SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------------
FORM 10-Q
FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION
13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF
1934
For Quarter ended June 30, 1993 Commission file
number:1-3285
------------------------------
MINNESOTA MINING AND MANUFACTURING COMPANY
State of Incorporation: Delaware I.R.S. Employer Identification
No. 41-0417775
Executive offices: 3M Center, St. Paul,
Minnesota 55144
Telephone number: (612) 733-1110
------------------------------
Indicate by check mark whether the Registrant (1) has
filed all
reports required to be filed by Section 13 or 15(d) of the
Securities
Act of 1934 during the preceding 12 months (or for such
shorter period
that the Registrant was required to file such reports), and
(2) has been
subject to such filing requirements for the past 90 days.
Yes X . No .
------------------------------
On June 30, 1993, there were 216,974,988 shares of the
Registrant's
common stock outstanding.
This document contains 16
pages.
<PAGE>
MINNESOTA MINING AND MANUFACTURING COMPANY
AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION
CONSOLIDATED STATEMENT OF INCOME
(Amounts in millions, except per-share data)
(Unaudited)
Three months ended Six
months ended
June 30
June 30
1993 1992 1993
1992
------ ------
- - ------- -------
Net Sales $3,540 $3,519 $
7,057 $ 6,957
Operating Expenses
Cost of goods sold 2,131 2,115
4,243 4,173
Selling, general and
administrative expenses 893 887
1,768 1,758
Total 3,024 3,002
6,011 5,931
------ ------
- - ------- -------
Operating Income 516 517
1,046 1,026
Other Income and Expense
Interest expense 15 19
26 41
Investment and other
income - net (21) 1
(30) ( 1)
Total ( 6) 20 (
4) 40
Income Before Income Taxes,
Minority Interest and
Cumulative Effect of
Accounting Changes 522 497
1,050 986
Provision For Income Taxes 184 175
372 350
Minority Interest 7 5
17 13
------ ------
- - ------- -------
Income Before Cumulative
Effect of Accounting
Changes 331 317
661 623
Cumulative Effect of
Accounting Changes - -
- - - 3
Net Income $ 331 $ 317 $
661 $ 620
====== ======
======= =======
Average Number of Common
Shares Outstanding 218.2 219.0
218.5 219.1
Per Share of Common Stock:
Income Before Cumulative
Effect of Accounting
Changes $ 1.51 $ 1.45 $
3.02 $ 2.85
Cumulative Effect of
Accounting Changes - -
- - - (.02)
Net Income $ 1.51 $ 1.45 $
3.02 $ 2.83
====== ======
======= =======
Cash dividends declared
and paid $ .83 $ .80 $
1.66 $ 1.60
The Notes to Financial Statements are an integral part of this
statement.
-2-
<PAGE>
MINNESOTA MINING AND MANUFACTURING COMPANY
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(Dollars in millions)
June 30,
1993
December 31,
(Unaudited)
1992
ASSETS
Current Assets
Cash and cash equivalents $ 329
$ 382
Other securities 321
340
Accounts receivable - net 2,665
2,394
Inventories
Finished goods 1,233
1,224
Work in process 584
586
Raw materials and supplies 535
505
-------
-------
Total inventories 2,352
2,315
Other current assets 715
778
-------
-------
Total current assets 6,382
6,209
Investments 448
452
Property, Plant and Equipment 11,223
10,828
Less accumulated depreciation (6,410)
(6,036)
Property, plant and equipment - net 4,813
4,792
Other Assets 502
502
Total $12,145
$11,955
=======
=======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable $ 749
$ 836
Income taxes 275
299
Short-term debt 829
739
Other current liabilities 1,512
1,367
-------
-------
Total current liabilities 3,365
3,241
Other Liabilities 1,511
1,428
Long-Term Debt 679
687
Stockholders' Equity
Common stock, no par, 236,008,264
shares issued 296
296
Retained earnings 8,268
8,012
Unearned compensation - ESOP (489)
(498)
Cumulative translation - net (244)
(198)
Less cost of treasury stock -
June 30, 1993, 19,033,276 shares;
December 31, 1992, 16,974,214 shares (1,241)
(1,013)
Stockholders' Equity - net 6,590
6,599
Total $12,145
$11,955
=======
=======
The Notes to Financial Statements are an integral part of
this statement.
-3-
<PAGE>
MINNESOTA MINING AND MANUFACTURING COMPANY
AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(Dollars in millions)
(Unaudited)
Six
months ended
June 30
- - -------------------
1993
1992*
-------
-------
Cash Flows from Operating Activities:
Net income $ 661
$ 620
Adjustments to reconcile net income
to net cash provided by operating activities:
Cumulative effect of adopting SFAS Nos. 106
and 109 -
103
Legal settlement 129
-
Depreciation and amortization 517
560
Working capital changes (351)
(351)
Other 32
41
- - -----------------------------------------------------------------
- - -------
Net cash provided by operating activities 988
973
Cash Flows from Investing Activities:
Capital expenditures (521)
(694)
Disposals of property, plant and equipment 36
44
Other (2)
14
- - -----------------------------------------------------------------
- - -------
Net cash used in investing activities (487)
(636)
Cash Flows from Financing Activities:
Net change in short-term debt 135
67
Repayment of long-term debt ( 96)
( 99)
Proceeds from long-term debt 54
134
Purchases of treasury stock (383)
(123)
Reissuances of treasury stock 114
80
Payment of dividends (364)
(351)
Other -
6
- - -----------------------------------------------------------------
- - -------
Net cash used in financing activities (540)
(286)
Effect of exchange rate changes on cash (14)
(3)
- - -----------------------------------------------------------------
- - -------
Net increase/(decrease) in cash and
cash equivalents (53)
48
Cash and cash equivalents at beginning of year 382
258
- - -----------------------------------------------------------------
- - -------
Cash and cash equivalents at end of period $ 329
$ 306
=================================================================
=======
* Includes cash flows of the international companies for
the eight-month
period November 1, 1991 to June 30, 1992.
The Notes to Financial Statements are an integral part of
this statement.
-4-
<PAGE>
MINNESOTA MINING AND MANUFACTURING COMPANY
AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
The interim financial statements are unaudited
but, in the
opinion of management, reflect all adjustments
necessary for a
fair presentation of financial position, results of
operations
and cash flows for such periods. These adjustments
consist of
normal, recurring items. The results of
operations for any
interim period are not necessarily indicative of
results for the
full year. The condensed consolidated financial
statements and
notes are presented as permitted by Form 10-Q and do
not contain
certain information included in the company's annual
consolidated
financial statements and notes. This Form 10-Q should
be read in
conjunction with the company's consolidated financial
statements
and notes incorporated by reference in the 1992 Annual
Report on
Form 10-K.
Effective January 1, 1992, 3M's international
companies changed
their fiscal year-end from October 31 to December
31 and 3M
adopted two new accounting standards, Statement of
Financial
Accounting Standards (SFAS) No. 106, "Employers'
Accounting for
Postretirement Benefits Other Than Pensions," and
SFAS No. 109,
"Accounting for Income Taxes." The first and second
quarter 1992
financial statements were restated in 1992 to
reflect these
changes. All three changes were accounted for as
cumulative
effects of accounting changes. As a result of the
change in the
international companies' fiscal year-end, the cash
flows of the
international companies for the eight-month period
November 1,
1991 to June 30, 1992, are included in the Consolidated
Statement
of Cash Flows for the period ended June 30, 1992.
In July 1993, subsequent to the end of the second
quarter, the
company received $48 million as a result of the
resolution of
several income tax claims. The recovery included $28
million of
interest which will be recorded as income in the third
quarter of
1993. Since the majority of the noninterest
portion of the
refund had previously been recorded as a prepaid tax,
this refund
will not impact the 1993 tax provision.
Coopers & Lybrand, the company's independent
accountants, have
performed a review of the unaudited interim financial
statements
included herein and their letter accompanies this
filing.
-5-
<PAGE>
MINNESOTA MINING AND MANUFACTURING COMPANY
AND SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations
RESULTS OF OPERATIONS
This Quarter
------------
Worldwide sales for the second quarter totaled $3.540
billion, an
increase of 0.6 percent from $3.519 billion in the
second quarter
last year. Net income increased 4.2 percent to $331
million, or
$1.51 per share, compared with $317 million, or $1.45
per share,
in the same quarter last year.
In the United States, the company's unit sales
rose about 4
percent compared with the second quarter last
year. The
Industrial and Consumer Sector led U.S. volume growth
with solid
gains in its abrasives, specialty chemicals, and
commercial and
consumer products, and modest growth in its automotive
products.
Volume also increased in the Information, Imaging and
Electronic
Sector, paced by growth in its imaging systems
and memory
technologies products. Volume declined in its
telecommunication,
electronic and micrographic products. Life
Sciences Sector
volume increased with solid growth in its traffic and
personal
safety products largely offset by declines in its
health care
products. Overall, the company's United States
volume growth
slowed compared with the first quarter of 1993
due to a
combination of economic and industry-specific factors.
Outside the United States, unit volume also
increased about 4
percent. Volume declined about 1 percent in Europe
reflecting
the area's difficult economic environment. The
decline was
driven by Germany, which more than offset a gain in
the United
Kingdom. Volume growth was positive in the rest of
the world.
Asia Pacific had 12 percent volume growth where an
improvement in
Japan added to the rapid growth in the rest of
Asia. Latin
America, led by Brazil, was up nearly 25 percent.
Canada and
Africa also reported volume gains.
Worldwide selling prices declined about 1 percent
compared to the
second quarter of 1992. Competition in the
company's memory
technologies business again affected worldwide
price levels.
International price declines were about the same as
those in the
United States. Currency translation decreased
worldwide sales by
a little more than 2 percent.
Cost of goods sold, which includes manufacturing,
research and
development, and engineering, was $2.131 billion in
the second
quarter of 1993, an increase of 0.8 percent from
$2.115 billion
in 1992. Cost of goods sold was 60.2 percent of
sales, up one-
tenth of a point from the second quarter last
year. Gross
margins were hampered by lower selling prices,
negative currency
effects and higher R&D spending. These impacts were
partially
offset by lower raw material costs, cost controls
and lower
employment levels.
-6-
<PAGE>
MINNESOTA MINING AND MANUFACTURING COMPANY
AND SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations
Selling, general, and administrative spending of $893
million was
25.2 percent of sales, the same percentage as in
the second
quarter last year. SG&A costs reflected continued
emphasis on
cost control.
Worldwide operating income was $516 million in
the second
quarter, essentially unchanged from $517 million in
the second
quarter of 1992. Operating income in the United
States was up
about 12 percent and operating margins improved by 1.2
percentage
points. Lower raw material costs, cost controls
and lower
employment levels generated most of the increase.
International
operating income declined nearly 10 percent and margins
were down
1.4 percentage points due to negative currency
effects and
economic weakness in Europe. Worldwide employment was
down about
1,220 people from the second quarter last year.
On a sector basis, the Life Sciences Sector showed
worldwide
operating income growth compared with the same quarter
last year.
In the Industrial and Consumer Sector, a solid gain
in United
States operating income was offset by negative
currency effects
and by economic weakness in Europe. Information,
Imaging and
Electronic Sector operating income declined due to
negative
currency effects, slower demand for several of its
major product
lines and price erosion in memory technologies.
Interest expense was $15 million in the second quarter
of 1993,
$4 million lower than in the same quarter last
year. This
decline was mainly due to lower debt than in the
same quarter
last year. Investment and other income-net
contributed $21
million to pretax income in the second quarter of
1993 compared
to a $1 million expense in the same quarter last
year. This
change was due to several factors, including
technology write-
downs of about $10 million in 1992's second quarter
and cash
returns from other investments and hedging activities
of about $7
million in the second quarter of 1993.
The provision for income taxes was $184 million
compared with
$175 million in the second quarter last year. The
second quarter
1993 worldwide effective tax rate was 35.5 percent,
up one-half
point from the second quarter rate last year and up
two-tenths of
a point from the rate for 1992 overall. The
increase in the
second quarter rate compared to the same quarter
last year is
primarily due to last year's recognition of
additional foreign
tax credits.
Net income was $331 million, an increase of 4.2 percent
from $317
million in the second quarter last year. Earnings
per share
increased 4.1 percent to $1.51 per share from $1.45
per share
last year.
The company estimates that changes in the value of
the U.S.
dollar reduced net income by $13 million, or 6 cents
per share,
in the second quarter compared to the corresponding
quarter in
1992.
-7-
<PAGE>
MINNESOTA MINING AND MANUFACTURING COMPANY
AND SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations
These estimates include the effect of translating
sales
and profits from local currencies into U.S. dollars,
the costs in
local currencies of transferring goods between the
parent company
in the United States and international companies, and
transaction
gains and losses in countries not considered to
be highly
inflationary.
Year-To-Date
------------
On a year-to-date basis, worldwide sales totaled
$7.057 billion,
an increase of 1.4 percent from $6.957 billion in the
first six
months of last year. Volume growth for the first six
months of
1993 was 5 percent in both United States and
international
operations. Pricing and currency decreased worldwide
sales by
about 4 percent during the first six months.
Cost of goods sold was $4.243 billion for the first
six months,
an increase of 1.7 percent from $4.173 billion in
1992. Cost of
goods sold was 60.2 percent of sales, up two-tenths
of a point
from the same period last year. The factors that
influenced
year-to-date gross margins were the same as those for
the second
quarter.
First half selling, general, and administrative
spending of
$1.768 billion was 25.0 percent of sales, down
three-tenths of a
point from 25.3 percent in the same period last
year. In
addition to cost control, the year-to-date SG&A
percentage was
helped by lower voluntary separation costs.
Worldwide operating income increased 1.9 percent
to $1.046
billion in 1993 from $1.026 billion in 1992. Operating
income in
the United States was up about 15 percent and margins
improved by
1.4 percentage points. International operating
income declined
about 7 percent and margins were down 1.1 percentage
points due
to negative currency effects and economic weakness in
Europe.
While worldwide employment levels declined about 1,220
compared
with the second quarter of 1992, worldwide employment
increased
by 825 people from the end of 1992 due to seasonal,
temporary
hiring in the second quarter.
Interest expense was $26 million for the first six
months of
1993, down from $41 million in 1992. This decline was
mainly due
to lower debt than in the first half of 1992.
Investment and
other income was $30 million in the first half of
1993, up from
$1 million last year. This change was due to
several factors,
including technology write-downs of about $19 million
in 1992's
first half and cash returns from other investments
of about $5
million in the first half of 1993.
The provision for income taxes was $372 million
year-to-date in
1993 compared with $350 million in 1992. The
effective tax rate
was 35.5 percent in both periods.
-8-
<PAGE>
MINNESOTA MINING AND MANUFACTURING COMPANY
AND SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations
Year-to-date net income was $661 million in 1993, up
6.6 percent
from $620 million in 1992. Earnings per share
increased 6.7
percent to $3.02 per share from $2.83 per share last
year. Last
year's first-half earnings included a net negative
effect of $3
million, or 2 cents per share, from the adoption of
SFAS No. 106
and SFAS No. 109 and from the change in the reporting
period for
3M's international companies.
****
Looking ahead, the company continues to monitor
worldwide
economies, particularly the recessions in Europe and
Japan where
it has significant operations. The company's
economic outlook
for the second half of the year does not anticipate
significant
improvements in either of these two areas. The
company also
expects a continuation of relatively slow economic
growth in the
United States during the second half of the year.
The effects of a stronger dollar are expected to
continue to
hamper earnings growth in the second half of the
year. The
company estimates that currency effects, based on the
levels at
the end of June, could reduce full-year 1993
earnings by an
estimated 30 to 35 cents per share.
Assuming that overall economic conditions are in line
with the
company's expectations and that currency values remain
relatively
stable, the company anticipates earnings increases
for both the
second half and the full year of 1993 compared to
1992. First-
half 1993 earnings increased 4.1 percent.
Expectations about
third quarter earnings are guarded due to potentially
significant
adverse currency impacts and continuing economic
weakness outside
the United States. Fourth quarter earnings are
expected to be
better than last year's results when international
volume slowed
significantly.
Volume growth, productivity improvements and
favorable raw
material prices are expected to benefit full-year
1993 results.
Investment in research and development will continue
in order to
help the company move toward its goal of 30 percent
of sales
coming from products introduced in the last four
years. The
company continues to aggressively explore cost
reduction and
rationalization opportunities around the world in
addition to its
continuing emphasis on management of SG&A spending
to more
closely match current worldwide growth expectations.
Worldwide
employment by the end of the year is expected to be
lower than
1992 year-end levels.
As indicated in the Notes to the Financial Statements,
interest
income generated by the resolution of income tax
disputes will be
recorded in the third quarter. Since the
majority of the
noninterest portion of the refund had previously been
recorded as
a prepaid tax, this refund will not impact the
1993 tax
provision. The company's tax rate is expected to
remain at about
current levels.
-9-
<PAGE>
MINNESOTA MINING AND MANUFACTURING COMPANY
AND SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations
FINANCIAL CONDITION AND LIQUIDITY
The company's financial condition and liquidity remain
strong.
Working capital increased $49 million to $3.017
billion from
$2.968 billion as of December 31, 1992. The accounts
receivable
average days sales outstanding, which averages monthly
sales and
receivable balances within the quarter, was 65
days. The
company's key inventory index, which represents the
number of
months of inventory, was 3.8 months. The company's
current ratio
was 1.9. All three indices were unchanged from the
year-end 1992
numbers.
Other current liabilities increased $145 million
from year-end
1992 to $1.512 billion. This change was largely due to
increases
in the international companies.
Total debt increased $82 million from year-end 1992
to $1.508
billion. On June 30, 1993, the company issued a
$99 million
medium-term note with a maturity date of June 15,
1994, from the
$601 million shelf registration filed with the
Securities and
Exchange Commission in 1992. As of June 30, 1993,
$502 million
was available for future financial needs.
As of June 30, 1993, total debt was 23 percent of
stockholders'
equity. The ratio is 1 percentage point higher than at
year-end
1992. The company's borrowings continue to maintain
AAA long-
term ratings.
Due to the change in the financial reporting
period for the
international companies, the June 30, 1992,
Consolidated
Statement of Cash Flows includes the cash provided
or used by
3M's international companies for an eight-month period
(November
1, 1991 to June 30, 1992). The following table and
discussion
are presented on a comparative basis, excluding the
November 1 to
December 31, 1991, period for International Operations.
=================================================================
Six
months ended
June
30
- - -------------------
1993
1992
-------
- - -------
Net cash provided by operating activities $ 988
$ 914
Net cash used in investing activities (487)
(539)
Net cash used in financing activities (540)
(411)
Effect of exchange rate changes on cash (14)
(8)
-------
- - -------
Net increase/(decrease) in cash and cash
equivalents $ (53)
$ (44)
=======
=======
Capital spending $ 521
$ 601
=======
=======
Depreciation and amortization $ 517
$ 503
=======
=======
=================================================================
-10-
<PAGE>
MINNESOTA MINING AND MANUFACTURING COMPANY
AND SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations
Net cash provided by operating activities totaled $988
million in
the first six months of the year, an increase of $74
million from
$914 million in the same period last year.
Receipt of the
Johnson & Johnson legal settlement and higher income
were the
main sources of the increase.
Cash used in investing activities was $487 million,
down $52
million from the same period last year due to
lower capital
spending. Capital expenditures for the first six
months of 1993
were $521 million, a decrease of over 13 percent
compared with
the same period last year. The company expects
1993 capital
spending to be less than 1992 levels.
Cash used in financing activities in the first six
months was
$540 million, up $129 million compared with the same
period last
year, primarily because less cash was provided by new
long-term
borrowing and because treasury stock purchases
increased. During
the second quarter the company repurchased about
2.4 million
shares. Cash provided by issuance of medium-term
notes and
increases in commercial paper partially offset these
factors.
Stockholder dividends increased 4 percent to $364
million in the
first six months of this year. The dividend
payout ratio
declined to 55.0 percent in the first six months
from 56.9
percent for the entire year in 1992, primarily due
to higher
earnings in the first six months.
The Board of Directors authorized the repurchase
of up to
6 million shares of 3M common stock between June 1,
1993, and May
31, 1994. Of this number, 4.4 million shares remained
authorized
for repurchase on June 30, 1993. Repurchases are made
to support
employee stock purchase and management stock ownership
plans and
for other corporate purposes.
Return on average stockholders' equity for the quarter
increased
to 19.9 percent from 19.5 percent a year earlier,
approaching the
company's goal of 20 to 25 percent. Return on
capital employed
for the quarter was 20.1 percent, down from 20.3
percent in the
comparable 1992 period. The company's goal is 27
percent or
better.
The company expects cash generated by normal
operations will
support its growth. As indicated in the Notes to the
Financial
Statements, the company's receipt of $48 million in
resolution of
several income tax claims will positively impact cash
flow in the
third quarter of the year. With its AAA long-term
ratings on its
debt, the company has sufficient borrowing capacity to
supplement
cash flows from operations.
-11-
<PAGE>
MINNESOTA MINING AND MANUFACTURING COMPANY
AND SUBSIDIARIES
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
The company and certain of its subsidiaries
are named
defendants in a number of actions,
governmental
proceedings and claims, including product
liability
claims involving products now or formerly
manufactured
and sold by the company, many of which
relate to
silicone gel mammary prostheses, and some
of which
claims are purported or tentatively
certified class
actions. In some cases, these actions seek
damages as
well as other relief which, if granted,
would require
substantial expenditures. Many of these
actions raise
difficult and complex factual and legal
issues and are
subject to many uncertainties and
complexities,
including, but not limited to, the
facts and
circumstances of each particular
action, the
jurisdiction and forum in which each
action is
proceeding, and differences in
applicable law.
Accordingly, the company is not always able
to estimate
the nature and amount of any future
liability with
respect to these actions.
In many of these actions, the company
believes that
resulting liability and defense costs are
covered by
insurance maintained by the company during
applicable
time periods, subject to self-insurance
retentions,
exclusions, and policy limits. The company
may also
possess rights against third
parties for
indemnification or contribution. To the
extent that
insurers have in some of these cases
reserved, and may
reserve in the future, the right to deny
coverage (i.e.
neither admitted nor denied coverage), the
company is
not always able to estimate the amount of
recovery
applicable to these actions.
Because of the complexities of these
actions and the
extent of insurance applicable to many
of these
actions, the company cannot determine its
exposure or
its rights against insurers and other third
parties.
While it is possible that any charge
incurred as a
result of the foregoing matters could have
a negative
impact on the company's net income for any
period in
which it is recorded, the company believes
that any
resulting charge will not have a
material adverse
effect on its consolidated financial
position.
The company is involved in a number of
environmental
actions by governmental agencies asserting
liability
for cleanup costs for past disposal of
hazardous wastes
at waste disposal sites. The company
conducts ongoing
investigations, assisted by environmental
consultants,
to determine accruals for the probable,
estimable costs
of remediation. The remediation accruals
are reviewed
each quarter and changes are made as
appropriate.
-12-
<PAGE>
MINNESOTA MINING AND MANUFACTURING COMPANY
AND SUBSIDIARIES
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security
Holders
(a) The registrant held its Annual
Meeting of
Stockholders on May 11, 1993.
(b) Proxies for the meeting were solicited
pursuant to
Regulation 14; there was no
solicitation in
opposition to management's nominees for
directors
as listed in the Proxy Statement and
all such
nominees were elected.
Directors elected were Lawrence E.
Eaton, Harry A.
Hammerly, Ronald A. Mitsch, Rozanne
L. Ridgway,
Frank Shrontz and Louis W. Sullivan.
Directors whose terms continue after
the meeting
were Edward A. Brennan, Livio D.
DeSimone, George
M. C. Fisher, Allen F. Jacobson, Allen
E. Murray,
Aulana L. Peters, Jerry E. Robertson
and F. Alan
Smith.
(c) Briefly described below is the other
matter voted
upon at the Annual Meeting and the
number of
affirmative votes and negative votes
cast.
(i) Ratification of the appointment
of Coopers
& Lybrand, independent
certified public
accountants, to audit the
books and
accounts of the company
and its
subsidiaries for the year 1993.
For
180,966,324
Against
456,885
Abstain
492,696
Item 6. Exhibits and Reports on Form 8-K
(a) The following documents are filed as
exhibits to
this Report.
(11) A statement regarding the
computation of
per share earnings.
(12) A statement regarding the ratio
of earnings
to fixed charges.
(15) A letter from the company's
independent
accountants regarding
unaudited interim
financial statements.
-13-
<PAGE>
MINNESOTA MINING AND MANUFACTURING COMPANY
AND SUBSIDIARIES
PART II. OTHER INFORMATION
(b) The company filed a report on Form
8-K dated
June 30, 1993, related to a shelf
registration of
medium-term notes. This filing
included the
following:
Exhibit 4 Form of Medium-Term Indexed
Notes Due
June 15, 1994.
Exhibit 10 Calculation Agency
Agreement, dated
as of June 24, 1993 between
Minnesota
Mining and Manufacturing
Company and
Goldman, Sachs & Co.
None of the other items contained in Part II of
Form 10-Q is
applicable to the company for the quarter ended June
30, 1993.
-14-
<PAGE>
|Coopers |certified public
accountants
|&Lybrand |
REPORT OF INDEPENDENT ACCOUNTANTS
To the Stockholders of Minnesota Mining and
Manufacturing
Company:
We have reviewed the accompanying condensed
consolidated balance
sheet of Minnesota Mining and Manufacturing
Company and
subsidiaries as of June 30, 1993, and the related
condensed
consolidated statements of income for each of the
three- and six-
month periods ended June 30, 1993 and 1992 and cash
flows for the
six-month periods ended June 30, 1993 and 1992. These
financial
statements are the responsibility of the company's
management.
We conducted our reviews in accordance with standards
established
by the American Institute of Certified Public
Accountants. A
review of interim financial information consists
principally of
applying analytical review procedures to financial
data and
making inquiries of persons responsible for
financial and
accounting matters. It is substantially less in
scope than an
audit conducted in accordance with generally
accepted auditing
standards, the objective of which is the expression of
an opinion
regarding the financial statements taken as
a whole.
Accordingly, we do not express such an opinion.
Based on our reviews, we are not aware of any
material
modifications that should be made to the accompanying
condensed
consolidated financial statements referred to above
for them to
be in conformity with generally accepted accounting
principles.
We have previously audited, in accordance with
generally accepted
auditing standards, the consolidated balance
sheet as of
December 31, 1992, and the related consolidated
statements of
income and cash flows for the year then ended (not
presented
herein); and in our report dated February 15, 1993, we
expressed
an unqualified opinion on those consolidated
financial
statements. In our opinion, the information set
forth in the
condensed consolidated balance sheet as of December
31, 1992 is
fairly stated in all material respects in
relation to the
consolidated balance sheet from which it has been
derived.
COOPERS & LYBRAND
St. Paul, Minnesota
July 30, 1993
-15-
<PAGE>
SIGNATURE
---------
Pursuant to the requirements of the Securities Exchange
Act of 1934, the
registrant has duly caused this report to be signed on its
behalf by the
undersigned thereunto duly authorized.
MINNESOTA MINING AND
MANUFACTURING COMPANY
- - ------------------------------------------
(Registrant)
Date: August 9, 1993
/s/Giulio Agostini
- - -------------------------------------------------
Giulio Agostini, Senior Vice
President, Finance
(Mr. Agostini is the Principal
Financial and
Accounting Officer and has been
duly authorized
to sign on behalf of the
registrant.)
-16-
<PAGE>
<TABLE>
EXHIBIT 11
MINNESOTA MINING AND MANUFACTURING
COMPANY
AND SUBSIDIARIES
EARNINGS PER SHARE OF COMMON
STOCK
<CAPTION>
Three Months
Ended Six Months Ended
June 30
June 30
- - ------------------------ ------------------------
1993
1992 1993 1992
(Millions) -----------
- - ----------- ----------- -----------
<S> <C> <C>
<C> <C>
Income before cumulative effect
of accounting changes $331
$317 $661 $623
Cumulative effect of accounting changes -
- - 3
------
- - ------ ------ ------
Net income $331
$317 $661 $620
======
====== ====== ======
_________________________________________________________________
_____ ____________________________
Primary earnings per share:
Income before cumulative effect
of accounting changes $1.51
$1.45 $3.02 $2.85
Cumulative effect of accounting changes -
- - (0.02)
------
- - ------ ------ ------
Earnings per share $1.51
$1.45 $3.02 $2.83
======
====== ====== ======
Weighted average number of
common shares outstanding 218,180,059
219,006,461 218,473,216 219,086,081
===========
=========== =========== ===========
_________________________________________________________________
__________________________________
Fully diluted earnings per share: (1)<F1>
Income before cumulative effect
of accounting changes $1.50
$1.43 $2.99 $2.81
Cumulative effect of accounting changes -
- - (0.01)
------
- - ------ ------ ------
Earnings per share $1.50
$1.43 $2.99 $2.80
======
====== ====== ======
Weighted average number of
common shares outstanding 218,180,059
219,006,461 218,473,216 219,086,081
Common equivalent shares 2,480,054
2,188,369 2,214,535 2,188,369
-----------
- - ----------- ----------- -----------
Average number of common
shares outstanding and
equivalents 220,660,113
221,194,830 220,687,751 221,274,450
===========
=========== =========== ===========
<FN>
_________________________________________________________________
__________________________________
Primary earnings per share is computed by dividing net income
by the weighted average number
of common shares outstanding for each period. The calculation
excludes the effect of common equivalent
shares resulting from stock options using the treasury stock
method as the effect would not be material.
Fully diluted earnings per share is computed based on the
weighted average number of common
shares and common equivalent shares outstanding for each period.
<F1>(1) This calculation is submitted in accordance with
Regulation S-K item 601(b)(11) although not
required by APB Opinion No. 15 because it results in dilution
of less than 3%.
</TABLE>
<TABLE>
EXHIBIT 12
MINNESOTA MINING AND MANUFACTURING
COMPANY
AND SUBSIDIARIES
CALCULATION OF RATIO OF EARNINGS TO
FIXED CHARGES
(Dollars in millions)
<CAPTION>
Six Months Ended
June 30, 1993
1992 1991 1990 1989 1988
EARNINGS ------------------
- - ------ ------ ------ ------ ------
<S> <C> <C>
<C> <C> <C> <C>
Income Before Income Taxes,
Minority Interest and Cumulative
Effect of Accounting Changes $1,050
$1,947 $1,877 $2,135 $2,099 $1,985
Add:
Interest on debt 26
76 97 98 98 99
Interest component of the ESOP
benefit expense 21
42 44 45 - -
Portion of rent under operating
leases representative of
the interest component 23
47 47 44 35 36
Less:
Equity in undistributed income
of 20-50% owned companies -
(1) (6) 1 4 11
------
- - ------ ------ ------ ------ ------
TOTAL EARNINGS AVAILABLE $1,120
$2,113 $2,071 $2,321 $2,228 $2,109
FOR FIXED CHARGES ======
====== ====== ====== ====== ======
FIXED CHARGES
Interest on debt $26
$76 $97 $98 $98 $99
Interest component of the ESOP
benefit expense 21
42 44 45 - -
Portion of rent under operating
leases representative of
the interest component 23
47 47 44 35 36
------
- - ------ ------ ------ ------ ------
TOTAL FIXED CHARGES $70
$165 $188 $187 $133 $135
======
====== ====== ====== ====== ======
RATIO OF EARNINGS TO FIXED CHARGES 16.00
12.81 11.02 12.42 16.75 15.62
</TABLE>
|Coopers |certified public
accountants
|&Lybrand
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
We are aware that our report dated July 30, 1993, on
our review
of interim condensed consolidated financial
information of
Minnesota Mining and Manufacturing Company and
subsidiaries for
the six-month period ended June 30, 1993, and
included in the
Form 10-Q for the period then ended, is incorporated by
reference
in the Company's registration statements on
Form S-8
(Registration Nos. 2-78422, 33-14791, 33-48690 and
33-49842), and
Form S-3 (Registration No. 33-48089). Pursuant to
Rule 436(c),
under the Securities Act of 1933, this report
should not be
considered a part of the registration statements
prepared or
certified by us within the meaning of Sections 7 and
11 of that
Act.
COOPERS & LYBRAND
St. Paul, Minnesota
August 9, 1993
<PAGE>
