By John Keilman
3M is targeting climate technology, industrial automation and next generation electronics as lucrative new businesses for the materials company as it seeks to push past a wave of costly litigation (
“We’re building on our innovation model,” 3M CEO Mike Roman said in an interview. He called out thermal barriers for electric vehicle batteries as one product line that holds particular promise.
Roman talked up 3M’s product development as the Minnesota-based materials company’s growth projections failed to impress investors, who sent the stock plunging more than 11% Tuesday. 3M’s 2024 earnings guidance also came in beneath Wall Street expectations.
-- Roman said revenue will be hindered in 2024 as 3M exits about 5% of its
consumer business in areas where it doesn't see strong growth prospects.
He said that will improve revenue and profit margins in the long term.
-- 3M, which makes thousands of products from furnace filters to office
supplies, said it expects to earn an adjusted $9.35 to $9.75 per share in
2024. Analysts polled by FactSet were expecting $9.90.
-- 3M said it expects adjusted sales to grow by 0.25% to 2.25% in 2024. The
numbers don't reflect the impending spin-off of 3M's health care business,
which accounts for about a quarter of overall sales.
That spinoff is set to deliver to 3M a multi-billion dollar dividend, which analysts say could go toward legal settlements the company reached last year over so-called “forever chemicals” and military earplugs alleged to be defective.