3M Net Income Up In 2Q Despite Lower Sales
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NEW YORK (AP) — 3M Co., the iconic maker of Post-Its and Scotch Tape, said Thursday it managed a slim increase in second-quarter earnings as cost-cutting offset a revenue shortfall.
The St. Paul, Minn., conglomerate posted net income of $1.17 billion, or $1.66 per share, compared with $1.16 billion, or $1.60 per share, a year earlier.
Revenue fell 2 percent to $7.53 billion. A strong U.S. dollar diluted the value of international sales. For instance, an 11 percent increase in sales in Latin America and Canada was almost entirely erased when sales in local currency were translated to dollars.
Besides popular household products, 3M makes office products and items ranging from stethoscopes to computer arms. Excluding the currency impact, sales rose in every division except for display and graphics, which has shown continued weakness because of slumping sales of films for LCD televisions. That unit also makes touch screen monitors and overhead projectors.
Sales in 3M’s biggest segment, industrial and transportation, rose 4.2 percent. But when exchange rates were factored in, sales fell 0.6 percent.
Analysts expected net income of $1.65 per share on revenue of $7.79 billion, according to FactSet.
Costs fell nearly 4 percent to $5.81 billion.
3M maintained its full-year earnings forecast. It expects to earn between $6.35 and $6.50 per share, compared with $5.96 per share in 2011. It expects sales to fall by 3 percent because of continued strength in the dollar, implying sales of $28.72 billion. Excluding that impact, 3M predicts sales will rise 2 to 5 percent.
Analysts, on average, predict earnings of $6.39 per share on revenue of $30.56 billion.
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