3M’s Profit Climbs 7%, Just Shy Of Expectations
Maplewood-based 3M Company said Thursday that both its earnings and revenue increased during the first quarter, although the company fell just shy of analysts’ expectations in both categories.
Chairman, president, and CEO Inge Thulin called it a “solid quarter for 3M.” Sales climbed 2.6 percent to a first-quarter record of $7.8 billion, driven in part by success in the company’s health care business, whose revenue grew 4.8 percent to $1.4 billion. (In February, 3M announced plans to acquire Treo Solutions, a New York-based provider of analytics and other data to the health care industry.)
Sales in the company’s industrial business, its largest segment, grew about 3 percent to $2.8 billion, while its consumer-products sales slid 0.2 percent to $1.1 billion. Total quarterly revenue fell just short of the $7.96 billion that analysts polled by Thomson Reuters had expected.
Earnings, meanwhile, totaled $1.2 billion, or $1.79 per share, up about 7 percent from $1.1 billion, or $1.61 per share, during last year’s first quarter. The company said, however, that currency translations had a negative impact on sales, and operating expenses rose about 2 percent to $6.1 billion. Profits just missed analysts’ expectations of $1.80 per share.
“Our teams delivered positive organic growth in all business groups and geographic areas, we posted strong margins across the portfolio, and we returned a record amount of cash to shareholders,” Thulin said in a statement. “At the same time we increased investments in R&D and commercialization to help secure future growth in the business. 3M is well-positioned to generate sustainable, profitable growth far into the future.”
The company reaffirmed its full-year earnings outlook of $7.30 to $7.55 per share, and it has reportedly also indicated that it's open to the possibility of acquisitions costing more than $1 billion; its previous acquisitions have typically been below $1 billion. 3M's stock was trading down about 1.1 percent at $136.50 late Thursday morning.
3M makes everything from its iconic Post-it notes to patient-monitoring tools. It employs 89,000 people worldwide and has operations in more than 70 countries, and it’s often cited as a leader in innovation. Recently, the company began touting a new immersion cooling technology that it says will be “revolutionary” for large-scale data center hubs.