Industrials
3M to Slash 1,500 Jobs After Top Line Misses Estimates
Published:
Last Updated:
3M Co. (NYSE: MMM) reported third-quarter 2015 results before markets opened Thursday. The conglomerate posted diluted earnings per share (EPS) of $2.05 on revenues of $7.71 billion. In the same period a year ago, the company reported EPS of $1.98 on revenues of $8.14 billion. Third-quarter results also compare to the Thomson Reuters consensus estimates for EPS of $2.00 and $7.85 billion in revenues.
Organic local-currency sales grew 1.2% and foreign currency translation reduced sales by 7.4% year on year.
3M also announced a restructuring plan that will result in an expected reduction of 1,500 positions worldwide and estimated pretax savings of $130 million in 2016. The company anticipates a fourth-quarter pretax charge of approximately $100 million, or $0.13 per share, related to this plan. Reductions will be primarily focused on structural overhead, largely in the United States, and slower-growing markets, with particular emphasis on EMEA and Latin America.
3M lowered its full-year adjusted earnings expectation from a prior range of $7.80 to $8.10 per share to a new range of $7.73 to $7.78. Organic local-currency sales growth is expected to be in the range of 1.5% to 2.0%, versus previous guidance of 2.5% to 4.0%. The company anticipates that full-year free cash flow conversion will be in the range of 95% to 100%, versus a previous estimated range of 90% to 100%. The current consensus analysts’ estimate calls for full-year EPS of $7.77 on sales of $30.78 billion.
ALSO READ: The Most Profitable Companies in the World
CEO Inge G. Thulin said:
We continue to take actions to strengthen our portfolio, increase our scientific edge through research and development, and transform our business processes through a new global ERP system. We are building a stronger, more streamlined and more focused company that can compete and win for years to come.
3M’s shares traded up about 3.7% late Thursday morning to $155.35. The current 52-week range is $134.00 to $170.50. Thomson Reuters had a consensus analyst price target of $156.50 before the report.
Get Ready To Retire (Sponsored)
Start by taking a quick retirement quiz from SmartAsset that will match you with up to 3 financial advisors that serve your area and beyond in 5 minutes, or less.
Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests.
Here’s how it works:
1. Answer SmartAsset advisor match quiz
2. Review your pre-screened matches at your leisure. Check out the advisors’ profiles.
3. Speak with advisors at no cost to you. Have an introductory call on the phone or introduction in person and choose whom to work with in the future
Get started right here.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
