Diversified manufacturer 3M Co
The company also reiterated its 2009 earnings estimate, warning that profit would fall just short of Wall Street estimates, and its shares fell 1.25 percent.
We all know we're going through some transitions in the economy, and forecasting is very, very difficult, George Buckley, the company's president, chief executive and chairman, told investors at 3M's year-end outlook conference.
2009 was a very interesting year. But 2010 is going to be even more interesting, he said.
Unless the U.S. unemployment rate improves dramatically, the coming year will be a challenging one for companies that cater to consumers, he said.
With U.S. factories running on average at just 69 percent of capacity, volumes would have to increase by nearly 25 percent next year for capacity utilization to reach 85 percent, a level most analyst consider optimal.
Can you believe that is going to happen next year? Buckley asked. I don't know that I do.
As a result, he forecast the coming year would be marked by real market share transfers as weaker companies, unable to tap credit markets as before, fall by the wayside.
As the economy does come back, I think it's going to be hard for people to fund their growth, he said. So I think the strong are going to get stronger and the weak won't.
3M said it now expects full-year 2009 earnings to $4.50 to $4.55 per share excluding one-time items. Analysts' average estimate is $4.57, according to Thomson Reuters I/B/E/S.
For 2010, 3M expects earnings of $4.85 to $5.00 per share on sales of $24.5 billion to $25.5 billion. Analysts expect $4.94 per share on sales of $24.46 billion.
3M shares were down 1.25 percent at $76.94 in late-morning trading on the New York Stock Exchange.
(Reporting by James B. Kelleher and Helen Chernikoff; Editing by Dave Zimmerman, Ted Kerr and John Wallace)