3M on Tuesday reported higher sales in its latest quarter as its profit numbers reportedly exceeded projections on Wall Street.
But the Minnesota-based industrial giant also reportedly warned that dramatic jumps in the price of oil could lead to price increases in its product lineup down the road.
The company posted first-quarter sales of $6 billion, which was up 1.3% year-over-year despite a 1.4% dip in organic sales. The company also highlighted a quarterly operating margin that rose 230 basis points to 23.2%.
3M’s earnings came in at $1.23 per share, which reflected a decline of 40%, although the company noted that its adjusted earnings per share of $2.14 were up 14% over that span. 3M noted in its presentation that sales were up in its safety and industrial segment, which offset dips in its consumer and transportation and electronics divisions.
3M CEO Bill Brown called the results “a good start to the year” and said that officials are “executing on 3M's value creation framework to build a stronger company.”
The company maintained its outlook for the full year, but Brown also pointed to a “volatile” operating environment. He told analysts during an earnings call that rising oil prices could translate to an additional $125 million in annual costs, and, in turn, a 50-basis-point increase in product prices, according to Reuters.
"Our focus remains on improving execution of the fundamentals and transforming the company by simplifying and standardizing our processes and footprint and reshaping the portfolio,” Brown said in an earnings release.
