first-quarter earnings easily beat Wall Street forecasts Friday as the company reported its highest quarterly revenue ever and all of its product categories yielded sales gains.
3M earned $899 million, or $1.17 a share, in the quarter, up 17% from $771 million, or 97 cents a share, a year ago. Analysts surveyed by Thomson First Call were forecasting earnings of $1.14 a share in the most recent quarter, although the Reuters Research estimate was for earnings of $1.16 a share.
First-quarter sales rose 8.3% to $5.60 billion, beating the Thomson First Call consensus estimate of $5.58 billion. 3M said local-currency sales rose 10.4%, with a little less than a quarter of that gain coming from acquisitions.
By segment, local currency sales growth was 15.6% in the company's safety, security and protection segment; 14% in its industrial and transportation segment; 10.6% in electro and communications; 9.5% in display and graphics; 8.4% in consumer and office; and 4.9% in health care.
In the second quarter, 3M expects to earn $1.14 to $1.17 a share on local-currency sales growth of 5% to 8% from a year ago. Analysts were forecasting earnings of $1.15 a share on sales of $5.7 billion, according to Thomson First Call.
For 2006, 3M sees earnings of $4.55 to $4.65 a share, up from its previous estimate of $4.45 to $4.60 a share. Analysts were pegging $4.61 a share. The company put full-year organic, local-currency sales growth at 5.5% to 8%, up from its old forecast of 4% to 7%.
"This was an outstanding quarter for 3M, characterized by broad-based growth from our entire portfolio and continued strong leverage to the bottom line," 3M said. "Quarterly sales reached an all-time high with local-currency growth of over 10%, and we delivered a double-digit net income increase while also investing for the future."
"Looking ahead, we expect continued strong sales and earnings growth through the rest of 2006," said CEO George Buckley. "For the longer term, I see tremendous opportunity for the people of 3M to transform our many strengths -- innovative technology and products, broad geographic presence and capability, and established positions in many fast growth end-markets -- into even greater sustainable growth."