3M 2015 Annual Report Download - page 24
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Please find page 24 of the 2015 3M annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.TableofContents
InterestIncome:Interestincomein2015waslowerwhencomparedto2014duetoloweraveragecash/marketablesecurities
balances.Interestincomein2014waslowerwhencomparedto2013duetolowercashbalances.
Provision for Income Taxes:
(Percentofpre-taxincome) 2015 2014 2013
Effectivetaxrate 29.1 % 28.9 % 28.1 %
Theeffectivetaxratefor2015was29.1percent,comparedto28.9percentin2014,anincreaseof0.2percentagepoints.The
effectivetaxratefor2014was28.9percent,comparedto28.1percentin2013,anincreaseof0.8percentagepoints.Thechangesin
theratesbetweenyearsareimpactedbymanyfactors,asdescribedfurtherinNote8.
TheCompanycurrentlyexpectsthatitseffectivetaxratefor2016willbeapproximately29.5to30.5percent.Theratecanvaryfrom
quartertoquarterduetodiscreteitems,suchasthesettlementofincometaxauditsandchangesintaxlaws,aswellasrecurring
factors,suchasthegeographicmixofincomebeforetaxes.
RefertoNote8forfurtherdiscussionofincometaxes.
Net Income Attributable to Noncontrolling Interest:
(Millions) 2015 2014 2013
Netincomeattributabletononcontrollinginterest $ 8 $ 42 $ 62
Netincomeattributabletononcontrollinginterestrepresentstheeliminationoftheincomeorlossattributabletonon-3Mownership
interestsin3Mconsolidatedentities.ThechangesinnoncontrollinginterestamountshavelargelyrelatedtoSumitomo3MLimited
(Japan),whichwas3M’smostsignificantconsolidatedentitywithnon-3Mownershipinterests.AsdiscussedinNote6,on
September1,2014,3Mpurchasedtheremaining25percentownershipinSumitomo3MLimited,bringing3M’sownershipto100
percent.Thus,effectiveSeptember1,2014,netincomeattributabletononcontrollinginterestwassignificantlyreduced.The
primaryremainingnoncontrollinginterestrelatesto3MIndiaLimited,ofwhich3M’seffectiveownershipis75percent.
Currency Effects:
3Mestimatesthatyear-on-yearcurrencyeffects,includinghedgingimpacts,decreasedpre-taxincomebyapproximately$390
millionand$100millionin2015and2014,respectively.Theseestimatesincludetheeffectoftranslatingprofitsfromlocal
currenciesintoU.S.dollars;theimpactofcurrencyfluctuationsonthetransferofgoodsbetween3MoperationsintheUnitedStates
andabroad;andtransactiongainsandlosses,includingderivativeinstrumentsdesignedtoreduceforeigncurrencyexchangerate
risksandthenegativeimpactofswappingVenezuelanbolivarsintoU.S.dollars.3Mestimatesthatyear-on-yearderivativeandother
transactiongainsandlossesincreasedpre-taxincomebyapproximately$180millionand$10millionin2015and2014,
respectively.RefertoNote12intheConsolidatedFinancialStatementsforadditionalinformationconcerning3M’shedging
activities.
PERFORMANCEBYBUSINESSSEGMENT
Disclosuresrelatingto3M’sbusinesssegmentsareprovidedinItem1,BusinessSegments.Financialinformationandother
disclosuresareprovidedintheNotestotheConsolidatedFinancialStatements.AsdescribedinNote16,effectiveinthethird
quarterof2015,withintheHealthCarebusinesssegment,theCompanyformedtheOralCareSolutionsDivision,whichcombined
theformer3MESPEand3MUnitekdivisions.3Mmanagesitsoperationsinfivebusinesssegments.Thereportablesegmentsare
Industrial;SafetyandGraphics;ElectronicsandEnergy;HealthCare;andConsumer.
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