) reported strong fourth quarter 2012 results with a net income
of $991 million or $1.41 per share compared to $954 million or
$1.35 in the year-earlier quarter. The reported earnings were in
sync with the Zacks Consensus Estimate.
For full year 2012, the company reported a net income of $4.4
billion or $6.32 per share compared to $4.3 billion or $5.96 in
the prior year. Reported earnings for full year 2012 were in line
with the Zacks Consensus Estimate.
Total sales in the reported quarter increased 4.2% year over year
to $7.4 billion, which was an all-time fourth-quarter record for
the company. Total sales for fourth quarter 2012 exceeded the
Zacks Consensus Estimate of $7.2 billion.
The record quarterly sales were led by improved performance by
almost all the segments, except Safety, Security and Protection
Services segment, which reported a negative top-line growth. The
company also reported solid sales across all geographic regions,
except EMEA (Europe, Middle East and Africa).
For full year 2012, 3M reported record total sales of $29.9
billion compared to $29.6 billion in 2011. The company witnessed
full-year organic local-currency growth in four of its six
business segments. On a geographic basis, Latin America/Canada
was the fastest-growing region.
Industrial and Transportation
segment sales increased 3.8% in U.S. dollars to $2.5 billion
driven by a spurt in sales in Latin America/Canada, the U.S. and
Asia Pacific. Organic local-currency sales increased 3.9% year
over year due to strong sales in liquid filtration, aerospace,
industrial adhesives and tapes, abrasives and automotive OEM.
segment sales surged 5.6% in U.S. dollars to $1.3 billion, aided
by positive growth in all major geographic regions. Organic
local-currency sales increased 5.9% year over year with a healthy
growth across all business lines, the strongest being food
safety, health information systems, skin/wound care and oral
Consumer and Office
segment revenue was $1.1 billion, up 7.7% year over year in U.S.
dollars as sales increased in all major geographic regions.
Organic local-currency sales growth of 8.7% was attributable to
consumer health care, DIY and stationery and office supply
Display and Graphics
segment sales rose 10.6% year over year in U.S. dollars to $910
million with a strong performance in Asia Pacific, Latin
America/Canada and the U.S. Organic local-currency sales growth
of 8.3% benefited from architectural markets, optical system,
traffic safety systems and commercial graphics.
Safety, Security and Protection Services
segment revenue decreased 2.5% in U.S. dollars to $904 million as
sales declined in the U.S. and EMEA. On an organic local-currency
basis, sales dipped 1.7% led by a dismal performance in security
Electro and Communication
s segment revenue was $776 million, up 1% in U.S. dollars as
sales increased in Latin America/Canada, the U.S. and Asia
Pacific. Organic local-currency sales increased 1.8% due to
healthy performances in both electrical and telecom markets.
Balance Sheet and Cash Flow
Cash and cash equivalents at year-end 2012 were $2.9 billion
compared to $2.2 billion in the year-ago period. Long-term debt
at year-end 2012 increased to $4.9 billion from $4.5 billion in
the previous year.
Free cash flow for the three-month period was relatively
stable at $1.2 billion compared to the year-ago period. However,
on a twelve-month basis, it decreased marginally to $3.8 billion
from $3.9 billion at year-end 2011.
BROADCOM CORP-A (BRCM): Free Stock Analysis
3M CO (MMM): Free Stock Analysis Report
QLOGIC CORP (QLGC): Free Stock Analysis
TYCO INTL LTD (TYC): Free Stock Analysis
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The company reiterated its earlier guidance for full year 2013 in
the range of $6.70 to $6.95 per share with an organic
local-currency sales growth of 2%-5%.
3M has been continuously upgrading its product portfolio to fight
against stiff competition from leading players such as
). We also remain encouraged by the record top-line growth of the
company and expect it to continue its bull run in the coming
3M currently has a Zacks Rank #3 (Hold). However, we have a Zacks
Rank #2 (Buy) for
Tyco International Ltd.
), one of the peers of 3M.