3M Company (MMM - Get Report) posted modestly better than-expected fourth quarter earnings Tuesday but trimmed its 2019 profit guidance and said it was positioned for a "successful 2019" despite increasing concerns over global demand linked to a slowdown in China.
3M said earnings for the three months ending in December came in at $2.27 per share, up 8% from the same period last year. Adjusted earnings of $2.31, however, topped the consensus forecast of $2.28. Group sales, 3M said, slipped 1.2% to $7.9 billion but were just ahead of the $7.86 billion estimate.
3M said it sees full year 2019 earnings in the range of $10.45 to $10.90, largely in-line with the Refinitiv forecast of $10.74, but lower than the $10.60 to $11.05 range it issued late last year. 3M also kept its organic, local-currency revenue growth forecasts unchanged at a range of 1% to 4%.
"3M executed well in the fourth quarter, with results that were in line with our expectations. We delivered organic growth of 3 percent - which included growth across all business groups and geographic areas - along with strong cash flow and earnings," ," said CEO Mike Roman. "The fourth quarter capped an important year for 3M, as we posted good results and continued to take actions to strengthen our company for the future."
"Going forward, our team remains focused on executing our four priorities - Portfolio, Transformation, Innovation, and People & Culture - which are keys to growth and value creation," Roman added. "We are positioned for a successful 2019, and are focused on delivering for our customers and shareholders."
3M shares gained 1.9% during trading Tuesday to close at $196.95, taking the stock's three-month gain to about 4.4%.
3M said in November that it has a five-year plan to boost shareholder returns after investors punished the stock after the company missed third-quarter profit estimates in October.
3M said at the time it sees a 22% to 25% return on invested capital, a figure it confirmed today, and 2% to 4% organic sales growth when measured in U.S. dollars.
"As we work to deliver a strong close to 2018, we are positioning our company for success in 2019 and beyond - which includes taking actions around our four priorities," said CEO Mike Roman. "Our team is focused on growth, operational execution, and delivering for our customers and shareholders."
3M's new five-year financial objectives, which extend through 2023, include organic local currency sales growth of between 3% and 5%, adjusted earnings growth of between 8% and 11%, a 20% return on invested capital and a 100% free-cash flow conversion rate.