3M 2004 Annual Report Download - page 3

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W. James McNerney, Jr.
Chairman of the Board and Chief Executive Officer
The people of 3M are committed to pioneering innovative technologies and products,
growing faster than the economies we serve and delivering strong results.
In 2004, they continued to transform the way we operate, achieving several new milestones – both financial
and in other key areas of operating performance. We reached the $20 billion mark in sales – an increase
of nearly 10 percent from 2003. We posted another all-time high in earnings, generating $3.0 billion of net
income – a 24.4 percent increase. We boosted operating profit margins 2.5 percentage points to 22.9 percent.
And we increased cash from operating activities 13.5 percent to $4.3 billion.
Our results were driven primarily by a combination of solid top-line growth and continued improvements
in operational efficiency. We increased sales volume nearly 7 percent, significantly outpacing the rate of
economic growth. And cost-reduction projects related to our corporate initiatives increased operating
profit by more than $400 million.
Broad-based growth A rejuvenated culture of accountability is reinforcing the delivery of broad-based
business results. All seven of our businesses contributed to our sales growth in 2004. And all seven
achieved increases in both profits and profit margins. Profits rose 44.5 percent in our Industrial Business,
27.8 percent in Display and Graphics, 17.9 percent in Consumer and Office, 14.1 percent in Electro and
Communications, 12.3 percent in Safety, Security and Protection Services, 10.1 percent in Transportation,
and 9.3 percent in Health Care.
TO OUR
SHAREHOLDERS
innovate, grow, deliver 1