3M Organic Sales Up 2.3% in Second Quarter - Modern Distribution Management

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3M Organic Sales Up 2.3% in Second Quarter

Sales for 3M's industrial business grew 6.6 percent in the quarter.
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Diversified manufacturer 3M (NYSE: MMM), St. Paul, MN, reported second-quarter sales of $7.8 billion, up 2.9 percent over the same period a year ago. Organic local-currency sales grew 2.3 percent. Profit increased 2.6 percent to $1.2 billion.

On a geographic basis, organic local-currency sales grew 8.5 percent in Latin America/Canada, 2.2 percent in Asia Pacific, 1.9 percent in EMEA (Europe, Middle East and Africa) and 0.8 percent in the U.S.

For the first half of 2013, sales were $15.4 billion, a year-over-year increase of 2.4 percent. Profit improved 1.5 percent to $2.3 billion.

Second-quarter sales in 3M's industrial business grew 6.6 percent to $2.7 billion. Organic local-currency sales increased 3.3 percent, acquisitions, including Ceradyne, added 4.6 percent to sales and foreign currency translation reduced sales by 1.3 percent.

On an organic local-currency basis, sales grew in most businesses led by aerospace, automotive aftermarket, liquid filtration, industrial adhesives and tapes and automotive OEM. Sales rose in all major geographies led by Latin America/Canada, the U.S. and EMEA.

Operating income was $599 million, up 1.2 percent year-on-year.

In the safety and graphics business, second-quarter sales of $1.5 billion were up 2.3 percent. Organic local-currency sales increased 2 percent; acquisitions, including Federal Signal Technologies, added 1.9 percent to sales and foreign currency translation reduced sales by 1.6 percent.

On an organic local-currency basis, sales growth was led by commercial graphics, personal safety, architectural markets and building and commercial services; sales declined in roofing granules and traffic safety and security systems. Sales grew in Latin America/Canada, Asia Pacific and EMEA and declined in the U.S.

Operating income was $333 million, down 9.7 percent year-on-year.

Electronics and energy sales decreased 3.2 percent to $1.3 billion in the second quarter. Organic local-currency sales decreased 2.1 percent and foreign currency translation reduced sales by 1.1 percent.

On an organic local-currency basis, electronics-related sales declined year-on-year as end-markets remained soft during the quarter.  Energy-related sales also declined year-on-year, as weakness in renewable energy more than offset sales gains in electrical markets.

Sales increased slightly in Latin America/Canada and declined in APAC, EMEA and the U.S.

Operating income was $237 million, down 16 percent year-on-year.

Health care sales of $1.3 billion were up 4.6 percent in the quarter. Organic local-currency sales increased 5.7 percent and foreign currency translation reduced sales by 1.1 percent.

On an organic local-currency basis, sales growth was strongest in health information systems, food safety, critical and chronic care, oral care and infection prevention; sales declined in drug delivery. Sales grew in all major geographies, with double-digit growth in Latin America/Canada and APAC.

Operating income increased 1.2 percent to $417 million.

Consumer sales of $1.1 billion were up 1.4 percent in U.S. dollars. Organic local-currency sales increased 2.9 percent. On an organic local-currency basis, sales growth was driven by the consumer health care, home care, stationery & office supplies and DIY businesses. Sales increased in all regions led by Latin America/Canada, Asia Pacific and the U.S.

Operating income grew 3.5 percent to $235 million.

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