Shares of 3M Co. (NYSE:MMM) lost nearly 6 percent today after the conglomerate reported a 1.6 percent profit slide for the third quarter and slashed its sales and earnings guidance for 2011.
3M reported profits of $1.09 billion, or $1.52 per share, on sales of $7.53 billion. That’s a top-line increase of 9.6 percent compared with Q3 2010. Wall Street analysts expected $1.61 per share for the latest quarter.
MMM shares were down to $77.37 as of about 1:50 p.m. today, after opening at $76.88.
"The business environment remains challenging, as the economic softening that we experienced late in the second quarter continued into the third," chairman, president & CEO George Buckley said in prepared remarks (PDF). "Looking ahead, early evidence suggests slower growth will persist through year end, therefore we are responding to lower demand with aggressive cost management and operational discipline in developed economies. At the same time, we are bullish on many developing economies and plan to maintain key investments in R&D, sales and manufacturing to capitalize on underlying strength in those regions."
But the potential souring of the global economy still prompted 3M to cut its sales and earnings forecasts for the full year. The company now expects earnings of between $5.85 and $5.95 per share, down from $6.10 to $6.25. Sales growth is now pegged at 3 percent to 4 percent, rather than 6 percent to 7.5 percent.
The Minneapolis-area company’s health products arm, 3M Healthcare, did its part to buck the slide, contributing sales growth of 14.1 percent and operating profits of 12.9 percent. 3M Healthcare logged operating profits of $367 million on sales of $1.25 billion during the three months ended Sept. 30, compared with $325 million on sales of $1.09 billion during the same period last year.
The division’s sales grew at a double-digit clip across the globe during the quarter:
- Asia Pacific: +20%
- Latin America/Canada: +16%
- Europe: +13%
- U.S.: +12%