3M Posts It: Fool by Numbers

On April 26, Motley Fool Inside Value pick 3M (NYSE: MMM  ) released first-quarter earnings for the period ended March 31.

  • Organic revenues rose 7.6% internationally, versus only 2.6% at home.
  • EPS from continuing operations rose 14.3%, thanks to share buybacks and a 9.9% jump in continuing operating income.
  • Management reiterated 2007 EPS guidance of $5.20 to $5.45, which includes a gain on the sale of the company's pharmaceuticals business of $0.60 to $0.70.
  • 3M is oh-so-popular in the Motley Fool CAPS community, sporting a five-star rating. Fellow Inside Value pick Wal-Mart (NYSE: WMT  ) , on the other hand, only sports a two-star rating.

(Figures in millions, except per-share data.)

Income Statement Highlights

Q1 2007

Q1 2006

Change

Sales

$5,937.0

$5,595.0

6.1%

Net Profit*

$946.0

$860.6

9.9%

EPS*

$1.28

$1.12

14.3%

Diluted Shares

741.3

768.6

(3.6%)

*Based on continuing operations.

Get back to basics with the income statement.

Margin Checkup

Q1 2007

Q1 2006

Change*

Gross Margin

49.1%

51.4%

(2.3)

Operating Margin**

22.2%

24.5%

(2.3)

Net Margin**

15.9%

15.4%

0.6

*Expressed in percentage points.
**Based on continuing operations.

Margins are the earnings engine.

Balance Sheet Highlights

Assets

Q1 2007

Q1 2006

Change

Cash + ST Invest.

$2,286.0

$1,296.0

76.4%

Accounts Rec.

$3,444.0

$3,105.0

10.9%

Inventory

$2,714.0

$2,379.0

14.1%

Liabilities

Q1 2007

Q1 2006

Change

Accounts Payable

$1,441.0

$1,342.0

7.4%

Long-Term Debt

$1,771.0

$1,291.0

37.2%

The balance sheet reflects the company's health.

Cash Flow Highlights

Q1 2007

Q1 2006

Change

Cash From Ops.

$580.0

$618.0

(6.1%)

Capital Expenditures

$304.0

$190.0

60.0%

Free Cash Flow

$276.0

$428.0

(35.5%)

Free cash flow is a Fool's best friend.

Related Foolishness:

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean. This data has been provided by Netscribes. To provide feedback on this article, please click on the "feedback" button below.


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