3M Announces Record Second-Quarter Earnings of $1.66 per Share

3M reported record second-quarter earnings of $1.66 per share, an increase of 3.8% versus the second quarter of 2011. Operating income was $1.7 billion and operating income margins for the quarter were 22.9%. All of the company’s six business segments posted operating income margins greater than 20%.

Sales were $7.5 billion, down 1.9% year-over-year. Organic local-currency sales grew 1.9% and acquisitions added 0.5 percent to sales. The company noted that the combination of challenging economic conditions and the strong U.S. dollar hurt sales in the quarter. Currency impacts reduced sales by 4.3% year-on-year.

On a business segment basis, organic local-currency sales increased 5.4% in Health Care, 4.2%t in Industrial and Transportation, 3.1% in Consumer and Office and 3.1% in Safety, Security and Protection Services. Organic local-currency sales declined 1.8% in Electro and Communications and 6.6% in Display and Graphics, both impacted by weakness in the consumer electronics industry. On a geographic basis, organic local-currency sales grew 11.4% in Latin America/Canada and 3.6% in the U.S., while Asia Pacific and EMEA (Europe, Middle East and Africa) declined 0.6% and 1.9%, respectively.

Second-quarter net income was $1.2 billion and earnings were $1.66 per share. Total-company operating income margins were 22.9% for the quarter, and free cash flow exceeded $1.0 billion.

“Our team performed very well in the quarter, delivering excellent productivity and record second-quarter earnings,” said Inge G. Thulin, 3M chairman, president and CEO. “We achieved these results through outstanding factory efficiency and cost discipline throughout the organization. Going forward, we will keep driving to achieve strong earnings and cash flow. At the same time we will expand 3M’s customer relevance through strategic investments in manufacturing, innovation and commercialization.”