Download - Inge g-thulin ceo

1. All Rights Reserved.28 March 2016© 3M

2016 InvestorDayInge Thulin

Chairman of the Board,

President, and CEO

3M Investor Day

March 29, 2016

2. All Rights Reserved.28 March 2016© 3M 2

Today’s highlights

Building strength on strength

Efficient growth

Agenda


Today’s highlights

Our business portfolio is positioned to win

Executing on our key levers to create efficient growth

Portfolio Management, Invest in Innovation, and Business Transformation

Winning with our customers by helping them deliver on their promises

Further enhancing capital structure and allocation

Maintaining strong track record of returning cash to shareholders

Announcing new 2016-20 financial objectives; reaffirming 2016 outlook


Building strength on strength, and positioned to win

2012 Articulated 3M Vision and Strategies Set 2013 – 2017 Financial Objectives Established robust portfolio management

2013 Prioritized 3 Key Levers to create value Enhanced capital deployment plan Strengthened Code of Conduct

2014 Defined Fundamental Strengths Reshaped Leadership Behaviors

2015 Deployed unified 3M Brand strategy Restructured organization for focus,

agility and efficient growth


Investing in Innovation

Portfolio Management

Business Transformation

Our playbook is working


Industrial

$10.3B21.9%

Health Care

$5.4B31.8%

Consumer

$4.4B23.7%

$30.3B Revenue

22.9% Operating Margin

Safety & Graphics

$5.5B23.7%

Electronics & Energy

$5.3B21.1%

Executing on efficient growth while building for the future

Executing this playbook has created a successful portfolio . . .2015 results

Executing on efficient growth while building for the future


. . . Leveraging our Fundamental Strengths to create sustainable value

Technology Manufacturing Global Capabilities Brand

Leveraging these assets creates value; strengthening them ensures our future


GD

P p

er c

apit

a

Infrastructure

Health Care

Manufacturing

Retail

Time

Safety

We execute a proven model of success globally . . .

Positioned for efficient growth

http://solutions.3m.com/wps/portal/3M/en_US/PPESafetySolutions/PPESafety/Personal_Protective_Equipment/Product_Catalog/?N=5003987&rt=c3

http://solutions.3m.com/wps/portal/3M/en_US/PPESafetySolutions/PPESafety/Personal_Protective_Equipment/Product_Catalog/?N=5003987&rt=c3


. . . Enabling us to consistently outperform our markets

3.4%

2.3%

~1.5x

3M Organic Local CurrencyIHS Industrial Production Index

IHS Industrial Production Index vs. 3M Organic Local Currency Growth2011 – 2015 CAGR

Source: IHS Global Insights

Consistent proven capability to outgrow our markets

Organic local currency growth = organic volume + price


Our new growth targets will outpace indicators

~1.5x

3M Organic Local Currency

2% - 5%

IPI Projection Range

1% - 3%

IPI projection range vs. 3M organic local currency targets, 2016 – 2020e CAGR

Efficient growth in the face of economic realities


Industrial

2% to 4%Health Care

4% to 6%Consumer

3% to 5%

2% to 5%

Safety & Graphics

2% to 5%Electronics & Energy

0% to 4%

2016-20 organic local currency growth targets by businessStrong, market-leading, global businesses

Organic local currency growth = organic volume + price


Free Cash Flow

Conversion

100%

Organic Local Currency Growth

20%

EPSGrowth

8-11%

ROIC

2-5%

Long-term financial objectives2016-20 plan; aggressive and realistic targets


Winning with our customers by helping them deliver on their promises

Customer First


Sustainability: Helping our customers deliver on their promises

Leveraging 3M sustainability expertise in strategic partnerships with customers

Identifying and understanding sustainability challenges on the horizon

Expanding our portfolio of products with sustainability advantages

Creating new opportunities with customers


Investing in Innovation Business TransformationPortfolio Management

Executing our three key levers



Align organization and resources to our best opportunities

Effectively deploy M&A capital

Agile executionPortfolio Management

Gain profitable share everywhere


Organizational structure positions us to deliver efficient growth

Combined businesses to increase customer relevance and drive scale . . . 40 to 26 businesses

Realigned from 6 Sectors to 5 Business Groups Benefits realized

Greater scale and

customer relevance

Increased agility

Reduced costs through

efficiency and productivity

improvements

Reallocated resources to our

best opportunities

Accelerated priority R&D

investments

Enhanced M&A sourcing

and execution

Improved customer relevance

Healthcare

Safety & Graphics

Industrial Consumer

Display & Graphics

Electronics & Communications

Safety, Security, & Protection

Industrial & Transportation

Consumer & Office

Healthcare

6 Sectors 5 Business Groups

Electronics & Energy

40 Businesses 26 Businesses


Acquisitions Divestitures

Recent portfolio actions creating significant value

Library Systems

License plate converting (France)

Static control

Membrana = Polypore’s separation media business

Polyfoam


We will invest in and accelerate our Health Information Systems business

Fully assessed strategic options

Identified attractive investment opportunities in both core and new growth segments

Executing plan to accelerate growth by 200 – 400 bps

Expanding our leadership position in healthcare information systems



Increase R&D productivity

Enhance commercialization effectiveness

Invest in and scale new growth platformsInvesting in Innovation

3M innovation creating value for our customers


Insights combined with technology platforms continue to benefit our customers

46 Technology PlatformsInsights Productive Investment

Extending Core Platforms

Insights to Innovation

Expanding into New Markets

Disrupting Markets

Customer-Inspired Innovation

Research and development is the heartbeat of 3M


Our brand platform is building awareness of how we use science to create solutions for our customers

Enhancing perceptions of what 3M is about



Continue to successfully roll out ERP

Deliver productivity through footprint optimization and enhanced supply chain and manufacturing capabilities

Increase service levels to customers and reduce cost to serve


Business Transformation starts and ends with our customers


Business Service Operations

Global Processes and Governance

Global Service Centers

Supply Chain COEs

Business Transformation is accelerating

$500M to $700M annual savings and $500M working capital improvement by 2020


Building on our strong process culture

Deploy lean deeper and more broadly

Simplify and optimize processes

Increase employee engagement and

leadership development focus

Reducing costs and increasing quality for our customers


Developing our leaders

Adding value to our

company, our customers and

our communities

Creating opportunities

for everyone

We are investing in our people . . .

3M Leadership Way


. . . And supporting their personal health and well-being

Wellness screening and prevention

Healthy Living programs and incentives

Competitive rewards and investment opportunities





Our playbook is working


Free Cash Flow

Conversion

100%

Organic Local Currency Growth

20%

EPSGrowth

8-11%

ROIC

2-5%

Long-term financial objectives2016-20 plan; aggressive and realistic targets

Download - Inge g-thulin ceo

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