3M Co. (MMM.N) plunged after a poor start to 2019 prompted the company to cut its profit forecast for the second time in three months.
Operating income fell in all five business units during the first quarter, with particular weakness in automotive and electronics markets, 3M said in a statement Thursday as it reported earnings. The maker of Post-it notes and touchscreens also warned of headwinds in China and said it would cut 2,000 jobs worldwide as part of a restructuring to reduce costs.
“The first quarter was a disappointing start to the year for 3M,” Chief Executive Officer Mike Roman said in the statement.
The poor results extend the pain for 3M, a diversified manufacturer that has recently struggled with high raw-materials prices, headwinds in the health-care business and unfavorable foreign exchange rates. Roman, who took the helm last year, is looking to return the company to the steady performance it was known for under his predecessor, Inge Thulin.
3M fell 8 per cent to $201.99 before regular trading in New York.
Adjusted earnings will be no more than $9.75 a share in 2019, down from the previous forecast of at least $10.45, 3M said. Analysts had been expecting $10.53.
Excluding the impact of currency exchange, sales are at risk of falling as much as 1 per cent after adjusting for the effects of acquisitions and divestitures, 3M said. The St. Paul, Minnesota-based company had previously predicted a gain of 1 per cent to 4 per cent.
The St. Paul, Minnesota-based company also said organic local-currency sales are at risk of falling as much as 1 per cent, after previously predicting a gain of 1 per cent to 4 per cent.
In the first quarter, adjusted earnings fell to US$2.23 a share, trailing the US$2.48 average of analyst estimates compiled by Bloomberg. Sales dropped 5 per cent to US$7.86 billion. Analysts had expected US$8.02 billion.