3M Safety & Industrial Sales Slid 1.7% in 1Q - Modern Distribution Management

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3M Safety & Industrial Sales Slid 1.7% in 1Q

The company's largest segment saw organic sales fall 1.5% in the Americas, though operating profit saw a healthy improvement.
An expert says lawsuits filed by veterans who blame hearing issues on defective earplugs could bankrupt the company, but 3M calls the interpretation ‘flawed speculation,’ according to Bloomberg.

Manufacturing conglomerate 3M reported its 2024 first quarter financial results on April 30 — its final such quarter that included its health care segment, which was officially divested on April 1.

The company posted total 1Q sales of $8.0 billion, down 0.3% year-over-year, with flat organic sales (-1.5% in Americas). Adjusted sales of $7.7 billion were up 0.5% year-over-year, with organic sales up 0.8%.

3M’s 1Q operating profit of $1.50 billion topped the $1.24 billion of a year earlier, while net profit of $928 million fell approximately 5% year-over-year

On May 1, Bill Brown takes the reins as 3M CEO, succeeding Mike Roman, who will remain on the company’s board of directors.

Excluding its health care unit that is now discontinued (now known as Solventum), here’s how 3M’s 1Q performed within its three business units going forward:

  • Safety & Industrial — Sales of $2.732 billion (34% of total) fell approximately 1.7% year-over-year, with organic sales down 1.4%. Operating profit of $657 increased 9.3%.
  • Transportation & Electronics — Sales of $2.104 billion (26% of total) increased approximately 2.6% year-over-year, with organic sales up 2.7%. Operating profit jumped 63.6%.
  • Consumer — Sales of $1.140 billion (14% of total) fell approximately 4.3% year-over-year, with organic sales down 3.9%. Operating profit increased 20.7%.

3M’s former health care unit represented about 25% of the company’s revenue and profit during 2023.

“We delivered results that were better than our expectations as we returned to organic growth and achieved double digit adjusted earnings growth,” Roman said in the company’s financial news release. “We improved performance in our businesses through strong operational execution, completed the spin-off of Solventum, and finalized two major legal settlements.”

Adjusting for the Solventum spin-off, 3M forecasts 2024 full-year total sales growth of 0.25% to 1.75%, with organic sales ranging flat to +2%.

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