Sales and operating profits for the healthcare business at 3M Cos. (NYSE:MMM) rose during the third quarter, helping the industrial conglomerate top the consensus sales and earnings forecasts and sending share prices up today on Wall Street.
3M Health Care’s operating profits rose 9.3% to $471 million for the three months ended Sept. 30, compared with Q3 2016, on sales growth of 7.7% to $1.48 billion.
Overall profits for the parent company increased 7.5% to $1.43 billion, or $2.33 per share, on sales of growth of 6.0% to $8.17 billion. Analysts on the Street were looking for earnings per share of 2.21 on sales of $7.93 billion.
“Coming off a strong first half, our team delivered an even more robust performance in the third quarter – marked by an 8% increase in earnings per share and 7% organic growth that was positive across all business groups and geographic areas,” chairman, president & CEO Inge Thulin said in prepared remarks. “We also expanded margins to 25 percent, while investing for the future and returning significant cash to our shareholders.”
The news pushed MMM shares up 5.2% to $233.13 apiece today in mid-morning trading and prompted 3M to raise its outlook for the rest of the year.
The St. Paul, Minn.-based company said it now expects to post EPS of $9.00 to $9.10, up from $8.80 to $9.05 previously, on organic, constant-currency sales growth of 4% to 5% (up from prior guidance of 3% to 5%).
Drug delivery fuels health care growth
3M said the healthcare segment growth was powered by top-line growth for its drug delivery business, plus contributions from its food safety, medical consumables and oral care operations. Geographically, the growth was led by the Asia-Pacific region and the Americas, the company said.
