3M(US:MMM)2024-10-22 10:35Financial Performance - Sales of $6.3 billion, up 0.4% year-on-year, with adjusted sales of $6.1 billion, reflecting a 1.5% increase year-on-year[1][4] - GAAP EPS from continuing operations of $2.48, up 154% year-on-year, and adjusted EPS of $1.98, up 18% year-on-year[1][3] - Adjusted operating income margin increased to 23.0%, up 1.4 percentage points year-on-year[3] - Total Company GAAP net sales were $6,294 million, reflecting a 0.4% increase year-over-year[35] - Adjusted amounts (non-GAAP measures) for total company were $6,068 million, representing a 1.5% increase[35] - Operating income for total company was $1,316 million, with an operating income margin of 20.9%[35] - The adjusted operating income margin for the total company was 21.6% for the three months ended September 30, 2023[34] - Adjusted net income attributable to 3M for the three months ended September 30, 2023, was $934 million, with earnings per share of $1.68[34] Cash Flow and Debt Management - Operating cash flow of $(1.8) billion, primarily due to $3.6 billion in net after-tax payments for significant litigation costs[1][5] - Adjusted free cash flow for the quarter was $1.5 billion[1][5] - The company reported a net increase in cash and cash equivalents of $117 million for the nine months ended September 30, 2024, compared to an increase of $1,485 million in the same period of 2023[13] - The company’s long-term debt decreased from $13,088 million to $11,319 million, a reduction of 13.5%[11] - The company reported a total debt of $13,189 million as of September 30, 2024, down from $16,035 million at the end of December 2023[46] - Net debt decreased to $5,874 million as of September 30, 2024, compared to $10,230 million at the end of December 2023[47] Shareholder Returns - The company returned $1.1 billion to shareholders through dividends and share repurchases[5] - Full-year 2024 adjusted EPS guidance raised to a range of $7.20 to $7.30, up from the previous range of $7.00 to $7.30[1][6] - The forecast for 2024 adjusted earnings per share from continuing operations is projected to be between $7.20 and $7.30[37] Segment Performance - The Safety and Industrial segment reported net sales of $2,767 million for the three months ended September 30, 2023, up from $2,751 million in the same period of 2022[22] - The Transportation and Electronics segment had net sales of $2,139 million for the three months ended September 30, 2023, down from $2,171 million in the same period of 2022[22] - The Consumer segment reported net sales of $1,299 million for the three months ended September 30, 2023, slightly down from $1,315 million in the same period of 2022[22] - Business segment operating income for Safety and Industrial was $672 million in Q3 2024, compared to $708 million in Q3 2023[46] Litigation and Special Items - Corporate special items included net costs for significant litigation of $(25) million for the three months ended September 30, 2023, compared to $(4,241) million in the same period of 2022[23] - The company continues to focus on corporate special items related to litigation and divestiture costs, impacting overall financial performance[24] - In Q3 2024, 3M made net pre-tax payments of approximately $3.7 billion related to significant litigation costs, compared to $416 million in Q3 2023[49] - For the first nine months of 2024, 3M's net pre-tax payments for significant litigation costs totaled approximately $4.5 billion, up from $618 million in the same period of 2023[49] - The total special items for the nine months ended September 30, 2023, included net costs for significant litigation amounting to $14,803 million[36] Organic Sales Growth - Organic sales growth was reported at 1.0% year-on-year, despite a slight decline in total organic sales[4][5] - The company anticipates adjusted organic sales growth to be flat to +2% for the full year 2024[6] - Total company organic sales decreased by 0.2% for the nine months ended September 30, 2024, with total sales change also at (0.2)%[39] - Adjusted total company organic sales increased by 1.0% for the nine months ended September 30, 2024, excluding the impact of manufactured PFAS products[39] Strategic Focus - The company is focusing on three priorities: organic growth, operational excellence, and capital deployment for long-term value creation[2] - The former Health Care business segment was eliminated in the second quarter of 2024 due to the separation of Solventum, impacting the overall segment reporting[19] - The company created new divisions within its business segments, including Industrial Specialties and Commercial Branding and Transportation, to enhance operational focus[20] Tax and Regulatory Matters - The effective tax rate for the company was 20.3%[35] - The adjusted effective tax rate for 2024 is expected to be between 19% and 20%[37] - The company reported a provision for income taxes of $348 million in Q3 2024, compared to a tax benefit of $(777) million in Q3 2023[44]