3M 2011 Annual Report Download - page 31

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25
2010 sales growth was broad-based, led by office supply products, consumer health care, home care, do-it-yourself
products and stationery products. On a geographic basis, sales growth was led by Asia Pacific, Latin
America/Canada and the United States.
Consumer and Office operating income increased 12.3 percent to $840 million, with operating income margins of
21.8 percent. In 2009, this business segment recorded charges of $13 million related to restructuring actions, with
this charge comprised of employee-related liabilities for severance and benefits.
Safety, Security and Protection Services Business (12.9% of consolidated sales):
2011 2010 2009
Sales (millions) .................................................................... $ 3,821
$ 3,316 $ 3,076
Sales change analysis:
Organic local-currency sales (volume and price) ......... 7.1
6.1 (4.9 )
Acquisitions .................................................................. 4.7
1.2 2.3
Local-currency sales .................................................... 11.8 % 7.3% (2.6 )%
Divestitures .................................................................. —
—
(0.9 )
Translation ................................................................... 3.4
0.5 (4.4 )
Total sales change ........................................................... 15.2 % 7.8% (7.9 )%
Operating income (millions) ................................................ $ 814
$ 709 $ 728
Percent change ................................................................ 14.9 % (2.6)% 5.2 %
Percent of sales ............................................................... 21.3 % 21.4% 23.7 %
The Safety, Security and Protection Services segment serves a broad range of markets that increase the safety,
security and productivity of workers, facilities and systems. Major product offerings include personal protection
products, cleaning and protection products for commercial establishments, safety and security products (including
border and civil security solutions), roofing granules for asphalt shingles, corrosion protection products used in the oil
and gas pipeline markets, and track and trace solutions. 3M’s Track and Trace Solutions utilize radio frequency
identification (RFID) technology to provide a growing array of solutions.
Year 2011 results:
Safety, Security and Protection Services sales increased 15.2 percent in 2011. H1N1-related comparisons reduced
2011 sales growth by 2.5 percent, as 3M generated sales related to the H1N1 virus in the first three quarters of 2010.
Even with this difficult comparison, local-currency sales growth was 11.8 percent, which included 4.7 percent growth
from acquisitions. The acquisition benefit primarily related to Attenti Holdings S.A. and Cogent Inc. (which are
discussed further below). Foreign currency effects added 3.4 percent to 2011 sales. All geographic regions posted
positive sales growth, with sales growth led by Asia Pacific, Latin America/Canada, and the U.S. These three regions
all had local-currency sales growth in excess of 15 percent.
Local-currency sales increased in all businesses. Sales dollar increases were largest in personal protection products,
security systems, track and trace, building and commercial services, and corrosion protection. Sales growth in
personal protection products, or more specifically, respiratory products, was hampered by H1N1-related
comparisons, partially offset by some modest additional sales of personal protective equipment related to the
cleanup efforts in Japan.
Operating income for 2011 rose 14.9 percent to $814 million. 3M achieved a 21.3 percent operating income margin,
despite H1N1-related comparisons that negatively impacted results.
Year 2010 results:
Safety, Security and Protection Services sales increased 7.8 percent in 2010. Local-currency sales growth was 7.3
percent, which included a 1.2 percent benefit from acquisitions. Foreign exchange impacts added 0.5 percent to
sales. The acquisition benefit primarily related to two fourth-quarter 2010 acquisitions, namely Attenti Holdings S.A.
and Cogent Inc. Attenti Holdings S.A. is a supplier of remote people-monitoring technologies used for offender-
monitoring applications and to assist eldercare facilities in monitoring and enhancing the safety of patients. Cogent
Inc. is a provider of finger, palm, face and iris biometric systems for governments, law enforcement agencies, and
commercial enterprises.