Exhibit 99

 

FOR IMMEDIATE RELEASE

 

3M Reports First-Quarter Results

 

- Company Updates Sales and Earnings Outlook  -

 

ST. PAUL, Minn. — April 24, 2009 - 3M (NYSE: MMM) today announced first-quarter sales of $5.1 billion, a decrease of 21.3 percent from the first quarter of 2008. Net income was $518 million, or $0.74 per share, versus $1.0 billion, or $1.38 per share in the corresponding period last year (a). Excluding special items in 2009 (b), per share earnings were $0.81, down 41 percent year-on-year.

 

“As expected, the global economic slowdown dramatically affected our businesses in the first quarter,” said George W. Buckley, 3M chairman, president and CEO. “Substantial end-market declines and continued inventory takedowns in major industries, including automotive, consumer electronics and general industrial manufacturing, resulted in significantly lower sales and profits.  Accordingly, we aggressively reduced our cost structure, lowered manufacturing output and intensified our attention to operational improvement. The combination of these actions drove strong operating income margins of more than 17 percent.”

 

Buckley continued, “In these extraordinary times, 3M employees around the world are energized by the challenges, remain keenly focused on our customers and are steadfastly committed to building for the future. In 2009, we will enhance our balance sheet by improving our free cash flow while still maintaining a significant investment in R&D. Our strategy will strengthen the company and position us for even greater success when global economies recover.”

 

The company adjusted its 2009 sales and earnings expectations to reflect ongoing global economic uncertainty. 3M now expects 2009 organic sales volume to decline between 11 percent and 15 percent, versus a previous planning assumption of negative 5 percent to negative 9 percent. The company also expects 2009 full-year earnings to be in the range of $3.90 to $4.30 per share, down from a previous range of $4.30 to $4.70. All estimates quoted exclude special items.

 

Key Financial Highlights

 

First-quarter worldwide sales totaled $5.1 billion, a decrease of 21.3 percent versus last year. Local-currency sales including acquisitions decreased 13.9 percent, and foreign exchange impacts reduced sales by an additional 7.1 points in the quarter. Local-currency sales including acquisitions increased 1.9 percent in Health Care, but declined in the remaining segments with Consumer and Office down 0.1 percent, Safety, Security and Protection Services down 3.6 percent, Industrial and Transportation down 20.7 percent, Display and Graphics down 26.6 percent and Electro and Communications down 29.8 percent. Excluding special items, first-quarter net income was $563 million, or $0.81 per share, versus $1.0 billion, or $1.38 per share, in the first quarter of 2008. Net income and earnings per share declined 43 percent and 41 percent respectively, excluding special items (b).

 



 

Business Segment Discussion

(Operating income and margin figures exclude special items (b))

 

Industrial and Transportation

 

·                  Sales decreased 27.5 percent to $1.6 billion.

·                  Local-currency sales declined 20.7 percent including a 2.8 percent increase from acquisitions.

·                  Foreign currency translation reduced sales by 6.8 percent.

·                  50 percent decline in North American auto builds directly impacted 3M’s auto OEM business; many other industrial market segments were down by more than 20 percent.

·                  Local-currency sales down mid-single digits in Latin America, all other major geographies declined by double-digits.

·                  Operating income of $197 million, with margins of 12.4 percent.

 

Health Care

 

·                  Sales of $1.0 billion, down 7.7 percent, including a negative 9.6 percent impact from foreign currency translation.

·                  Local-currency sales growth of 1.9 percent, largely from acquisitions.

·                  Positive local-currency growth in oral care and medical supplies businesses.

·                  Local-currency sales declined in drug delivery.

·                  Geographically, Latin America posted double-digit local-currency sales growth.

·                  Operating income declined slightly to $311 million, with margins of 31.2 percent.

 

Consumer and Office

 

·                  Sales of $795 million, down 7.1 percent, mainly due to foreign currency translation.

·                  Local-currency sales were flat, including a 2.9 percent benefit from acquisitions.

·                  Positive local-currency sales growth in do-it-yourself and stationery products businesses.

·                  Regionally, Latin America, Canada and U.S. delivered positive local-currency sales growth.

·                  Profits down slightly to $167 million, with operating margins of 21.1 percent.

 

Safety, Security and Protection Services

 

·                  Sales of $694 million, down 15.4 percent.

·                  Sales growth in local currency down 3.6 percent, including positive growth of 10.6 percent from acquisitions, primarily Aearo Technologies, Inc.

·                  The 2008 divestiture of HighJump Software, Inc. hurt sales growth by 2.2 percent.

·                  Foreign currency translation decreased sales by 9.6 percent.

·                  Global industrial manufacturing slowdown hurt organic sales in personal safety products.

·                  Sales declined in all major geographies.

·                  Profits down 34 percent to $129 million, with operating margins of 18.6 percent.

 

Display and Graphics

 

·                  Sales declined 30.2 percent to $611 million, with local-currency sales down 26.6 percent.

·                  Foreign currency translation reduced sales by 3.6 percent.

·                  Local-currency sales were flat in traffic safety systems.

·                  Optical systems’ sales declined 44 percent year-on-year, which negatively impacted Display and Graphics’ total sales growth by nearly 12 percent.

·                  Double-digit decline in commercial graphics sales as customers reduced advertising spend.

 



 

·                  Operating profits were $66 million, with a 10.9 percent margin.

 

Electro and Communications

 

·                  Sales declined 34.8 percent to $480 million, including a 5.0 point penalty from foreign currency translation.

·                  Local-currency sales down 29.8 percent due to significant double-digit market declines in many served markets—electronics, semiconductor, telecommunications and appliance.

·                  Operating profits down 84 percent to $24 million.

 

George W. Buckley and Patrick D. Campbell, senior vice president and chief financial officer, will conduct an investor teleconference at 9 a.m. Eastern Time (8 a.m. Central Time) today. Investors can access a Webcast of this conference, along with related charts and materials, at http://investor.3M.com.

 

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; (2) the Company’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 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; and (9) legal proceedings, including significant developments that could occur in the legal and regulatory proceedings described in the company’s Annual Report on Form 10-K for the year ended December 31, 2008 (the “Report”). Changes in such assumptions or factors could produce significantly different results. A further description of these factors is located in the Report under “Risk Factors” in Part I, Item 1A. The information contained in this news release is as of the date indicated. The company 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.

 

About 3M

 

A recognized leader in research and development, 3M produces thousands of innovative products for dozens of diverse markets. 3M’s core strength is applying its more than 40 distinct technology platforms — often in combination — to a wide array of customer needs. With $25 billion in sales, 3M employs 76,000 people worldwide and has operations in more than 60 countries.

 



 

3M Company and Subsidiaries

CONSOLIDATED STATEMENT OF INCOME

(Millions, except per-share amounts)

(Unaudited)

 

 

 

Three-months ended

 

 

 

March 31

 

 

 

2009

 

2008

 

Net sales

 

$

5,089

 

$

6,463

 

Operating expenses

 

 

 

 

 

Cost of sales

 

2,772

 

3,336

 

Selling, general and administrative expenses

 

1,191

 

1,275

 

Research, development and related expenses

 

323

 

351

 

Total operating expenses

 

4,286

 

4,962

 

Operating income

 

803

 

1,501

 

Interest expense and income

 

 

 

 

 

Interest expense

 

55

 

55

 

Interest income

 

(11

)

(30

)

Total interest expense (income)

 

44

 

25

 

Income before income taxes

 

759

 

1,476

 

Provision for income taxes

 

229

 

470

 

Net income including noncontrolling interest

 

530

 

1,006

 

Less: Net income attributable to the noncontrolling interest

 

12

 

18

 

Net income attributable to 3M (a)

 

$

518

 

$

988

 

Weighted average 3M common shares outstanding — basic

 

693.5

 

706.5

 

Earnings per share attributable to 3M common shareholders — basic

 

$

0.75

 

$

1.40

 

Weighted average 3M common shares outstanding — diluted

 

695.9

 

717.2

 

Earnings per share attributable to 3M common shareholders — diluted (a)

 

$

0.74

 

$

1.38

 

Cash dividends paid per 3M common share

 

$

0.51

 

$

0.50

 

 



 


(a)          3M adopted SFAS No. 160, “Noncontrolling Interest in Consolidated Financial Statements,” effective January 1, 2009, which, among other things, changed the presentation format and certain captions of the consolidated income statement and consolidated balance sheet. 3M uses the captions recommended by this standard in its consolidated financial statements such as “net income attributable to 3M” and “earnings per share attributable to 3M common shareholders—diluted.” However, in the preceding release 3M has shortened this language to “net income” and “earnings per share” (or a slight variation thereof), respectively.

 



 

3M Company and Subsidiaries

SUPPLEMENTAL CONSOLIDATED STATEMENT OF INCOME INFORMATION

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(Millions, except per-share amounts)

(Unaudited)

 

In addition to reporting financial results in accordance with U.S. generally accepted accounting principles (GAAP), the company also discusses non-GAAP measures that exclude special items. Operating income, net income attributable to 3M (hereafter referred to as “net income”), and diluted earnings per share attributable to 3M common shareholders (hereafter referred to as “diluted earnings per share”) are all measures for which 3M provides the reported GAAP measure and an adjusted measure (excluding special items). Special items are not in accordance with, nor are they a substitute for, GAAP measures. Special items represent significant charges or credits that are important to an understanding of the company’s ongoing operations. The company uses these non-GAAP measures to evaluate and manage the company’s operations. The company believes that discussion of results excluding special items provides a useful analysis of ongoing operating trends. The determination of special items may not be comparable to similarly titled measures used by other companies.

 

The reconciliation provided below reconciles the non-GAAP financial measures with the most directly comparable GAAP financial measures for the three months ended March 31, 2009.

 

 

 

Three-months ended

 

 

 

Mar. 31, 2009

 

 

 

 

 

 

 

Diluted

 

 

 

 

 

 

 

earnings

 

 

 

Operating

 

Net

 

per

 

 

 

income

 

income

 

share

 

Reported GAAP measure

 

$

803

 

$

518

 

$

0.74

 

 

 

 

 

 

 

 

 

Special items:

 

 

 

 

 

 

 

Restructuring actions (b)

 

67

 

45

 

0.07

 

Adjusted Non-GAAP measure

 

$

870

 

$

563

 

$

0.81

 


(b)         During the first quarter of 2009, management approved and committed to undertake certain restructuring actions, which resulted in a pre-tax charge of $67 million. This charge related to employee-related liabilities for severance and benefits of approximately $61 million and fixed asset impairments of approximately $6 million. All business segments were impacted by these actions.

 

The reconciliation provided below reconciles the non-GAAP operating income measure by business segment with the most directly comparable GAAP financial measure for the three-months ended March 31, 2009. As discussed in more detail later in the section entitled “Business Segments,” 3M made certain changes to its business segments in the first quarter of 2009. Segment information for all periods presented has been reclassified to reflect these changes.

 

 



 

 

 

Three-months ended

 

 

 

Mar. 31, 2009

 

 

 

Reported

 

 

 

Adjusted

 

 

 

GAAP

 

Special

 

Non-GAAP

 

OPERATING INCOME BY BUSINESS SEGMENT

 

measure

 

items

 

measure

 

Industrial and Transportation

 

$

174

 

$

23

 

$

197

 

Health Care

 

307

 

4

 

311

 

Consumer and Office

 

165

 

2

 

167

 

Safety, Security and Protection Services

 

125

 

4

 

129

 

Display and Graphics

 

60

 

6

 

66

 

Electro and Communications

 

21

 

3

 

24

 

Corporate and Unallocated

 

(33

)

25

 

(8

)

Elimination of Dual Credit

 

(16

)

 

(16

)

Total Operating Income

 

$

803

 

$

67

 

$

870

 

 



 

3M Company and Subsidiaries

CONDENSED CONSOLIDATED BALANCE SHEET (c)

(Dollars in millions)

(Unaudited)

 

 

 

Mar. 31,

 

Dec. 31,

 

Mar. 31,

 

 

 

2009

 

2008

 

2008

 

ASSETS

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

1,632

 

$

1,849

 

$

2,727

 

Marketable securities

 

247

 

373

 

567

 

Accounts receivable — net

 

3,099

 

3,195

 

3,776

 

Inventories

 

2,660

 

3,013

 

3,021

 

Other current assets

 

1,009

 

1,168

 

1,234

 

Total current assets

 

8,647

 

9,598

 

11,325

 

Marketable securities — non-current

 

253

 

352

 

660

 

Investments

 

105

 

111

 

138

 

Property, plant and equipment — net

 

6,744

 

6,886

 

6,775

 

Prepaid pension benefits (d)

 

38

 

36

 

1,416

 

Goodwill, intangible assets and other assets (d)

 

8,585

 

8,810

 

6,662

 

Total assets

 

$

24,372

 

$

25,793

 

$

26,976

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

Short-term borrowings and current portion of long-term debt

 

$

946

 

$

1,552

 

$

2,042

 

Accounts payable

 

1,124

 

1,301

 

1,557

 

Accrued payroll

 

564

 

644

 

595

 

Accrued income taxes

 

314

 

350

 

710

 

Other current liabilities

 

1,780

 

1,992

 

1,796

 

Total current liabilities

 

4,728

 

5,839

 

6,700

 

Long-term debt

 

5,088

 

5,166

 

4,140

 

Pension and postretirement benefits (d)

 

2,901

 

2,847

 

1,349

 

Other liabilities

 

1,570

 

1,637

 

1,995

 

Total liabilities

 

14,287

 

15,489

 

14,184

 

Total stockholders’ equity — net (d)

 

10,085

 

10,304

 

12,792

 

Shares outstanding

 

 

 

 

 

 

 

March 31, 2009: 694,383,904 shares

 

 

 

 

 

 

 

December 31, 2008: 693,543,287 shares

 

 

 

 

 

 

 

March 31, 2008: 704,287,501 shares

 

 

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

24,372

 

$

25,793

 

$

26,976

 

 


 


(c)          Certain amounts in the prior years’ Consolidated Balance Sheet have been reclassified to conform to the current year presentation. As discussed in Note 1 in 3M’s 2008 Annual Report on Form 10-K, 3M adopted SFAS No. 160 and FSP No. APB 14-1 effective January 1, 2009. These accounting pronouncements related to noncontrolling interest and convertible debt instruments, respectively, which both required retrospective application. In addition, 3M reclassified balance sheet amounts related to life insurance policies from investments to other assets and also reclassified current and non-current balance sheet amounts related to income taxes between deferred income taxes and accrued income taxes.

 

(d)         When comparing March 31, 2009 and December 31, 2008 to March 31, 2008 balance sheet amounts, the changes in 3M’s defined benefit pension and postretirement plans’ funded status, which is required to be measured as of each year-end, significantly impacted several balance sheet lines. This required annual measurement at December 31, 2008 decreased prepaid pension benefits’ assets by $1.7 billion, increased deferred taxes within other assets by $1.1 billion, increased non-funded pension and postretirement benefits’ long-term liabilities by $1.7 billion and decreased stockholders’ equity by $2.3 billion. Other pension and postretirement changes, such as contributions and amortization, also impacted these balance sheet captions. In addition, goodwill and intangible assets increased due to acquisition activity when compared to March 31, 2008 balances.

 

 



 

3M Company and Subsidiaries

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(Dollars in millions)

(Unaudited)

 

 

 

Three-months ended

 

 

 

Mar. 31

 

 

 

2009

 

2008

 

SUMMARY OF CASH FLOW:

 

 

 

 

 

 

 

 

 

 

 

NET CASH PROVIDED BY OPERATING ACTIVITIES

 

$

695

 

$

997

 

Cash flows from investing activities:

 

 

 

 

 

Purchases of property, plant and equipment

 

(244

)

(298

)

Acquisitions, net of cash acquired

 

(9

)

(16

)

Other investing activities

 

235

 

(150

)

NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES

 

(18

)

(464

)

Cash flows from financing activities:

 

 

 

 

 

Change in debt

 

(598

)

1,122

 

Purchases of treasury stock

 

 

(510

)

Reissuances of treasury stock

 

34

 

79

 

Dividends paid to stockholders

 

(354

)

(353

)

Other financing activities

 

11

 

(23

)

NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES

 

(907

)

315

 

Effect of exchange rate changes on cash

 

13

 

(17

)

Net increase (decrease) in cash and cash equivalents

 

(217

)

831

 

Cash and cash equivalents at beginning of period

 

1,849

 

1,896

 

Cash and cash equivalents at end of period

 

$

1,632

 

$

2,727

 

 

 


 


 

3M Company and Subsidiaries

SUPPLEMENTAL CASH FLOW AND

OTHER SUPPLEMENTAL FINANCIAL INFORMATION

(Dollars in millions)

(Unaudited)

 

 

 

Three-months ended

 

 

 

Mar. 31

 

 

 

2009

 

2008

 

NON-GAAP MEASURES

 

 

 

 

 

 

 

 

 

 

 

Free Cash Flow:

 

 

 

 

 

Net cash provided by operating activities

 

$

695

 

$

997

 

Purchases of property, plant and equipment

 

(244

)

(298

)

Free Cash Flow (e)

 

$

451

 

$

699

 


(e)          Free cash flow is not defined under U.S. generally accepted accounting principles (GAAP). Therefore, it should not be considered a substitute for income or cash flow data prepared in accordance with U.S. GAAP and may not be comparable to similarly titled measures used by other companies. The company defines free cash flow as net cash provided by operating activities less purchases of property, plant and equipment. It should not be inferred that the entire free cash flow amount is available for discretionary expenditures. The company believes free cash flow is a useful measure of performance and uses this measure as an indication of the strength of the company and its ability to generate cash.

 

 

 

Mar. 31

 

 

 

2009

 

2008

 

OTHER NON-GAAP MEASURES:

 

 

 

 

 

Net Working Capital Turns (f)

 

4.4

 

4.9

 


(f)            The company uses various working capital measures that place emphasis and focus on certain working capital assets and liabilities. 3M’s net working capital index is defined as quarterly net sales multiplied by four, divided by ending net accounts receivable plus inventory less accounts payable. This measure is not recognized under U.S. generally accepted accounting principles and may not be comparable to similarly titled measures used by other companies.

 

 



 

3M Company and Subsidiaries

SALES CHANGE ANALYSIS

(Unaudited)

 

 

 

Three-Months Ended Mar. 31, 2009

 

 

 

 

 

 

 

 

 

Latin

 

 

 

 

 

United

 

 

 

Asia-

 

America/

 

World-

 

Sales Change Analysis By Geographic Area

 

States

 

Europe

 

Pacific

 

Canada

 

wide

 

Volume — organic

 

(19.6

)%

(16.7

)%

(24.1

)%

(14.4

)%

(19.5

)%

Price

 

3.5

 

1.9

 

(1.5

)

8.7

 

2.2

 

Organic local-currency sales

 

(16.1

)

(14.8

)

(25.6

)

(5.7

)

(17.3

)

Acquisitions

 

4.6

 

4.5

 

0.8

 

2.9

 

3.4

 

Local-currency sales

 

(11.5

)

(10.3

)

(24.8

)

(2.8

)

(13.9

)

 

 

 

 

 

 

 

 

 

 

 

 

Divestitures

 

(0.7

)

(0.1

)

 

(0.1

)

(0.3

)

Translation

 

 

(15.4

)

(3.6

)

(17.5

)

(7.1

)

Total sales change

 

(12.2

)%

(25.8

)%

(28.4

)%

(20.4

)%

(21.3

)%

 

 

 

Three-Months Ended Mar. 31, 2009

 

 

 

Organic

 

 

 

 

 

 

 

 

 

 

 

Worldwide

 

local-

 

 

 

Local-

 

 

 

 

 

Total

 

Sales Change Analysis

 

currency

 

Acqui-

 

`currency

 

Divest-

 

Trans-

 

sales

 

By Business Segment

 

sales

 

sitions

 

sales

 

itures

 

lation

 

change

 

Industrial and Transportation

 

(23.5

)%

2.8

%

(20.7

)%

%

(6.8

)%

(27.5

)%

Health Care

 

(0.1

)%

2.0

%

1.9

%

%

(9.6

)%

(7.7

)%

Consumer and Office

 

(3.0

)%

2.9

%

(0.1

)%

%

(7.0

)%

(7.1

)%

Safety, Security and Protection Services

 

(14.2

)%

10.6

%

(3.6

)%

(2.2

)%

(9.6

)%

(15.4

)%

Display and Graphics

 

(28.8

)%

2.2

%

(26.6

)%

%

(3.6

)%

(30.2

)%

Electro and Communications

 

(30.4

)%

0.6

%

(29.8

)%

%

(5.0

)%

(34.8

)%

 

 



 

3M Company and Subsidiaries

BUSINESS SEGMENTS

(Dollars in millions)

(Unaudited)

 

Effective in the first quarter of 2009, 3M made certain product moves between its business segments in its continuing effort to drive growth by aligning businesses around markets and customers. There were no changes related to product moves for the Health Care segment, Display and Graphics segment or Electro and Communications segment, or 3M in total. The product moves between business segments are summarized as follows:

 

·                  Certain 3M window films, such as 3M™ Scotchtint™ Window Film for buildings and 3M™ Ultra Safety and Security Window Film for property and personal protection during destructive weather conditions, were previously part of the Building and Commercial Services Division within the Safety, Security and Protection Services business segment. These window films were transferred to the newly created Renewable Energy Division, which is part of the Industrial and Transportation business segment. The Renewable Energy Division consists of current 3M solar energy creation and management products and solutions, as well as products focused on the renewable energy markets. Renewable Energy’s portfolio includes various 3M products for solar energy production and solar energy management (such as window films) and also includes responsibility for wind, geothermal and biofuel oriented products. The preceding product moves resulted in an increase in net sales for total year 2008 of $152 million for Industrial and Transportation, which was offset by a corresponding decrease in net sales for Safety, Security and Protection Services.

 

·                  3M acquired Aearo Holding Corp., the parent company of Aearo Technologies Inc. (hereafter referred to as Aearo), in April 2008. Aearo manufactures and sells personal protection and energy absorbing products through both the Industrial and Consumer retail channels. The consumer retail portion of Aearo’s business manufactures and markets personal safety products, including safety glasses and hearing protectors, among other products, to the do-it-yourself consumer retail markets. The do-it-yourself retail market portion of 3M’s Aearo business (previously in the Occupational Health and Environmental Safety Division within the Safety, Security and Protection Services business segment) was transferred to the Construction and Home Improvement Division within the Consumer and Office business segment. The preceding product moves resulted in an increase in net sales for total year 2008 of $49 million for Consumer and Office, which was offset by a corresponding decrease in net sales for Safety, Security and Protection Services.

 

Also, during the first quarter of 2009, 3M changed its segment reporting measures to include dual credit to business segments for certain U.S. sales and related operating income. Management now evaluates each of its six operating business segments based on net sales and operating income performance, including dual credit U.S. reporting. This change was made to further incentivize U.S. sales growth. As a result, 3M now provides additional (“dual”) credit to those business segments selling products in the U.S. to an external customer when that segment is not the primary seller of the product. For example, certain respirators are primarily sold by the Occupational Health and Environmental Safety Division within the Safety, Security and Protection Services business segment; however, the Industrial and Transportation business segment also sells this product to certain customers in its U.S. markets. In this example, the non-primary selling segment (Industrial

 

 



 

and Transportation) would also receive credit for the associated net sales it initiated and the related approximate operating income. The assigned operating income related to dual credit activity may differ from operating income that would result from actual costs associated with such sales. The offset to the dual credit business segment reporting is reflected as a reconciling item entitled “Elimination of Dual Credit,” such that sales and operating income for the U.S. in total are unchanged.  Segment information for all periods presented has been reclassified to reflect this new segment structure.

 

 

 

Three-months ended

 

BUSINESS SEGMENT INFORMATION

 

Mar. 31

 

(Millions)

 

2009

 

2008

 

NET SALES

 

 

 

 

 

Industrial and Transportation

 

$

1,581

 

$

2,182

 

Health Care

 

997

 

1,080

 

Consumer and Office

 

795

 

855

 

Safety, Security and Protection Services

 

694

 

821

 

Display and Graphics

 

611

 

875

 

Electro and Communications

 

480

 

735

 

Corporate and Unallocated

 

4

 

6

 

Elimination of Dual Credit

 

(73

)

(91

)

Total Company

 

$

5,089

 

$

6,463

 

OPERATING INCOME

 

 

 

 

 

Industrial and Transportation

 

$

174

 

$

492

 

Health Care

 

307

 

322

 

Consumer and Office

 

165

 

170

 

Safety, Security and Protection Services

 

125

 

196

 

Display and Graphics

 

60

 

188

 

Electro and Communications

 

21

 

149

 

Corporate and Unallocated

 

(33

)

4

 

Elimination of Dual Credit

 

(16

)

(20

)

Total Company

 

$

803

 

$

1,501

 

 

For the three-months ended March 31, 2009, refer to the preceding note (b) and the preceding reconciliation of operating income by business segment for a discussion and summary of items that impacted reported business segment operating income. 3M had no special items for the three months ended March 31, 2008.

 

 



 

Investor Contacts:

 

Matt Ginter

 

Media Contact:

 

Jacqueline Berry

 

 

3M

 

 

 

3M

 

 

(651) 733-8206

 

 

 

(651) 733-3611

 

 

 

 

 

 

 

 

 

Bruce Jermeland

 

 

 

 

 

 

3M

 

 

 

 

 

 

(651) 733-1807

 

 

 

 

 

From:

3M Public Relations and Corporate Communications

3M Center, Building 225-1S-15

St. Paul, MN 55144-1000