WSJ:
3M Earnings Jump 16%
By JAMES R. HAGERTY
3M Co. reported a 16% increase in first quarter profit and raised its earnings forecast for the full year as sales surged in India, China and Brazil.
The St. Paul, Minn.-based conglomerate cited strong sales of products used in the electronics and renewable-energy industries.
Demand for materials used in the screens for tablet computers "is just going up like a rocket ship," George Buckley, 3M's chief executive officer, said in a conference call. But he said 3M faces continued downward pressure on its films used to brighten the screens of television sets.
Sales in the latest quarter were up 30% in India, 27% in China and 25% in Brazil. 3M said these and other "emerging" markets accounted for 34% of its world-wide sales. Sales also were robust in other parts of the world, rising 13% in Europe and 10% in the U.S.
3M reported a 16% increase in first quarter profit and raised its earnings forecast for the full year as sales surged in India, China and Brazil. Paul Vigna and Stephen Wisnefski discuss.
3M said lingering disruption from the Japanese earthquake will hurt earnings by 10 to 13 cents per share this year. The main effects will be in 3M's businesses supplying parts and supplies to the automotive and consumer electronics industries. But those effects will dissipate in the second half and the company should benefit from higher demand for respiratory masks and other safety products, Mr. Buckley said.
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Net income was $1.08 billion, or $1.49 per share, up from $930 million, or $1.29 per share, a year earlier. Sales grew 15% to $7.31 billion.
3M projected that its earnings for the full year will be $6.05 to $6.25 a share. That's up from the previous forecast of $5.95 to $6.20.
Organic sales growth—which excludes the effects of recent acquisitions, price changes and currency fluctuations—should be 6% to 7.5% this year, up from the previous forecast of 5.5% to 7.5%. Mr. Buckley has touted a goal of raising its average organic sales growth rate to between 7% and 8% a year from a past norm of around 4%, largely by stepping up the pace of new-product launches, focusing on fast-growing markets like China and India, and making acquisitions.
3M's thousands of products include masking tape, protective films, automotive equipment, medical supplies, and cleaning fluids and other materials used in making mobile phones, computers, TV sets and semiconductors.
Write to James R. Hagerty at bob.hagerty@wsj.com
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