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3M Expects Continued Solid Sales and Earnings Growth

21 September 2000

3M Expects Continued Solid Sales and Earnings Growth

    ST. PAUL, Minn., Sept. 21 3M announced today
at its biennial security analyst meeting that it expects annual sales growth
of about 11 percent and per-share earnings growth of about 13 percent over the
next three years.
    L.D. DeSimone, chairman and chief executive officer, said, "This is an
exciting time for 3M. As our results over the past several quarters
demonstrate, we're generating solid growth by building on powerful competitive
advantages and by successfully executing our business plans."
    DeSimone said the company will achieve its earnings expectations for the
second half of this year. "We continue to achieve strong results in Asia," he
said, "which will help overcome the effects of the weaker euro.
    "Our return on invested capital this year will be around 19.5 percent,
placing us in the top tier of S&P 500 companies."
    DeSimone described 3M as a "premier, technology-driven growth company"
that operates from strength in all aspects of the organization -- technology
platforms, manufacturing, supply chain and customer relationships. "Our
strengths," he said, "have created competitive advantages in all six of our
business segments."
    He said that the company is directing its investments toward high-growth
sectors of the economy, and noted that about a quarter of sales this year will
be in "new-economy" markets. "Three years from now, we expect that about a
third of our sales will be in these high-growth segments," he said. The
company also continues to reinvent its traditional product lines.
    New products will continue to be the primary engine of 3M's growth,
DeSimone said. This year, products introduced within the last four years will
account for an estimated 35 percent of the company's sales. By 2003,
new-product sales are expected to reach 40 percent.
    Growth also will continue to be driven by international expansion. Today
over half of 3M's sales come from outside the United States.  The company
expects the international component of its sales to grow by increasing market
penetration through new product introductions, and expansion of manufacturing
and marketing capabilities.
    Synergistic acquisitions will augment the company's growth. Priority
markets are electronics, telecommunications and health care.
    "In summary," DeSimone said, "we'll accelerate our growth by increasing
our participation in high-growth sectors, by reinventing our existing
businesses, and through acquisitions. And we'll continue to leverage our
innovation all around the world."