid $2.0 billion to shareholders via a combination of cash dividends and gross share repurchases. My thanks to the 3M team for the results thus far in 2014.' 3M also confirmed its 2014 full-year performance expectations. The company continues to expect earnings of $7.30 to $7.55 per share and organic local-currency sales growth of 3 to 6 percent. Foreign currency impacts are expected to reduce sales by approximately 1 percent for the year. 3M also expects full-year free cash flow conversion to be in the range of 90 to 100 percent.

Second-Quarter Business Group Discussion Industrial Sales of $2.8 billion, up 4.9 percent in U.S. dollars. Organic local-currency sales increased 4.7 percent and foreign currency translation increased sales by 0.2 percent.

On an organic local-currency basis: Sales growth was led by 3M purification, automotive OEM, aerospace and commercial transportation, abrasives, and industrial adhesives and tapes.

Positive sales growth in Asia Pacific, the U.S. and EMEA, while Latin America/Canada was down slightly.

Operating income was $617 million, up 2.4 percent year-on-year; operating margin of 21.9 percent.

Safety and Graphics Sales of $1.5 billion, up 4.1 percent in U.S. dollars. Organic local-currency sales increased 4.7 percent and foreign currency translation reduced sales by 0.6 percent.

On an organic local-currency basis: Sales growth was strongest in the personal safety and commercial solutions businesses; sales declined in roofing granules.

Sales increased in all regions, with the largest increases in EMEA and the U.S.

Operating income was $353 million, an increase of 7.4 percent year-on-year; operating margin of 23.6 percent.

Electronics and Energy Sales of $1.4 billion, up 6.2 percent in U.S. dollars. Organic local-currency sales increased 6.4 percent and foreign currency translation reduced sales by 0.2 percent.

On an organic local-currency basis: Sales in electronics-related businesses rose 11 percent year-on-year, while energy-related businesses grew 1 percent.

Positive sales growth in Latin America/Canada, Asia Pacific and EMEA, while the U.S. was flat.

Operating income was $293 million, up 23.4 percent year-on-year; operating margin of 20.6 percent.

Health Care Sales of $1.4 billion, up 5.9 percent in U.S. dollars. Organic local-currency sales increased 5.1 percent, acquisitions (Treo Solutions) added 0.4 percent to sales and foreign currency translation increased sales by 0.4 percent.

On an organic local-currency basis: Sales grew across the portfolio, with the strongest growth in health information systems, critical and chronic care, and infection prevention.

Sales rose in all geographies, with the largest growth in Latin America/Canada, Asia Pacific and the U.S.

Operating income was $434 million, an increase of 4.1 percent; operating margin of 30.7 percent.

Consumer Sales of $1.1 billion, up 3.7 percent in U.S. dollars. Organic local-currency sales increased 4.2 percent, divestitures reduced sales by 0.2 percent and foreign currency translation reduced sales by 0.3 percent.

On an organic local-currency basis: Sales growth led by DIY, consumer health care and home care.

Positive sales growth in Asia Pacific, the U.S. and EMEA, while Latin America/Canada was down slightly.

Operating income was $241 million, up 2.3 percent year-on-year; operating margin of 21.1 percent.

3M will conduct an investor teleconference at 9:00 a.m. EDT (8:00 a.m. CDT) today. Investors can access this conference via the following: Live webcast at http://investor.3M.com.

Live telephone: Call 800-762-2596 within the U.S. or +1 212-231-2916 outside the U.S. Please join the call at least 10 minutes before the start time.

Webcast replay: Go to 3M's Investor Relations website at http://investor.3M.com and click on 'Quarterly Earnings.' Telephone replay: Call 800-633-8284 (for both U.S. and outside the U.S.; access code is 21682153).

The telephone replay will be available until 10:30 a.m. CDT on July 29, 2014.

Forward-Looking Statements This news release contains forward-looking information about 3M's financial results and estimates and business prospects that involve substantial risks and uncertainties. You can identify these statements by the use of words such as 'anticipate,' 'estimate,' 'expect,' 'project,' 'intend,' 'plan,' 'believe,' 'will,' 'target,' 'forecast' and other words and terms of similar meaning in connection with any discussion of future operating or financial performance or business plans or prospects. Among the factors that could cause actual results to differ materially are the following: (1) worldwide economic and capital markets conditions and other factors beyond 3M's control, including natural and other disasters affecting the operations of 3M or its customers and suppliers; (2) 3M's credit ratings and its cost of capital; (3) competitive conditions and customer preferences; (4) foreign currency exchange rates and fluctuations in those rates; (5) the timing and market acceptance of new product offerings; (6) the availability and cost of purchased components, compounds, raw materials and energy (including oil and natural gas and their derivatives) due to shortages, increased demand or supply interruptions (including those caused by natural and other disasters and other events); (7) the impact of acquisitions, strategic alliances, divestitures, and other unusual events resulting from portfolio management actions and other evolving business strategies, and possible organizational restructuring; (8) generating fewer productivity improvements than estimated; (9) unanticipated problems or delays with the phased implementation of a global enterprise resource planning (ERP) system, or security breaches and other disruptions to 3M's information technology infrastructure; and (10) legal proceedings, including significant developments that could occur in the legal and regulatory proceedings described in 3M's Annual Report on Form 10-K for the year ended December 31, 2013, and its subsequent quarterly reports on Form 10-Q (the 'Reports'). Changes in such assumptions or factors could produce significantly different results. A further description of these factors is located in the Reports under 'Cautionary Note Concerning Factors That May Affect Future Results' and 'Risk Factors' in Part I, Items 1 and 1A (Annual Report) and in Part I, Item 2 and Part II, Item 1A (Quarterly Report). The information contained in this news release is as of the date indicated. 3M assumes no obligation to update any forward-looking statements contained in this news release as a result of new information or future events or developments.

3M Company and Subsidiaries CONSOLIDATED STATEMENT OF INCOME: See Full Press Release at: http://news.3m.com/press-release/company/3m-reports-record-quarterly-sales-81-billion-and-earnings-191-share About 3M 3M captures the spark of new ideas and transforms them into thousands of ingenious products. Our culture of creative collaboration inspires a never-ending stream of powerful technologies that make life better. 3M is the innovation company that never stops inventing. With $31 billion in sales, 3M employs 89,000 people worldwide and has operations in more than 70 countries.

Contact: 3M Investor Contacts: Matt Ginter, 651-733-8206 or Bruce Jermeland, 651-733-1807 or Media Contact: Donna Fleming Runyon, 651-736-7646 (c) 2014 Electronic News Publishing -

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