3M (Saint Paul, Minn.) announced it will cut 2,000 jobs globally and restructure its business operations from five to four groups after suffering first-quarter sales declines in many of the company’s key markets, including China.
The company’s net sales fell to $7.9 billion during the quarter, a 5% decline compared with the first quarter of 2018. 3M’s net income increased 48% during the quarter to $891 million, or $1.51 per share. Its adjusted earnings per share dropped below expectations to $2.23, compared with $2.50 during the same period last year. Sales in the company’s industrial segment fell 6.6% to $2.9 billion, and sales in its safety and graphics segment fell 4.2% to $1.7 billion.
Sales in the U.S. grew 0.1% but fell 7.4% in Asia-Pacific, the company’s largest market outside of the U.S. The company also saw a 6.5% sales decline in Latin America/Canada and a 9.4% sales decline in Europe, the Middle East and Africa.
“The first quarter was a disappointing start to the year for 3M,” CEO Mike Roman said in a statement. “We continued to face slowing conditions in key end markets which impacted both organic growth and margins, and our operational execution also fell short of the expectations we have for ourselves.”
As a result, the company has restructured from five business groups to four, which are Safety and Industrial, Transportation and Electronics, Health Care, and Consumer.
Following the first quarter report, 3M’s stock fell 13%, its steepest plunge since 1987, when it fell 22.6%, according to MarketWatch. At press time, the company’s stock was trading at $192.13 per share.
