The 3M Co (NYSE: MMM) stock price rallied 3% after releasing the financial results for Q2 2023. The company’s GAAP loss per share of $12.35 and operating margin of minus 107.6% was driven by the previously announced proposed settlement agreement with PWS in the United States.
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The Public Water Systems (PWS) settlement regarding PFAS resulted in a pre-tax charge of $10.3 billion payable over 13 years, negatively impacting earnings per share by $14.19. The company’s earnings per share of $2.17 includes pre-tax restructuring charges of $212 million, or negative $0.31 per share.
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The American multinational conglomerate reported an adjusted operating income margin of 19.3%, including a 2.7% headwind from pre-tax restructuring charges. The company reported operating cash flows of $1.5 billion, up 34% compared to 2022.
3M’s sales were down 4.3% year-on-year to $8.3 billion, with organic sales falling 2.2% annually. The company had adjusted sales of $8.0 billion, down 4.7% year-on-year, with adjusted organic sales falling 2.5% compared to last year. The company generated adjusted free cash flows of $1.5 billion, marking a 44% improvement from 2022.
3M paid dividends worth $828 million to its shareholders as part of its plan to return capital to shareholders. The company raised its full-year adjusted EPS expectations for 2023 to $8.60 to $9.10 from the previous $8.50 to $9.00.
The company also maintained its revenue growth targets of -5% to -1%, as organic sales growth declines by 3% or remains flat. The firm’s adjusted operating cash flow target is unchanged at $5.9 to $6.3 billion.
Mike Roman, 3M’s chairman and CEO, said: “In the second quarter, the actions we took to strengthen our supply chain and restructure the company led to improved service for customers, reduced costs across 3M, and better than expected margins and cash flow. As we execute our strategy, we are positioning 3M for long-term performance, including progressing the planned spin of our Health Care business and addressing a significant portion of PFAS litigation.”
*This is not investment advice.
3M stock price.
The 3M stock price was trading up 3.05% at $107.45 from Monday’s closing price of $104.27.
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