Demand for Solar films used in panels surpases analysts' expectation

3M Boosts Forecast as Renewable Energy Helps Top Earnings Estimates

By Will Daley - Apr 26, 2011 9:51 AM ET

3M Co. boosted its full-year earnings forecast after first-quarter profit rose 16 percent. Photographer: Andrew Burton/Bloomberg 

3M Co. (MMM) boosted its full-year earnings forecast after first-quarter profit surpassed analysts’ estimates, fueled by demand for films used in solar panels and tablet computers.
Profit this year will be $6.27 to $6.47, excluding pension- related expenses, compared with a February forecast of $6.17 to $6.42 a share, the St. Paul, Minnesota-based maker of Scotch tape said today in a statement.
Sales increased about 20 percent at the industrial and transportation division, whose products include films for solar panels and windows, and at the electronics and communications unit, which makes films for smartphones. 3M said the earthquake and tsunami in Japan will curb 2011 profit by 10 cents to 13 cents a share, and favorable currency translation will help offset that.
“The year has started off better than we would have expected,” Stephen Tusa, a JPMorgan Chase & Co. analyst in New York, wrote today in a note. Tusa has a “neutral” rating on the shares.
3M climbed $1.65, or 1.8 percent, to $95.77 at 9:50 a.m. in New York Stock Exchange composite trading, the highest intraday price since October 2007. The shares gained 9 percent this year before today.
First-quarter net income rose to $1.08 billion, or $1.49 a share, from $930 million, or $1.29, a year earlier. Analysts projected profit of $1.44, excluding some items, the average estimate of 15 analysts surveyed by Bloomberg.

Economic Bellwether

Revenue climbed 15 percent to $7.31 billion, compared with an average estimate of $6.95 billion, with sales gains at all six divisions. 3M is an economic bellwether because of its product range which spans health-care, consumer, automotive and energy markets.
3M’s full-year forecast tops analysts’ average estimate of $6.22 a share and last year’s adjusted profit of $5.75 a share.
3M has five manufacturing sites and about 2,700 workers in Japan, where its largest businesses are industrial and consumer-related.
3M today said favorable currency translation will increase sales this year by 2 percent to 3 percent, up from a previous forecast of 1 percent to 2 percent.