3M CEO Introduces Priorities for the Future, Sets Five-Year Financial Targets
ST. PAUL, Minn.--(BUSINESS WIRE)--Nov 15, 2018--Speaking today at the company’s Investor Day in St. Paul, 3M CEO Mike Roman will lay out new five-year financial objectives while introducing his priorities for the future. The four priorities – focused around Portfolio, Innovation, Transformation, and People and Culture – are positioning 3M for long-term growth and value creation.
These priorities are a key component of the 3M value model, and Roman will detail how that unique model will drive performance today and into the future. He will discuss 3M’s plans to continue actively managing its portfolio to maximize value, and how the company’s transformation initiative will enable greater productivity and continued margin expansion. The company will also emphasize how 3M science and technologies are being applied to high-growth areas such as automotive electrification, advanced wound care, connected safety, biopharma filtration, and data centers.
“As we work to deliver a strong close to 2018, we are positioning our company for success in 2019 and beyond – which includes taking actions around our four priorities,” said Mike Roman, 3M chief executive officer. “Our team is focused on growth, operational execution, and delivering for our customers and shareholders.”
3M’s new five-year financial objectives – covering 2019 through 2023 – are:3 to 5 percent organic local currency sales growth 8 to 11 percent growth in earnings per share 20 percent return on invested capital 100 percent free cash flow conversion
In addition to its five-year goals, 3M will also outline its expectations for 2019:1 to 3 percent total sales growth 2 to 4 percent organic local currency sales growth Earnings per share of $10.60 to $11.05 20 to 25 percent EPS growth, on a GAAP basis7 to 11 percent EPS growth, adjusting for certain 2018 items 22 to 25 percent return on invested capital 95 to 105 percent free cash flow conversion (based on operating cash flow of $7.9 to $8.5 billion).
Refer to section entitled “Supplemental Financial Information, Non-GAAP Measures” for more detail.
In 2019, 3M plans to invest $2 billion in research and development – or approximately 6 percent of sales – along with $1.7 to $2 billion in capital expenditures. The company also plans gross share repurchases in the range of $2 to $4 billion for the year.
Today’s meeting will be webcast live beginning at 7:30 a.m. CST and is scheduled to end at noon CST. Investors can access this meeting via the following:Live webcast at http://investors.3M.com. Webcast replay: Go to 3M’s Investor Relations website at http://investors.3M.com and click on “3M 2018 Investor Day.”
Forward-Looking Statements This news release 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,” “aim,” “project,” “intend,” “plan,” “believe,” “will,” “should,” “could,” “target,” “forecast” and other words and terms of similar meaning in connection with any discussion of future operating or financial performance or business plans or prospects. Among the factors that could cause actual results to differ materially are the following: (1) worldwide economic, political, and capital markets conditions and other factors beyond the Company’s control, including natural and other disasters or climate change affecting the operations of the Company or its customers and suppliers; (2) the Company’s credit ratings and its cost of capital; (3) competitive conditions and customer preferences; (4) foreign currency exchange rates and fluctuations in those rates; (5) the timing and market acceptance of new product offerings; (6) the availability and cost of purchased components, compounds, raw materials and energy (including oil and natural gas and their derivatives) due to shortages, increased demand or supply interruptions (including those caused by natural and other disasters and other events); (7) the impact of acquisitions, strategic alliances, divestitures, and other unusual events resulting from portfolio management actions and other evolving business strategies, and possible organizational restructuring; (8) generating fewer productivity improvements than estimated; (9) unanticipated problems or delays with the phased implementation of a global enterprise resource planning (ERP) system, or security breaches and other disruptions to the Company’s information technology infrastructure; (10) financial market risks that may affect the Company’s funding obligations under defined benefit pension and postretirement plans; and (11) legal proceedings, including significant developments that could occur in the legal and regulatory proceedings described in the Company’s Annual Report on Form 10-K for the year ended Dec. 31, 2017, and any subsequent quarterly reports on Form 10-Q (the “Reports”). Changes in such assumptions or factors could produce significantly different results. A further description of these factors is located in the Reports under “Cautionary Note Concerning Factors That May Affect Future Results” and “Risk Factors” in Part I, Items 1 and 1A (Annual Report) and in Part I, Item 2 and Part II, Item 1A (Quarterly Reports). The information contained in this news release is as of the date indicated. The Company assumes no obligation to update any forward-looking statements contained in this news release as a result of new information or future events or developments.
About 3M At 3M, we apply science in collaborative ways to improve lives daily. With $32 billion in sales, our 91,000 employees connect with customers all around the world. Learn more about 3M’s creative solutions to the world’s problems at www.3M.com or on Twitter @3M or @3MNews.
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