3M Co.'s (MMM) fourth-quarter earnings rose a better-than-expected 2.8% as the consumer and industrial products maker saw strong growth in its industrial and transportation segment, but its display and graphics unit continued to post weaker sales.
The industrial conglomerate, whose products range from Post-it notes to power lines to orthodontic braces, had predicted its sales growth would remain sluggish in the new year, following an unexpectedly soft third quarter. It cited more customers drawing down inventories instead of making more orders, a problem currently challenging many providers of raw materials and product components. Its long-term outlook, though, has been bright, particularly in Asia, Latin America and other fast-growing areas.
Earlier this month, 3M agreed to buy Avery Dennison Corp.'s (AVY) office and consumer products business for $550 million, giving it a new line of labels, binders and filing and indexing products.
3M reported a profit of $954 billion, or $1.35 a share, up from $928 billion, or $1.28 a share, a year earlier. Sales improved 5.7% to $7.09 billion, mostly thanks to organic local-currency sales growth and higher selling prices, the company said.
Analysts polled by Thomson Reuters most recently forecast earnings of $1.31 on revenue of $7.09 billion.
Operating margin edged down to 19.2% from 19.4%.
Sales in its industrial and transportation segment rose 14%, while its safety, security and protection services segment's sales were up 9.4%. Display and graphics sale continued to decline, falling 8.8% in the latest quarter.
Shares of 3M, which backed its full-year guidance, closed Wednesday at $86.48 and were inactive premarket. The stock is up 12% over the past three months.
-By Ben Fox Rubin, Dow Jones Newswires; 212-416-3108; firstname.lastname@example.org;