3M Company 96OI 3rd Quarter Results

  3M Company (96OI) - 3rd Quarter Results

RNS Number : 1640Q
3M Company
01 November 2012






                                UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                                      

                                  FORM10-Q

                                      

           QUARTERLY REPORT PURSUANT TO SECTION13 OR 15(d)OF THE

                       SECURITIES EXCHANGE ACT OF 1934

                                      

              For the quarterly period ended September 30, 2012

                                      

                       Commission file number: 1-3285

                                      

                                  3M COMPANY

            (Exact name of registrant as specified in its charter)



                DELAWARE                      41-0417775
    (State or other jurisdiction of        (I.R.S. Employer
     incorporation or organization)       Identification No.)
     3M Center, St. Paul, Minnesota              55144
(Address of principal executive offices)      (Zip Code)

                                      

                                (651) 733-1110

             (Registrant's telephone number, including area code)

                                      

Indicate by check mark whether the registrant (1)has filed all reports
required to be filed by Section13 or 15(d)of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2)has been subject to
such filing requirements for the past 90 days. YesxNoo



Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule405 of Regulation S-T (§232.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files). YesxNoo



Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company.
See the definitions of "large accelerated filer," "accelerated filer" and
"smaller reporting company" in Rule12b-2 of the Exchange Act.



Large accelerated filerx                          Accelerated filero
Non-accelerated filero (Do not check if a smaller Smaller reporting companyo
reporting company)



Indicate by check mark whether the registrant is a shell company (as defined
in Rule12b-2 of the Exchange Act). YesoNox



Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.



                 Class                   Outstanding at September 30, 2012
Common Stock, $0.01 par value per share         691,931,278 shares

                                      

            This document (excluding exhibits) contains 77 pages.

                The table of contents is set forth on page2.

                     The exhibit index begins on page74.

                                  3M COMPANY

         Form10-Q for the Quarterly Period Ended September 30, 2012

                              TABLE OF CONTENTS

                                                                    BEGINNING
                                                                      PAGE
PARTI   FINANCIAL INFORMATION
ITEM 1.  Financial Statements
         Index to Financial Statements:
         Consolidated Statement of Income                                   3
         Consolidated Statement of Comprehensive Income                     4
         Consolidated Balance Sheet                                         5
         Consolidated Statement of Cash Flows                               6
         Notes to Consolidated Financial Statements
         Note 1.Significant Accounting Policies                          7
         Note 2.Acquisitions                                             9
         Note 3.Goodwill and Intangible Assets                          10
         Note 4.Supplemental Equity and Comprehensive Income            12
         Information
         Note 5.Income Taxes                                            16
         Note 6.Marketable Securities                                   18
         Note 7.Long-Term Debt and Short-Term Borrowings                20

         Note 8.Pension and Postretirement Benefit Plans                21
         Note 9. Derivatives                                             23
         Note 10.Fair Value Measurements                                  29
         Note 11.Commitments and Contingencies                            33
         Note 12.Stock-Based Compensation                                 42
         Note 13.Business Segments                                        46
         Report of Independent Registered Public Accounting Firm           48
ITEM 2.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations
         Index to Management's Discussion and Analysis:
         Overview                                                          49
         Results of Operations                                             52
         Performance by Business Segment                                   56
         Financial Condition and Liquidity                                 62
         Cautionary Note Concerning Factors That May Affect Future         66
         Results
ITEM 3.  Quantitative and Qualitative Disclosures About Market             67
         Risk
ITEM 4.  Controls and Procedures                                           70
PARTII  OTHER INFORMATION
ITEM 1.  Legal Proceedings                                                 71
ITEM 1A. Risk Factors                                                      71
ITEM 2.  Unregistered Sales of Equity Securities and Use of                73
         Proceeds
ITEM 3.  Defaults Upon Senior Securities                                   73
ITEM 4.  Mine Safety Disclosures                                           73
ITEM 5.  Other Information                                                 73
ITEM 6.  Exhibits                                                          74



                                 3M COMPANY
                                  FORM10-Q
              For the Quarterly Period Ended September 30, 2012
                       PARTI. Financial Information
Item 1. Financial Statements.
3M Company and Subsidiaries
Consolidated Statement of
Income
(Unaudited)
                                  Three months ended     Nine months ended
                                    September 30,          September 30,
(Millions, except per share        2012      2011      2012       2011
amounts)
Net sales                        $ 7,497  $ 7,531  $ 22,517  $ 22,522
Operating expenses
    Cost of sales                  3,935    4,027    11,694    11,869
    Selling, general and           1,487    1,534     4,567     4,648
    administrative expenses
    Research, development and        397      389     1,216     1,191
    related expenses
           Total operating         5,819    5,950    17,477    17,708
           expenses
Operating income                   1,678    1,581     5,040     4,814
Interest expense and income
    Interest expense                  44       48       127       141
    Interest income                  (10)      (10)       (29)       (29)
           Total interest             34       38        98       112
           expense - net
Income before income taxes         1,644    1,543     4,942     4,702
Provision for income taxes           464      440     1,435     1,319
Net income including             $ 1,180  $ 1,103  $  3,507  $  3,383
noncontrolling interest
Less: Net income attributable         19       15        54        54
to noncontrolling interest
Net income attributable to 3M    $ 1,161  $ 1,088  $  3,453  $  3,329
Weighted average 3M common         693.0    707.7     694.7     710.9
shares outstanding - basic
Earnings per share attributable
to 3M common
    shareholders - basic         $  1.68  $  1.54  $   4.97  $   4.68
Weighted average 3M common         703.1    715.5     703.9     722.8
shares outstanding - diluted
Earnings per share attributable
to 3M common
    shareholders - diluted       $  1.65  $  1.52  $   4.91  $   4.61
Cash dividends paid per 3M       $  0.59  $  0.55  $   1.77  $   1.65
common share
The accompanying Notes to Consolidated Financial Statements are an integral
part of this statement.

3M Company and Subsidiaries
Consolidated Statement of
Comprehensive Income
(Unaudited)
                                     Three months ended    Nine months ended
                                       September 30,         September 30,
(Millions)                            2012      2011      2012      2011
Net income including                $ 1,180  $ 1,103  $ 3,507  $ 3,383
noncontrolling interest
Other comprehensive income (loss),
net of tax:
    Cumulative translation              412     (490)      211      (14)
    adjustment
    Defined benefit pension and
    postretirement plans                 96       77      291      207
    adjustment
    Debt and equity securities,           3       (2)        4       (5)
    unrealized gain (loss)
    Cash flow hedging instruments,      (36)       54      (28)       37
    unrealized gain (loss)
Total other comprehensive income        475     (361)      478      225
(loss), net of tax
Comprehensive income (loss)           1,655      742    3,985    3,608
including noncontrolling interest
Comprehensive (income) loss
attributable to noncontrolling          (30)      (32)      (55)      (75)
interest
Comprehensive income (loss)         $ 1,625  $   710  $ 3,930  $ 3,533
attributable to 3M
The accompanying Notes to Consolidated Financial Statements are an integral
part of this statement.

3M Company and Subsidiaries
Consolidated Balance Sheet
(Unaudited)
                                                  September 30,  December 31,
(Dollarsinmillions,exceptpershareamount)        2012         2011
Assets
Current assets
  Cash and cash equivalents                       $     3,029  $    2,219
  Marketable securities - current                       1,989       1,461
  Accounts receivable - net                             4,409       3,867
  Inventories
           Finished goods                               1,783       1,536
           Work in process                              1,163       1,061
           Raw materials and supplies                     896         819
Total inventories                                       3,842       3,416
Other current assets                                    1,225       1,277
  Total current assets                                 14,494      12,240
Marketable securities - non-current                     1,400         896
Investments                                               142         155
Property, plant and equipment                          22,042      21,166
  Less: Accumulated depreciation                      (14,103)     (13,500)
           Property, plant and equipment - net          7,939       7,666
Goodwill                                                7,216       7,047
Intangible assets - net                                 1,847       1,916
Prepaid pension benefits                                   47          40
Other assets                                            1,394       1,656
           Total assets                           $    34,479  $   31,616
Liabilities
Current liabilities
  Short-term borrowings and current portion of    $     1,506  $      682
  long-term debt
  Accounts payable                                      1,805       1,643
  Accrued payroll                                         684         676
  Accrued income taxes                                    301         355
  Other current liabilities                             2,299       2,085
           Total current liabilities                    6,595       5,441
Long-term debt                                          4,852       4,484
Pension and postretirement benefits                     3,114       3,972
Other liabilities                                       1,777       1,857
           Total liabilities                      $    16,338  $   15,754
Commitments and contingencies (Note 11)
Equity
3M Company shareholders' equity:
  Common stock par value, $.01 par value,         $         9  $        9
  944,033,056 shares issued
  Additional paid-in capital                            3,998       3,767
  Retained earnings                                    30,150      28,348
  Treasury stock, at cost: 252,101,778 shares at
  September 30, 2012;
           249,063,015 shares at December 31,         (11,965)     (11,679)
           2011
  Accumulated other comprehensive income (loss)        (4,548)      (5,025)
           Total 3M Company shareholders' equity       17,644      15,420
Noncontrolling interest                                   497         442
           Total equity                           $    18,141  $   15,862
           Total liabilities and equity           $    34,479  $   31,616
The accompanying Notes to Consolidated Financial Statements are an integral
part of this statement.

3M Company and Subsidiaries
Consolidated Statement of Cash
Flows
(Unaudited)
                                                Nine months ended
                                                  September 30,
(Millions)                            2012                           2011
Cash Flows from Operating
Activities
Net income including                $  3,507                      $  3,383
noncontrolling interest
Adjustments to reconcile net
income including noncontrolling
interest to net cash
     provided byoperating
     activities
     Depreciation and amortization       956                           919
     Company pension and                (918)                          (373)
     postretirement contributions
     Company pension and                 490                           400
     postretirement expense
     Stock-based compensation            181                           210
     expense
     Deferred income taxes                89                           (37)
     Excess tax benefits from            (53)                           (52)
     stock-based compensation
     Changes in assets and
     liabilities
          Accounts receivable           (493)                          (557)
          Inventories                   (368)                          (364)
          Accounts payable               141                           (30)
          Accrued income taxes           (48)                           212
          (current and long-term)
          Product and other
          insurance receivables          (11)                           (45)
          and claims
     Other - net                          89                          (120)
Net cash provided by operating         3,562                         3,546
activities
Cash Flows from Investing
Activities
Purchases of property, plant and        (977)                          (862)
equipment (PP&E)
Proceeds from sale of PP&E and            15                            12
other assets
Acquisitions, net of cash acquired      (248)                          (531)
Purchases of marketable securities    (4,313)                        (2,592)
and investments
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Proceeds from sale of marketable       1,778 truncated,
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