3M Company (MMM – Analyst Report) reported record earnings of $2.02 per share for second-quarter 2015, beating the Zacks Consensus Estimate of $1.99 and reflecting an increase of 5.8% year over year. Shares were trending downward in pre-market trading, as investors were likely disappointed by the weak revenue numbers.
3M Company – Earnings Surprise | FindTheBest
Net income came in at $1.3 billion, 2.6% higher compared with the previous year. The earnings improvement was driven by successful cost streamlining initiatives.
Net sales during the quarter were $7,686 million, down 5.5% year over year and lagging the Zacks Consensus Estimate of $7,896 million. The year-over-year decrease in sales was driven by a significant negative foreign currency translation impact, which shaved off 7.3% year over year. However, the company achieved organic local-currency sales growth of 1.8%.
Operating income stood at $1,840 million in the reported quarter versus $1,856 million in the year-ago-quarter. Operating margin came in at 23.9% in the reported quarter, up 1.1% year over year.
Segment Results
Industrial segment sales decreased 6.4% year over year to $2.6 billion in the reported quarter, driven by unfavorable foreign currency impact. Organic local-currency sales increased 1.4% year over year due to strong sales in aerospace and commercial transportation, 3M purification and automotive market.
Health Care segment sales decreased 3.7% to $1.4 billion in the reported quarter, subdued by a strong dollar. Organic local-currency sales increased 3.4% year over year with growth in health information systems, food safety, infection prevention, oral care and chronic care.
Consumer segment revenues were $1.1 billion in the reported quarter, down 2.5% year over year, as organic growth of 3.4% was crushed by adverse foreign currency impact. The segment saw strength across the portfolio, especially in DIY, stationery and office supplies, and home care.
