EXHIBIT 99
Investor Contacts: Jon Greer Media Contact: John Cornwell
651-736-1915 651-733-7698
[email protected] [email protected]
Matt Ginter
651-733-8206
[email protected]
FOR IMMEDIATE RELEASE
3M Reports Record Second-Quarter, First-Half
Sales and Profits*
Q2 EPS up 14.6% on 12% volume increase
ST. PAUL, Minn. - July 26, 2000 - 3M today reported record second-
quarter earnings of $1.18 per share, an increase of 14.6 percent
from the same quarter of 1999. Net income reached $470 million,
up from $421 million in the year-earlier quarter.
Operating income was 18.4 percent of sales, up from 18.1 percent
of sales in the second quarter last year. Net income was 11.1 percent
of sales, compared with 10.9 percent of sales in the year-earlier
quarter.
Sales totaled $4.224 billion, an increase of more than 9 percent
in U.S. dollars and more than 10 percent in local currencies.
"We continue to deliver solid growth," said L. D. DeSimone,
chairman and chief executive officer. "We're growing through a strong
flow of innovative products, increasing participation in dynamic
industries and our strong global presence. Solid productivity gains
also continued to contribute to our financial performance.
"Our Electro Communications businesses continued to register
strong growth," DeSimone said. "We also saw solid gains in our
Consumer and Office and our Transportation, Graphics and Safety
segments."
3M posted double-digit local-currency sales gains in Europe, the
Asia Pacific area and Latin America, driven by new products and
improving economies.
For the first six months of 2000, earnings totaled $2.31 per
share, an increase of 16.7 percent from the first half last year. Net
income totaled $926 million, up from $805 million in the comparable
period. Operating income was 18.6 percent of sales, up about a full
percentage point from the first six months last year.
Sales totaled $8.276 billion, an increase of more than 8 percent
in U.S. dollars and more than 9 percent in local currencies from the
year-earlier period.
"Our diversity of products, markets and geographic participation
is a major strength," DeSimone said. "It gives us many avenues for
growth, while cushioning us from disruptions in any single market or
region of the world.
"Looking ahead, we remain confident about our prospects," he
said. "Our businesses are leaders in their markets, and we expect to
continue to register solid growth, driven by new products, our
increasing participation in fast-growing industries, strong
relationships with customers and our worldwide presence."
* This news release discussion excludes non-recurring items in all
periods. Second-quarter 1999 net income of $421 million and first six
months 1999 net income of $805 million exclude gains on divestitures,
net of an investment valuation adjustment, of $104 million ($55
million, or 14 cents per share, after tax). For the first six months
of 2000, net income of $926 million excludes a $50 million benefit
($31 million, or 8 cents per share, after tax) related to the
termination of a marketing agreement in the company's health care
business.
Forward-Looking Statements
Certain portions of this news release that do not relate to historical
financial information constitute forward-looking statements. These
forward-looking statements are subject to certain risks and
uncertainties. Actual future results and trends may differ materially
from historical results or those expected depending on a variety of
factors, including: (1) worldwide economic conditions; (2) foreign
exchange rates and fluctuations in those rates; (3) the timing and
acceptance of new product offerings; (4) raw materials, including
shortages and increases in the costs of key raw materials; (5) our
ability to successfully manage acquisitions, divestitures and
strategic alliances; and (6) legal proceedings.
# # #
About 3M
3M is a $16 billion technology company with leading positions in
electronics, telecommunications, industrial, consumer and office,
health care, safety and other markets. Headquartered in St. Paul,
Minnesota, the company has operations in more than 60 countries and
serves customers in nearly 200 countries. 3M businesses share
technologies, manufacturing operations, brands, marketing channels and
other important resources. 3M is one of the 30 stocks that make up the
Dow Jones Industrial Average and also is a component of the Standard &
Poor's 500 Index. Additional information about the company is
available on the Internet at www.3M.com.
<TABLE>
Minnesota Mining and Manufacturing Company and Subsidiaries
(Unaudited)
Sales Change Analysis
Second-Quarter 2000
<CAPTION>
U.S. International Worldwide
<S> <C> <C> <C>
Volume 7% 18% 12%
Price (1) (2) (2)
Translation -- (3) (1)
=== === ===
Total 6% 13% 9%
____________________________________________________________________
</TABLE>
<TABLE>
Sales Change Analysis
First-Half 2000
<CAPTION>
U.S. International Worldwide
<S> <C> <C> <C>
Volume 7% 15% 11%
Price (1) (2) (2)
Translation -- (3) (1)
=== === ===
Total 6% 10% 8%
</TABLE>
<TABLE>
Minnesota Mining and Manufacturing Company and Subsidiaries
CONSOLIDATED STATEMENT OF INCOME (Unaudited)
<CAPTION>
3 Months Ended 6 Months Ended
June 30 June 30
(Amounts in millions,
except per-share amounts) 2000 1999 2000 1999
<S> <C> <C> <C> <C>
Net sales $4,224 $3,863 $8,276 $7,639
Operating expenses
Cost of goods sold 2,379 2,188 4,645 4,350
Selling, general and
administrative expenses 1,068 975 2,089 1,940
Other -- (104) (50) (104)
------ ------ ------ ------
Total 3,447 3,059 6,684 6,186
------ ------ ------ ------
Operating income 777 804 1,592 1,453
------ ------ ------ ------
Other income and expense
Interest expense 26 26 52 57
Investment and other
income -- net (6) (7) (12) (15)
------ ------ ------ ------
Total 20 19 40 42
------ ------ ------ ------
Income before income taxes
and minority interest 757 785 1,552 1,411
Provision for income taxes 265 291 547 516
Minority interest 22 18 48 35
------ ------ ------ ------
Net income $ 470 $ 476 $ 957 $ 860
====== ====== ====== ======
Weighted average common shares
outstanding -- basic 395.6 403.2 396.6 402.8
Earnings per share -- basic $ 1.19 $ 1.18 $ 2.41 $ 2.14
====== ====== ====== ======
Weighted average common shares
outstanding -- diluted 399.2 407.4 400.5 406.5
Earnings per share -- diluted $ 1.18 $ 1.17 $ 2.39 $ 2.12
====== ====== ====== ======
</TABLE>
<TABLE>
Minnesota Mining and Manufacturing Company and Subsidiaries
SUPPLEMENTAL CONSOLIDATED STATEMENT OF INCOME INFORMATION (Unaudited)
(Amounts in millions, except per-share amounts)
<CAPTION>
3 Months Ended 3 Months Ended
June 30, 2000 June 30, 1999
Excluding
Non- Non-
Reported recurring recurring Reported
Total Items Items Total
<S> <C> <C> <C> <C>
Operating income $ 777 $ 700 $ 104 $ 804
Other expense $ 20 $ 19 -- $ 19
Income before income taxes
and minority interest $ 757 $ 681 $ 104 $ 785
Provision for income taxes $ 265 $ 242 $ 49 $ 291
Effective tax rate 35.0% 35.5% 46.9% 37.0%
Minority interest $ 22 $ 18 -- $ 18
Net income $ 470 $ 421 $ 55 $ 476
Per share -- diluted $1.18 $1.03 $0.14 $1.17
</TABLE>
<TABLE>
<CAPTION>
6 Months Ended 6 Months Ended
June 30, 2000 June 30, 1999
Excluding Excluding
Non- Non- Non- Non-
recurring recurring Reported recurring recurring Reported
Items Items Total Items Items Total
<S> <C> <C> <C> <C> <C> <C>
Operating income $1,542 $ 50 $1,592 $1,349 $ 104 $1,453
Other expense $ 40 -- $ 40 $ 42 -- $ 42
Income before
income taxes and
minority interest $1,502 $ 50 $1,552 $1,307 $ 104 $1,411
Provision for
income taxes $ 528 $ 19 $ 547 $ 467 $ 49 $ 516
Effective tax rate 35.2% 38.0% 35.3% 35.7% 46.9% 36.6%
Minority interest $ 48 -- $ 48 $ 35 -- $ 35
Net income $ 926 $ 31 $ 957 $ 805 $ 55 $ 860
Per share -- diluted $ 2.31 $0.08 $ 2.39 $ 1.98 $0.14 $ 2.12
</TABLE>
<TABLE>
Minnesota Mining and Manufacturing Company and Subsidiaries
CONSOLIDATED BALANCE SHEET (Unaudited)
<CAPTION>
June 30 Dec. 31
(Dollars in millions) 2000 1999
<S> <C> <C>
Assets
Current assets
Cash and cash equivalents $ 420 $ 387
Other securities 16 54
Accounts receivable -- net 3,009 2,778
Inventories 2,252 2,030
Other current assets 1,057 817
------- -------
Total current assets 6,754 6,066
Property, plant and equipment -- net 5,710 5,656
Investments and other assets 2,469 2,174
------- -------
Total $14,933 $13,896
======= =======
------------------------------------------------------------
Liabilities and Stockholders' Equity
Current liabilities
Short-term debt $ 1,871 $ 1,130
Other current liabilities 3,103 2,689
------- -------
Total current liabilities 4,974 3,819
Long-term debt 1,193 1,480
Other liabilities 2,343 2,308
Stockholders' equity -- net 6,423 6,289
Shares outstanding
June 30, 2000: 395,291,674 shares
Dec. 31, 1999: 398,710,817 shares
------- -------
Total $14,933 $13,896
======= =======
</TABLE>
Minnesota Mining and Manufacturing Company and Subsidiaries
BUSINESS SEGMENTS (Unaudited)
In the first quarter of 2000, business segment operating income for
1999 was restated for minor amounts, to be consistent with year 2000
management reporting practices. Certain costs previously included in
Corporate and Unallocated were allocated to the individual business
segments. 3M net sales and operating income by segment follow.
<TABLE>
<CAPTION>
Business
Segment Six Six Second Second First First
Information Months Months Qtr Qtr Qtr Qtr
(Millions) 2000 1999 2000 1999 2000 1999
<S> <C> <C> <C> <C> <C> <C>
Net sales
Industrial $1,784 $1,678 $ 873 $ 836 $ 911 $ 842
Transportation,
Graphics and Safety 1,784 1,583 912 806 872 777
Health Care 1,559 1,561 794 793 765 768
Consumer and Office 1,379 1,276 692 638 687 638
Electro and
Communications 1,147 927 642 485 505 442
Specialty Material 607 584 302 292 305 292
Corporate and
Unallocated 16 30 9 13 7 17
Total Company $8,276 $7,639 $4,224 $3,863 $4,052 $3,776
Operating income
Industrial $ 338 $ 302 $ 153 $ 154 $ 185 $ 148
Transportation,
Graphics and Safety 422 319 213 171 209 148
Health Care 351 338 158 194 193 144
Consumer and Office 207 183 102 95 105 88
Electro and
Communications 194 172 105 90 89 82
Specialty Material 108 115 57 60 51 55
Corporate and
Unallocated (28) 24 (11) 40 (17) (16)
Total Company $1,592 $1,453 $ 777 $ 804 $ 815 $ 649
</TABLE>
First quarter 2000 operating income includes a $50 million benefit
relating to the termination of a product distribution agreement in the Health
Care segment. Second quarter 1999 operating income includes gains on
divestitures, net of an investment valuation adjustment, of $30
million in Health Care and $74 million in Corporate and Unallocated.
