3M has reported fiscal-fourth-quarter sales of US$8.3 billion, up 2.1 per cent from one year earlier.
Sales in the company’s health care division jumped 25.4 per cent to $2.1 billion.
3M’s safety and industrial division reported sales of $2.8 billion, a decline of 4.8 per cent while sales in the company’s transportation and electronics division dipped 6.2 per cent to $2.3 billion.
Mike Roman, 3M chairman and CEO, said the results were in-line with expectations.
“While we continued to manage challenges in certain key end markets, we generated solid underlying margins and robust free cash flow,” Roman said.
“We also continue to build for the future, including the launch of our new global operating model which represents the next phase of our transformation journey. As a result of our actions, we are well positioned to improve our performance, return to growth and deliver a successful 2020.”
Sales grew 2.1 per cent year-on-year to $8.1 billion. Organic local-currency sales declined 2.6 per cent while acquisitions, net of divestitures, increased sales by 5.1 per cent. Foreign currency translation reduced sales by 0.4 percent year-on-year.
On a geographic basis, total sales grew 7.4 per cent in the U.S., 1.2 per cent in Latin America/Canada, with declines of 1.7 per cent in Asia Pacific and 2.0 per cent in EMEA (Europe, Middle East and Africa).
Organic local-currency sales were flat in Latin America/Canada, with declines of 2.7 per cent in both Asia Pacific and EMEA and 2.9 per cent in the U.S.
3M accelerates pace of transformation journey
3M also announced the next step in its transformation journey, which includes a new global operating model and streamlined organisational structure.
The company said its new global operating model, implemented on January 1, 2020, further aligns its four business groups – Safety & Industrial, Transportation & Electronics, Health Care, and Consumer – with the company’s customers and go-to-market models.
In the new model, 3M’s business groups now have full responsibility for all facets of strategy, portfolio optimization and resource prioritisation across their entire global operations.
Under the prior model, area and country teams – which comprised 3M’s International Operations organisation – were responsible for setting priorities in their regions.
All of 3M’s international employees now report into the business groups and functions they are part of, and 3M no longer has an International Operations organization.
As a result of these actions, 3M initiated a restructuring that will reduce approximately 1500 positions, spanning all business groups, functions and geographies.
“3M continues to transform how it operates and build a more customer-driven and streamlined organization for the future,” said Roman,.
“The latest phase of our transformation journey is designed to improve growth and operational efficiency, and will enable us to create even more value for our customers and shareholders. This is a defining moment in how we run our company, and positions 3M for success in the years ahead.”
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