EXHIBIT 99

 

This Current Report on Form 8-K includes supplemental unaudited historical business segment net sales and operating income information that reflects a product line reporting change involving two of its business segments (provided on an annual and quarterly basis for the years ended December 31, 2015, 2014 and 2013). The Company did not operate under this structure for any of these prior periods and will begin to report comparative results under the new structure with the filing of its Quarterly Report on Form 10-Q for the quarter ending March 31, 2016.

 

Effective in the first quarter of 2016, 3M changed its business segment reporting in its continuing effort to improve the alignment of its businesses around markets and customers.

 

The change between business segments was as follows:

·

Elements of the electronic bonding product lines were previously separately reflected in the Electronics Materials Solutions Division (Electronics and Energy business segment) and the Industrial Adhesives and Tapes Division (Industrial business segment). Effective in the first quarter of 2016, certain sales and operating income results for these electronic bonding product lines in aggregate were equally divided between the Electronics and Energy business segment and Industrial business segment. This change resulted in a decrease in net sales for total year 2015 of $33 million in the Industrial business segment offset by a corresponding increase in the Electronics and Energy business segment.

 

The financial information presented herein reflects the impact of the preceding changes for all periods presented. The impact of this change on previously reported 2015 business segment net sales and operating income is summarized as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Sales

 

Operating Income

 

Year ended December 31, 2015

 

Previously

 

 

 

 

 

Previously

 

 

 

 

 

(Millions)

    

Reported

    

Revised

    

Change

    

Reported

    

Revised

    

Change

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Industrial

 

$

10,328

 

$

10,295

 

$

(33)

 

$

2,263

 

$

2,256

 

$

(7)

 

Safety and Graphics

 

 

5,515

 

 

5,515

 

 

 —

 

 

1,305

 

 

1,305

 

 

 —

 

Health Care

 

 

5,420

 

 

5,420

 

 

 —

 

 

1,724

 

 

1,724

 

 

 —

 

Electronics and Energy

 

 

5,220

 

 

5,253

 

 

33

 

 

1,102

 

 

1,109

 

 

7

 

Consumer

 

 

4,422

 

 

4,422

 

 

 —

 

 

1,046

 

 

1,046

 

 

 —

 

Corporate and Unallocated

 

 

1

 

 

1

 

 

 —

 

 

(355)

 

 

(355)

 

 

 —

 

Elimination of Dual Credit

 

 

(632)

 

 

(632)

 

 

 —

 

 

(139)

 

 

(139)

 

 

 —

 

Total Company

 

$

30,274

 

$

30,274

 

$

 —

 

$

6,946

 

$

6,946

 

$

 —

 

 

3M’s businesses are organized, managed and internally grouped into segments based on differences in markets, products, technologies and services. 3M manages its operations in five business segments: Industrial; Safety and Graphics; Health Care; Electronics and Energy; and Consumer. 3M’s five business segments bring together common or related 3M technologies, enhancing the development of innovative products and services and providing for efficient sharing of business resources. Transactions among reportable segments are recorded at cost. 3M is an integrated enterprise characterized by substantial intersegment cooperation, cost allocations and inventory transfers. Therefore, management does not represent that these segments, if operated independently, would report the operating income information shown.

 

Corporate and unallocated operating income includes a variety of miscellaneous items, such as corporate investment gains and losses, certain derivative gains and losses, certain insurance-related gains and losses, certain litigation and environmental expenses, corporate restructuring charges and certain under- or over-absorbed costs (e.g. pension, stock-based compensation) that the Company may choose not to allocate directly to its business segments. Because this category includes a variety of miscellaneous items, it is subject to fluctuation on a quarterly and annual basis.

 

3M business segment reporting measures include dual credit to business segments for certain U.S. sales and related operating income. Management evaluates each of its five business segments based on net sales and operating income performance, including dual credit U.S. reporting to further incentivize U.S. sales growth. As a result, 3M 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 Personal Safety Division within the Safety and Graphics business segment; however, the Industrial business segment also sells this product to certain customers in its U.S. markets. In this example, the non-primary selling segment (Industrial) 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. 


 

 

Supplemental Unaudited Business Segment Information

Based on Segment Structure Effective in the First Quarter of 2016

Net Sales 

   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Sales

 

First

 

Second

 

Third

 

Fourth

 

Total

 

(Millions)

    

Quarter

    

Quarter

    

Quarter

    

Quarter

    

Year

 

Industrial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

2,656

 

$

2,632

 

$

2,557

 

$

2,450

 

$

10,295

 

2014

 

 

2,778

 

 

2,814

 

 

2,770

 

 

2,623

 

 

10,985

 

2013

 

 

2,689

 

 

2,682

 

 

2,693

 

 

2,589

 

 

10,653

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Safety and Graphics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

1,372

 

$

1,432

 

$

1,417

 

$

1,294

 

$

5,515

 

2014

 

 

1,423

 

 

1,494

 

 

1,448

 

 

1,367

 

 

5,732

 

2013

 

 

1,399

 

 

1,434

 

 

1,429

 

 

1,322

 

 

5,584

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Health Care

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

1,329

 

$

1,364

 

$

1,346

 

$

1,381

 

$

5,420

 

2014

 

 

1,374

 

 

1,416

 

 

1,390

 

 

1,392

 

 

5,572

 

2013

 

 

1,311

 

 

1,336

 

 

1,328

 

 

1,359

 

 

5,334

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Electronics and Energy

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

1,324

 

$

1,312

 

$

1,397

 

$

1,220

 

$

5,253

 

2014

 

 

1,309

 

 

1,422

 

 

1,503

 

 

1,374

 

 

5,608

 

2013

 

 

1,281

 

 

1,340

 

 

1,450

 

 

1,326

 

 

5,397

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

1,048

 

$

1,111

 

$

1,162

 

$

1,101

 

$

4,422

 

2014

 

 

1,079

 

 

1,139

 

 

1,177

 

 

1,128

 

 

4,523

 

2013

 

 

1,081

 

 

1,098

 

 

1,153

 

 

1,103

 

 

4,435

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate and Unallocated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

2

 

$

(4)

 

$

1

 

$

2

 

$

1

 

2014

 

 

3

 

 

 —

 

 

2

 

 

 —

 

 

5

 

2013

 

 

2

 

 

2

 

 

1

 

 

3

 

 

8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Elimination of Dual Credit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

(153)

 

$

(161)

 

$

(168)

 

$

(150)

 

$

(632)

 

2014

 

 

(135)

 

 

(151)

 

 

(153)

 

 

(165)

 

 

(604)

 

2013

 

 

(129)

 

 

(140)

 

 

(138)

 

 

(133)

 

 

(540)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Company

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

7,578

 

$

7,686

 

$

7,712

 

$

7,298

 

$

30,274

 

2014

 

 

7,831

 

 

8,134

 

 

8,137

 

 

7,719

 

 

31,821

 

2013

 

 

7,634

 

 

7,752

 

 

7,916

 

 

7,569

 

 

30,871

 

 


 

 

Supplemental Unaudited Business Segment Information

Based on Segment Structure Effective in the First Quarter of 2016

Operating Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Income

 

First

 

Second

 

Third

 

Fourth

 

Total

 

(Millions)

    

Quarter

    

Quarter

    

Quarter

    

Quarter

    

Year

 

Industrial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

596

 

$

608

 

$

578

 

$

474

 

$

2,256

 

2014

 

 

616

 

 

615

 

 

614

 

 

536

 

 

2,381

 

2013

 

 

576

 

 

601

 

 

570

 

 

554

 

 

2,301

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Safety and Graphics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

335

 

$

364

 

$

324

 

$

282

 

$

1,305

 

2014

 

 

318

 

 

353

 

 

340

 

 

285

 

 

1,296

 

2013

 

 

332

 

 

328

 

 

313

 

 

254

 

 

1,227

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Health Care

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

408

 

$

440

 

$

432

 

$

444

 

$

1,724

 

2014

 

 

427

 

 

434

 

 

432

 

 

431

 

 

1,724

 

2013

 

 

404

 

 

417

 

 

426

 

 

425

 

 

1,672

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Electronics and Energy

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

285

 

$

278

 

$

344

 

$

202

 

$

1,109

 

2014

 

 

229

 

 

294

 

 

340

 

 

259

 

 

1,122

 

2013

 

 

199

 

 

239

 

 

301

 

 

222

 

 

961

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

240

 

$

259

 

$

293

 

$

254

 

$

1,046

 

2014

 

 

228

 

 

241

 

 

272

 

 

254

 

 

995

 

2013

 

 

237

 

 

235

 

 

247

 

 

226

 

 

945

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate and Unallocated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

(100)

 

$

(74)

 

$

(58)

 

$

(123)

 

$

(355)

 

2014

 

 

(72)

 

 

(48)

 

 

(63)

 

 

(67)

 

 

(250)

 

2013

 

 

(74)

 

 

(87)

 

 

(88)

 

 

(73)

 

 

(322)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Elimination of Dual Credit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

(34)

 

$

(35)

 

$

(37)

 

$

(33)

 

$

(139)

 

2014

 

 

(30)

 

 

(33)

 

 

(34)

 

 

(36)

 

 

(133)

 

2013

 

 

(28)

 

 

(31)

 

 

(30)

 

 

(29)

 

 

(118)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Company

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

$

1,730

 

$

1,840

 

$

1,876

 

$

1,500

 

$

6,946

 

2014

 

 

1,716

 

 

1,856

 

 

1,901

 

 

1,662

 

 

7,135

 

2013

 

 

1,646

 

 

1,702

 

 

1,739

 

 

1,579

 

 

6,666