LONDON (ShareCast) - (Sharecast News) - 3M's first quarter sales rose as demand for the US conglomerate's respirators and health products surged during the Covid-19 crisis.
Sales rose 2.7% to $8.1bn (£6.5bn) in the three months to the end of March from a year earlier as healthcare sales jumped. Net income rose to $1.3bn from $893m.

Earnings rose 47% to $2.22 a share. Excluding special items, adjusted earnings fell 2.7% to $2.16 a share. Sales and adjusted earnings both beat consensus estimates of $7.9bn and $2.03 a share respectively.

3M, which makes masks and respirators, withdrew its financial guidance because it was not able to judge the length and extent of the Covid-19 emergency on markets it supplies.

The company said it doubled output of respirators to 100m a month to meet demand during the crisis and had increased capital investment to double output again. 3M said it had not increased respirator prices during the crisis and was working with legal authorities to prosecute price gouging.

Healthcare sales rose 21% to $2.1bn as 3M's business increased for drug delivery, medical solutions and food safety. Consumer sales also rose, up 4.6% to $1.3bn, as home improvement, home care and health business increased and stationery and office supplies sales fell.

Mike Roman, 3M's chief executive, said: "We are attacking the pandemic from all angles, which includes mobilising all of our resources and rapidly increasing output of critical supplies to healthcare workers and first responders. In the first quarter we saw strong growth in personal safety, as well as in other areas of our portfolio experiencing high demand due to the pandemic."

3M paid $847m of dividends in the quarter and said it was adjusting its capital spending to prioritise organic investments and the dividend. It has suspended share buybacks.

Capital spending will be about $1.3bn in 2020, down from a previous target of up to $1.8bn. Cost savings in the second quarter will be between $350m and $400m, 3M forecast.

Safety and industrial sales dipped 1% to $2.9bn and transportation and electronics sales fell 5% to $2.2bn as economies went into near-shutdown towards the end of the quarter.

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