3M-MMM's Q4 Earnings Surpass Estimates, Revenues Increase Y/Y

Core Viewpoint - 3M Company reported fourth-quarter 2024 results with revenues and earnings exceeding the Zacks Consensus Estimate, although earnings declined while revenues saw a marginal increase year-over-year [1][2]. Financial Performance - Adjusted earnings were $1.68 per share, surpassing the Zacks Consensus Estimate of$ 1.66, but down from $1.70 per share in the same quarter last year [2]. - Net revenues reached$ 6 billion, exceeding the consensus estimate of $5.8 billion, reflecting a 0.1% year-over-year increase. Adjusted revenues increased by 2.2% year-over-year, with organic sales up 2.1% [3]. - The Americas saw organic sales rise by 1.2%, while Asia Pacific increased by 0.8%. However, organic sales in Europe, the Middle East, and Africa decreased by 4.9% [4]. Segment Results - Safety and Industrial segment revenues totaled$ 2.70 billion, up 1.6% year-over-year, exceeding the consensus estimate of $2.67 billion. Organic revenues increased by 2.4% [5]. - Transportation & Electronics segment revenues were$ 1.99 billion, down 4.5% year-over-year, attributed to a 3.9% decline in organic sales, with a consensus estimate of $1.79 billion [6]. - Consumer segment revenues increased by 0.3% year-over-year to$ 1.23 billion, slightly below the consensus estimate of $1.24 billion, with organic sales up 1.2% [7]. Margin Profile - Cost of sales decreased by 1.3% year-over-year to$ 3.7 billion, while selling, general, and administrative expenses fell by 11.5% to $899 million. Research and development expenses decreased by 3.4% to$ 282 million [8]. - Operating income was reported at $1.1 billion, up 20.7% from the previous year, with adjusted operating income increasing by 1.4% to$ 1.14 billion. The adjusted operating margin was 19.7%, slightly down from 19.9% year-over-year [9]. Balance Sheet and Cash Flow - At the end of the fourth quarter, cash and cash equivalents stood at $5.6 billion, down from$ 5.7 billion at the end of December 2023. Long-term debt decreased to $11.1 billion from$ 13.1 billion [10]. - The company generated net cash of $1.8 billion from operating activities, down from$ 6.7 billion in the previous year. Capital expenditures for property, plant, and equipment decreased by 26.9% to $1.2 billion [11]. Guidance - For 2025, 3M expects adjusted earnings to be in the range of$ 7.60- $7.90 per share, with a midpoint of$ 7.75, reflecting an increase from $7.30 per share reported in 2024. Adjusted organic revenues are anticipated to grow by 2-3% [12].