3M Co, the maker of stethoscopes and sandpaper, raised its full-year forecast and posted profit that beat analysts' estimates as sales climbed at all divisions for the third straight quarter.
Profit excluding Medicare-related charges will be as much as $US5.80 a share this year, up from a maximum of $US5.60 forecast in April, the St. Paul, Minnesota-based company said today in a statement. Analysts had predicted $US5.64, the average of 16 estimates compiled by Bloomberg.
Chief Executive Officer George Buckley has boosted sales by expanding into emerging markets, where revenue increased 38 per cent in the second quarter. 3M, an economic bellwether because of its product range spanning the automotive, consumer and health-care markets, has introduced new products in the past 12 months for 3-D technology and solar-mirror panels.
"It was not an intergalactic blow-away, but it was really solid," Nick Heymann, a New York-based analyst with Sterne Agee & Leach Inc., said today in an interview. "Their strategy of taking share in emerging markets is definitely working."
3M rose $US2.45, or 3 per cent, to $US84.75 at 4pm in New York Stock Exchange composite trading. The shares have gained 2.5 per cent this year.
Second-quarter net income increased 43 per cent to $US1.12 billion, or $US1.54 a share, from $US783 million, or $US1.12, a year earlier. Analysts, on average, projected profit of $US1.47 a share. Sales climbed 18 per cent to $US6.73 billion.
Operating Margins
Sales at the electronics and communications division climbed 32 per cent to $US726 million, the biggest increase of any unit. Revenue at the display and graphics division rose 30 per cent to $US1.05 billion, driven by sales of films used on LED back-lit televisions.
"Sales of $US6.7 billion matched our previous all-time quarterly record set in 2008," Buckley said during a conference call with analysts and investors.
The company boosted its forecast for sales-volume growth from existing businesses to as much as 15 per cent from 12 per cent.
All six of 3M's units posted operating margins of 22 per cent or higher. 3M said its full-year operating-income margins will exceed 22.5 per cent. Previously, 3M said margins would exceed 22 per cent.