3M Fourth-quarter Profit Tops View, But Sales Miss

(RTTNews) - 3M Co. (MMM) reported Tuesday a profit for the fourth quarter that grew from last year, reflecting improved operating margins and revenue growth amid increases across business groups and most regions.

Earnings per share topped analysts' expectations by a penny, while quarterly revenues missed their estimates. The company also reaffirmed its earnings and sales growth forecast range for the full-year 2015.

"3M delivered strong results in the fourth quarter, which culminated a solid 2014 performance. Organic growth was positive across all business groups and geographic areas, and operating margins rose by nearly a full point," Chairman, President and CEO Inge Thulin said in a statement.

The St. Paul, Minnesota-based diversified technology company reported net income of $1.18 billion or $1.81 per share for the fourth quarter, higher than $1.10 billion or $1.62 per share in the prior-year quarter.

On average, 15 analysts polled by Thomson Reuters expected the company to report earnings of $1.80 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter grew 2.0 percent to $7.71 billion from $7.57 billion in the same quarter last year, but missed thirteen Wall Street analysts' consensus estimate of $7.77 billion by a whisker.

Organic local-currency sales grew 6.3 percent as acquisitions added 0.1 percent to sales, while foreign exchange reduced sales by 4.4 percent in the quarter.

Industrial sales were up 1.4 percent to $2.6 billion, health care sales increased 2.4 percent to $1.4 billion, and consumer sales rose 2.2 percent to $1.1 billion from last year.

Electronics and energy sales improved 3.3 percent to $1.4 billion as well as safety and graphics sales grew 3.4 percent to $1.4 billion from a year ago.

On a geographic basis, sales declined 6.4 percent in Europe, Middle East and Africa or EMEA, while it remained flat in Latin America/Canada. Sales in the U.S. grew 6.9 percent, and Asia Pacific sales improved 3.1 percent from last year.

Operating margins for the quarter improved 60 basis points to 21.5 percent from last year.

The company had in mid-December declared a 20 percent higher dividend on the common stock of $1.025 per share for the first quarter of 2015, payable on March 12 to shareholders of record at the close of business on February 13, 2015.

Looking ahead to fiscal 2015, 3M continues to expect earnings in a range of $8.00 to $8.30 per share, on projected organic local-currency sales growth of 3 to 6 percent. Street is currently looking for full-year 2015 earnings of $8.20 per share on annual revenue growth of 2.9 percent to $32.83 billion.

In Tuesday's regular trading session, MMM is currently trading at $164.48, up $0.24 or 0.15% on a volume of 0.47 million shares. In the past 52-week period, the stock has been trading in a range of $123.61 to $168.16.