Fourth-quarter GAAP earnings were $1.88 per share, an increase of 13.3% versus the fourth quarter of 2015. Sales increased 0.4% year-on-year to $7.3 billion. Organic local-currency sales increased 1.6% while divestitures reduced sales by 0.4%. Foreign currency translation reduced sales by 0.8% year-on-year.
Operating income was $1.7 billion and operating income margins for the quarter were 22.7%, up 220 basis points year-on-year. Fourth-quarter net income was $1.2 billion. The company’s operating cash flow was $2.2 billion, contributing to conversion of 154% of net income to free cash flow, as referenced in the “Supplemental Financial Information Non-GAAP Measures” section.
“The fourth quarter capped a successful year for our enterprise, as we posted double-digit growth in earnings per share, expanded margins and delivered robust cash flow,” said Inge G. Thulin, 3M’s chairman, president and CEO. “We also made incremental investments to accelerate growth in core platforms, while returning significant cash to shareholders.”
Full-year 2016 GAAP earnings were $8.16 per share, an increase of 7.7%. Sales decreased 0.5% to $30.1 billion and organic local-currency sales declined 0.1%. Acquisitions, net of divestitures, increased sales 0.8%. Foreign currency translation reduced sales by 1.2%.
Full-year operating income margins were 24.0%, up 110 basis points versus 2015. The company’s operating cash flow was $6.7 billion, contributing to conversion of 104% of net income to free cash flow for the year.