Third-quarter worldwide sales growth was 9.6 percent, of which 3.7 percent came from acquisitions, 3.1 percent from foreign exchange impacts, 1.9 percent from organic volume growth and 0.9 percent from higher year-on-year selling prices.
Organic volume growth was below recent trend levels, reflecting weakness across the electronics market along with generally slowing economic growth in the developed world.
3M also noted that a number of its customers reduced inventories during the quarter in anticipation of slowing demand.
Five of the company’s six business segments expanded sales in the quarter, with Industrial and Transportation up 15.1 percent, Safety, Security and Protection Services up 14.1 percent, Health Care up 10.9 percent, Consumer and Office up 4.6 percent and Electro and Communications up 1.0 percent.
“The business environment remains challenging, as the economic softening that we experienced late in the second quarter continued into the third,” said George W. Buckley, 3M chairman, president and chief executive officer.
Buckley continued, “Looking ahead, early evidence suggests slower growth will persist through year end, therefore we are responding to lower demand with aggressive cost management and operational discipline in developed economies.
Safety, Security and Protection Services
• Sales of $954 million, up 14.1 percent in local currency, including 5.7 percent from acquisitions.
• Strong double-digit local-currency sales growth in personal safety, roofing granules, track and trace, security systems and corrosion protection businesses.
• All geographic regions posted positive sales growth, with the U.S. at 28 percent, Asia Pacific at 25 percent, Latin America/Canada at 21 percent and Europe at 1 percent.
• Latin America/Canada at 21 percent and Europe at 1 percent.
• Operating income rose 23 percent to $202 million; operating margin of 21.1 percent.