Q4 2015 3 m earnings presentation

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  • 1. All Rights Reserved.26 January 2016© 3M 2015 Fourth Quarter Business Review January 26, 2016 (unaudited)
  • 2. All Rights Reserved.26 January 2016© 3M Forward Looking Statement This presentation contains forward-looking information about 3M's financial results and estimates and business prospects that involve substantial risks and uncertainties. You can identify these statements by the use of words such as "anticipate," "estimate,” "expect," “aim," "project," "intend," "plan," "believe," "will," “should," “could," "target," "forecast" and other words and terms of similar meaning in connection with any discussion of future operating or financial performance or business plans or prospects. Among the factors that could cause actual results to differ materially are the following: (1) worldwide economic and capital markets conditions and other factors beyond 3M's control, including natural and other disasters affecting the operations of 3M or its customers and suppliers; (2) 3M's credit ratings and its cost of capital; (3) competitive conditions and customer preferences; (4) foreign currency exchange rates and fluctuations in those rates; (5) the timing and market acceptance of new product offerings; (6) the availability and cost of purchased components, compounds, raw materials and energy (including oil and natural gas and their derivatives) due to shortages, increased demand or supply interruptions (including those caused by natural and other disasters and other events); (7) the impact of acquisitions, strategic alliances, divestitures, and other unusual events resulting from portfolio management actions and other evolving business strategies, and possible organizational restructuring; (8) generating fewer productivity improvements than estimated; (9) unanticipated problems or delays with the phased implementation of a global enterprise resource planning (ERP) system, or security breaches and other disruptions to 3M's information technology infrastructure; and (10) legal proceedings, including significant developments that could occur in the legal and regulatory proceedings described in 3M's Annual Report on Form 10-K for the year ended December 31, 2014, and its subsequent quarterly reports on Form 10-Q (the “Reports”). Changes in such assumptions or factors could produce significantly different results. A further description of these factors is located in the Reports under “Cautionary Note Concerning Factors That May Affect Future Results” and “Risk Factors” in Part I, Items 1 and 1A (Annual Report) and in Part I, Item 2 and Part II, Item 1A (Quarterly Report). The information contained in this presentation is as of the date indicated. 3M assumes no obligation to update any forward-looking statements contained in this presentation as a result of new information or future events or developments.
  • 3. All Rights Reserved.26 January 2016© 3M  GAAP EPS of $1.66, down 8.3% year-on-year  Excluding restructuring, EPS of $1.80, down 0.6% year-on-year  Sales of $7.3 billion, down 5.4% in dollar terms  Organic local currency declined 1.1%  Acquisitions, net of divestitures, increased sales by 1.5%  Foreign exchange translation (FX) reduced sales by 5.8%  Operating margins of 20.5%, down 100 basis points year-on-year  Excluding restructuring, operating margins of 22.1%, up 60 basis points  Returned $1.8 billion to shareholders via dividends and gross share repurchases Q4 2015 Summary Refer to 3M’s January 26, 2016 press release for full details.
  • 4. All Rights Reserved.26 January 2016© 3M  Organic local currency:  U.S. -0.4%  Asia Pacific -2.7%  China/Hong Kong -3%  Japan -3%  EMEA 1.1%  West Europe up slightly  Latin America/Canada -0.6%  Mexico +7%, Brazil -6%  FX reduced sales by 5.8%  Euro -13%, Yen -5%, Real -34% ($M) US APAC EMEA LAC Organic volume -1.0% -2.5% -0.8% -6.0% Price +0.6% -0.2% +1.9% +5.4% Organic local currency -0.4% -2.7% +1.1% -0.6% Acq/div +1.7% +0.7% +1.8% +1.3% FX ----- -4.2% -11.7% -18.6% Total growth +1.3% -6.2% -8.8% -17.9% Q4 2015 Sales Recap -5.4% -5.8% 1.5% -1.1% 1.2% -2.3% Total FX Acquisition/divestiture Organic local currency Price Organic volume Worldwide Sales Change Due To:
  • 5. All Rights Reserved.26 January 2016© 3M Q4 2015 Restructuring Q4 2015 ex-restructuring Pension/OPEB Strategic investments FX Organic volume Productivity/other Acquisitions, net of divestitures Price/raw materials Q4 2014 Operating margin of 20.5%, down 100 basis points; up 60 basis points excluding restructuring 0.0% ($M) Q4 2014 Q4 2015 Change Sales $7,719 $7,298 -5.4% Gross profit $3,692 $3,471 -6.0% % to sales 47.8% 47.5% -0.3 pts SG&A $1,594 $1,538 -3.5% % to sales 20.7% 21.1% +0.4 pts R&D & related $436 $433 -0.7% % to sales 5.6% 5.9% +0.3 pts Operating income $1,662 $1,500 -9.7% % to sales 21.5% 20.5% -1.0 pt Net income $1,179 $1,038 -12.0% GAAP earnings per share $1.81 $1.66 -8.3% 21.5% -0.3% -0.4% -0.6% 20.5% Refer to 3M’s January 26, 2016 press release for full details. Q4 2015 P&L -1.6% +0.1% +2.0% -0.2% 22.1%
  • 6. All Rights Reserved.26 January 2016© 3M $1.81 $1.66 Q4 2014 Q4 2015 -8.3% Q4 2014 GAAP EPS $1.81 Organic growth, margin expansion +$0.03  Includes headwinds of $0.05 from higher pension/OPEB expense and $0.04 from strategic investments Tax rate -$0.01  Q4 2015 28.6% (excluding restructuring)vs. Q4 2014 28.0% FX -$0.11  Pre-tax earnings impact of $96M Acquisitions and divestitures* +$0.02  Includes net impact from closed acquisitions and divestitures Shares outstanding +$0.06  Average diluted shares down 4% Q4 2015 ex-restructuring $1.80 Restructuring -$0.14  Pre-tax earnings impact of $114M Q4 2015 GAAP EPS $1.66 Q4 2015 GAAP EPS * Acquisitions include Capital Safety, Polypore’s Separations Media business; divestitures include Library Systems and license plate converting business in France
  • 7. All Rights Reserved.26 January 2016© 3M ($M) Q4 2014 Q4 2015 Change 2014 2015 Change Operating cash flow $2,183 $2,338 $155 $6,626 $6,420 ($206) Capital expenditures ($490) ($446) $44 ($1,493) ($1,461) $32  Expecting FY 2016 of $1.3B to $1.5B Free cash flow $1,693 $1,892 $199 $5,133 $4,959 ($174) Free cash flow conversion 144% 182% +38 pts 104% 103% -1 pt  Expecting FY 2016 of 95% to 105% Dividends $544 $628 $84 $2,216 $2,561 $345 Gross share repurchase $1,279 $1,134 ($145) $5,652 $5,238 ($414)  Expecting FY 2016 of $4B to $6B Total cash to shareholders $1,823 $1,762 ($61) $7,868 $7,799 ($69) Refer to 3M’s January 26, 2016 press release for full details. Q4 2015 Cash Flow
  • 8. All Rights Reserved.26 January 2016© 3M  Organic local currency growth:  By business: strong sales growth in 3M purification and automotive OEM was offset by declines in industrial adhesives and tapes, abrasives, and advanced materials  By area: sales grew in EMEA, Latin America/Canada and Asia Pacific, but declined in the U.S.  Automotive OEM business posted strong organic growth driven by increased market penetration  Polypore’s Separations Media acquisition integration on-track and meeting financial objectives; 50 basis points dilutive to margins ($M) Q4 2014 Q4 2015 % Growth Sales $2,627 $2,461 -6.3% Organic local currency -1.8% Acquisition/divestiture +1.7% FX -6.2% Operating income $538 $476 -11.6% Operating margin Ex-restructuring 20.5% 20.5% 19.3% 21.0% -1.2 pts +0.5 pts Industrial
  • 9. All Rights Reserved.26 January 2016© 3M  Organic local currency growth:  By business: sales grew in roofing granules and commercial solutions; traffic safety and security was flat; personal safety declined  By area: sales declined in Asia Pacific, the U.S., EMEA and Latin America/Canada  Commercial solutions selected by leading financial institution to supply films for re-imaging campaign  Capital Safety integration on-track and meeting profit expectations  Net acquisition/divestiture impact increased operating margins by 1.5 percentage points Safety & Graphics ($M) Q4 2014 Q4 2015 % Growth Sales $1,367 $1,294 -5.3% Organic local currency -2.5% Acquisition/divestiture +4.6% FX -7.4% Operating income $285 $282 -1.1% Operating margin Ex-restructuring 20.8% 20.8% 21.8% 22.7% +1.0 pt +1.9 pts
  • 10. All Rights Reserved.26 January 2016© 3M Health Care ($M) Q4 2014 Q4 2015 % Growth Sales $1,392 $1,381 -0.8% Organic local currency +4.5% Acquisition/divestiture +0.8% FX -6.1% Operating income $431 $444 +2.7% Operating margin Ex-restructuring 31.0% 31.0% 32.1% 32.8% +1.1 pts +1.8 pts  Organic local currency growth:  By business: sales grew in health information systems, food safety, oral care, drug delivery systems and critical and chronic care  By area: sales grew in all areas led by Asia Pacific, Latin America/Canada and EMEA  3M Hosted Sustainability in Health Care Summit; highlighted innovative best practices while showcasing 3M products and solutions for improving sustainability in hospitals  Continued strong growth in developing economies; particular strength in China/Hong Kong  Planning to reinvest benefit from suspension of medical device tax into our U.S. Health Care business
  • 11. All Rights Reserved.26 January 2016© 3M Electronics & Energy ($M) Q4 2014 Q4 2015 % Growth Sales $1,371 $1,210 -11.7% Organic local currency -7.7% Acquisition/divestiture -0.7% FX -3.3% Operating income $257 $200 -22.4% Operating margin Ex-restructuring 18.7% 18.7% 16.5% 17.5% -2.2 pts -1.2 pts  Organic local currency growth:  By business: electronic-related sales declined 8% (sales declined in electronics materials solutions and display materials and systems); energy-related sales declined 6% (sales declined in renewable energy, telecom and electrical markets)  By area: sales declined in the U.S., EMEA, Latin America/Canada and Asia Pacific  Launched joint development program with HP to combat visual hacking with integrated privacy solutions for notebook displays  Portfolio management actions (renewable energy) reduced Electronics & Energy margins by 2.4 percentage points
  • 12. All Rights Reserved.26 January 2016© 3M Consumer ($M) Q4 2014 Q4 2015 % Growth Sales $1,128 $1,101 -2.4% Organic local currency +2.7% Acquisition/divestiture ---- FX -5.1% Operating income $254 $254 +0.5% Operating margin Ex-restructuring 22.5% 22.5% 23.1% 23.4% +0.6 pts +0.9 pts  Organic local currency growth:  By business: sales grew in home improvement, stationery and office supplies, and home care; consumer health care declined  By area: sales grew in all areas led by the U.S., Asia Pacific and EMEA  Continued to expand presence in home furnace filter market with Filtrete™ brand  Strong holiday sales in Scotch® and Command™ products
  • 13. All Rights Reserved.26 January 2016© 3M 2015 Full-Year Performance  Solid financial results despite challenging external environment  Investing in the business: capital expenditures $1.5 billion, R&D $1.8 billion, acquisitions $3.7 billion  Significant progress on our three key levers: portfolio management, investing in innovation, business transformation  Completed corporate restructuring … further strengthening competiveness  Launched new brand platform … “3M Science. Applied to Life.™”  Returned $7.8 billion to shareholders via dividends and gross share repurchases  Delivered strong ROIC of 22.5% Refer to 3M’s January 26, 2016 press release for full details.
  • 14. All Rights Reserved.26 January 2016© 3M 2016 Planning Estimates  GAAP EPS of $8.10 to $8.45, up 7% to 11%  Sales growth  Organic local-currency growth of +1% to +3%  Foreign currency translation headwind of -1% to -3%  Acquisitions, net of divestitures, add approximately +1%  Tax rate of 29.5% to 30.5%  Free cash flow conversion of 95% to 105%
  • 15. All Rights Reserved.26 January 2016© 3M Q & A
  • 16. All Rights Reserved.26 January 2016© 3M s Appendix
  • 17. All Rights Reserved.26 January 2016© 3M Business Segment Information Net Sales Operating Income Net Sales Operating Income Business Groups Q4 2014 Q4 2015 Q4 2014 Q4 2015 2014 2015 2014 2015 Industrial $2,627 $2,461 $538 $476 $10,990 $10,328 $2,389 $2,263 Safety & Graphics $1,367 $1,294 $285 $282 $5,732 $5,515 $1,296 $1,305 Health Care $1,392 $1,381 $431 $444 $5,572 $5,420 $1,724 $1,724 Electronics & Energy $1,371 $1,210 $257 $200 $5,604 $5,220 $1,115 $1,102 Consumer $1,128 $1,101 $254 $254 $4,523 $4,422 $995 $1,046 Corporate and Unallocated ($1) $1 ($67) ($123) $4 $1 ($251) ($355) Elimination of Dual Credit ($165) ($150) ($36) ($33) ($604) ($632) ($133) ($139) Total $7,719 $7,298 $1,662 $1,500 $31,821 $30,274 $7,135 $6,946 2015 Fourth Quarter �Business Review Forward Looking Statement Q4 2015 Summary Q4 2015 Sales Recap Q4 2015 P&L Q4 2015 GAAP EPS Q4 2015 Cash Flow Industrial Safety & Graphics Health Care Electronics & Energy Consumer 2015 Full-Year Performance 2016 Planning Estimates Q & A Appendix Business Segment Information
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  • 1. All Rights Reserved.26 January 2016© 3M 2015 Fourth Quarter Business Review January 26, 2016 (unaudited)
  • 2. All Rights Reserved.26 January 2016© 3M Forward Looking Statement This presentation contains forward-looking information about 3M's financial results and estimates and business prospects that involve substantial risks and uncertainties. You can identify these statements by the use of words such as "anticipate," "estimate,” "expect," “aim," "project," "intend," "plan," "believe," "will," “should," “could," "target," "forecast" and other words and terms of similar meaning in connection with any discussion of future operating or financial performance or business plans or prospects. Among the factors that could cause actual results to differ materially are the following: (1) worldwide economic and capital markets conditions and other factors beyond 3M's control, including natural and other disasters affecting the operations of 3M or its customers and suppliers; (2) 3M's credit ratings and its cost of capital; (3) competitive conditions and customer preferences; (4) foreign currency exchange rates and fluctuations in those rates; (5) the timing and market acceptance of new product offerings; (6) the availability and cost of purchased components, compounds, raw materials and energy (including oil and natural gas and their derivatives) due to shortages, increased demand or supply interruptions (including those caused by natural and other disasters and other events); (7) the impact of acquisitions, strategic alliances, divestitures, and other unusual events resulting from portfolio management actions and other evolving business strategies, and possible organizational restructuring; (8) generating fewer productivity improvements than estimated; (9) unanticipated problems or delays with the phased implementation of a global enterprise resource planning (ERP) system, or security breaches and other disruptions to 3M's information technology infrastructure; and (10) legal proceedings, including significant developments that could occur in the legal and regulatory proceedings described in 3M's Annual Report on Form 10-K for the year ended December 31, 2014, and its subsequent quarterly reports on Form 10-Q (the “Reports”). Changes in such assumptions or factors could produce significantly different results. A further description of these factors is located in the Reports under “Cautionary Note Concerning Factors That May Affect Future Results” and “Risk Factors” in Part I, Items 1 and 1A (Annual Report) and in Part I, Item 2 and Part II, Item 1A (Quarterly Report). The information contained in this presentation is as of the date indicated. 3M assumes no obligation to update any forward-looking statements contained in this presentation as a result of new information or future events or developments.
  • 3. All Rights Reserved.26 January 2016© 3M  GAAP EPS of $1.66, down 8.3% year-on-year  Excluding restructuring, EPS of $1.80, down 0.6% year-on-year  Sales of $7.3 billion, down 5.4% in dollar terms  Organic local currency declined 1.1%  Acquisitions, net of divestitures, increased sales by 1.5%  Foreign exchange translation (FX) reduced sales by 5.8%  Operating margins of 20.5%, down 100 basis points year-on-year  Excluding restructuring, operating margins of 22.1%, up 60 basis points  Returned $1.8 billion to shareholders via dividends and gross share repurchases Q4 2015 Summary Refer to 3M’s January 26, 2016 press release for full details.
  • 4. All Rights Reserved.26 January 2016© 3M  Organic local currency:  U.S. -0.4%  Asia Pacific -2.7%  China/Hong Kong -3%  Japan -3%  EMEA 1.1%  West Europe up slightly  Latin America/Canada -0.6%  Mexico +7%, Brazil -6%  FX reduced sales by 5.8%  Euro -13%, Yen -5%, Real -34% ($M) US APAC EMEA LAC Organic volume -1.0% -2.5% -0.8% -6.0% Price +0.6% -0.2% +1.9% +5.4% Organic local currency -0.4% -2.7% +1.1% -0.6% Acq/div +1.7% +0.7% +1.8% +1.3% FX ----- -4.2% -11.7% -18.6% Total growth +1.3% -6.2% -8.8% -17.9% Q4 2015 Sales Recap -5.4% -5.8% 1.5% -1.1% 1.2% -2.3% Total FX Acquisition/divestiture Organic local currency Price Organic volume Worldwide Sales Change Due To:
  • 5. All Rights Reserved.26 January 2016© 3M Q4 2015 Restructuring Q4 2015 ex-restructuring Pension/OPEB Strategic investments FX Organic volume Productivity/other Acquisitions, net of divestitures Price/raw materials Q4 2014 Operating margin of 20.5%, down 100 basis points; up 60 basis points excluding restructuring 0.0% ($M) Q4 2014 Q4 2015 Change Sales $7,719 $7,298 -5.4% Gross profit $3,692 $3,471 -6.0% % to sales 47.8% 47.5% -0.3 pts SG&A $1,594 $1,538 -3.5% % to sales 20.7% 21.1% +0.4 pts R&D & related $436 $433 -0.7% % to sales 5.6% 5.9% +0.3 pts Operating income $1,662 $1,500 -9.7% % to sales 21.5% 20.5% -1.0 pt Net income $1,179 $1,038 -12.0% GAAP earnings per share $1.81 $1.66 -8.3% 21.5% -0.3% -0.4% -0.6% 20.5% Refer to 3M’s January 26, 2016 press release for full details. Q4 2015 P&L -1.6% +0.1% +2.0% -0.2% 22.1%
  • 6. All Rights Reserved.26 January 2016© 3M $1.81 $1.66 Q4 2014 Q4 2015 -8.3% Q4 2014 GAAP EPS $1.81 Organic growth, margin expansion +$0.03  Includes headwinds of $0.05 from higher pension/OPEB expense and $0.04 from strategic investments Tax rate -$0.01  Q4 2015 28.6% (excluding restructuring)vs. Q4 2014 28.0% FX -$0.11  Pre-tax earnings impact of $96M Acquisitions and divestitures* +$0.02  Includes net impact from closed acquisitions and divestitures Shares outstanding +$0.06  Average diluted shares down 4% Q4 2015 ex-restructuring $1.80 Restructuring -$0.14  Pre-tax earnings impact of $114M Q4 2015 GAAP EPS $1.66 Q4 2015 GAAP EPS * Acquisitions include Capital Safety, Polypore’s Separations Media business; divestitures include Library Systems and license plate converting business in France
  • 7. All Rights Reserved.26 January 2016© 3M ($M) Q4 2014 Q4 2015 Change 2014 2015 Change Operating cash flow $2,183 $2,338 $155 $6,626 $6,420 ($206) Capital expenditures ($490) ($446) $44 ($1,493) ($1,461) $32  Expecting FY 2016 of $1.3B to $1.5B Free cash flow $1,693 $1,892 $199 $5,133 $4,959 ($174) Free cash flow conversion 144% 182% +38 pts 104% 103% -1 pt  Expecting FY 2016 of 95% to 105% Dividends $544 $628 $84 $2,216 $2,561 $345 Gross share repurchase $1,279 $1,134 ($145) $5,652 $5,238 ($414)  Expecting FY 2016 of $4B to $6B Total cash to shareholders $1,823 $1,762 ($61) $7,868 $7,799 ($69) Refer to 3M’s January 26, 2016 press release for full details. Q4 2015 Cash Flow
  • 8. All Rights Reserved.26 January 2016© 3M  Organic local currency growth:  By business: strong sales growth in 3M purification and automotive OEM was offset by declines in industrial adhesives and tapes, abrasives, and advanced materials  By area: sales grew in EMEA, Latin America/Canada and Asia Pacific, but declined in the U.S.  Automotive OEM business posted strong organic growth driven by increased market penetration  Polypore’s Separations Media acquisition integration on-track and meeting financial objectives; 50 basis points dilutive to margins ($M) Q4 2014 Q4 2015 % Growth Sales $2,627 $2,461 -6.3% Organic local currency -1.8% Acquisition/divestiture +1.7% FX -6.2% Operating income $538 $476 -11.6% Operating margin Ex-restructuring 20.5% 20.5% 19.3% 21.0% -1.2 pts +0.5 pts Industrial
  • 9. All Rights Reserved.26 January 2016© 3M  Organic local currency growth:  By business: sales grew in roofing granules and commercial solutions; traffic safety and security was flat; personal safety declined  By area: sales declined in Asia Pacific, the U.S., EMEA and Latin America/Canada  Commercial solutions selected by leading financial institution to supply films for re-imaging campaign  Capital Safety integration on-track and meeting profit expectations  Net acquisition/divestiture impact increased operating margins by 1.5 percentage points Safety & Graphics ($M) Q4 2014 Q4 2015 % Growth Sales $1,367 $1,294 -5.3% Organic local currency -2.5% Acquisition/divestiture +4.6% FX -7.4% Operating income $285 $282 -1.1% Operating margin Ex-restructuring 20.8% 20.8% 21.8% 22.7% +1.0 pt +1.9 pts
  • 10. All Rights Reserved.26 January 2016© 3M Health Care ($M) Q4 2014 Q4 2015 % Growth Sales $1,392 $1,381 -0.8% Organic local currency +4.5% Acquisition/divestiture +0.8% FX -6.1% Operating income $431 $444 +2.7% Operating margin Ex-restructuring 31.0% 31.0% 32.1% 32.8% +1.1 pts +1.8 pts  Organic local currency growth:  By business: sales grew in health information systems, food safety, oral care, drug delivery systems and critical and chronic care  By area: sales grew in all areas led by Asia Pacific, Latin America/Canada and EMEA  3M Hosted Sustainability in Health Care Summit; highlighted innovative best practices while showcasing 3M products and solutions for improving sustainability in hospitals  Continued strong growth in developing economies; particular strength in China/Hong Kong  Planning to reinvest benefit from suspension of medical device tax into our U.S. Health Care business
  • 11. All Rights Reserved.26 January 2016© 3M Electronics & Energy ($M) Q4 2014 Q4 2015 % Growth Sales $1,371 $1,210 -11.7% Organic local currency -7.7% Acquisition/divestiture -0.7% FX -3.3% Operating income $257 $200 -22.4% Operating margin Ex-restructuring 18.7% 18.7% 16.5% 17.5% -2.2 pts -1.2 pts  Organic local currency growth:  By business: electronic-related sales declined 8% (sales declined in electronics materials solutions and display materials and systems); energy-related sales declined 6% (sales declined in renewable energy, telecom and electrical markets)  By area: sales declined in the U.S., EMEA, Latin America/Canada and Asia Pacific  Launched joint development program with HP to combat visual hacking with integrated privacy solutions for notebook displays  Portfolio management actions (renewable energy) reduced Electronics & Energy margins by 2.4 percentage points
  • 12. All Rights Reserved.26 January 2016© 3M Consumer ($M) Q4 2014 Q4 2015 % Growth Sales $1,128 $1,101 -2.4% Organic local currency +2.7% Acquisition/divestiture ---- FX -5.1% Operating income $254 $254 +0.5% Operating margin Ex-restructuring 22.5% 22.5% 23.1% 23.4% +0.6 pts +0.9 pts  Organic local currency growth:  By business: sales grew in home improvement, stationery and office supplies, and home care; consumer health care declined  By area: sales grew in all areas led by the U.S., Asia Pacific and EMEA  Continued to expand presence in home furnace filter market with Filtrete™ brand  Strong holiday sales in Scotch® and Command™ products
  • 13. All Rights Reserved.26 January 2016© 3M 2015 Full-Year Performance  Solid financial results despite challenging external environment  Investing in the business: capital expenditures $1.5 billion, R&D $1.8 billion, acquisitions $3.7 billion  Significant progress on our three key levers: portfolio management, investing in innovation, business transformation  Completed corporate restructuring … further strengthening competiveness  Launched new brand platform … “3M Science. Applied to Life.™”  Returned $7.8 billion to shareholders via dividends and gross share repurchases  Delivered strong ROIC of 22.5% Refer to 3M’s January 26, 2016 press release for full details.
  • 14. All Rights Reserved.26 January 2016© 3M 2016 Planning Estimates  GAAP EPS of $8.10 to $8.45, up 7% to 11%  Sales growth  Organic local-currency growth of +1% to +3%  Foreign currency translation headwind of -1% to -3%  Acquisitions, net of divestitures, add approximately +1%  Tax rate of 29.5% to 30.5%  Free cash flow conversion of 95% to 105%
  • 15. All Rights Reserved.26 January 2016© 3M Q & A
  • 16. All Rights Reserved.26 January 2016© 3M s Appendix
  • 17. All Rights Reserved.26 January 2016© 3M Business Segment Information Net Sales Operating Income Net Sales Operating Income Business Groups Q4 2014 Q4 2015 Q4 2014 Q4 2015 2014 2015 2014 2015 Industrial $2,627 $2,461 $538 $476 $10,990 $10,328 $2,389 $2,263 Safety & Graphics $1,367 $1,294 $285 $282 $5,732 $5,515 $1,296 $1,305 Health Care $1,392 $1,381 $431 $444 $5,572 $5,420 $1,724 $1,724 Electronics & Energy $1,371 $1,210 $257 $200 $5,604 $5,220 $1,115 $1,102 Consumer $1,128 $1,101 $254 $254 $4,523 $4,422 $995 $1,046 Corporate and Unallocated ($1) $1 ($67) ($123) $4 $1 ($251) ($355) Elimination of Dual Credit ($165) ($150) ($36) ($33) ($604) ($632) ($133) ($139) Total $7,719 $7,298 $1,662 $1,500 $31,821 $30,274 $7,135 $6,946 2015 Fourth Quarter �Business Review Forward Looking Statement Q4 2015 Summary Q4 2015 Sales Recap Q4 2015 P&L Q4 2015 GAAP EPS Q4 2015 Cash Flow Industrial Safety & Graphics Health Care Electronics & Energy Consumer 2015 Full-Year Performance 2016 Planning Estimates Q & A Appendix Business Segment Information
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