3M (MMM), the maker of 55,000 products from Post-It Notes and Scotch tape to electric road signs and power lines, easily topped estimates as the firm cut jobs and benefited from a “tremendous sequential surge” in demand for respiratory masks that protect against the swine flu. The company raised the lower end of its full-year profit guidance and tightened its sales projections.
Revenue fell 15% to $5.6 billion with sales down across all of the company’s major business lines and geographic markets, although sales climb 12.4% sequentially over wider profitability. Healthcare and consumer and office segments were once again the strongest performers. The company saw particular weakness in the automotive, construction, and telecom industries.
CEO George Buckley expressed that there is a risk that recent upticks in orders could be a “false down” caused by an over-correction in inventory levels earlier this year by 3M’s customers rather than a sustainable recovery in demand.
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Peter J. Lazaroff, Investment Analyst
Thursday, July 23, 2009
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