Exhibit 99

 

For Immediate Release

 

3M Delivers Second-Quarter Sales of $7.8 Billion and Earnings of $2.58 per Share;

Company Updates its 2017 Outlook

 

Second-Quarter Highlights:

·                  Sales of $7.8 billion, up 1.9 percent; organic local-currency growth of 3.5 percent with positive growth across all five business groups

·                  GAAP EPS of $2.58, up 24.0 percent year-on-year; includes $0.33 benefit from divestiture gains net of strategic investments

·                  Returned $1.2 billion to shareholders via dividends and gross share repurchases

·                  Updated 2017 full-year outlook: GAAP EPS of $8.80 to $9.05 versus $8.70 to $9.05, previously

 

ST. PAUL, Minn. — July 25, 2017 - 3M (NYSE: MMM) today reported second-quarter earnings of $2.58 per share, an increase of 24.0 percent versus the second quarter of 2016. Sales were $7.8 billion, up 1.9 percent year-on-year in dollar terms. Organic local-currency sales increased 3.5 percent while divestitures reduced sales by 1.0 percent. Foreign currency translation decreased sales by 0.6 percent year-on-year.

 

Operating income was $2.2 billion and operating income margin for the quarter was 28.0 percent, up 3.6 percentage points year-on-year. This result includes a net benefit of $273 million, which is comprised of divestiture gains of $451 million (net of lost operating income), partially offset by $178 million of incremental investments in accelerated growth programs, productivity and portfolio actions. Second-quarter net income was $1.6 billion, up 22.6 percent. The company’s operating cash flow was $1.6 billion, contributing to conversion of 85 percent of net income to free cash flow, as referenced in the “Supplemental Financial Information Non-GAAP Measures” section.

 

3M paid $701 million in cash dividends to shareholders and repurchased $494 million of its own shares during the quarter.

 

Total sales grew 7.5 percent in Electronics and Energy, 2.5 percent in Industrial, 1.8 percent in Health Care, and 0.5 percent in Consumer; total sales declined 0.9 percent in Safety and Graphics. Organic local-currency sales increased 8.4 percent in Electronics and Energy, 3.8 percent in Industrial, 3.2 percent in Safety and Graphics, 2.5 percent in Health Care, and 0.7 percent in Consumer.

 

On a geographic basis, total sales grew 8.3 percent in Asia Pacific, 2.5 percent in Latin America/Canada, and 0.5 percent in the U.S.; total sales declined 3.6 percent in EMEA (Europe, Middle East and Africa). Organic local-currency sales increased 10.0 percent in Asia Pacific, 3.7 percent in Latin America/Canada, and 1.9 percent in the U.S.; organic local-currency sales declined 1.6 percent in EMEA.

 



 

“Our team posted another quarter of strong and broad-based organic growth, which included positive growth across all five of our business groups,” said Inge G. Thulin, 3M chairman, president and chief executive officer. “We also continued to deliver premium margins and returns, while accelerating investments to support growth and strengthen the portfolio — which is part of our playbook to build an even stronger and more competitive 3M.”

 

Coming off a strong first half of the year, 3M updated its guidance for 2017. The company now forecasts organic local-currency sales growth to be 3 to 5 percent, up from previous guidance of 2 to 5 percent. 3M expects earnings in the range of $8.80 to $9.05 per share — up 8 to 11 percent year-on-year — versus a prior expectation of $8.70 to $9.05.

 

Second-Quarter Business Group Discussion

 

Industrial

 

·                  Sales of $2.7 billion, up 2.5 percent in U.S. dollars. Organic local-currency sales increased 3.8 percent, foreign currency translation reduced sales by 0.7 percent and divestitures reduced sales by an additional 0.6 percent.

·                  On an organic local-currency basis:

·                  Sales growth led by advanced materials, automotive and aerospace solutions, and industrial adhesives and tapes; separation and purification sciences declined.

·                  Sales grew in all geographic areas led by Asia Pacific and the U.S.

·                  Operating income was $523 million, a decrease of 15.6 percent year-on-year; operating margin of 19.2 percent.

 

Safety and Graphics

 

·                  Sales of $1.5 billion, down 0.9 percent in U.S. dollars. Organic local-currency sales increased 3.2 percent, while foreign currency translation reduced sales by 0.7 percent and divestitures decreased sales by 3.4 percent.

·                  On an organic local-currency basis:

·                  Sales increased in personal safety, were flat in commercial solutions, and declined in transportation safety and roofing granules.

·                  Sales grew in all geographic areas led by Asia Pacific and Latin America/Canada.

·                  Operating income was $852 million, up 102.0 percent year-on-year, reflecting divestiture gains of $451 million (net of lost operating income); operating margin of 55.1 percent.

 

Health Care

 

·                  Sales of $1.4 billion, up 1.8 percent in U.S. dollars. Organic local-currency sales increased 2.5 percent and foreign currency translation reduced sales by 0.7 percent.

·                  On an organic local-currency basis:

·                  Sales grew in drug delivery systems, food safety, and medical consumables; oral care was flat.

·                  Sales increased in Latin America/Canada, Asia Pacific, and the U.S.; declined in EMEA.

·                  Operating income was $412 million, a decrease of 10.6 percent year-on-year; operating margin of 28.6 percent.

 



 

Electronics and Energy

 

·                  Sales of $1.2 billion, up 7.5 percent in U.S. dollars. Organic local-currency sales increased 8.4 percent, foreign currency translation reduced sales by 0.5 percent and divestitures decreased sales by 0.4 percent.

·                  On an organic local-currency basis:

·                  Electronics-related sales were up 15 percent with growth in both electronics materials solutions, and display materials and systems; energy-related sales declined 3 percent, with electrical markets flat, while telecom declined.

·                  Sales grew in Asia Pacific and Latin America/Canada; U.S. was flat; EMEA declined.

·                  Operating income was $301 million, an increase of 38.8 percent year-on-year; operating margin of 24.8 percent.

 

Consumer

 

·                  Sales of $1.1 billion, up 0.5 percent in U.S. dollars. Organic local-currency sales increased 0.7 percent and foreign currency translation decreased sales by 0.2 percent.

·                  On an organic local-currency basis:

·                  Sales grew in home improvement, home care and consumer health care; stationery and office declined.

·                  Sales grew in Asia Pacific and Latin America/Canada; declined in the U.S. and EMEA.

·                  Operating income was $195 million, down 30.4 percent year-on-year; operating margin of 17.2 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://investors.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://investors.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., the access code is 21841623). The telephone replay will be available until 11:30 a.m. EDT (10:30 a.m. CDT) on July 30, 2017.

 

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,” “aim,” “project,” “intend,” “plan,” “believe,” “will,” “should,” “could,” “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, political, and capital markets conditions and other factors beyond the Company’s control, including natural and other disasters or climate change affecting the

 



 

operations of the Company or its customers and suppliers; (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 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 the Company’s information technology infrastructure; (10) financial market risks that may affect the Company’s funding obligations under defined benefit pension and postretirement plans; and (11) 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 Dec. 31, 2016, and any 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 Reports). 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.

 



 

3M Company and Subsidiaries

CONSOLIDATED STATEMENT OF INCOME

(Millions, except per-share amounts)

(Unaudited)

 

 

 

Three months ended 

 

Six months ended 

 

 

 

June 30,

 

June 30,

 

 

 

2017

 

2016

 

2017

 

2016

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

7,810

 

$

7,662

 

$

15,495

 

$

15,071

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

Cost of sales

 

4,007

 

3,799

 

7,876

 

7,477

 

Selling, general and administrative expenses

 

1,607

 

1,560

 

3,207

 

3,093

 

Research, development and related expenses

 

473

 

437

 

944

 

887

 

Gain on sale of businesses

 

(461

)

 

(490

)

(40

)

 

 

 

 

 

 

 

 

 

 

Total operating expenses

 

5,626

 

5,796

 

11,537

 

11,417

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

2,184

 

1,866

 

3,958

 

3,654

 

 

 

 

 

 

 

 

 

 

 

Interest expense and income

 

 

 

 

 

 

 

 

 

Interest expense

 

54

 

38

 

99

 

85

 

Interest income

 

(12

)

(7

)

(20

)

(12

)

 

 

 

 

 

 

 

 

 

 

Total interest expense — net

 

42

 

31

 

79

 

73

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

2,142

 

1,835

 

3,879

 

3,581

 

 

 

 

 

 

 

 

 

 

 

Provision for income taxes

 

557

 

542

 

968

 

1,010

 

 

 

 

 

 

 

 

 

 

 

Net income including noncontrolling interest

 

$

1,585

 

$

1,293

 

$

2,911

 

$

2,571

 

 

 

 

 

 

 

 

 

 

 

Less: Net income attributable to noncontrolling interest

 

2

 

2

 

5

 

5

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to 3M

 

$

1,583

 

$

1,291

 

$

2,906

 

$

2,566

 

 

 

 

 

 

 

 

 

 

 

Weighted average 3M common shares outstanding — basic

 

598.1

 

606.9

 

598.1

 

607.2

 

Earnings per share attributable to 3M common shareholders — basic

 

$

2.65

 

$

2.13

 

$

4.86

 

$

4.23

 

 

 

 

 

 

 

 

 

 

 

Weighted average 3M common shares outstanding — diluted

 

612.8

 

620.9

 

612.4

 

621.1

 

Earnings per share attributable to 3M common shareholders — diluted

 

$

2.58

 

$

2.08

 

$

4.74

 

$

4.13

 

 

 

 

 

 

 

 

 

 

 

Cash dividends paid per 3M common share

 

$

1.175

 

$

1.11

 

$

2.35

 

$

2.22

 

 



 

3M Company and Subsidiaries

CONDENSED CONSOLIDATED BALANCE SHEET

(Dollars in millions)

(Unaudited)

 

 

 

June 30,

 

December 31,

 

 

 

2017

 

2016

 

ASSETS

 

 

 

 

 

Current assets

 

 

 

 

 

Cash and cash equivalents

 

$

2,654

 

$

2,398

 

Marketable securities — current

 

140

 

280

 

Accounts receivable — net

 

4,919

 

4,392

 

Inventories

 

3,838

 

3,385

 

Other current assets

 

1,090

 

1,271

 

Total current assets

 

12,641

 

11,726

 

Marketable securities — non-current

 

17

 

17

 

Investments

 

137

 

128

 

Property, plant and equipment — net

 

8,566

 

8,516

 

Goodwill and intangible assets — net

 

11,306

 

11,486

 

Other assets

 

1,290

 

1,033

 

Total assets

 

$

33,957

 

$

32,906

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

Current liabilities

 

 

 

 

 

Short-term borrowings and

 

 

 

 

 

current portion of long-term debt

 

$

213

 

$

972

 

Accounts payable

 

1,782

 

1,798

 

Accrued payroll

 

666

 

678

 

Accrued income taxes

 

432

 

299

 

Other current liabilities

 

2,604

 

2,472

 

Total current liabilities

 

5,697

 

6,219

 

Long-term debt

 

11,088

 

10,678

 

Other liabilities

 

5,528

 

5,666

 

Total liabilities

 

$

22,313

 

$

22,563

 

 

 

 

 

 

 

Total equity

 

$

11,644

 

$

10,343

 

Shares outstanding

 

 

 

 

 

June 30, 2017: 596,767,147 shares

 

 

 

 

 

December 31, 2016: 596,726,278 shares

 

 

 

 

 

Total liabilities and equity

 

$

33,957

 

$

32,906

 

 



 

3M Company and Subsidiaries

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(Dollars in millions)

(Unaudited)

 

 

 

Six months ended 

 

 

 

June 30,

 

 

 

2017

 

2016

 

NET CASH PROVIDED BY OPERATING ACTIVITIES

 

$

2,630

 

$

2,545

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

Purchases of property, plant and equipment

 

(589

)

(637

)

Acquisitions, net of cash acquired

 

 

(4

)

Purchases and proceeds from sale or maturities of marketable securities and investments — net

 

136

 

(61

)

Proceeds from sale of businesses, net of cash sold

 

862

 

56

 

Other investing activities

 

18

 

16

 

 

 

 

 

 

 

NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES

 

427

 

(630

)

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

Change in debt

 

(763

)

775

 

Purchases of treasury stock

 

(1,184

)

(2,055

)

Proceeds from issuances of treasury stock pursuant to stock option and benefit plans

 

496

 

612

 

Dividends paid to shareholders

 

(1,403

)

(1,344

)

Other financing activities

 

(2

)

(16

)

 

 

 

 

 

 

NET CASH USED IN FINANCING ACTIVITIES

 

(2,856

)

(2,028

)

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

55

 

3

 

 

 

 

 

 

 

Net increase (decrease) in cash and cash equivalents

 

256

 

(110

)

Cash and cash equivalents at beginning of year

 

2,398

 

1,798

 

 

 

 

 

 

 

Cash and cash equivalents at end of period

 

$

2,654

 

$

1,688

 

 



 

3M Company and Subsidiaries

SUPPLEMENTAL FINANCIAL INFORMATION

NON-GAAP MEASURES

(Dollars in millions, except full-year 2017 forecast)

(Unaudited)

 

 

 

Three months ended 

 

Six months ended 

 

 

 

 

 

June 30,

 

June 30,

 

 

 

Major GAAP Cash Flow Categories

 

2017

 

2016

 

2017

 

2016

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash provided by operating activities

 

$

1,642

 

$

1,285

 

$

2,630

 

$

2,545

 

 

 

Net cash provided by (used in) investing activities

 

517

 

(350

)

427

 

(630

)

 

 

Net cash used in financing activities

 

(1,705

)

(602

)

(2,856

)

(2,028

)

 

 

 

Free Cash Flow (non-GAAP measure)

 

 

 

 

 

 

 

 

 

Full-Year
2017 Forecast
(Billions)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash provided by operating activities

 

$

1,642

 

$

1,285

 

$

2,630

 

$

2,545

 

$6.3 to $7.0

 

Purchases of property, plant and equipment

 

(302

)

(323

)

(589

)

(637

)

$1.3 to $1.5

 

Free cash flow (a)

 

1,340

 

962

 

2,041

 

1,908

 

$5.0 to $5.5

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to 3M

 

$

1,583

 

$

1,291

 

$

2,906

 

$

2,566

 

$5.3 to $5.5

 

Free cash flow conversion (a)

 

85

%

75

%

70

%

74

%

95% to 100%

 

 


(a)                                 Free cash flow and free cash flow conversion are not defined under U.S. generally accepted accounting principles (GAAP). Therefore, they 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 defines free cash flow conversion as free cash flow divided by net income attributable to 3M. The Company believes free cash flow and free cash flow conversion are meaningful to investors as they function as useful measures of performance and the Company uses these measures as an indication of the strength of the company and its ability to generate cash.

 

 

 

June 30,

 

December 31,

 

Net Debt (non-GAAP measure)

 

2017

 

2016

 

 

 

 

 

 

 

Total debt

 

$

11,301

 

$

11,650

 

Less: Cash and cash equivalents and marketable securities

 

2,811

 

2,695

 

 

 

 

 

 

 

Net debt (b)

 

$

8,490

 

$

8,955

 

 


(b)                                 Net debt is not defined under U.S. GAAP and may not be computed the same as similarly titled measures used by other companies. The Company defines net debt as total debt less the total of cash, cash equivalents and current and long-term marketable securities. 3M believes net debt is meaningful to investors as 3M considers net debt and its components to be an important indicator of liquidity and a guiding measure of capital structure strategy.

 



 

3M Company and Subsidiaries

SALES CHANGE ANALYSIS (c)

(Unaudited)

 

 

 

Three months ended June 30, 2017

 

 

 

 

 

 

 

Europe,

 

 

 

 

 

 

 

 

 

 

 

Middle

 

Latin

 

 

 

Sales Change Analysis

 

United

 

Asia-

 

East and

 

America/

 

World-

 

By Geographic Area

 

States

 

Pacific

 

Africa

 

Canada

 

Wide

 

 

 

 

 

 

 

 

 

 

 

 

 

Volume — organic

 

2.3

%

10.7

%

(2.0

)%

3.5

%

3.8

%

Price

 

(0.4

)

(0.7

)

0.4

 

0.2

 

(0.3

)

Organic local-currency sales

 

1.9

 

10.0

 

(1.6

)

3.7

 

3.5

 

Divestitures

 

(1.4

)

(0.4

)

(0.8

)

(1.3

)

(1.0

)

Translation

 

 

(1.3

)

(1.2

)

0.1

 

(0.6

)

Total sales change

 

0.5

%

8.3

%

(3.6

)%

2.5

%

1.9

%

 

 

 

Three months ended June 30, 2017

 

 

 

Organic

 

 

 

 

 

 

 

Worldwide

 

local-

 

 

 

 

 

Total

 

Sales Change Analysis

 

currency

 

 

 

 

 

sales

 

By Business Segment

 

sales

 

Divestitures

 

Translation

 

change

 

 

 

 

 

 

 

 

 

 

 

Industrial

 

3.8

%

(0.6

)%

(0.7

)%

2.5

%

Safety and Graphics

 

3.2

%

(3.4

)%

(0.7

)%

(0.9

)%

Health Care

 

2.5

%

%

(0.7

)%

1.8

%

Electronics and Energy

 

8.4

%

(0.4

)%

(0.5

)%

7.5

%

Consumer

 

0.7

%

%

(0.2

)%

0.5

%

Total Company

 

3.5

%

(1.0

)%

(0.6

)%

1.9

%

 

 

 

Six months ended June 30, 2017

 

 

 

 

 

 

 

Europe,

 

 

 

 

 

 

 

 

 

 

 

Middle

 

Latin

 

 

 

Sales Change Analysis

 

United

 

Asia-

 

East and

 

America/

 

World-

 

By Geographic Area

 

States

 

Pacific

 

Africa

 

Canada

 

Wide

 

 

 

 

 

 

 

 

 

 

 

 

 

Volume — organic

 

1.9

%

10.4

%

0.6

%

2.1

%

4.1

%

Price

 

(0.3

)

(0.4

)

0.4

 

1.0

 

(0.1

)

Organic local-currency sales

 

1.6

 

10.0

 

1.0

 

3.1

 

4.0

 

Divestitures

 

(1.1

)

(0.2

)

(0.4

)

(0.9

)

(0.7

)

Translation

 

 

(0.7

)

(2.5

)

2.1

 

(0.5

)

Total sales change

 

0.5

%

9.1

%

(1.9

)%

4.3

%

2.8

%

 

 

 

Six months ended June 30, 2017

 

 

 

Organic

 

 

 

 

 

 

 

Worldwide

 

local-

 

 

 

 

 

Total

 

Sales Change Analysis

 

currency

 

 

 

 

 

sales

 

By Business Segment

 

sales

 

Divestitures

 

Translation

 

change

 

 

 

 

 

 

 

 

 

 

 

Industrial

 

4.8

%

(0.7

)%

(0.7

)%

3.4

%

Safety and Graphics

 

4.0

%

(2.1

)%

(0.7

)%

1.2

%

Health Care

 

2.8

%

%

(0.7

)%

2.1

%

Electronics and Energy

 

10.0

%

(0.3

)%

(0.4

)%

9.3

%

Consumer

 

(0.3

)%

%

0.2

%

(0.1

)%

Total Company

 

4.0

%

(0.7

)%

(0.5

)%

2.8

%

 


(c)                                  Total sales change is calculated based on reported sales results. The components of sales change include organic local-currency sales, acquisitions, divestitures, and translation. Organic local-currency sales includes both organic volume impacts (which excludes acquisition and divestiture impacts), plus selling price changes. Acquisition and divestiture impacts are measured separately for the first 12 months post-transaction.

 



 

3M Company and Subsidiaries

BUSINESS SEGMENTS

(Dollars in millions)

(Unaudited)

 

Effective in the first quarter of 2017, as part of 3M’s continuing effort to improve the alignment of its businesses around markets and customers the Company made the following changes:

 

1.              Integrated the former Renewable Energy Division into existing divisions;

2.              Combined two divisions to form the Automotive and Aerospace Solutions Division; and

3.              Consolidated U.S. customer account activity - impacting dual credit reporting

 

Integration of former Renewable Energy Division

 

·                  The (a) solar and wind and (b) energy product lines (along with certain technology previously included in Corporate and Unallocated) of the former Renewable Energy Division (RED) were integrated into the existing Electrical Markets Division and Electronics Materials and Solutions Division, respectively, within the Electronics and Energy business segment. In addition, the former RED’s window film products were moved into the Commercial Solutions Division within the Safety and Graphics business segment. This change resulted in a decrease in previously reported net sales and operating income for total year 2016 of $203 million and $38 million, respectively, in the Electronics and Energy segment. These decreases were offset by a $207 million and $29 million increase in previously reported total year 2016 net sales and operating income, respectively, in the Safety and Graphics business segment and a $4 million decrease and $9 million increase in previously reported net sales and operating income, respectively, in Corporate and Unallocated.

 

Creation of Automotive and Aerospace Solutions Division

 

·                  The former Automotive Division and Aerospace and Commercial Transportation Division (both within the Industrial business segment) were combined to create the Automotive and Aerospace Solutions Division. Because this realignment was within the Industrial business segment, it had no impact on business segment reporting.

 

Consolidation of U.S. customer account activity - impacting dual credit reporting

 

·                  The Company consolidated its customer account activity in the U.S. into more centralized sales districts to better serve customers. As discussed further below, 3M business segment reporting measures include dual credit to business segments for certain U.S. sales and related operating income. This dual credit is based on which business segment provides customer account activity (“sales district”) with respect to a particular product sold in the U.S. Previously, a customer in the U.S. may have been aligned to several sales districts associated with multiple divisions or segments based on the individual products the customer purchased across 3M’s portfolio. The alignment of U.S. customer accounts to fewer, more focused sales districts therefore changed the attribution of dual credit across 3M’s business segments. As a result, previously reported aggregate business segment net sales and operating income for total year 2016 increased $163 million and $36 million, respectively, offset by similar increases in the elimination of dual credit net sales and operating income amounts.

 

The financial information presented herein reflects the impact of the preceding product line reporting change between business segments for all periods presented. Refer to 3M’s Current Report on Form 8-K furnished on March 9, 2017, for additional supplemental unaudited historical business segment net sales and operating income information. In addition, these business segment changes were reflected in 3M’s Current Report on Form 8-K dated May 4, 2017, (which updated 3M’s 2016 Annual Report on Form 10-K) and 3M’s Quarterly Report on Form 10-Q for the period ended March 31, 2017.

 



 

BUSINESS SEGMENT INFORMATION

 

Three months ended 

 

Six months ended 

 

NET SALES

 

June 30,

 

June 30,

 

(Millions)

 

2017

 

2016

 

2017

 

2016

 

 

 

 

 

 

 

 

 

 

 

Industrial

 

$

2,720

 

$

2,654

 

$

5,429

 

$

5,253

 

Safety and Graphics

 

1,547

 

1,561

 

3,074

 

3,038

 

Health Care

 

1,440

 

1,414

 

2,863

 

2,805

 

Electronics and Energy

 

1,214

 

1,129

 

2,424

 

2,218

 

Consumer

 

1,137

 

1,130

 

2,179

 

2,180

 

Corporate and Unallocated

 

2

 

3

 

4

 

3

 

Elimination of Dual Credit

 

(250

)

(229

)

(478

)

(426

)

 

 

 

 

 

 

 

 

 

 

Total Company

 

$

7,810

 

$

7,662

 

$

15,495

 

$

15,071

 

 

BUSINESS SEGMENT INFORMATION

 

Three months ended 

 

Six months ended 

 

OPERATING INCOME

 

June 30,

 

June 30,

 

(Millions)

 

2017

 

2016

 

2017

 

2016

 

 

 

 

 

 

 

 

 

 

 

Industrial

 

$

523

 

$

620

 

$

1,148

 

$

1,242

 

Safety and Graphics

 

852

 

421

 

1,251

 

780

 

Health Care

 

412

 

462

 

846

 

919

 

Electronics and Energy

 

301

 

217

 

526

 

412

 

Consumer

 

195

 

281

 

417

 

519

 

Corporate and Unallocated

 

(44

)

(84

)

(125

)

(124

)

Elimination of Dual Credit

 

(55

)

(51

)

(105

)

(94

)

 

 

 

 

 

 

 

 

 

 

Total Company

 

$

2,184

 

$

1,866

 

$

3,958

 

$

3,654

 

 



 

About 3M

 

At 3M, we apply science in collaborative ways to improve lives daily. With $30 billion in sales, our 90,000 employees connect with customers all around the world.

 

 

 

 

 

Investor Contact:

Bruce Jermeland

Media Contact:

Donna Fleming Runyon

 

3M

 

3M

 

(651) 733-1807

 

(651) 736-7646

 

From:

3M Public Relations and Corporate Communications

3M Center, Building 225-1S-15

St. Paul, MN 55144-1000