HomeMy WebLinkAbout2016 07-26 Strong dollar weighs on 3M’s results PIONEER PRESS7/26/2016 Strong dollar weighs on Ws results —Twin Cities
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PUBLISHED: July 26, 2016 at 11:49 am I UPDATED: July 26, 2016 at 12:17 pm
3M Co. cut its outlook for sales growth as the strong U.S. dollar weighed on second-quarter earnings for the maker
of Post -it notes and Scotch tape.
Currency -adjusted sales won't increase by more than 1 percent this year, the Maplewood -based company said
Tuesday. 3M earlier forecast a gain of 1 percent to 3 percent. The company also narrowed its annual earnings
projection to $8.15 to $8.30 a share from a previous range of $8.10 to $8.45 a share.
Share were down 1.4 percent at $177.20 in late -morning trading Tuesday.
The revisions signal continued challenges for the maker of adhesives, touch screens and dental tools, amid a
sluggish global economy and currency headwinds. Second-quarter sales dropped sharply in 3M's electronics
operation.
Chief Executive Officer Inge Thulin overhauled operations last year to reduce U.S. expenses and strengthen 3M's
business in Europe and Latin America. The company, which generates about two-thirds of revenue overseas, cut its
2015 forecast more than once last year.
Second-quarter earnings rose to $2.08 a share, beating the $2.06 average of analysts' estimates compiled by
Bloomberg. Sales fell 0.3 percent to $7.66 billion, compared with analysts' expectations of $7.7 billion. The strong
dollar reduced revenue by 1.5 percent, 3M said.
Revenue in the electronics and energy division tumbled 9.1 percent after stripping out currency effects, with the
company citing particular weakness in electronics and display materials. 3M has been restructuring the business,
including 250 job cuts, amid persistent softness in the consumer -electronics market.
"I think we have to wait into some time in 2017 before we see growth specifically in consumer electronics taking
place," Thulin said on a conference call.
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7/26/2016
Strong dollar weighs on Ws results —Twin Cities
Revenue in the Asia-Pacific region dropped 5.4 percent, the most of any geographic area, as electronics sales
declined.
3M shares had risen 19 percent this year through Monday following an 8.3 percent decline last year, the first annual
drop since 2011.
Tags: Business News
Bloomberg
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