Diversified U.S. manufacturer 3M Co handily beat Wall Street's profit expectations and raised its revenue forecast, boosted by surprisingly strong demand for consumer electronics and for its respiratory masks, which were snapped up by people afraid of the swine flu virus.
Shares of 3M, considered a bellwether of the U.S. economy because of the breadth of its operations and geographic reach, surged 2.4 percent to $66.50 in premarket trading Thursday.
The company, which makes products ranging from Scotch tape to optical films for liquid crystal display televisions, said it now expects organic sales for the year to drop by 10 percent to 13 percent, a more modest decline than its prior forecast for a fall of 11 percent to 15 percent. It now looks for 2009 profit of $4.10 to $4.30 per share, raising the low end of its forecast from $3.90.
Analysts, on average, had looked for full-year profit of $3.97 per share, according to Reuters Estimates.
While the exact shape and timing of the economic recovery is unknown, we will move ahead efficiently and energetically so that 3M emerges from the downturn an even stronger company, Chairman and Chief Executive George Buckley said in a statement.
Second-quarter net income came to $783 million, or $1.12 per share, down from $945 million, or $1.33 per share, a year earlier.
Factoring out one-time items, the company earned $1.20 per share. On that basis, analysts had looked for 94 cents per share.
Revenue fell 15 percent to $5.72 billion. Wall Street had anticipated $5.36 billion.
Shares of the St. Paul, Minnesota-based company are up 11.6 percent this year, outpacing a 1.2 percent rise in the Dow Jones industrial average <.DJI>.
(Reporting by Scott Malone; editing by John Wallace)