ean lobey executive vice president, safety, security and protection service business

3M Investor Meeting 2006 © 3M 2006 All Rights Reserved

Jean LobeyExecutive Vice President,

Safety, Security and Protection Services

Market Focus for Accelerated Growth


Safety, Security & Protection Services (SS&PS)

2005 results

Sales: $2.3 billion

Operating income: $553 million

Profit margin: 24.1%


Safety, Security & Protection Services (SS&PS)SecuritySafety Protection

Authenticate, secure and protect, people, materials and information

Personal safety solutions at work

and home

Protect and enhance facilities


The History And Direction Of SS&PS

Annual Growth*

Business Model

Time

> 8% growth7% growth4% growth

Expanded Market Focus:Strengthen core

Penetrate globally

Enter adjacent markets

Leverage world events

Market Focused:

SS&PS formed bringing products together into amarket-focused organization

Product Focused:

Businesses separated residing in non-safety focused organizations

2006 and beyond2003 - 20052001-2002

* Annualized Local currency


3M SS&PS: Key Financial Data

$1.9$2.1

$2.3

$0.6

$0.0

$1.0

$2.0

$3.0

2003 2004 2005 Q1 2006

$416$465

$537

$164

$0

$200

$400

$600

2003 2004 2005 Q1 2006

2005 Sales By Geographic AreaU.S. 43%

Europe 26%APAC 20%

LAC 11%

Sales Operating Income

LC Growth 9.5% 21.6%6.6% 6.9% 15.6% 21.9% 23.4% 26.0%OI Margin

$Billions & YOY % Chg $Millions & YOY % Chg

+14% +10%+8%

+13%

+12%+15%

+30%

+32%*

*2002 estimated s tock options, not restated.


Large And Growing Markets

Safety$23 Billion

Security $86 Billion

Protection$48 Billion

TrendsMigration of industrial productionIncreased regulatory oversight in developing countriesPandemic disease threats – Avian Flu, SARSIncreased consumer awareness

Security is a leading issue for governments, corporations and individualsGlobal economic disruption due to terrorist threatsImproved technologies for asset trackingIncreased awareness of brand value and the need for brand security

Increased demand for hygiene and cleaning productsGrowing awareness of food safety threatsIncreasing demand for asset protectionStrong commercial and residential building growth in AsiaRecent impact of natural disasters


Key Drivers For Growth

Developing new and differentiated products addressing customer needs for safety, security and protection

Penetrating international markets

Expanding into adjacent markets

Create an EBO focused on Track and Trace

First responder to world events


New Products In Respiratory Protection

3M SolutionsMarket Needs

Performance

Comfort

Utility

Range of Protection

End of Service Life Indicator

Filter Media

Advanced Particle Filtration

Respirator Technologies

Organic Vapor Detection

Advanced Adsorbents

Nanotechnology Catalysts


Entry Level

Full Product Line To Meet Diverse Customer Needs

Mid Range

8110S8210/8810

8710

8000

2003

8210+

2003

P1Dragon

2002

High Value

8240

8511

8211

8516

8515

92119210

9010

2006

Norbert

2006

8710V

2006

8246/8247

8271

8233/8293

8512/8514

8212/8214

8576/8577

9910

2005

8200

2005

9936/8833

2005

2007

2007

2007


New Products In Security Systems

Optical Films

Software Development

Security System Technologies

Systems Integration

Adhesives

Hardware Development

Security

Protection

Authentication

Identification

Tracking

Productivity



Consular Services

Data & Image Capture

Hardware & Software

Passport Data Page

Printer

Document Authentication

Reader

AutomatedHome Office

Reports

Border Security, United Kingdom

UK Opportunity:Provide 480,000 passports annually, at 144 issuance sites

3M Solution:e-Passports using RFID technology improve document identification and authentication


New Products In Window Protection

Optical Films

Abrasion Resistant Coatings

Window Film Technologies

Metalized & Pigmented

Films

Adhesives

Nanotechnology Coatings

Energy Savings

Comfort

Glare Reduction

Shatter Resistance

UV protection

Fade Resistance



New Product - Prestige Window Film

Customer Problem Damaging UV rays cause fadingHeat from sunlight decreases comfort Increasing energy costsWindow film corrosion from existing solutionsDark tinted solutions with high reflectivity

3M Solution:Rejects up to 97% of the sun’s infrared light Cooler home, lower energy billsFurnishings don’t fadeNo corrosionNo cell phone interference View from interior is as clear as original window


New Products In Cleaning Systems

Non-woven Media

Hardware Design

Cleaning Technologies

Microbial Control

Adhesives

Chemical Management

Cleaning and Hygiene

Performance

Productivity

Labor and Ergonomics

Compliance



New Product – 3M Easy Clean SystemEasy Clean Line

3M Easy Trap Duster System

3M Easy Scrub Flat Mop System

3M Easy Shine Applicator System

Rethink CleaningReduce labor costs by up to 70%

Increase performance up to 6 times

Cut chemical waste by as much as 80%Reduce mop drag by up to 10 times


Strong Growth From Developing Markets

0%

10%

20%

30%

40%

50%

60%

70%

Russia China India Turkey Middle East Poland Korea Brazil

2002 - 2005 Sales CAGR in USD

2006 Q1 : + 25.7%


+ Established Lab+ New/expanded Lab

Established ManufacturingNew/expanded Manufacturing

International Sales 57% of Total Sales

+

+

+

+

++

+

+

+

+

+

+

Bringing SS&PS Closer To Our Customers


Korea: Manufacturing Localization Of Respirators

Asian Lab.

Regional SOSCapability

Regional SOSCapability

Local ManufacturingCapability Increase

Local ManufacturingCapability Increase

100%Imported Goods

100%Imported Goods

0

5

10

15

20

25

30

35

40

45

'90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08

SC

AF

SC

AF

SC

AF

SC

AF

SC

AF

S/L, P

F15 Years CAGR : 31.3%

(1990~2005)

2006~2008Addition of

manufacturing &converting lines

SC

AF


New product – Security Laminate For Driver’s Licenses

Customer ProblemCurrent Driver’s Licenses (DLs) easily counterfeitedAlternations to DLs difficult to detectHigh-end security features typically require special tool for verificationDepartments of Motor Vehicle want to provide DL that is simple to authenticate

3M Solution:Provide an easy to recognize overt security feature (Floating Image)Build on existing high security laminate platform (Confirm™) Work with State’s preferred system integrator to provide material solution


Asset Tracking & Supply Chain Security, Brazil

Customer Problem:Counterfeiting of pesticidesResulted crop failureRisked consumer health & safety

3M Solution:Tamper indicating labelsAutomated labeling equipmentAuthentication readers


Automotive Window Film, China

China Auto Opportunity:+10% CAGR in local car productionIncreasing vehicle ownershipGrowing demand for “do it for me” car care

3M Solution:A multi-layer patented optical filmMetal-free composition: No interference with mobile phone, GPS and radio reception Easy maintenance, long-life filmReduced reflectivitySuperior heat rejection and UV protection Launching Q2, 2006 in China


WeldingImproving Welder Safety And Productivity

Adjacent Markets – External Growth

HÖRNELL Acquisition Value Creation: Auto darkening lens technologyLeading brandWelding channel accessAdditional sales of 3M safety and industrial products


Adjacent Markets – Internal Program

Leveraging our granules coloring expertise to penetrate swimming pool market segment.


Adjacent Markets – Internal Growth

Mining Focus:Market-focused sales and marketing organizationDirect end-user contact Key account penetration plansApplication replication plansProduct offering: Entire 3M portfolio

Liquid Dust SuppressantNomad Acid Mist Matting

MiningMiner Safety & Process Improvements

RFID Cathode Tracking


Adjacent Markets – Internal Growth

Health Care Focus:Health care sales and marketing specialistsCoordination with 3M Medical DivisionCritical cleaning products & training servicesEmployee safety programs

Customer TrainingEasy Scrub

Health Care MarketFacility Hygiene & Infection Control

Easy Shine


Adjacent Markets – Emerging Business

Food Producers Food Processors Food Service

Attractive Industry Trends:Increased concern about food safety Consolidation, globalization and increased speed of the supply chainsGovernment and consumer driven demand for healthier foodsIncreasing regulations

Food SafetySolutions that prevent, detect and remediate food safety threats


Technology Convergence – The Track and Trace Opportunity

Everything of value will be tracked everywhere

Significant productivity improvements

Improved security of assets and people

0

10

20

30

40

2006e 2009e

GPS

RFID

Wireless

Software

Total market sales ($ B)


Example: End-to-End Logistics


Existing businesses

Existing technologies

Unmatched customer relationships

Increased investment in R&D

3M assets

Selective acquisitions and investments

External

Track and Trace EBO

“Global real-time visibility”

We Are Creating An EBO To Address This Opportunity


Customer ProblemImpossible to track identity, location and condition of cathodesSignificant process variabilityDifficult to manage cathode maintenanceLost yield/productivity of mining process

3M SolutionRugged, chemical resistant RFID tag applied to cathodesEngineered cathode locator systemSoftware tracking system integrated into plant operating systemData extraction and analysis system to monitor and predict cathode and bath performance, reduce process variability

New Product – Mining Cathode Tracking System


New product – Life Vest Tracking SystemCustomer Problem

Time-consuming to locate expired and missing life vestsRegulatory bodies require compliance on every flight – life vest for each passenger on over-water flights

3M Solution3M RFID tags incorporated into life vests during vest manufactureProvide handheld reader and application software to airline operatorsPilot full solution at major air carriers consistent with emerging standards in aerospace industryLeverage into further on-board productivity enhancing applications

Application Screen ShotRFID Enabled Life Vest


Our Winning Attributes

Superior relationships with a broad range of industrial customers

Numerous established programs ongoing, with strong results

Critical mass

Broad spectrum of critical technologies

Financial strength


2003 2004 2005 2006 2007

Capital Additions

First Responder To World Events

SS&PS Capabilities:Organizational readiness Trusted solution providerGovernment agency assistancePersonal protection kitsAdditional manufacturing capacityFuture new products


SS&PS - SummaryThe market-focused leader providing complete

solutions that make people and assets safe, secure and productive.

Winning through execution:Developing new and differentiated products addressing customer

needs for safety, security and protectionPenetrating international marketsExpanding into adjacent marketsFirst responder to world events

ean lobey executive vice president, safety, security and protection service business

Economy & Finance