Manufacturing conglomerate 3M lowered its full-year 2015 outlook on Tuesday, crediting a weakened industrial market and global economy.
The St. Paul, MN-based company reduced its 2015 outlook to 1 percent organic growth, down from a previously lowered outlook of 1.5 to 2.0 percent in its third quarter earnings report on Oct. 22. Earlier in 2015, 3M's organic growth outlook was 2.5 to 4.0 percent.
"We're seeing particular weakness in industrial-related businesses in the United States, and we're also seeing weaker than expected demand in consumer electronics," 3M CFO Nick Gangestead said in a conference call Tuesday morning.
The lowered outlook reflects similar projections by many large industrial manufacturers and distributors, which have had their 2015 earnings hampered by low oil prices, the strong U.S. dollar forcing currency headwinds, and economic slowdowns in China and Europe.
Read More: A Gloomy October in Industrial Distribution
On the bright side, 3M said that cost-savings and efficiency efforts around the globe – such as its plan to cut 1,500 jobs (1.7 percent of workforce) – are expected to cut operating costs by $500 million to $700 million by 2020.
Gangestead and 3M CEO Inge Thulin said the company is expecting 2016 organic growth of 1 to 3 percent, with earnings to grow 7 to 12 percent.
In 3M's 2015 third quarter, its sales were down 5.2 percent from 2014 and profit fell 0.5 percent, while organic sales increased 1.2 percent. Sales for the first nine months of 2015 were down 4.7 percent from last year.
