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3M Posts Record Third-Quarter Sales and Earnings per Share
[October 24, 2014]

3M Posts Record Third-Quarter Sales and Earnings per Share


(ENP Newswire Via Acquire Media NewsEdge) ENP Newswire - 24 October 2014 Release date- 23102014 - 3M Posts Record Third-Quarter Sales and Earnings per Share.

Third-Quarter Highlights: Organic local-currency sales growth of 3.9 percent Earnings of $1.98 per share, up 11.2 percent Operating income margins of 23.4 percent, up 1.4 percentage points year-on-year Free cash flow conversion of 103 percent Returned $1.8 billion to shareholders via dividends and gross share repurchases Acquired remaining 25 percent of Sumitomo 3M for $865 million ST. PAUL, Minn -3M (NYSE: MMM) today reported third-quarter earnings of $1.98 per share, an increase of 11.2 percent versus the third quarter of 2013. Sales grew 2.8 percent year-on-year to $8.1 billion. Organic local-currency sales grew 3.9 percent, acquisitions added 0.1 percent to sales and currency impacts reduced sales by 1.2 percent year-on-year.



Third-quarter operating income was $1.9 billion and operating income margins were 23.4 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 $550 million in cash dividends to shareholders and repurchased $1.2 billion of its own shares during the quarter.


Organic local-currency sales growth was 5.4 percent in Health Care, 4.3 percent in Electronics and Energy, 4.2 percent in Industrial, and 3.1 percent in both Consumer, and Safety and Graphics. On a geographic basis, organic local-currency sales grew 6.0 percent in the U.S., 4.9 percent in Asia Pacific, 0.8 percent in EMEA (Europe, Middle East and Africa) and 0.4 percent in Latin America/Canada.

'This was another strong quarter for 3M,' said Inge G. Thulin, 3M's chairman, president and chief executive officer. 'The 3M team once again delivered broad-based organic growth with operating margins exceeding 22 percent in all businesses. As we look forward, our focus will remain on actively managing the portfolio and strategically investing in the business to continue delivering profitable growth across the company. 3M remains on track to deliver its long-term financial objectives.' 3M updated its 2014 full-year performance expectations. The company now anticipates earnings in the range of $7.40 to $7.50 per share versus a prior expectation of $7.30 to $7.55. Organic local-currency sales growth is expected to be 4 to 5 percent versus 3 to 6 percent previously. 3M estimates foreign currency impacts will reduce sales by approximately 1.5 percent for the year versus a previous estimate of approximately 1 percent. The company also updated its full-year free cash flow conversion expectation to 95 to 100 percent from a prior range of 90 to 100 percent.

Third-Quarter Business Group Discussion Industrial Sales of $2.8 billion, up 3.0 percent in U.S. dollars. Organic local-currency sales increased 4.2 percent and foreign currency translation reduced sales by 1.2 percent.

On an organic local-currency basis: Sales growth was led by aerospace and commercial transportation, 3M purification, automotive OEM, advanced materials, and industrial adhesives and tapes; sales declined in personal care.

Sales growth was strongest in the U.S., followed by Asia Pacific and EMEA; sales declined in Latin America/Canada.

Operating income was $616 million, up 7.9 percent year-on-year; operating margin of 22.2 percent.

Electronics and Energy Sales of $1.5 billion, up 3.5 percent in U.S. dollars. Organic local-currency sales increased 4.3 percent and foreign currency translation reduced sales by 0.8 percent.

On an organic local-currency basis: Sales in electronics-related businesses rose 8 percent year-on-year with strong growth in display materials and systems and in electronics materials solutions; energy-related businesses declined 2 percent.

Strongest growth in Asia Pacific and the U.S.; Latin America/Canada was flat and EMEA declined year-on-year.

Operating income was $338 million, up 12.5 percent year-on-year; operating margin of 22.5 percent.

Safety and Graphics Sales of $1.4 billion, up 1.3 percent in U.S. dollars. Organic local-currency sales increased 3.1 percent and foreign currency translation reduced sales by 1.8 percent.

On an organic local-currency basis: Sales growth was led by personal safety, and traffic safety and security; sales declined in roofing granules.

Sales rose in the U.S. and EMEA, were flat in Latin America/Canada and declined slightly in Asia Pacific.

Operating income was $340 million, an increase of 8.8 percent year-on-year; operating margin of 23.5 percent.

Health Care Sales of $1.4 billion, up 4.7 percent in U.S. dollars. Organic local-currency sales increased 5.4 percent, acquisitions (Treo Solutions) added 0.5 percent to sales and foreign currency translation decreased sales by 1.2 percent.

On an organic local-currency basis: Sales increased across the portfolio, led by double-digit growth in drug delivery systems and health information systems.

Sales grew in all major geographies led by Asia Pacific, Latin America/Canada and the U.S.

Operating income was $432 million, an increase of 1.4 percent; operating margin of 31.0 percent.

Consumer Sales of $1.2 billion, up 2.1 percent in U.S. dollars. Organic local-currency sales increased 3.1 percent and foreign currency translation reduced sales by 1.0 percent.

On an organic local-currency basis: Sales grew in DIY, consumer health care and home care; stationery and office supplies declined year-on-year.

Sales rose in Asia Pacific and the U.S. but declined in Latin America/Canada and EMEA.

Operating income was $272 million, up 10.1 percent year-on-year; operating margin of 23.2 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 within the U.S. or +1 402-977-9140 outside the U.S. (for both U.S. and outside the U.S.; access code is 21682154).

The telephone replay will be available until 10:30 a.m. CDT on October 28, 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.

Contact: 3M Investor Contacts: Matt Ginter, 651-733-8206 or Bruce Jermeland, 651-733-1807 or Media Contact: Jocelyn Parker, 651-737-6099 (c) 2014 Electronic News Publishing -

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