3M isn't counting on a smooth economic recovery in the U.S. this year. Instead, it's focusing on booming markets in Asia and Latin America.
"I don't think we should look to the U.S. for a big recovery in 2010," CEO George Buckley said in a conference call Tuesday after the company reported a surge in first-quarter earnings, driven mostly by international sales.
The company's international focus allowed it to raise its earnings and revenue forecast for the year as it reported earnings 80 percent higher than the first three months of 2009. 3M said that despite encouraging signs in industrial production and other core economic data, U.S. growth isn't keeping pace with other parts of the world — especially Korea, Taiwan and Japan.
The U.S. will more likely experience "a slow, patchy and gradual recovery (marked) by periods of occasional back sliding," Buckley said.
This is the second time 3M raised its profit outlook for 2010. It now expects per-share earnings of $5.40 to $5.60, excluding a charge related to the new health care law. Its previous forecast was $4.90 to $5.10 per share.
The maker of Post-Its and Scotch Tape said sales will grow 10 to 12 percent in its core businesses this year. That's up from a previous 5 to 7 percent forecast.
3M earned $930 million, or $1.29 per share in the first three months of the year, compared with $518 million, or 74 cents per share, a year earlier. Excluding a one-time charge related to the health care law, first-quarter earnings were $1.40 per share. The quarter also included some restructuring costs.
Revenue rose 25 percent to $6.35 billion. Thomson Reuters says analysts expected a profit of $1.21 per share on revenue of $5.94 billion.
The company, based in Maplewood, Minn., said its results were driven by electronics, automotive parts and respiratory health aids.
3M also makes over 1,000 products for cars, including abrasives and paint finishings. Those product lines grew on continued improvement in global auto sales compared with 2009, one of the weakest years in decades.
Sales in its display and graphics segment, which makes films for LCD TVs, cell phones and computers, improved the most.
Overall, sales climbed 54.1 percent in the Asia Pacific region. Sales in all six 3M business segments grew by double-digit percentages.
Shares rose $1.20 to $88.64 in afternoon trading. The stock hit a new 12-month high of $90.25 earlier in the session.
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