3M 2015 Annual Report Download - page 17

TableofContents
Fortotalyear2015,netincomeattributableto3Mwas$4.833billion,or$7.58perdilutedshare,comparedto$4.956billion,or
$7.49perdilutedshare,in2014,anincreaseof1.2percentonaperdilutedsharebasis.Operationalbenefitsincludethecombination
ofsellingpriceincreasesandrawmaterialcostdecreases,partiallyoffsetbyhigherpension/postretirementbenefitcosts.
Restructuringactions(discussedabove)resultedinanafter-taxchargeof14centsperdilutedshare.Acquisitionanddivestiture
impactsprimarilyrelatetotheCapitalSafetyandPolyporeSeparationsMediaacquisitions,andthedivestituresofthelicenseplate
convertingbusinessinFranceandsubstantiallyallofthelibrarysystemsbusiness.Foreignexchangeimpactsdecreasedearningsper
dilutedsharebyapproximately43centsyear-on-year,drivenbyaverageyear-on-yearchangesinforeignexchangeratesintheEuro
of17percent,Yenof12percent,andBrazilRealof30percent.Theincometaxratewaslargelyunchangedyear-on-year.Weighted-
averagedilutedsharesoutstandingin2015declined3.7percentyear-on-yearto637.2million,whichincreasedearningsperdiluted
sharebyapproximately28cents.Refertothesectionentitled“ResultsofOperations”forfurtherdiscussion.
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Fortotalyear2014,netincomeattributableto3Mwas$4.956billion,or$7.49perdilutedshare,comparedto$4.659billion,or
$6.72perdilutedshare,in2013,anincreaseof11.5percentonaperdilutedsharebasis.Operationalbenefitsincludeasignificant
benefitfromthecombinationofsellingpriceincreasesandrawmaterialcostdecreases,plusprofitleverageonorganicvolume
growth.Foreignexchangeimpactsdecreasedearningsperdilutedsharebyapproximately15centsperdilutedshare.Theincometax
ratewas28.9percentin2014,up0.8percentagepointsversus2013,whichdecreasedearningsperdilutedsharebyapproximately8
cents.Weighted-averagedilutedsharesoutstandingin2014declined4.6percentyear-on-yearto662.0million,whichincreased
earningsperdilutedsharebyapproximately34cents.
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Fourth-quarter 2015 sales and operating income results: 
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Fourth-quarter2015netincomeattributableto3Mwas$1.038billion,or$1.66perdilutedshare,comparedto$1.179billion,or
$1.81perdilutedshare,inthefourthquarterof2014.Fourth-quarter2015salestotaled$7.3billion,adecreaseof5.4percentfrom
thefourthquarterof2014.3Machievedorganiclocal-currencysalesgrowth(whichincludesorganicvolumeandsellingprice
impacts)inHealthCare,andConsumer,withdeclinesinIndustrial,SafetyandGraphics,andElectronicsandEnergy.Organiclocal-
currencysalesincreased4.5percentinHealthCare,ledbyhealthinformationsystems,foodsafety,oralcare,drugdeliverysystems,
andcriticalandchroniccare.Organiclocal-currencysalesincreased2.7percentintheConsumerbusinesssegment,withpositive
growthintheconstructionandhomeimprovementbusiness,stationeryandofficesupplies,andhomecare,whileconsumerhealth
caredeclined.Organiclocal-currencysalesdeclined1.8percentinIndustrial,withsalesgrowthin3Mpurificationandautomotive
OEMmorethanoffsetbydeclinesinindustrialadhesivesandtapes,abrasives,andadvancedmaterials.Organiclocal-currency
salesdeclined2.5percentinSafetyandGraphics,withsalesdeclinesinpersonalsafetypartiallyoffsetbysalesgrowthinroofing
granules,andcommercialsolutions,whiletrafficsafetyandsecuritywasflat.ElectronicsandEnergyorganiclocal-currencysales
growthdeclined7.7percent,withdecreasesinelectronic-relatedsalesinbothelectronicsmaterialssolutions,anddisplaymaterials
andsystems.Energy-relatedorganiclocal-currencysalesdeclinedinrenewableenergy,communicationsmarkets,andelectrical
markets.FortheCompanyintotal,organic-localcurrencysalesdeclined1.1percent,withorganicvolumedeclinesof2.3percent
partiallyoffsetbyhighersellingpriceswhichadded1.2percent.Acquisitionsadded1.9percenttosales,whichrelatedtothe
March2015acquisitionofIveraMedicalCorp.(Ivera),theAugust2015acquisitionofCapitalSafetyGroupS.A.R.L.(Capital
Safety),andtheAugust2015acquisitionofPolyporeInternationalInc.’sSeparationsMediabusiness(Polypore).Divestitures
reducedsalesby0.4percent,relatedtotheJanuary2015saleoftheglobalstaticbusiness,andthefourthquartersaleofthelicense
convertingbusinessinFrance,alongwithsubstantiallyallofthelibrarysystemsbusiness.Foreigncurrencytranslationreducedsales
by5.8percentyear-on-year.
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Fromageographicareaperspective,fourth-quarter2015organiclocal-currencysalesgrew1.1percentinEMEA.Organiclocal-
currencysalesdeclined0.4percentintheUnitedStates,0.6percentinLatinAmerica/Canada,and2.7percentinAsiaPacific.In
EMEA,Central/EastEuropeshowedsolidlocal-currencysalesgrowthinthequarter,whileWestEuropewasupslightly,andMiddle
East/Africadeclined.Organiclocal-currencysalesintheUnitedStatesdeclined,as3Mexperiencedweakend-marketdemandinits
industrial-relatedbusinesses.Theconsumer-orientedbusinesses(HealthCareandConsumer)continuedtodeliverpositiveorganic
growth.Organiclocal-currencysalesinLatinAmerica/Canadadeclined.InLatinAmerica,Mexicocontinueditstrendofstrong
organicgrowth,increasing7percent,whileBrazildeclined6percent.Organiclocal-currencysalesinAsiaPacificdeclined2.7
percent.Threeoffive
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