3m Company · NYSE:MMM
3m — Q1 2023 Earnings Presentation
20 slides from 3m's earnings presentation, Apr 25, 2023
Slide 1: 2023 First Quarter Earnings
2023 First Quarter Earnings (unaudited) Mike Roman Monish Patolawala Bruce Jermeland Chairman of the Board & Executive Vice President, Senior Vice President, Chief Executive Officer Chief Financial & Investor Relations Transformation Officer
Slide 2: Forward-looking statements
2 Forward-looking statements This presentation contains forward-looking information about 3M’s financial results and estimates and business prospects that involve substantial risks and uncertainties. You can identify these statements by the use of words such as “anticipate,” “estimate,” “expect,” “a
Slide 3: Streamlining and simplifying 3M to drive growth, margins, and cash
3 Streamlining and simplifying 3M to drive growth, margins, and cash • Improve cost structure and expand margins • Reducing headcount by – Reduce corporate costs and management layers ~6,000 roles across the global – Simplify supply chain to better align how we plan, source, make and deliver organiz
Slide 4: Remain focused on our strategies while managing in a challenging environment
4 Remain focused on our strategies while managing in a challenging environment Adjusted organic growth • Q1 performance – End-market trends played out as anticipated; significant weakness in -5.6% Includes ~(3.4) ppt headwind from disposable consumer electronics and consumer retail; continued streng
Slide 5: Q1 2023 operating margin and EPS
5 Q1 2023 operating margin and EPS Adjusted Adjusted operating earnings margin per share Commentary Q1 2022 22.0% $2.63 Total organic growth/ -2.0% -$0.38 productivity/other Disposable respirator/Russia exit -1.1% -$0.21 • Decline in COVID-related disposable respirator demand; 2022 exit of operation
Slide 6: Q1 2023 cash flow and balance sheet
6 Q1 2023 cash flow and balance sheet Adjusted free cash flow Adjusted free cash flow • Q1: $0.9B, up 24% YoY $0.9B • Q1: 87%, up 37 ppts YoY Adjusted free cash flow • Q1 YoY increase driven by lower annual incentive cash Adjusted free cash flow conversion compensation and improvement in working cap
Slide 7: Business Group performance
Business Group performance Safety & Transportation & Health Care Consumer Industrial Electronics 2023 Q1 Earnings | April 25, 2023. All rights reserved.
Slide 8: Safety & Industrial
8 Safety & Industrial Q1 2023 commentary • Organic growth performance: – High-single digit increases in automotive aftermarket, electrical markets, and abrasives Organic growth – Declines in personal safety; industrial adhesives and tapes; and closure and masking systems -6.0% – Disposable respirato
Slide 9: Transportation & Electronics
9 Transportation & Electronics Q1 2023 commentary • Adjusted organic growth performance – Low-double digit increase in automotive and aerospace; high-single digit increase in advanced materials Adjusted organic growth – Significant decline in electronics (-35% YoY); single-digit declines in transpor
Slide 10: Health Care
10 Health Care Q1 2023 commentary • Organic growth performance – Low-single digit increases in medical solutions and oral care; health information systems was flat Organic growth – High-single digit decline in separation and purification due to normalization of post-COVID-related biopharma demand 1.
Slide 11: Consumer
11 Consumer Q1 2023 commentary • Organic growth performance – Low-single digit increase in stationery and office – Low double-digit decline in home improvement; mid-single digit decline in Organic growth home, health, and auto care -6.8% • Consumers shifted spending patterns and retailers aggressive
Slide 12: 2023 Outlook
2023 Outlook 2023 Q1 Earnings | April 25, 2023. All rights reserved.
Slide 13: Full-year 2023 guidance remains unchanged
13 Full-year 2023 guidance remains unchanged Full-year Q2 2023 Adjusted organic sales growth • Adjusted sales of $7.7B to $7.9B -3.0% to flat • Adjusted EPS of $1.50 to $1.75, includes pre-tax Includes ~(2) ppt headwind from disposable restructuring charge of $175M to $250M, or respirator decline an
Slide 14: Q&A
Q&A Mike Roman Chairman of the Board & Chief Monish Patolawala Executive Vice President, Chief Bruce Jermeland Senior Vice President, Executive Officer Financial & Transformation Officer Investor Relations 2023 Q1 Earnings | April 25, 2023. All rights reserved.
Slide 15: Appendix
Appendix 2023 Q1 Earnings | April 25, 2023. All rights reserved.
Slide 16: Q1 2023 P&L
16 Q1 2023 P&L Q1 Q1 GAAP ($M) 2023 2022 Change Sales $8,031 $8,829 (9.0)% Gross profit $3,418 $4,003 (14.6)% % to sales 42.6% 45.3% (2.7)% SG&A $1,705 $1,882 (9.3)% % to sales 21.3% 21.3% —% R&D & related $472 $480 (1.7)% % to sales 5.9% 5.4% 0.5% Operating income $1,241 $1,641 (24.4)% % to sales 1
Slide 17: Q1 2023 adjusted sales recap
17 Q1 2023 adjusted sales recap Americas EMEA APAC Worldwide Organic growth 0.4% (3.9)% (16.7)% (5.6)% Acquisitions/divestitures (1.6)% (1.0)% (1.0)% (1.3)% FX (0.4)% (5.0)% (5.3)% (2.8)% Total growth (1.6)% (9.9)% (23.0)% (9.7)% 2023 Q1 Earnings | April 25, 2023. All rights reserved.
Slide 18: Business segment information
18 Business segment information ($M) Adjusted net sales* Q1 2023 adjusted sales growth* Adjusted operating income* Adjusted operating margin* Total Q1 Q1 Organic sales Q1 Q1 Percent Q1 Q1 Business Groups 2023 2022 Growth FX M&A change 2023 2022 change 2023 2022 Safety & Industrial $2,779 $3,051 (6.0
Slide 19: Additional GAAP sales detail
19 Additional GAAP sales detail ($M) GAAP Net Sales ($M) GAAP Net Sales Business Groups Q1 2023 Q1 2022 Business Groups Q1 2023 Q1 2022 Abrasives 341 329 Food Safety — 92 Automotive Aftermarket 312 295 Health Information Systems 300 300 Closure and Masking Systems 245 258 Medical Solutions 1,123 1,1
Slide 20: Science. Applied to Life.
Science. Applied to Life.”