3M (NYSE:MMM) today told investors that it is projecting single-digit growth for the 2022 fiscal year as respirator mask demand slows.
The Maplewood, Minnesota-based manufacturing and material science giant said in its Virtual Strategic Update that it expects organic sales growth in the range of 2% to 5% for this fiscal year. It estimates earnings to be in the range of $10.15 to $10.65 per share. 3M’s healthcare segment expects organic sales growth to be in the “mid-single digits” for the year.
With more relaxed COVID-19 guidelines across the country, 3M forecasts that the reduced demand of disposable face masks will reduce its annual earnings per share by an estimated 45¢, or a 2% loss in organic sales growth. 3M assumes Q1 2022 will have a lower pandemic-related disposable respiratory demand of $100 million to $150 million year-on-year.
The company has been on the frontlines of combatting the COVID-19 pandemic by providing essential personal protective equipment like face masks. It grew its monthly mask manufacturing capabilities from 22 million masks in December 2019 to more than 95 million per month by the end of 2020.
3M said it plans to prioritize large, fast-growing commercial markets in its 2022 growth strategy, including innovations in its wound care and healthcare IT segments through the two 2019 acquisitions of Acelity and M*Modal.
“3M is powered by purpose, unlocking the power of people, ideas, and science, to re-imagine what’s possible and create what’s next,” CEO and Chair Mike Roman said. “We are well-positioned for 2022 and beyond because of our customer-inspired innovation, industry-leading businesses, fundamental strengths, and world-class capabilities enabling us to win in fast-growing markets.”
The company plans to grow its wound care business following the $6.7 billion purchase of wound care giant Acelity in October 2019. 3M notes that the wound care market is projected to be a $20 billion market by the end of fiscal year 2024 to represent a 6-8% growth.
To represent healthcare IT innovation, 3M acquired M*Modal in Q1 of 2019 in a $700 million acquisition of cloud-based, artificial intelligence-powered healthcare technology maker M*Model. The healthcare IT market is estimated to be worth $40 billion with a 7-14% growth by the end of fiscal year 2024.
MMM shares were down more than 1% at $157.83 apiece near the close of trading today, similar to the performance of MassDevice and MDO‘s MedTech 100 Index.