3M 4Q16 Earnings Call Notes

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3M’s (MMM) CEO Inge Thulin on Q4 2016 Results

We are laying out a localization strategy

“As you know, we are laying out very much localization strategy in terms of our business well all subsidiaries around the world. So at this point in time, we continue to lay out the plan as we have talked about. We are making investment in what we see the most important businesses for us to grow both in the United States and overseas based on that strategy, right. So by definition, even if we have both the global customers and local customers, we need to make the investment based on what they are and what they are going.”

Don’t see excess inventory in our consumer channels

“Julian as far as the consumer business in the trends we saw throughout the fourth quarter much of this differential we saw between sell in and sell out occurred in December and in particular in the last half of December. In regards to inventory, we don’t really see the channel is having excess inventory now. We considered a fairly normal inventory channel level in our consumer channels.”

Broad based growth in industrial

‘”Well, first of all it was broad-based growth in Industrial, both in terms of the businesses and in terms of the geographical area. So that was not one specific business that type stood out of in terms of growth, even if you saw a Nick comment on – again the fantastic performance for the automotive OEM business, but it was broad-based and it’s coming back, I would say a little bit as we have talked about earlier in terms of evolution of economies.

And I think you’ve seen now as becoming more output from manufacturing around the world, we are very early in that process. And if you look upon PMI, the United States had a PMI of 54.7% in the quarter, China 51.4%, and Germany 55.6%. If you think about that in terms of big economies that will help us as we move forward, and as I said, it was broad-based.”

Should see an uptick in the energy space by the end of 2017

“yes, we should see an uptick in the end of 2017 in the energy space and we have a very strong solid business in two utilities, right. That’s a core 3M business and in fact this is a Heartland division. That division will do well.”