3M 2004 Annual Report Download - page 51

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25
The strong 2003 local-currency sales growth in the Display and Graphics segment was primarily due to optical systems
growth, including the Corning Precision Lens acquisition that benefited sales by approximately 11%. Optical systems
growth was led by sales of display enhancement films used in flat-panel devices. Geographic area local-currency sales
growth was led by the Asia Pacific area and the Latin America, Africa and Canada area. Local-currency growth was
moderate in the United States and Europe. Operating income increased 65.8% to $885 million in 2003, driven primarily
by local-currency sales growth, production facilities running at high utilization levels and benefits from 3M’s corporate
initiatives.
Consumer and Office Business (14.3% of consolidated sales):
2004 2003 2002
Sales (millions) $2,861 $2,607 $2,444
Sales change analysis:
Local currency (volume and price) 6.9% 2.6% (3.7)%
Translation 2.8 4.1 0.5
Total sales change 9.7% 6.7% (3.2)%
Operating income (millions) $ 542 $ 460 $ 448
Percent change 17.9% 2.5% 9.3%
Percent of sales 18.9% 17.6% 18.3%
The Consumer and Office segment serves markets that include consumer retail, office retail, education, home
improvement, building maintenance and other markets. Products in this segment include office supply products,
stationery products, construction and home improvement/home care products, protective material products, and visual
systems products.
In 2004, local-currency sales growth in Consumer and Office was 6.9%. Sales growth was fairly broad-based across
the many retail channels 3M serves, most notably in mass-market consumer retail and home improvement. This
included strong sales growth in construction and home improvement/home care products, office supply products and
stationery products. Geographic area local-currency growth was led by the United States. Operating income increased
17.9% to $542 million in 2004.
2003 local-currency growth was led by the construction and home improvement, home care, and stationery products
businesses, partially offset by lower local-currency sales in the visual systems business. Geographic area local-
currency growth was moderate in all areas except Europe, which showed a decline. The modest increase in operating
income resulted from strong gains in construction and home improvement and home care, partially offset by a
decrease in visual systems operating income.
Safety, Security and Protection Services Business (10.6% of consolidated sales):
2004 2003 2002
Sales (millions) $2,125 $1,928 $1,686
Sales change analysis:
Local currency (volume and price) 6.6% 9.5% 3.3%
Translation 3.6 4.9 (0.5)
Total sales change 10.2% 14.4% 2.8%
Operating income (millions) $ 491 $ 437 $ 338
Percent change 12.3% 29.1% 11.9%
Percent of sales 23.1% 22.7% 20.1%
The Safety, Security and Protection Services segment serves a broad range of markets that strive to increase the
safety, security and productivity of workers, facilities and systems. Major product offerings include personal protection
products, safety and security products, energy control products, cleaning and protection products for commercial
establishments, and roofing granules for asphalt shingles.