3M Profits Drop 81 Percent
MAPLEWOOD, Minn. (AP) _ Profits at 3M Co. fell 81 percent in the third quarter as the company contended with restructuring costs, slower sales and unfavorable currency exchange rates, the company said today.
Minnesota Mining and Manufacturing Co. reported Thursday that it earned $178 million, or 44 cents per diluted common share, compared with $927 million, or $2.21 per share in the year ago quarter.
Revenue slipped slightly from to $3.77 billion from $3.83 billion.
The bottom line was hurt by a $332 million restructuring charge that included employee severance. 3M said this summer it would eliminate 4,500 jobs, or about 6 percent of its work force, by the end of 1999 to try to improve productivity. Total restructuring charges eventually will be about $500 million.
Changes in currency exchange rates cut earnings by 8 cents a share.
Excluding the restructuring charge, 3M’s earnings fell about 10 percent to $629 million in operating income, or 97 cents per diluted share, compared with $701 million, or $1.03 per diluted share, in the year-ago quarter.
Analysts surveyed by First Call Corp. had expected earnings of 98 cents a share. 3M’s stock was off $4.12 1/2 at $80.12 1/2 in midday trading on the New York Stock Exchange.
L.D. DeSimone, the company’s chairman and chief executive, said 3M expects fourth-quarter results to be higher than last year.
``While we are facing a challenging economic environment, we expect to see increasing benefits from our cost-reduction efforts,″ DeSimone said. ``We are monitoring global economic conditions closely, and we will make further adjustments as necessary.″
Through the first nine months, 3M earned $964 million, or $2.36 per diluted common share, compared with $1.76 billion, or $4.17 per share, a year earlier. Revenue declined slightly to $11.2 billion from $11.4 billion.